6-K 1 u44884e6-k.txt FORM 6-K (MADGE NETWORKS N.V.) UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 For February 27, 2002 MADGE NETWORKS N.V. (Translation of registrant's name into English) Transpolis Schiphol Airport Polaris Avenue 23 2132 JH Hoofddorp The Netherlands (Address of principal executive office) Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F Form 20-F X Form 40-F ------- ----- Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934 Yes No X ----- ----- If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- N.A. ----------- Page 1 of 23 Pages Exhibit Index Appears on Page 4 MADGE NETWORKS N.V. ITEM 1. ARTICLES OF ASSOCIATION OF MADGE NETWORKS N.V. On October 10, 2001, Madge Networks NV (the "Company") held a Special General Meeting of Shareholders (the "Meeting"). At this meeting, the Company's shareholders voted in favour of approving an amendment of the Articles of Association of the Company. Subsequent to this the Dutch authorities approved the amendment (as is required under the laws of the Netherlands). Attached as Exhibit 1 to this Form 6-K is a copy of the English translation of the Amended Articles of Association of the Company in force as of November 22, 2001. 2 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. Madge Networks N.V. By: /s/ Martin Malina ----------------------- Martin Malina Chief Executive Officer Date: February 27, 2002 3 EXHIBIT INDEX

~~September~~Page ~~30, December 31, 2001 2000~~ ----~~----------~~ ~~------------~~Exhibit ~~(Unaudited)~~1 ~~Note~~Articles ~~3 ASSETS Current assets: Cash and cash equivalents $ 7,957 $ 18,405 Restricted cash 2,929 3,686 Accounts receivable, net~~ of ~~allowance~~Association ~~for doubtful accounts~~ of ~~$1,448~~Madge atNetworks ~~September~~N.V. ~~30,~~in ~~2001~~force ~~and~~with ~~$1,330~~effect atfrom ~~December~~22 ~~31,~~November 2001 ~~4,312 12,220 Inventories: Raw materials 1,118 2,329 Finished goods~~ 5,280 5,242 ------------- ------------ 6,398 7,571 Current deferred tax assets - 39 Other receivable - 6,290 Prepayments and other current assets 4,655 8,880 Receivable due from Administration 3,745 - Other current assets of discontinued operations 490 13,276 ------------- ------------ Total current assets 30,486 70,367 Property and equipment, net 9,593 12,167 Property and equipment related to discontinued operations net of accumulated depreciation and allowances for losses on disposition 2,208 2,208 Intangible assets, net of accumulated amortization 5,253 11,343 Investments of discontinued operations 2,000 2,000 Restricted cash 4,079 6,254 ------------- ------------ Total assets $53,619 $104,339 ============= ============

September 30, December 31, 2001 2000 -------------- ------------ (Unaudited) Note 3 LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Current liabilities: Short-term borrowing $ 3,364 $ - Accounts payable 5,923 10,588 Deferred consideration 3,016 4,890 Accrued wages and related liabilities 570 2,851 Other accrued liabilities 20,087 30,548 Income taxes payable 7,892 11,593 Current portions of lease obligations 700 629 Current liabilities of discontinued operations 20,063 64,900 -------------- ------------ Total current liabilities 61,615 125,999 Long-term liabilities and lease obligations 217 752 Deposit payable 958 948 -------------- ------------ Total liabilities 62,790 127,699 Commitments Shareholders' equity (deficit): Common shares 29,245 29,146 Additional paid-in capital 170,305 169,694 Treasury stock (404) (404) Retained earnings (deficit) (192,185) (208,486) Accumulated other comprehensive loss (16,132) (13,310) -------------- ------------ Total shareholders' deficit (9,171) (23,360) -------------- ------------ Total liabilities and shareholders' equity (deficit) $ 53,619 $104,339 ============== ============

Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 --------- ---------- --------- ---------- Net sales $14,076 $ 29,024 $58,253 $99,378 Cost of sales: 6,463 16,127 27,429 53,236 --------- ---------- --------- ---------- Gross profit 7,613 12,897 30,824 46,142 Operating expenses: Sales and marketing 3,688 7,449 14,335 30,668 Research and development 300 3,575 3,332 13,115 General and administrative 2,396 2,975 6,624 7,405 Special (gain) charge (3,763) 882 (5,112) 882 --------- ---------- --------- ---------- Total operating expenses 2,621 14,881 19,179 52,070 --------- ---------- --------- ---------- Operating income (loss) from continuing operations 4,992 (1,984) 11,645 (5,928) Net interest income (expense) (18) (319) 1,598 (800) Gain on sale of investment in Red-M - - 7,997 - --------- ---------- --------- ---------- Income (loss) from continuing operations before income taxes and share of losses of associate Red-M 4,974 (2,303) 21,240 (6,728) Provision for income taxes 37 13 932 378 --------- ---------- --------- ---------- Income (loss) from continuing operations before share of losses of associate Red-M and discontinued operations 4,937 (2,316) 20,308 (7,106) Share of losses of associate Red-M - - (1,499) - --------- ---------- --------- ---------- Income (loss) from continuing operations 4,937 (2,316) 18,809 (7,106) Discontinued operations: Loss from discontinued business - (19,342) (2,508) (52,599) --------- ---------- --------- ---------- Net income (loss) $ 4,937 $(21,658) $16,301 $(59,705) ========= ========== ========= ==========

Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 --------- ---------- --------- ---------- Income (loss) per share from continuing operations Basic and diluted $ 0.09 $ (0.05) $ 0.35 $(0.16) Loss per share from discontinued operations Basic and diluted $ - $ (0.41) $ (0.05) $ (1.19) Net income (loss) per share Basic and diluted $ 0.09 $ (0.46) $ 0.30 $ (1.35) Weighted average shares used in computing net income (loss) per share Basic and diluted 54,038 46,832 54,012 44,297

Nine Months Ended September 30, 2001 2000 ------------ ------------ Cash flows from operating activities: Income (loss) from continuing operations Adjustments to reconcile income (loss) from continuing operations to net cash provided by (used in) operating activities of continuing operations: $ 18,809 $ (7,106) Depreciation 2,306 4,559 Amortization of intangibles 6,090 7,755 Loss on disposal of fixed assets 821 2,932 Losses from associate Red-M 1,499 - Profit on sale of investment in Red-M (7,997) - Changes in assets and liabilities net of effect of sale of Red-M: Accounts receivable 7,899 14,932 Restricted cash 2,932 (874) Net inventories 741 7,093 Other receivable 6,290 (4,075) Prepaid expenses and other current assets 322 493 Accounts payable (4,208) (4,822) Other accrued liabilities (11,374) (15,515) Amounts due to associate Red-M (2,806) - Income taxes payable (3,701) (1,641) Deferred tax 39 6 Deferred revenue - (1,063) Deferred consideration (1,874) (2,353) Deposit payable 10 - -------- -------- Net cash provided by operating activities of 15,798 321 continuing operations Net cash used in operating activities of (34,559) (33,241) discontinued operations -------- -------- Net cash used in operating activities (18,761) (32,920) Cash flows from investing activities: Additions to property and equipment (1,555) (631) Purchase of Olicom - (2,000) Proceeds from sale of investment in Red-M 8,731 - Proceeds from sale of Video Business - 305 -------- -------- Net cash provided by (used in) investing 7,176 (2,326) activities of continuing operations Net cash used in investing activities of - (32,438) discontinued operations -------- -------- Net cash provided by (used in) investing activities 7,176 (34,764)

Nine Months Ended September 30, 2001 2000 ------------ ------------ Cash flows from financing activities: Repayments of mortgage and capital lease obligations (464) (1,243) Proceeds from (repayments of) short-term loan, net 3,364 (5,120) Proceeds from issue of common shares 710 65,358 -------- -------- Net cash provided by financing activities of continuing operations 3,610 58,995 Net cash provided by financing activities of discontinued operations - 27,633 -------- -------- Net cash provided by financing activities 3,610 86,628 Net decrease in cash and cash equivalents $ (7,975) $ 18,944 ======== ======== Cash and cash equivalents at the beginning of the period $ 18,405 $18,417 Effect of exchange rate changes on cash (2,473) (3,159) -------- -------- Cash and cash equivalents at the beginning of the period (at period-end exchange rates) 15,932 15,258 Cash and cash equivalents at the end of the period 7,957 34,202 ======== ======== Net decrease in cash and cash equivalents $ (7,975) $ 18,944 ======== ========

September 30, December 31, 2001 2000 -------------- ------------ Current assets of discontinued operations: Cash and cash equivalents $ - $ 9,431 Accounts receivable - 3,355 Amounts due from Madge.web discontinued 490 490 operations ------- ------- Total $490 $13,276 ======= ======= Property and equipment of discontinued operations: Leasehold improvements $ 2,208 $ 2,208 ======= ======= Investment in Emmperative $ 2,000 $ 2,000 ======= ======= Current liabilities of discontinued operations: Accounts payable $ - $10,647 Provision for liabilities/losses of discontinued 20,063 54,253 operations including amounts payable under guarantees ------- ------- Total $20,063 $64,900 ======= =======

In thousands Three months ended Nine months ended (except shares) September 30, September 30, 2001 2000 2001 2000 ------- ------- ------- -------- Numerator for the basic and diluted earnings per share: Total net income (loss) $ 4,937 $(21,658) $16,301 $ 59,705 ======= ======== ======= ======== Income (loss) from continuing operations $ 4,937 $ (2,316) $18,809 $ (7,106) ======= ======== ======= ======== Income (loss) from discontinued operations $ -- $(19,342) $(2,508) $(52,599) ======= ======== ======= ======== Denominator for the basic and diluted earnings per share: Weighted average common shares outstanding: 54,038 46,832 54,012 44,297 ======= ======== ======= ======== Total net income (loss) per share: Basic and diluted $ 0.09 $ (0.46) $ 0.30 $ (1.35) ======= ======== ======= ======== Income (loss) from continuing operations per share: Basic and diluted $ 0.09 $ (0.05) $ 0.35 $ (0.16) ======= ======== ======= ======== Income (loss) from discontinued operations per share: Basic and diluted $ -- $ (0.41) $ (0.05) $ (1.19) ======= ======== ======= ========

(In thousands) (Unaudited) Three months ended Nine months ended September 30, September 30, 2001 2000 2001 2000 -------- -------- -------- -------- NET SALES Madge.connect $ 14,076 $ 29,024 $ 58,098 $ 99,378 Red-M -- -- 155 -- -------- -------- -------- -------- Total $ 14,076 $ 29,024 $ 58,253 $ 99,378 ======== ======== ======== ======== OPERATING INCOME Madge.connect 1,159 2,323 11,243 2,482 Red-M -- (3,538) (5,312) (7,601) Corporate and other 3,833 (769) 5,714 (809) -------- -------- -------- -------- Total $ 4,992 $ (1,984) $ 11,645 $ (5,928) ======== ======== ======== ========

(in thousands) Three months ended Nine months ended September 30, September 30, 2001 2000 2001 2000 -------- -------- -------- -------- Income (loss) from continuing operations $ 4,937 $ (2,316) $ 18,809 $ (7,106) Foreign currency translation Adjustments 110 (2,133) (2,822) (6,656) -------- -------- -------- -------- Comprehensive income (loss) from continuing Operations $ 5,047 $ (4,449) $ 15,987 $(13,762) Comprehensive income (loss) from discontinued Operations $ -- $(19,342) $ (2,508) $(52,599) ======== ======== ======== ======== Comprehensive income (loss) $ 5,047 $(23,791) $ 13,479 $(66,361) ======== ======== ======== ========

(Unaudited) Three months ended Nine months ended (in thousands) September 30, September 30, 2001 2000 2001 2000 -------- -------- -------- -------- Net sales 100% 100% 100% 100% Cost of sales 46 55 47 53 ---- ---- ---- ---- Gross profit 54 45 53 47 Operating expenses: Sales and marketing expenses 26 26 24 31 Research and development expenses 2 12 6 13 General and administrative expenses 17 10 11 7 Special (gain) loss (26) 3 (8) 1 ---- ---- ---- ---- Total operating expenses 19 51 33 52 ---- ---- ---- ---- Income (loss) from operations 35 (6) 20 (5) Net interest (income) loss -- (1) 3 (1) Gain on sale of investment in Red-M -- -- 13 -- ---- ---- ---- ---- Income (loss) before income taxes 35 (7) 36 (6) Provision for income taxes -- -- (2) (1) Share of losses from associate Red-M -- -- (2) -- ---- ---- ---- ---- Net income (loss) 35% (7)% 32% (7)% ==== ==== ==== ====

Filing Compare · MADGE NETWORKS NV