Filed Pursuant to Rule 424(b)(3)
Registration No. 333-82128
PROSPECTUS
903,375 Shares
I.D. Systems, Inc.
Common Stock
In January 2002, I.D. Systems consummated a private placement for 821,250
shares of I.D. System's common stock at $8.00 per share. Sanders Morris Harris
Inc. acted as the placement agent for the private placement and received 82,125
warrants for the purchase of common stock as partial compensation for its
services.
The selling stockholders will receive all of the net proceeds from sales of
their shares and will pay all brokerage commissions and similar selling
expenses, if any. We will not receive any proceeds from sales of the shares by
the selling stockholders.
The address and telephone number of I.D. System's principal executive
offices are:
One University Plaza
Hackensack, New Jersey, 07601
(201) 670-9000
Our common stock currently is quoted on the Nasdaq SmallCap Market under
the symbol "IDSY." The last reported bid price of our common stock on the Nasdaq
SmallCap Market on January 30, 2002 was $9.30.
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE OF RISK. YOU SHOULD
CAREFULLY CONSIDER THE FACTORS DESCRIBED UNDER THE CAPTION "RISK FACTORS" ON
PAGE 2 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
______________________________
The date of this Prospectus is February 14, 2002
Table of Contents
Page
----
Risk Factors..................................................................3
Special Information About Forward Looking Statements..........................5
Use of Proceeds...............................................................6
Selling Stockholder ..........................................................6
Plan of Distribution .........................................................7
Description of Securities.....................................................8
Indemnification for Securities Act Liabilities................................9
Where You Can Find More Information About Us.................................10
Legal Matters................................................................10
Experts......................................................................10
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You should read the entire prospectus and any documents incorporated by
reference carefully before purchasing I.D. Systems common stock. In this
prospectus, "I.D. Systems," "we," "us" and "our" refer to the business that is
owned and conducted by I.D. Systems, Inc. and its subsidiaries and not to the
selling stockholders.
RISK FACTORS
BEFORE YOU BUY SHARES OF OUR COMMON STOCK, YOU SHOULD BE AWARE THAT THERE ARE
VARIOUS RISKS ASSOCIATED WITH THE PURCHASE OF OUR COMMON STOCK. YOU SHOULD
CONSIDER CAREFULLY THESE RISK FACTORS, TOGETHER WITH ALL OF THE OTHER
INFORMATION IN THIS PROSPECTUS AND ALL DOCUMENTS INCORPORATED BY REFERENCE,
BEFORE YOU DECIDE TO PURCHASE SHARES OF OUR COMMON STOCK. THE TRADING PRICE OF
OUR COMMON STOCK COULD DECLINE DUE TO ANY OF THESE RISKS, AND YOU MAY LOSE ALL
OR PART OF YOUR INVESTMENT. YOU SHOULD ALSO REFER TO THE OTHER INFORMATION
CONTAINED IN THIS PROSPECTUS, INCLUDING THE DOCUMENTS WE INCORPORATE BY
REFERENCE UNDER "WHERE YOU CAN FIND MORE INFORMATION ABOUT US".
A MARKET FOR OUR TECHNOLOGY MIGHT NOT DEVELOP, CAUSING OUR REVENUES TO DECREASE
Our success is highly dependent on market acceptance of our wireless
monitoring and tracking system. The market for wireless monitoring and tracking
products and services is new and rapidly evolving. We are not certain that our
target customers will purchase our wireless monitoring and tracking system.
Additionally, we cannot assure you that the market for wireless monitoring and
tracking technology will continue to emerge or become sustainable. If the market
for our products fails to grow, develops more slowly than we expect or becomes
saturated with competing products or services, then our revenues will not
increase and our financial condition will be materially adversely affected.
WE MAY BE UNABLE TO MEET OUR FUTURE CAPITAL REQUIREMENTS, LIMITING OUR ABILITY
TO DEVELOP AND EXPAND OPERATIONS
Based on our current estimates, we believe that we have sufficient cash to
continue operations for the next 12 months. Unplanned expenses or development
opportunities may require us to raise additional capital. We currently do not
have a credit facility or any commitments for additional financing. We cannot be
certain that additional financing will be available when we require it and to
the extent that we require it. If additional funds are unavailable to us, or are
not available to us on acceptable terms, we may be unable to fund our expansion,
develop or enhance our products or respond to competitive pressures.
IF WE RAISE ADDITIONAL CAPITAL THROUGH THE SALE OF COMMON STOCK, PREFERRED STOCK
OR CONVERTIBLE DEBT SECURITIES, THE PERCENTAGE OWNERSHIP OF OUR THEN EXISTING
STOCKHOLDERS WILL BE DILUTED
We have issued common stock, options and warrants to purchase our common
stock, and in the future we may issue additional shares of common stock,
options, warrants, preferred stock or other securities exercisable for or
convertible into our common stock. At January 28, 2002, there were warrants to
purchase 307,125 shares of common stock outstanding. Additionally, we have
granted options to employees for the purchase of 2,205,426 shares of our common
stock, and expect to continue to grant employees stock options. Holders of our
common stock do not have preemptive rights. Therefore, issuances of additional
securities will dilute the percentage ownership of our stockholders.
SUBSTANTIAL SALES OF OUR COMMON STOCK COULD ADVERSELY AFFECT OUR STOCK PRICE
Sales of a substantial number of shares of common stock by stockholders
under the registration statement of which this prospectus is a part, under
another registration statement, under Rule 144 of the Securities Act of 1933 or
under other exemptions that may be available under the Securities Act of 1933,
could drive the market price of our common stock down by introducing a large
number of shares into a
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market in which there is a relatively small number of shares publicly traded.
Additionally, the increase in shares could increase the volatility of an already
volatile market.
OUR FAILURE TO PROTECT OUR PROPRIETARY TECHNOLOGY MAY IMPAIR OUR COMPETITIVE
POSITION
We believe that we have a competitive advantage over our competitors due to
our intellectual property rights. Although we seek to protect our intellectual
property rights through patents, copyrights, trade secrets and other measures,
we cannot be certain that:
o we will be able to adequately protect our technology;
o our patents will not be successfully challenged by one or more
third parties, which could result in our loss of the right to
prevent others from exploiting the technology described in the
patent;
o competitors will not be able to develop similar technology
independently; and
o intellectual property laws will be adequate to protect our
intellectual property rights.
Furthermore, policing the unauthorized use of our products is difficult,
and expensive litigation may be necessary to enforce our intellectual property
rights. Accordingly, we cannot be certain that we will be able to protect our
proprietary rights against unauthorized third party copying or use. If we are
unsuccessful in protecting our intellectual property, we may lose the
technological advantage we have over competitors.
WE COULD INCUR SUBSTANTIAL COSTS DEFENDING OUR INTELLECTUAL PROPERTY FROM A
CLAIM OF INFRINGEMENT BY A THIRD PARTY
In recent years, there has been significant litigation in the United States
involving claims of alleged infringement of patents and other intellectual
property rights. We could incur substantial costs to defend any such litigation.
Although we are not currently involved in any intellectual property litigation,
we may be a party to litigation in the future as a result of an alleged
infringement of another's intellectual property. If a claim of infringement of
intellectual property rights was decided against us, we could be required to:
o cease selling, incorporating or using products or services that
incorporate the challenged intellectual property;
o obtain from the holder of the infringed intellectual property
right a license to sell or use the relevant technology, which
license may not be available on reasonable terms; or
o redesign those products or services that incorporate such
technology.
IF WE ARE UNABLE TO KEEP UP WITH RAPID TECHNOLOGICAL CHANGE, WE MAY BE UNABLE TO
MEET THE NEEDS OF OUR CUSTOMERS
Our market is characterized by rapid technological change and frequent new
product announcements. Significant technological changes could render our
existing technology obsolete. If we are unable to successfully respond to these
developments or do not respond in a cost-effective way, we will be unable to
satisfactorily meet the needs of our customers. To be successful, we must adapt
to rapidly changing market conditions by continually improving the
responsiveness, services and features of our products and by developing new
features to meet customer needs. Our inability to meet customer needs would lead
to a loss of customers.
IF WE LOSE OUR KEY PERSONNEL OR ARE UNABLE TO RECRUIT ADDITIONAL PERSONNEL, OUR
BUSINESS MAY SUFFER
We are dependent on the continued employment and performance of our
executive officers and key employees, particularly Jeffrey M. Jagid, Chief
Executive Officer, Kenneth S. Ehrman, Chief Operating Officer, Ned Mavrommatis,
Chief Financial Officer, and Michael Ehrman, Executive Vice President of
Engineering. We currently have employment agreements with Messrs. Jagid, Ehrman
and Ehrman, but there is no guarantee that these employees who have entered into
employment agreements will fulfill the terms of their contracts or that they
will remain with us once the term of their respective employment agreements
expire. Like other companies in our industry, we face intense competition for
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qualified personnel. Many of our competitors for qualified personnel have
greater resources than we have. We cannot be certain that we will be able to
maintain salaries at market levels. Therefore, we cannot be certain that we will
be successful in attracting or retaining qualified personnel in the future.
WE MIGHT NOT BE ABLE TO OBTAIN THE SERVICES OF QUALIFIED SUBCONTRACTORS TO
PRODUCE OUR PRODUCTS LEADING TO DISRUPTION IN PRODUCTION AND DISTRIBUTION OF OUR
PRODUCTS TO OUR CUSTOMERS
In order to meet our requirements under our contracts, we rely on the
efforts and skills of subcontractors for the manufacture of our products and the
delivery of our products to our customers. There is great competition for the
most qualified and competent subcontractors. If we are unable to afford or hire
qualified subcontractors the quality of our services and products could decline.
Such conditions would limit our ability to perform our contracts with customers.
THE FEDERAL GOVERNMENT MIGHT IMPLEMENT SIGNIFICANT REGULATIONS WHICH MIGHT
REQUIRE US TO INCUR SIGNIFICANT COMPLIANCE COSTS
Our products transmit radio frequency waves, the transmission of which is
governed by the rules and regulations of the Federal Communication Commission.
Our ability to design, develop and sell our products will continue to be subject
to the rules and regulations of the Federal Communication Commission for the
foreseeable future. The implementation of unfavorable regulations, or
unfavorable interpretations of existing regulations by courts or regulatory
bodies, could require us to incur significant compliance costs cause the
development of the affected markets to become impractical or otherwise adversely
affect our ability to produce or market our products.
IF WE ARE UNABLE TO EFFECTIVELY MANAGE OUR GROWTH WE WILL BE UNABLE TO
SUCCESSFULLY OPERATE OUR BUSINESS IN THE FUTURE
Our rapid growth has placed, and is expected to continue to place, a
significant strain on our managerial, technical, operational and financial
resources. To manage our expected growth, we will have to implement and improve
our operational and financial systems, and we will have to train and manage our
growing employee base. We will also need to maintain and expand our
relationships with customers, subcontractors and other third parties. If we are
unable to effectively manage our growth, our business may become inefficient and
we might not be able to effectively compete with competitors.
OUR NEW PRODUCTS MAY CONTAIN TECHNOLOGICAL FLAWS AND WE MAY INCUR SUBSTANTIAL
LIABILITY DUE TO THESE FLAWS
Complex technological products like ours often contain undetected errors or
failures when first introduced or when new versions of the products are
introduced. Despite our every effort to eliminate these flaws, there still may
be flaws in our new products, even after the commencement of commercial
shipments. These flaws could result in a delay of, or failure to, achieve market
acceptance of our products, which, since our products are used in business
critical applications could lead to substantial product liability claims. Such
claims could not only adversely affect our immediate financial condition, but
could permanently injure our reputation in our industry.
SPECIAL INFORMATION ABOUT FORWARD-LOOKING STATEMENTS
Some of the statements in this prospectus are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve certain known and unknown risks,
uncertainties and other factors which may cause our actual results, performance
or achievements to be materially different from any future results, performance
or achievements expressed or implied by these forward-looking statements. These
factors include, among others, the factors set forth above under "Risk Factors."
The words "believe," "expect," "anticipate," "intend" and "plan" and similar
expressions identify forward-looking statements. We caution you not to place
undue reliance on these forward-looking statements. We undertake no obligation
to update or revise any forward-looking statements or publicly announce the
result of any revisions to any of the forward-looking statements in this
document to reflect future events or developments.
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USE OF PROCEEDS
Each selling stockholder is selling all of the shares covered by this
prospectus for his, her or its own account. Accordingly, we will not receive any
proceeds from the resale of the shares. We will, however, receive $786,757.50 if
Sanders Morris Harris, Inc. exercises its warrant to purchase common stock. We
expect to use these proceeds, if any, for general corporate purposes.
SELLING STOCKHOLDERS
We issued the shares of common stock covered by this prospectus to the
selling stockholders under the terms of a subscription agreement signed by each
stockholder. Under the terms of a registration rights agreement between each
investor and us, we are required to file the registration statement of which
this prospectus is a part prior to February 15, 2002.
The following table lists information regarding the selling stockholders'
ownership of shares of our common stock as of February 4, 2002. Information
concerning the selling stockholders may change from time to time.
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Number of Number of
Shares Shares to be Percent of the
Beneficially Number of Shares Beneficially Class Still
Owned Before That May be Owned if All Owned After
Name the Offering Offered Shares are Sold the Offering(1)
---------------------------------------------- ----------------- ------------------ ----------------- ----------------
Apogee Fund, L.P 100,000 100,000 0 0
Atlas Capital Master Fund, L.P. 37,500 37,500 0 0
E. Turner Baur 10,000 10,000 0 0
Robert A. and Julie T. Berlacher 15,000 15,000 0 0
Bernard Byrd Trust 6,250 6,250 0 0
CQ Fund Ltd. (2) 120,000 120,000 0 0
CQ Partners Fund, L.P. (2) 96,000 96,000 0 0
CQ Partners Fund II, L.P. (2) 24,000 24,000 0 0
Dewey Investment Partnership 6,250 6,250 0 0
Flyline Holdings Ltd. 25,000 25,000 0 0
David S. Hunt 25,000 25,000 0 0
Brian Kuhn 6,250 6,250 0 0
Lancaster Investment Partners, L.P. 100,000 100,000 0 0
Sanders Morris Harris, Inc. (3) 82,125 82,125 0 0
Trellus Partners LP 137,500 137,500 0 0
Trellus Offshore Fund Limited 112,500 112,500 0 0
Totals 903,375 903,375 0 0
___________________________
(1) Assumes that all of the shares of the common stock offered are sold.
(2) Edward Turner Baur, the controlling person of the managing partner of this
selling stockholder, owns 70,900 shares of I.D. Systems common stock
individually. Based on a Schedule 13G filed with the SEC
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on January 25, 2002, CQ Capital, LLC, the managing partner of the selling
stockholder, beneficially owns an aggregate of 467,300 shares of our common
stock, including the shares owned by the selling stockholder.
(3) The 82,125 shares of common stock being registered for Sanders Morris
Harris, Inc. are issuable upon exercise of warrants.
PLAN OF DISTRIBUTION
The selling stockholders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of common stock in private transactions or on any stock exchange, market or
trading facility on which the shares are traded. These sales may be at fixed or
negotiated prices. The selling stockholders may use any one or more of the
following methods when selling shares:
o ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
o purchases by a broker-dealer as principal and resale by the
broker-dealer for its account;
o an exchange distribution in accordance with the rules of the
applicable exchange;
o privately negotiated transactions;
o short sales;
o broker-dealers may agree with the selling stockholder to sell a
specified number of such shares at a stipulated price per share;
o a combination of any such methods of sale; and
o any other method permitted pursuant to applicable law.
The selling stockholders may also sell shares under rule 144 of the
securities act, if available, rather than under this prospectus.
The selling stockholders may also engage in put options, call options,
other forms of derivative securities and other transactions in our securities
and may sell or deliver shares in connection with these transactions. The
selling stockholders may pledge its shares to its brokers under the margin
provisions of customer agreements. If a selling stockholders defaults on a
margin loan, his, her or its broker may, from time to time, offer and sell the
pledged shares.
Broker-dealers engaged by the selling stockholders may arrange for other
broker-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling stockholders in amounts to be negotiated.
The selling stockholders and any broker-dealers that act in connection with
the sale of the shares offered hereby might be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act, and any commissions
received by such broker-dealers and any profit on the resale of the shares
offered hereby sold by them while acting as principals might be deemed to be
underwriting discounts or commissions under the Securities Act. We have agreed
to indemnify certain selling stockholder against certain liabilities, including
liabilities arising under the Securities Act. The selling stockholders may agree
to indemnify any agent, dealer or broker-dealer that participates in
transactions involving sales of the shares offered hereby against certain
liabilities, including liabilities arising under the Securities Act.
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DESCRIPTION OF SECURITIES
General
We are authorized to issue 15,000,000 shares of common stock, par value
$.01 per share, of which 5,881,625 were issued and outstanding on January 28,
2002. We are also authorized to issue 5,000,000 shares of preferred stock, $.01
par value per share. No shares of preferred stock are currently outstanding.
Common Stock
The holders of shares of common stock have no preemptive rights and the
shares are not subject to redemption. Holders of common stock are not entitled
to cumulative voting.
Preferred Stock
We are authorized to issue 5,000,000 million shares of preferred stock, in
one or more classes or series as determined from time to time by the board of
directors.
The board of directors has the authority to issue shares of preferred stock
and to fix the number of shares and the relative rights, conversion rights,
voting rights and the terms of redemption, liquidation preferences and any other
preferences, special rights and qualifications of these preferred shares,
subject only to the limitations and restrictions contained in our certificate of
incorporation. No stockholder approval is needed. The board of directors is
empowered to issue preferred stock with rights that could adversely affect the
voting power or other rights of the holders of the common stock. In the event of
an issuance, the preferred stock could be utilized, under certain circumstances,
as a method of discouraging, delaying or preventing a change in control.
Certificate of Incorporation Anti-Takeover Provisions
Our certificate of incorporation contains several provisions which would
delay, defer or prevent a change of control from occurring. The board of
directors has the authority to issue preferred stock without stockholder
approval with any rights or preferences the board of directors determines.
Additionally, the stockholders of I.D. Systems are not permitted to act by
written consent, and are therefore only permitted to take corporate at annual or
special meetings. Special meetings of stockholders may only be called by:
o the board of directors pursuant to a resolution adopted by a majority
of the entire board of directors, either upon motion of a director or
upon written request by the holders of at least 50% of the voting
power of all the shares of capital stock of I.D. Systems entitled to
vote in the election of directors, voting as a single class, or
o the Chairman of the Board or the President of I.D. Systems.
In addition, the affirmative vote of at least 75% of the voting power of all the
shares of capital stock of I.D. Systems entitled to vote in the election of
directors, voting as a single class is required to amend or repeal the
provisions dealing with meetings of stockholders. These provisions make it more
difficult for someone attempting to effect a change in control to do so.
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Delaware Law Anti-Takeover Provision
We are subject to the provisions of Section 203 of the General Corporation
Law of the State of Delaware. In general, the DGCL prohibits a publicly-held
Delaware corporation from engaging in a "business combination" with an
"interested stockholder" for a period of three years after the date of the
transaction in which the person becomes an interested stockholder, unless the
business combination is approved in a prescribed manner. An "interested
stockholder" is a person who, together with affiliates and associates, owns, or
within the prior three years did own, 15% or more of the corporation's voting
stock. This provision could make it more difficult for an "interested
stockholder" to obtain control of us without the approval of the board of
directors.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is American Stock
Transfer & Trust Company.
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
Section 145 of the Delaware General Corporate Law provides, in general,
that a corporation incorporated under the laws of the State of Delaware may:
o indemnify any director, officer, employee or agent who worked directly
for it or who worked at its request for another enterprise and was or
is a party, or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, other than a
derivative action by or in the right of the corporation.
o indemnify against expenses, judgments, fines and amounts paid in
settlement actually and reasonably incurred by any of the
aforementioned people in connection with the action, suit or
proceeding if this person acted in good faith and in a manner this
person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action
or proceeding, the corporation had no reasonable cause to believe that
this person's conduct was unlawful.
o in the case of a derivative action, indemnify any person against
expenses actually and reasonably incurred by this person in connection
with the defense or settlement of the action or suit, if this person
acted in good faith and in a manner this person reasonably believed to
be in or not opposed to the best interests of the corporation.
However, no indemnification shall be made in respect of any claim,
issue or matter as to which this person shall have been adjudged to be
liable to the corporation, unless and only to the extent that the
Court of Chancery of the State of Delaware or any other court in which
the action was brought determines that this person is fairly and
reasonably entitled to indemnity for his/her expenses.
Our certificate of incorporation authorizes us to indemnify all persons
permitted to be indemnified under Section 145 of the Delaware General Corporate
Law, by bylaws, agreements or otherwise, to the fullest extent permitted under
Delaware law.
Insofar as indemnification for liabilities arising under the securities act
may be permitted to directors, officers and controlling persons of small
business issues pursuant to the foregoing provisions, or otherwise, we have been
advised that in the opinion of the Securities and Exchange Commission, such
indemnification is against public policy as expressed in the securities act and
is, therefore, unenforceable.
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WHERE YOU CAN FIND MORE INFORMATION ABOUT US
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
SEC's public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549.
Please call the SEC at 1-800-SEC-0330 for further information on the public
reference room. Our SEC filings are also available to the public from the SEC's
Website at "http://www.sec.gov."
We have filed with the SEC a registration statement on Form S-3 to register
shares of our common stock. This prospectus is part of that registration
statement and, as permitted by the SEC's rules, does not contain all the
information included in the registration statement. For further information with
respect to us and our common stock, you may refer to the registration statement
and to the exhibits and schedules filed as part of that registration statement.
You can review and copy the registration statement and its exhibits and
schedules at the public reference facilities maintained by the SEC as described
above. The registration statement, including its exhibits and schedules, is also
available on the SEC's web site.
This prospectus may contain summaries of contracts or other documents.
Because they are summaries, they will not contain all of the information that
may be important to you. If you would like complete information about a contract
or other document, you should read the copy filed as an exhibit to the
registration statement.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be a part of this prospectus, and information that we file later
with the SEC will automatically update or supersede this information. We
incorporate by reference the documents listed below and any future filing we
will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934:
o Annual Report on Form 10-KSB/A for the fiscal year ended December 31,
2000;
o Quarterly Report on Form 10-QSB for the quarter ended March 31, 2001;
o Quarterly Report on Form 10-QSB for the quarter ended June 30, 2001;
o Quarterly Report on Form 10-QSB for the quarter ended September 30,
2001; and
o Current Report on Form 8-K filed on April 19, 2001.
You may request a copy of these filings, at no cost, by writing to us at
our executive offices at One University Plaza Hackensack, New Jersey, 07601,
Attention: Ned Mavrommatis, or by calling us at (201) 670-9000.
LEGAL MATTERS
Jenkens & Gilchrist Parker Chapin LLP, New York, NY, has passed upon the
validity of the securities offered hereby.
EXPERTS
Richard A. Eisner & Company, LLP, independent auditors, have audited our
financial statements included in our Annual Report on Form 10-KSB for the year
ended December 31, 2000, as set forth in their report, which is incorporated by
reference in this prospectus. Our financial statements included in such annual
report are incorporated by reference in reliance on the report of Richard A.
Eisner & Company, LLP, given on their authority as experts in accounting and
auditing.
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We have not authorized any dealer,
salesperson or any other person to give any I.D. Systems, Inc.
information or to represent anything not contained in
this prospectus. You must not rely on any
unauthorized information. This prospectus does not
offer to sell or buy any shares in any jurisdiction
where it is unlawful. The information in this 903,375 SHARES OF
prospectus is current as of February 14, 2002. COMMON STOCK
__________________________
TABLE OF CONTENTS
Page
Risk Factors .......................................3
Special Information About
Forward Looking Statements..........................5
Use of Proceeds....................................6
Selling Stockholder ................................6
Plan of Distribution ...............................7 ____________________
Description of Securities...........................8
Indemnification for Securities PROSPECTUS
Act Liabilities.....................................9 ____________________
Where You Can Find More
Information About Us...............................10
Legal Matters......................................10
Experts ...........................................10
February 14, 2002
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