UNITED STATES
	SECURITIES AND EXCHANGE COMMISSION
	Washington, D.C. 20549
	SCHEDULE 13D

 

Under the Securities Exchange Act of 1934
(Amendment No. 10)

 

(Name of Issuer)

 

(Title of Class of Securities)

 

(CUSIP Number)

 

(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)

 

(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 that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 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 disclosures 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).

 

 

 

*                                         Percentage calculated on the basis of 45,870,132 shares of common stock issued and outstanding consisting of (i) 37,570,132 outstanding as of March 28, 2013 as reported by the Company in its preliminary proxy statement filed with the Commission on April 10, 2013 and (ii) 8,300,000 shares issued by the Company on April 3, 2013 pursuant to a public offering reported by the Company on a Form 8-K filed with the Commission on April 3, 2013.

 

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*                                         Percentage calculated on the basis of 45,870,132 shares of common stock issued and outstanding consisting of (i) 37,570,132 outstanding as of March 28, 2013 as reported by the Company in its preliminary proxy statement filed with the Commission on April 10, 2013 and (ii) 8,300,000 shares issued by the Company on April 3, 2013 pursuant to a public offering reported by the Company on a Form 8-K filed with the Commission on April 3, 2013.

 

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*                                         Percentage calculated on the basis of 45,870,132 shares of common stock issued and outstanding consisting of (i) 37,570,132 outstanding as of March 28, 2013 as reported by the Company in its preliminary proxy statement filed with the Commission on April 10, 2013 and (ii) 8,300,000 shares issued by the Company on April 3, 2013 pursuant to a public offering reported by the Company on a Form 8-K filed with the Commission on April 3, 2013.

 

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This Amendment No. 10 amends and supplements the Statement on Schedule 13D filed on December 31, 2007, as amended on January 31, 2008, May 14, 2008, July 25, 2008, November 20, 2008, May 1, 2009, November 16, 2009, March 17, 2010, June 9, 2010 and June 4, 2012 (as amended, the “Schedule 13D”) filed with the Securities and Exchange Commission by Brener International Group, LLC, Marbre Services, Ltd. and Clive Fleissig relating to the common stock, par value $.001 per share of Transwitch Corporation (the “Company”).  Capitalized terms used herein and not otherwise defined in this Amendment No. 10 shall have the meanings set forth in the Schedule 13D.

 

1.              Item 4 of the Schedule 13D is hereby amended by adding the following:

 

On April 18, 2013, Gabriel Brener, Chairman and Chief Executive Officer of Brener International Group, sent the Board of Directors a letter, a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference.

 

2.              Item 5 of the Schedule 13D is herby amended and restated as follows:

 

(a) — (b)  The following table sets forth information with respect to the shares beneficially owned by each person or entity named in Item 2 hereof.

 

Name		Number of Shares		Percent of Outstanding(1)
Brener International Group		470,000		1.02	%
Marbre Services, Ltd.		1,465,200		3.19	%
Clive Fleissig		12,500		.03	%

 

(1)                                Percentage calculated on the basis of 45,870,132 shares of common stock issued and outstanding consisting of (i) 37,570,132 outstanding as of March 28, 2013 as reported by the Company in its preliminary proxy statement filed with the Commission on April 10, 2013 and (ii) 8,300,000 shares issued by the Company on April 3, 2013 pursuant to a public offering reported by the Company on a Form 8-K filed with the Commission on April 3, 2013.

 

(c)  The table included in Appendix A sets forth transactions in shares by the Filing Persons since transactions were last reported.

 

(d)  No person other than the Filing Persons has the right to receive or power to direct the receipt of dividends from, or the proceeds of the sale of any of the shares.

 

(e)  On April 3, 2013 the Company reported the issuance of 8,300,000 shares of common stock in a public offering.  As a result of such issuance the Filing Persons no longer beneficially own more than 5% of the common stock of the Company.

 

3.                                      Item 7 of the Schedule 13D is hereby amended by adding the following:

 

Exhibit:		Description:
99.1		Letter dated April 18, 2013 from Gabriel Brener to the Board of Directors of the Company.

 

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4.                                      Except as specifically provided herein, this amendment does not modify any of the information  previously reported in the Schedule 13D.

 

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.

 

 

April 19, 2013
	Brener International Group, LLC
	By:	/s/ GABRIEL BRENER
	Name: Gabriel Brener
	Title: Chairman and Chief Executive Officer
	Marbre Services, Ltd.
	By:	/s/ SARA L. DE NUÑEZ
	Name: Sara L. De Nuñez
	Title: Authorized Agent
	/s/ CLIVE FLEISSIG
	Clive Fleissig

 

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Appendix A

 

The following table sets forth transactions in Transwitch Corporation shares by Brener International Group since transactions were last reported.  All transactions were effected in the open market.

 

Sales:

 

Date		Number of Shares		Gross Proceeds excluding Commission
8/1/2012		3,850		$	3,420
8/1/2012		34,500		$	29,678
8/2/2012		50,000		$	42,864
8/8/2012		26,885		$	22,905
8/9/2012		10,267		$	8,625
8/10/2012		10,438		$	8,658
8/13/2012		19,861		$	16,479
8/14/2012		50,000		$	42,795
8/15/2012		54,199		$	48,188

 

Purchases:

 

Date
4/3/2013		86,000		$	39,560
4/4/2013		14,000		$	6,440

 

Neither Mabre Services Ltd. nor Clive Fleissig has not engaged in any transactions in Transwitch Corporation shares since transactions were last reported.

 

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Exhibit 99.1

 

Brener International Group

421 N. Beverly Drive

Beverly Hills, California 90210

 

April 18, 2013

 

Via Facsimile and e-mail

 

Board of Directors

Transwitch Corporation

Three Enterprise Drive

Shelton, CT 06484

 

Gentlemen:

 

After reviewing the Company’s Form 10-K and preliminary proxy statement it is abundantly clear that the only viable path for the Company is a sale.  A sale of the Company would provide the Company with access to capable management and enable the Company to enjoy economics of scale for its out of balance administrative costs.

 

The current management team has been completely incapable of operating the Company in a manner that created value for stockholders.  In 2009, the year prior to Dr. Khatibzadeh becoming Chief Executive Officer the Company had revenues of over $56 million and a net loss of approximately $11.5 million.  Last year, the Company had revenues of less than $18 million and a net loss of more than $18.2 million.  Under Dr. Khatibzadeh’s leadership revenues have declined by 68% and the net loss increased by more than 58%.  During Dr. Khatibzadeh’s short tenure the Company has undergone two major restructurings.  The first was supposed to restore the Company to profitability.  It didn’t and it is doubtful that the second restructuring will be any more successful than the first.  In fact, at the end of 2012 the Company’s independent auditors expressed substantial doubt as to whether the Company could continue as a going concern.

 

Despite the atrocious performance of the Company over the last three years the Company has compensated its directors and officers at inappropriate levels.  In 2012 the Company paid its five named executed officers more than $1.365 million of cash compensation, more than 11% of the Company’s gross revenues.  In addition, the members of the Board received approximately $270,000 of cash compensation.  All in all, the Company paid cash compensation to its named executive officers and directors of more than $1.637 million, or more than 14% of its gross revenues.  The Company also granted stock awards that will significantly dilute stockholders.

 

If the Company were to be part of a larger organization there could be economies of scale for administrative costs.  For example, at the end of 2009 the Company had 30 administrative employees.  At the end of 2012 the Company, despite

 

 

Board of Directors

April 18, 2013

Page 2

 

68% less revenues than in 2009, had 22 administrative employees.  In fact, nearly 20% of its employees were classified as administrative.

 

Finally, I note that the 90% of the short-term incentive plan award for the five named executive officers is based on the Company’s revenues.  I believe that these targets should be based on profit, rather than revenue.  The Company’s stockholders do not benefit if revenues grow but the Company does not move towards profitability.

 

As the Company changes its business strategy yet again, I would hope that the Board would also explore a sale of the Company.  If the Board insists on remaining independent substantial changes should be made to management and the Board.

 

	Sincerely,
	/s/ Gabriel Brener
	Gabriel Brener