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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON NOVEMBER 20, 2000
REGISTRATION NO. 333-47670
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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NETSILICON, INC.
(Exact name of Registrant as specified in its charter)
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411 WAVERLEY OAKS, ROAD, BLDG. 227
WALTHAM, MASSACHUSETTS 02452
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MASSACHUSETTS (781) 647-1234 04-2826579
(State or other jurisdiction (Address, including zip code, and telephone number, (I.R.S. Employer
of incorporation or organization) including area code, of Registrant's principal executive offices) Identification Number)
</TABLE>
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CORNELIUS PETERSON, VIII
PRESIDENT AND CHIEF EXECUTIVE OFFICER
NETSILICON, INC.
411 WAVERLEY OAKS, ROAD, BLDG. 227
WALTHAM, MASSACHUSETTS 02452
(781) 647-1234
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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COPIES OF ALL COMMUNICATIONS, INCLUDING ALL COMMUNICATIONS SENT TO THE AGENT FOR
SERVICE, SHOULD BE SENT TO:
Edwin L. Miller, Jr., Esq.
Testa, Hurwitz & Thibeault, LLP
125 High Street
Boston, Massachusetts 02110
(617) 248-7000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.
[ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
check the following. [ ]
CALCULATION OF REGISTRATION FEE
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AMOUNT TO BE PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES REGISTERED OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION
TO BE REGISTERED SHARE(1) PRICE(1) FEE(2)
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Common Stock, $0.01 par value per share 90,000 $16.81 $1,512,900 $399.41(4)
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Preferred Stock purchase rights (3) 90,000 N/A N/A N/A
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(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933, as amended.
(2) Pursuant to Rule 457(c) under the Securities Act of 1933, the registration
fee has been calculated based upon the average of the high and low prices per
share of the common stock of NETsilicon, Inc. on the Nasdaq National Market on
October 5, 2000.
(3) Preferred Stock purchase rights will be distributed without charge with
respect to each share of common stock of the Registrant registered hereby.
(4) Previously paid.
NETSILICON, INC. HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL NETSILICON, INC.
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY
DETERMINE.
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NETSILICON, INC.
90,000 SHARES
COMMON STOCK
This prospectus is part of a registration statement that covers 90,000
shares of our common stock. The shares may be offered and sold from time to time
by one of our stockholders. We will not receive any of the proceeds from the
resale of the shares.
Our common stock is traded on the Nasdaq National Market under the symbol
"NSIL." The last reported sale price of our common stock on the Nasdaq National
Market on November 15, 2000 was $6.31 per share.
INVESTING IN THE COMMON STOCK INVOLVES RISKS.
SEE "RISK FACTORS" BEGINNING ON PAGE 2.
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 November __, 2000.
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SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere or incorporated by reference in this prospectus.
This prospectus may contain certain "forward-looking" information, as that term
is defined by (i) the Private Securities Litigation Reform Act of 1995 (the
"Act") and (ii) releases made by the Securities and Exchange Commission. Such
information involves risks and uncertainties. Our actual results may differ
materially from the results discussed in the forward-looking statements. Factors
that might cause such a difference include, but are not limited to, those
discussed in "Risk Factors."
THE COMPANY
We develop and market semiconductor devices and software designed to
meet the networking requirements of embedded systems. Customers incorporate our
products into the design of embedded systems to provide them with the ability to
communicate over standards-based local area networks, wide-area networks and the
Internet, enabling the development of new embedded systems applications. We
design our technology to have broad applicability and it therefore may add
network functionality to many embedded systems. Our products are currently
contained in a broad array of products, including digital office equipment and
factory automation and process control equipment.
RECENT DEVELOPMENTS
Each of the shares being registered was acquired in connection with our
acquisition of certain assets from PASW, Inc. on August 31, 2000. In connection
with the acquisition, we agreed to register the shares issued to PASW, Inc. in
this registration statement.
CONTACT INFORMATION
We incorporated in Massachusetts in April of 1984 under the name
Digital Products, Inc. In 1998, we changed our name to NETsilicon, Inc. Our
executive offices are located at 411 Waverley Oaks Road, Bldg. 227, Waltham,
Massachusetts 02452 (telephone: (781) 647-1234).
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RISK FACTORS
You should carefully consider the following risks before investing in
our common stock. These are not the only risks facing our company. Additional
risks may also impair our business operations. If any of the following risks
come to fruition, our business, results of operations or financial condition
could be materially adversely affected. In that case, the trading price of our
common stock could decline, and you may lose all or part of your investment. You
should also refer to the other information set forth in this prospectus, and
incorporated by reference, including our financial statements and the
accompanying notes.
WE HAVE A HISTORY OF LOSSES AND AN ACCUMULATED DEFICIT THAT MAKE FUTURE
OPERATING RESULTS AND PROFITABILITY DIFFICULT TO PREDICT.
We incurred net losses from continuing operations for the fiscal years
ended January 31, 1997, 1998 and 1999. At January 31, 2000, we had an
accumulated deficit of $2.4 million. Although we were profitable in fiscal year
2000 and for the first six months of fiscal year 2001, there can be no assurance
that we will be able to maintain profitability on a quarterly or annual basis in
the future. In addition, revenue growth is not necessarily indicative of future
operating results and there can be no assurance that we will be able to sustain
revenue growth. We continue to invest significant financial resources in product
development, marketing and sales, and a failure of such expenditures to result
in significant increases in revenue could have a material adverse effect on us.
Due to the limited history and undetermined market acceptance of our new
products, the rapidly evolving nature of our business and markets, potential
changes in product standards that significantly influence many of the markets
for our products, the high level of competition in the industries in which we
operate and the other factors described elsewhere in Risk Factors, there can be
no assurance that our investment in these areas will result in increases in
revenue or that any revenue growth that is achieved can be sustained. Our
history of losses, coupled with the factors described below, make future
operating results difficult to predict. We and our future prospects must be
considered in light of the risks, costs and difficulties frequently encountered
by emerging companies. As a result, there can be no assurance that we will be
profitable in any future period.
THE UNPREDICTABILITY OF OUR QUARTERLY RESULTS MAY ADVERSELY AFFECT THE TRADING
PRICE OF OUR COMMON STOCK.
Our net sales and operating results have in the past and may in the
future fluctuate substantially from quarter to quarter and from year to year.
These results have varied significantly due to a number of factors, including:
- market acceptance of and demand for our products and those of our
customers;
- unanticipated delays or problems in the introduction of our
products;
- the timing of large customer orders;
- the timing and success of our customers' development cycles;
- our ability to introduce new products in accordance with customer
design requirements and design cycles;
- new product announcements or product introductions by us and our
competitors;
- availability and cost of manufacturing sources for our products;
- the volume of orders that are received and can be filled in a
quarter;
- the rescheduling or cancellation of orders by customers;
- changes in product mix;
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- timing of "design wins" with our customers and related revenue;
and
- changes in currency exchange rates.
Our operating results could also be harmed by:
- the growth rate of markets into which we sell our products;
- changes in the mix of sales to customers and sales
representatives;
- costs associated with protecting our intellectual property; and
- changes in product costs and pricing by us and our competitors.
We budget expenses based in part on future revenue projections. We may
be unable to adjust spending in a timely manner in response to any unanticipated
declines in revenues.
As a result of these and other factors, investors should not rely
solely upon period-to-period comparisons of our operating results as an
indication of future performance. It is likely that in some future period our
operating results or business outlook will be below the expectations of
securities analysts or investors, which would likely result in a significant
reduction in the market price of the shares of common stock.
OUR FAILURE TO INCREASE SALES TO EMBEDDED SYSTEMS MANUFACTURERS WILL ADVERSELY
AFFECT OUR FINANCIAL RESULTS.
Our financial performance and future growth is dependent upon our
ability to sell our products to embedded systems developers in various markets,
including markets in which networking solutions for embedded systems have not
historically been sold, such as the industrial automation equipment, data
acquisition and test equipment, Internet devices and security equipment markets.
A substantial portion of our recent development efforts have been directed
toward the development of new products for markets that are new and rapidly
evolving. There can be no assurance that
- the additional embedded systems markets targeted by us for our
products and services will develop;
- developers within each market targeted by us will choose our
products and services to meet their needs;
- we will successfully develop products to meet the
industry-specific requirements of developers in our targeted
markets or that design wins will result in significant sales; or
- developers in our targeted markets will gain market acceptance for
their devices which incorporate our products.
We have limited experience in designing our products to meet the
requirements of developers in these industries. Moreover, our products and
services have, to date, achieved limited acceptance in these industries.
WE ARE DEPENDENT ON THE IMAGING MARKET FOR A LARGE PORTION OF OUR REVENUES.
The imaging market has historically accounted for substantially all of
our revenues. In the fiscal years ended January 31, 2000, 1999 and 1998, 95%,
95% and 100%, respectively, of our revenues were generated from customers in the
imaging market. Our success has been and continues to be dependent on the
continued growth and success of the imaging market. Many of our customers face
competition from
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larger, more established companies which may exert competitive or other
pressures on them. Any decline in sales to the imaging market would have a
material adverse effect on our business, results of operations and financial
condition.
The imaging market is characterized by declining prices of existing
products. Therefore, continual improvements in manufacturing efficiencies and
the introduction of new products and enhancements to existing products are
required for us to maintain our gross margins. In response to customer demands
or competitive pressures, or to pursue new product or market opportunities, we
may take certain pricing or marketing actions, such as price reductions or
volume discounts. These actions could have a material adverse effect on us.
A significant amount of our customers in the imaging market are
headquartered in Japan. Our customers are subject to declines in their local
economies, which have affected them from time to time in the past and may affect
them in the future. The success of our customers affects their purchases from
us.
OUR HIGHLY CONCENTRATED CUSTOMER BASE INCREASES THE POTENTIAL ADVERSE EFFECT ON
US FROM THE LOSS OF ONE OR MORE CUSTOMERS.
Our products have historically been sold into the imaging markets for
use in products such as printers, scanners, fax machines, copiers and
multi-function peripherals. This market is highly concentrated. Accordingly, our
sales are derived from a limited number of customers, with the top five OEM
customers accounting for 72% and 52% of total revenues for the fiscal years
ended 2000 and 1999, respectively. In particular, sales to Ricoh, Dimatech and
Minolta each accounted for 26%, 24% and 13% of total revenues, respectively, for
the fiscal year ended January 31, 2000. Sales to Minolta, Kyocera and Konica
accounted for 12%, 12% and 11% of total revenues, respectively, for the fiscal
year ended January 31, 1999. We expect that a small number of customers will
continue to account for a substantial portion of our total revenues for the
foreseeable future. All of our sales are made on the basis of purchase orders
rather than under long-term agreements, and therefore, any customer could cease
purchasing our products at any time without penalty. The decision of any key
customer to cease using our products or a material decline in the number of
units purchased by a significant customer would have a material adverse effect
on us.
THE LONG AND VARIABLE SALES CYCLE FOR OUR PRODUCTS MAKE IT MORE DIFFICULT FOR US
TO PREDICT OUR OPERATING RESULTS AND MANAGE OUR BUSINESS.
The sale of our products typically involves a significant technical
evaluation and commitment of capital and other resources by potential customers,
as well as delays frequently associated with customers' internal procedures to
deploy new technologies within their products and to test and accept new
technologies. For these and other reasons, the sales cycle associated with our
products is typically lengthy, lasting nine months or longer, and is subject to
a number of significant risks, including customers' internal acceptance reviews,
that are beyond our control. Because of the lengthy sales cycle and the large
size of customer orders, if orders forecasted for a specific customer for a
particular quarter are not realized in that quarter, our operating results for
that quarter could be materially adversely affected.
OUR RELATIVELY LOW LEVEL OF BACKLOG INCREASES THE POTENTIAL VARIABILITY OF OUR
QUARTERLY OPERATING RESULTS.
Our backlog at the beginning of each quarter typically is not
sufficient to achieve expected sales for the quarter. To achieve our sales
objectives, we are dependent upon obtaining orders during each
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quarter for shipment during that quarter. Furthermore, our agreements with our
customers typically permit them to change delivery schedules.
Non-imaging customers may cancel orders within specified time frames
(typically 30 days or more prior to the scheduled shipment date under our
policies) without significant penalty. Our customers have in the past built, and
may in the future build, significant inventory in order to facilitate more rapid
deployment of anticipated major products or for other reasons. Decisions by such
customers to reduce their inventory levels have led and could lead to reductions
in their purchases from us. These reductions, in turn, have caused and could
cause adverse fluctuations in our operating results.
OUR DEPENDENCE ON NEW PRODUCT DEVELOPMENT AND THE RAPID TECHNOLOGICAL CHANGE
THAT CHARACTERIZES OUR INDUSTRY MAKE US SUSCEPTIBLE TO LOSS OF MARKET SHARE
RESULTING FROM COMPETITORS' PRODUCT INTRODUCTIONS AND SIMILAR RISKS.
The semiconductor and networking industries are characterized by
rapidly changing technologies, evolving industry standards, frequent new product
introductions, short product life cycles and rapidly changing customer
requirements. The introduction of products embodying new technologies and the
emergence of new industry standards can render existing products obsolete and
unmarketable. Our future success will depend on our ability to enhance our
existing products, to introduce new products to meet changing customer
requirements and emerging technologies, and to demonstrate the performance
advantages and cost-effectiveness of our products over competing products. Any
failure by us to modify our products to support new local-area network, or LAN,
wide-area network, or WAN, and Internet technologies, or alternative
technologies, or any failure to achieve widespread customer acceptance of such
modified products could have a material adverse effect on us. In particular, we
have dedicated significant resources to developing products based on the Linux
operating system and on the Java programming language, and the failure of these
products to achieve widespread acceptance could have a material adverse effect
on us.
We have in the past and may in the future experience delays in
developing and marketing product enhancements or new products that respond to
technological change, evolving industry standards and changing customer
requirements. There can be no assurance that we will not experience difficulties
that could delay or prevent the successful development, introduction and
marketing of these products or product enhancements, or that our new products
and product enhancements will adequately meet the requirements of the
marketplace and achieve any significant or sustainable degree of market
acceptance in existing or additional markets. Failure by us, for technological
or other reasons, to develop and introduce new products and product enhancements
in a timely and cost-effective manner would have a material adverse effect on
us. In addition, the future introductions or announcements of products by us or
one of our competitors embodying new technologies or changes in industry
standards or customer requirements could render our then-existing products
obsolete or unmarketable. There can be no assurance that the introduction or
announcement of new product offerings by us or one or more of our competitors
will not cause customers to defer the purchase of existing Company products.
Such deferment of purchases could have a material adverse effect on us.
OUR FAILURE TO EFFECTIVELY MANAGE PRODUCT TRANSITIONS COULD HAVE A MATERIAL
ADVERSE EFFECT ON US.
From time to time, we or our competitors may announce new products,
capabilities or technologies that may replace or shorten the life cycles of our
existing products. Announcements of currently planned or other new products may
cause customers to defer or stop purchasing our products
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until new products become available. Furthermore, the introduction of new or
enhanced products requires us to manage the transition from older product
inventories and ensure that adequate supplies of new products can be delivered
to meet customer demand. Our failure to effectively manage transitions from
older products could have a material adverse effect on our business, results of
operations and financial condition.
OUR FAILURE TO COMPETE SUCCESSFULLY IN OUR HIGHLY COMPETITIVE MARKET COULD
RESULT IN REDUCED PRICES AND LOSS OF MARKET SHARE.
The markets in which we operate are intensely competitive and
characterized by rapidly changing technology, evolving industry standards,
declining average selling prices and frequent new product introductions. A
number of companies offer products that compete with one or more elements of our
products. We believe that the competitive factors affecting the market for our
products include product performance, price and quality, product functionality
and features, the availability of products for existing and future platforms,
the ease of integration with other hardware and software components of the
customer's products, and the quality of support services, product documentation
and training. The relative importance of each of these factors depends upon the
specific customer involved. There can be no assurance that we will be able to
compete successfully against current and future competitors, or that competitive
factors faced by us will not have a material adverse effect on us.
We primarily compete with the internal development departments of large
manufacturing companies that have developed their own networking solutions, as
well as established developers of embedded systems software and chips such as
Axis Communications, Echelon, Emulex, Hitachi, Integrated Systems, Intel, Milan
Technology, a division of Digi International, Motorola, Peerless Systems,
Samsung and Wind River. In addition, we are aware of certain companies which
have recently introduced products that address the markets targeted by us. We
have experienced and expect to continue to experience increased competition from
current and potential competitors, many of which have substantially greater
financial, technical, sales, marketing and other resources, as well as greater
name recognition and larger customer bases than ours. In particular, established
companies in the networking or semiconductor industries may seek to expand their
product offerings by designing and selling products using competitive technology
that could render our products obsolete or have a material adverse effect on our
sales. Increased competition may result in further price reductions, reduced
gross margins and loss of market share.
WE DEPEND ON THIRD-PARTY SOFTWARE THAT WE USE UNDER LICENSES THAT MAY EXPIRE.
We rely on certain software that we license from third parties,
including software that is integrated with internally developed software and
used in our products to perform key functions. Our material software license
agreements are with Integrated Systems, which terminates only if we default
under the agreement; with Novell, which is renewable annually at the option of
both parties, and with Peerless Systems, which expires in 2004 and is subject to
year-to-year renewals thereafter at the option of both parties. These
third-party software licenses may not continue to be available to us on
commercially reasonable terms, and the related software may not continue to be
appropriately supported, maintained or enhanced by the licensors. The loss of
licenses to use, or the inability of licensors to support, maintain, and enhance
any of such software, could result in increased costs, delays or reductions in
product shipments until equivalent software is developed or licensed, if at all,
and integrated.
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WE DEPEND ON MANUFACTURING, ASSEMBLING AND PRODUCT TESTING RELATIONSHIPS AND ON
LIMITED SOURCE SUPPLIERS, AND ANY DISRUPTIONS IN THESE RELATIONSHIPS MAY CAUSE
DAMAGE TO OUR CUSTOMER RELATIONSHIPS.
We do not have our own semiconductor fabrication assembly or testing
operations or contract manufacturing capabilities. Instead, we rely upon
independent contractors to manufacture our components, subassemblies, systems
and products. Currently, all of our semiconductor devices are being
manufactured, assembled and tested by Atmel Corporation in the United States,
and we expect that we will continue to rely upon Atmel to manufacture, assemble
and test a significant portion of our semiconductor devices in the future. We
recently experienced a delay in the introduction of one of our products due to a
problem with Atmel's design tools. While we are in the process of qualifying
other suppliers, any qualification and pre-production periods could be lengthy
and may cause delays in providing products to customers in the event that the
sole source supplier of the semiconductor devices fails to meet our
requirements. For example, Atmel uses its manufacturing facilities for its own
products as well as those it manufactures on a contract basis. There is no
assurance that Atmel will have adequate capacity to meet the needs of its
contract manufacturing customers. In addition, semiconductor manufacturers
generally experience periodic constraints on their manufacturing capacity.
We also rely upon limited-source suppliers for a number of other
components used in our products. There can be no assurance that these
independent contractors and suppliers will be able to meet our future
requirements for manufactured products, components and subassemblies in a timely
fashion. We generally purchase limited-source components under purchase orders
and have no guaranteed supply arrangements with these suppliers. In addition,
the availability of many of these components to us is dependent in part on our
ability to provide our suppliers with accurate forecasts of our future
requirements. Any extended interruption in the supply of any of the key
components currently obtained from limited sources would disrupt our operations
and have a material adverse effect on our business, results of operations and
financial condition.
Delays or lost sales have been and could be caused by other factors
beyond our control, including late deliveries by vendors of components, changes
in implementation priorities or slower than anticipated growth in the market for
networking solutions for embedded systems. Operating results in the past have
also been adversely affected by delays in receipt of significant purchase orders
from customers. In addition, we have experienced delays as a result of the need
to modify our products to comply with unique customer specifications. In
general, the timing and magnitude of our revenues are highly dependent upon our
achievement of design wins, the timing and success of our customers' development
cycles, and our customers' product sales. Any of these factors could have a
material adverse effect on our business, results of operations and financial
condition.
THE CYCLICALITY OF THE SEMICONDUCTOR INDUSTRY MAY RESULT IN SUBSTANTIAL
PERIOD-TO-PERIOD FLUCTUATIONS.
Our semiconductor devices provide networking capabilities for embedded
systems. The semiconductor industry is highly cyclical and subject to rapid
technological change and has been subject to significant economic downturns at
various times, characterized by diminished product demand, accelerated erosion
of average selling prices and production overcapacity. The semiconductor
industry also periodically experiences increased demand and production capacity
constraints. As a result, we may experience substantial period-to-period
fluctuations in future operating results due to general semiconductor industry
conditions, overall economic conditions or other factors.
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OUR ABILITY TO COMPETE COULD BE JEOPARDIZED IF WE ARE UNABLE TO PROTECT OUR
INTELLECTUAL PROPERTY RIGHTS.
Our ability to compete depends in part on our proprietary rights and
technology. We have no patents and rely primarily on a combination of copyright
and trademark laws, trade secrets, confidentiality procedures and contract
provisions to protect our proprietary rights.
We generally enter into confidentiality agreements with our employees,
and sometimes with our customers and potential customers and limit access to the
distribution of our software, hardware designs, documentation and other
proprietary information. There can be no assurance that the steps taken by us in
this regard will be adequate to prevent the misappropriation of our technology.
While we have filed one patent application and plan to file various additional
applications, such applications may be denied. Any patents, once issued, may be
circumvented by our competitors. Furthermore, there can be no assurance that
others will not develop technologies that are superior to ours. Despite our
efforts to protect our proprietary rights, unauthorized parties may attempt to
copy aspects of our products or to obtain and use information that we regard as
proprietary. In addition, the laws of some foreign countries do not protect our
proprietary rights as fully as do the laws of the United States. There can be no
assurance that our means of protecting our proprietary rights in the United
States or abroad will be adequate or that competing companies will not
independently develop similar technology. Our failure to adequately protect our
proprietary rights could have a material adverse effect on our business, results
of operations and financial condition.
We exclusively license the right to use the NET+ARM trademark from ARM
Limited according to a royalty-free agreement expiring in 2008. We depend on ARM
to enforce its rights to the trademark against third-party infringement. There
can be no assurance that ARM will promptly and adequately enforce these rights
which could have a material adverse effect on our business, results of
operations and financial condition.
WE COULD BECOME SUBJECT TO CLAIMS AND LITIGATION REGARDING INTELLECTUAL PROPERTY
RIGHTS, WHICH COULD SERIOUSLY HARM US AND REQUIRE US TO INCUR SIGNIFICANT COSTS.
The semiconductor industry is characterized by frequent litigation
regarding patent and other intellectual property rights. Although we have not
been notified that our products infringe any third-party intellectual property
rights, there can be no assurance that we will not receive such notification in
the future. Any litigation to determine the validity of third-party infringement
claims, whether or not determined in our favor or settled by us, would at a
minimum be costly and divert the efforts and attention of our management and
technical personnel from productive tasks, which could have a material adverse
effect on our business, results of operations and financial condition. There can
be no assurance that any infringement claims by third parties or any claims for
indemnification by customers or end users of our products resulting from
infringement claims will not be asserted in the future or that such assertions,
if proven to have merit, will not materially adversely affect our business,
results of operations or financial condition. In the event of an adverse ruling
in any such matter, we would be required to pay substantial damages, cease the
manufacture, use and sale of infringing products, discontinue the use of certain
processes or be required to obtain a license under the intellectual property
rights of the third party claiming infringement. There can be no assurance that
a license would be available on reasonable terms or at all. Any limitations on
our ability to market our products, or delays and costs associated with
redesigning our products or payments of license fees to third parties, or any
failure by us to develop or license a substitute technology on commercially
reasonable terms could have a material adverse effect on our business, results
of operations and financial condition.
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WE FACE RISKS ASSOCIATED WITH OUR INTERNATIONAL OPERATIONS AND EXPANSION THAT
COULD IMPAIR OUR ABILITY TO GROW OUR REVENUES ABROAD.
In the fiscal years ended January 31, 2000, 1999 and 1998,
international sales constituted approximately 50%, 51% and 30% of our net sales,
respectively, and approximately 77%, 46% and 31% of our domestic sales,
respectively, were to customers headquartered in Asia.
We believe that our future growth is dependent in part upon our ability
to increase sales in international markets, and particularly to manufacturers
located in Japan, which sell their products worldwide. These sales are subject
to a variety of risks, including fluctuations in currency exchange rates,
tariffs, import restrictions and other trade barriers, unexpected changes in
regulatory requirements, longer accounts receivable payment cycles and
potentially adverse tax consequences and export license requirements. In
addition, we are subject to the risks inherent in conducting business
internationally, including political and economic instability and unexpected
changes in diplomatic and trade relationships. In particular, the economies of
certain countries in the Asia-Pacific region are experiencing considerable
economic instability and downturns. Because our sales to date have been
denominated in United States dollars, increases in the value of the United
States dollar could increase the price in local currencies of our products in
non-US markets and make our products more expensive than competitors' products
denominated in local currencies. In addition, an integral part of our business
strategy is to form strategic alliances for the manufacture and distribution of
our products with third parties, including foreign corporations. There can be no
assurance that one or more of the factors described above will not have a
material adverse effect on our business, results of operations and financial
condition.
We intend to expand our presence in Europe to address new markets. One
change resulting from the formation of a European Economic and Monetary Union
("EMU") required EMU member states to irrevocably fix their respective
currencies to a new currency, the euro, as of January 1, 1999. During the next
three years, business in the EMU member states will be conducted in both the
existing national currency such as the French franc or the Deutsche mark, and
the euro. As a result, companies operating or conducting business in EMU member
states will need to ensure that their financial and other software systems are
capable of processing transactions and properly handling these currencies,
including the euro. There can be no assurance that the conversion to the euro
will not have a material adverse effect on our business, results of operations
and financial condition.
IF WE LOSE KEY PERSONNEL IT COULD PREVENT US FROM EXECUTING OUR BUSINESS
STRATEGY.
Our business and prospects depend to a significant degree upon the
continuing contributions of our executive officers and our key technical
personnel. We do not have employment contracts with any of our key personnel,
with the exception of our Vice President, Industrial Automation, Embedded
Markets Europe; Vice President, Finance, and Chief Financial Officer; and the
Chairman, Chief Executive Officer and President, and we do not maintain any
key-man life insurance policies. Competition for such personnel is intense, and
there can be no assurance that we will be successful in attracting and retaining
qualified personnel. Failure to attract and retain key personnel could result in
our failure to execute our business strategy and have a material adverse effect
on us.
9
<PAGE> 12
ANY FAILURE TO COMPLY WITH SIGNIFICANT REGULATIONS AND EVOLVING INDUSTRY
STANDARDS COULD DELAY INTRODUCTION OF OUR PRODUCTS, WHICH COULD HURT OUR
BUSINESS.
The market for our products is subject to a significant number of
communications regulations and industry standards, some of which are evolving as
new technologies are deployed. In the United States, our products must comply
with various regulations defined by the Federal Communications Commission and
standards established by Underwriters' Laboratories. Some of our products may
not comply with current industry standards, and this noncompliance must be
addressed in the design of those products. Standards for networking are still
evolving. As the standards evolve, we may be required to modify our products or
develop and support new versions of our products. The failure of our products to
comply or delays in compliance, with the various existing and evolving industry
standards could delay introduction of our products, which could have a material
adverse effect on our business, results of operations and financial condition.
ANY MATERIAL PRODUCT DEFECTS COULD RESULT IN LOSS OF MARKET SHARE, DELAY OF
MARKET ACCEPTANCE OR PRODUCT LIABILITY CLAIMS OR LOSSES.
Complex products such as those offered by us may contain undetected or
unresolved defects when first introduced or as new versions are released. The
occurrence of material errors in the future could, and the failure or inability
to correct such errors would, result in the loss of market share, the delay or
loss of market acceptance of our products, material warranty expense, diversion
of engineering and other resources from our product development efforts, the
loss of credibility with our customers or product recall. The use of our
products for applications in devices that interact directly with the general
public, where the failure of the embedded system could cause property damage or
personal injury, could expose us to significant product liability claims.
Although we have not experienced any product liability or economic loss claims
to date, the sale and support of our products may entail the risk of such
claims. Any of such occurrences could have a material adverse effect upon our
business, results of operations and financial condition.
IF WE DO NOT SUCCESSFULLY MANAGE OUR GROWTH, IT COULD HAVE A MATERIAL ADVERSE
EFFECT ON US.
We have limited internal infrastructure and any significant growth
would place a substantial strain on our financial and management personnel and
information systems and controls. Such growth would require us to implement new
and enhance existing financial and management information systems and controls
and add and train personnel to operate such systems effectively. Our intention
to continue to pursue our growth strategy through efforts to increase sales of
existing products and new products can be expected to place even greater
pressure on our existing personnel and compound the need for increased
personnel, expanded information systems, and additional financial and
administrative control procedures. There can be no assurance that we will be
able to successfully manage expanding operations. Our inability to manage our
expanded operations effectively could have a material adverse effect on our
business, results of operations and financial condition.
A SUBSTANTIAL NUMBER OF SHARES OF OUR COMMON STOCK COULD BE SOLD INTO THE PUBLIC
MARKET, WHICH COULD DEPRESS OUR STOCK PRICE.
Sales of a substantial number of shares of common stock in the public
market could adversely affect the market price for our common stock and reported
earnings per share and could make it more difficult for us to raise funds
through equity offerings in the future.
10
<PAGE> 13
Subject to applicable federal and securities laws and the restrictions
set forth below, Osicom Technologies, Inc. ("Osicom") may sell any and all of
the shares of common stock beneficially owned by it or distribute any or all
such shares of common stock to its stockholders. Sales or distributions by
Osicom of substantial amounts of common stock in the public market or to its
stockholders, or the perception that such sales or distribution could occur,
could adversely affect the prevailing market prices for the common stock. Osicom
is not subject to any obligation to retain its shares in NETsilicon. As a
result, there can be no assurance concerning the period of time during which
Osicom will maintain its beneficial ownership of our common stock. Moreover,
there can be no assurance that, in any transfer by Osicom of a controlling
interest in us, any holders of common stock will be able to participate in such
transaction or will realize any premium with respect to their shares of common
stock.
ANY ACQUISITIONS WE HAVE MADE OR WILL MAKE COULD DISRUPT OUR BUSINESS AND
SERIOUSLY HARM OUR FINANCIAL CONDITION.
We continue to intend to consider investments in complementary
companies, products or technologies. We may buy businesses, products or
technologies in the future. In the event of any future purchases, we could:
- issue stock that would dilute our current stockholders' percentage
ownership;
- incur debt;
- assume liabilities;
- incur amortization expenses related to goodwill and other
intangible assets; or
- incur large and immediate write-offs.
OUR OPERATION OF ANY ACQUIRED BUSINESS WILL ALSO INVOLVE NUMEROUS RISKS,
INCLUDING:
- problems combining the purchased operations, technologies or
products;
- unanticipated costs;
- diversion of management's attention from our core business;
- adverse effects on existing business relationships with suppliers
and customers;
- risks associated with entering markets in which we have no or
limited prior experience; and
- potential loss of key employees, particularly those of the
purchased organizations.
We cannot assure you that we will be able to successfully integrate any
businesses, products, technologies or personnel that we have acquired or that we
might acquire in the future and any failure to do so could disrupt our business
and seriously harm our financial condition.
BECAUSE THE NASDAQ NATIONAL MARKET IS LIKELY TO EXPERIENCE EXTREME PRICE AND
VOLUME FLUCTUATIONS, THE PRICE OF OUR COMMON STOCK MAY DECLINE.
The market price of our shares is likely to be highly volatile and
could be subject to wide fluctuations in response to numerous factors, including
the following:
- actual or anticipated variations in our quarterly operating
results or those of our competitors;
- announcements by us or our competitors of new products or
technological innovations;
- introduction and adoption of new industry standards;
11
<PAGE> 14
- changes in financial estimates or recommendations by securities
analysts;
- changes in the market valuations of our competitors;
- announcements by us or our competitors of significant acquisitions
or partnerships; and
- sales of our common stock.
Many of these factors are beyond our control and may negatively impact
the market price of our common stock, regardless of our performance. In
addition, the stock market in general, and the market for technology companies
in particular, has been highly volatile. Our common stock may not trade at the
same levels of shares as that of other technology companies and shares of
technology companies, in general, may not sustain their current market prices.
In the past, securities class action litigation has often been brought against a
company following periods of volatility in the market price of its securities.
We may be the target of similar litigation in the future. Securities litigation
could result in substantial costs and divert management's attention and
resources, which could seriously harm our business and operating results.
PROVISIONS OF OUR CHARTER DOCUMENTS MAY HAVE ANTI-TAKEOVER EFFECTS THAT COULD
PREVENT A CHANGE OF CONTROL.
Provisions of our amended and restated certificate of incorporation and
bylaws could make it more difficult for a third party to acquire us, even if
doing so would be beneficial to our stockholders.
USE OF PROCEEDS
We will not receive any proceeds from the resale by the selling
stockholder of the shares being registered. The principal purpose of this
offering is to effect an orderly disposition of the selling stockholder's
shares. See "Selling Stockholder" and "Plan of Distribution" described below.
SELLING STOCKHOLDER
The following table sets forth, as of September 8, 2000, the number and
percentage of shares of our common stock beneficially owned by the selling
stockholder prior to this offering and the maximum number of shares that the
selling stockholder, its transferees, distributees, pledgees, donees or other
successors in interest, may offer and sell pursuant to this prospectus. We have
assumed, when calculating the numbers in the table, that all of the shares owned
by the selling stockholder and offered pursuant to this prospectus will be sold.
As of September 8, 2000, there were outstanding 6,232,375 shares of Voting
Common Stock and 7,500,000 shares of Non-Voting Common Stock. An asterisk in the
table below means that the number is less than 1%.
<TABLE>
<CAPTION>
SHARES OWNED BEFORE THE SHARES OFFERED PURSUANT TO SHARES OWNED AFTER
OFFERING THIS PROSPECTUS THE OFFERING
----------------------- -------------------------- ------------------
SELLING STOCKHOLDER NUMBER PERCENT NUMBER PERCENT NUMBER PERCENT
------------------- ------ ------- ------ ------- ------ -------
<S> <C> <C> <C> <C> <C> <C>
PASW, Inc. 90,000 * 90,000 * 0 *
----------------------------------------------------------------------------
Total: 90,000 * 90,000 * 0 *
</TABLE>
12
<PAGE> 15
The shares offered hereby were issued to the selling stockholder in
connection with our acquisition of certain assets of PASW, Inc. The transaction
occurred on August 31, 2000. Prior to the acquisition, the selling stockholder
had no material relationship with us or any of our affiliates within the past
three years.
General
In recognition of the fact that the selling stockholder may desire the
ability to sell shares of our common stock when it considers it appropriate, we
agreed to file a registration statement to permit the public sale of the shares
and to use our reasonable efforts to keep the registration statement effective
until the earlier of such time as all shares to be registered hereunder are
sold, and August 31, 2001. We will prepare and file such amendments and
supplements to the registration statement as may be necessary to keep it
effective during such period.
We have agreed to bear all expenses in connection with the registration
and resale of the shares (other than underwriting discounts and selling
commissions and the fees and expenses of counsel and other advisors to the
selling stockholders). See "Plan of Distribution." The asset purchase agreement
provides that we will indemnify the selling stockholder for any losses incurred
by it in connection with actions arising from any untrue statement of a material
fact in the registration statement or any omission of a material fact required
to be stated therein, unless such statement or omission was made in reliance
upon written information furnished to us by the selling stockholder. Similarly,
the asset purchase agreement provides that the selling stockholder will
indemnify us and our officers and directors for any losses incurred by it in
connection with any action arising from any untrue statement of material fact in
the registration statement or any omission of a material fact required to be
stated therein, if such statement or omission was made in reliance on written
information furnished to us by the selling stockholder.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Securities Act") may be permitted to directors, officers or
persons controlling the registrant pursuant to the foregoing provisions, we have
been informed 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.
PLAN OF DISTRIBUTION
The shares offered in this prospectus may be sold from time to time by
the selling stockholder for its own account. We are responsible for the expenses
incurred in the registration of the shares, other than selling discounts and
commissions and stock transfer fees and taxes applicable to the sale of the
shares. In addition, we have agreed to indemnify the selling stockholder against
certain liabilities, including liabilities under the Securities Act, and the
selling stockholder has agreed to indemnify us against certain liabilities,
including liabilities under the Securities Act.
The selling stockholder is not subject to any underwriting agreement.
The selling stockholder, or any parties who receive the shares from the selling
stockholder by way of a gift, donation or other transfer, may sell the shares
covered by this prospectus. The selling stockholder may sell the shares offered
by this prospectus from time to time at market prices prevailing at the time of
sale, at prices relating to the prevailing market prices or at negotiated
prices. The sales may be made in the over-the-counter market, on the Nasdaq
National Market, or on any exchange on which the shares are listed. The shares
may be sold by one or more of the following means:
13
<PAGE> 16
- one or more block trades in which a broker or dealer will attempt
to sell all or a portion of the shares held by the selling
stockholder as agent or principal;
- purchases by a broker or dealer as principal and resale by such
broker or dealer for its account pursuant to this prospectus;
- ordinary brokerage transactions and transactions in which a broker
solicits purchasers;
- in negotiated transactions; and
- through other means.
The selling stockholder may effect sales by selling shares to or
through broker-dealers, and such broker-dealers may receive compensation in the
form of underwriting discounts, concessions, commissions, or fees from the
selling stockholder and/or purchasers of the shares. Under the federal
securities laws, any broker-dealers that participate with the selling
stockholder in the distribution of the shares may be deemed to be underwriters
and any commissions received by them and any profit on the resale of the shares
positioned by them might be deemed to be underwriting compensation.
We have informed the selling stockholder that the antimanipulation
rules under Section 16 of the Securities Exchange Act may apply to sales in the
market and will furnish the selling stockholder with a copy of these rules if
the stockholder requests them. We have also informed the selling stockholder
that it needs to deliver a copy of this prospectus to the buyer when it sells
shares.
Some of the shares may be sold under Rule 144 rather than in reliance
on this prospectus.
We agreed to file a registration statement to register the resale of
the shares and to use our reasonable efforts to maintain the effectiveness of
the registration statement until the earlier of the date on which no shares
originally held by the selling stockholder remain unsold, and August 31, 2001.
American Stock Transfer and Trust Company, 40 Wall Street, New York,
New York, 10005, is the transfer agent for our common stock.
WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement on Form S-3 with the Securities
and Exchange Commission in connection with this offering. In addition, we file
annual, quarterly and current reports, proxy statements and other information
with the Securities and Exchange Commission. You may read and copy the
registration statement and any other documents we file at the Securities and
Exchange Commission's Public Reference Room at 450 Fifth Street, N.W.,
Washington, DC 20549. Please call the Securities and Exchange Commission at
1-800-SEC-0330 for further information on the Public Reference Room. Our
Securities and Exchange Commission filings are also available to the public at
the Securities and Exchange Commission's Internet site at http://www.sec.gov.
The Securities and Exchange Commission 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 part of this
prospectus, and information that we file later with the Securities and Exchange
Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filing we
will make with the Securities and Exchange Commission under Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act (File No. 000-26761):
1. Our Annual Report on Form 10-K for the fiscal year ended January
31, 2000;
14
<PAGE> 17
2. Our proxy statement, filed on May 24, 2000, for the annual meeting
of shareholders for the fiscal year ended January 31, 2000;
3. Our Quarterly Report on Form 10-Q for the fiscal quarter ended
April 29, 2000;
4. Our Quarterly Report on Form 10-Q for the fiscal quarter ended
July 29, 2000;
5. Our Current Report on Form 8-K filed on September 13, 2000;
6. Our Current Report on Form 8-K filed on September 15, 2000;
7. Our Amended Current Report on Form 8-K/A filed on November 14,
2000; and
8. The section entitled "Description of Registrant's Securities to be
Registered" contained in our Registration Statements on Form 8-A
filed on July 20, 1999 and September 13, 2000, including any
amendment or report filed for the purpose of updating that
description.
We will provide a copy of any and all of the information that is
incorporated by reference in this prospectus, not including exhibits to the
information unless those exhibits are specifically incorporated by reference
into this prospectus, to any person, without charge, upon written or oral
request.
Requests for copies of this information should be directed to Investor
Relations, NETsilicon, Inc., 411 Waverley Oaks Road, Bldg. 227, Waltham,
Massachusetts 02452; telephone number (781) 647-1234.
This prospectus is part of a registration statement we filed with the
Securities and Exchange Commission. You should rely only on the information or
representations provided in this prospectus. We have authorized no one to
provide you with different information. We are not making an offer of these
securities in any state where the offer is not permitted. You should not assume
that the information in this prospectus is accurate as of any date other than
the date on the front of the document.
15
<PAGE> 18
LEGAL MATTERS
Certain legal matters with respect to the issuance of the shares of
common stock offered hereby will be passed upon for NETsilicon by Testa, Hurwitz
& Thibeault, LLP, Boston, Massachusetts.
EXPERTS
The financial statements included in our annual report on Form 10-K for
the fiscal year ended January 31, 2000 incorporated by reference in this
prospectus have been audited by BDO Seidman, LLP, independent certified public
accountants, to the extent and for the periods set forth in their report
incorporated by reference herein, and are incorporated herein in reliance upon
such report, given upon the authority of said firm as an expert in accounting
and auditing.
16
<PAGE> 19
================================================================================
You should rely only on the information contained in this prospectus. We have
not authorized anyone to provide you with information different from that
contained in this prospectus. The selling security holders are offering to sell,
and seeking offers to buy, shares of Common Stock only in jurisdictions where
offers and sales are permitted. The information contained in this prospectus is
accurate only as of the date of this prospectus, regardless of the time of
delivery of this prospectus or of any sale of the Common Stock. In this
prospectus, references to "NETsilicon," "we," "our" and "us" refer to
NETsilicon, Inc.
--------------------
TABLE OF CONTENTS
Page
----
Summary..................................... 1
Risk Factors ............................... 2
Use of Proceeds ............................ 12
Selling Stockholder......................... 12
Plan of Distribution ....................... 13
Where You Can Find More Information......... 14
Incorporation of Certain Information
by Reference.............................. 14
Legal Matters .............................. 16
Experts .................................... 16
================================================================================
90,000 SHARES
[GRAPHIC OMITTED "Net"] [GRAPHIC OMITTED "SILICON"]
NETSILICON, INC.
90,000 SHARES
COMMON STOCK
---------------
PROSPECTUS
---------------
November __, 2000
================================================================================
<PAGE> 20
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth an estimate of the expenses expected to
be incurred in connection with the issuance and distribution of the securities
being registered, other than underwriting compensation:
Registration fee -- Securities and Exchange Commission... $ 399.41
Nasdaq National Market additional listing fee............ $ 2,000.00
Accounting fees and expenses............................. $ 6,500.00
Legal fees and expenses.................................. $18,000.00
Miscellaneous............................................ $ 1,000.00
TOTAL............................................... $27,899.41
NETsilicon will bear all expenses shown above. All amounts, other than
the Securities and Exchange Commission registration fee and the Nasdaq National
Market additional listing fee are estimates solely for the purpose of this
offering.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Massachusetts Business Corporation Law provides for indemnification
of the Company's directors and officers for liabilities and expenses that they
may incur in such capacities, except with respect to any matter that the
indemnified person shall have been adjudicated in any proceeding not to have
acted in good faith in the reasonable belief that his or her action was in the
best interest of the Company. Reference is made to the Company's corporate
charter and by-laws filed as Exhibits 3.1 and 3.2 hereto, respectively.
ITEM 16. EXHIBITS.
The following exhibits, required by Item 601 of Regulation S-K, are
filed as a part of this registration statement. Exhibit numbers, where
applicable, in the left column correspond to those of Item 601 of Regulation
S-K.
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------- ----------------------
3.1 Restated Articles of Organization, as amended (filed as Exhibit
3.1 to our Registration Statement on Form S-1 (File No. 333-62231)
and incorporated herein by reference)
3.2 Amended and Restated By-Laws of the Registrant (filed as Exhibit
3.2 to our Quarterly Report on Form 10-Q (File No. 0-26761) and
incorporated herein by reference)
4.1 Asset Purchase Agreement, dated as of August 31, 2000, between
NETsilicon, Inc., PASW, Inc. and PSI Softworks Technology, Inc.
(filed as Exhibit 2.1 to our Current Report on Form 8-K dated
September 15, 2000)
II-1
<PAGE> 21
4.2 Specimen Certificate for shares of the Registrant's Common Stock
(filed as Exhibit 4 to our Registration Statement on Form S-1
(File No. 333-62231) and incorporated herein by reference)
5.1* Opinion of Testa, Hurwitz & Thibeault, LLP
23.1* Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit
5.1)
23.2 Consent of BDO Seidman, LLP
24.1* Power of Attorney (included as part of the signature page of this
Registration Statement)
* Previously filed.
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereto.
(b) Insofar as indemnification for liabilities under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has 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. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(c) The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus filed as a
part of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) to file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement;
(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
II-2
<PAGE> 22
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that
which was registered ) and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20
percent change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
(3) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereto.
(4) To remove from registration by means of post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
II-3
<PAGE> 23
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Amendment
No. 1 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Waltham in the State of
Massachusetts, on this 20th day of November, 2000.
NETsilicon, Inc.
By: /s/ Daniel J. Sullivan
-------------------------------------
Daniel J. Sullivan
Chief Financial Officer
(Principal Financial and
Accounting Officer)
Pursuant to the requirements of the Securities Act of 1933, this
Amendment No. 1 to the Registration Statement has been signed by the following
persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ * President, Chief Executive Officer and November 20, 2000
------------------------------- Director (Principal Executive Officer)
Cornelius Peterson, VIII
/s/ Daniel J. Sullivan Chief Financial Officer November 20, 2000
------------------------------- (Principal Financial and Accounting Officer)
Daniel J. Sullivan
/s/ * Director November 20, 2000
-------------------------------
Michael K. Ballard
/s/ * Director November 20, 2000
-------------------------------
Francis E. Girard
/s/ * Director November 20, 2000
-------------------------------
William Johnson
/s/ * Director November 20, 2000
-------------------------------
Edward B. Roberts
/s/ * Director November 20, 2000
-------------------------------
F. Grant Saviers
* By: /s/ Daniel J. Sullivan
--------------------------
Daniel J. Sullivan
Attorney-In-Fact
</TABLE>
II-4
<PAGE> 24
INDEX TO EXHIBITS
EXHIBIT NO. DESCRIPTION OF EXHIBIT
----------- ----------------------
3.1 Restated Articles of Organization, as amended (filed as Exhibit
3.1 to our Registration Statement on Form S-1 (File No.
333-62231) and incorporated herein by reference)
3.2 Amended and Restated By-Laws of the Registrant (filed as Exhibit
3.2 to our Quarterly Report on Form 10-Q (File No. 333-62231) and
incorporated herein by reference)
4.1 Asset Purchase Agreement, dated as of August 31, 2000, between
NETsilicon, Inc., PASW, Inc. and PSI Softworks Technology, Inc.
(filed as Exhibit 2.1 to our Current Report on Form 8-K dated
September 15, 2000)
4.2 Specimen Certificate for shares of the Registrant's Common Stock
(filed as Exhibit 4 to our Registration Statement on Form S-1
(File No. 333-62231) and incorporated herein by reference)
5.1* Opinion of Testa, Hurwitz & Thibeault, LLP
23.1* Consent of Testa, Hurwitz & Thibeault, LLP (included in Exhibit
5.1)
23.2 Consent of BDO Seidman, LLP
24.1* Power of Attorney (included as part of the signature page of this
Registration Statement)
* Previously filed.
II-5
