<PAGE>
As filed with the Securities and Exchange Commission on January 21, 1998
File No. 333-_______
_______________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_____________________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
_____________________________
GREENTREE SOFTWARE, INC.
(Exact Name of Registrant as Specified In Its Charter)
NEW YORK 13-2897997
(State or Other Jurisdiction (I.R.S. Employer Identification Number)
of Incorporated or Organization)
7901 Flying Cloud Drive, Suite 150, Eden Prairie, MN 55344
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
Joseph D. Mooney
Chairman of the Board of Directors and Chief Executive Officer
Greentree Software, Inc.
7901 Flying Cloud Drive, Suite 150
Eden Prairie, MN 55344
(612) 941-1500
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code of Agent For Service)
with copies to:
Julio E. Vega, Esq.
Bingham Dana LLP
150 Federal Street
Boston, Massachusetts 02110
(617) 951-8000
Approximate date of commencement of proposed sale to the public:
As soon as practicable after this Registration Statement becomes effective
If the only securities being registered on this form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. / /
If any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
CALCULATION OF REGISTRATION FEE
<TABLE>
- --------------------------------------------------------------------------------------------------------
Title of Securities Maximum Amount Proposed Maximum Offering Aggregate Proposed Amount of
to be Registered to be Registered Price Per Share*(1) Offering Price* Registration Fee
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Shares
$.01 Par Value 2,783,375 (2) $1.062 $2,955,944 $873
- --------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of determining the registration fee.
Calculated in accordance with Rule 457(c) based on the average of the high and
low prices reported on the OTC Bulletin Board on January 14, 1998.
(2) Includes 500,708 Common Shares being registered for resale by certain
Selling Shareholders of Common Shares issuable upon exercise of Common Share
Purchase Warrants and 24,352 Common Shares being registered for resale by
certain Selling Shareholders of Common Shares issuable upon exercise of stock
options.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to Section 8(a), may
determine.
<PAGE>
P R O S P E C T U S
GREENTREE SOFTWARE, INC.
2,783,375 Shares of
Common Shares, $.01 Par Value
____________
This Prospectus ("Prospectus") of Greentree Software, Inc., a New York
corporation (the "Company"), relates to up to 2,783,375 shares (the "Shares")
of the Company's Common Shares, $.01 par value per share (the "Common Shares"),
being sold by certain shareholders of the Company (the "Selling Shareholders"),
including certain directors and officers of the Company, for their respective
accounts. See "Selling Shareholders." The Company will not receive any proceeds
from the sale of Shares by the Selling Shareholders. The Common Shares are
traded on the OTC Bulletin Board under the symbol "GTSW." On January 14, 1998,
the last reported sale price of the Common Shares on the OTC Bulletin Board was
$1.187 per share.
____________
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK.
SEE "RISK FACTORS," BEGINNING ON PAGE 3
____________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
____________
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Underwriting Discounts Proceeds to Selling
Price to Public and Commissions Shareholders
- -------------------------------------------------------------------------------
Per Share (1) (1)(2) (1)(2)
- -------------------------------------------------------------------------------
Total (1) (1)(2) (1)(2)
- -------------------------------------------------------------------------------
(1) The sale or distribution of the Shares may be effected by the Selling
Shareholders through one or more underwriters, brokers, dealers or
agents from time to time in one or more transactions (which may involve
crosses or block transactions) in the over-the-counter market. Any of
such transactions may be effected at market prices prevailing at the
time of sale, at prices related to such prevailing market prices, at
varying prices determined at the time of sale or at negotiated or fixed
prices, in each case as determined by agreement between the Selling
Shareholder and underwriters, brokers, dealers or agents, or purchasers.
Transactions effected by selling Shares to or through underwriters,
brokers, dealers or agents, such underwriters, brokers, dealers or
agents may receive compensation in the form of discounts, concessions or
commissions from the Selling Shareholders or commissions from
purchasers of Shares for whom they may act as agent (which discounts,
concessions or commissions as to particular underwriters, brokers,
dealers or agents may be in excess of those customary in the types of
transactions involved). The Selling Shareholders and any brokers,
dealers or agents that participate in the distribution of the Shares may
be deemed to be underwriters, and any profit on the sale of Shares by
them and any discounts, concessions or commissions received by any such
underwriters, brokers, dealers or agents may be deemed to be
underwriting discounts and commissions under the Securities Act of 1933,
as amended (the "Securities Act").
Under the securities laws of certain states, the Shares may not be sold
unless the Shares have been registered or qualified for sale in such
state or an exemption from registration or qualification is available
and is complied with.
The Company will pay all of the expenses incident to the registration,
offering and sale of the Shares to the public hereunder other than
commissions, fees and discounts of underwriters, brokers, dealers and
agents. The Company has agreed to indemnify the Selling Shareholders
against certain liabilities, including liabilities under the Securities
Act.
Certain of the underwriters, dealers, brokers or agents may have other
business relationships with the Company and its affiliates in the
ordinary course. See "Plan of Distribution" and "Selling Shareholders."
(2) The Company has agreed to prepare and file this Prospectus and the
related Registration Statement and supplements and amendments thereto
required by the Securities Act with the Securities and Exchange
Commission, to register and qualify the Shares if required under
applicable Blue Sky laws, and to deliver copies of the Prospectus to the
Selling Shareholders. The expenses incurred in connection with the same,
estimated at $20,000, will be borne by the Company. The Company will
not be responsible for any discounts, concessions, commissions or other
compensation due to any broker or dealer in connection with the sale of
any of the Shares offered hereby, which expenses will be borne by the
Selling Shareholder.
The date of this Prospectus is January 21, 1998.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files periodic reports and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information concerning the Company may be inspected and copies may be
obtained (at prescribed rates) at public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549
and at the regional offices of the Commission located at Seven World Trade
Center, 13th Floor, New York, New York 10048 and at Northwest Atrium Center,
500 W. Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such
material can also be obtained from the Public Reference Section, Securities and
Exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, upon
payment of prescribed rates. The Commission also maintains an internet site
(http://www.sec.gov) that contains information regarding the Company's
electronic filings with the Commission.
The Company has filed a Registration Statement on Form S-3 (the
"Registration Statement") under the Securities Act with the Commission with
respect to the Common Shares being offered pursuant to this Prospectus. As
permitted by the rules and regulations of the Commission, this Prospectus omits
certain of the information contained in the Registration Statement. For
further information with respect to the Company and the Common Shares being
offered pursuant to this Prospectus, reference is hereby made to such
Registration Statement, including the exhibits filed as part thereof.
Statements contained in this Prospectus concerning the provisions of certain
documents filed with, or incorporated by reference in, the Registration
Statement are not necessarily complete, each such statement being qualified in
all respects by such reference. Copies of all or any part of the Registration
Statement, including the documents incorporated by reference therein or
exhibits thereto, may be obtained upon payment of the prescribed rates at the
offices of the Commission set forth above.
Upon request, the Company will provide without charge to each person to
whom a copy of this Prospectus has been delivered a copy of any information
that was incorporated by reference in the Prospectus (other than exhibits to
documents, unless such exhibits are specifically incorporated by reference into
the information incorporated by reference in the Prospectus). The Company will
also provide upon specific request, without charge to each person to whom a
copy of this Prospectus has been delivered, a copy of all documents filed from
time to time by the Company with the Commission pursuant to the Exchange Act.
Requests for such copies should be directed to Philip D. Wolf, 7901 Flying
Cloud Drive, Suite 150, Eden Prairie, MN 55344. Telephone requests may be
directed to the Secretary at (612) 941-1500.
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<PAGE>
RISK FACTORS
In considering whether to purchase any of the Shares offered hereby,
prospective investors should carefully consider the following risk factors,
among others discussed herein. This Prospectus contains and may incorporate by
reference forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934,
including but not limited to the potential for future orders and the existence
of expressions of interest in the GT Purchase PRO product. Investors are
cautioned that forward-looking statements are inherently uncertain. Actual
performance and results of operations may differ materially from those
projected or suggested in the forward-looking statements due to certain risks
and uncertainties, including but not limited to, the following risks and
uncertainties: (i) the Company's history of losses and accumulated deficit,
inconsistent revenues and the uncertainty of future profitability; (ii) the
Company's capital requirements and the uncertainty of additional funding; (iii)
the uncertainty of market acceptance of GT Purchase PRO software; (iv) new
management and the need to recruit sales, service and implementation personnel;
(v) the intense competition in the software field; and (vi) the dependence on
one product and rapid technological change in the industry. Additional
information concerning certain risks and uncertainties that would cause actual
results to differ materially from those projected or suggested in the forward-
looking statements is contained in the Company's filings with the Commission,
including those risks and uncertainties discussed below and in the Company's
Annual Report on Form 10-KSB for the year ended May 31, 1997. The forward-
looking statements contained herein represent the Company's judgment as of the
date of this Prospectus, and the Company cautions readers not to place undue
reliance on such statements.
HISTORY OF LOSSES AND ACCUMULATED DEFICIT; UNCERTAINTY OF FUTURE
PROFITABILITY. The Company had a net loss of approximately $1.8 million for
the fiscal year ended on May 31, 1997 and had an accumulated deficit at May
31, 1997 of approximately $14.6 million. The Company had a net loss of
approximately $1.0 million for the six months ended on November 30, 1997 and
had an accumulated deficit of approximately $15.7 million at November 30,
1997. The Company has experienced ongoing losses from operations and expects
that such losses will continue for at least some period until product sales
may be generated in sufficient volume to offset expenses. For the fiscal year
ended May 31, 1997, the Company had revenues of $599,000. For the six months
ended November 30, 1997, the Company has had revenues of $189,000 compared
with $171,000 for the same period in 1996. There can be no assurance the
Company's revenues will continue at all or will grow sufficiently to achieve
profitability. The Company does not expect to be profitable unless and until
such time as sales of its software products generate sufficient revenue to
fund its operations.
CAPITAL REQUIREMENTS; UNCERTAINTY OF ADDITIONAL FUNDING. At November 30,
1997 the Company had a cash balance of approximately $29,000. Predicting the
costs of the ongoing development of the Company's software product and of the
expansion of its sales force and other required personnel, as well as its
working capital and other capital needs, is difficult. There can be no
assurance that revenues, if any, generated by the Company from the sale of
its software product will be adequate to successfully market its software
product and to expand its sales force. The Company anticipates that it may
have to raise additional capital to fund continued operations. There can be
no assurance that any such required capital would be available on acceptable
terms, if at all. If the Company is unable to raise such additional capital
on acceptable terms, it could have to discontinue operations and liquidate.
It is highly likely that investors would lose all of their investment in the
event of any liquidation of the Company's assets.
UNCERTAINTY OF MARKET ACCEPTANCE OF GT PURCHASE PRO. The Company has
invested heavily in research for, and development of, its core purchasing and
materials management software system - GT Purchase PRO. The orders received to
date for the GT Purchase PRO product have been significantly lower than
expected by management. Management believes that this was due primarily to a
variety of problems which were partly created by one of the development tools
used to develop the initial product. The Company believes that its history of
financial and product performance problems has negatively affected its image in
the marketplace and that it has lost potential business from potential clients
who expressed concerns about the Company's current financial status and ability
to remain solvent. The Company believes the software
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<PAGE>
development toolset used to produce GT Purchase PRO 6.0 has corrected the
performance problems associated with the prior version of the product;
however, there can be no assurance that (i) such performance problems have
been completely eliminated; (ii) any further required development work will
be completed on a timely basis; (iii) there will be satisfactory acceptance
of the new product into the marketplace; or (iv) revenues from this new
product will be realized in any material amounts, if at all, and if realized,
when.
NEW MANAGEMENT, ABILITY TO RECRUIT SALES, SERVICE AND IMPLEMENTATION
PERSONNEL. The Company's new management share a very limited history in
operating the Company even though they are experienced in managing companies
with the problems similar to those being faced by the Company. There can be no
assurance that the Company's management will be successful in meeting their
planned objectives for the Company. The ability to achieve anticipated
revenues is substantially dependent on the ability of the Company to attract on
a timely basis and retain skilled personnel, especially key management, sales,
service, and implementation personnel. The Company believes that its future
success will depend in large part on its ability to attract and retain highly
skilled technical, managerial, marketing, and professional services personnel
to ensure the quality of products and services provided to its customers.
Competition for such personnel, in particular for product development and
implementation personnel, is intense, and the Company competes in the market
for such personnel against numerous companies, including larger, more
established companies with significantly greater financial resources than the
Company. There can be no assurance that the Company will be successful in
attracting and retaining skilled personnel. The Company's inability to attract
and retain qualified employees would have a material adverse effect on the
Company's business.
SUBSTANTIAL COMPETITION. The software field is a growing one and, in
addition to the computer manufacturers which also offer software products
performing functions similar to the Company's products, a large number of
providers of industry-specific applications and software developers are
introducing new purchasing modules and software programs into the market.
Existing competitive products offered by companies with greater financial or
marketing resources impact and limit the Company's revenues. There can be no
assurances that competitors do not have or will not offer or develop products
that are superior to the Company's products or that achieve greater market
acceptance. In addition, suppliers of relational database management systems
and companies that develop management information software applications for
large multinational manufacturers have begun to target the firms targeted by
the Company and offer applications that compete in the Company's markets. As a
result, competition (including pricing competition) may increase, which could
result in price reduction and loss of market share. The Company may also face
market resistance from potential customers from the large installed base of
legacy systems, who may be reluctant to commit the time and resources necessary
to convert to an open systems-based client/server software product. As the
client/server computing market expands, a large number of companies, many with
significantly greater resources than the Company, may enter the market or
increase their market share by acquiring or entering into an alliance with
competitors of the company. There can be no assurance that the Company will be
able to compete successfully against its competitors or that the competitive
pressures faced by the Company will not adversely affect its financial
performance.
DEPENDENCE ON ONE PRODUCT. Substantially all of the Company's revenues
are expected to be derived from the sale of its GT Purchase PRO 6.0 and related
support services. Accordingly, any event that adversely affects fees from such
product or fees derived from the sale of such product, such as competition from
other products, significant flaws in the product, or incompatibility with third
party hardware or software products, negative publicity or evaluation, or
obsolescence of the hardware platforms or software environments in which the
product runs, could have a material effect on the Company's results of
operations. The Company's future financial performance will depend on the
continued development and introduction of new and enhanced versions of GT
Purchase PRO 6.0 and other products and on customer acceptance of such new
enhanced products.
RAPID TECHNOLOGICAL CHANGE AND NEW PRODUCTS. The market for the Company's
software products is characterized by rapid technological advances, evolving
industry standards, change in end-user requirements, and frequent new product
introductions and enhancements. The introduction of products embodying new
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<PAGE>
technologies and the emergence of new industry standards could render the
Company's existing products and products currently under development as
obsolete and unmarketable. Accordingly, the Company's future success will
depend upon its ability to enhance its current products and develop and
introduce new products that keep pace with technological developments, satisfy
varying end-user requirements, and achieve market acceptance. Any failure by
the Company to anticipate or respond adequately to technological developments
or end-user requirements, or any significant delays in product development or
introduction, could severely damage the Company's competitive position and have
an adverse effect on revenues. There can be no assurance that the Company will
be successful in developing and marketing new products or product enhancements
on a timely basis or that the Company will not experience significant delays in
the future which could have a material adverse effect on the Company's results
of operations. In addition, there can be no assurance that new products or
product enhancements developed by the Company will achieve market acceptance.
INTELLECTUAL PROPERTY AND PROPRIETARY RIGHTS. The Company intends to rely
on a combination of copyright, trademark and trade secret laws, employee and
third party nondisclosure agreements, and other industry standard methods for
protecting ownership of its proprietary software. There can be no assurance,
however, that in spite of these precautions, an unauthorized third party will
not copy or reverse-engineer certain portions of the Company's products or
obtain and use information that the Company regards as proprietary. In
addition, the laws of some foreign countries do not protect the Company's
proprietary rights to the same extent as do the laws of the United States.
There can be no assurance that the mechanisms used by the Company to protect
its software will be adequate or that the Company's competition will not
independently develop software products that are substantially equivalent or
superior to the Company's software products.
The Company expects that, as the number of software products in the
industry increases and the functionality of these products further overlaps,
software products will increasingly be subject to claims of infringement on
third party proprietary rights. Any such claim, whether with or without merit,
could result in costly litigation and require the Company to enter into royalty
or licensing arrangements. Such royalty or license arrangements, if required,
may not be available on terms and acceptable to the Company or at all.
SHARES ELIGIBLE FOR FUTURE SALE. Assuming that the holders of the
Company's outstanding options and warrants exercise their respective
securities, there would be issued an aggregate of up to approximately 1,500,000
additional Common Shares. Management of the Company is of the opinion that, if
a substantial number of such Common Shares were offered at one time, such an
offering would likely have an adverse effect on the market price for the Common
Shares. In addition, if the market price were to decline because of such an
offering of shares, management is of the opinion that such development may
adversely affect the ability of the Company to raise additional capital in the
equity markets at a price and at a time favorable to the Company when and if
such financing was necessary in the future.
DIVIDENDS. In view of the cash requirements of the Company and the
current and anticipated operating losses, the Company does not intend to pay
dividends on the Common Shares in the foreseeable future.
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<PAGE>
THE COMPANY
Greentree Software, Inc. designs, develops, markets and services
purchasing and materials management application specific software. The Company
introduced its first purchasing software product in 1985 and has completed the
development of the base software product and related "core" modules of the
latest version of its GT Purchase PRO product, which is designed to be a
portable and scalable family of modules of client/server purchasing related
applications for use in medium- and large-size organizations. The Company has
and intends to continue to design its latest generation software specifically
for the client/server model of computing and believes that its software offers
significant performance and functional advantages over competing purchasing
software products used in enterprise-level client/server environments. The
Company's software products are developed primarily with fourth generation
language rapid application tool sets which are designed specifically to take
advantage of national database management systems and Microsoft Windows(R).
The Company's principal executive offices are located at 7901 Flying Cloud
Drive, Eden Prairie, MN 55344 and its telephone number at those offices is
(612) 941-1500.
RECENT DEVELOPMENTS
Cash Balance; Liquidity; Financing
From October to December 1997, the Company sold 567,315 Common Shares at
an average price of $.68 per share to accredited investors in transactions
exempt from the registration requirements of the Securities Act and received
gross proceeds of $385,389. The net proceeds from the offerings (there were no
cash placement or agency fees) were used for working capital purposes including
payment of outstanding payables and to fund the marketing of the Company's GT
Purchase Pro-TM- product.
On December 19, 1997, the Company issued a convertible note in the
original principal amount of $50,000 to an accredited investor. This
convertible note was issued at face value, has a ninety day term, and is
convertible into Common Shares at the holder's option at the lesser of $.6875
per share or 70% of the average bid price of the Common Shares for the five
days preceding the conversion. If the holder elects not to convert the
convertible note, the Company will issue 10,000 shares of Common Shares in
lieu of interest. The issuance and sale of the convertible note was made in
reliance on Section 4(2) of the Securities Act.
Prior to these offerings, the Company has experienced cash shortages and a
lack of liquidity and capital resources that had caused some delays in paying
suppliers and vendors. The Company has experienced several prolonged periods
when it was unable to attract sufficient capital to sustain operations. See
"Risk Factors."
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<PAGE>
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Shareholders.
SELLING STOCKHOLDERS
The following table sets forth certain information regarding the
beneficial ownership of the Common Shares as of December 31, 1997 and as
adjusted to reflect the sale of Common Shares offered hereby by each of the
Selling Shareholders.
Except as set forth below, none of the Selling Shareholders has had any
position, office or other material relationship within the past three years
with the Company or its affiliates.
Shares Shares to be
Beneficially Beneficially
Owned Prior to Shares Owned After
Name of Selling Shareholder Offering (1) Offered (2) Offering
Number Percent
------ -------
Dean Andersen 29,091 29,091 - *
AWAD & Associates, LP 44,999 44,999 - *
Richard Battaglino 14,166 14,166 - *
Mark Cahill (3) 285,052 285,052 - *
George Michael Cassidy (4) 17,873 17,873 - *
Craig Chesley 21,666 21,666 - *
Donald O. Collins Rev. Trust 13,888 13,888 - *
Joseph Garipoli 8,333 8,333 - *
J. Robert Gary (5) 28,985 28,985 - *
Gilmore & Co. (6) 56,366 56,366 - *
V.R. Gusdorff 1,666 1,666 - *
Wilber Hensler 25,000 25,000 - *
Shikar Jain 60,000 60,000 - *
Larry Jeddeloh (7) 222,776 222,776 - *
Mitchel Kaplan 1,666 1,666 - *
Paul Kaplan 20,000 20,000 - *
Little Wing, L.P. 195,238 195,238 - *
Murray Logan 99,403 68,333 31,070 *
Anthony Mann 3,333 3,333 - *
Brad Markowitz (8) 174,886 4,443 170,443 5.18
John Medico (9) 27,777 27,777 - *
Douglas Metcalf 10,833 10,833 - *
Robert Metcalf 35,000 35,000 - *
Glenn Miller 20,000 20,000 - *
Joseph Mooney (10) 186,666 20,000 166,666 5.05
Joseph Pelikan 89,392 89,392 - *
Eric and Ellen Petersen (11) 120,370 112,542 7,828 *
Jeffrey Pinkerton (12) 152,169 8,333 143,836 4.40
Pioneer Group Ltd. 131,750 131,750 - *
Raymond Scott 6,000 6,000 - *
Suresh Singal 20,000 20,000 - *
William Smith (13) 186,023 181,037 4,986 *
Jerry Snyder 16,666 16,666 - *
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<PAGE>
T.I.S. Acquisition &
Management Group, Inc. (14) 208,888 208,888 - *
Travelers Indemnity Co. (15) 952,553 952,553 - *
John Walker 6,000 6,000 - *
Wm Smith & Co., Inc. (16) 162,537 162,537 - *
David Zelman 16,666 16,666 - *
_______________________
* Less than 1% of the outstanding shares of Common Stock.
(1) Beneficial ownership is determined in accordance with Rule 13d-3(d)
promulgated by the Commission under the Securities and Exchange Act of
1934, as amended. Shares of Common Shares issuable pursuant to options,
warrants and convertible securities, to the extent such securities are
currently exercisable or convertible within 60 days of December 15, 1997,
are treated as outstanding for computing the percentage of the person
holding such securities but are not treated as outstanding for computing
the percentage of any other person. Unless otherwise noted, each person or
group identified possesses sole voting and investment power with respect
to shares, subject to community property laws where applicable. Shares
not outstanding but deemed beneficially owned by virtue of the right of a
person or group to acquire them within 60 days are treated as outstanding
only for purposes of determining the number of and percent owned by such
person or group.
(2) See "Plan of Distribution."
(3) Includes 12,725 Common Shares which Mr. Cahill has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants and 17,999 shares held by Raymond James & Associates,
Inc. as custodian for Mark W. Cahill.
(4) Includes 7,040 Common Shares which Mr. Cassidy has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants. Mr. Cassidy was Chief Executive Officer of the Company
until October 4, 1995.
(5) Includes 7,040 Common Shares which Mr. Gary has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants. Mr. Gary was Treasurer, Chief Financial Officer and a
director of the Company until October 4, 1995.
(6) Includes 56,366 Common Shares which Gilmore & Co. has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants.
(7) Includes 193,888 Common Shares which are held by T.I.S. Acquisition &
Management Group, Inc. ("TIS Acquisition"), 10,000 shares which are held
by T.I.S. Group, Inc. ("TIS Group") and 5,000 Common Shares which TIS
Group has the right to acquire within 60 days of December 31, 1997 upon
the exercise of Common Shares Purchase Warrants. Mr. Jeddeloh is the sole
director and executive officer of TIS Acquisition and the managing
director, chief investment officer and president of TIS Group and as
such, shares investment power with respect to TIS Acquisition and TIS
Group and may be deemed to beneficially own all of the shares owned by
TIS Acquisition and TIS Group, although he disclaims beneficial ownership
of such shares except to the extent of his proportionate ownership
interest in each of TIS Acquisition and TIS Group.
(8) Includes 95,833 Common Shares which Mr. Markowitz has the right to acquire
within 60 days of December 31, 1997 upon the exercise of stock options,
10,544 Common Shares which are held by Focus Capital Group, Inc. ("Focus
Capital") and 64,066 Common Shares which Focus Capital has the right to
acquire within 60 days of December 31, 1997 upon the exercise of Common
Shares Purchase Warrants. Mr. Markowitz is the president of Focus Capital
and as such has sole investment power with respect to Focus Capital and
may be deemed to beneficially own all of the shares owned by Focus
Capital, although he disclaims beneficial ownership of such shares. Mr.
Markowitz is a director of the Company.
(9) Includes 24,352 Common Shares which Mr. Medico has the right to acquire
within 60 days of December 31, 1997 upon exercise of stock options. Mr.
Medico was Chief Executive Officer of the Company from October 4, 1995 to
August 9, 1996.
-8-
<PAGE>
(10) Includes 166,666 Common Shares which Mr. Mooney has the right to acquire
within 60 days of December 31, 1997 upon exercise of stock options. Mr.
Mooney is Chairman of the Board of Directors and Chief Executive Officer
of the Company.
(11) Includes 5,952 Common Shares held by DLJSC FBO Eric Petersen and 2,500
Common Shares held by DLJSC FBO Eric Petersen IRA Account.
(12) Includes 124,999 Common Shares which Mr. Pinkerton has the right to
acquire within 60 days of December 31, 1997 upon exercise of stock options
and 13,293 Common Shares which Mr. Pinkerton has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants. Mr. Pinkerton is President and a director of the
Company.
(13) Includes 4,986 Common Shares which Mr. Smith has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants and 162,537 Common Shares which Wm Smith & Co., Inc.
("Smith & Co.") has the right to acquire within 60 days of December 31,
1997 upon exercise of Common Shares Purchase Warrants. Mr. Smith is the
president of Smith & Co. and as such has sole investment power with
respect to Smith & Co. and may be deemed to beneficially own all of the
shares owned by Smith & Co. although he disclaims beneficial ownership of
such shares except to the extent of his proportional ownership interest.
(14) Includes 193,888 Common Shares which are held by TIS Acquisition, 10,000
shares which are held by TIS Group and 5,000 Common Shares which TIS Group
has the right to acquire within 60 days of December 31, 1997 upon the
exercise of Common Shares Purchase Warrants.
(15) Includes 111,111 Common Shares owned by Primerica Life Insurance, 591,442
Common Shares owned by Travelers Indemnity Co., and 250,000 Common Shares
which Travelers Indemnity Co. has the right to acquire within 60 days of
December 31, 1997 upon exercise of Common Shares Purchase Warrants.
(16) Includes 162,537 Common Shares which Smith & Co. has the right to acquire
within 60 days of December 31, 1997 upon exercise of Common Shares
Purchase Warrants.
-9-
<PAGE>
PLAN OF DISTRIBUTION
The sale or distribution of the Shares may be effected through one or more
underwriters, brokers, dealers or agents from time to time in one or more
transactions (which may involve crosses or block transactions) in the over-the-
counter market. Any of such transactions may be effected at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices, at varying prices determined at the time of sale or at negotiated or
fixed prices, in each case as determined by effected agreement between the
Selling Shareholder and underwriters, brokers, dealers or agents, or
purchasers. Transactions effected by selling Shares to or through underwriters,
brokers, dealers or agents, such underwriters, brokers, dealers or agents may
receive compensation in the form of discounts, concessions or commissions from
the Selling Shareholders or commissions from purchasers of Shares for whom they
may act as agent (which discounts, concessions or commissions as to particular
underwriters, brokers, dealers or agents may be in excess of those customary in
the types of transactions involved). The Selling Shareholders and any brokers,
dealers or agents that participate in the distribution of the Shares may be
deemed to be underwriters, and any profit on the sale of Shares by them and any
discounts, concessions or commissions received by any such underwriters,
brokers, dealers or agents may be deemed to be underwriting discounts and
commissions under the Securities Act.
Under the securities laws of certain states, the Shares may not be sold
unless the Shares have been registered or qualified for sale in such state or
an exemption for registration or qualification is available and is complied
with.
The Company will pay all of the expenses incident to the registration,
offering and sale of the Shares to the public hereunder other than commissions,
fees and discounts of underwriters, brokers, dealers and agents. The Company
has agreed to indemnify the Selling Shareholders and any underwriters against
certain liabilities, including liabilities under the Securities Act.
EXPERTS
The financial statements as of May 31, 1997 and for the year then ended
incorporated in this Prospectus by reference to the Annual Report on Form
10-KSB for the year ended May 31, 1997, have been so incorporated in reliance
on the report (which contains an explanatory paragraph relating to the
Company's ability to continue as a going concern as described in Note 1 to
the financial statements) of Price Waterhouse LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
The financial statements of Greentree Software, Inc. as of May 31, 1996,
and for the fiscal year then ended have been incorporated by reference
herein and in the registration statement in reliance upon the report of KPMG
Peat Marwick LLP, independent certified public accountants, incorporated by
reference herein, and upon the authority of said firm as experts in
accounting and auditing. The report of KPMG Peat Marwick LLP covering the
May 31, 1996 financial statements contains an explanatory paragraph that
states that the financial statements "have been prepared assuming the Company
will continue as a going concern. As discussed in notes 1 and 5 to the
financial statements, the Company has incurred substantial losses from
operations, has a working capital deficit, an accumulated deficit, and a
liquidity deficiency, and is currently party to lawsuits, one of which
involves its rights to continue to sell its primary product. These matters
raise substantial doubt about the Company's ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 1 to the financial statements. The financial statements do not include
any adjustments that might result from the outcome of this uncertainty."
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There is incorporated herein by reference the Annual Report on Form
10-KSB of the Company for the fiscal year ended May 31, 1997, the Quarterly
Reports on Form 10-QSB of the Company for the fiscal quarters ended August
31, 1997 and November 30, 1997 filed with the Commission pursuant to Section
13(a) of the Exchange Act, and the description of the Common Shares contained
in the Company's Registration Statement on Form 8-A filed with the Commission
pursuant to Section 12(g) of the Exchange Act.
-10-
<PAGE>
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
or 15 (d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Shares shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing such documents. Any statement contained herein, or in a document
all or a portion of which is incorporated or deemed to be incorporated by
reference herein, shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document or portion thereof which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
DISCLOSURE OF COMMISSION POSITION ON
INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
The Company has entered into Registration Rights Agreements that provide
for indemnification by the Comapny of certain of the Selling Stockholders
against certain liabilities under the Securities Act, the Securities Exchange
Act, states securities laws, or otherwise, and provides for indemnification by
certain of the Selling Stockholders of the Company and its directors, its
officers and certain control persons against certain liabilities under the
Securities Act, the Securities Exchange Act, state securities laws, or
otherwise.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable.
-11-
<PAGE>
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
No person has been authorized to
give any information or to make
any representations in connection
with this offering other than
those contained in this Prospectus
and, if given or made, such other
information and representations 2,783,375 Shares
must not be relied upon as having
been authorized by the Company. GREENTREE SOFTWARE, INC.
Neither the delivery of this
Prospectus nor any sale made Common Shares
hereunder shall, under any
circumstances, create any
implication that there has been no
change in the affairs of the PROSPECTUS
Company since the date hereof or
that the information contained
herein is correct as of any time ____________
subsequent to its date. This
Prospectus does not constitute an January 21, 1998
offer to sell or a solicitation of
an offer to buy any securities
other than the registered
securities to which it relates.
This Prospectus does not
constitute an offer to sell or a
solicitation of an offer to buy
such securities in any
circumstances in which such offer
or solicitation is unlawful.
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated expenses in connection with the issuance and distribution of
the securities being registered, other than underwriting compensation,
are:
SEC Registration Fee. . . . . . . . . . . . . . . . . . . . . $ 873
Transfer Agent and Registrar Fees and Expenses. . . . . . . . 11,000
Legal Fees and Expenses . . . . . . . . . . . . . . . . . . . 30,000
Blue Sky Fees and Expenses. . . . . . . . . . . . . . . . . . 20,000
Accounting Fees and Expenses. . . . . . . . . . . . . . . . . 5,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . ______
---------
---------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . $66,873
---------
---------
____________________
* Estimates
Item 15. Indemnification of Directors and Officers.
The By-Laws of the Registrant provide for indemnification of officers and
directors to the fullest extent provided by New York law. Section 722 of the
Business Corporation Law of the State of New York contains provisions entitling
directors and officers of the Registrant to indemnification from judgments,
fines, amounts paid in settlement and reasonable expenses, including attorneys'
fees, as the result of an action or proceeding in which they may be involved by
reason of being, or having been, a director or officer of the Registrant or
serving another corporation in such capacity at the request of the Registrant,
provided said directors or officers acted in good faith.
The Registrant has entered into Registration Rights Agreements that
provide for indemnification by the Registrant of certain of the Selling
Stockholders against certain liabilities under the Securities Act, the
Securities Exchange Act, states securities laws, or otherwise, and provides for
indemnification by certain of the Selling Stockholders of the Registrant and
its directors, its officers and certain control persons against certain
liabilities under the Securities Act, the Securities Exchange Act, state
securities laws, or otherwise.
Item 16. Exhibits.
5. Opinion of Bingham Dana LLP.
23.1. Consent of Bingham Dana LLP (included in Exhibit 5).
23.2. Consent of Price Waterhouse LLP.
23.3. Consent of KPMG Peat Marwick LLP.
24. Power of Attorney (included on signature page).
II-1
<PAGE>
Item 17. Undertakings.
(A) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made pursuant to this Registration Statement, a post-effective
amendment to this Registration Statement to include any
additional charged material information on the plan of
distribution.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide
offering thereof.
(3) To file a post-effective amendment to remove from registration
any of the securities being registered which remain unsold at
the termination of the offering.
(B) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 (the "Act") may be permitted to directors,
officers and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been advised
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Eden Prairie and the State of Minnesota as of
January 21, 1998.
GREENTREE SOFTWARE, INC.
By: /s/ Joseph D. Mooney
--------------------------------------
Joseph D. Mooney
Chairman of the Board of Directors and
Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby appoints Joseph D.
Mooney and or Philip D. Wolf, his/her true and lawful attorney-in-fact with
the authority to execute in the name of each such person, and to file with
the Securities and Exchange Commission, together with any exhibits thereto
and other documents therewith, any and all amendments (including without
limitation post-effective amendments) to this registration statement
necessary or advisable to enable the Registrant to comply with the Securities
Act of 1933, as amended, and any rules, regulations and requirements of the
Securities and Exchange Commission in respect thereof, which amendments may
make such other changes in the registration statement as the aforesaid
attorney-in-fact executing the same deems appropriate.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed below as of January 21,
1998 by the following persons on behalf of the Registrant and in the
capacities indicated.
Name Title Date
/s/ Joseph D. Mooney Chairman of the Board of January 21, 1998
- ---------------------- Directors, Chief Executive
Joseph D. Mooney Officer, and Director
(principal executive officer)
/s/ Philip Wolf Treasurer (principal financial January 21, 1998
- ---------------------- and accounting officer)
Philip Wolf
/s/ Jeffrey B. Pinkerton President and Director January 21, 1998
- ----------------------
Jeffrey B. Pinkerton
/s/ Brad I. Markowitz Director January 21, 1998
- ----------------------
Brad I. Markowitz
II-3
<PAGE>
EXHIBIT 5
Bingham Dana LLP
150 Federal Street
Boston, MA 02110
January 20, 1998
Greentree Software, Inc.
7901 Flying Cloud Drive, Suite 150
Eden Prairie, MN 55334
Re: Registration Statement on Form S-3 Under the Securities Act of 1933,
as amended
Ladies and Gentlemen:
We have acted as special counsel to Greentree Software, Inc., a New York
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended (the "Act"), of 2,258,315 shares (the
"Shares") of the Common Shares, $.01 par value per share (the "Common Shares"),
of the Company, and 500,708 Common Shares (the "Warrant Shares"), issuable upon
the exercise of Common Share Purchase Warrants (the "Warrants"), and 24,352
Common Shares (the "Option Shares"), issuable upon the exercise of stock options
(the "Options"), all to be offered by certain stockholders of the Company
pursuant to a Registration Statement on Form S-3, filed by the Company with the
Securities and Exchange Commission (the "Commission") on January 21, 1998.
As such counsel, we have reviewed (i) the Certificate of Incorporation, as
amended, of the Company, (ii) the By-laws, as amended, of the Company, (iii) the
Warrants, (iv) the Options, (v) the corporate proceedings taken by the Company
with respect to the authorization of the Warrants, the Options, the issuance of
the Shares, the issuance of the Warrant Shares upon exercise of the Warrants
and the issuance of the Option Shares upon exercise of the Options, all as
certified to us by officers of the Company, and (vi) a certificate executed
and delivered by certain officers of the Company (the "Officers' Certificate").
We have made no other documentary review of any kind whatsoever. In connection
with our opinion provided herein, our investigation revealed that the minute
book of the Company containing all resolutions of the Board of Directors and of
the shareholders of the Company other than those specifically reviewed by us in
connection with this opinion is unavailable to the Company and to us. As a
consequence, we have relied upon the presumption of regularity and continuity to
the extent necessary to enable us to provide our opinion.
With regard to all matters of fact (including factual conclusions and
characterizations and descriptions of purpose, intention or other state of
mind), we have relied entirely upon the Officers' Certificate and have assumed,
without independent inquiry, the accuracy of the
<PAGE>
Greentree Software, Inc.
January 20, 1998
Page 2
Officer's Certificate. We have assumed without any investigation the
genuineness of all signatures, the conformity to the originals of all documents
reviewed by us as copies, the authenticity and completeness of all original
documents reviewed by us in original or copy form, and the legal competence of
each individual executing a document.
In rendering our opinion below regarding the Shares, we have assumed,
without investigation, that the Company has received the consideration called
for by the resolutions of the Board of Directors of the Company authorizing the
issuance of the Shares. We have also assumed that Common Shares of the Company
are regularly quoted in an over-the-counter market by one or more members of a
national or an affiliated securities association as set forth in Section 630 of
the Business Corporation Law of the State of New York.
We have also assumed that the registration requirements of the Act and all
applicable requirements of state laws regulating the sale of securities will
have been duly satisfied.
This opinion is limited solely to the Business Corporation Law of the State
of New York, as reported in McKinney's Consolidated Laws of New York Annotated
(West Publishing Co. 1986).
Based upon the foregoing, we are of the opinion that the Shares are validly
issued, fully paid and non-assessable, that the Warrant Shares, when issued upon
exercise of the Warrants in accordance with the terms of the Warrants will be
validly issued, fully paid and non-assessable, and that the Option Shares, when
issued upon exercise of the Options in accordance with the terms of the Options
will be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Bingham Dana LLP
---------------------
BINGHAM DANA LLP
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
August 6, 1997 appearing on page F-2 of Greentree Software, Inc.'s Annual Report
on Form 10-KSB for the year ended May 31, 1997. We also consent to the
reference to us under the heading "Experts" in such Prospectus.
/s/ Price Waterhouse LLP
Price Waterhouse LLP
Minneapolis, Minnesota
January 13, 1998
<PAGE>
EXHIBIT 23.3
CONSENT OF KPMG PEAT MARWICK LLP
The Board of Directors
Greentree Software, Inc.:
Our report dated September 11, 1996 contains an explanatory paragraph that
states that "the accompanying financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Notes 1 and
5 to the financial statements, the Company has incurred substantial losses from
operations, has a working capital deficit, an accumulated deficit, and a
liquidity deficiency, and is currently party to two lawsuits, one of which
involves its rights to continue to sell its primary product. These matters
raise substantial doubt about the Company's ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 1 to the financial statements. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty."
We consent to the use of our report incorporated herein by reference and to
the reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG Peat Marwick LLP
St. Petersburg, Florida
January 13, 1998
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<PAGE>
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<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAY-31-1998
<PERIOD-START> JUN-01-1997
<PERIOD-END> NOV-30-1997
<CASH> 29,196
<SECURITIES> 0
<RECEIVABLES> 76,937
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 109,924
<PP&E> 52,084
<DEPRECIATION> 0
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0
0
<COMMON> 29,666
<OTHER-SE> (321,754)
<TOTAL-LIABILITY-AND-EQUITY> 543,624
<SALES> 188,752
<TOTAL-REVENUES> 188,752
<CGS> 257,406
<TOTAL-COSTS> 257,406
<OTHER-EXPENSES> 965,727
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