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| FORM 3 | U.S. SECURITIES AND EXCHANGE COMMISSION
+--------+ WASHINGTON, D.C. 20549
INITIAL STATEMENT OF BENEFICIAL OWNERSHIP OF SECURITIES
Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934,
Section 17(a) of the Public Utility Holding Company Act of 1935 or
Section 30(f) of the Investment Company Act of 1940
(Print or Type Responses)
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1. Name and Address of Reporting Person*
Sterling Software, Inc.
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(Last) (First) (Middle)
300 Crescent Court, Suite 1200
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(Street)
Dallas TX 75201
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(City) (State) (Zip)
2. Date of Event Requiring Statement (Month/Day/Year) 08/27/98
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3. IRS or Social Security Number of Reporting Person
(Voluntary)
4. Issuer Name and Ticker or Trading Symbol Cayenne Software, Inc. (CAYN)
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5. Relationship of Reporting Person(s) to Issuer (Check all applicable)
[ ] Director [ ] Officer [X] 10% Owner [ ] Other
(give title below) (specify below)
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6. If Amendment, Date of Original (Month/Day/Year)
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7. Individual or Joint Group Filing (Check Applicable Line)
X Form Filed by One Reporting Person
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Form filed by More than One Reporting Person
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TABLE I--NON-DERIVATIVE SECURITIES BENEFICIALLY OWNED
<TABLE>
<CAPTION>
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1. Title 2. Amount of 3. Ownership Form: 4. Nature of
of Securities Bene- Direct (D) or Indirect Bene-
Security ficially Owned Indirect (I) ficial Ownership
(Instr. 4) (Instr. 4) (Instr. 5) (Instr. 5)
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<S> <C> <C> <C>
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</TABLE>
*If the form is filed by more than one reporting (Over)
person see Instruction 5(b)(v). SEC 1473 (7/96)
Reminder: Report on a separate line for each
class of securities beneficially owned directly
or indirectly.
(Print or type response)
Page 1 of 2 pages
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FORM 3 (CONTINUED)
TABLE II--DERIVATIVE SECURITIES BENEFICIALLY OWNED
(E.G., PUTS, CALLS, WARRANTS, OPTIONS, CONVERTIBLE SECURITIES)
<TABLE>
<CAPTION>
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1. TITLE OF DERIVATIVE 2. DATE EXER- 3. TITLE AND AMOUNT OF SECURITIES 4. CONVERSION 5. OWNERSHIP 6. NATURE OF IN-
SECURITY (INSTR. 4) CISABLE AND UNDERLYING DERIVATIVE SECURITY OR FORM OF DIRECT BENE-
EXPIRATION (INSTR. 4) EXERCISE DERIVATIVE FICIAL
DATE PRICE SECURITY: OWNERSHIP
(MONTH/DAY/ OF DIRECT (D) (INSTR. 5)
YEAR) DERIVATIVE OR IN-
---------------------------------------------------- SECURITY DIRECT (I)
DATE EXPIRA- AMOUNT OR (INSTR. 5)
EXER- TION TITLE NUMBER OF
CISABLE DATE SHARES
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<S> <C> <C> <C> <C> <C> <C> <C>
Stock Option (Right to Buy) (1) (1) Common Stock (1) (1) D N/A
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Stock Option (Right to Buy) (2) (2) Common Stock (1) (1) D N/A
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</TABLE>
EXPLANATION OF RESPONSES:
(1) Pursuant to a Stockholder Agreement, dated as of August 27, 1998 (the
"Stockholder Agreement"), among the Reporting Person and the holders (the
"Preferred Stockholders") of all of the outstanding shares of Series D
Convertible Preferred Stock of the Issuer (the "Preferred Stock"), each of
the Preferred Stockholders granted the Reporting Person an option to
purchase all shares of capital stock of the Issuer owned by such Preferred
Stockholder. As of the date of the Stockholder Agreement, such options, in
the aggregate, entitled the Reporting Person to purchase (i) 446,664 shares
of Common Stock of the Issuer ("Common Stock") at an exercise price of
$0.375 per share (subject to reduction as set forth in the Stockholder
Agreement) and (ii) 170,000 shares of Preferred Stock at an exercise price
of $20.00 per share. At the date of the Stockholder Agreement, such shares
of Preferred Stock were convertible into 8,399,700 shares of Common Stock.
Such options will terminate upon the earlier of (i) the termination of the
Merger Agreement, dated as of August 27, 1998 (the "Merger Agreement"),
among the Reporting Person, a wholly owned subsidiary of the Reporting
Person and the Issuer, and (ii) the effective time of the merger provided
for therein. The foregoing summary is not a complete description of the
terms of the Stockholder Agreement, a copy of which is attached at Exhibit
10.3 to the Reporting Person's Schedule 13D, dated as of September 3, 1998
(the "Schedule 13D"), and incorporated herein by reference.
(2) Pursuant to a Stock Option Agreement, dated as of August 27, 1998 (the
"Stock Option Agreement"), between the Reporting Person and the Issuer, the
Issuer granted the Reporting Person an option to purchase up to 4,245,346
shares of Common Stock or such other number of shares of Common Stock as
equals 19.9% of the issued and outstanding shares of Common Stock at the
time of exercise of such option. Such option is exercisable only in the
circumstances provided in the Stock Option Agreement (which correspond to
circumstances in which a fee would be payable to the Reporting Person in
connection with the termination of the Merger Agreement) and, except in such
circumstances (in which case such option would expire one year after the
termination of the Merger Agreement), such option will expire upon the
earlier of (i) the termination of the Merger Agreement and (ii) the
effective time of the merger provided for therein. The foregoing summary is
not a complete description of the terms of the Stock Option Agreement, a
copy of which is attached at Exhibit 10.2 to the Schedule 13D and
incorporated herein by reference.
**INTENTIONAL MISSTATEMENTS OR OMISSIONS OF FACTS CONSTITUTE FEDERAL CRIMINAL
VIOLATIONS. SEE 18 U.S.C. 1001 AND 15 U.S.C. 78FF(A).
NOTE: FILE THREE COPIES OF THIS FORM, ONE OF WHICH MUST BE MANUALLY SIGNED.
IF SPACE IS INSUFFICIENT, SEE INSTRUCTION 6 FOR PROCEDURE.
POTENTIAL PERSONS WHO ARE TO RESPOND TO THE COLLECTION OF INFORMATION
CONTAINED IN THIS FORM ARE NOT REQUIRED TO RESPOND UNLESS THE FORM
DISPLAYS A CURRENTLY VALID OMB NUMBER.
STERLING SOFTWARE, INC.
BY: /s/ R. LOGAN WRAY SEPTEMBER 3, 1998
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R. LOGAN WRAY DATE
SENIOR VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
**SIGNATURE OF REPORTING PERSON
PAGE 2 OF 2 PAGES
