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Filed Pursuant to Rule 424(b)(3)
Registration Statement No. 333-52252
PROSPECTUS
[BROADBASE LOGO]
BROADBASE SOFTWARE, INC.
475,361 Shares of Common Stock
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Broadbase Software, Inc. common stock trades on the Nasdaq National Market.
Last reported sale price on January 12, 2001: $7.13 per share.
Trading Symbol: BBSW
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THE OFFERING
With this prospectus, the selling stockholders named in the section
entitled "Selling Stockholders" of this prospectus may offer and sell shares of
our common stock that they acquired upon our acquisition of Decisionism, Inc.
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INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. PLEASE
CAREFULLY CONSIDER THE "RISK FACTORS" BEGINNING ON PAGE 4 OF THIS PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this prospectus is January 12, 2001.
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TABLE OF CONTENTS
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Forward-Looking Statements............ 2
Prospectus Summary.................... 3
Risk Factors.......................... 4
Use of Proceeds....................... 15
Selling Stockholders.................. 15
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Plan of Distribution.................. 16
Legal Matters......................... 17
Experts............................... 18
Where You Can Find More Information... 18
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Unless the context otherwise requires, the terms "we," "us," "our" and
Broadbase refer to Broadbase Software, Inc., a Delaware corporation, and its
wholly-owned subsidiaries. Broadbase, Aperio, Decisionism, eMA, Panopticon,
Rubric and Servicesoft are our trademarks and are registered in certain
jurisdictions. Other trademarks and tradenames appearing in this prospectus are
the property of their respective holders.
FORWARD-LOOKING STATEMENTS
We make many statements in this prospectus under the captions "Prospectus
Summary," "Risk Factors" and elsewhere that are forward-looking statements
within the meaning of Section 27A of the Securities Act and Section 21E of the
Exchange Act. These statements relate to our future plans, objectives,
expectations and intentions. We may identify these statements by the use of
words such as "believe," "expect," "anticipate," "intend" and "plan" and similar
expressions. These forward-looking statements involve risks and uncertainties.
Our actual results could differ materially from those anticipated in these
forward-looking statements as a result of various factors, including those we
discuss in "Risk Factors" and elsewhere in this prospectus. These
forward-looking statements speak only as of the date of this prospectus, or in
the case of documents incorporated by reference, as of the date of each
document, and we caution you not to rely on these statements without also
considering the risks and uncertainties associated with these statements and our
business.
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PROSPECTUS SUMMARY
This summary highlights information contained elsewhere in this prospectus.
This summary is not complete and does not contain all of the information you
should consider before buying shares in this offering. You should read the
entire prospectus and documents incorporated by reference carefully.
SUMMARY OF BROADBASE'S BUSINESS
We develop and market customer-focused analytic, marketing automation and
e-service software applications. Our software integrates information from
numerous points of customer interaction by pulling information from multiple
data sources and transforming it into a standard format, and analyzes this
reformatted information to provide a comprehensive understanding of the customer
life cycle from initial identification through acquisition and retention. Our
products then allow businesses to translate this analysis into specific actions
such as targeting profitable customers, personalizing customer interactions and
identifying opportunities to sell complementary or higher-end products and
services. In addition, our eMA (eMarketing Automation) application enables
businesses to act on this analysis through automated marketing campaigns over
the Internet and traditional channels. By integrating, analyzing and acting on
valuable customer information, our products enable businesses to build
long-lasting and profitable customer relationships.
We were incorporated in California under the name "Broadbase Information
Systems, Inc., and reincorporated in Delaware in September 1999 under our
current name. Our principal executive offices are located at 181 Constitution
Drive, Menlo Park, California. Our telephone number is (650) 614-8300.
THE OFFERING
Of the shares that may be offered with this prospectus, all are held by
former stockholders of Decisionism, Inc. These shares are being offered on a
continuous basis under Rule 415 of the Securities Act.
Common stock that may be offered by the
selling stockholders........................ 475,361 shares
Common stock to be outstanding after this
offering.................................... 80,900,327 shares*
Use of proceeds............................. We will not receive any
proceeds.
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* Based on the number of shares outstanding as of December 18, 2000.
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RISK FACTORS
You should carefully consider the risks described below before making an
investment decision. The risks described below are not the only ones facing our
company. Additional risks not presently known to us, or that we currently deem
immaterial, may become important factors that impair our business operations.
Our business, financial condition or results of operations could be seriously
harmed by any of these risks. The trading price of our common stock could
decline due to any of these risks, and you may lose all or part of your
investment.
RISKS RELATED TO OUR BUSINESS
WE HAVE INCURRED LOSSES SINCE OUR INCEPTION, AND WE EXPECT TO INCUR LOSSES FOR
THE FORESEEABLE FUTURE.
We incurred net losses and losses from operations for each period from our
inception through the first nine months of 2000. As of September 30, 2000, we
had accumulated net losses of approximately $147.2 million. Servicesoft, Inc.,
which we acquired in December 2000, had accumulated net losses of approximately
$89.8 million as of June 30, 2000. We have not achieved profitability to date,
and we expect to continue to incur substantial losses for the foreseeable
future. Although our revenues and Servicesoft's revenues grew significantly in
1999 and during the first nine months of 2000, our growth may not continue at
the current rate or at all. We expect to incur increasing sales and marketing,
research and development and general and administrative expenses. As a result,
we will need to significantly increase our revenue to achieve profitability.
Even if we do achieve profitability, we may not be able to sustain or increase
profitability on a quarterly or annual basis in the future.
OUR BUSINESS IS DIFFICULT TO EVALUATE BECAUSE OUR OPERATING HISTORY IS LIMITED.
Because we are still in the early stages of our development, we will be
subject to the risks, expenses and uncertainties frequently encountered by a
young company. For example, because we introduced a number of our products in
May 1999, and our Servicesoft 2001 family of products in the third quarter of
2000, it is difficult to predict whether our products will continue to be
accepted by the market, which is evolving rapidly, and the level of revenues we
can expect to derive from sales of our products. Furthermore, several members of
our management team have been with us for only a short period of time. Because
of our limited operating history and evolving product offerings, our insights
into trends that may emerge and affect our business are limited.
WE EXPECT OUR QUARTERLY REVENUES AND OPERATING RESULTS TO FLUCTUATE.
Our revenues and operating results are likely to vary significantly from
quarter to quarter. The factors that affect our quarterly operating results
include:
- changes in our pricing policies, or changes in the pricing policies of
our competitors;
- the size and timing of customer orders for our products and our
professional services;
- the demand for our products, particularly our e-business applications;
- uncertainty regarding the timing of the implementation cycle for our
products;
- increased expenses for sales and marketing, product development and
administration;
- changes in the level of sales of professional services as compared to
product licenses;
- the timing of the introduction of new product and services by us or our
competitors, which could affect the demand for our existing products and
services;
- the purchasing and budgeting cycles of our customers, which could result
in seasonality;
- costs incurred with respect to acquisitions of technology or businesses;
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- changes in the mix of our domestic and international sales; and
- changes in general economic and market conditions.
Our quarterly revenues increased 418% from the third quarter of 1999 to the
third quarter of 2000, and Servicesoft's revenues increased 405% from the second
quarter of 1999 to the second quarter of 2000. We do not believe that these
rates of growth are indicative of the growth in revenues, if any, that we can
expect in the future. Accordingly, we believe that period-to-period comparisons
of our operating results may not be meaningful and you should not rely on these
comparisons as an indication of our future performance. Our operating results
may fall below the expectations of investors. In this event, the market price of
our common stock would likely decrease.
THE UNPREDICTABLE TIMING OF OUR SALES AND IMPLEMENTATION CYCLE MAKES IT
DIFFICULT TO FORECAST OUR OPERATING RESULTS.
Our products can have a long and unpredictable sales cycle. Potential
customers often require time to weigh the costs and benefits of our products
compared to those of in-house development and integration efforts. As a result,
our sales cycle for our products has typically ranged from two to seven months,
although it can take longer. Consequently, we face difficulty predicting the
quarter in which sales to expected customers will occur. This contributes to the
uncertainty of our future operating results.
Delays and uncertainty in product and service implementations can compound
the difficulty of forecasting our operating results. In most customer sales, we
are involved in the installation of our software products at the customer site,
and we recognize revenue from a customer sale based in part on when the
installation is complete. However, the timing of the commencement and completion
of the installation process is subject to factors that may be beyond our
control, as this process requires access to the customer's facilities and
coordination with the customer's personnel after delivery of the software. In
addition, customers may elect to delay product implementations. These factors
make it difficult to forecast operating results and can result in significant
variability in period-to-period results.
OUR OPERATING EXPENSES ARE INCREASING, AND IF WE FAIL TO MEET OUR REVENUE
FORECASTS, WE WILL NOT BE ABLE TO REDUCE THESE EXPENSES QUICKLY.
We plan to significantly increase our operating expenses as we expand our
sales, marketing, research and development, professional services, customer
support and administrative groups. These expenses will be incurred before we
generate any revenues from our increased spending. If we do not significantly
increase revenues as a result of these efforts, we will not achieve
profitability. Our operating expenses are based on our expectations of future
revenues and are relatively fixed in the short term. As a result, we would not
be able to reduce spending quickly if our revenue was lower than we had
projected. Therefore, if our revenue falls below our expectations in any
quarter, or if we increase our spending ahead of our revenue growth, our
operating results will be lower than expected.
IF OUR ACQUISITIONS ARE NOT PERCEIVED AS SUCCESSFUL, THIS MAY CAUSE A DECLINE IN
OUR STOCK PRICE.
We recently acquired several companies, including Servicesoft, Decisionism,
Inc., and Panopticon, Inc., and if we are presented with appropriate
opportunities, we may acquire additional companies or make investments in other
companies, products or technologies in the future. Many of these companies are
in the early stages of their development and have unproven business models. We
may not realize the anticipated benefits of these or other acquisitions or
investments to the extent that we anticipate, or at all. We may have to incur
debt or issue equity securities to pay for any additional future acquisitions or
investments, the issuance of which could be dilutive to our existing
stockholders. If these acquisitions are not perceived as accretive, our stock
price may decline.
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OUR ACQUISITIONS MAY RESULT IN DISRUPTIONS TO OUR BUSINESS DUE TO DIFFICULTIES
IN ASSIMILATING PERSONNEL, TECHNOLOGY AND OPERATIONS.
The integration of acquired companies into our own will be a complex, time
consuming and expensive process and may disrupt our business if not completed
efficiently or in a timely manner. We must demonstrate to customers and
suppliers that an acquisition will not result in adverse changes in client
service standards, or dilution of or distraction to our business focus. We may
not be able to successfully assimilate additional personnel, operations,
acquired technology or products into our business. In particular, we will need
to assimilate and retain key professional services, engineering and marketing
personnel. The difficulties of integrating other businesses could be greater
than we anticipate, and could disrupt our ongoing business, disrupt our
management and employees and increase our expenses.
ACCOUNTING CHARGES RELATING TO ACQUISITIONS WILL PREVENT US FROM ACHIEVING
POSITIVE NET INCOME UNDER GAAP AS QUICKLY AS WE MIGHT OTHERWISE.
We have accounted for our recent acquisitions using the purchase method of
accounting. Under the purchase method, the purchase price of the acquired
company is allocated based on an independent valuation, to the specific tangible
and intangible assets acquired and liabilities assumed. We expect to record
approximately $550.7 million in intangible assets and goodwill in connection
with our acquisition of Servicesoft, which would result in annual amortization
expense of approximately $112.3 million, and expect to record a charge to
operations of approximately $13.0 million for acquired in-process research and
development. This allocation is subject to change pending a final analysis of
the fair values of the assets acquired and liabilities assumed. We recorded
approximately $362.0 million of intangible assets and goodwill on our balance
sheet in connection with our acquisition of Rubric, which will result in annual
amortization expense of approximately $72 million through 2004 and $6.0 million
for 2005. We also recorded $28.8 million in intangible assets and goodwill in
connection with our acquisition of Aperio, and $88.0 million in intangible
assets and goodwill in connection with our acquisition of Panopticon. We will
likely record additional intangible assets and goodwill and merger related costs
in connection with potential future acquisitions. These charges will reduce our
net income reported under generally accepted accounting principles.
WE NEED TO ATTRACT, TRAIN AND RETAIN ADDITIONAL QUALIFIED PERSONNEL IN A
COMPETITIVE EMPLOYMENT MARKET.
Our success depends on our ability to attract, train and retain qualified,
experienced employees. There is substantial competition for experienced
management, engineering, sales and marketing personnel, particularly in the
market segment in which we compete. If we are unable to retain our existing key
personnel, or to attract, train and retain additional qualified personnel, we
may experience inadequate levels of staffing to develop and sell our products
and perform services for our customers.
The market price of our common stock has fluctuated substantially since our
initial public offering in September 1999, and has recently experienced a
significant decline. We have relied historically on our ability to attract
employees using equity incentives, and any perception by potential and existing
employees that our equity incentives are less attractive could harm our ability
to attract and retain qualified employees.
We believe that our success will depend on the continued services of our
executive officers. These employees serve "at-will" and may elect to pursue
other opportunities at any time. The loss of any of our executive officers could
harm our business. Several of our executive officers joined us only recently and
have had a limited time to work together. For example, five of our executive
officers commenced employment with us during 2000. We cannot assure you that our
new executive officers will be able to work effectively together to manage our
growth and continuing operations.
OUR GROWTH DEPENDS ON MARKET ACCEPTANCE OF OUR APPLICATIONS DESIGNED FOR
INTERNET-BASED SYSTEMS.
We first introduced our applications designed for Internet-based systems in
May 1999, and our Servicesoft 2001 family of products in the third quarter of
2000. We expect that our future growth will
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depend significantly on revenue from licenses of these applications and related
services. There are significant risks inherent in introducing these new
products. Market acceptance of these new products will depend on the growth of
the market for e-business solutions. This growth may not occur. We cannot assure
you that our new e-business applications will meet customer performance
expectations. If they do not meet customer expectations or the market for these
products fails to develop or develops more slowly than we expect, our business
would be harmed.
OUR BUSINESS WILL SUFFER IF WE ARE UNABLE TO SIGNIFICANTLY EXPAND OUR SALES
FORCE.
We sell our products primarily through our direct sales force. We must
significantly expand our direct sales operations to increase market awareness of
our products and increase revenue. We cannot be certain that we will be
successful in these efforts. Our products and services require sophisticated
sales efforts. As a result, our ability to increase our direct sales operation
will depend on our ability to recruit, train and retain top sales people with
advanced sales skills and technical knowledge. There is a shortage of sales
personnel with these qualifications, and competition for qualified personnel is
intense in our industry. If we are unable to hire or retain qualified sales
personnel, or if newly hired personnel fail to develop the necessary skills or
reach productivity more slowly than anticipated, our business could be harmed.
WE RELY ON MARKETING, TECHNOLOGY AND DISTRIBUTION RELATIONSHIPS THAT MAY
GENERALLY BE TERMINATED AT ANY TIME, AND IF OUR CURRENT AND FUTURE RELATIONSHIPS
ARE NOT SUCCESSFUL, OUR GROWTH MAY BE LIMITED.
We rely on marketing and technology relationships with a variety of
companies that, in part, generate leads for the sale of our products. These
marketing and technology relationships include relationships with:
- system integrators and consulting firms;
- vendors of e-commerce and Internet software;
- vendors of software designed for customer relationship management or for
management of organizations' operational information;
- vendors of key technology and platforms;
- demographic data providers; and
- an application service provider and an Internet hoster.
If we cannot maintain successful marketing and technology relationships or
cannot enter into additional marketing and technology relationships, we may have
difficulty expanding the sales of our products and our growth may be limited.
While these companies do not sell or distribute our products, we believe that
many of our direct sales are the result of leads generated by vendors of
e-business and enterprise applications that work with our products. Our
marketing and technology relationships are generally not documented in writing,
or are governed by agreements that can be terminated by either party with little
or no prior notice. In addition, companies with which we have marketing,
technology or distribution relationships may promote products of several
different companies. If these companies choose not to promote our products or if
they develop, market or recommend software applications that compete with our
products, our business will be harmed.
In addition, we have distribution relationships with companies located
around the world that distribute or resell our products. Sales through these
indirect sales channels accounted for approximately 28.7% of our total revenues
for 1998, 35.3% for 1999 and 13.3% for the first nine months of 2000. If we
cannot maintain successful relationships with our indirect sales channel
partners, we may have difficulty expanding the sales of our products and our
international growth may be limited.
In addition, we rely on distributors, value-added resellers, systems
integrators, consultants and other third-party resellers to recommend our
Servicesoft products and to install and support these products. If these
companies fail to implement our Servicesoft products successfully for our
customers, we may be unable to complete implementation on the schedule required
by the customers. We may not be able to
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maintain these relationships and enter into additional relationships that will
provide timely and cost-effective customer support and service.
WE MAY BE UNABLE TO ATTRACT NEW CUSTOMERS IF WE DO NOT DEVELOP NEW PRODUCTS AND
ENHANCEMENTS.
If we do not continue to improve our products and develop new products that
keep pace with competitive product introductions and technological developments,
satisfy diverse and rapidly evolving customer requirements and achieve market
acceptance, we may be unable to attract new customers. For example, we have
recently released new versions of a number of our existing analytic applications
and our Servicesoft 2001 family of software e-service products. We may not be
successful in marketing and supporting these new versions, or developing and
marketing other product enhancements and new products that respond to
technological advances and market changes, on a timely or cost-effective basis.
In addition, even if these products are developed and released, they may not
achieve market acceptance. We have in the past experienced delays in releasing
new products and product enhancements and may experience similar delays in the
future. These delays or problems in the installation or implementation of our
new releases may cause customers to forego purchases of our products.
WE DEPEND ON INCREASED BUSINESS FROM OUR NEW CLIENTS, AND IF WE FAIL TO GROW OUR
CLIENT BASE OR GENERATE REPEAT BUSINESS, OUR OPERATING RESULTS COULD BE HARMED.
If we fail to grow our client base or generate repeat and expanded business
from our current and future clients, our business and operating results will be
seriously harmed. Some of our clients initially make a limited purchase of our
products and services for pilot programs. These clients may not choose to
purchase additional licenses to expand their use of our products. These clients
have not yet developed or deployed initial applications based on our products.
If these clients do not successfully develop and deploy these initial
applications, they may choose not to purchase deployment licenses or additional
development licenses.
The effectiveness of our Servicesoft products depends in part on the
widespread adoption and use of these products by customer support personnel.
Some of our clients who have made initial purchases of this software have
deferred or suspended implementation of our products due to slower than expected
rates of internal adoption by customer support personnel. If more clients decide
to defer or suspend implementation of these products in the future, our ability
to increase our revenue from these clients through additional licenses or
maintenance agreements will also be impaired, and our financial position may be
seriously harmed. Our business model generally depends on the expanded use of
our products within our clients' organizations.
In addition, as we introduce new versions of our products or new products,
our current clients may not require the functionality of our new products and
may not ultimately license these products. Because the total amount of
maintenance and support fees we receive in any period depends in large part on
the size and number of licenses that we have previously sold, any downturn in
our software license revenue would negatively affect our future services
revenue. In addition, if clients elect not to renew their maintenance
agreements, our services revenue could decline significantly.
MARKET ACCEPTANCE OF OUR PRODUCTS MAY SUFFER IF WE ARE UNABLE TO KEEP PACE WITH
RAPID TECHNOLOGICAL CHANGES AND INDUSTRY STANDARDS.
Rapidly changing technology and operating system standards, changes in
customer requirements and evolving industry standards may impede market
acceptance of our products. Our new applications have been designed based upon
currently prevailing Internet technology. If new Internet technologies emerge
that are incompatible with our applications, or if competing products emerge
which are based on new technologies or new industry standards which perform
better or cost less than our products, our key products may become obsolete and
our existing and potential customers may seek alternatives to our products. We
may not be able to quickly adapt our products to any new Internet technology,
customer requirements or industry standards.
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We have designed our products to work with databases such as Oracle and
Microsoft SQL Server. Any changes to those databases, or increasing popularity
of other databases, could require us to modify our products, and could cause us
to delay releasing future products and enhancements. Furthermore, software
adapters are necessary to integrate our products with other systems and data
sources used by our customers. We must develop and update these adapters to
reflect changes to these systems and data sources in order to maintain the
functionality provided by our products. As a result, uncertainties related to
the timing and nature of new product announcements, introductions or
modifications by vendors of operating systems, databases, customer relationship
management software, web servers and other enterprise and Internet-based
applications could delay our product development, increase our product
development expense or cause customers to delay evaluation, purchase and
deployment of our products.
OUR BUSINESS DEPENDS ON THE ACCEPTANCE AND USE OF THE WINDOWS NT OPERATING
SYSTEM.
Both our analytic software products and our Servicesoft e-service software
products currently run only on the Windows NT operating system. Any change to
this operating system could require us to modify our products and could cause us
to delay product releases. Any decline in the market acceptance of the Windows
NT operating system for any reason, including as a result of errors or delayed
introduction of enhancement or upgrades, could seriously harm our business. If
potential customers do not want to use the Windows NT operating system, we will
need to develop products that run on other operating systems such as UNIX. The
development of new products in response to these risks would require us to
commit a substantial investment of resources, and we may not be able to
successfully develop or introduce such products on a timely or cost-effective
basis, or at all, which could lead potential customers to choose alternative
products.
FAILURE TO LICENSE NECESSARY THIRD PARTY SOFTWARE INCORPORATED IN OUR PRODUCTS
MAY CAUSE DELAYS OR REDUCTIONS IN OUR SALES.
We license third party software that we incorporate into our products.
These licenses may not continue to be available on commercially reasonable terms
or at all. Some of this technology would be difficult to replace. The loss of
any such license could result in delays or reductions of our applications until
equivalent software is identified, licensed and integrated or developed by us.
If we are required to enter into license agreements with third parties for
replacement technology, we could be subject to higher royalty payments and a
loss of product differentiation.
WE FACE INTENSE COMPETITION THAT COULD MAKE IT DIFFICULT TO ACQUIRE AND RETAIN
CUSTOMERS.
Our market is intensely competitive, and we expect competition to intensify
in the future. Recently, some of our competitors reduced the prices of their
products and services substantially in certain cases in order to obtain new
customers. Competitive pressures may make it difficult for us to acquire and
retain customers and may require us to reduce the price of our products. Failure
to maintain and enhance our competitive position could seriously harm our
business. Our customers' requirements and the technology available to satisfy
those requirements are continually changing. Therefore, we must be able to
respond to these changes in order to remain competitive.
Our competitors vary in size and in the scope and breadth of products and
services offered. We currently face competition from providers of
consulting-based analytic solutions, providers of e-service software products
similar to our Servicesoft products, vendors of point technologies that provide
website analysis, in-house development efforts by potential customers, and from
other software providers. We may also face competition from providers of
customer relationship management, e-commerce and communications solutions. In
addition, we face competition from vendors of other enterprise applications as
they expand the functionality of their product offerings, including companies
that design software for decision support, management of customer relationships
or of organizations operational information, as well as vendors of database
applications. In addition, we expect that competition may increase as a result
of software industry consolidations and formations of alliances among industry
participants or with third parties. For example, Kana Communications, Inc.
recently acquired Silknet Software, Inc., eGain
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Communications Corp. recently acquired Inference Corporation, Siebel Systems
Inc. recently acquired Onlink Technologies, Inc., and E.piphany, Inc. recently
acquired Octane Software, Inc. Finally, it is possible that new competitors may
emerge and acquire our market share.
Some of our current and potential competitors have longer operating
histories and significantly greater financial, technical, marketing and other
resources than we do, and thus may be able to respond more quickly to new or
changing opportunities, technologies and customer requirements. Also, many
current and potential competitors have wider name recognition and more extensive
customer bases that they could leverage, thereby gaining market share to our
detriment. They may be able to undertake more extensive promotional activities,
adopt more aggressive pricing strategies, and offer purchasers more attractive
terms than we can. Our competitors may develop products that are superior to
ours or that achieve greater market acceptance.
WE DEPEND ON OUR INTELLECTUAL PROPERTY, AND LITIGATION REGARDING OUR
INTELLECTUAL PROPERTY COULD HARM OUR BUSINESS.
The success of our business is largely dependent on our ability to protect
our intellectual property. Our intellectual property includes our proprietary
technology, trade secrets, trademarks and copyrights in our software products.
We have no patents, although patents may become increasingly important in
software and e-business applications. Unauthorized use or misappropriation of
our intellectual property could seriously harm our business. Copyrights and
trademarks discourage unauthorized use of our software and company and product
names and provide us with a way to enforce our rights in the event that this
unauthorized use occurs. Trade secret laws protect the confidentiality of our
propriety technology and other business information. However, existing
copyright, trademark and trade secret laws afford only limited protection, and
the laws of some foreign countries do not protect our proprietary rights to the
same extent as do the laws of the United States. Third parties may infringe upon
our intellectual property rights, and we may be unable to detect this
unauthorized use or effectively enforce our rights. In addition, any legal
action that we may bring to protect our intellectual property rights could be
expensive and distract management from day-to-day operations.
Our business activities may infringe upon the proprietary rights of others,
and other parties may assert infringement claims against us. If we become liable
to any other third party for infringing their intellectual property rights, we
could be required to pay substantial damage awards and to develop non-infringing
technology, obtain licenses or cease selling the applications that contain the
infringing intellectual property. We could have to redesign our products, which
could be costly and time-consuming and could substantially delay product
shipments, assuming that a redesign is even feasible. We may be unable to
develop non-infringing technology or obtain licenses on commercially reasonable
terms, if at all. Litigation is subject to inherent uncertainties and any of
these results in connection with a lawsuit could seriously harm our business.
Furthermore, we could incur substantial costs in defending against any
intellectual property litigation, and these costs could increase significantly
if any dispute were to go to trial. Our defense of any litigation, regardless of
the merits of the complaint, will likely be time-consuming, costly and a
distraction for our management personnel. Publicity related to any intellectual
property litigation could also harm the sale of our products and disrupt our
relationships with existing clients.
SOFTWARE DEFECTS COULD LEAD TO LOSS OF REVENUE OR DELAY IN MARKET ACCEPTANCE FOR
OUR PRODUCTS OR MAY EXPOSE US TO LIABILITY.
Our software products are internally complex and may contain defects,
especially when they are first introduced or when new versions are released. In
the past, we have discovered software errors in some of our products after their
introduction. We recently released new versions of a number of our analytic
software applications and our Servicesoft 2001 family of products. As a result,
these products may be particularly susceptible to errors. Although we continue
to evaluate our products for errors following the commencement of commercial
shipments and receive information from customers regarding errors they detect,
if we are not able to detect and correct errors in products or releases before
commencing
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commercial shipments, we may experience loss of or delay in revenues, loss of
market share or failure to achieve market acceptance for our products, diversion
of development resources or injury to our reputation.
We may encounter product liability claims in the future as a result of any
product defects. Our license agreements with our customers typically contain
provisions designed to limit our exposure to potential product liability claims.
However, all domestic and international jurisdictions may not enforce these
limitations. Product liability claims brought against us could divert the
attention of management and key personnel, could be expensive to defend and may
result in adverse settlements and judgments.
BARRIERS TO INTERNATIONAL EXPANSION COULD LIMIT OUR FUTURE GROWTH.
We have only a limited history of marketing, selling and supporting our
products and services internationally. We conduct our international sales
primarily through direct sales offices in Europe and Asia, through a Servicesoft
subsidiary in Canada and through distributors in Japan. International sales
represented approximately 5.1% of our total revenue for the year ended December
31, 1998, 23.2% for 1999 and 19.1% for the first nine months of 2000,
substantially all of which consisted of sales to customers in Canada, Europe and
Japan. International sales represented approximately 10.1% of Servicesoft's
total revenue for the year ended December 31, 1998, 24.9% for the year ended
1999 and 9.9% for the first six months of 2000. We intend to expand our
international operations, but we may face significant barriers to this
expansion. Our failure to manage our international operations effectively could
limit the future growth of our business. The expansion of our existing
international operations and entry into additional international markets will
require significant management attention and financial resources.
Our products must be localized, or customized to meet local user needs, in
order to be sold in particular foreign countries. Developing local versions of
our products for foreign markets is difficult and can take longer than we
anticipate. We currently have limited experience in localizing products and in
testing whether these localized products will be accepted in the targeted
countries. For example, we are currently marketing localized products only in
Germany and Japan. We cannot assure you that our localization efforts will be
successful.
We also face certain other risks inherent in conducting business
internationally, such as:
- difficulties and costs of staffing and managing international operations;
- difficulties in recruiting and training an international staff;
- difficulties in entering into strategic relationships with companies in
international markets, particularly in Japan where all of our sales have
been made through distributors;
- language and cultural differences;
- difficulties in collecting accounts receivable and longer collection
periods;
- seasonal business activity in certain parts of the world;
- fluctuations in currency exchange rates;
- legal and governmental regulatory requirements;
- tariffs, duties, price controls and other trade barriers; and
- potentially adverse tax consequences.
Any of these factors could seriously harm our international operations and,
consequently, our business.
To date, a majority of our international revenue and costs have been
denominated in foreign currencies. We have not engaged in any foreign exchange
hedging transactions to mitigate exchange rate risk. Accordingly, our results of
operations could be harmed by foreign currency exchange rate fluctuations.
11
<PAGE> 12
WE ARE GROWING RAPIDLY, AND THE FAILURE TO MANAGE OUR GROWTH, INCLUDING
EXPANSION OF OUR MANAGEMENT SYSTEMS, COULD HARM OUR BUSINESS.
We have grown rapidly and will need to continue to grow in all areas of
operation in order to execute our business strategy. Our total number of
full-time employees grew from 131 at December 31, 1999 to 320 at September 30,
2000. Servicesoft's total number of full-time employees grew from 243 at
December 31, 1999 to 312 at September 30, 2000. We anticipate further
significant increases in the number of our employees. Our growth has placed
significant demands on management as well as on our administrative, operational
and financial resources and controls. We expect our future growth to cause
similar, and perhaps increased, strain on our systems and controls. If we cannot
effectively establish and improve our processes, we may not be able to manage
our growth successfully or sustain and manage the growth rates we have
experienced in the past.
We recently completed the implementation of several new operational
information systems, and began an extensive upgrade of our finance, accounting,
and product distribution systems. In addition, we plan to deploy certain of
these systems in our international operations during the first quarter of 2001.
Failure to successfully complete these systems implementations, upgrades, and
deployments in a timely and effective manner may result in the disruption of our
operations, which could adversely affect our operating results.
OUR PROSPECTS FOR OBTAINING ADDITIONAL FINANCING, IF REQUIRED, ARE UNCERTAIN AND
FAILURE TO OBTAIN NEEDED FINANCING COULD AFFECT OUR ABILITY TO PURSUE FUTURE
GROWTH.
We expect that our cash on hand, cash equivalents and proceeds from our
initial and secondary public offerings will be sufficient to meet our working
capital and capital expenditure needs for the foreseeable future. However, we
may need to raise additional funds to fund expansion, to respond to competitive
pressures or to acquire complementary products, businesses or technologies. We
cannot assure you that we would be able to obtain additional financing on
favorable terms, if at all. If we issue additional equity securities,
stockholders may experience additional dilution or the new equity securities may
have rights, preferences or privileges senior to those of existing holders of
common stock. If we cannot raise necessary additional funds on acceptable terms,
we may not be able to fund expansion, take advantage of future opportunities or
respond to competitive pressures or unanticipated requirements.
OUR STOCK PRICE MAY BE VOLATILE, WHICH COULD LEAD TO LOSSES BY INVESTORS AND TO
SECURITIES LITIGATION.
The market price of our common stock has been and is likely to continue to
be highly volatile due to several factors, such as:
- variations in our actual and anticipated operating results;
- changes in our earnings estimates by analysts;
- our failure to meet analysts' performance expectations; and
- the volume of trading in our common stock.
In addition, stock markets, particularly the Nasdaq National Market, have
experienced extreme price and volume fluctuations, and in particular the market
prices of securities of technology companies, especially Internet-related
companies, have declined significantly in recent months. Some of these declines
have been unrelated to the operating performance of such companies. The trading
price of our common stock has likewise experienced a significant decline in
recent months, and fluctuations or declines such as these may continue to affect
the market price of our common stock in the future. Substantial sales of our
common stock could also cause the stock price to decline.
In the past, securities class action litigation has often been instituted
against companies following periods of volatility in their stock price. This
type of litigation could result in substantial costs and could divert our
management's attention and resources.
12
<PAGE> 13
ADDITIONAL RISKS RELATED TO OUR RECENT ACQUISITION OF SERVICESOFT
IF WE DO NOT SUCCESSFULLY INTEGRATE THE OPERATIONS AND PERSONNEL OF SERVICESOFT
IN A TIMELY MANNER, THIS WILL DISRUPT OUR BUSINESS AND COULD NEGATIVELY AFFECT
OUR OPERATING RESULTS.
The integration of Servicesoft into our business will be a complex, time
consuming and expensive process and may disrupt our business if not completed in
a timely and efficient manner. We must operate as a combined organization
utilizing common information and communication systems, operating procedures,
financial controls and human resources practices. We may encounter substantial
difficulties, costs and delays involved in integrating Servicesoft's operations
into our own, including:
- potential incompatibility of business cultures;
- perceived adverse changes in business focus;
- potential conflicts in distribution, marketing or other important
relationships; and
- the loss of key employees and diversion of the attention of management
from other ongoing business concerns.
Our integration of Servicesoft's operations and personnel may be
particularly difficult due to the location of Servicesoft's headquarters in
Natick, Massachusetts. There are currently no plans to relocate or consolidate
our Menlo Park headquarters or our Servicesoft headquarters. Failure to complete
the integration successfully could result in the loss of key personnel and
customers. We will need to devote significant resources to the integration of
the acquired operations and personnel, and if unsuccessful, our business will
suffer. In addition, the attention and effort devoted to the integration of
Servicesoft will significantly divert our management's attention from other
important issues, which could negatively affect our business and operating
results.
IF WE DO NOT INTEGRATE OUR PRODUCTS AND TECHNOLOGIES QUICKLY AND EFFECTIVELY,
MANY OF THE POTENTIAL BENEFITS OF THE MERGER MAY NOT BE REALIZED.
We will need to integrate Servicesoft's product development operations,
products and technologies with our own. This integration may be difficult and
unpredictable because our analytic and Servicesoft products are highly complex
and were developed independently and without regard to this integration.
Successful integration of Servicesoft's product development operations and
product lines with our own also requires coordination of different development
and engineering teams, as well as sales and marketing efforts and personnel.
This, too, may be difficult and unpredictable because of possible differences
between our corporate cultures and organizations, different product and
technology decisions and the geographic distance between our headquarters. In
addition, this integration may take longer than expected, and we may be required
to expend more resources on integration than anticipated. The need to expend
additional resources on integration would reduce the resources that would
otherwise be spent on developing each companies' own products and technologies.
If we cannot successfully integrate Servicesoft's operations, products and
technologies with our own, or if this integration takes longer than anticipated,
the combined company may not be able to operate efficiently or realize the
expected benefits of the merger.
IN ORDER TO ACHIEVE THE ANTICIPATED BENEFITS OF THE MERGER, WE WILL NEED TO
SUCCESSFULLY DEVELOP AND INTRODUCE NEW AND ENHANCED PRODUCTS.
We expect to develop and introduce new products, and enhanced versions of
our currently existing analytic and Servicesoft products, that interoperate as a
single platform. In addition to the risks and uncertainties inherent in the
development and introduction of new products, the need to develop and introduce,
in a timely manner, new products and versions that work effectively together and
allow customers to achieve the benefits of a broader product offering presents
significant additional obstacles. In particular, because our market is
characterized by rapidly shifting customer requirements, we may not be able to
assess these requirements accurately, or our joint products may not sufficiently
satisfy these requirements. In addition, the introduction of these anticipated
new products and versions may result in
13
<PAGE> 14
longer sales cycles and product implementations, which may cause revenue and
operating income to fluctuate and fail to meet expectations.
To date, we have not thoroughly investigated the obstacles, technological,
market-driven or otherwise, to developing and marketing these new products and
services in a timely and efficient way. We may not be able to overcome these
obstacles, or market acceptance of new products and services developed by us may
not meet expectations.
OUR PARTNERS AND CUSTOMERS MAY REACT UNFAVORABLY TO THE MERGER.
We have entered into relationships with other technology companies,
including software and services firms, to deliver our products to customers.
Some of these other companies may feel that the combination of Broadbase and
Servicesoft poses new competitive threats to their businesses and as a result
may terminate their relationships with us, or reduce their level of activity on
our behalf. In addition, we will need to educate our indirect sales channels
regarding Servicesoft's products and services, and these indirect channels may
not market these products and services effectively or at all.
The merger may also have the effect of disrupting customer relationships.
Our customers may not continue their current buying patterns. Customers may
defer purchasing decisions as they evaluate the likelihood of successful
integration of Servicesoft's products and services with our own, and our future
product and service strategy. Also, because of the broader product and service
offering that we will now offer as a result of the merger, some of our customers
may view us as more of a direct competitor than either Broadbase or Servicesoft
as an independent company, and may therefore cancel or fail to place additional
orders. Any significant delay or reduction in orders for our products could have
a material, negative impact on our operating results.
IF WE ARE NOT ABLE TO SUCCESSFULLY CROSS-SELL OUR PRODUCTS AND SERVICES TO
BROADBASE AND SERVICESOFT CUSTOMERS, THIS MAY NEGATIVELY AFFECT OUR OPERATING
RESULTS.
We intend to offer our current products to Servicesoft customers, and
Servicesoft's current products to existing customers of Broadbase products.
There can be no assurance that either company's customers will have an interest
in the other company's products and services. The failure of cross-marketing
efforts would diminish our ability to achieve one of the benefits that we expect
to realize as a result of the merger, and could have a material, negative impact
on our business, financial condition and operating results.
FAILURE TO RETAIN KEY EMPLOYEES COULD DIMINISH THE ANTICIPATED BENEFITS OF THE
MERGER.
The success of the merger will depend in part on the retention of personnel
critical to the business and operations of the combined company due to, for
example, their technical skills or management expertise. Employees may
experience uncertainty about their future role with us until our strategies with
regards to Servicesoft's employees are announced or executed. We have different
corporate cultures, and Servicesoft employees may not want to work for a larger,
publicly-traded company instead of a smaller, start-up company. Some officers,
including the Chief Executive Officer and President, and all directors of
Servicesoft have agreements that provide for benefits, including severance and
other payments and acceleration of vesting of stock options or restricted stock
grants, that were triggered upon the closing of the merger, and this may affect
our ability to retain these employees. In addition, competitors may recruit
employees during our integration of Servicesoft, as is common in high technology
mergers. If we are unable to retain personnel that are critical to the
successful integration of Servicesoft with our company, we could face
disruptions to our operations, loss of key information, expertise or know-how
and unanticipated additional recruitment and training costs. In addition, the
loss of key personnel could diminish the anticipated benefits of the merger.
14
<PAGE> 15
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock by the
selling stockholders under this prospectus.
SELLING STOCKHOLDERS
The following table presents information with respect to the selling
stockholders and the shares of our common stock that they may offer with this
prospectus. Each of the selling stockholders named below was formerly a
stockholder of Decisionism, Inc. and acquired their shares as a result of our
acquisition of that company. To our knowledge, none of the selling stockholders
has, or within the past three years has had, any position, office or other
material relationship with us or any of our affiliates.
The share information provided in the table below is based on information
provided to us about the selling stockholders as of December 18, 2000. We
calculated beneficial ownership according to Rule 13d-3 of the Exchange Act as
of this date. Each selling stockholder owns less than 1% of our outstanding
common stock, based on 80,900,327 shares of our common stock outstanding as of
December 18, 2000.
Subject to the terms of our merger agreement with Decisionism, Inc., we
will hold in escrow 45,145 shares that are beneficially owned by the selling
stockholders, or 10% of the shares issued to each Decisionism stockholder in the
acquisition, until December 15, 2001, as collateral for indemnification
obligations set forth in that agreement. Subject to limited exceptions, these
shares may not be sold or transferred without our consent.
The selling stockholders may from time to time offer and sell any or all of
their shares as listed below. Because the selling stockholders are not obligated
to sell their shares, and because they may also acquire publicly traded shares
of our common stock, we cannot estimate how many shares each selling stockholder
will beneficially own after this offering. We may update, amend or supplement
this prospectus from time to time to update the disclosure in this section.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY SHARES THAT MAY
OWNED BEFORE BE OFFERED
NAME THE OFFERING AND SOLD
---- ------------------- ---------------
<S> <C> <C>
FORMER STOCKHOLDERS OF DECISIONISM:
Charles River Partnership VII........................ 132,925 132,925
Sevin Rosen(1)....................................... 106,339 106,339
Rho Management Trust I............................... 100,821 100,821
The Hill Partnership III............................. 48,775 48,775
Norwest Equity Partners IV........................... 45,904 45,904
Fletcher Spaght, Inc................................. 23,870 23,870
Trinity Ventures(2).................................. 11,407 11,407
Juan Rodriguez....................................... 3,898 3,898
Donald J. Devine..................................... 1,422 1,422
------- -------
Totals............................................. 475,361 475,361
======= =======
</TABLE>
-------------------------
(1) Represents 101,980 shares held by Sevin Rosen Fund V L.P., and 4,359 shares
held by Sevin Rosen Affiliates Fund L.P.
(2) Represents 10,765 shares held by Trinity Ventures IV, L.P., and 642 shares
held by Trinity Side by Side Fund, L.P.
15
<PAGE> 16
PLAN OF DISTRIBUTION
The selling stockholders will be offering and selling all shares offered
and sold with this prospectus. We will not receive any of the proceeds of the
sales of these shares. Offers and sales of shares made with this prospectus must
comply with the terms of the merger agreement we entered into with Decisionism.
For example, each former Decisionism stockholder intending to sell shares with
this prospectus must first submit to us a notice of resale, and may only sell
shares with this prospectus during the fifteen trading days following our
written affirmative response to this notice.
Who may sell and applicable restrictions. The selling stockholders, as well
as their donees, pledgees, transferees and successors, may offer and sell shares
with this prospectus directly to purchasers. The selling stockholders could
transfer, devise or gift shares by other means. Selling stockholders may also
resell all or a portion of their shares in open market transactions in reliance
upon available exemptions under the Securities Act, such as Rule 144, provided
they meet the criteria and conform to the requirements of one of these
exemptions.
Alternatively, the selling stockholders may from time to time offer shares
through brokers, dealers or agents. Brokers, dealers, agents or underwriters
participating in transactions may receive compensation in the form of discounts,
concessions or commissions from the selling stockholders (and, if they act as
agent for the purchaser of the shares, from that purchaser). The discounts,
concessions or commissions might be in excess of those customary in the type of
transaction involved. In order to comply with certain states' securities laws,
if applicable, the shares will be sold in jurisdictions only through registered
or licensed brokers or dealers.
The selling stockholders and any brokers, dealers or agents who participate
in the distribution of the shares may be deemed to be underwriters, and any
profits on the sale of shares by them and any discounts, commissions or
concessions received by any broker, dealer or agent might be deemed to be
underwriting discounts and commissions under the Securities Act. To the extent
the selling stockholders may be deemed to be underwriters, the selling
stockholders may be subject to statutory liabilities, including, but not limited
to, Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under the
Exchange Act.
In addition, some of the selling stockholders are venture capital funds,
corporations or trusts which may, in the future, distribute their shares to
their partners, stockholders or trust beneficiaries, respectively, which
distributees may likewise distribute further such shares. Distributed shares may
later be offered and sold with this prospectus by such partners, stockholders or
trust beneficiaries, or by any of their respective distributees.
Prospectus delivery. Because selling stockholders may be deemed to be
underwriters within the meaning of Section 2(11) of the Securities Act, they
will be subject to the prospectus delivery requirements of the Securities Act. A
prospectus supplement or a post-effective amendment will be filed with the
Securities and Exchange Commission to reflect the disclosure of additional
information with respect to the distribution of the shares. In particular, if we
receive notice from a selling stockholder that a donee, pledgee, transferee or
successor intends to sell more than 500 shares of common stock, then to the
extent required we will file a supplement to this prospectus.
Manner of sales. The selling stockholders will act independently of the
company in making decisions with respect to the timing, manner and size of each
sale. Sales may be made over the Nasdaq National Market or the over-the-counter
market. The shares may be sold at then prevailing market prices, at prices
related to prevailing market prices, at fixed prices or at other negotiated
prices.
The shares may be sold according to one or more of the following methods:
- a block trade in which the broker or dealer so engaged will attempt to
sell the shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction;
- purchases by a broker or dealer as principal and resale by the broker or
dealer for its account as allowed under this prospectus;
16
<PAGE> 17
- ordinary brokerage transactions and transactions in which the broker
solicits purchasers;
- pledges of shares to a broker-dealer or other person, who may, in the
event of default, purchase or sell the pledged shares;
- an exchange distribution under the rules of the exchange;
- face-to-face transactions between sellers and purchasers without a
broker-dealer; and
- by writing options.
Hedging Transactions. In addition, selling stockholders may enter into
option, derivative or hedging transactions with respect to the shares, and any
related offers or sales of shares may be made under this prospectus. For
example, the selling stockholders may:
- enter into transactions involving short sales of the shares by
broker-dealers in the course of hedging the positions they assume with
selling stockholders;
- sell shares short themselves and deliver the shares registered hereby to
settle such short sales or to close out stock loans incurred in
connection with their short positions;
- write call options, put options or other derivative instruments
(including exchange-traded options or privately negotiated options) with
respect to the shares, or which they settle through delivery of the
shares;
- enter into option transactions or other types of transactions that
require the selling stockholder to deliver shares to a broker, dealer or
other financial institution, who may then resell or transfer the shares
under this prospectus; or
- loan the shares to a broker, dealer or other financial institution, who
may sell the loaned shares.
These option, derivative and hedging transactions may require the delivery to a
broker, dealer or other financial institution of shares offered under this
prospectus, and that broker, dealer or other financial institution may resell
those shares under this prospectus.
Expenses associated with registration. We have agreed to pay the expenses
of registering the shares under the Securities Act, including registration and
filing fees, printing and duplication expenses, administrative expenses, legal
fees and accounting fees. If the shares are sold through underwriters or
broker-dealers, the selling stockholders will be responsible for underwriting
discounts, underwriting commissions and agent commissions.
Indemnification and contribution. In the merger agreement, we and the
selling stockholders have agreed to indemnify or provide contribution to each
other and specified other persons against some liabilities in connection with
the offering of the shares, including liabilities arising under the Securities
Act. The selling stockholders may also agree to indemnify any broker-dealer or
agent that participates in transactions involving sales of the shares against
some liabilities, including liabilities arising under the Securities Act.
Suspension of this offering. We may suspend the use of this prospectus if
we learn of any event that causes this prospectus to include an untrue statement
of material fact or omit to state a material fact required to be stated in the
prospectus or necessary to make the statements in the prospectus not misleading
in light of the circumstances then existing. If this type of event occurs, a
prospectus supplement or post-effective amendment, if required, will be
distributed to each selling stockholder.
LEGAL MATTERS
Fenwick & West LLP, Palo Alto, California, will provide us with a legal
opinion as to the validity of the issuance of the shares of common stock offered
with this prospectus. Certain partners and investment partnerships comprised of
certain partners of Fenwick & West LLP own no more than 64,758 shares of our
common stock.
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<PAGE> 18
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedule included in our annual report on Form 10-K for
the year ended December 31, 1999, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in the registration
statement. Our consolidated financial statements and schedule are incorporated
by reference in reliance on Ernst & Young LLP's report, given on their authority
as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We incorporate into this prospectus by reference the following documents:
- our annual report on Form 10-K for the year ended December 31, 1999;
- all other reports filed by us under Section 13(a) or 15(d) of the
Exchange Act since December 31, 1999, including: (1) our quarterly
reports on Form 10-Q for the quarters ended March 31, 2000, June 30, 2000
and September 30, 2000; and (2) our current reports on Form 8-K filed on
February 11, 2000, September 26, 2000 (as amended on November 3, 2000),
November 17, 2000 and December 22, 2000;
- the description of our common stock contained in our registration
statement on Form 8-A (File No. 000-26789) filed with the Securities and
Exchange Commission on July 22, 1999; and
- all other information that we file with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of
this prospectus and before the termination of this offering.
To the extent that any statement in this prospectus is inconsistent with
any statement that is incorporated by reference, the statement in this
prospectus shall control. Such inconsistent incorporated statement shall not be
deemed, except as modified or superceded, to constitute a part of this
prospectus or the registration statement.
Because we are subject to the informational requirements of the Exchange
Act, we file reports and other information with the Commission. You may obtain
copies of this material from the Public Reference Room of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549 at rates prescribed by the
Commission. The public may obtain information on the operation of the Public
Reference Room by calling the Commission at 1-800-SEC-0330. Reports, proxy and
information statements and other information that we file electronically with
the Commission are available at the Commission's web site at http://www.sec.gov.
We have filed with the Commission a registration statement on Form S-3
under the Securities Act with respect to the common stock offered with this
prospectus. This prospectus does not contain all of the information in the
registration statement, parts of which we have omitted, as allowed under the
rules and regulations of the Commission. You should refer to the registration
statement for further information with respect to us and our common stock.
Statements contained in this prospectus as to the contents of any contract or
other document are not necessarily complete and, in each instance, we refer you
to the copy of each contract or document filed as an exhibit to the registration
statement.
We will furnish without charge to each person to whom a copy of this
prospectus is delivered, upon written or oral request, a copy of the information
that has been incorporated into this prospectus by reference (except exhibits,
unless they are specifically incorporated by reference into this prospectus).
You should direct any requests for copies to Broadbase Software, Inc., 181
Constitution Drive, Menlo Park, California 94025, Attention: General Counsel,
telephone: (650) 614-8300.
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<PAGE> 19
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[BROADBASE LOGO]
BROADBASE SOFTWARE, INC.
475,361 Shares of
Common Stock
-------------------------
PROSPECTUS
JANUARY 12, 2001
-------------------------
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE INTO THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU
WITH DIFFERENT INFORMATION. THE SELLING STOCKHOLDERS ARE OFFERING TO SELL, AND
SEEKING OFFERS TO BUY, SHARES OF COMMON STOCK ONLY IN JURISDICTIONS WHERE OFFERS
AND SALES ARE PERMITTED. THE INFORMATION CONTAINED IN THIS PROSPECTUS IS
ACCURATE ONLY AS OF THE DATE OF THIS PROSPECTUS, REGARDLESS OF THE TIME OF
DELIVERY OF THIS PROSPECTUS OR OF ANY SALE OF COMMON STOCK.
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