1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 January 22, 2001 Date of Report (Date of earliest event reported) NETERGY NETWORKS, INC. (Exact name of registrant as specified in its charter) Delaware 333-15627 77-0142404 (State or other jurisdiction of (Commission File Number) (I.R.S. Employer incorporation) Identification No.) - --------------------------------------------------------------------------------------------------------- 2445 Mission College Blvd. Santa Clara, California 95054 (Address of principal executive offices) (408) 727-1885 (Registrant's telephone number, including area code)

2 ITEM 5. OTHER EVENTS On January 22, 2001, Netergy Networks, Inc. ("Netergy") issued a press release announcing the resignations of Paul Voois as Chief Executive Officer and Robert Habibi as President and Chief Operating Officer. A copy of the foregoing press release is included as Exhibit 99.1 hereto and is incorporated herein by reference. On January 23, 2001, Netergy issued a press release announcing the resignations of: Robert Habibi from Netergy's Board of Directors; Jean-Luc Calonne as Senior Vice President for Business Operations/General Manager of Netergy's Montreal office; and approximately 50 employees from the Netergy's Montreal office. A copy of the foregoing press release is included as Exhibit 99.2 hereto and is incorporated herein by reference. On January 24, 2001, Netergy issued a press release announcing the appointment of Joe Parkinson as interim Chief Executive Officer, and the addition of Bryan Martin to the Board of Directors and his appointment as President and Chief Operating Officer. A copy of the foregoing press release is included as Exhibit 99.3 hereto and is incorporated herein by reference. On January 31, 2001, Netergy issued a press release announcing its financial results for its third quarter of fiscal 2001, which ended December 31, 2000. A copy of the foregoing press release is included as Exhibit 99.4 hereto and is incorporated herein by reference. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS (c) Exhibits. Exhibit Number Description -------------- ----------- 99.1 Press release dated January 22, 2001. 99.2 Press release dated January 23, 2001. 99.3 Press release dated January 24, 2001. 99.4 Press release dated January 31, 2001. 2

3 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 hereunto duly authorized. NETERGY NETWORKS, INC. Dated: February 7, 2001 By: /s/ David Stoll ------------------------------------- David Stoll Chief Financial Officer 3

4 EXHIBIT INDEX Exhibit Number Description - -------------- ----------- 99.1 Press release dated January 22, 2001. 99.2 Press release dated January 23, 2001. 99.3 Press release dated January 24, 2001. 99.4 Press release dated January 31, 2001.

1 CONTACT: Veronique Ondella Netergy Networks (408) 654-0886 veronique.ondella@netergynet.com FOR IMMEDIATE RELEASE NETERGY NETWORKS ANNOUNCES EXECUTIVE CHANGES SANTA CLARA, Calif., January 22, 2001 -- Netergy Networks, Inc. (Nasdaq: NTRG) announced today that Paul Voois has resigned as Chief Executive Officer and Robert Habibi has resigned as President and Chief Operating Officer. Voois and Habibi will continue to serve in their current capacities until their successors are named by the Netergy Board of Directors.

1 CONTACTS: Veronique Ondella Martine Nadeau Netergy Networks Netergy Networks (408) 654-0886 (514) 282-8484, x259 veronique.ondella@netergynet.com FOR IMMEDIATE RELEASE NETERGY NETWORKS ANNOUNCES DEPARTURES SANTA CLARA, Calif., January 23, 2001 -- Netergy Networks, Inc. (Nasdaq: NTRG) announced today that Robert Habibi has resigned as a member of Netergy's Board of Directors. In addition, the Company announced that Jean-Luc Calonne, Senior Vice President for Business Operations and General Manager of the Company's Montreal office has resigned. Approximately 50 employees of Netergy's Montreal office have also submitted their resignations.

1 CONTACTS: Veronique Ondella Martine Nadeau Netergy Networks Netergy Networks (408) 654-0886 (514) 282-8484, x259 veronique.ondella@netergynet.com FOR IMMEDIATE RELEASE NETERGY NETWORKS ANNOUNCES APPOINTMENTS SANTA CLARA, Calif., January 24, 2001 -- Netergy Networks, Inc. (Nasdaq: NTRG) announced today that the Company's Board of Directors has appointed Joe Parkinson interim Chief Executive Officer of the Company. Mr. Parkinson has been serving as Chairman of the Company's Board of Directors and will continue in that capacity. In connection with the appointment of Mr. Parkinson as interim CEO, the Board of Directors established a search committee to find a permanent CEO. The committee consists of Mr. Parkinson, Bill Tai, and Bernd Girod. The Company's Board of Directors also appointed Bryan Martin to the Board and named him President and Chief Operating Officer of the Company. Mr. Martin has been with the Company for ten years, most recently as Senior Vice President of Engineering Operations. He previously served on the Company's Board of Directors. Paul Voois' resignation as Chief Executive Officer of the Company became effective today. Dr. Voois will be staying with the Company as Vice President of its Solutions Group and will remain on the Company's Board of Directors. With today's appointments, Netergy's Board of Directors consists of Lee Camp, Bernd Girod, Guy Hecker, Christos Lagomichos, Joe Markee, Bryan Martin, Joe Parkinson, Bill Tai and Paul Voois. The officers of the Company, in addition to Joe Parkinson and Bryan Martin, are the following Vice Presidents: Ted Beck, Philip Bednarz, Jonathan Foster, David Stoll, and Paul Voois.

1 CONTACT: Martine Nadeau Netergy Networks, Inc. (514) 282-8484 x259 martine.nadeau@netergynet.com NETERGY NETWORKS ANNOUNCES THIRD QUARTER FISCAL 2001 RESULTS FOR IMMEDIATE RELEASE SANTA CLARA, Calif., January 31, 2001 -- Netergy Networks, Inc. (Nasdaq: NTRG) today announced financial results for its third quarter of fiscal 2001, which ended December 31, 2000. Total revenues for the third quarter of fiscal 2001 were $4.1 million, compared with $6.2 million for the same period in the prior year and $3.9 million in the prior fiscal quarter. The net loss for the quarter, including the cumulative effect of a change in accounting principle and other non-cash items, was $11.8 million, or $0.47 per share, compared with a net loss of $2.2 million, or $0.12 per share for the same period last year, and a net loss of $15.0 million, or $0.60 per share for the prior fiscal quarter. The company recorded a $1.1 million non-cash expense during the third quarter of fiscal 2001 to account for a beneficial conversion feature associated with the convertible subordinated debentures and related warrants issued in December 1999. The expense, which was presented as a cumulative effect of a change in accounting principle, increased the net loss per basic and diluted share for the quarter by $0.05 per share. ABOUT NETERGY NETWORKS Netergy Networks is a provider of Internet Protocol (IP) network services solutions and embedded network appliance technology for converged voice and data networks. The company is based in Santa Clara, California, and has offices in Canada, France and the United Kingdom. For more information, visit Netergy Networks' web site at http://www.netergynet.com/ FINANCIAL TABLES TO FOLLOW

2 NETERGY NETWORKS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA) (UNAUDITED) Three Months Ended Nine Months Ended DECEMBER 31, December 31, DECEMBER 31, December 31, 2000 1999 2000 1999 ------------- ------------- ------------- ------------- Product revenues $ 2,388 $ 4,941 $ 9,962 $ 15,715 License and other revenues 1,063 1,297 2,758 3,127 Service revenues 653 -- 1,099 -- ------------- ------------- ------------- ------------- Total revenues 4,104 6,238 13,819 18,842 Cost of revenues 1,948 1,993 5,291 6,792 ------------- ------------- ------------- ------------- Gross profit 2,156 4,245 8,528 12,050 ------------- ------------- ------------- ------------- Operating expenses: Research and development 4,868 2,854 13,870 8,137 Sales, general and administrative 4,497 3,545 12,924 10,918 In-process research and development -- -- 4,563 10,100 Amortization of intangibles 3,612 189 7,375 424 ------------ ------------ ------------ ------------- Total operating expenses 12,977 6,588 38,732 29,579 ------------ ------------ ------------ ------------- Loss from operations (10,821) (2,343) (30,204) (17,529) Other income, net 67 109 1,266 2,185 ------------ ------------ ------------ ------------- Loss before provision for income taxes (10,754) (2,234) (28,938) (15,344) Provision for income taxes -- -- 12 66 ------------ ------------ ------------ ------------- Net loss before cumulative effect of change in accounting principle (10,754) (2,234) (28,950) (15,410) Cumulative effect of change in accounting principle (1) (1,081) -- (1,081) -- ------------ ------------ ------------ ------------- Net loss $ (11,835) $ (2,234) $ (30,031) $ (15,410) ============ ============ ============ ============= Net loss before cumulative effect of change in accounting principle per basic and diluted share $ (0.42) $ (0.12) $ (1.19) $ (0.88) Cumulative effect of change in accounting principle (1) (0.05) -- (0.05) -- ------------ ------------ ------------ ------------- Net loss per basic and diluted share $ (0.47) $ (0.12) $ (1.24) $ (0.88) ============ ============ ============ ============= Basic and diluted shares outstanding 25,337 18,035 24,281 17,421 (1) The company recorded a $1.1 million expense during the third quarter of fiscal 2001 to account for a beneficial conversion feature associated with the convertible subordinated debentures and related warrants issued in December 1999 due to a change in accounting principle.

3 NETERGY NETWORKS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, UNAUDITED) DECEMBER 31, March 31, 2000 2000 ---------- ---------- ASSETS Current assets: Cash and cash equivalents $34,443 $48,576 Accounts receivable, net 2,174 2,394 Inventory 1,481 1,367 Prepaid expenses and other assets 3,174 1,043 ---------- ---------- Total current assets 41,272 53,380 Property and equipment, net 7,645 2,687 Intangibles and other assets 37,438 3,916 ---------- ---------- Total assets $86,355 $59,983 ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $2,500 $ 1,887 Accrued compensation 2,599 2,154 Accrued warranty 559 694 Deferred revenue 5,823 731 Other accrued liabilities 1,875 1,629 ---------- ---------- Total current liabilities 13,356 7,095 Long-term debt 717 -- Convertible subordinated debentures 6,053 5,498 ---------- ---------- Total liabilities 20,126 12,593 Stockholders' equity 66,229 47,390 ---------- ---------- Total liabilities and stockholders' equity $86,355 $59,983 ========== ========== Editors: Netergy is a trademark of Netergy Networks, Inc.