-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, C1GhRE8xYSvpJgNCULCth2IkdCTzbG4qH0Ee4Yz1sl0G9KNVcaGsHVCbed/qrrTj 6+XmlND86JN2bnvZSpe9ZA== 0000921895-04-001620.txt : 20041015 0000921895-04-001620.hdr.sgml : 20041015 20041015143633 ACCESSION NUMBER: 0000921895-04-001620 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20041015 DATE AS OF CHANGE: 20041015 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: GVI SECURITY SOLUTIONS INC CENTRAL INDEX KEY: 0001021444 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATIONS EQUIPMENT, NEC [3669] IRS NUMBER: 770436410 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-50323 FILM NUMBER: 041080806 BUSINESS ADDRESS: STREET 1: 1621 WEST CROSBY STREET 2: SUITE 104 CITY: CARROLLTON STATE: TX ZIP: 75006 BUSINESS PHONE: 9722457353 MAIL ADDRESS: STREET 1: 1621 WEST CROSBY STREET 2: SUITE 104 CITY: CARROLLTON STATE: TX ZIP: 75006 FORMER COMPANY: FORMER CONFORMED NAME: THINKING TOOLS INC DATE OF NAME CHANGE: 19960823 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: TEITELBAUM WILLIAM A CENTRAL INDEX KEY: 0001086392 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 507 FOREST AVE STREET 2: C/O NATIONAL RECORD MART INC CITY: CARNEGIE STATE: PA ZIP: 15106 BUSINESS PHONE: 4122766200 MAIL ADDRESS: STREET 1: 507 FOREST AVE STREET 2: C/O NATIONAL RECORD MART INC CITY: CARNEGIE STATE: PA ZIP: 15106 SC 13D/A 1 sc13da05742_10152004.htm SC 13D/A sec document 


                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549
                                 --------------

                                  SCHEDULE 13D
                                 (Rule 13d-101)

             INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
            TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
                                  RULE 13d-2(a)

                               (Amendment No. 1)1

                          GVI Security Solutions, Inc.
                          ----------------------------
                                (Name of Issuer)

                          Common Stock, $.001 Par Value
                          -----------------------------
                         (Title of Class of Securities)

                                    36242E101
                                    ---------
                                 (CUSIP Number)

                              William A. Teitelbaum
                                 4 Winston Court
                            Dix Hills, New York 11746
                                 (631) 493-0187
                                 --------------

                                    Copy to:

                               Sam Schwartz, Esq.
                 Olshan Grundman Frome Rosenzweig & Wolosky LLP
                                Park Avenue Tower
                               65 East 55th Street
                            New York, New York 10022
                                 (212) 451-2300
                                 --------------
                  (Name, Address and Telephone Number of Person
                Authorized to Receive Notices and Communications)

                                October 13, 2004
                                ----------------
             (Date of Event Which Requires Filing of This Statement)

     If the filing  person has  previously  filed a statement on Schedule 13G to
report the  acquisition  that is the subject of this Schedule 13D, and is filing
this  schedule  because  of Rule  13d-1(e),  13d-1(f)  or  13d-1(g),  check  the
following box / /.

     Note.  Schedules  filed in paper format shall include a signed original and
five copies of the schedule,  including  all exhibits.  See Rule 13d-7 for other
parties to whom copies are to be sent.

                         (Continued on following pages)

                              (Page 1 of 26 Pages)

- --------
1    The  remainder  of this  cover  page  shall be filled  out for a  reporting
person's  initial  filing on this  form with  respect  to the  subject  class of
securities,  and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.

     The  information  required on the remainder of this cover page shall not be
deemed to be "filed"  for the purpose of Section 18 of the  Securities  Exchange
Act of 1934 or otherwise  subject to the  liabilities of that section of the Act
but  shall be  subject  to all other  provisions  of the Act  (however,  see the
Notes).




- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 2 of 26 Pages
- --------------------------                    ----------------------------------


================================================================================
       1       NAME OF REPORTING PERSONS
               I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

                             William A. Teitelbaum
- --------------------------------------------------------------------------------
       2       CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*         (a) / /
                                                                         (b) / /
- --------------------------------------------------------------------------------
       3       SEC USE ONLY

- --------------------------------------------------------------------------------
       4       SOURCE OF FUNDS*

                     PF
- --------------------------------------------------------------------------------
       5       CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
               PURSUANT TO ITEM 2(d) OR 2(e)                                 / /

- --------------------------------------------------------------------------------
       6       CITIZENSHIP OR PLACE OR ORGANIZATION

                     USA
- --------------------------------------------------------------------------------
   NUMBER OF            7      SOLE VOTING POWER
    SHARES
  BENEFICIALLY                 14,143,932(1)
   OWNED BY
     EACH      -----------------------------------------------------------------
   REPORTING            8      SHARED VOTING POWER
 PERSON WITH
                               - 0 -
               -----------------------------------------------------------------
                        9      SOLE DISPOSITIVE POWER

                               14,143,932(1)
               -----------------------------------------------------------------
                        10     SHARED DISPOSITIVE POWER

                               - 0 -
- --------------------------------------------------------------------------------
       11      AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

                               14,143,932(1)
- --------------------------------------------------------------------------------
       12      CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
               SHARES*                                                      / /
- --------------------------------------------------------------------------------
       13      PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

                               46.8%
- --------------------------------------------------------------------------------
       14      TYPE OF REPORTING PERSON

                               IN
================================================================================

                     *SEE INSTRUCTIONS BEFORE FILLING OUT!

(1)  Does not include 4,037,637 shares of Common Stock issuable upon exercise of
     a warrant  held by the  Reporting  Person (the  "Warrant").  The  Reporting
     Person was advised by the Issuer  that the Warrant was not validly  issued.
     Pursuant to a Settlement  Agreement and General Release,  dated October 13,
     2004,  among the Issuer,  GVI  Security,  Inc.,  the  Reporting  Person and
     Alarmax  Distributors,  Inc., the Reporting Person  relinquished all claims
     with  respect to the Warrant and the Warrant was  cancelled.  See Item 5(c)
     hereof.





- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 3 of 26 Pages
- --------------------------                    ----------------------------------


          The following  constitutes  Amendment No. 1 ("Amendment No. 1") to the
Schedule 13D filed by the undersigned.  This Amendment No. 1 amends the Schedule
13D as specifically set forth herein.

     Item 3 is hereby amended and restated to read as follows:

Item 3.   SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.

          The shares of common stock of the Issuer (the  "Shares")  owned by the
Reporting  Person were  acquired as a result of the merger (the  "Merger")  of a
wholly  owned  subsidiary  of the Issuer  with GVI  Security,  Inc.,  a Delaware
corporation  ("GVI").  Under the terms of the Merger,  (i) GVI was the surviving
corporation  and became a  subsidiary  of the  Issuer,  (ii) the  holders of the
outstanding  common  stock  of  GVI  ("GVI  Shares")  immediately  prior  to the
effective time of the Merger received  shares of Series E Convertible  Preferred
Stock of the Issuer and (iii)  holders of options and  warrants to purchase  GVI
Shares received options to purchase Shares.  The form of the Merger Agreement is
attached hereto as Exhibit 1.

          Effective  upon  consummation  of the  Merger,  the  Reporting  Person
received 478,260.86 shares of the Issuer's Series E Convertible  Preferred Stock
in consideration for 110,000 GVI Shares.  Each share of Series E Preferred Stock
was convertible into 1,833.948  Shares.  Effective upon the Issuer's filing of a
Certificate of Amendment to its Certificate of  Incorporation  on April 12, 2004
that effectuated a reverse split of 1-for-65 Shares (the "Reverse  Split"),  the
Reporting Person's Series E Convertible Preferred Stock automatically  converted
into 13,493,932 Shares.

          The Reporting Person was issued a five (5) year warrant, dated May 10,
2000, to purchase 32,857 GVI Shares at an exercise price of $0.10 per share (the
"Warrant").  Pursuant to the terms of the  Warrant  and the Merger,  the Warrant
became  exercisable  for  4,030,637  Shares,  after giving effect to the Reverse
Split,  at an aggregate  exercise  price of  $3,285.70.  In February  2004,  the
Reporting  Person was informed by Issuer's counsel that (i) GVI has no record of
the Warrant,  (ii) that no such warrant was ever  presented  to,  reviewed by or
ultimately  authorized  by the Board of  Directors  of GVI and  (iii)  therefore
Issuer and GVI do not  believe  such  Warrant  exists.  On April 27,  2004,  the
Reporting  Person  delivered to Issuer a check in the sum of $3,285.70  together
with a notice of exercise form with respect to the exercise of the Warrant.  The
Issuer did not tender the Shares with respect to the exercise of the Warrant and
advised the Reporting  Person that the Warrant was invalid.  In accordance  with
the Settlement Agreement and General Release,  dated October 13, 2004, among the
Issuer, GVI Security, Inc., the Reporting Person and Alarmax Distributors,  Inc.
(the  "Agreement")   described  in  Item  5(c)  hereof,   the  Reporting  Person
relinquished  all  claims  of  ownership  of the  Warrant  and the  Warrant  was
cancelled.

          In accordance  with the  Agreement,  the  Reporting  Person was issued
650,000 Shares. See Item 5(a) hereof.

          The  Reporting   Person  acquired  his  GVI  Shares  in  May  2000  in
consideration for $275,000.  The Reporting Person was issued the Warrant,  dated
May 10, 2000, in  consideration  for services  rendered.  The  Reporting  Person
received  650,000  Shares on October  13, 2004 in partial  consideration  of the
release of all  claims  with  respect to the  Warrant  and  cancellation  of the





- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 4 of 26 Pages
- --------------------------                    ----------------------------------


Warrant.  See Item  5(c)  hereof  for  description  of the  material  terms  and
provisions of the Agreement.

     Item 4 is hereby amended to add the following:

Item 4.   PURPOSE OF TRANSACTION.

     On October 13, 2004,  650,000 Shares were issued to the Reporting Person by
the Issuer in accordance with Agreement. The Agreement further provides that the
Issuer shall  purchase from the  Reporting  Person up to  $10,000,000  of Shares
subject to the Issuer's completion of a private placement of its securities upon
the terms and conditions described in Item 5(c) hereof.

     Items 5(a) and (b) are hereby amended and restated to read as follows:

Item 5.   INTEREST IN SECURITIES OF THE ISSUER.

     (a) As of the date hereof,  the Reporting  Person owns  14,143,932  Shares,
constituting  approximately 46.8% of the Shares  outstanding.  The percentage is
based upon  30,253,879  Shares  outstanding  which  includes  29,603,879  Shares
outstanding  as reported in the Issuer's  Form 10-QSB for the  quarterly  period
ended June 30, 2004, filed with the Securities and Exchange Commission on August
23, 2004, plus 650,000 Shares issued to the Reporting  Person in accordance with
the Agreement described in Item 5(c) hereof.

     (b) The  Reporting  Person has sole power to vote and dispose of 14,143,932
Shares, constituting approximately 46.8% of the Shares outstanding.

     Item 5(c) is hereby amended to add the following:

     (c) On October 13, 2004,  the  Reporting  Person  entered into a Settlement
Agreement and General  Release (the  "Agreement")  by and among the Issuer,  GVI
Security,  Inc.,  a Delaware  corporation,  the  Reporting  Person  and  Alarmax
Distributors,  Inc. Pursuant to the Agreement, among other things, the Reporting
Person  relinquished  all claims with respect to the Warrant and the Warrant was
cancelled in consideration  for, among other things, (i) the issuance of 650,000
shares  of the  Issuer's  common  stock,  and (ii) the  Issuer's  obligation  to
purchase up to  $10,000,000  of the Reporting  Person's  Shares,  subject to the
Issuer's  completion of a private placement of its securities upon the terms and
conditions described in this Item.

          The material  terms and  provisions  of the Agreement  concerning  the
Issuer's  obligation  to  purchase  Shares  from the  Reporting  Person from the
proceeds of a Private  Placement (as defined in Section  5(c)(iv)  below) are as
follows:

                (i)  Upon  the  Issuer's   completion  of  a  Private  Placement
resulting in Net Proceeds (as defined  below) of $20 million or more, the Issuer
shall purchase from the Reporting Person  $10,000,000 of the Reporting  Person's
Shares at the same price per share of Shares  sold by the Issuer in the  Private
Placement  (with no value  allocated to any warrants  which may be issued in the
Private  Placement).  The purchase price and the consideration to be paid by the
Issuer  shall  consist of cash  payable at closing in the amount of $5.0 million
and a subordinated note (the "Note") in the principal amount of $5.0 million;




- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 5 of 26 Pages
- --------------------------                    ----------------------------------


PROVIDED,  HOWEVER,  for each  dollar  of Net  Proceeds  raised  in the  Private
Placement in excess of $20 million and less than $25 million the cash portion of
the purchase  price shall be increased by $0.50 and the principal  amount of the
Note shall be  decreased  by $0.50;  provided,  further,  for each dollar of Net
Proceeds raised in the Private Placement of $25 million or more and less than or
equal  to $27.5  million,  the  cash  portion  of the  purchase  price  shall be
increased  by $1.00 and the  principal  amount of the Note shall be decreased by
$1.00.  Notwithstanding  anything to the contrary in the Agreement, in the event
the price per share of the  Shares  sold in any  Private  Placement  is $1.75 or
less,  the Reporting  Person shall not be obligated to sell any of his Shares to
the Issuer.  "Net  Proceeds" for purposes of the Agreement  shall mean the gross
proceeds  from the sale of  securities  in the Private  Placement  less the cash
commission  compensation  payable  to  the  placement  agent  for  such  Private
Placement.

               (ii) Upon the  completion  by the  Issuer of a Private  Placement
raising Net Proceeds of less than $20 million,  the Issuer shall  purchase  from
the Reporting  Person such number of his Shares as may be purchased  with 50% of
the Net  Proceeds of the Private  Placement at the same price per Share (with no
value  allocated to any warrants  which may be issued in the Private  Placement)
sold  by the  Issuer  in the  Private  Placement.  The  purchase  price  and the
consideration  to be paid by the Issuer  shall  consist  of (x) cash  payable at
closing  in the  amount of 50% of the  aggregate  purchase  price of the  Shares
required to be purchased  under this paragraph (25% of the Net Proceeds) and (y)
a note in the principal  amount of 50% of the aggregate  purchase  price of such
Shares (25% of the Net  Proceeds).  Notwithstanding  anything to the contrary in
the  Agreement,  in the event the price per share of the  Shares in any  Private
Placement is $1.75 or less, the Reporting  Person shall not be obligated to sell
any of his Shares to the Issuer in accordance with this paragraph.

               (iii) In the  event  that  less than  $650,000  of the  Reporting
Person's  Shares are purchased  pursuant to the Agreement by March 31, 2005 (the
"Purchase  Deadline"),  the Issuer, at the option of the Reporting Person, shall
purchase from the Reporting Person, such number of additional Shares, or 650,000
Shares in the event no Shares have been purchased by the Purchase Deadline, at a
purchase  price of $1.00 per share  (subject to adjustment  for any stock split,
recapitalization,  combination or similar event  effecting the Shares  occurring
after the date hereof). The Reporting Person shall deliver written notice to the
Issuer upon his election for the Issuer to purchase such Shares not later than 3
business  days  after the  Purchase  Deadline.  Any  purchase  by the  Issuer in
accordance  with this  Section  5(c)(iii)  shall not be  counted  toward  the 4%
limitation  in the lock-up  provisions of Section 6 of the  Registration  Rights
Agreement, dated February 19, 2004, between the Issuer, the Reporting Person and
certain other shareholders (the "Registration Rights Agreement").

               (iv) For purposes of the Agreement,  the term "Private Placement"
shall mean the Private  Placement of up to $30 million of the Issuer's Shares or
one or more  sales by the Issuer of its Shares or  securities  convertible  into
Shares  consummated  no later  than  March 31,  2005 for the  purpose of raising
equity capital; PROVIDED,  HOWEVER, the term Private Placement shall not include
any issuance or sale of (i)  securities to Laurus Master Fund, Ltd ("Laurus") or
its  affiliates  in  connection  with  conversion  of debt with  respect  to the
financing completed on May 27, 2004 with Laurus or additional sums borrowed from
Laurus in accordance with the $5 million Secured Revolving Note and the accounts
receivable  facility  as set forth in that  certain  Security  Agreement  by and
between the Issuer and Laurus dated May 27, 2004, (ii) debt securities exclusive




- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 6 of 26 Pages
- --------------------------                    ----------------------------------


of any  equity  securities  or  securities  convertible  into  equity  or  (iii)
securities in connection with any bridge financing consummated prior to December
21,  2004 in  anticipation  of either  the (A)  private  placement  of up to $30
million Shares in which C.E. Unterberg,  Towbin LLC acts as placement agent (the
"Unterberg  Private  Placement") or (B) a Private Placement in which Oppenheimer
or its affiliates acts as placement agent.

                (v) The  indebtedness  of the  Issuer  and GVI to the  Reporting
Person under the Note shall be  subordinated  to the  indebtedness of the Issuer
and GVI to Lauras in accordance  with a subordination  agreement,  to be entered
into by the  Issuer,  GVI,  the  Reporting  Person  and  Lauras  (to the  extent
applicable)  at the  closing  with  respect  to the  purchase  of the  Shares in
accordance with the Agreement.

               (vi) The Agreement  contains  certain  lock-up  provisions  which
restrict the Reporting Person's ability to sell his Shares as follows:

               (A)  Commencing  on October 15, 2004,  the  effectiveness  of the
Issuer's Registration  Statement on Form SB-2 filed with the SEC on July 1, 2004
(the  "Registration  Statement"),  the  Reporting  Person  has  agreed  that  he
(including  any  affiliate  of  entities)  will not,  without the consent of the
Issuer,  sell, offer for sale,  contract to sell, pledge or otherwise dispose of
any his Shares currently owned or hereafter  acquired by the Reporting Person or
affiliates  until a date which is fifteen  (15) months  after the closing of the
Private  Placement  (the  "Lock-Up  Termination  Date").  Following  the Lock-Up
Termination Date, the Reporting Person shall no longer be subject to the lock-up
provisions  set forth in  Section 6 of the  Registration  Rights  Agreement.  In
addition,  in the  event  that  there is no  closing  of the  Private  Placement
resulting  in the  purchase  by the  Issuer  of at  least  $5.0  million  of the
Reporting Person's Shares in accordance with the Agreement ($2.5 million in cash
and $2.5 million  principal amount of the Note) by December 31, 2004 (the "Early
Termination  Date"),  the  Reporting  Person  shall no longer be  subject to the
fifteen (15) month lock-up set forth above.  The Issuer has also agreed that the
current  lock-up  provisions set forth in Section 6 of the  Registration  Rights
Agreement  will not be amended to reduce  the Shares  available  for sale by the
Reporting Person below 4% in any 90-day period; and

                    (B) The lock-up  restrictions  during the period between the
effectiveness  of the  Registration  Statement  until the closing of the Private
Placement  pertaining  to the  Reporting  Person as set forth in (A) above  (the
"Private Placement Restriction Period") are specifically subject to an amendment
to the Registration  Rights Agreement which has been duly executed by holders of
a majority of the Registrable  Securities (as defined in the Registration Rights
Agreement)  restricting  each  signatory to the  Registration  Rights  Agreement
(except Europa International Inc. and Thinking Technologies,  L.P.) from selling
any  securities of the Issuer during the Private  Placement  Restriction  Period
(the  "Majority  Holders  Lock-up").  In addition,  the Early  Termination  Date
(December  31,  2004) may be extended by the Issuer  from  December  31, 2004 to
March 31, 2005 (such period the "Extension Period") if (i) beginning at December
31, 2004 the Issuer  continues to use commercially  reasonable  efforts to offer
and sell  securities in the  Unterberg  Private  Placement  during the Extension
Period and (ii) the  Registration  Rights Agreement is further amended to extend
the Majority Holders Lock-up to be restricted from selling any securities of the
Issuer owned by them during the Extension Period.





- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 7 of 26 Pages
- --------------------------                    ----------------------------------


The Issuer  shall  provide  the  Reporting  Person with (x)  reasonable  written
notice,  no later than January 6, 1005,  if it decides to exercise the Extension
Period and (y)  reasonable  documentation  that the  conditions set forth in the
preceding sentence have been satisfied.

               (vii) The Agreement  further provided for the exchange of general
releases between the Issuer and the Reporting Person.

               (viii)  The  Agreement  also  provided  for the  settlement  of a
lawsuit against the Issuer commenced by Alarmax Distributors,  Inc. ("Alarmax"),
an entity of which the Reporting Person is the majority  stockholder,  in which,
among other  things,  Alarmax  disputed the  validity of an accounts  receivable
Issuer  claimed due from  Alarmax and also  alleged that the Issuer had breached
certain provisions of a Supplier Agreement between the parties,  dated April 30,
2001.  In  accordance  with the  Agreement,  Alarmax  paid the Issuer the sum of
$145,000  in full  settlement  of the  litigation,  and the Issuer  and  Alarmax
exchanged releases with respect to the litigation.

          Other than as  described  herein,  there were no  transactions  by the
Reporting Person in the Issuer's Shares during the past sixty days.

     Item 6 is hereby amended to add the following:

Item 6.   CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH  RESPECT
          TO SECURITIES OF THE ISSUER.

          See  the  disclosure   under  Item  5(c)  hereof  with  respect  to  a
description of the material terms and provisions of the Settlement Agreement and
General Release, dated October 13, 2004 between the Issuer, GVI Security,  Inc.,
the Reporting Person and Alarmax.

     Item 7 is hereby amended to add the following:

Item 7.   MATERIAL TO BE FILED AS EXHIBITS.

          4.    Settlement  Agreement and General  Release,  dated as of October
                13,  2004,  by and  among  GVI  Security  Solutions,  Inc.,  GVI
                Security,  Inc., William A. Teitelbaum and Alarmax Distributors,
                Inc.





- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 8 of 26 Pages
- --------------------------                    ----------------------------------


                                    SIGNATURE

          After reasonable  inquiry and to the best of his knowledge and belief,
the  undersigned  certifies that the  information set forth in this statement is
true, complete and correct.


Dated:    October 15, 2004




                                                  /s/ William A. Teitelbaum
                                                  ------------------------------
                                                  William A. Teitelbaum





- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                          Page 9 of 26 Pages
- --------------------------                    ----------------------------------


                                  EXHIBIT INDEX

       Exhibit                                                        Page
       -------                                                        ----

1.     Form of Agreement and Plan of Merger, dated
       as of  February  20,  2004,  by  and  among
       Thinking   Tools,    Inc.,   GVI   Security
       Acquisition  Corp.  and GVI Security,  Inc.
       (previously filed).                                             --

2.     Warrant to purchase 32,857 shares of common
       stock of GVI Security,  Inc., dated May 10,
       2000 (previously filed).                                        --

3.     Form  of  Registration   Rights  Agreement,
       dated as of February 19, 2004, by and among
       Thinking  Tools,   Inc.  and  each  of  the
       stockholders of Thinking Tools, Inc. listed
       on Schedule 1 to the agreement  (previously
       filed).                                                         --



4.     Settlement  Agreement  dated as of  October
       13,   2004,   by  and  among  GVI  Security
       Solutions,   Inc.,   GVI  Security,   Inc.,
       William   A.    Teitelbaum    and   Alarmax
       Distributors, Inc.                                            10-26






- --------------------------                    ----------------------------------
CUSIP No. 36242E101              13D                         Page 10 of 26 Pages
- --------------------------                    ----------------------------------




                    SETTLEMENT AGREEMENT AND GENERAL RELEASE


     This Agreement (this "AGREEMENT") is made as of the 13th day of October,
2004, by and among GVI Security Solutions, Inc., a Delaware corporation
("GVIS"), GVI Security, Inc., a Delaware corporation ("GVI" and, together with
GVIS, the "COMPANIES"), William A. Teitelbaum ("TEITELBAUM") and Alarmax
Distributors, Inc. ("ALARMAX").

                               W I T N E S S E T H

     WHEREAS, Teitelbaum is the holder of 13,493,932 shares of the common stock,
par value $.001 per share (the "COMMON STOCK") of GVIS (the "TEITELBAUM INITIAL
SHARES");

     WHEREAS, Teitelbaum contends that on May 10, 2000 he was issued a five year
warrant to purchase 32,857 shares of common stock of GVI, at an exercise price
of $0.10 per share (the "WARRANT"), which Warrant is currently exercisable for
4,030,637 shares of Common Stock (after giving effect to the subsequent
one-for-65 reverse stock split) at an aggregate exercise price of $3,285.70;

     WHEREAS, the Companies dispute the validity of the Warrant;

     WHEREAS, Alarmax commenced an action against GVIS in the Court of Common
Pleas of Allegheny County, Pennsylvania, at GD-04-9170 which GVIS has removed to
the United States District Court for the Western District of Pennsylvania (the
"COURT") at 04-CV-0844 (the "ACTION") in which, among other things, Alarmax
disputes the validity of the Receivable and alleges that GVIS has breached
certain provisions of that certain Supplier Agreement dated as of April 30, 2001
(the "SUPPLY AGREEMENT");

     WHEREAS, GVI has denied all liability in the Action and has asserted a
counterclaim (the "COUNTERCLAIM") against Alarmax asserting that Alarmax is
obligated to GVI in the amount of approximately $203,000 in respect of certain
goods sold to Alarmax by GVI (such obligation, the "RECEIVABLE");

     WHEREAS, GVIS has entered into a letter agreement dated August 5, 2004 with
C.E. Unterberg, Towbin LLC, relating to the private placement of up to $30
million of GVIS Common Stock (the "UNTERBERG PRIVATE PLACEMENT");

     WHEREAS, upon the terms and subject to the conditions set forth herein GVIS
desires to use a portion of the proceeds from the Private Placement to purchase
from Teitelbaum, and Teitelbaum desires to sell to GVIS, up to $10 million of
the Teitelbaum Initial Shares;

     WHEREAS, GVI is the wholly owned subsidiary of GVIS;

     WHEREAS, Teitelbaum is the principal stockholder of Alarmax; and

     WHEREAS, the parties desire to resolve any controversy between them upon
the terms set forth in this Agreement.





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CUSIP No. 36242E101              13D                         Page 11 of 26 Pages
- --------------------------                    ----------------------------------

     NOW, THEREFORE,  in consideration of the foregoing, of the mutual promises,
releases,  representations,  covenants and obligations hereinafter set forth and
for other good and valuable consideration,  the receipt and sufficiency of which
are hereby  acknowledged,  the parties  hereto,  intending to be legally  bound,
hereby agree as follows:

     1. SHARES  DELIVERY.  GVIS shall  deliver to Teitelbaum  650,000  shares of
Common Stock (the "SETTLEMENT  SHARES" and together with the Teitelbaum  Initial
Shares, the "TEITELBAUM SHARES").

     2. RECEIVABLE SETTLEMENT.  Concurrently herewith,  Alarmax shall pay to GVI
$145,000 in full settlement of the Receivable.

     3. AMENDMENT OF 13D.  Teitelbaum  hereby  covenants and agrees to file with
the Securities and Exchange Commission ("SEC"),  immediately  following the date
hereof,  an  amendment  to the Schedule 13D filed with the SEC on March 1, 2004,
and a Form 4, which filings shall disclose that  Teitelbaum's  ownership of GVIS
securities consists solely of 14,143,932 shares of Common Stock.

     4.  BMW.  No later  than  thirty  (30)  days  following  the  date  hereof,
Teitelbaum   shall   return   to  GVI   that   certain   BMW   automobile   (VIN
5UXFA53512LP46193) (the "BMW") financed by GVI.

     5. RELEASE AND COVENANT BY TEITELBAUM AND ALARMAX.

          (a) Concurrently  herewith,  Teitelbaum on his behalf and on behalf of
any and all entities controlled by Teitelbaum, exclusive of Alarmax, voluntarily
releases  and forever  discharges  each of the  Companies  and their  respective
subsidiaries,  affiliates, directors, officers, employees,  shareholders, agents
and  representatives,  and each of  their  successors  and  assigns  (the  "GVIS
RELEASEES")  from, and covenants not to sue or proceed  against (or to encourage
or induce any other person or entity to sue or proceed  against) any of the GVIS
Releasees  on the basis of,  any and all  claims,  contentions,  rights,  debts,
liabilities,  demands,  accounts,  reckonings,  obligations,  duties,  promises,
costs,  expenses  (including,  but not  limited  to,  attorneys'  fees),  liens,
damages,  losses,  actions,  and  causes  of  action,  of  any  kind  whatsoever
(hereinafter referred to as "CLAIMS") whether due or owing in the past, asserted
or not, present or future and whether based upon contract,  tort, statute or any
other legal or  equitable  theory of  recovery,  and  whether  known or unknown,
suspected  or  unsuspected,  fixed or  contingent,  matured or  unmatured,  with
respect to, pertaining to, or arising from any matters, acts, omissions, events,
conduct  or  occurrences  at any  time  prior  to the  date of  this  Agreement,
including,  without limiting the generality of the foregoing provisions, any and
all causes of action or Claims which were  asserted or could have been  asserted
in connection with the Warrant,  the Action, his employment with GVI, the Action
or the Supply  Agreement;  but excluding any Claims arising out of or related to
any  breach of this  Agreement,  the Note (as  defined  herein)  (to the  extent
applicable),  the  Subordination  Agreement  (as defined  herein) (to the extent
applicable) or that certain  Registration  Rights  Agreement  dated February 19,
2004,  as  amended  from  time to  time,  between  GVIS,  Teitelbaum  and  other
signatories thereto (the "REGISTRATION RIGHTS AGREEMENT"). Teitelbaum represents
and warrants to each of the GVIS Releasees that  Teitelbaum has not  transferred
or assigned any such Claims to any other person or entity.



                                       2




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CUSIP No. 36242E101              13D                         Page 12 of 26 Pages
- --------------------------                    ----------------------------------


          (b) Concurrently herewith, Alarmax on its behalf and on behalf of any
and all entities controlled by it, voluntarily releases and forever discharges
the GVIS Releasees from, and covenants not to sue or proceed against (or to
encourage or induce any other person or entity to sue or proceed against) any of
the GVIS Releasees on the basis of, any and all Claims, whether due or owing in
the past, asserted or not, present or future and whether based upon contract,
tort, statute or any other legal or equitable theory of recovery, and whether
known or unknown, suspected or unsuspected, fixed or contingent, matured or
unmatured, with respect to, pertaining to, or arising from any matters, acts,
omissions, events, conduct or occurrences at any time prior to the date of this
Agreement, including, without limiting the generality of the foregoing
provisions, any and all causes of action or Claims, arising out of or related to
the Supply Agreement, the Action, the disputed Receivable, and alleged breach of
the Supply Agreement for which Alarmax asserted claims against GVI in the Action
and the Counterclaim. This release specifically excludes any Claims arising out
of or related to any breach of this Agreement. This release further excludes any
and all Claims against the GVIS Releasees which are in any way related to, or
arise out of, claims by third parties concerning the products of the Companies
supplied to Alarmax pursuant to the Supply Agreement ("PRODUCT AND WARRANTY
CLAIMS"), including, but not limited to, warranty claims (express or implied),
negligence claims, product defect claims, claims for contribution and indemnity,
claims for business loss, business interruption, personal injury and/or property
damage, and any other tort, contract, statutory and/or equitable claim and/or
claims arising out of Section 6 or 7 of the Supply Agreement. It is further
agreed that (x) the preceding sentence is a reservation of rights that Alarmax
may have under the Supply Agreement and at law or otherwise and is not intended
to provide Alarmax with any additional rights and remedies, and (y) Alarmax
expressly reserves and does not release any and all of such Product and Warranty
Claims against the GVIS Releasees. Within five days of the date hereof, Alarmax
shall file a Stipulation with the Court to have the Action dismissed with
prejudice and take such other action and file such other documents with the
Court as shall be necessary to terminate the Action.

     6. RELEASE AND COVENANT NOT TO SUE BY THE COMPANIES.

          (a) Concurrently herewith, each of the Companies, on their behalf and
on behalf of any and all entities controlled by them, respectively, voluntarily
releases and forever discharges Teitelbaum and each entity controlled by him
other than Alarmax, from, and covenants not to sue or proceed against Teitelbaum
on the basis of, any and all Claims, whether due or owing in the past, present
or future and whether based upon contract, tort, statute or any other legal or
equitable theory of recovery, and whether known or unknown, suspected or
unsuspected, fixed or contingent, matured or unmatured, with respect to,
pertaining to, or arising from any matters, acts, omissions, events, conduct or
occurrences at any time prior to the date of this Agreement, including, without
limiting the generality of the foregoing provisions, any and all causes of
action or Claims which were asserted or could have been asserted in connection
with the Warrant, the Action, Teitelbaum's employment with GVI, or the Supply
Agreement; but excluding any Claims arising out of or related to (i) any breach
of this Agreement, the Note (to the extent applicable), the Subordination
Agreement (to the extent applicable) or the Registration Rights Agreement, and
(ii) the BMW or the finance agreement with respect to the BMW, except for
regular monthly payments due under the finance agreement through the delivery of
the BMW in accordance with Section 4 hereof. Each of the Companies represents
and warrants to Teitelbaum that neither GVIS nor GVI has transferred or assigned



                                       3




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CUSIP No. 36242E101              13D                         Page 13 of 26 Pages
- --------------------------                    ----------------------------------


any such Claims to any other person or entity.

          (b) Concurrently herewith, the Companies on their behalf and on behalf
of any and all entities controlled by them, voluntarily releases and forever
discharges Alarmax and its respective subsidiaries, affiliates, directors,
officers, employees, shareholders, agents and representatives, and each of their
successors and assigns (the "ALARMAX RELEASEES") from, and covenants not to sue
or proceed against (or to encourage or induce any other person or entity to sue
or proceed against) any of the Alarmax Releasees on the basis of, any and all
Claims, whether due or owing in the past, asserted or not, present or future and
whether based upon contract, tort, statute or any other legal or equitable
theory of recovery, and whether known or unknown, suspected or unsuspected,
fixed or contingent, matured or unmatured, with respect to, pertaining to, or
arising from any matters, acts, omissions, events, conduct or occurrences at any
time prior to the date of this Agreement, including, without limiting the
generality of the foregoing provisions, any and all causes of action or Claims,
arising out of or related to the Supply Agreement, the Action, the disputed
Receivable, and alleged breach of the Supply Agreement for which Alarmax
asserted claims against GVI in the Action and the Counterclaim. This release
specifically excludes any Claims arising out of or related to any breach of this
Agreement. This release further excludes any and all Product and Warranty Claims
against the Alarmax Releases which are in any way related to, or arise out of,
claims concerning the products of the Companies, including, but not limited to,
warranty claims (express or implied), negligence claims, product defect claims,
claims for contribution and indemnity, claims for business loss, business
interruption, personal injury and/or property damage, and any other tort,
contract, statutory and/or equitable claim and/or claims arising out of Section
6 or 7 of the Supply Agreement. It is further agreed that (x) the preceding
sentence is a reservation of rights that the Companies may have under the Supply
Agreement and at law or otherwise and is not intended to provide the Companies
with any additional rights and remedies and (y) the Companies expressly reserve
and do not release any and all such Product and Warranty Claims against the
Alarmax Releasees.

     7. CONFIDENTIALITY OF AGREEMENT. Except as may be required by law
(including in any securities filings by GVIS or Teitelbaum), the terms and
conditions of this Agreement are and shall be deemed confidential and shall not
be disclosed by the Companies, Teitelbaum or Alarmax to any other person or
entity, except to accountants, tax advisors or immediate family members,
provided they agree to maintain the confidentiality of this Agreement.

     8. NON-DISPARAGEMENT. Each of the parties hereto agrees not to publish or
communicate to any person or entity any Disparaging (as defined below) remarks,
comments or statements concerning the other parties and/or their present and
former respective members, managers, partners, director, shareholders, officers,
employees, agents, attorneys, successors and assigns. "Disparaging" remarks,
comments or statements are those that impugn the character, honesty, integrity
or morality or business acumen or abilities in connection with any aspect of the
operation of business of the individual or entity being disparaged.

     9. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANIES.



                                       4




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CUSIP No. 36242E101              13D                         Page 14 of 26 Pages
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          (a) Each of the Companies hereby jointly and severally  represents and
warrants to Teitelbaum and Alarmax that:

              (i) Each of the Companies has the requisite power and authority
          and legal capacity to enter into this Agreement and to carry out its
          obligations thereunder and to consummate the transactions contemplated
          hereby. All necessary corporate proceedings of the Companies have been
          duly taken to authorize the execution, delivery and performance of
          this Agreement, including, without limitation, the approval by the
          Board of Directors of GVIS. This Agreement has been duly and validly
          executed and delivered by each of the Companies and constitutes the
          legal, valid and binding agreement of each of the Companies,
          enforceable against each of them in accordance with its terms. Except
          for the required amendment to the lock-up provision of the
          Registration Rights Agreement permitting Teitelbaum's sale of the
          Teitelbaum Shares to GVIS as provided herein, no consent of any party
          to any contract, agreement, instrument, or understanding to which any
          of the Companies is a party, or by which any of their properties or
          assets is bound, is required for the execution, delivery or
          performance by the Companies of this Agreement and to consummate the
          transactions contemplated hereby.

             (ii) None of the execution and delivery by either of the
          Companies of this Agreement, the performance of its obligations
          hereunder or the consummation of the transactions contemplated hereby
          will (1) conflict with the Certificate of Incorporation or Bylaws of
          the Companies, (2) violate, result in the breach of or conflict with
          any law, rule, regulation order, judgment or decree binding on the
          Companies or which any of their operations, business, properties or
          assets is subject or (3) with or without notice, the passage of time
          or both, constitute a breach or violation of, be in conflict with or
          constitute or create a default under any material agreement to which
          either of the Companies is a party or by which either of them or any
          of their respective properties are bound.

          (b) GVIS represents and warrants to Teitelbaum that the Settlement
Shares have been duly authorized by GVIS and, when issued and delivered in
accordance with the terms of this Agreement, will be validly issued and
delivered and fully paid and nonassessable shares of Common Stock.

          (c) GVIS has filed all forms, reports, statements and other documents
required by law to be filed with the SEC including, without limitation, (1) all
Annual Reports on Form 10-KSB, (2) all Quarterly Reports on Form 10-QSB, (3) all
Reports on Form 8-K, (4) all other reports or registration statements and (5)
all amendments and supplements to all such reports and registration statements
(collectively referred to as the "REPORTS"). The Reports (i) were prepared in
all material respects in accordance with the requirements of applicable law
(including the Securities Act of 1933, as amended (the "SECURITIES ACT"), and
the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), as the
case may be, and the rules and regulations of the SEC thereunder applicable to
such Reports) and (ii) to the Company's knowledge, did not at the time they were
filed contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading. In addition, since the last quarterly report of GVIS on
Form 10-QSB filed with the SEC on August 23, 2004, there have been no material



                                       5




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CUSIP No. 36242E101              13D                         Page 15 of 26 Pages
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events  that  require  disclosure  under  the  Exchange  Act that  have not been
disclosed.

          (d) GVIS has provided Teitelbaum with copies of all comment letters
from the SEC with respect to the Registration Statement on Form SB-2 (File No.
333-117064) (the "REGISTRATION STATEMENT") and advised Teitelbaum as to the
status of the Registration Statement and GVIS shall continue to keep Teitelbaum
advised of such matters. Teitelbaum acknowledges that such information may be
material non-public information. Teitelbaum confirms to GVIS that he is aware
that the United States securities laws restrict persons with material non-public
information about a company obtained directly or indirectly from that company or
from a person or entity having a fiduciary relationship or contractual
non-disclosure arrangement or agreement with that company from purchasing or
selling securities (or any interests therein) of such company, or from
communicating such information to any other person under circumstances in which
he is reasonably foreseeable that such person is likely to purchase or sell such
securities (or any interests therein). Teitelbaum hereby confirms that he is
aware of its responsibilities under such securities laws.

          (e) GVIS covenants and agrees that there will be no selling
stockholders with respect to the Unterberg Private Placement or any other
Private Placement and that except for the purchase of the Teitelbaum Initial
Shares none of the proceeds of the Unterberg Private Placement or any other
Private Placement will be used to repurchase any outstanding GVIS securities
except that such proceeds may be used to repay securities issued in a bridge
financing consummated in anticipation of a Private Placement.

          (f) GVIS represents and warrants that as of the date hereof it has
provided Teitelbaum with true, complete and correct copies of the engagement
letter and term sheet (each dated August 5, 2004) with respect to the Unterberg
Private Placement, and, except as may be amended by this Agreement and with
respect to the lock-up provisions, such documents have not as of the date hereof
been amended, modified, supplemented or superseded (orally or in writing). GVIS
further represents and warrants that as of the date hereof it has not been
notified by C.E. Unterberg, Towbin LLC, either orally or in writing, that the
Unterberg Private Placement shall not proceed.

     10. REPRESENTATIONS, WARRANTIES AND COVENANTS OF TEITELBAUM.

          (a) Teitelbaum represents and warrants to each of the Companies that

             (i) he is the sole owner of all rights, title and interest in and
          to the Teitelbaum Initial Shares and the Warrant free and clear of all
          Liens (as defined in Section 13 below);

            (ii) subject to the lock-up provision of the Registration Rights
          Agreement, which shall be (or has been) amended to permit Teitelbaum's
          sale of the Teitelbaum Shares to GVIS as provided herein, Teitelbaum
          has the unrestricted right to sell, assign, transfer, convey and
          deliver to GVIS all right, title and interest in and to the Teitelbaum
          Shares without penalty or other adverse consequences, and upon the
          closing of any Teitelbaum Sale, GVIS will own the Teitelbaum Shares
          free and clear of all Liens;



                                       6




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CUSIP No. 36242E101              13D                         Page 16 of 26 Pages
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               (iii) he does not own, beneficially or otherwise, direct or
          indirectly, and has no claims to own, any equity interest or interest
          convertible into an equity interest in the Companies other than the
          Teitelbaum Shares and the Warrant, and he has no preemptive rights,
          rights of first refusal or similar rights with respect to any
          securities of the Companies; and

               (iv) that the Settlement Shares are being acquired for his own
          account and not with a view to distribution within the meaning of the
          Securities Act

          (b) Notwithstanding any rights Teitelbaum may have pursuant to the
Registration Rights Agreement or otherwise, Teitelbaum covenants and agrees that
as of the earlier of (i) the effectiveness of the Registration Statement and
(ii) the closing of the Private Placement, he will not, without the consent of
GVIS, offer, sell, contract to sell, pledge or otherwise dispose of, file (or
enter into any transaction which is designed to, or might reasonably be expected
to, result in the disposition (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) by Teitelbaum or any
of his affiliates or any person in privity with Teitelbaum or any of his
affiliates), directly or indirectly, including the filing or participation in
the filing of a registration statement with the SEC in respect of, or establish
or increase a put equivalent position or liquidate or decrease a call equivalent
position within the meaning of Section 16 of the Securities Exchange Act of
1934, as amended, and the rules and regulations of the SEC promulgated
thereunder with respect to, any shares of Common Stock of GVIS or any securities
convertible into or exercisable or exchangeable for such Common Stock, now owned
or hereafter acquired by Teitelbaum or any of his affiliates, including the
Teitelbaum Initial Shares and the Settlement Shares, or publicly announce an
intention to effect any such transaction, until the date which is fifteen months
after the closing of the Private Placement (the "LOCK-UP TERMINATION DATE").
GVIS may impose stock transfer instructions with respect to such shares of
Common Stock to enforce Teitelbaum's obligations under this Section 10(b). After
the Lock-up Termination Date, Teitelbaum covenants and agrees that all sales
shall be made pursuant to registration under the Securities Act and applicable
state securities laws or an applicable exemption from such registration. The
Company agrees that after the Lock-up Termination Date, Teitelbaum shall no
longer be bound by the lock-up provisions then in effect pursuant to the
Registration Rights Agreement. In the event that there is no closing of the
Private Placement resulting in the purchase in accordance with Section 13 hereof
by GVIS of at least $5 million of Teitelbaum Initial Shares ($2.5 million in
cash and $2.5 million in principal amount of the Note) by the Early Termination
Date, Teitelbaum shall no longer be subject to the lock-up provisions contained
in this Section 10(b) and he shall be free to sell the Teitelbaum Initial Shares
and the Settlement Shares subject to the terms of the Registration Rights
Agreement and the lock-up provisions of Section 6 thereof. The Early Termination
Date shall be December 31, 2004, unless extended as set forth in Section 10(c).
Prior to the date hereof, GVIS has provided Teitelbaum with copies of all
amendments to the Registration Rights Agreement and GVIS agrees, that, without
the written consent of Teitelbaum, the lock-up provisions set forth in Section 6
of the Registration Rights Agreement will not be further amended to reduce the
percentage of shares available for sale by Teitelbaum below 4% in any 90-day
period.



                                       7




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CUSIP No. 36242E101              13D                         Page 17 of 26 Pages
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          (c) In the event that the effectiveness of the Registration Statement
occurs before the closing of the Private Placement, the lock-up restrictions
during the period between the effectiveness of the Registration Statement until
the closing of the Private Placement pertaining to Teitelbaum as set forth in
Section 10(b) hereof (the "PRIVATE PLACEMENT RESTRICTION PERIOD") are
specifically subject to an amendment to the Registration Rights Agreement which
has been duly executed by holders of a majority of the Registrable Securities
(as defined in the Registration Rights Agreement) restricting each signatory to
the Registration Rights Agreement (except Europa International, Inc. and
Thinking Technologies, L.P.), from selling any securities of GVIS during the
Private Placement Restriction Period (the "MAJORITY HOLDERS LOCK-UP"). A copy of
the executed amendment been provided to counsel for Teitelbaum. The limitations
described in the preceding sentence shall in no way limit the lock-up
restrictions contained in Section 10(b) hereof following the closing of a
Private Placement. Further, the Early Termination Date may be extended by GVIS
from December 31, 2004 to March 31, 2005 (such period the "EXTENSION PERIOD") if
(i) beginning at December 31, 2004 GVIS continues to use commercially reasonable
efforts to offer and sell securities in the Unterberg Private Placement during
the Extension Period or GVIS has entered in an engagement letter with another
placement agent no later than December 31, 2004 with respect to a Private
Placement of GVIS securities and is using commercially reasonable efforts to
offer and sell the securities in the Private Placement during the Extension
Period and (ii) the Registration Rights Agreement is further amended to extend
the Majority Holders Lock-up to be restricted from selling any securities of
GVIS owned by them during the Extension Period. GVIS shall provide Teitelbaum
with (x) reasonable written notice, no later than January 6, 2005, if it decides
to exercise the Extension Period and (y) reasonable documentation that the
conditions set forth in the preceding sentence have been satisfied.

     11. REPRESENTATIONS AND WARRANTIES OF ALARMAX. Alarmax hereby represents
and warrants to each of the Companies that:

          (a) Alarmax has the requisite power and authority and legal capacity
to enter into this Agreement and to carry out its obligations hereunder and to
consummate the transactions contemplated hereby. All necessary corporate
proceedings of Alarmax have been duly taken to authorize the execution, delivery
and performance of this Agreement. This Agreement has been duly and validly
executed and delivered by Alarmax and constitutes the legal, valid and binding
agreement of Alarmax, enforceable against Alarmax in accordance with its terms.
No consent of any party to any contract, agreement, instrument, or understanding
to which Alarmax is a party, or by which any of its properties or assets is
bound, is required for the execution, delivery or performance by Alarmax of this
Agreement and to consummate the transactions contemplated hereby.

          (b) Neither the execution and delivery by Alarmax of this Agreement,
the performance of its obligations hereunder nor the consummation of the
transactions contemplated hereby will (i) conflict with its Certificate of
Incorporation or Bylaws or (ii) violate, result in the breach of or conflict
with any law, rule, regulation order, judgment or decree binding on it or which
any of its operations, business, properties or assets is subject or (iii) with
or without notice, the passage of time or both, constitute a breach or violation
of, be in conflict with or constitute or create a default under any material



                                       8




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CUSIP No. 36242E101              13D                         Page 18 of 26 Pages
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agreement  to which  Alarmax is a party or by which it or any of its  properties
are bound.

     12. CERTAIN DELIVERIES. On the date hereof:

          (a) Teitelbaum will deliver to the Companies (i) (x) the Warrant for
cancellation or a (y) duly executed Affidavit of Loss and Indemnity, and (ii)
duly executed transfers of title and such other documents as may be necessary to
transfer the BMW to the Companies;

          (b) Alarmax will pay GVI $145,000 by check of immediately available
funds to an account designated by GVI;

          (c) GVIS will (i) deliver to Teitelbaum an executed copy of
instructions to the transfer agent of GVIS directing the issuance to Teitelbaum
of a certificate for 650,000 shares of Common Stock (representing the Settlement
Shares) and (ii) pay to Teitelbaum by check the sum of $40,000 to reimburse
Teitelbaum for legal fees and expenses pursuant to Section 15(j); and

          (d) each party will deliver such other documents reasonably requested
of it to be delivered to effectuate the transactions contemplated by this
Agreement.

     13. GVIS STOCK SALE.

          (a) Upon completion by GVIS of the Private Placement raising Net
Proceeds (defined below) of $20 million or more, GVIS shall, subject to the
provisions set forth below, at such place and date designated below, use the Net
Proceeds from the Private Placement to purchase, and Teitelbaum shall sell, $10
million of Teitelbaum Initial Shares at the same price per share of Common Stock
(with no value allocated to any warrants which may be issued in the Private
Placement) sold by GVIS in the Private Placement. GVIS shall deliver notice (the
"PURCHASE NOTICE") to Teitelbaum upon its reasonable belief that it will have an
obligation to purchase the Teitelbaum Initial Shares in accordance with this
Section 13(a). The Purchase Notice shall set forth the amount of Teitelbaum
Initial Shares GVIS is obligated to purchase and the price per share. The
purchase price and the consideration to be paid by GVIS shall consist of cash
payable at closing in the amount of $5 million and a subordinated promissory
note (the "NOTE") in the principal amount of $5 million a copy of which is
attached hereto as Exhibit A; PROVIDED, HOWEVER, for each dollar of Net Proceeds
raised in the Private Placement in excess of $20 million and less than $25
million the cash portion of the purchase price shall be increased by $0.50 and
the principal amount of the Note shall be decreased by $0.50; PROVIDED, FURTHER,
for each dollar of Net Proceeds raised in the Private Placement of $25 million
or more and less than or equal to $27.5 million, the cash portion of the
purchase price shall be increased by $1.00 and the principal amount of the Note
shall be decreased by $1.00. Notwithstanding anything to the contrary in this
Agreement, in the event the price per share of the Common Stock in any Private
Placement is $1.75 or less, Teitelbaum shall not be obligated to sell the
Teitelbaum Initial Shares to GVIS in accordance with this Section 13(a);
FURTHER, in the event Teitelbaum decides not to sell his Teitelbaum Initial
Shares to GVIS in accordance with this sentence, GVIS shall no longer be
obligated to purchase the Teitelbaum Initial Shares in accordance with this
Section 13(a). "NET PROCEEDS" for purposes of this Agreement shall mean the
gross proceeds from the sale of securities in the Private Placement less the



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CUSIP No. 36242E101              13D                         Page 19 of 26 Pages
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cash  commission  compensation  payable to the placement  agent for such Private
Placement.

          (b) Upon the completion by GVIS of the Private Placement raising Net
Proceeds of less than $20 million, GVIS shall, subject to the provisions set
forth below, at such place and date designated below, use the Net Proceeds from
the Private Placement to purchase, and Teitelbaum shall sell, such number of
Teitelbaum Initial Shares as may be purchased with 50% of the Net Proceeds of
Private Placement at the same price per share of Common Stock (with no value
allocated to any warrants which may be issued in the Private Placement) sold by
GVIS in the Private Placement. The purchase price and the consideration to be
paid by GVIS shall consist of (x) cash payable at closing in the amount of 50%
of the aggregate purchase price of the Teitelbaum Initial Shares required to be
purchased under this Section 13(b) (25% of the Net Proceeds) and (y) a Note in
the principal amount of 50% of the aggregate purchase price of the Teitelbaum
Initial Shares required to be purchased under this Section 13(b) (25% of the Net
Proceeds). GVIS shall deliver a Purchase Notice to Teitelbaum upon its
reasonable belief that it will have an obligation to purchase the Teitelbaum
Initial Shares in accordance with this Section 13(b). The Purchase Notice shall
set forth the amount of Teitelbaum Initial Shares GVIS is obligated to purchase
and the price per share. Notwithstanding anything to the contrary in this
Agreement, in the event the price per share of the Common Stock in any Private
Placement is $1.75 or less, Teitelbaum shall not be obligated to sell the
Teitelbaum Initial Shares to GVIS in accordance with this Section 13(b);
further, in the event Teitelbaum decides not to sell his Teitelbaum Initial
Shares to GVIS in accordance with this sentence, GVIS shall no longer be
obligated to purchase the Teitelbaum Initial Shares in accordance with this
Section 13(b).

          (c) Teitelbaum acknowledges that the Unterberg Private Placement is
being sold on a "best efforts" basis and there is no certainty as to the amount
of the proceeds, if any, of the Unterberg Private Placement or from any other
Private Placement. In the event the Private Placement is not consummated, the
releases and covenants provided by Teitelbaum in this Agreement, except as
otherwise expressly provided herein, shall remain in full force and effect and
GVIS shall have no further obligation to purchase any Teitelbaum Initial Shares
hereunder.

          (d) In the event that Teitelbaum receives less than $650,000 as
consideration for the purchase of the Teitelbaum Initial Shares pursuant to this
Agreement by March 31, 2005 (the "PURCHASE DEADLINE"), GVIS, at the option of
Teitelbaum, shall purchase from Teitelbaum at such place and date designated
below, such number of additional Teitelbaum Initial Shares, or 650,000
Teitelbaum Initial Shares if no Teitelbaum Initial Shares have been purchased by
the Purchase Deadline, at a purchase price of $1.00 per share (subject to
adjustment for any stock split, recapitalization, combination or similar event
effecting the Common Stock of GVIS occurring after the date hereof) so that GVIS
has purchased an aggregate of $650,000 of Teitelbaum Initial Shares. Teitelbaum
shall deliver written notice to GVIS upon his election for GVIS to purchase such
shares no later than 3 business days after the Purchase Deadline. Any purchase
by GVIS in accordance with this Section 13(d) shall not count toward the 4%
limitation in the lock-up provisions in Section 6 of the Registration Rights
Agreement.

          (e) For purposes of this Agreement, the term "PRIVATE PLACEMENT" shall
mean the Unterberg Private Placement or one or more sales by GVIS of its Common
Stock or securities convertible into Common Stock consummated no later than
March 31, 2005 for the purpose of raising equity capital; PROVIDED, HOWEVER, the



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term Private Placement shall not include any issuance or sale of (i) securities
to Laurus Master Fund, Ltd ("LAURUS") or its affiliates in connection with
conversion of debt with respect to the financing completed on May 27, 2004 with
Laurus or additional sums borrowed from Laurus in accordance with the $5 million
Secured Revolving Note and the accounts receivable facility as set forth in that
certain Security Agreement by and between GVIS and Laurus dated May 27, 2004,
(ii) debt securities exclusive of any equity securities or securities
convertible into equity or (iii) securities in connection with any bridge
financing consummated prior to December 21, 2004 in anticipation of either the
(A) Unterberg Private Placement or (B) a Private Placement in which Oppenheimer
or its affiliates acts as placement agent.

          (f) The indebtedness of the Companies to Teitelbaum under the Note
shall be subordinated to the indebtedness of the Companies to Lauras in
accordance with a subordination agreement, reasonably satisfactory to the
Teitelbaum and the Companies to be entered into by the Companies, Teitelbaum and
Lauras (to the extent applicable) (the "SUBORDINATION AGREEMENT") at the Stock
Closing (as defined below) with respect to the Teitelbaum Initial Shares. The
Subordination Agreement is attached hereto as Exhibit B.

          (g) GVIS agrees that it will direct the placement agent in any Private
Placement to deposit in escrow with Kronish Lieb Weiner and Hellman, LLP, or a
bank of national standing reasonably satisfactory to Teitelbaum at the time of
closing of the Private Placement such cash amount from the Net Proceeds of the
Private Placement which are necessary to repurchase the Teitelbaum Initial
Shares in accordance with this Agreement.

          (h) The closing of the purchase of the Teitelbaum Initial Shares shall
be held at the offices of Kronish Lieb Weiner & Hellman LLP, 1114 Avenue of the
Americas, New York, New York 10036 or such other place as GVIS and Teitelbaum
shall agree no later than the next business day following a closing of the
Private Placement triggering the purchase of the Teitelbaum Initial Shares
pursuant to Sections 13(a) or 13(b) hereof. The Stock Closing with respect to
the purchase and sale of Teitelbaum Initial Shares as provided in Section 13(d)
hereof shall occur no later than five business days after the Purchase Deadline.
At each Stock Closing, Teitelbaum shall deliver to GVIS (i) a certificate or
other instrument executed by Teitelbaum containing representations to the effect
that (x) Teitelbaum owns all right title and interest in and to such shares as
may transferred at any such closing, free and clear of all liens, encumbrances,
security interests, mortgages, hypothecations, pledges, restrictions, option
agreements or arrangements, rights of first refusal, charges, claims or other
rights of any kind (collectively, "Liens") and (y) Teitelbaum has the
unrestricted right to sell, assign, transfer, convey and deliver to GVIS all
right, title and interest in and to the Teitelbaum Initial Shares, as may be
transferred at such closing without penalty or other adverse consequences, and
upon the Stock Closing, GVIS will own the Teitelbaum Initial Shares free and
clear of all Liens, (ii) such other documents as may be reasonably requested by
GVIS and (iii) duly executed stock powers and such other documents as may be
necessary to transfer the Teitelbaum Initial Shares being then sold to GVIS.
GVIS shall wire to an account designated by Teitelbaum payment of the purchase
price in immediately available funds. There may be more than one Stock Closing.
Each such closing described in this Section 13(h) shall be referred to as a
"STOCK CLOSING" hereunder.

     14. INDEMNIFICATION.



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CUSIP No. 36242E101              13D                         Page 21 of 26 Pages
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          (a) INDEMNIFICATION BY TEITELBAUM. Teitelbaum agrees to indemnify and
hold harmless the Companies, their officers and directors, employees, agents and
representatives and affiliates and each other person, if any, who controls any
thereof, against any loss, liability, claim, damage and expense whatsoever
(including, but not limited to, any and all expenses whatsoever reasonably
incurred in investigating, preparing or defending against any litigation
commenced or threatened or any claim whatsoever) arising out of or based upon
any untruth, inaccuracy, or breach of any of the representations, warranties,
covenants or agreements of Teitelbaum contained in this Agreement, the Note (to
the extent applicable), the Subordination Agreement (to the extent applicable)
or in any other document furnished by Teitelbaum to any of the foregoing in
connection with this transaction.

          (b) INDEMNIFICATION BY ALARMAX. Alarmax agrees to indemnify and hold
harmless the Companies, their officers and directors, employees, agents and
representatives and affiliates and each other person, if any, who controls any
thereof, against any loss, liability, claim, damage and expense whatsoever
(including, but not limited to, any and all expenses whatsoever reasonably
incurred in investigating, preparing or defending against any litigation
commenced or threatened or any claim whatsoever) arising out of or based upon
any untruth, inaccuracy, or breach of any of the representations, warranties,
covenants or agreements of Alarmax contained in this Agreement or in any other
document furnished by Alarmax to any of the foregoing in connection with this
transaction.

          (c) INDEMNIFICATION BY THE COMPANIES. The Companies agree to indemnify
and hold harmless Teitelbaum and Alarmax, its officers and directors, employees,
agents, representatives and affiliates and each other person, if any, who
controls any thereof, against any loss, liability, claim, damage and expense
whatsoever (including, but not limited to, any and all expenses whatsoever
reasonably incurred in investigating, preparing or defending against any
litigation commenced or threatened or any claim whatsoever) arising out of or
based upon any untruth, inaccuracy, or breach of any of the representations,
warranties, covenants or agreements of the Companies contained in this
Agreement, the Note (to the extent applicable), the Subordination Agreement (to
the extent applicable) or in any other document furnished by the Companies to
any of the foregoing in connection with this transaction.

          (d) NOTICES OF CLAIMS. Promptly after receipt by an indemnified party
of notice of the commencement of any action or proceeding involving a claim
referred to in Section 14(a), 14(b) or 14(c) such indemnified party will, if a
claim in respect thereof is to be made against an indemnifying party, give
written notice to the latter of the commencement of such action; PROVIDED,
HOWEVER, that the failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligations under this
Section 14, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is brought
against an indemnified party, the indemnifying party shall be entitled to
participate in and to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation; PROVIDED, HOWEVER, that if the indemnified party reasonably



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CUSIP No. 36242E101              13D                         Page 22 of 26 Pages
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believes it is advisable for it to be represented by separate counsel because
there exists a conflict of interest between its interests and those of the
indemnifying party with respect to such claim, or there exist defenses available
to such indemnified party which may not be available to the indemnifying party,
or if the indemnifying party shall fail to assume responsibility for such
defense, the indemnified party may retain counsel satisfactory to it and the
indemnifying party shall pay all fees and expenses of such counsel. No
indemnifying party shall be liable for any settlement of any action or
proceeding effected without its written consent, which consent shall not be
unreasonably withheld or delayed. No indemnifying party shall, without the
consent of the indemnified party, consent to entry of any judgment or enter into
any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect to such claim or litigation or which requires action
other than the payment of money by the indemnifying party. Each indemnified
party shall furnish such information regarding itself or the claim in question
as an indemnifying party may reasonably request in writing and as shall be
reasonably requested in connection with the defense of such claim and litigation
resulting therefrom.

     15. MISCELLANEOUS.

          (a) ENTIRE AGREEMENT; AMENDMENT. This Agreement supersedes all prior
oral and written agreements between the parties and their affiliates with
respect to the subject matter hereof. This Agreement and the other documents and
agreements between the parties and their affiliates which are referred to herein
or executed contemporaneously herewith set forth the entire agreement among the
parties with respect to the subject matter hereof and thereof. No agreement
shall be effective to change, modify, waive, release, amend, terminate,
discharge or effect an abandonment of this Agreement, in whole or in part,
unless such agreement is in writing, refers expressly to this Agreement and is
signed by the party against whom enforcement of the change, modification,
waiver, release, amendment, termination, discharge or effectuation of the
abandonment is sought.

          (b) SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties of the Companies, Teitelbaum and Alarmax contained in or made
pursuant to this Agreement, shall survive the execution and delivery of such
documents and the Closing for a period of 15 months and shall in no way be
affected by any investigation of the subject matter thereof made by or on behalf
of the Companies, Teitelbaum or Alarmax.

          (c) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which together shall constitute one and the same
agreement. This Agreement shall be binding on the parties hereto notwithstanding
that the parties are not all signatories to the same counterpart so long as each
party shall have executed and delivered a counterpart of this Agreement. The
transmission of a signed counterpart of this Agreement by telecopier shall
constitute sufficient delivery hereof.

          (d) GOVERNING LAW. This Agreement is made under and shall be governed
by and construed in accordance with the internal laws of the State of New York
without regard to the conflict of laws principles thereof; PROVIDED, HOWEVER,
this Agreement as between Alarmax and the Companies shall be governed by and


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CUSIP No. 36242E101              13D                         Page 23 of 26 Pages
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construed in accordance with the governing law provisions set forth in Section
13 of the Supply Agreement.

          (e) SUCCESSORS AND ASSIGNS; ASSIGNMENT. This Agreement and the
provisions hereof shall be binding upon, and inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors, heirs,
beneficiaries, personal representatives, executors, successors and permitted
assigns (and in the case of indemnities to benefits of all persons indemnified).
This Agreement and the rights and obligations hereunder shall not be assigned by
any party hereto without the prior written consent of the other parties hereto;
except that GVIS may assign this Agreement without the consent of any party
hereto in the case of a merger of GVIS in which GVIS is not the surviving
entity.

          (f) FURTHER ASSURANCES. Each party shall, at any time and from time to
time after the date hereof, do, execute, acknowledge and deliver, or cause to be
done, executed, acknowledged and delivered, all such further acts, deeds,
assignments, transfers, conveyances, powers of attorney, receipts,
acknowledgments, acceptances and assurances as may be reasonably required to
procure for any party, and his, her or its successors and assigns, the benefits
intended to be conferred upon such party under this Agreement.

          (g) SEVERABILITY. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by reason of any rule of law or
public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions or agreements of the parties contemplated hereby
are not affected in any manner materially adverse to any party; PROVIDED,
HOWEVER, that upon a finding by a court of competent jurisdiction that any of
the releases and covenants provided for in Sections 5 through 6 hereof are
illegal, void, or unenforceable, the Companies, Teitelbaum or Alarmax, as the
case may be, agrees to execute a release, waiver and/or covenant that is legal
and enforceable. Upon the determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner.

          (h) JURISDICTION, VENUE, SERVICE OF PROCESS. Any action or proceeding
with respect to this Agreement shall be brought exclusively in the courts of the
state of New York residing in the borough of Manhattan or of the United States
of America for the Southern District of New York, in the borough of Manhattan,
and, by execution and delivery of this Agreement, each party hereto hereby
accepts for itself and in respect of its property, generally and
unconditionally, the exclusive jurisdiction of the aforesaid courts; PROVIDED;
HOWEVER, any action or proceeding with respect to this Agreement or the matters
reserved by the Companies or Alarmax in Sections 5(b) or 6(b) shall be brought
in accordance with the jurisdiction procedures set forth in Section 13 of the
Supply Agreement. Each party hereto hereby waives, and agrees not to assert, as
a defense in any action, suit or proceeding for the interpretation or
enforcement of this Agreement or any related document, that it is not subject
thereto or that such action, suit or proceeding may not be brought or is not
maintainable in said courts or that this Agreement or any related document may
not be enforced in or by said courts or that its property is exempt or immune
from execution, that the suit, action or proceeding is brought in an
inconvenient forum, that the venue of the suit, action or proceeding is improper
or (provided that process shall be served in any manner referred to in the



                                       14




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CUSIP No. 36242E101              13D                         Page 24 of 26 Pages
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following sentence) that service of process upon such party is ineffective. Each
party hereto agrees that service of process in any such action, suit or
proceeding against it with respect to this Agreement may be made upon it in any
manner permitted by the laws of the state of New York or the federal laws of the
United States or as follows: (i) by personal service or by certified or
registered mail to the party's designated agent for such service in such state,
or (ii) by certified or registered mail to the party at its address provided for
in subsection (i) below. Service of process in any manner referred to in the
preceding sentence shall be deemed, in every respect, effective service of
process upon such party.

          (i) NOTICES. Any and all notices, requests, demands, consents and
other communications required or permitted under this Agreement shall be in
writing, signed by or on behalf of the party by which given, and shall be
considered to have been duly given when (i) delivered by hand, (ii) sent by
telecopier (with receipt confirmed), provided that a copy is mailed (on the same
date) by first class mail, postage prepaid, or (iii) delivered to the addressee,
if sent by Express Mail, Federal Express or other reputable express delivery
service (receipt requested), or by first class certified or registered mail,
return receipt requested, postage prepaid, in each case to the appropriate
addresses and telecopier numbers set forth as follows:


          If to any of the Companies:

                  GVI Security Solutions, Inc.
                  1621 West Crosby Road, Suite 104
                  Carrollton, Texas 75006
                  Fax: (972) 245-7333
                  Attn: Nazzareno Paciotti

          with a copy to:

                  Kronish Lieb Weiner & Hellman LLP
                  1114 Avenue of the Americas
                  New York, New York 10036
                  Fax: (212) 479-6275
                  Attn:  Alison Newman, Esq.

          If to Teitelbaum:

                  William Teitelbaum
                  4 Winston Court
                  Dix Hills, New York 11746

          with a copy to:


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CUSIP No. 36242E101              13D                         Page 25 of 26 Pages
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                  Olshan Grundman Frome Rosenzweig & Wolosky LLP
                  Park Avenue Tower
                  65 East 55th Street
                  New York, New York 10022
                  Fax: (212) 451-2222
                  Attn: James F. Gellman, Esq. and Sam Schwartz, Esq.

          If to Alarmax:

                  Alarmax Distributors, Inc.
                  Building 9, Suite 310
                  Foster Plaza
                  750 Holiday Drive
                  Pittsburgh, PA 15220
                  Fax:  (412) 921-4333
                  Attn:  Roger Graf

          with a copy to:

                  Reed Smith LLP
                  435 Sixth Avenue
                  Pittsburgh, PA 15219
                  Fax:  (412) 288-3063
                  Attn: Joseph F. Rodkey, Jr. Esq.

or to such other addresses and telecopier numbers as a party may from time to
time designate as to itself by notice similarly given to the other parties in
accordance herewith. A notice of change of address shall not be deemed given
until delivered to the addressee.

          (j) EXPENSES. Except as provided herein, each party will be liable for
its own costs and expenses incurred in connection with the negotiation,
preparation, execution or performance of this Agreement and with the
transactions contemplated hereby including, without limitation, all fees of
legal counsel, auditors and financial advisors; provided; however, the Companies
agree to reimburse Teitelbaum concurrently herewith for the actual, documented
and reasonable legal costs and expenses incurred by him in connection with the
negotiation, preparation, execution or performance of this Agreement (and all
prior negotiations with respect thereto, including, without limitation, the
settlement agreement contemplated by the parties hereto with respect to the Term
Sheet executed in May 2004) and with the transactions contemplated hereby, up to
$40,000, in accordance with invoices previously delivered by Teitelbaum.

          (k) HEADINGS. The headings of sections in this Agreement are for
reference only and shall not limit or control the meaning thereof.


                            [Signature Page Follows]


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CUSIP No. 36242E101              13D                         Page 26 of 26 Pages
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          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.


                                           GVI SECURITY SOLUTIONS, INC.


                                           By:  /s/ Nazzareno Paciotti
                                              ----------------------------------
                                           Name:  Nazzareno Paciotti
                                           Title: CEO



                                           GVI SECURITY, INC.


                                           By:  /s/ Nazzareno Paciotti
                                              ----------------------------------
                                           Name:  Nazzareno Paciotti
                                           Title:


                                           ALARMAX DISTRIBUTORS, INC.


                                           By:  /s/ Roger A. Graf
                                              ----------------------------------
                                           Name:  Roger A. Graf
                                           Title: President

                                                /s/ William A. Teitelbaum
                                           -------------------------------------
                                           William A. Teitelbaum


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