<SEC-DOCUMENT>0001072613-11-000327.txt : 20110318
<SEC-HEADER>0001072613-11-000327.hdr.sgml : 20110318
<ACCEPTANCE-DATETIME>20110318154029
ACCESSION NUMBER:		0001072613-11-000327
CONFORMED SUBMISSION TYPE:	424B3
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20110318
DATE AS OF CHANGE:		20110318

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			NETWORK 1 SECURITY SOLUTIONS INC
		CENTRAL INDEX KEY:			0001065078
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-PREPACKAGED SOFTWARE [7372]
		IRS NUMBER:				113027591
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		424B3
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-143710
		FILM NUMBER:		11698262

	BUSINESS ADDRESS:	
		STREET 1:		445 PARK AVENUE
		STREET 2:		SUITE 1018
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022
		BUSINESS PHONE:		2128295770

	MAIL ADDRESS:	
		STREET 1:		445 PARK AVENUE
		STREET 2:		SUITE 1018
		CITY:			NEW YORK
		STATE:			NY
		ZIP:			10022
</SEC-HEADER>
<DOCUMENT>
<TYPE>424B3
<SEQUENCE>1
<FILENAME>form424_17076.htm
<DESCRIPTION>PROSPECTUS SUPPLEMENT
<TEXT>
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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 18pt; FONT-WEIGHT: bold">NETWORK-1 SECURITY SOLUTIONS, INC.</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Filed Pursuant to Rule 424(b)(3)</font></div>

<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Registration No. 333-143710</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">(To Prospectus dated May&#160;11, 2010)</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">This is a prospectus supplement to our prospectus dated May&#160;11, 2010 (the &#8220;Prospectus&#8221;) relating to the resale from time to time by selling stockholders of up to 9,438,449 shares of our common stock, including shares issuable upon exercise of outstanding warrants and options.&#160;&#160;On March 18, 2011, we filed with the Securities and Exchange Commission a Current Report on Form 8-K.&#160;&#160;The text of the Current Report on Form 8-K is attached to and a part of this supplement.</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">This prospectus supplement should be read in conjunction with the Prospectus and may not be delivered or utilized without the Prospectus.&#160;&#160;This prospectus supplement is qualified by reference to the Prospectus, except to the extent that the information provided by this prospectus supplement supersedes the information contained in the Prospectus.</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">The securities offered by the Prospectus involve a high degree of risk.&#160;&#160;You should carefully consider the &#8220;Risk Factors&#8221; referenced on pages 6-11 of the Prospectus in determining whether to purchase the common stock.</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">The date of this prospectus supplement is March 18, 2011.</font></div>
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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">CURRENT REPORT</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Securities Exchange Act of 1934</font></div>

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<td nowrap width="22%" style="TEXT-ALIGN: left; PADDING-BOTTOM: 2px"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt">Date of Report (Date of earliest event reported):&#160;&#160;&#160;&#160;&#160; </font></td>
<td width="78%" style="BORDER-BOTTOM: black 2px solid"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt">&#160; March 14, 2011</font></td>
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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 17pt"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 17pt">Network-1 Security Solutions, Inc.</font></font></div>

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<td width="33%" style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: center"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt">Delaware</font></td>
<td width="33%" style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: center"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt">1-15288</font></td>
<td width="33%" style="BORDER-BOTTOM: black 2px solid; TEXT-ALIGN: center"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt">11-3027591</font></td>
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<div style="TEXT-ALIGN: center"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt">(State or other jurisdiction</font></div>

<div style="TEXT-ALIGN: center">of incorporation)</div>
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<div style="TEXT-ALIGN: center">Identification No.)</div>
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<div style="TEXT-ALIGN: center; TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt"><font style="DISPLAY: inline">445 Park Avenue, Suite 1018, New York, New York 10022</font></font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Registrant&#8217;s telephone number, including area code:&#160;&#160;(212) 829-5770</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">(Former name or former address, if changed since last report.)</font><br>
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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font>Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (<font style="FONT-STYLE: italic; DISPLAY: inline">see</font> General Instruction A.2. below):</font></div>

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<div style="TEXT-ALIGN: left; TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt"><font style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt"><font style="DISPLAY: inline"><font style="FONT-WEIGHT: bold">Item 5.02</font></font></font></div>
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<div style="TEXT-INDENT: 36pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">On March 14, 2011, the Board of Directors of the Registrant approved a bonus for the year ended December 31, 2010 of $350,000 for Corey M. Horowitz, Chairman and Chief Executive Officer.</font></div>

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<div style="TEXT-INDENT: 36pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">In addition, on March 16, 2011 the Registrant&#8217;s employment agreement, dated June 8, 2009, with Mr. Horowitz was amended pursuant to which, in consideration of a payment of $250,000, Mr. Horowitz agreed to reduce Additional Bonus Compensation and Royalty Bonus Compensation (as such terms are defined in Section 5(b)(ii) of the agreement) payable to him from patents other than the Remote Power Patent from 12.5% to 10%.</font><br>
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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">(c)&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;Exhibits</font></div>

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<div style="TEXT-INDENT: 0pt; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Agreement, dated March 16, 2011, between the Registrant and Corey M. Horowitz, Chairman and Chief Executive Officer.</font></div>
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<font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; TEXT-DECORATION: underline">SIGNATURE</font></font></div>
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<div style="TEXT-INDENT: 36pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">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.</font></div>

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<td colspan="2" valign="top" width="38%"><font style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-WEIGHT: bold">NETWORK-1 SECURITY SOLUTIONS, INC.</font></td>
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<div style="TEXT-ALIGN: center"><font style="FONT-WEIGHT: bold">EXHIBIT INDEX</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Network-1 Security Solutions, Inc.</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Corey M. Horowitz</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Dear Corey:</font></div>

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<div style="TEXT-INDENT: 36pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">This letter shall serve to amend Secton 5b(ii) or your Employment Agreement, dated June&#160;8, 2009, with Network-1 Security Solutions, Inc. (&#8220;Network-1&#8221;) so that all references in Section 5(b)(ii) to Additional Bonus Compensation and Royalty Bonus Compensation payable to you from patents other than the Remote Power Patent shall be amended from 12.5% to 10%.&#160;&#160;In consideration of your agreement to reduce the aforementioned percentage the Board of Directors of Network-1 has authorized a payment of $250,000 to you.</font></div>

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<div style="TEXT-ALIGN: left; TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt"><font style="FONT-FAMILY: times new roman; FONT-SIZE: 10pt"><font style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt">Very truly yours,</font></font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Agreed and Accepted:</font></div>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: times new roman; FONT-SIZE: 10pt"><font style="DISPLAY: inline">/s/ Corey M. Horowitz </font></font>

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<div style="TEXT-INDENT: 0pt; DISPLAY: block; MARGIN-LEFT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-FAMILY: Times New Roman; FONT-SIZE: 10pt">Corey M. Horowitz</font></div>
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