<PAGE> 1
Registration number 333-3400
Filed pursuant to Rule 424(b)(3)
PROSPECTUS
1,243,292 SHARES
NETMANAGE, INC.
COMMON STOCK
-------------------
This Prospectus relates to 1,243,292 shares of Common Stock, par value
$.01 (the "Common Stock") which are being offered and sold by certain
stockholders (the "Selling Stockholders") of NetManage, Inc. (the "Company"). Of
such shares, 8,187 are issuable upon the exercise of outstanding warrants and
320 are issuable upon the exercise of an outstanding option. The Selling
Stockholders, directly or through agents, broker-dealers or underwriters, may
sell the Common Stock offered hereby from time to time on terms to be determined
at the time of sale, in transactions on the Nasdaq National Market or in
privately negotiated transactions. The Selling Stockholders and any agents,
broker-dealers or underwriters that participate in the distribution of the
Common Stock may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933, as amended (the "Act"), and any commission received by
them and any profit on the resale of the Common Stock purchased by them may be
deemed to be underwriting discounts or commissions under the Act. The Company
will not receive any proceeds from the sale of shares by the Selling
Stockholders. See "Selling Stockholders" and "Plan of Distribution."
The Common Stock of the Company is quoted on the Nasdaq National Market
under the symbol "NETM." The last reported sales price of the Company's Common
Stock on the Nasdaq National Market on May 28, 1996 was $18.00 per share.
--------------------
THIS OFFERING INVOLVES A HIGH DEGREE OF RISK. SEE "RISK FACTORS" ON PAGE 3.
---------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
No underwriting commissions or discounts will be paid by the
Company in connection with this offering. Estimated expenses payable by
the Company in connection with this offering are $13,500. The aggregate
proceeds to the Selling Stockholders from the Common Stock will be the
purchase price of the Common Stock sold less the aggregate agents'
commissions and underwriters' discounts, if any, and other expenses of
issuance and distribution not borne by the Company. See "Plan of
Distribution."
The Company has agreed to indemnify the Selling Stockholders
and the Selling Stockholders have agreed to indemnify the Company
against certain liabilities, including liabilities under the Act.
May 29, 1996
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AVAILABLE INFORMATION
The Company is subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith, files annual and quarterly reports, proxy statements and other
information with the Securities and Exchange Commission (the "Commission"). Such
reports, proxy statements and other information may be inspected and copied at
the Commission's Public Reference Section, 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, as well as at the Commission's Regional Offices at 7
World Trade Center, 13th Floor, New York, New York 10048; and 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such material can be
obtained at prescribed rates from the Public Reference Section of the Commission
at 450 Fifth Street, N.W., Washington, D.C. 20549. The Common Stock of the
Company is quoted on the Nasdaq National Market. Reports and other information
concerning the Company may be inspected at the Nasdaq Stock Market, Inc. at 1735
K Street, N.W. Washington, D.C. 20006.
A registration statement on Form S-3 with respect to the Common Stock
offered hereby (the "Registration Statement") has been filed with the Commission
under the Act. This Prospectus does not contain all of the information contained
in such Registration Statement and the exhibits and schedules thereto, certain
portions of which have been omitted pursuant to the rules and regulations of the
Commission. For further information with respect to the Company and the Common
Stock offered hereby, reference is made to the Registration Statement and the
exhibits and schedules thereto. Statements contained in this Prospectus
regarding the contents of any contract or any other documents are not
necessarily complete and, in each instance, reference is hereby made to the copy
of such contract or document filed as an exhibit to the Registration Statement.
The Registration Statement, including exhibits thereto, may be inspected without
charge at the Securities and Exchange Commission's principal office in
Washington, D.C., and copies of all or any part thereof may be obtained from the
Public Reference Section, Securities and Exchange Commission, Washington, D.C.,
20549, upon payment of the prescribed fees.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, filed or to be filed with the Commission under
the Exchange Act are hereby incorporated by reference into this Prospectus:
(i) The Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995; and
(ii) The description of the Company's Common Stock contained
in the Company's Registration Statement on Form 8-A filed with the Commission on
July 26, 1993.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to
the termination of the offering shall be deemed to be incorporated by reference
herein and to be a part hereof from the date of filing of such documents. Any
statement contained in this Prospectus or in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any subsequently-filed document which also is or is
deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any and all of the documents that have been
incorporated by reference herein (not including exhibits to such documents
unless such exhibits are specifically incorporated by reference herein or into
such documents). Such request may be directed to NetManage, Inc., Attention:
Walter Amaral, 10725 North DeAnza Boulevard, Cupertino, California 95014,
telephone number (408) 973-7171.
--------------------
NetManage and the NetManage logo are registered trademarks of
NetManage. Chameleon is a trademark of NetManage. All other trademarks are
property of their respective owners.
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THE COMPANY
The Company was incorporated in California in April 1990 and
reincorporated in Delaware in September 1993. Unless the context otherwise
requires, references in this Prospectus to the "Company" or "NETM" refer to
NetManage, Inc. and its subsidiaries. The Company's executive offices are
located at 10725 North DeAnza Boulevard, Cupertino, California 95014, and its
telephone number is (408) 973-7171.
RISK FACTORS
Except for the historical information contained herein, the discussion
in this Prospectus contains forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ materially from those
discussed here. Factors that could cause or contribute to such differences
include, but are not limited to, those discussed in this section and the
documents incorporated herein by reference. In addition to the other information
in this Prospectus, the following risk factors should be considered carefully in
evaluating the Company and its business before purchasing shares of the Common
Stock offered hereby.
FLUCTUATIONS IN QUARTERLY OPERATING RESULTS
The Company expects to experience significant fluctuations in future
quarterly operating results that may be caused by many factors, including among
others, demand for the Company's products, introduction or enhancement of
products by the Company or its competitors; technological changes in computer
networking; the size and timing of individual orders; market acceptance of new
products; mix of distribution channels through which the Company's products are
sold; mix of international and domestic revenue; seasonality of revenues;
quality control of products; customer order deferrals in anticipation of new
products; changes in the Company's operating expenses; personnel changes;
foreign currency exchange rates; and general economic conditions. As a result,
the Company believes that period-to-period comparisons of its results of
operations are not necessarily meaningful and should not be relied upon as
indications of future performance. Although the Company has experienced
significant growth in recent periods, such growth rates will not be sustainable
and should not be relied upon as indicative of future operating results.
Because the Company generally ships software products within a short
period after receipt of an order, the Company typically does not have a material
backlog of unfilled orders, and revenues in any quarter are substantially
dependent on orders booked in that quarter. The Company's expense levels are
based in part on its expectations as to future revenues and to a large extent
are fixed. Therefore, the Company may be unable to adjust spending in a timely
manner to compensate for any unexpected revenues shortfall. Accordingly, any
significant shortfall of demand in relation to the Company's expectations or any
material delay of customer orders would have an almost immediate adverse impact
on the Company's operating results and on the Company's ability to maintain
profitability. Fluctuations in operating results may also result in volatility
in the price of the Company's Common Stock.
The Company has recently experienced rapid growth in the number of
employees and the geographic area of its customer base and operations. These
increases have resulted in substantial demands on the Company's management
resources. The Company's future operating results will be dependent in part on
its ability to continue to implement and improve its operating and financial
controls and to expand, train and manage its management and employee base. There
can be no assurance that the Company will be able to manage such changes
successfully.
COMPETITION
The market for inter-networking software products is intensely
competitive and characterized by rapid changes in technology and evolving
standards. To maintain or improve its position in this industry, the Company
must continue to enhance its current products and develop new products in a
timely fashion. The Company competes directly with providers of Windows
inter-networking applications for the TCP/IP protocol such as FTP Software
("FTP"), International Business Machines Corporation ("IBM"), Microsoft
Corporation ("Microsoft"), Novell, Inc. ("Novell") and Sun Microsystems, Inc.
("Sun") as well as several other companies.
Many of the Company's competitors have substantially greater financial,
technical, sales, marketing and other resources, as well as greater name
recognition and a larger customer base, than the Company. In addition, the
market for the
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Company's products is characterized by significant price competition, and the
Company expects that it will face increasing pricing pressures from its current
competitors. Moreover, because there are low barriers to entry into the software
market and because the market is rapidly evolving and subject to rapid
technological change, the Company believes that competition will persist and
intensify in the future. Accordingly, there can be no assurance that the Company
will be able to provide products that compare favorably with the products of the
Company's competitors or that competitive pressures will not require the Company
to reduce its prices. Any material reduction in the price of the Company's
products would negatively affect gross margins as a percentage of net revenues
and would require the Company to increase software unit sales in order to
maintain net revenues.
DEPENDENCE ON NEW PRODUCTS AND RAPID TECHNOLOGICAL CHANGE
The market for the Company's products is characterized by rapidly
changing technology, evolving industry standards, changes in customer needs and
frequent new product introductions. The Company's future success will depend on
its ability to enhance its current products, to develop new products on a timely
and cost-effective basis that meet changing customer needs and to respond to
emerging industry standards and other technological changes. In particular, the
Company's strategy requires it to maintain compatibility with Windows and TCP/IP
and to maintain drivers that offer a standard Windows user interface with access
to computer systems such as IBM and IBM-compatible mainframe computers, Digital
Equipment Corporation ("Digital") VAX computers, IBM AS/400 computers, UNIX and
NetWare servers, UNIX workstations offered by companies such as Digital,
Hewlett-Packard Co. ("Hewlett-Packard"), IBM and Sun and PCs operating in DOS,
Windows, Windows for Workgroups, Windows NT, 0S/2 and Macintosh environments.
Any failure by the Company to anticipate or respond adequately to changes in
technology and customer preferences, or any significant delays in product
development or introduction, would have a material adverse effect on the
Company's results of operations. The failure to develop on a timely basis these
or other enhancements incorporating new functionality could cause customers to
delay purchase of the Company's current products and thereby adversely affect
the Company's results of operations. There can be no assurance that the Company
will be successful in developing new products or enhancing its existing products
on a timely basis, or that such new products or product enhancements will
achieve market acceptance.
Software products as complex as those offered by the Company may
contain undetected errors or failures when first introduced or as new versions
are released. There can be no assurance that, despite testing by the Company and
by current and potential customers, errors will not be found in new products
after commencement of commercial shipments, resulting in loss of or delay in
market acceptance.
PRODUCT CONCENTRATION
Since the Company's inception, revenues from the Chameleon family of
products have represented substantially all of the Company's revenues, and the
Company expects that revenues from these products will continue to account for a
substantial portion of the Company's revenues for the foreseeable future. The
life cycles of the Company's products are difficult to estimate due in large
measure to increasing competition and the future effect of product enhancements,
including developments in the hardware and software environments in which
Chameleon operates. Declines in demand for the Chameleon products, whether as a
result of competition, technological change, industry-wide price reductions or
otherwise, would have a material adverse effect on the Company's operating
results.
DEPENDENCE ON TCP/IP PROTOCOL
The Company's current products are designed around TCP/IP, an open,
non-proprietary communications protocol. Microsoft Corporation has begun
shipping its own protocol for TCP/IP communications with the Windows 95
operating system. Any reduction in the use of TCP/IP could materially adversely
affect the Company's results of operations. In the event that an alternative
protocol were to reduce the use of the TCP/IP protocol, the Company would have
to design applications to bring the functionality of its products to the
competing protocol. There can be no assurance that the Company would be
successful in doing so.
DEPENDENCE ON MICROSOFT WINDOWS
Substantially all of the Company's net revenues have been derived from
the sales of products that provide inter-networking applications for the
Microsoft Windows operating environment and are marketed primarily to Windows
users.
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As a result, sales of the Company's products would be materially adversely
affected by market developments adverse to Windows. In addition, the Company's
strategy of developing products based on the Windows operating environment is
substantially dependent on its ability to gain pre-release access to, and to
develop expertise in, current and future Windows developments by Microsoft. No
assurance can be given as to the ability of the Company to provide on a timely
basis products compatible with future Windows releases.
PRODUCT DISTRIBUTION AND SUPPORT
In the United States, the Company primarily ships its products directly
to end-users. As part of the Company's continuing strategy to develop multiple
distribution channels, the Company expects to increasingly utilize resellers,
particularly value-added resellers, systems integrators and retailers, in
addition to distributors and original equipment manufacturers. Internationally,
the Company has sales offices in London, Munich, Paris, Tokyo and Haifa, Israel,
and primarily utilizes local distributors.
The Company expects that indirect sales will grow as a percentage of
both domestic and total revenues and expects that any material increase in the
Company's indirect sales as a percentage of revenues will adversely affect the
Company's average selling prices and gross margin due to the lower unit prices
that are typically charged when selling through indirect channels. There can be
no assurance that the Company will be able to attract resellers and distributors
who will be able to market the Company's products effectively and will be
qualified to provide timely and cost-effective customer support and service. The
Company ships products to resellers and distributors on a purchase-order basis,
and many of the Company's resellers and distributors carry competing product
lines. Therefore, there can be no assurance that any reseller or distributor
will continue to represent the Company's products, and the inability to recruit
or retain important resellers or distributors could adversely affect the
Company's results of operations.
In addition to expanding its indirect sales, the Company plans to
continue to build its internal sales and marketing staff in order to increase
its direct sales. There can be no assurance that such internal expansion will be
successfully completed or that the Company's sales and marketing organizations
will successfully compete against the significantly more extensive and
well-funded sales and marketing operations of many of the Company's competitors.
INTERNATIONAL OPERATIONS
International revenues, including export sales, represented
approximately 30% and 19% of the Company's net revenues in 1995 and 1994,
respectively. The Company expects that international sales will continue to
account for a significant portion of its net revenues. There can be no
assurance, however, that the Company will be able to maintain or increase
international market demand for the Company's products or that the Company's
international distributors will be able to effectively meet that demand. Risks
inherent in the Company's international business activities generally include
currency fluctuations, unexpected changes in regulatory requirements, tariffs
and other trade barriers, costs and risks of localizing products for foreign
countries, longer accounts receivable payment cycles, difficulties in managing
international operations, potentially adverse tax consequences, repatriation of
earnings and the burdens of complying with a wide variety of foreign laws. There
can be no assurance that such factors will not have an adverse effect on the
Company's future international sales and, consequently, on the Company's results
of operations.
DEPENDENCE ON KEY EMPLOYEES
The Company's success depends to a significant extent on the
performance of a number of senior management personnel, including the Company's
founder and Chief Executive Officer, Zvi Alon. The loss of the services of key
officers, particularly Mr. Alon, would have a material adverse effect on the
Company. The Company does not have key person insurance on any of its officers
and has no employment agreements with such officers.
The Company's success also will continue to depend in part on its
ability to attract and retain qualified professional, technical, managerial and
marketing personnel. Competition for such personnel in the software industry is
intense. There can be no assurance that the Company will be successful in
attracting and retaining the personnel it requires to develop new and enhanced
products and to conduct its operations successfully.
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INTELLECTUAL PROPERTY AND PROPRIETARY RIGHTS
The Company relies primarily on a combination of patent, copyright and
trademark laws, trade secrets, confidentiality procedures and contractual
provisions to protect its proprietary rights. The Company seeks to protect its
software, documentation and other written materials under patent, trade secret
and copyright laws, which afford only limited protection. Despite the Company's
efforts to protect its proprietary rights, unauthorized parties may attempt to
copy aspects of the Company's products or to obtain and use information that the
Company regards as proprietary. Policing unauthorized use of the Company's
products is difficult, and while the Company is unable to determine the extent
to which piracy of its software products exists, software piracy can be expected
to be a persistent problem. In selling its products, the Company relies
primarily on "shrink wrap" licenses that are not signed by licensees and,
therefore, may be unenforceable under the laws of certain jurisdictions. In
addition, the laws of some foreign countries do not protect the Company's
proprietary rights to as great an extent as do the laws of the United States.
There can be no assurance that the Company's means of protecting its proprietary
rights will be adequate or that the Company's competitors will not independently
develop similar technology. In addition, the Company has received and may
receive in the future communications from third parties asserting that the
Company's products infringe, or may infringe, the proprietary rights of third
parties, seeking indemnification against such infringement or indicating that
the Company may be interested in obtaining a license from such third parties.
There can be no assurance that any such claims would not result in protracted
and costly litigation.
CONCENTRATION OF SHARE OWNERSHIP
Based upon the shares outstanding as of February 29, 1996, the
Company's Chief Executive Officer, and the Company's officers, directors and
their affiliates as a group, beneficially own approximately 23.6% and 27.5%,
respectively, of the Company's outstanding Common Stock. As a result, these
stockholders are able to exercise significant influence over all matters
requiring stockholder approval, including the election of directors and approval
of significant corporate transactions.
POSSIBLE VOLATILITY OF STOCK PRICE
The Company's stock price has experienced volatility in the past, and
the Company believes that factors such as quarterly fluctuations in results of
operations and announcements of new products by the Company or by its
competitors may cause the market price of the Common Stock to fluctuate.
Moreover, in recent years the stock market in general, and the shares of
technology companies in particular, have experienced extreme price fluctuations.
These broad market and industry fluctuations, in addition to matters particular
to the Company, may adversely affect the market price of the Company's Common
Stock.
EFFECT OF ANTITAKEOVER PROVISIONS
The Company's Board of Directors has the authority to issue up to
5,000,000 shares of Preferred Stock and to determine the price, rights,
preferences and privileges of those shares without any further vote or action by
the stockholders. The rights of the holders of Common Stock will be subject to,
and may be adversely affected by, the rights of the holders of any Preferred
Stock that may be issued in the future. While the Company has no present
intention to issue shares of Preferred Stock, such issuance, while providing
desirable flexibility in connection with possible acquisitions and other
corporate purposes, could have the effect of making it more difficult for a
third party, to acquire a majority of the outstanding voting stock of the
Company. In addition, the Company is subject to the anti-takeover provisions of
Section 203 of the Delaware General Corporation Law, which prohibit the Company
from engaging in a "business combination" with an "interested stockholder" for a
period of three years after the date of the transaction in which the person
became an interested stockholder, unless the business combination is approved in
a prescribed manner. The application of Section 203 also could have the effect
of delaying or preventing a change of control of the Company. Furthermore,
certain provisions of the Company's Certificate of Incorporation may have the
effect of delaying or preventing changes in control or management of the
Company, which could adversely affect the market price of the Company's Common
Stock.
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INTEGRATION OF OPERATIONS
The Company recently acquired Syzygy Communications, Inc. and AGE Logic, Inc.,
and the Company regularly evaluates product and technology acquisition
opportunities and may make acquisitions in the future. Product and technology
acquisitions entail numerous risks, including difficulties in the assimilation
of acquired operations and products, diversion of management's attention to
other business concerns and potential loss of key employees of acquired
companies. No assurance can be given as to the ability of the Company to
successfully integrate the operations and personnel acquired to date or, if
applicable, in the future, and the failure of the Company to do so could have a
material adverse effect on the Company's results of operations.
The Company now conducts its business in several different locations at least
in part because of the acquisitions completed in the past. Coordination of
research, development, sales and marketing efforts at these various sites may
impair the Company's ability to perform efficiently and may be exacerbated if
the Company continues to expand its physical locations through internal growth
or to acquire other companies in disparate locations.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of Common Stock by the
Selling Stockholders in the offering.
SELLING STOCKHOLDERS
The following table sets forth the names of the Selling Stockholders, the
number of shares of Common Stock owned beneficially by each of them as of
February 29, 1996 and the number of shares which may be offered pursuant to this
Prospectus. This information is based upon information provided by the Selling
Stockholders. The Selling Stockholders may offer all, some or none of their
Common Stock.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY NUMBER SHARES
OWNED PRIOR TO OFFERING(1) OF SHARES BENEFICIALLY OWNED
-------------------------- BEING AFTER OFFERING(1)(3)
OFFERED ----------------------
-------
NAME NUMBER PERCENT(2) NUMBER PERCENT(2)
---- ------ ---------- ------ ----------
<S> <C> <C> <C>
Peter J. Shaw & Elaine R. Shaw, 420,636 * 394,306 26,330 *
Trustees of the Peter and Elaine
Shaw Family Trust (4)
Charles Rice (5) 139,069 * 139,069 0 *
Steven Jackowski (6) 123,069 * 123,069 0 *
Midland Bank, Trustee Jersey 121,765 * 121,765 0 *
Limited re TCV (7)
Evan Stone, Trustee, Jennifer Lynn 76,950 * 76,950 0 *
Shaw Minors Trust UAD 8/1/80
fbo Jennifer Lynn Shaw and
Jeremy Andrew Shaw Minors
Trust UAD 8/1/80 fbo Jeremy
Andrew Shaw (8)
Thompson Clive 70,927 * 70,927 0 *
Investments plc (9)
Charles Kimmel (10) 77,475 * 59,841 17,634 *
Midland Bank, Trustee Jersey 43,740 * 43,740 0 *
Limited re TCV LP (11)
Garth Conboy (12) 40,041 * 30,704 9,337 *
Robert S. Alford (13) 36,102 * 36,102 0 *
Kurt Ziegler, Jr. (14) 32,528 * 16,265 16,263 *
</TABLE>
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<TABLE>
<S> <C> <C> <C>
Robert L. Hare (15) 24,073 * 22,982 1,091 *
James J. Conboy and Mary Ann 19,494 * 19,494 0 *
Conboy, Trustees of the Conboy
Trust Dated 12/15/1992 (16)
NFT Ventures, Inc. (17) 18,159 * 18,159 0 *
Craig A. Schmidt (18) 12,504 * 12,504 0 *
David Mark Ryter (19) 10,722 * 10,722 0 *
Kevin C. Little (18) 9,747 * 9,747 0 *
Gail M. Schweighart 6,153 * 6,153 0 *
Robert E. Astley (18) 4,670 * 4,670 0 *
Michael Elias (20) 3,129 * 3,129 0 *
Thomas Clive Inc., Trustee fbo 3,129 * 3,129 0 *
Peter H. Ziebelman 401(k) (21)
James Gordon (22) 3,076 * 3,076 0 *
Jung Hammel-Verheiden (18) 2,548 * 2,548 0 *
Michael Bergknoff (18) 2,311 * 2,311 0 *
Gary Meloney (18) 1,539 * 1,539 0 *
Geoffrey Blum (18) 974 * 974 0 *
Paul Kamp (18) 974 * 974 0 *
David Kosower (18) 974 * 974 0 *
Gary E. Gwin (18) 701 * 701 0 *
Ben Fahy (18) 530 * 530 0 *
Ake Nilsson (18) 487 * 487 0 *
Patsi Little (18) 487 * 487 0 *
Ronaldo G. Sacay (18) 436 * 436 0 *
Paul M. Seckendorf (18) 414 * 414 0 *
Robert J. Weideman (18) 400 * 400 0 *
Robert J. Querido (18) 390 * 390 0 *
William Lessard (18) 389 * 389 0 *
Sandy Snider (18) 365 * 365 0 *
James A. Carlton (18) 352 * 352 0 *
Guy T. Morgante (18) 320 * 320 0 *
Gregory E. Presson (23) 320 * 320 0 *
L.H. Friend, Weinress, Frankson & 320 * 320 0 *
Presson, Inc. (24)
Cooley Godward Castro Huddleson 320 * 320 0 *
& Tatum (25)
Cathy Christianson (18) 316 * 316 0 *
Jonathan K. Lee (18) 267 * 267 0 *
Dennis McNamara (18) 256 * 256 0 *
Christine Whitby (18) 182 * 182 0 *
Rosendo Gonzalez (18) 126 * 126 0 *
Darren Mace (18) 91 * 91 0 *
</TABLE>
* Less than one percent.
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(1) Unless otherwise indicated below, the persons named in the table have
sole voting and investment power with respect to all shares
beneficially owned by them, subject to community property laws where
applicable.
(2) Applicable percentage of ownership is based on 41,937,647 shares of
Common Stock outstanding on February 29, 1996.
(3) Assumes the sale of all shares offered hereby.
(4) Includes 39,431 shares held in escrow pursuant to the Agreement and
Plan of Reorganization dated November 17, 1995, among NetManage,
NetManage Acquisition Corporation and AGE Logic, Inc. (the "AGE
Agreement"). Also includes 26,330 shares issuable upon the exercise of
outstanding options. Excludes an aggregate of 76,950 shares held in
trust for the children of Peter and Elaine Shaw, for which Peter and
Elaine Shaw disclaim beneficial ownership. Mr. Shaw was President and
Chief Executive Officer of AGE. See Note (8).
(5) Includes 13,906 shares held in escrow pursuant to the AGE Agreement.
Mr. Rice was Vice President, Technical and a Director of AGE.
(6) Includes 11,894 shares held in escrow pursuant to the Agreement and
Plan of Reorganization dated October 16, 1995 among NetManage, Syzygy,
NM Acquisition Corp. and the shareholders of Syzygy (the "Syzygy
Agreement"). Also includes 4,130 shares held in escrow pursuant to the
Escrow and Share Cancellation Agreement between Syzygy and Steven
Jackowski dated June 30, 1995. Mr. Jackowski was Chief Technical
Officer, Secretary and a Director of Syzygy.
(7) Includes 11,788 shares held in escrow pursuant to the Syzygy Agreement.
Also includes 3,887 shares issuable upon the exercise of outstanding
warrants at an exercise price of $7.60 per share. Midland Bank, Trustee
Jersey Limited re TCV was a 10% shareholder of Syzygy.
(8) Includes 7,696 shares held in escrow pursuant to the AGE Agreement. Mr.
Stone is the trustee for shares held in trust for the children of Peter
Shaw. See Note (4).
(9) Includes 6,866 shares held in escrow pursuant to the Syzygy Agreement.
Also includes 2,264 shares issuable upon the exercise of outstanding
warrants at an exercise price of $7.60 per share. Thompson Clive
Investments plc was a 10% shareholder of Syzygy.
(10) Includes 5,984 shares held in escrow pursuant to the AGE Agreement.
Also includes 17,634 shares issuable upon the exercise of outstanding
options. Mr. Kimmel was Chief Financial Officer of AGE.
(11) Includes 4,234 shares held in escrow pursuant to the Syzygy Agreement.
Also includes 1,396 shares issuable upon the exercise of outstanding
warrants at an exercise price of $7.60 per share. Midland Bank, Trustee
Jersey Limited TCV LP was a 10% shareholder of Syzygy.
(12) Includes 3,071 shares held in escrow pursuant to the AGE Agreement.
Also includes 9,337 issuable upon the exercise of outstanding options.
Mr. Conboy was Vice President, Desktop Products and a Director of AGE
and President of Pacer Software, Inc. ("Pacer"), a company acquired by
AGE in March 1995.
(13) Includes 3,610 shares held in escrow pursuant to the AGE Agreement. Mr.
Alford was Vice President, Engineering of AGE.
(14) Includes 1,627 shares held in escrow pursuant to the Syzygy Agreement.
Also includes 16,263 shares issuable upon the exercise of outstanding
options. Mr. Ziegler was President, Chief Executive Officer and a
Director of Syzygy.
(15) Includes 2,298 shares held in escrow pursuant to the AGE Agreement.
Also includes 1,091 shares issuable upon the exercise of outstanding
options.
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<PAGE> 10
(16) Includes 1,949 shares held in escrow pursuant to the AGE Agreement. Mr.
Conboy was Vice President and Chief Financial Officer of Pacer.
(17) Includes 1,816 shares held in escrow pursuant to the Syzygy Agreement.
(18) Includes shares held in escrow pursuant to the AGE Agreement. Ten
percent of the total number of shares registered hereunder are held in
such escrow.
(19) Includes 1,072 shares held in escrow pursuant to the AGE Agreement. Mr.
Ryter was Vice President and a Director of Pacer.
(20) Includes 313 shares held in escrow pursuant to the Syzygy Agreement.
Mr. Elias is an affiliate of Midland Bank, Trustee Jersey Limited re
TCV; Thompson Clive Investments plc and Midland Bank, Trustee Jersey
Limited re TCV LP
(21) Includes 313 shares held in escrow pursuant to the Syzygy Agreement.
Mr. Ziebelman is an affiliate of Midland Bank, Trustee Jersey Limited
re TCV; Thompson Clive Investments plc and Midland Bank, Trustee Jersey
Limited re TCV LP. Mr. Ziebelman was a Director of Syzygy.
(22) Mr. Gordon was a Director of Syzygy.
(23) Includes 320 shares issuable upon the exercise of outstanding warrants
at an exercise price of $15.59 per share. Excludes 320 shares issuable
upon the exercise of an outstanding warrant held by L.H. Friend, of
which Mr. Presson is President and shareholder, for which Mr. Presson
disclaims beneficial ownership.
(24) Includes 320 shares issuable upon the exercise of outstanding warrants
at an exercise price of $15.59 per share.
(25) Includes 320 shares issuable upon the exercise of an outstanding option
at an exercise price of $0.78 per share. Cooley Godward et al
represented AGE Logic Incorporated and represents NetManage in certain
matters.
PLAN OF DISTRIBUTION
The shares of Common Stock offered by the Selling Stockholders may be
sold from time to time to purchasers directly by any of the Selling Stockholders
acting as principal for its own account in one or more transactions at a fixed
price, which may be changed, or at varying prices determined at the time of sale
or at negotiated prices. Alternatively, any of the Selling Stockholders may from
time to time offer the Common Stock through underwriters, dealers or agents who
may receive compensation in the form of underwriting discounts, commissions or
concessions from the Selling Stockholders and/or the purchasers of shares for
whom they may act as agent. Sales may be made on the Nasdaq National Market.
The Selling Stockholders and any agents, broker-dealers or underwriters
that participate in the distribution of the Common Stock offered hereby may be
deemed to be underwriters within the meaning of the Act, and any discounts,
commissions or concessions received by them and any profit on the resale of the
Common Stock purchased by them might be deemed to be underwriting discounts and
commissions under the Act.
In order to comply with the securities laws of certain states, if
applicable, the Common Stock may be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
Common Stock may not be sold unless it has been registered or qualified for sale
or an exemption from registration or qualification requirements is available and
is complied with.
Of the 1,243,292 shares of Common Stock offered hereby, 8,187 shares
are issuable upon exercise of outstanding warrants at an exercise price ranging
from $0.78 per share to $15.59 per share, and 320 shares are issuable upon
exercise of an outstanding option at an exercise price of $0.78 per share.
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<PAGE> 11
The Company has agreed to register the Selling Stockholders' Common
Stock under applicable Federal and state securities laws under certain
circumstances and at certain times. The Company will pay substantially all of
the expenses incident to the offering and sale of the Common Stock to the
public, other than commissions, concessions and discounts of underwriters,
dealers or agents. Such expenses (excluding such commissions and discounts) are
estimated to be $13,500. The above-referenced agreement provides for
cross-indemnification of the Selling Stockholders and the Company to the extent
permitted by law, for losses, claims, damages, liabilities and expenses arising,
under certain circumstances, out of any registration of the Common Stock.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for
the Company by Cooley Godward Castro Huddleson & Tatum, Palo Alto, California.
EXPERTS
The financial statements and schedules incorporated by reference in the
registration statement have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their report with respect thereto, and are
included herein in reliance upon the authority of said firm as experts in
accounting and auditing.
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No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained in
this Prospectus and, if given or made, such other information and
representations must not be relied upon as having been authorized by the
Company. This Prospectus does not constitute an offer or solicitation by
anyone in any state in which such offer or solicitation is not authorized,
or in which the person making such offer or solicitation is not qualified to
do so, or to any person to whom it is unlawful to make such offer or
solicitation. The delivery of this Prospectus at any time does not imply
that the information is correct as of any time subsequent to the date
hereof.
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TABLE OF CONTENTS
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Available Information ................................................................................ 2
Incorporation of Certain
Documents by Reference............................................................................. 2
Risk Factors.......................................................................................... 3
Use of Proceeds....................................................................................... 7
Selling Stockholders.................................................................................. 7
Plan of Distribution................................................................................. 10
Legal Matters ....................................................................................... 11
Experts ............................................................................................. 11
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