UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 2)*
ZIX CORPORATION
(NAME OF ISSUER)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(TITLE OF CLASS OF SECURITIES)
232046102
(CUSIP NUMBER)
- copy to -
George W. Haywood Gary T. Moomjian, Esq.
c/o Cronin & Vris, LLP Kaufman & Moomjian, LLC
380 Madison Avenue 50 Charles Lindbergh Blvd., Suite 206
24th Floor Mitchel Field, New York 11553
New York, New York 10017 (516) 222-5100
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO
RECEIVE NOTICES AND COMMUNICATIONS)
September 18, 2002
(DATE OF EVENT WHICH REQUIRES FILING OF THIS STATEMENT)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is filing
this schedule because of ss.ss. 240.13d-1(e),or 240.13d-1 (f), or 240.13d-1 (g),
check the following box [ ].
NOTE: Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See ss. 240.13d-7(b) for
other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosure provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that Section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
CUSIP No. 232046102 Page 2 of 5 Pages
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1 NAME OF REPORTING PERSON
I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS (ENTITIES ONLY)
George W. Haywood
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS (See Instructions)
PF
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) OR 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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NUMBER OF 7 SOLE VOTING POWER
SHARES 4,578,339
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BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 145,000 (1)
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EACH 9 SOLE DISPOSITIVE POWER
REPORTING 4,578,339
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PERSON WITH 10 SHARED DISPOSITIVE POWER
145,000 (1)
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,723,339 (See Item 5 herein)
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
(See Instructions) [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
25.3 % (2)
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14 TYPE OF REPORTING PERSON (See Instructions)
IN
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(1) Includes 30,000 shares owned by wife and 115,000 shares owned jointly with
mother.
(2) The percentage of class owned by Mr. Haywood increased to 25.3% from 23.9%
(as reported in Amendment No. 1), however, when calculated on a fully
diluted basis, as a result of the Company's private placement of Series A
Convertible Preferred Stock, Series B Convertible Preferred Stock,
Convertible Notes, and related Warrants, for an aggregate consideration of
$16,000,000 and which closed on September 18, 2002 (the "Offering"), the
percentage of class owned by Mr. Haywood actually declined to less than
23.9%.
2
This Amendment No. 2 hereby amends and supplements the Schedule 13D filed
by George W. Haywood with the Securities and Exchange Commission on July 9, 2002
(the "Schedule 13D") and Amendment No. 1 to the Schedule 13D filed on August 21,
2002, with respect to the common stock, par value $.01 per share (the "Common
Stock"), of Zix Corporation (formerly known as Zixit Corporation) (the
"Company").
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
On September 18, 2002, Mr. Haywood, using personal funds and for an
aggregate consideration of $3,450,000, purchased (i) 947,708 shares of
non-voting Series B Convertible Stock of the Company ("Series B Stock") at $3.60
per share, which are convertible into an aggregate of 902,579 shares of Common
Stock at an initial conversion rate of $3.78 per share of Common Stock, and (ii)
305,986 warrants ("Warrants"), at a purchase price of $.125 per Warrant, to
purchase an aggregate of 305,986 shares of Common Stock at an initial exercise
price of $4.51 per share. The Series B Stock is convertible immediately into
388,366 shares of Common Stock; the balance for 514,213 shares of Common Stock
is not convertible until shareholder approval to allow such conversion is
obtained by the Company so as to comply with Nasdaq's 20% issuance limitation
("Shareholder Approval"). The 514,213 shares of Common Stock underlying the
Series B Stock are not treated as beneficially owned by Mr. Haywood as
Shareholder Approval to permit conversion is not anticipated to occur within 60
days. The Warrants do not become exercisable until March 18, 2003, and
accordingly the underlying Common Stock is not treated as beneficially owned.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) Aggregate number of shares of Common Stock beneficially owned:
4,723,339
Percentage: 25.3 % (1)
(b) 1. Sole power to vote or to direct vote: 4,578,339 (2)
2. Shared power to vote or to direct vote: 145,000 (3)
3. Sole power to dispose or to direct the
disposition: 4,578,339 (2)
4. Shared power to dispose or to direct the
disposition: 145,000 (3)
--------------------
(1) The percentage of class owned by Mr. Haywood increased to 25.3% from
23.9% (as reported in Amendment No. 1), however, when calculated on a
fully diluted basis, as a result of the Offering, the percentage of
class owned by Mr. Haywood actually declined to less than 23.9%.
(2) Represents (A) 4,189,973 shares of Common Stock (of which 11,500 shares
are owned by Mr. Haywood's children) and, (B) 388,366 shares of Common
Stock underlying Series B Stock which is immediately convertible.
(3) Includes 30,000 shares owned by Mr. Haywood's wife and 115,000 shares
owned jointly with Mr. Haywood's mother.
(c) Since the filing of Amendment No. 1 to the Schedule 13D, Mr.
Haywood purchased through the Offering (i) 947,708 shares of Series B
Stock, which Series B Stock is convertible into an aggregate of 902,579 shares
of Common Stock, and (ii) Warrants to purchase an aggregate of 305,986 share of
Common Stock. These securities become exercisable in the timeframes described
above. No other transactions were effectuated during such time period.
3
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
Mr. Haywood entered into a Securities Purchase Agreement, dated September
16, 2002 (the "Securities Purchase Agreement"), with the Company and certain
other investors (the "Investors"), pursuant to which the Company issued and sold
to Mr. Haywood in the Offering 947,708 shares of Series B Stock, which Series B
is convertible into an aggregate of 902,579 shares of Common Stock, and the
Warrants to purchase an aggregate of 305,986 shares of Common Stock. For the
terms of the Securities Purchase Agreement, reference is made to such Agreement
which is attached hereto as Exhibit 10.1 and incorporated herein by reference.
The Series B Stock for 388,366 shares of Common Stock is immediately
convertible; the balance is not convertible until Shareholder Approval is
obtained by the Company so as to comply with Nasdaq's 20% issuance limitation.
The terms and provisions of the Series B Stock are set forth in the Statement of
Designations of the Series B Convertible Preferred Stock of the Company
incorporated herein by reference as Exhibit 3.1. The terms and conditions of the
Warrants are set forth in the Form of Warrant incorporated herein by reference
as Exhibit 10.2.
On September 16, 2002, Mr. Haywood also entered into a Registration Rights
Agreement (the "Registration Rights Agreement") with the Company and the
Investors, pursuant to which the Company has agreed to prepare and file within
30 days of September 18, 2002 a registration statement covering the resale of
the shares of Common Stock issuable upon the conversion or redemption of the
Series A Convertible Preferred Stock and the Series B Stock and the exercise of
the warrants issued to Mr. Haywood and the Investors. The Company is required to
have the Registration Statement declared effective within 105 days after the
closing date. In addition, the Company has agreed to prepare, file and seek the
effectiveness of a registration statement covering the resale of up to an
additional 1,333,333 shares of Common Stock held by Mr. Haywood and 666,667
shares of Common Stock owned by certain other investors named in the
Registration Rights Agreement upon their request at least nine months after the
date of the Registration Rights Agreement. Reference is made to the Registration
Rights Agreement which is incorporated herein by reference as Exhibit 10.3.
In connection with of the Offering, Mr. Haywood and the Investor's agreed
that for so long as the convertible notes or warrants issued to holders of such
convertible notes issued in the Offering are outstanding, neither Mr. Haywood
nor the Investors may engage in a short sale or establish an open put equivalent
position with respect to a number of shares of Common Stock that is greater than
(i) the number of shares of Common Stock for which warrants held by such
Investors and Mr. Haywood are then exercisable, plus (ii) the number of shares
of Common Stock issuable to the Investors and Mr. Haywood pursuant to a notice
of conversion of shares of Series A Convertible Preferred Stock of the Company
or Series B Stock, or a notice of exercise of such warrant, delivered to the
Company no later than the next succeeding business day.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits
3.1 Statement of Designations of the Series B Convertible
Preferred Stock of the Company (incorporated by reference to
Exhibit 3.2 to the Company's Current Report on Form 8-K filed
with the Securities and Exchange Commission on September 20,
2002 (the "Form 8- K")).
10.1 Securities Purchase Agreement (incorporated by reference to
Exhibit 4.1 to the Form 8-K).
10.2 Form of Warrant (incorporated by reference to Exhibit 4.2 to
the Form 8-K).
10.3 Registration Rights Agreement (incorporated by reference to
Exhibit 4.3 to the Form 8-K).
4
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: October 1, 2002
/s/George W. Haywood
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George W. Haywood
5