INTRUSION INC — Major Shareholding Notification 1998

Oct 2, 1998

SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 ODS Networks, Inc. - ------------------------------------------------------------------------------- (Name of Issuer) Common Stock - ------------------------------------------------------------------------------- (Title of Class of Securities) 67082N109 - ------------------------------------------------------------------------------- (CUSIP Number) Douglas E. Scott, Esq. 10260 Campus Point Drive San Diego, CA 92121 - ------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) September 25, 1998 - ------------------------------------------------------------------------------- (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 section 240.13d-1(e), 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 section 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 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). CUSIP No. 67082N109 13D Page 2 of 12 Pages 1. NAME OF REPORTING PERSON Science Applications International Corporation S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON ###-##-#### - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) / / (b) / / - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS WC - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) / / - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- NUMBER OF 7. SOLE VOTING POWER 3,100,000 SHARES BENEFICIALLY --------------------------------------------------------- OWNED BY EACH 8. SHARED VOTING POWER N/A REPORTING PERSON --------------------------------------------------------- WITH 9. SOLE DISPOSITIVE POWER 3,100,000 --------------------------------------------------------- 10. SHARED DISPOSITIVE POWER N/A - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 3,100,000 - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES / / - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 15.5% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- CUSIP No. 67082N109 13D Page 3 of 12 Pages Item 1. Security and Issuer. - ------ ------------------- (a) Title of class of equity securities: Common Stock. (b) Name of Issuer: ODS Networks, Inc. (c) Address of the principal executive office of the issuer: 1101 East Arapaho Road Richardson, TX 75081 Item 2. Identity and Background. - ------ ----------------------- (a) Name: Science Applications International Corporation. The executive officers and directors of Science Applications International Corporation are set forth on Appendix A hereto. (b) Principal Business Address: 10260 Campus Point Drive San Diego, CA 92121 (c) Principal Business: Science Applications International Corporation provides diversified professional and technical services and designs, develops and manufactures high-technology products. (d) Criminal Proceedings: During the last five years, neither the Reporting Person nor any executive officer or director of the Reporting Person has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). CUSIP No. 67082N109 13D Page 4 of 12 Pages (e) Civil Proceedings: During the last five years, neither the Reporting Person nor any executive officer or director of the Reporting Person has been party to any civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which such person would have been subject to any judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) State of Incorporation: Delaware. Item 3. Source and Amount of Funds or Other Consideration. - ------ ------------------------------------------------- Funds for the purchase of the securities are derived from the Reporting Person's working capital and the sale of certain assets of the Reporting Person. Specifically, $1,500,000 in cash in addition to certain of the Reporting Person's assets (as set forth in the Asset and Securities Purchase Agreement by and between the Issuer and the Reporting Person dated as of September 25, 1998 (the "Agreement")) were paid to the Issuer in consideration for (a) 1,600,000 shares of Common Stock of the Issuer; (b) a warrant to purchase an additional 750,000 shares of Common Stock of the Issuer at an exercise price of $8.00 per share, exercisable at any time on or before March 25, 2000; and (c) a warrant to purchase 750,000 shares of the Issuer's Common Stock at an exercise price of $10.50 per share, exercisable at any time on or before September 25, 2000. CUSIP No. 67082N109 13D Page 5 of 12 Pages Item 4. Purpose of the Transaction. - ------ -------------------------- The Reporting Person acquired the Common Stock and the warrants (as described below) as an investment and in connection with the Agreement and certain related agreements by and between the Issuer and the Reporting Person pursuant to which the Reporting Person sold to the Issuer certain of the Reporting Person's assets (as set forth in the Agreement) and paid to the Issuer $1,500,000 in exchange for (a) 1,600,000 shares of the Common Stock of the issuer; (b) a warrant to purchase 750,000 shares of Common Stock of the Issuer at an exercise price of $8.50 per share, exercisable at any time on or before March 25, 2000; and (c) a warrant to purchase 750,000 shares of the Common Stock of the Issuer at an exercise price of $10.50 per share, exercisable at any time on or before September 25, 2000. Pursuant to the Stockholder and Voting Agreement dated as of September 25, 1998 by and among the Issuer, the Reporting Person and certain stockholders of the Issuer (the "Stockholder and Voting Agreement"), the Reporting Person has agreed that it will not purchase any additional shares of Common Stock of the Issuer without first obtaining the written consent of the Issuer (other than pursuant to the exercise of the warrants and except to retain the Reporting Person's relative percentage of ownership of the Issuer's Common Stock) (the "Standstill Provision"). Subject to such Standstill Provision, in the future, from time to time, the Reporting Person may purchase additional shares of Common Stock of the Issuer depending on the then prevailing market conditions and the price at which such Common Stock shares are traded in the open market or privately negotiated transactions. CUSIP No. 67082N109 13D Page 6 of 12 Pages Item 5. Interest in Securities of the Issuer. - ------ ------------------------------------ According to the Form 10-Q for the quarter ended June 30, 1998 of the Issuer, there are approximately 16,887,233 shares of Common Stock issued and outstanding (before giving effect to the issuance of the 1,600,000 shares of Common Stock and the 1,500,000 shares of Common Stock issuable upon exercise of the warrants). (a) Amount beneficially owned: 3,100,000 Percent of class: 15.5%. (b) The number of shares as to which the Reporting Person has: (i) Sole power to vote or direct the vote: 3,100,000 shares; (ii) Shared power to vote or direct the vote: none; (iii) Sole power to dispose or direct the disposition of: 3,100,000 shares; (iv) Shared power to dispose or direct the disposition of: none. (c) Recent Transactions: On September 25, 1998, the Reporting Person acquired the Common Stock and the warrants (as described in Items 3 and 4 above) as an investment and in connection with the Agreement (as defined in Item 3 above) and certain related agreements between the Issuer and the Reporting Person pursuant to which the Reporting Person: (i) paid $1,500,000 in cash and transferred to the Issuer certain assets as set forth in the Agreement and (ii) entered into a strategic alliance with the Issuer pursuant to the related agreements. - -------- * Includes up to 1,500,000 shares of Common Stock that the Reporting Person has a right to acquire pursuant to the warrants described in Items 3 and 4. Such shares are beneficially owned by the Reporting Person under Rule 13d-3 because the Reporting Person has a right to acquire such shares within the next 60 days. CUSIP No. 67082N109 13D Page 7 of 12 Pages Pursuant to the Registration Rights Agreement between the Reporting Person and the Issuer, the Reporting Person has, under certain circumstances, various rights related to (d) registration of Common Stock of the Issuer held by the Reporting Person and (e) participation in future sales and issuances of securities by the Issuer. Pursuant to the Stockholder and Voting Agreement between the Reporting Person and the Issuer, the Reporting Person has, under certain circumstances, various rights related to the voting of the Common Stock of the Issuer held by the Reporting Person, including, but not limited to, the right to nominate candidate(s) to the Issuer's board of directors, the right to consent to certain transactions of the Issuer and certain preemptive rights with respect to future offerings of stock of the Issuer. The Reporting Person is also subject to the Standstill Provision contained in the Stockholder and Voting Agreement. The Reporting Person paid $1,500,000 in cash and transferred certain assets as set forth in the Agreement in exchange for 1,600,000 shares of Common Stock of the Issuer, a warrant to purchase an additional 750,000 shares of Common Stock of the Issuer at an exercise price of $8.00 per share, exercisable at any time on or before March 25, 2000, and a warrant to purchase an additional 750,000 shares of Common Stock of the Issuer at an exercise price of $10.50 per share, exercisable at any time on or before September 25, 2000. (f) Grants with Respect to Dividends or Sales Proceeds: Not applicable. CUSIP No. 67082N109 13D Page 8 of 12 Pages (g) Date of Cessation of Five Percent Beneficial Ownership: Not applicable. Item 6. Contracts, Arrangements, Understandings or Relationships with - ------ ------------------------------------------------------------- Respect to Securities of the Issuer. ----------------------------------- Pursuant to the Registration Rights Agreement between the Reporting Person and the Issuer, the Reporting Person has, under certain circumstances, various rights related to (a) registration of Common Stock of the Issuer held by the Reporting Person and (b) participation in future sales and issuances of securities by the Issuer. Pursuant to the Stockholder and Voting Agreement between the Reporting Person and the Issuer, the Reporting Person has, under certain circumstances, various rights related to the voting of the Common Stock of the Issuer held by the Reporting Person, including, but not limited to, the right to nominate candidate(s) to the Issuer's board of directors, the right to consent to certain transactions of the Issuer and certain preemptive rights with respect to future offerings of stock of the Issuer. Item 7. Material to be filed as Exhibits. - ------ -------------------------------- Exhibit 1 Stockholder and Voting Agreement dated as of September 25,1998, by and among Science Applications International Corporation, ODS Networks, Inc. and certain stockholders of ODS Networks, Inc. CUSIP No. 67082N109 13D Page 9 of 12 Pages 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 as of October 2, 1998. SCIENCE APPLICATIONS INTERNATIONAL CORPORATION By /s/ Douglas E. Scott ----------------------------------------- Douglas E. Scott Senior Vice President and General Counsel CUSIP No. 67082N109 13D Page 10 of 12 Pages APPENDIX A Directors The following is a list of all directors of Science Applications International Corporation ("SAIC") and certain other information with respect to each director. All directors are United States citizens.

CUSIP No. 67082N109 13D Page 12 of 12 Pages Executive Officers ------------------ The following is a list of all executive officers of Science Applications International Corporation ("SAIC"), excluding executive officers who are also directors. Unless otherwise indicated, each officer's business address is 10260 Campus Point Drive, San Diego, CA 92121. All executive officers are United States citizens. Daniel W. Baldwin Senior Vice President and Treasurer David A. Cox Executive Vice President SAIC 4242 Campus Point Court San Diego, CA 92121 J. Dennis Heipt Senior Vice President for Administration and Corporate Secretary Peter N. Pavlics Senior Vice President and Controller William A. Roper, Jr. Senior Vice President and Chief Financial Officer SAIC 1241 Cave Street La Jolla, CA 92037 Robert A. Rosenberg Executive Vice President SAIC 1710 Goodridge Drive McLean, VA 22102 Douglas E. Scott Senior Vice President and General Counsel