<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 2, 1999
REGISTRATION NO. 333-81109
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------
AMENDMENT NO. 4
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
NETRIX CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 54-1345159
(State or other Jurisdiction of (I.R.S. Employer Identification Number)
Incorporation or Organization)
13595 DULLES TECHNOLOGY DRIVE
HERNDON, VIRGINIA 22071
(703) 742-6000
(Address and Telephone Number of Principal Executive Offices)
LYNN C. CHAPMAN
PRESIDENT
13595 DULLES TECHNOLOGY DRIVE
HERNDON, VIRGINIA 22071
(703) 742-6000
(Name, Address and Telephone Number of Agent for Service)
WITH A COPY TO:
JAY R. SCHIFFERLI, ESQ.
KELLEY DRYE & WARREN LLP
TWO STAMFORD PLAZA
281 TRESSER BOULEVARD
STAMFORD, CONNECTICUT 06901
(203) 324-1400
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, please 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, please 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 this form is a post-effective amendment filed pursuant to Rule 462(d) 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,
please check the following box. |_|
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT 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 THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
The information in this prospectus is not complete and may be changed.
We may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
<PAGE>
SUBJECT TO COMPLETION, DATED DECEMBER 2, 1999
PRELIMINARY PROSPECTUS
NETRIX CORPORATION
This prospectus relates to 1,413,660 shares of common stock of Netrix
Corporation that may be offered for sale by the security holders identified on
page 10 of this prospectus under the caption "Selling Security Holders." We will
not receive any proceeds from the sale of the common stock by the
securityholders.
Netrix Corporation's common stock is currently traded on the Nasdaq
National Market under the trading symbol "NTRX." On November 29, 1999, the last
sale price of the common stock on that market was $9.38 per share.
______________
INVESTING IN THESE SECURITIES INVOLVES A HIGH DEGREE OF RISK. 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 and complete. Any representation to the contrary is a
criminal offense.
______________
THE DATE OF THIS PROSPECTUS IS DECEMBER __, 1999.
<PAGE>
YOU SHOULD RELY ONLY UPON THE INFORMATION IN THIS PROSPECTUS. WE HAVE
NOT, AND THE SELLING SECURITY HOLDERS HAVE NOT, AUTHORIZED ANY OTHER PERSON TO
PROVIDE YOU WITH DIFFERENT INFORMATION. IF ANYONE PROVIDES YOU WITH DIFFERENT OR
INCONSISTENT INFORMATION, YOU SHOULD NOT RELY ON IT. WE ARE NOT, AND THE SELLING
SECURITY HOLDERS ARE NOT, MAKING AN OFFER TO SELL THESE SECURITIES IN ANY
JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. YOU SHOULD ASSUME THAT
THE INFORMATION APPEARING IN THIS PROSPECTUS IS ACCURATE AS OF THE DATE ON THE
FRONT COVER OF THIS PROSPECTUS ONLY. OUR BUSINESS, FINANCIAL CONDITION, RESULTS
OF OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE THAT DATE.
NETRIX CORPORATION
Netrix Corporation is a worldwide provider of voice and data networking
products. Our products are designed to deliver multi-service networks for the
transport of voice and data that enable our customers to provide a wide variety
of voice and data services. We combine patented, switched, compressed voice
technology and advanced networking capabilities to provide networking solutions
that improve network performance and deliver an array of tarrifable network
services.
Netrix was incorporated in Virginia in October 1985, and reincorporated
in Delaware in March 1987. Our principal executive offices are located at 13595
Dulles Technology Drive, Herndon, Virginia 20717, and our telephone number is
(703) 742-6000.
On September 30, 1999 we entered into an agreement to merge with
OpenROUTE Networks, Inc. In the merger we will issue one share of our common
stock for each share of outstanding OpenROUTE common stock, and we will be the
surviving company. An overview of the merger is provided below under the caption
"Proposed Merger with OpenROUTE Networks, Inc."
RISK FACTORS
This offering involves a high degree of risk. Before investing in these
securities, you should consider carefully the following risk factors, in
addition to the other information contained in this prospectus. Our business and
results of operations could be seriously harmed by any of the following risks.
The trading price of our common stock could decline due to any of these risks,
and you could lose part or all of your investment.
THE STAFF OF THE SECURITIES AND EXCHANGE COMMISSION HAS INDICATED THAT
IT BELIEVES ONE OF THE FINDERS IN OUR RECENT PRIVATE PLACEMENT MAY HAVE ACTED AS
AN UNREGISTERED BROKER-DEALER IN VIOLATION OF THE SECURITIES EXCHANGE ACT OF
1934 AND THIS COULD SUBJECT US TO A REPURCHASE OBLIGATION THAT COULD HAVE AN
ADVERSE EFFECT ON OUR FINANCIAL POSITION
The staff of the SEC has advised us that it believes Renwick Corporate
Finance and/or its affiliate, Renwick Securities, Inc., may have acted as an
unregistered broker-dealer in violation of the Securities Exchange Act in
connection with introducing certain investors to us in our private offering of
8% Series A convertible preferred stock. Renwick has advised us it does not
agree with the staff's position. If Renwick acted as an unregistered
broker-dealer in violation of the Securities Exchange Act, then under Section 29
of the Securities Exchange Act (1) our obligation to pay a finders fee to
Renwick would be voidable by us and (2) each investor introduced to us by
Renwick, and any subsequent holder of those shares, would have the right to
rescind their purchase of Series A 8% convertible preferred stock. We are
conducting a rescission offer to the nine investors introduced to us by Renwick,
in which we are offering to repurchase their Series A 8% convertible preferred
stock at the original total issue price of $1.76 million less dividends paid to
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date. Given the current price of our common stock relative to the conversion
price of the Series A 8% convertible preferred stock, we do not believe holders
of Series A convertible preferred stock will exercise their rescission right,
although there can be no assurance that this will be the result. Kelley Drye &
Warren LLP, our legal counsel, has advised us that this rescission offer should
preclude these investors and any future holders of these securities from seeking
rescission in the future based on a claim that Renwick acted as an unregistered
broker-dealer. However, Kelley Drye has also advised us that the law is not
settled on this point and there can be no assurance that the rescission offer,
in fact, will have this effect. If all of the investors exercised their
rescission right in our rescission offer or if holders of the securities are
successfully able to seek to rescind the investments in the future, our
financial position could be adversely affected.
WE INCURRED NET LOSSES IN EACH OF THE LAST TWO YEARS AND THERE IS NO
CONTROLLING LAW ON THIS ISSUE AND WE CANNOT BE CERTAIN THAT WE WILL GENERATE
SUFFICIENT REVENUES TO AGAIN BECOME PROFITABLE
For the years ended December 31, 1998 and 1997, respectively, we
incurred net losses of approximately $6.3 million and $8.6 million. Through
September 1999, we have incurred additional losses attributable to common stock
of approximately $5.8 million. If we cannot return to sustained profitability we
will be forced to sell all or part of our business, liquidate or seek to
reorganize. We will continue to incur significant sales and marketing, product
development and general and administrative expenses and, as a result, we will
need to generate higher revenues to achieve and sustain profitability on an
annual basis. We expect to increase our revenues through our new line of network
exchange products; however, to date, sales of network exchange products have not
been sufficient to replace the decline in our mature product sales. Although
revenues from network exchange products have grown in recent quarters, we cannot
be certain that we will continue to achieve revenue growth or realize sufficient
revenues to achieve profitability.
WE MAY REQUIRE ADDITIONAL CAPITAL TO FULLY IMPLEMENT OUR PLAN TO RETURN
TO PROFITABILITY, AND WE CANNOT BE CERTAIN THAT THE NECESSARY FUNDS WILL BE
AVAILABLE
Our ability to return to profitability is largely dependent upon our
ability to introduce new products and technologies and expand our sales efforts
in new geographic and product markets. These activities require substantial
capital, and if we do not have access to sufficient funds, either from our own
operations or through third party financing, our ability to make these necessary
expenditures will be limited. As described in the preceding paragraph, there can
be no assurance that we will be able to obtain these necessary funds from our
own operations. If we are required to seek third party financing, we cannot
assure you that we will be able to obtain financing on terms favorable to us, or
at all. If we obtain additional funds by selling any of our equity securities,
the percentage ownership of our stockholders will be reduced, stockholders may
experience additional dilution, or the equity securities we issue may have
rights, preferences or privileges senior to the common stock. If adequate funds
are not available to us or available to us on satisfactory terms, we may be
required to limit our product development activities or other operations, or
otherwise modify our business strategy. These actions, if taken, could increase
the difficulties we face in returning to sustained profitability.
WE RELY TO A LARGE EXTENT ON INDEPENDENT DISTRIBUTION CHANNELS AND THE
LOSS OF A SIGNIFICANT NUMBER OF DISTRIBUTORS COULD ADVERSELY EFFECT US
We rely on reseller channels, including distributors and systems
integrators, for a significant portion of our revenues. In particular, in
foreign markets we often have one distributor designated for an entire country,
and that distributor provides local support and service for our products. The
loss of one or more significant resellers could adversely affect our business
both in terms of:
o lost revenues;
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o lost market presence; and
o the difficulties we would encounter in servicing customers
introduced to us by our resellers if we do not have other
resellers in that geographic area.
WE ARE EXPOSED TO POTENTIAL DELAYS IN PRODUCT SHIPMENTS BECAUSE WE
CONTRACT OUT OUR PRODUCT MANUFACTURING AND SOME COMPONENTS FOR OUR PRODUCTS ARE
AVAILABLE TO US ONLY FROM A SINGLE SUPPLIER OR A LIMITED NUMBER OF SUPPLIERS
It is not economically feasible for us to develop our own product
manufacturing capacity in the foreseeable future. We rely on others to
manufacture our products and product components and this dependence exposes us
to potential interruptions or delays in product delivery. An interruption could
have a short term effect on our revenues and a longer term effect on our ability
to market our products. Currently, we rely on a single contract manufacturer to
assemble and test most of our products. Also, some of the components we use in
our products are available from only one source or a limited number of
suppliers. Although we have been able to obtain our products and these
components to date, our inability to develop alternative sources if and as
required in the future, or to obtain sufficient sole source or limited source
components as required, could result in delays or reductions in product
shipments.
WE RELY ON A LIMITED NUMBER OF KEY EMPLOYEES, THE LOSS OF ANY OF WHOM
COULD ADVERSELY IMPACT OUR DEVELOPMENT
Our success depends to a significant degree upon the continued
contributions of our management, marketing, engineering and technical personnel,
many of whom would be difficult to replace. In addition, as we continue to
develop the network exchange product line and other new products, we will need
to attract and retain additional qualified personnel. There is intense
competition for qualified personnel in our industry, and there can be no
assurance that we will be able to attract and retain the qualified personnel
necessary for the development of our business. Loss of the services of any of
our key employees would be detrimental to our development. We do not have
employment contracts with our key employees and we do not have "key man" life
insurance on any of our officers or directors.
OUR INTELLECTUAL PROPERTY RIGHTS ARE AN IMPORTANT PROTECTION FOR OUR
PRODUCTS, AND WE COULD BE ADVERSELY AFFECTED IF OUR RIGHTS ARE CHALLENGED OR
CIRCUMVENTED BY COMPETITORS
Our ability to compete successfully within our industry is dependent in
part upon:
o the patents and nondisclosure agreements that we have obtained,
o technical measures that we take to protect confidential
information and
o trade secret, copyright and trademark laws that we rely on to
establish and protect our proprietary rights.
If any of our proprietary rights are challenged or circumvented by
competitors or other companies are able to market functionally similar products,
systems or processes without infringing our proprietary rights, then our results
of operations and the value of our common stock could be materially and
adversely affected.
A PORTION OF OUR REVENUES ARE DERIVED FROM INTERNATIONAL SALES, WHICH
ARE SUBJECT TO FOREIGN REGULATORY STANDARDS AND CURRENCY EXCHANGE RATE
FLUCTUATIONS
Our international sales accounted for 53%, 62% and 63% of our total
revenues in 1998, 1997 and 1996, respectively, and we expect that international
sales will continue to be a significant portion of our business. The conduct of
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international operations subject us to certain risks. Foreign regulatory bodies
continue to establish standards different from those in the United States, and
our products are designed generally to meet those standards. If we are not able
to continue to design our products in compliance with such foreign standards,
there could have an adverse effect on its operating results. Also, our
international business may be affected by changes in demand resulting from
fluctuation in currency exchange rates and tariffs and difficulties in obtaining
export licenses. We do not currently, and we do not expect for the foreseeable
future, that we will hedge against fluctuations in currency exchange rates.
OUR CERTIFICATE OF INCORPORATION AND BY-LAWS CONTAIN PROVISIONS THAT
COULD DELAY OR PREVENT A CHANGE IN CONTROL
Provisions of our certificate of incorporation and by-laws may have the
effect of discouraging, delaying or preventing a take-over attempt that could be
in the best interests of our stockholders. These include provisions that:
o separate our board of directors into three classes;
o limit the ability of our stockholders to call special stockholder
meetings;
o require advance notice of nominations for directors and
stockholder proposals to be considered at stockholder meetings;
and
o require a vote greater than two-thirds to remove directors from
office or amend many of the provisions of our certificate of
incorporation and by-laws.
Our board of directors also has the right, without further action of
the stockholders, to issue and fix the terms of preferred stock, which could
have rights senior to the common stock. We are also subject to the "business
combination" provisions of the Delaware General Corporate Law, which imposes
procedures impeding business combinations with "interested stockholders" that
are not approved of by our board of directors.
IF WE MERGE WITH OPENROUTE, WE MAY ENCOUNTER DIFFICULTIES IN COMBINING
OPERATIONS AND REALIZING SYNERGIES
We have entered into the merger agreement with OpenROUTE with the
expectation that the merger will result in certain benefits including, among
others, operating efficiencies, cost savings and synergies. Achieving the
benefits of the merger will depend in part upon the integration of our business
with OpenROUTE's business in an efficient manner, which we believe will require
considerable effort. In addition, the consolidation of operations will require
substantial attention from management. The diversion of management attention and
any difficulties encountered in the transition and integration process could
have a material adverse effect on us after the merger. We cannot assure you that
we and OpenROUTE will succeed in integrating our operations in a timely manner
or that the expected efficiencies, cost savings and synergies of the merger will
be realized.
FAILURE TO COMPLETE, OR DELAYS IN COMPLETING, THE MERGER COULD HURT OUR
STOCK PRICE AND FUTURE OPERATIONS
If the merger is not completed for any reason, we may be subject to a
number of material risks, including the following:
o we may be required to pay the other a termination fee, and
o the price of our common stock may decline to the extent that the
current market price of our common stock reflects a market
assumption that the merger will be completed.
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In addition, in response to the announcement of the merger, our
customers may delay or defer purchasing decisions. Any delay or deferral of
purchasing decisions by customers could have a material adverse effect on our
business, regardless of whether the merger is ultimately completed. Similarly,
our current and prospective employees may experience uncertainty about their
future role with us until after the merger is completed or if the merger is not
completed. This may adversely affect our ability to attract and retain key
management, sales, marketing and technical personnel.
IF WE COMPLETE THE MERGER, WE WILL INCUR SIGNIFICANT MERGER-RELATED
CHARGES
We estimate that, as a result of the merger, we the will incur
integration costs associated with:
o consolidating corporate headquarters and other administrative
functions;
o terminating certain leases and severance and facility closing
costs associated with consolidating certain product lines; and
o merger-related costs such as financial advisory, legal and
accounting fees and financial printing and other related charges.
IF WE COMPLETE THE MERGER, WE MUST OBTAIN CONSENTS AND WAIVERS UNDER
THE TERMS OF BOTH OUR AND OPENROUTE'S CREDIT FACILITIES
We have a credit facility with Coast Business Credit, under which we
have borrowed approximately $1.2 million as of September 30, 1999. OpenROUTE has
a credit facility with Silicon Valley Bank, under which OpenROUTE had no
borrowings as of September 30, 1999. Under each of these credit facilities, the
lender's consent is required to any change of control transaction or the
borrowed amounts must be repaid. The merger will be deemed a change in control
of each of us and of OpenROUTE for this purpose, and, therefore, before the
merger is completed each of us will be required to obtain a waiver from our
lender or prepay the outstanding amounts owed together with prepayment
penalties. Neither we nor OpenROUTE can provide any assurance that our lenders
will grant a waiver. If a lender does not grant a waiver and we or OpenROUTE, as
the case may be, do not prepay the amount owed, then the credit facility could
be accelerated and all amounts owed to the lender as of that date would be due
immediately.
AFTER THE MERGER, OUR ABILITY TO USE OUR AND OPENROUTE'S NET OPERATING
LOSS CARRYFORWARDS MAY BE LIMITED
As of December 31, 1998, we had federal income tax net operating loss
carryforwards of $38.1 million which begin to expire in 2002. After the merger,
our ability to use these net operating loss carryforwards to reduce our future
tax payments will be limited as a result of the merger. In addition, as of
December 31, 1998, OpenROUTE had federal income tax net operating loss
carryforwards of approximately $33.0 million that begin to expire in 2010. A tax
asset related to this loss carryforward does not appear on OpenROUTE's balance
sheet because it is unclear if OpenROUTE will generate taxable income prior to
the expiration of the net operating loss carryforwards. The extent to which we
may use OpenROUTE's net operating loss carryforwards to reduce our future tax
liability may be limited. As a result of these limitations, our future tax
liability may be greater than the combined tax liabilities of us and OpenROUTE
in the absence of the merger.
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WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act. As required by the Securities Exchange Act, we file reports, proxy
statements and other information with the SEC. The reports, proxy statements and
other information can be inspected and copied at the public reference facilities
maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549 and at regional offices of the SEC at Citicorp Center,
500 West Madison Street, Chicago, Illinois 60661 and at Seven World Trade
Center, 13th Floor, New York, New York 10048. In addition, we are required to
file electronic versions of these documents through the SEC's Electronic Data
Gathering, Analysis and Retrieval System (EDGAR). The SEC maintains a World Wide
Web site at http://www.sec.gov that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the SEC. Copies of these materials may also be obtained at prescribed rates
from the Public Reference Section of the SEC, 450 Fifth Street, N.W., Judiciary
Plaza, Room 1024, Washington, D.C. 20549. The common stock is quoted on the
Nasdaq National Market. Information regarding the trading of our common stock on
the Nasdaq National Market can be obtained from the Nasdaq National Market, 9801
Washingtonian Boulevard, Gaithersburg, Maryland 20878 ((202) 496-2500).
We have filed with the SEC a registration statement on Form S-3 under
the Securities Act of 1933 with respect to the securities being offered by this
prospectus. As permitted by the rules and regulations of the SEC, this
prospectus does not contain all the information set forth in the registration
statement. For further information with respect to us and the offer and sale of
the securities, reference is made to the registration statement. Statements
contained in this prospectus concerning the provisions of documents filed with
the registration statement as exhibits are necessarily summaries of those
documents, and each of these statement is qualified by reference to the copy of
the applicable document filed with the SEC. The registration statement may be
inspected without charge at the public reference facilities of the SEC at the
addresses contained in the preceding paragraph and copies of all or any part of
the registration statement may be obtained from the SEC at prescribed rates.
Pursuant to the rules of the SEC, we are able to "incorporate by
reference" into this document the information that we have on file with the SEC.
This means that we may disclose important information to you by referring you to
other documents. The information incorporated by reference is considered to be
part of this prospectus. In addition, any later information we file with the SEC
and incorporated by reference will update and supersede the information referred
to or contained in this prospectus. We incorporate by reference the documents
listed below and any future filings we make with the SEC under section 13a,
13(c), 14 or 15(d) of the Exchange Act until this offering has been completed:
o Our Annual Report on Form 10-K for the year ending December 31,
1998; and
o Our Quarterly Reports on Form 10-Q for the quarters ending March
31, 1999, June 30, 1999, and September 30, 1999.
o Our Current Report on Form 8-K dated October 14, 1999.
OpenROUTE is also subject to the informational requirements of the
Securities Exchange Act. As required by the Securities Exchange Act, OpenROUTE
files reports, proxy statements and other information with the SEC, which can be
inspected and copied at the public reference facilities maintained by the SEC at
the above addresses or accessed through the EDGAR system at the SEC's World Wide
Web site, http://www.sec.gov, or obtained from the Public Reference Section of
the SEC at the above address. OpenROUTE's common stock is quoted on the Nasdaq
National Market, and information regarding the trading of OpenROUTE's common
stock on the Nasdaq National Market can be obtained from the Nasdaq National
Market at the above address and telephone number.
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SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
Some of the information set forth in this prospectus includes "forward
looking statements" within the meaning of the Private Securities Litigation
Reform Act of 1995. In addition, from time to time, we may publish
"forward-looking statements" within the meaning of Section 27A of the Securities
Act and Section 21E of the Exchange Act or make oral statements that constitute
forward-looking statements. These forward-looking statements may relate to
matters such as anticipated financial performance, future revenues or earnings,
business prospectus, projected ventures, new products, anticipated market
performance and similar matters. The words "budgeted," "anticipate," "project,"
"estimate," "expect," "may," "believe," "potential" and similar statements are
intended to be among the statements that are forward looking statements. Because
these statements reflect the reality of risk and uncertainty that is inherent in
our business, actual results may differ materially from those expressed or
implied by the forward-looking statements. You are cautioned not to place undue
reliance on these forward looking statements, which are made as of the date of
this prospectus.
The Private Securities Litigation Reform Act of 1995 provides a safe
harbor for forward-looking statements. In order to comply with the terms of the
safe harbor, we caution you that a variety of factors could cause our actual
results to differ materially from the anticipated results or other expectations
expressed in our forward-looking statements. These risks and uncertainties, many
of which are beyond our control, include, but are not limited to those set forth
under the caption "Risk Factors" on page 2 and in our filings with the SEC.
We undertake no obligation to release publicly any revisions to the
forward looking statements to reflect events or circumstances after the date of
this prospectus or to reflect unanticipated events or developments.
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PROPOSED MERGER WITH OPENROUTE NETWORKS, INC.
On September 30, 1999, we entered into an agreement and plan of merger
with OpenROUTE Networks, Inc. OpenROUTE is a public company whose shares are
listed on the Nasdaq National Market under the symbol "OPEN." Under the terms of
the merger agreement, Netrix will be the surviving company. Pursuant to the
agreement, we will issue one share of our common stock in exchange for each
share of outstanding OpenROUTE stock. As of November 16, 1999, OpenROUTE
reported that it had 15,527,189 shares of common stock outstanding. Also
pursuant to the merger agreement, the number of directors on our board of
directors will be increased from six to nine. Of the nine directors, four will
be designated by OpenROUTE, who will be OpenROUTE's chief executive officer and
three independent directors. The merger agreement includes representations,
warranties and covenants by each party that are customary for this type of
transaction.
We expect to complete the merger by year-end, although due to the need
to obtain the approval of both our stockholders and OpenROUTE's stockholders, we
cannot state the specific date on which the merger will be completed.
USE OF PROCEEDS
We will not receive any proceeds from the sale of common stock by the
selling security holders. If the warrants are exercised, we will receive up to
$100,000, reflecting the total exercise price.
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SELLING SECURITY HOLDERS
This prospectus relates to the resale of 1,413,660 shares of common
stock. This common stock is issuable upon the conversion of preferred stock or
the exercise of warrants we have recently issued. The terms of the issuances are
described in this section below under the caption "Sale of the preferred stock
and warrants." The following table sets forth, to our knowledge:
o the number of shares of common stock beneficially owned by each
selling security holder;
o the number of shares of common stock to be offered and sold by
the selling security holder; and
o the number of shares of common stock and percentage of
outstanding shares of common stock to be beneficially owned by
the selling security holder after the offer and sale contemplated
by this prospectus, assuming that all the shares offered by the
selling security holder are in fact sold.
Unless otherwise indicated, to our knowledge, each person has sole
investment and voting power, if applicable (or shares these powers with his or
her spouse), with respect to the securities set forth in the following table.
As of November 16, 1999 we had 11,976,821 shares of common stock issued
and outstanding.
<TABLE>
<CAPTION>
Beneficial Ownership
After the Offering (1)
----------------------------
Number of Shares Number of
Beneficially Owned Shares to Number of
Name and Address Prior to the Offering be Sold Shares Percentage
---------------- --------------------- ------- ------ ----------
<S> <C> <C> <C> <C>
Charles Ziegler 45,455 45,455 --- ---
c/o LIT
220 Bush, Suite 580
San Francisco, CA 94104
Donald Abramson 67,275 67,275 --- ---
220 Bush Street, #545
San Francisco, CA 94104
Downco Holdings, Ltd. 72,725 72,725 --- ---
c/o Robert Goodman
1013 Cove Road
Mamaroneck, NY 10543
Paul Johnson 18,185 18,185 --- ---
1112 Park Avenue
New York, NY 10128
Clifford T. Dirkes 36,364 36,364 --- ---
707 Golfview Road
Morrestown, NJ 08057
SoundShore Opportunity Holding Fund Ltd. 36,364 36,364 --- ---
c/o AIG
1281 East Main Street
Stamford, CT 06902
</TABLE>
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<TABLE>
<CAPTION>
Beneficial Ownership
After the Offering (1)
--------------------------------
Number of Shares Number of
Beneficially Owned Shares to Number of
Name and Address Prior to the Offering be Sold Shares Percentage
---------------- --------------------- ------- ------ ----------
<S> <C> <C> <C> <C>
SoundShore Holdings Ltd. 90,910 90,910 --- ---
c/o AIG
1281 East Main Street
Stamford, CT 06902
Triton Capital Investments 90,910 90,910 --- ---
One Sansome, 39th Floor
San Francisco, CA 94104
Hull Overseas, Ltd. 90,910 90,910 --- ---
152 West 57th Street
New York, NY 10019
Richard A. Levy and Susan C. Levy, JTWROS 109,095 109,095 --- ---
1258 Linder Avenue
Highland Park, IL 60035
St. Claire International, Ltd. 36,364 36,364 --- ---
c/o Hedge Funds Services (BVI) Ltd.
Box 23
Ellen L. Shelton Building
Road Town, Tortola
British Virgin Islands
Special Situations Fund III, L.P. 1,454,200(2) 109,095 1,294,205 10.7
153 East 53rd Street, 51st Floor
New York, NY 10022
Special Situations Cayman Fund, L.P. 1,454,200(2) 36,364 1,294,205 10.7
153 East 53rd Street, 51st Floor
New York, NY 10022
Special Situations Technology Fund, L.P. 1,454,200(2) 14,545 1,294,205 10.7
153 East 53rd Street, 51st Floor
New York, NY 10022
363,636 363,636 --- ---
RKB Capital, L.P.
130 West Lake Street
Wayzata, MN 55391
109,095 109,095 --- ---
Omicron Partners L.P.
153 East 53rd Street, 48th Floor
New York, NY 10022
363,636 363,636 --- ---
</TABLE>
-11-
<PAGE>
<TABLE>
<CAPTION>
Beneficial Ownership
After the Offering (1)
--------------------------------
Number of Shares Number of
Beneficially Owned Shares to Number of
Name and Address Prior to the Offering be Sold Shares Percentage
---------------- --------------------- ------- ------ ----------
<S> <C> <C> <C> <C>
Abernathy Group
20 Exchange Place, 38th Floor
New York, NY 10005
50,000 50,000 --- ---
Coast Business Credit
a division of Southern Pacific Bank
1212 Wilshire Boulevard, Suite 1400
Los Angeles, California 90025
</TABLE>
- ----------------------
* Less than 1 percent
(1) Beneficial ownership is determined in accordance with the rules and
regulations of the SEC and generally includes consideration of voting
or investment power with respect to the securities at issue.
Information with respect to beneficial ownership is based upon
information as of November 16, 1999, and assumes that there is
outstanding an aggregate of 11,976,821 shares of common stock, not
including treasury shares. Except as otherwise indicated in the
footnotes below, and subject to community property laws where
applicable, we believe, based upon information furnished by selling
security holders, that the persons named in this table have sole voting
and investment power with respect to all shares of common stock shown
as beneficially owned by them.
(2) Based on a Schedule 13G dated February 12, 1999. Special Situation Fund
III, L.P., Special Situations Cayman Fund, L.P. and Special Situations
Technology Funds, L.P. are affiliated. Includes a total of 1,294,200
shares of common stock and 160,000 shares of common stock issuable upon
conversion of the preferred stock.
SALE OF THE PREFERRED STOCK AND WARRANTS
During the period ended June 30, 1999, we raised funds through a
private offering of 298,187 shares of our Series A 8% convertible preferred
stock. We sold the preferred stock directly to investors at $13.75 per share,
which represented five times the price of our common stock at the time we
committed to undertake the offering. Each share of preferred stock is
convertible into shares of our common stock at a conversion price of $2.75 per
share, which represents five shares of common stock for every share of preferred
stock. The conversion price of the preferred stock will be proportionally
adjusted if we undertake a stock split, stock consolidation or stock dividend
with respect to our common stock. This registration statement provides for the
resale of the common stock. Most of this common stock is subject to limitations
on transfer until May 2000. The resale limitations will be lifted prior to May
2000 as follows:
o if the average closing bid price for our stock price is at least
$3.43 for 10 consecutive trading days, 25% of the common stock
may be sold;
o if the average closing bid price for our stock price is at least
$4.29 for 10 consecutive trading days, an additional 25% of the
common stock may be sold;
o if the average closing bid price for our stock price is at least
$5.36 for 10 consecutive trading days, an additional 25% of the
common stock may be sold; and
o if the average closing bid price for our stock price is at least
$6.71 for 10 consecutive trading days, all remaining shares will
may be sold.
-12-
<PAGE>
As of the date of this prospectus, our stock price has been above $5.36
for 10 consecutive trading days, so a portion of the shares have been released
form this transfer restriction.
Each share of preferred stock has a liquidation preference equal to its
purchase price, plus accrued and unpaid dividends. Dividends are cumulative from
May 14, 1999, and are payable semi-annually, in arrears, on April 30 and October
31 of each year, commencing October 31, 1999. Dividends are payable in cash or
shares of common stock, at the our election. The preferred stock is redeemable
at our option at any time after the closing bid price for our common stock on
the NASDAQ Stock Market has equaled or exceeded $6.00 for 10 consecutive trading
days. The redemption price is $17.50 per share plus accrued but unpaid dividends
to the date of repurchase.
We sold the preferred stock directly to the investors. Among the
investors was Special Situations Fund III, L.P., our largest stockholder, and
Special Situations Cayman Fund, L.P. and Special Situations Technology Fund,
L.P., each of whom is affiliated with Special Situations Fund III, L.P. Other
than through their position as a significant stockholder of Netrix, we have no
relationship with Special Situations Fund III, L.P. and its affiliates, and we
have no material relationship with any other purchaser of the preferred stock.
In connection with the private placement, we received net proceeds of
approximately $4.0 million. We are using these proceeds to fund operations,
severance and other restructuring activities, and marketing and sales
initiatives.
In connection with the offering of the preferred stock, Renwick
Corporate Finance and Mr. William Morrison introduced investors to us. We did
not compensate Mr. Morrison for his introductions, but we paid Renwick for its
introductions $88,000 in cash and warrants to purchase 32,000 shares of common
stock at $2.75 per share, subject to customary anti-dilution protections. The
SEC has informed us that they believe that Renwick may have acted as an
unregistered broker-dealer in violation of the Securities Exchange Act of 1934
in connection with these introductions. See "Risk Factors - The Securities and
Exchange Commission has indicated that it believes one of the finders in our
recent private placement may be acting as an unregistered broker-dealer in
violation of the Securities Exchange Act of 1934 and this could subject us to a
repurchase obligation that could have an adverse effect on our financial
position." Renwick has performed other consulting services for us, and for these
services we have paid them $77,500 in cash and 70,000 warrants with exercise
prices between $3.00 and $7.00 per share.
In April 1999, in connection with obtaining an amendment and waiver of
the minimum tangible net worth covenant contained in our credit agreement, we
issued to Coast Business Credit, a division of Southern Pacific Bank, warrants
to acquire 50,000 shares of common stock. The warrants are exercisable at $2.00
per share, and are exercisable until June 2004. Other than in its capacity as
our primary lender, we have no relationship with Coast Business Credit.
-13-
<PAGE>
DESCRIPTION OF SECURITIES
Our authorized capital stock consists of 29,000,000 shares of common
stock, $.05 par value per share, of which 11,976,821 shares are outstanding,
fully paid and non-assessable prior to this offering, and 1,000,000 shares of
preferred stock, par value $.05 per share, 225,449 of which are outstanding
prior to this offering. An additional 4,825,000 shares of common stock are
reserved under our stock option plans, and there are currently 3,068,149 options
outstanding. In addition, we have outstanding warrants to acquire an aggregate
of 449,500 shares of common stock.
PREFERRED STOCK
Our board of directors is authorized, without further action by the
stockholders, to issue one million shares of preferred stock in one or more
series and to fix the rights, preferences, privileges and restrictions of the
preferred stock they issue, including dividend rights, dividend rates,
conversion rights, voting rights, terms of redemption, redemption prices and
liquidation preferences and the number of shares constituting and the
designation of any series. A majority of the common stock covered by this
prospectus is issuable by us upon conversion of our Series A 8% convertible
preferred stock. We issued this stock in May 1999, and its terms are described
above under the caption "Sale of the preferred stock and warrants" in the
section of this prospectus titled "Selling Stockholders."
The rights and terms relating to any new series of preferred stock
could adversely affect the voting power or other rights of the holders of common
stock. Also, we issue preferred stock as a method of discouraging, delaying or
preventing a change in control of Netrix.
COMMON STOCK
The holders of common stock are entitled to one vote for each share
held of record in the election of directors and with respect to all other
matters to be voted on by stockholders. Holders of shares of common stock do not
have cumulative voting rights. Therefore, the holders of more than 50 percent of
the shares voting for the election of directors can elect all of the directors.
The holders of common stock are entitled to receive dividends when, as and if
declared by the Board of Directors out of legally available funds. In the event
of liquidation, dissolution or winding up of Netrix, the holders of common stock
are entitled to share ratably in all assets remaining available for distribution
after payment of liabilities and after provision has been made for each class of
stock, if any, having preference over the common stock. Our common stock does
not provide to the holders any conversion, preemptive or other subscription
rights, and there are no redemption provisions applicable to the common stock.
The rights of the holders of common stock are subject to any rights that may be
fixed for holders of preferred stock, when and if any preferred stock is issued.
All of the shares of common stock currently outstanding are duly authorized,
validly issued, fully paid and non-assessable.
WARRANTS
There are currently outstanding 449,500 warrants to purchase common
stock. Each warrant entitles the registered holder to purchase one share of our
common stock, $.05 par value, at exercise prices ranging from $1.75 to $7.00 per
share, exercisable at various times until June 30, 2004.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the common stock is American Stock Transfer
& Trust Company, whose address is 40 Wall Street, New York, New York, 10005,
telephone number 212-936-5100.
-14-
<PAGE>
PLAN OF DISTRIBUTION
The common stock may be offered and sold from time to time by one or
more of the selling security holders, or by pledgees, donees, transferees or
other successors in interest. No selling security holder is required to offer or
sell any of his common stock. The selling security holders anticipate that, if
and when offered and sold, the common stock will be offered and sold in
transactions effected on the Nasdaq Stock Market at then prevailing market
prices. These transactions could include block transactions. The selling
security holders reserve the right, however, to offer and sell the common stock
on any other national securities exchange on which the common stock is or may
become listed or in the over-the-counter market, in each case at then prevailing
market prices, or in privately negotiated transactions each at a price then to
be negotiated. All offers and sales made on the Nasdaq Stock Market or any other
national securities exchange or in the over-the-counter market will be made
through or to licensed brokers and dealers. No agreements, arrangements or
understandings have been entered into with any broker or dealer, and no brokers
or dealers have been selected, in connection with the offer and sale of the
common stock. All proceeds from the sale of the common stock will be paid
directly to the selling security holders and will not be deposited in an escrow,
trust or other similar arrangement. We will not receive any of the proceeds from
the sales of the common stock by the selling security holders. However, we will
receive proceeds from the exercise of the warrants by the selling security
holders. No discounts, commissions or other compensation will be allowed or paid
by the selling security holders or by us in connection with the offer and sale
of the common stock except that usual and customary brokers' commissions may be
paid by the selling security holders.
The selling broker may act as agent or may acquire shares of common
stock or interests in common stock as principal or pledgee and may, from time to
time, effect distributions of shares of common stock or interests. If a dealer
is utilized in the sale of common stock in respect of which the prospectus is
delivered, the selling security holders will sell common stock to the dealer as
principal. The dealer may then resell the common stock to the public at varying
prices to be determined by the dealer at the time of resale.
We and the selling security holders have agreed to indemnify each other
with respect to any liability that results from:
o any untrue statement or alleged untrue statement contained in
this prospectus; or
o any material omission or alleged omission from the registration
statement or this prospectus
to the extent the untrue statement or omission was included in the registration
statement or this prospectus in reliance upon information furnished by the
indemnifying party.
We will pay the legal, accounting and other fees and expenses related
to the offer and sale of the common stock contemplated by this prospectus,
excluding commissions charged by any broker or dealer acting on behalf of a
selling security holder. The fees and expenses we will pay are estimated to be
$10,000.
-15-
<PAGE>
LEGAL MATTERS
The validity of the common stock offered by this prospectus will be
passed upon for Netrix by Kelley Drye & Warren LLP.
EXPERTS
The Audited Consolidated Financial Statements and Schedule incorporated
by reference in this prospectus and elsewhere in the registration statement have
been audited by the independent public accountant firm of Arthur Andersen LLP.
These reports are included in this prospectus in reliance upon Arthur Andersen
LLP's accounting and auditing authority and expertise in relation to the
provision of these reports.
-16-
<PAGE>
NO DEALER, SALES PERSON OR OTHER PERSON HAS BEEN
AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE
ANY REPRESENTATION NOT CONTAINED IN THIS
PROSPECTUS, AND, IF GIVEN OR MADE, THAT
INFORMATION OR REPRESENTATION MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY NETRIX
CORPORATION. THIS PROSPECTUS DOES NOT NETRIX CORPORATION
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY ANY OF THE ECURITIES IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE AN OFFER. NEITHER THE DELIVERY 1,413,660
OF THIS PROSPECTUS NOR ANY SALE MADE PURSUANT TO SHARES OF
THIS PROSPECTUS SHALL, UNDER ANY CIRCUMSTANCES, COMMON STOCK
CREATE ANY IMPLICATION THAT THERE HAS BEEN
NO CHANGE IN THE AFFAIRS OF NETRIX CORPORATION
SINCE THE DATE OF THIS PROSPECTUS OR THAT
THE INFORMATION CONTAINED IN THIS PROSPECTUS IS
CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
_____________ _____________
TABLE OF CONTENTS PROSPECTUS
PAGE _____________
Netrix Corporation................................2
Risk Factors......................................2
Where You Can Find More Information...............7
Special Note Regarding Forward Looking
Statements...................................8
Proposed Merger with
OpenROUTE Networks, Inc. ....................9
Use of Proceeds...................................9
Selling Security Holders.........................10
Description of the Securities....................14
Plan of Distribution.............................15 December __, 1999
Legal Matters....................................16
Experts..........................................16
-17-
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following table sets forth the estimated expenses to be incurred in
connection with the distribution of the securities being registered. The
expenses will be paid by Netrix Corporation.
TYPE OR NATURE OF EXPENSE AMOUNT TO BE PAID
------------------------- -----------------
SEC registration fee............................. $1,247.74
Accounting fees and expenses..................... 5,000.00
Legal fees and expenses.......................... 1,500.00
Miscellaneous.................................... 1,000.00
--------
Total............................................ $8,747.74
=========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware General Corporation Law (the "DGCL")
provides that a Delaware corporation may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (a "proceeding") (other than an action by or in the right of the
corporation) by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with that action, suit or
proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful. A Delaware corporation may indemnify any person under
Section 145 who was, is or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the corporation to
procure judgment in its favor, by reason of such fact as provided in the
preceding sentence, against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or settlement of that
action or suit, except that no indemnification shall be made in respect of the
an action or suit if he did not act in good faith and in a manner he reasonably
believed to be in or not opposed to our best interests and unless, and then only
to the extent that, a court of competent jurisdiction shall determine upon
application that he is fairly and reasonably entitled to indemnity for those
expenses as the court shall deem proper. A Delaware corporation must indemnify
any person who was successful on the merits or otherwise in defense of any
action, suit or proceeding or in defense of any claim, issue or matter in any
proceeding, by reason of such fact as provided in the preceding two sentences
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection the indemnified claim. A Delaware corporation may pay for the
expenses (including attorneys' fees) incurred by an officer or director in
defending a proceeding in advance of the final disposition to repay the amount
advances if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation.
Section 102(b)(7) of the DGCL permits a corporation to provide in its
certificate of incorporation that a director shall not be personally liable to
the corporation or its stockholders for monetary damages for a breach of
fiduciary duty as a director, except for liability (i) for any breach of the
II-1
<PAGE>
director's duty of loyalty to the corporation or its stockholders, (ii) for any
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) in respect of certain unlawful dividend payments
or stock redemptions or repurchases, or (iv) for any transaction from which the
director derived an improper personal benefit. The DGCL permits the purchase of
insurance on behalf of directors and officers against any liability asserted
against directors and officers and incurred by them in their capacity as an
officer or director, or arising out of their status as an officer or director,
whether or not the corporation would have the power to indemnify directors and
officers against that liability. We have acquired officers' and directors'
liability insurance of $1 million for members of our Board of Directors and
executive officers.
At present, there is no pending litigation or other proceeding
involving any of our directors or officers for which indemnification is being
sought, and we are not aware of any threatened litigation that may result in
claims for indemnification by any officer or director.
Article Eighth of our certificate of incorporation provides that we
will indemnify all persons we are permitted to indemnify under the Delaware
General Corporation Law, and that this indemnification will be to the fullest
extent permitted the Delaware General Corporation Law.
ITEM 16. EXHIBITS
The exhibits listed below have been filed as part of this registration
statement.
4.1* Amended and restated certificate of incorporation
(incorporated into this registration statement by reference to
Exhibit 3.1 to Netrix's registration statement on Form S-1
filed on September 18, 1992, as amended (File No.
33-50464) (the "1992 S-1").
4.2* Amended and restated by-laws of Netrix (incorporated into this
registration statement by reference to Exhibit 3.2 of
the 1992 S-1).
4.3* Specimen certificate of common stock of the registrant
(incorporated into this registration statement by reference to
Exhibit 4.2 to the 1992 S-1).
4.4* Certificate of designations for the form of Series A 8%
convertible preferred stock.
4.5* Supplemental certificate of designations for the form of
Series A 8% convertible preferred stock (incorporated by
reference to Exhibit 4.2 to Netrix's quarterly report on Form
10-Q filed on August 16, 1999, Commission file no.
0-50464).
4.6* Form of Warrant issued to Renwick Securities, Inc.
(incorporated by reference to Exhibit 10.3 to Netrix's
quarterly report on Form 10-Q filed on August 16, 1999,
Commission file no. 0-50464).
4.7* Form of Warrant issued to Coast Business Credit (incorporated
by reference to Exhibit 10.2 to Netrix's quarterly report on
Form 10-Q filed on August 16, 1999, Commission file no.
0-50464).
4.8** Amendment to Certificate of Incorporation dated August 26,
1999.
4.9* Form of Warrant issued to Kaufman Bros. L.P. (incorporated by
reference to Exhibit 4.6 to Netrix's quarterly report
on Form 10-Q filed November 15, 1999, (Commission file no.
0-50464)).
5.1** Opinion on Legality.
10.1* Agreement and Plan of Merger between Netrix Corporation and
OpenROUTE Networks, Inc. dated September 30, 1999
(incorporated by reference to Exhibit 2.1 to Netrix's current
report on Form 8-K filed on October 14, 1999, Commission file
no. 0-50464).
10.2* Amendment to Agreement and Plan of Merger between Netrix
Corporation and OpenROUTE Networks, Inc. dated November 9,
1999 (incorporated by reference to Exhibit 10.4 to Netrix's
quarterly report on Form 10-Q filed on November 15, 1999,
Commission file No. 0-50464).
II-2
<PAGE>
23.1 Consent of Arthur Andersen LLP.
23.2** Consent of Kelley Drye & Warren LLP (contained in Exhibit 5.1).
23.3 Additional Consent of Kelley Drye & Warren LLP.
24** Power of Attorney (included within signature page).
--------------------------------
* Incorporated by reference.
** Filed previously
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
A. To file, during any period in which offers or sales are being
made, a post-effective amendment of this registration
statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933.
(ii) To include in the prospectus any facts or events
statement (or most recent post-effective amendment
arising after the effective date of the registration
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the 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.
B. That, for the purposes of determining any liability under the
Securities Act of 1933, 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 thereof.
C. To remove from registration by means of post-effective
amendment any of the securities registered which remain unsold
at the termination of the offering.
D. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant
to any charter provisions, by-laws, contract, arrangements,
statute 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
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 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 a controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed
in the Act and will be governed by the final adjudication of
such issue.
II-3
<PAGE>
E. Subject to the terms and conditions of Section 15(d) of the
Securities Exchange Act of 1934, as amended, Netrix
Corporation hereby undertakes to file with the Securities and
Exchange Commission such supplementary and periodic
information, documents and reports as may be prescribed by any
rule or regulation of the Commission heretofore or hereafter
duly adopted pursuant to authority conferred in that Section.
II-4
<PAGE>
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, as
amended, Netrix Corporation certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and authorizes this
registration statement to be signed on its behalf by the undersigned, in the
City of Herndon, State of Virginia, on November 16, 1999.
NETRIX CORPORATION
By /S/ STEVEN T. FRANCESCO
----------------------------
Steven T. Francesco
Chief Executive Officer
In accordance with the requirements of the Securities Act of 1933, this
amendment 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>
Chief Executive Officer and
/S/ STEVEN T. FRANCESCO Chairman of the Board of Directors November 29, 1999
- ------------------------------------------- Principal Executive Officer)
Steven T. Francesco
/S/ LYNN C. CHAPMAN President, Chief Operating Officer November 29, 1999
- ------------------------------------------- and Director
Lynn C. Chapman
/S/ PETER J. KENDRICK Vice President-Finance and Administration November 29, 1999
- ------------------------------------------- and Chief Financial Officer
Peter J. Kendrick (Principal Financial and Accounting Officer)
Director November 29, 1999
- -------------------------------------------
Gregory McNulty
/S/ JOHN M. FACCIBENE* Director November 16, 1999
- -------------------------------------------
John M. Faccibene
/S/ RICHARD YALEN* Director November 29, 1999
- -------------------------------------------
Richard Yalen
/S/ DOUGLAS J. MELLO* Director November 16, 1999
- -------------------------------------------
Douglas J. Mello
</TABLE>
* By Steven T. Francesco, attorney-in-fact.
II-5
<PAGE>
ITEM 27. EXHIBITS
(a) The exhibits listed below have been filed as part of this
registration statement.
EXHIBIT NO. DESCRIPTION
----------- -----------
The exhibits listed below have been filed as part of this registration
statement.
4.1* Amended and restated certificate of incorporation
(incorporated into this registration statement by reference to
Exhibit 3.1 to Netrix's registration statement on Form S-1
filed on September 18, 1992, as amended (File No.
33-50464) (the "1992 S-1").
4.2* Amended and restated by-laws of Netrix (incorporated into this
registration statement by reference to Exhibit 3.2 of
the 1992 S-1).
4.3* Specimen certificate of common stock of the registrant
(incorporated into this registration statement by reference to
Exhibit 4.2 to the 1992 S-1).
4.4* Certificate of designations for the form of Series A 8%
convertible preferred stock.
4.5* Supplemental certificate of designations for the form of
Series A 8% convertible preferred stock (incorporated by
reference to Exhibit 4.2 to Netrix's quarterly report on Form
10-Q filed on August 16, 1999, Commission file no.
0-50464).
4.6* Form of Warrant issued to Renwick Securities, Inc.
(incorporated by reference to Exhibit 10.3 to Netrix's
quarterly report on Form 10-Q filed on August 16, 1999,
Commission file no. 0-50464).
4.7* Form of Warrant issued to Coast Business Credit (incorporated
by reference to Exhibit 10.2 to Netrix's quarterly report on
Form 10-Q filed on August 16, 1999, Commission file no.
0-50464).
4.8** Amendment to Certificate of Incorporation dated August 26,
1999.
4.9* Form of Warrant issued to Kaufman Bros. L.P. (incorporated by
reference to Exhibit 4.6 to Netrix's quarterly report
on Form 10-Q filed November 15, 1999, (Commission file no.
0-50464)).
5.1** Opinion on Legality.
10.1* Agreement and Plan of Merger between Netrix Corporation and
OpenROUTE Networks, Inc. dated September 30, 1999
(incorporated by reference to Exhibit 2.1 to Netrix's current
report on Form 8-K filed on October 14, 1999, Commission file
no. 0-50464).
10.2* Amendment to Agreement and Plan of Merger between Netrix
Corporation and OpenROUTE Networks, Inc. dated November 9,
1999 (incorporated by reference to Exhibit 10.4 to Netrix's
quarterly report on Form 10-Q filed on November 15, 1999,
Commission file No. 0-50464).
II-6
<PAGE>
23.1 Consent of Arthur Andersen LLP.
23.2** Consent of Kelley Drye & Warren LLP (contained in Exhibit 5.1).
23.3 Additional Consent of Kelley Drye & Warren LLP
24** Power of Attorney (included within signature page).
---------------
*Incorporated by reference
**Filed previously
II-7
<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our reports dated
April 14, 1999 included (or incorporated by reference) in Netrix Corporation's
Form 10-K/A for the year ended December 31, 1998 and to all references to our
firm included in this registration statement.
/S/ ARTHUR ANDERSEN LLP
Vienna, VA
December 1, 1999
<PAGE>
EXHIBIT 23.3
CONSENT OF KELLEY DRYE & WARREN LLP
The undersigned hereby consents to the use of our name, and the
statement with respect to us, appearing under the heading "Risk Factors - The
staff of the Securities and Exchange Commission has indicated that it believes
one of the finders in our recent private placement may have acted as an
unregistered broker-dealer in violation of the Securities Exchange Act of 1934
and this could subject us to a repurchase obligation that could have an adverse
effect on our financial position " included in the Registration Statement.
/S/ KELLEY DRYE & WARREN LLP
Stamford, CT
December 1, 1999
