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Appletree Companies Inc – ‘S-3’ on 10/2/96

As of: Wednesday, 10/2/96 · Accession #: 881106-96-16 · File #: 333-13251

  As Of                Filer                Filing    For·On·As Docs:Size

10/02/96  Appletree Companies Inc           S-3                    1:43K

Registration Statement for Securities Offered Pursuant to a Transaction — Form S-3
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-3         Registration Statement for Securities Offered         21     81K 
                          Pursuant to a Transaction

Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Exhibits Indemnification of Directors and Officers Other Expenses of Issuance and Distribution Plan of Distribution Risk Factors Selling Shareholders Undertakings
1	1st Page - Filing Submission
5	Risk Factors
9	Selling Shareholders
12	Plan of Distribution
14	Item 14. Other Expenses of Issuance and Distribution
"	Item 15. Indemnification of Directors and Officers
15	Item 16. Exhibits
"	Item 17. Undertakings

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As filed with the Securities and Exchange Commission on September 3, 1996       
Registration No. 33-       -                                                    
--------                                
SECURITIES AND EXCHANGE COMMISSION                                              
Washington, D.C. 20549                                                          

Form S-3                                                                        
REGISTRATION STATEMENT                                                          
Under                                                                           
THE SECURITIES ACT OF 1933                                                      

THE APPLETREE COMPANIES, INC.                                                   
(Exact name of registrant as specified in its charter)                          

        DELAWARE                                                      65-0205933
(State or other jurisdiction of                           (IRS Employer         
Incorporation or organization)                          Identification No.)     

5732 Curlew Drive                                                               
Norfolk, Virginia  23502                                                        
(757) 466-9200                                                                  
(Address, including zip code and telephone number,                              
including area code, of Registrant's Principal Executive Offices)               

Approximate date of commencement of proposed sale to the public:                
As soon as practicable after this registration becomes effective                

If the only securities being registered on this Form are to be 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, other than securities offered only in connection with a dividend or       
interest reinvestment plan, 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 this prospectus is expected to be made pursuant to Rule 434,     
please check the following box.  { }                                            

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CALCULATION OF REGISTRATION FEE                                                 

                                                                [Download Table]

                                   Proposed    Proposed      Amount 
                                    Maximum     Maximum        of   
                       Amount      Offering    Aggregate     Regis- 
Title of Securities    to be       Price Per    Offering     tration
to be Registered     Registered    Share (1)    Price (1)     Fee   

Common Stock,                                                       
 par value $.001     121,300,504     $.08     $9,704,040     $3,346 

(1)     Estimated solely for the purpose of calculating the registration fee    
pursuant to Rule 457(c) under the Securities Act of 1933.  The                  
calculation of the registration fee is based on $.08, which was the             
average of the high and low prices of the Common Stock for the five days        
ended August 30, 1996, as reported in The Wall Street Journal for NASDAQ        
SmallCap Market issues.                                                         

        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 said Section 8(a), may determine.                                   

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PROSPECTUS                                                                      

THE APPLETREE COMPANIES, INC.                                                   

121,300,504 Shares of Common Stock                                              
Par Value $.001 Per Share                                                       

 The Common Stock of The AppleTree Companies, Inc. (the "Company")
offered hereby (the "Shares") may be sold by certain shareholders of the        
Company (the "Selling Shareholders").  The Company will not receive any of      
the proceeds from the offering.                                                 

        The Common Stock of the Company is traded over-the-counter in the NASDAQ
SmallCap Market.  On August 29, 1996 the closing price for the Common Stock     
as reported in The Wall Street Journal was $.0625 per share.                    

  The Shares may be offered or sold from time to time by the Selling
Shareholders at market prices then prevailing, in negotiated transactions or    
otherwise.  Brokers or dealers will receive commissions or discounts from       
Selling Shareholders in amounts to be negotiated immediately prior to the       
sale.  See "Plan of Distribution."                                              

        See "Risk Factors" beginning on page 1 for a discussion of certain risks
related to an investment in the Shares.                                         

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND    
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR          
ADEQUACY OF THIS PROSPECTUS.  ANY REPRESENTATION TO THE CONTRARY IS A           
CRIMINAL OFFENSE.                                                               

_______________________                                                         

    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.  This Prospectus does not constitute an offering in any     
jurisdiction in which such offering may not lawfully be made.                   
________________________                                                        

   Neither the delivery of this Prospectus nor any sale made hereunder
shall, under any circumstances, create any implication that there has been no   
change in the affairs of the Company since the respective dates of which        
information has been given herein.                                              

The date of this Prospectus is September 3, 1996.                               

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TABLE OF CONTENTS                                                               

Page                                                                            

THE COMPANY                                             5                       
AVAILABLE INFORMATION                                   5                       
RISK FACTORS                                            5                       
SELLING SHAREHOLDERS                                    8                       
PLAN OF DISTRIBUTION                                   12                       
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE        13                       
EXPERTS                                                13                       
INFORMATION NOT REQUIRED IN THE PROSPECTUS             14                       
SIGNATURES                                             16                       
EXHIBIT INDEX                                          18                       

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THE COMPANY                                                                     

       The AppleTree Companies, Inc., a Delaware corporation ("AppleTree"), is
a holding company with substantially all of its business operations performed   
by its principal wholly owned operating subsidiary, Americas Foods, Inc.        
("AFI").  Unless otherwise stated herein the term "Company" includes            
AppleTree, its other subsidiaries, and AFI.  The Company manufactures           
sandwiches and distributes them, together with food resale products made by     
others, to convenience stores and vending machine operators.  The Company       
also sells its products to institutions such as schools and military bases.     
The Company has approximately 100 routes which service approximately 8,000      
retail accounts in the Mid-Atlantic and Western United States.  The Company     
sells its sandwiches under the Deli Dan, Audrey's Deli and Sandwich Makers brand
names.  The address of the principal executive offices of the Company is 5732   
Curlew Drive, Norfolk, Virginia  23502.                                         

AVAILABLE INFORMATION                                                           

The Company is subject to the informational requirements of the 
Securities Exchange Act of 1934 and in accordance therewith files periodic      
reports and other information with the Securities and Exchange Commission       
(the "SEC").  Such reports, proxy statements, and other information             
concerning the Company may be inspected and copies may be obtained at           
prescribed rates at the offices of the SEC, Judiciary Plaza, 450 Fifth          
Street, NW, Washington, D.C. 20549. The SEC maintains a Web site on the Internet
that contains reports, proxy and information statements and other information   
regarding the Company, the address of which is http://www.sec.gov.              

      The Company hereby undertakes to provide without charge to each person
to whom a copy of this Prospectus is delivered, upon written or oral request    
to Justin DiMacchia, Corporate Secretary, The AppleTree Companies, Inc., 5732   
Curlew Drive, Norfolk, Virginia 23502, (757)466-9200, copies of any and all     
of the information that has been incorporated by reference into this            
Prospectus, other than exhibits to such information unless such exhibits are    
specifically incorporated by reference therein.  The information relating to    
the Company contained in this Prospectus does not purport to be comprehensive   
and should be read together with the information contained in the documents     
or portions of documents incorporated by reference into this Prospectus.        

RISK FACTORS                                                                    

1.      History of Losses; Uncertainty of Future Profits; and Liquidity         
and Financing Requirements.  The Company has never realized a profit.  On       
June 2, 1996, the Company had an accumulated deficit of approximately $34.5     
million.  During the nine months and the fiscal quarter ended June 2, 1996,     
respectively, the Company had revenues of approximately $22.5 million and       
$7.3 million and incurred a loss of approximately $6.5 million and $2.5         
million.  The Company has adopted plans to reduce operating expenses and        
increased its sales revenues, but there can be no assurance as to the           
Company's earnings producing profit or that the Company will be able to         
increase its total revenues.                                                    

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        2.     Going Concern. The Company's auditors, Coopers & Lybrand, L.L.P.,
in their report included in the Company's 1995 Annual Report on Form 10-KSB,    
stated that there is "substantial doubt about the Company's ability to          
continue as a going concern."  The Company believes that if it can reflect a    
consistent trend of profitable quarters or obtain additional financing, it      
should be able to continue as a going concern.  There can be no assurance       
that any additional capital will become available to the Company on terms       
acceptable to the Company, if at all.                                           

        3.      High Level of Indebtedness and Preferred Stock.  During 1995 and
1996, the Company financed its investments and operating deficits through the   
issuance of common stock, convertible debentures, exercise of stock options,    
convertible preferred stock, and a financing arrangement with Strategica        
Capital Corporation ("Strategica"). The Strategica loan documents limit the     
Company's ability to raise new capital or engage in new financing without       
Strategica's consent.                                                           

      During February 1996, the Company issued an aggregate of $2,832,500 of
Liquidation Preference of its previously authorized preferred stock.  The       
preferred stock requires dividends to be paid in cash (or preferred stock, at   
the option of the holder) at an annual rate of 11% payable quarterly starting   
June 30, 1996; and is convertible into common stock at the option of the        
holder at a price of 50% of the bid price per share of the common stock.        

      The Company had $2,925,000 of convertible debentures outstanding as of
September 3, 1995.  During the eleven months ended July 28, 1996, the Company   
issued $2,250,000 of convertible debentures at interest rates ranging from      
prime rate plus 1% to 10%.  The Company issued 2,575 shares of the preferred    
stock in exchange for the conversion of a $2,200,000 debenture plus accrued     
interest and in exchange for cancellation of a $500,000 note plus fees and      
accrued interest and 182 shares of the preferred stock for cash of $200,000.    
The Company also issued 21,962,100 shares of common stock as satisfaction of    
other indebtedness totaling $2,556,000.  Convertible debentures totaling        
$500,000 remain outstanding.                                                    

The rights of holders of these notes, debentures and convertible
preferred stock are senior to those of common stockholders.  Further,           
documents underlying these instruments grant holders or their representatives   
the right to nominate members of the Company's board of directors and require   
holders' consent for certain financing and investing transactions.  Dividends   
on preferred stock and interest on notes and debentures may significantly       
impair the Company's cash flow.                                                 

4.      Competition.  The business in which the Company engages is highly       
competitive.  There are other companies, with resources substantially greater   
than those of the Company, which are engaged in the same business as the        
Company and in the "fast food" business which may be considered as competing    
directly with the Company.                                                      

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     5.      Credit Factor for the Purchase of Ingredients.  The Company's
inability to pay trade payables in accordance with their terms has resulted     
in the Company being placed on a cash basis with some of its suppliers.  In     
the absence of additional financing, as to which there is no assurance, and     
absent sufficient cash flow from revenues, there can be no assurance that the   
Company's vendors will grant credit terms to enable the Company to maintain     
a trade payable position which allows it to purchase ingredients for its        
sandwiches or resale products, and the Company may not be able to purchase      
ingredients or resale products in time to meet obligations imposed upon the     
Company by its customers.  This may have a material adverse effect on the       
Company's ability to profit from the sale of its manufactured or resale         
products.                                                                       

      6.      Government Regulation.  The Company is required to comply with
federal, state, and local government regulations applicable to consumer food    
service businesses generally, including those relating to the preparation and   
sale of food, minimum wage requirements, overtime, working and safety           
conditions, and environmental requirements, as well as regulations relating     
to zoning, construction, health, business licensing and employment.             
Companies involved in the manufacture, packaging and distribution of food       
items are subject to extensive regulation by various government agencies        
which, pursuant to statutes, rules and regulations, prescribe quality,          
purity, manufacturing and labeling requirements.  Food products are often       
subject to "standard identity" requirements which are promulgated at either     
the federal or state level to determine the permissible qualitative and         
quantitative ingredient content of foods.  The Company believes that it is in   
material compliance with these provisions.  Continued compliance with this      
broad federal, state and local regulatory network is essential and costly and   
the failure to comply with such regulations may have an adverse effect on the   
Company.                                                                        

       Each of the Company's manufacturing plants is subject to inspection and
regulation by federal agencies, including the FDA and the United States         
Department of Agriculture and to licensing and regulation by state and local    
health, sanitation, safety, fire and other departments.  Difficulties or        
failures in obtaining required licenses for new plants or keeping current       
licenses or approvals and to maintaining required standards, could result in    
the imposition of sanctions, including the closing of all or a portion of       
production facilities which could have material adverse effects on the          
Company and its operations.                                                     

    7.      No Continuing Contractual Relationships with Customers.  The
Company sells its products to its customers as purchase orders are placed by    
such customers.  Accordingly, there are no contractual obligations for          
business or any assurance that any of the Company's customers or suppliers      
will continue to do business with the Company.                                  

      8.      SEC Investigation. In April, 1994, the SEC initiated a private
investigation ("Investigation") of the Company (known then as Modami            
Services, Inc.) with respect to possible violations of the anti-fraud and       
reporting requirements of the federal securities laws.  There can be no         
assurance that, upon the conclusion of the Investigation, the SEC will not      
commence administrative or legal proceedings against the Company and certain    
former or present officers and directors, seeking disgorgement and other        
relief.                                                                         

 9.      No Dividends.  To date, the Company has not paid any cash
dividends on its Common Stock and does not expect to declare or pay any cash    
or other dividends in the foreseeable future.                                   

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        10.    Possible Delisting of Securities from NASDAQ System; Risks of Low
Priced Stocks.  The SEC has approved rules imposing more stringent criteria     
for listing of securities on NASDAQ.  If the Company is unable to satisfy       
NASDAQ's revised listing criteria for its Common Stock which require that the   
Company maintain total assets of at least $2,000,000, total capital and         
surplus of $1,000,000 and a minimum bid price of $1.00 (or, if the bid price    
is below $1.00, the Company must have a public float with a market value of     
at least $1,000,000 and capital and surplus of $2,000,000), its Common Stock    
will be subject to being delisted, and trading, if any, in the Common Stock     
would thereafter be conducted in the over-the-counter market on the OTC         
Bulletin Board.  Consequently, an investor may find it more difficult to        
dispose of, or to obtain accurate quotations as to the price of, the            
Company's securities.  From December 7, 1995 to March 20, 1996, the Company     
failed to meet NASDAQ's listing criteria and traded under a conditional         
listing.                                                                        

        11.     Penny Stock Regulation.  The SEC has adopted rules that regulate
broker-dealer practices in connection with transactions in a "penny stock."     
Penny stocks generally are equity securities with a price of less than $5.00    
(other than securities registered on certain national securities exchanges or   
quoted on NASDAQ, provided that current price and volume information with       
respect to transactions in such securities is provided by the exchange or       
system).  The penny stock rules require a broker-dealer, prior to a             
transaction in a penny stock not otherwise exempt from the rules, to deliver    
a standardized risk disclosure document prepared by the Commission that         
provides information about penny stocks and the nature and level of risks in    
the penny stock market.  The broker-dealer also must provide the customer       
with current bid and offer quotations for the penny stock, the compensation     
of the broker-dealer and its salesperson in the transaction, and monthly        
account statements showing the market value of each penny stock held in the     
customer's account.  The bid and offer quotations, and the broker-dealer and    
salesperson compensation information, must be given to the customer orally or   
in writing prior to effecting the transaction and must be given to the          
customer in writing before or with the customer's confirmation.  In addition,   
the penny stock rules require that prior to a transaction in a penny stock      
not otherwise exempt from such rules, the broker-dealer must make a special     
written determination that the penny stock is a suitable investment for the     
purchaser and receive the purchaser's written agreement to the transaction.     
These disclosure requirements generally have the effect of significantly        
reducing the level of trading activity in the secondary market for a security   
that becomes subject to the penny stock rules.  If the Company's securities     
become subject to the penny stock rules, investors in this Offering may find    
it more difficult to sell such securities.                                      

        12.    Dilution, Common Stock Issued in Regulation S Transactions. Since
June, 1993, the Company has sold approximately 42,000,000 shares of Common      
Stock to non-U.S. investors for an aggregate amount of approximately            
$22,000,000, reflecting purchase prices with discounts of up to 50% from the    
then prevailing market price.  The stock sold in these transactions was not     
registered in reliance on the exemption provided by Regulation S under the      
Securities Act of 1933 and the capital raised was used by the Company to fund   
operations.  The effect of these transactions has been to significantly         
dilute existing shareholder value, and this dilution has been reflected in      
the market price of the Company's Common Stock.  There can be no guarantee      
that the Company will not raise capital through additional Regulation S         
transactions or through the issuance of Common Stock in reliance on other       
exemptions from registration in the future, or that such transactions will      
not result in further dilution of the Company's existing shareholders.          

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SELLING SHAREHOLDERS                                                            

   The Selling Shareholders are named and their share holdings are set
forth in the following table, based on certain information provided to the      
Company by the Selling Shareholders.                                            

                                                        [Enlarge/Download Table]

                           Shares of                                                      
                          Common Stock                              Shares of             
                          beneficially    Percentage   Shares of   Common Stock Percentage
Name of Selling            owned as of        of     Common Stock   to be owned     of    
   Shareholder           August 30, 1996     Class      Offered   after Offering  Class   

J. Michael Reisert, Inc.   3,557,583 (1)       3.0%    3,557,583           0         0%   
Eli and Esther Shapiro       250,000 (6)        .2       250,000           0         0    
William A. Boyd            1,466,666 (7)       1.3     1,466,666           0         0    
Denis Fortin               1,183,333 (8)       1.0     1,183,333           0         0    
Lloyd B. Embry               295,833 (9)        .3       295,833           0         0    
John D. Linn                 438,666 (10)       .4       438,666           0         0    
Harold E. Blaksley           416,666 (11)       .4       416,666           0         0    
Willard D. Campbell          416,666 (12)       .4       416,666           0         0    
Robert J. and June G.                                                                     
   Becker                    541,666 (13)       .5       541,666           0         0    
Emanon Partners, L.P.      7,073,333 (14)      6.1     7,073,333           0         0    
Abraxas Partners, Ltd.       476,667 (15)       .4       476,667           0         0    
Thomas T. Grimett PA         858,334 (16)       .7       858,334           0         0    
Oscar Gruss & Son, Inc.      833,334 (17)       .7       833,334           0         0    
Michael S. O'Brien           833,334 (18)       .7       833,334           0         0    
Carl Myers                   250,000 (19)       .2       250,000           0         0    
Edwin Coyle                  160,000            .1       160,000           0         0    
Harold S. Carpenter          308,333 (20)       .3       308,333           0         0    
Seabeach & Co.            13,045,454 (21)     10.8    13,045,454           0         0    
Michael Taglich            5,679,424 (22)      4.9     5,679,424           0         0    
Robert F. Taglich          5,679,424 (23)      4.9     5,679,424           0         0    
Russell J. Redgate             2,000            0          2,000           0         0    
Joseph G. D'Amadeo            63,567            .1        63,567           0         0    
Thomas Wagner                 63,567            .1        63,567           0         0    
Michael Lauer              3,183,065 (24)      2.7     3,183,065           0         0    
Lancer Offshore, Inc.      5,928,571           5.2     5,928,571           0         0    
Lancer Partners, L.P.     31,459,530          27.3    31,459,530           0         0    
Martin Garvey                360,000 (25)       .3       360,000           0         0    
Dale Mayol                   575,000 (26)       .5       575,000           0         0    
Taglich Brothers, D'Amadeo,                                                               
   Wagner & Co.               18,000            0         18,000           0         0    
Marlowe & Company            638,161 (2)        .6       638,161           0         0    
Paul Mitchell                678,571            .6       678,571           0         0    
William Dawson                 5,000 (27)       0          5,000           0         0    
Armando Colombo               10,000 (27)       0         10,000           0         0    
Brian Hanley Rev Trust        50,000 (27)       0         50,000           0         0    
Dino S. Colombo               10,000 (27)       0         10,000           0         0    
Peter & Cathy Munro            8,000 (27)       0          8,000           0         0    
Mario Serafini                20,000 (27)       0         20,000           0         0    
Greg L. Armstrong             10,000 (27)       0         10,000           0         0    
Michael & John Alastanos JTE   4,000 (27)       0          4,000           0         0    

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William E. Guthner, Jr. Nossaman                                                          
   Guthner, Knox & Elliott                                                                
   Profit Sharing Plan #001   30,000 (27)       0         30,000           0         0    
William E. Guthner, Jr.       10,000 (27)       0         10,000           0         0    
Thomas Heil                   20,000 (27)       0         20,000           0         0    
R. Bruce Simpson Trust        10,000 (27)       0         10,000           0         0    
Stanley & Bonnie Schweiger    10,000 (27)       0         10,000           0         0    
Albert C. Korelishn           25,000 (27)       0         25,000           0         0    
David Casoria                 10,000 (27)       0         10,000           0         0    
Phil Kramer                   10,000 (27)       0         10,000           0         0    
Robert Augenti                10,000 (27)       0         10,000           0         0    
George & Mary Fanady JTWROS    6,000 (27)       0          6,000           0         0    
Richard S. Fitzgerald          6,000 (27)       0          6,000           0         0    
Kenneth H. Robertson           5,000 (27)       0          5,000           0         0    
Steven J. Colombo              4,000 (27)       0          4,000           0         0    
Cy Case                       25,000 (27)       0         25,000           0         0    
Peter & Cathrine Casoria Sr.  25,000 (27)       0         25,000           0         0    
DJP Investments                5,000 (27)       0          5,000           0         0    
Peter & Patricia Casoria, Jr. 25,000 (27)       0         25,000           0         0    
Denis Kelleher                20,000 (27)       0         20,000           0         0    
William J. Dockery IRA R/O                                                                
   Oppenheimer & Co.                                                                      
   Custodian                  50,000 (27)       0         50,000           0         0    
Helen Reisert c/f Justin                                                                  
   Reisert                     3,000 (27)       0          3,000           0         0    
Thomas L. Schroeder Trust      9,000 (27)       0          9,000           0         0    
Allan Sorensen                50,000 (27)       0         50,000           0         0    
John Becker                   10,000 (27)       0         10,000           0         0    
Robert Kennington             40,000 (27)       0         40,000           0         0    
Ronald Galowich               50,000 (27)       0         50,000           0         0    
Milton & Hoan Morris Rev.                                                                 
   Living Trust               30,000 (27)       0         30,000           0         0    
Boston Portfolio Advisors      5,000 (27)       0          5,000           0         0    
Thomas L. Schroeder SEP IRA                                                               
   Oppenheimer & Co.          40,000 (27)       0         40,000           0         0    
Crooks & Oscher              100,000 (27)       .1       100,000           0         0    
Richard Cranmer               50,000 (27)       0         50,000           0         0    
Bill Hitchcock                50,000 (27)       0         50,000           0         0    
Rich Schroeder                20,000 (27)       0         20,000           0         0    
Strategica Capital                                                                        
  Corporation             17,949,931 (3)      13.5    17,949,931           0         0    
Europe American Capital                                                                   
  Corporation             12,405,330 (4)       9.7    12,405,330           0         0    
TransAtlantic Capital                                                                     
  Corporation              3,330,495 (5)       2.8     3,330,495           0         0    

                         121,300,504          63.8%  121,300,504           0         0%   

(1)     Includes warrants to purchase 432,500 shares of the Company's Common    
Stock at an exercise price of $0.125 per share and warrants to purchase         
2,818,834 shares of the Company's Common Stock at an exercise price of          
$0.0125.                                                                        

(2)     Includes warrants to purchase 216,250 shares of the Company's Common    
Stock at an exercise price of $0.125 per share.                                 

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(3)     Consists of warrants exercisable for the purchase of shares of Common   
Stock, at a price of $0.5625 per share.                                         

(4)     Consists of shares of Common Stock which may be acquired upon conversion
of 2,030 shares of the Company's 11% Convertible Preferred Stock.               

(5)     Consists of shares of Common Stock which may be acquired upon conversion
of 545 shares of the Company's 11% Convertible Preferred Stock.                 

(6)     Includes warrants to purchase 125,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(7)     Includes warrants to purchase 633,333 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(8)     Includes warrants to purchase 350,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(9)     Includes warrants to purchase 87,500 shares of the Company's Common     
Stock at an exercise price of $0.0125 per share.                                

(10)    Includes warrants to purchase 230,333 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(11)    Includes warrants to purchase 208,333 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(12)    Includes warrants to purchase 208,333 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(13)    Includes warrants to purchase 333,333 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(14)    Includes warrants to purchase 980,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(15)    Includes warrants to purchase 70,000 shares of the Company's Common     
Stock at an exercise price of $0.0125 per share.                                

(16)    Includes warrants to purchase 441,667 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(17)    Includes warrants to purchase 416,667 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(18)    Includes warrants to purchase 416,667 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(19)    Includes warrants to purchase 125,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(20)    Includes warrants to purchase 100,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(21)    Includes warrants to purchase 6,000,000 shares of the Company's Common  
Stock at an exercise price of $0.0125 per share.                                

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(22)    Includes warrants to purchase 175,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(23)    Includes warrants to purchase 175,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(24)    Includes warrants to purchase 900,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(25)    Includes warrants to purchase 150,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(26)    Includes warrants to purchase 175,000 shares of the Company's Common    
Stock at an exercise price of $0.0125 per share.                                

(27)    Includes only warrants to purchase shares of the Company's Common Stock 
at an exercise price of $0.0125 per share.                                      

PLAN OF DISTRIBUTION                                                            

        The Shares may be sold from time to time by the Selling Shareholders, or
by pledgees, donees, transferees or other successors in interest.  Such sales   
may be made in the over-the-counter market or otherwise at prices and at        
terms then prevailing or at prices related to the then prevailing market        
price, or in negotiated transactions.  The Shares may be sold by one or more    
of the following methods: (a) block trades 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; (b)          
purchases by a broker or dealer as principal, in a market maker capacity or     
otherwise, and resale by such broker or dealer for its account pursuant to      
this Prospectus; and (c) ordinary brokerage transactions and transactions in    
which the broker solicits purchasers.  In effecting sales, brokers or dealers   
engaged by the Selling Shareholders may arrange for other brokers or dealers    
to participate.  Brokers or dealers will receive commissions or discounts       
from the Selling Shareholders in amounts to be negotiated immediately prior     
to the sale.  The Selling Shareholders, such brokers or dealers, and any        
other participating brokers or dealers may be deemed to be "underwriters"       
within the meaning of the Securities Act of 1933 (the "Act") in connection      
with such sales.  In addition, any securities covered by this Prospectus        
which qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather   
than pursuant to this Prospectus.                                               

 Upon the Company being notified by a Selling Shareholder that any
material arrangement has been entered into with a broker or dealer for the      
sale of Shares through a block trade or any other purchase by a broker or       
dealer as principal, other than a purchase as a market maker in an ordinary     
trading transaction, a supplemented prospectus will be filed, if required,      
pursuant to Rule 424 under the Act, disclosing (i) the name of such Selling     
Shareholder and of the participating brokers or dealers; (ii) the number of     
Shares involved; (iii) the price at which such Shares will be sold; (iv) the    
commission paid or discounts or concessions allowed to such brokers or          
dealers, where applicable; (v) that such brokers or dealers did not conduct     
any investigation to verify the information set forth or incorporated by        
reference in this Prospectus; and (vi) other facts material to the              
transaction.                                                                    

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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE                                 

     The following documents filed with the Commission are incorporated in
this Prospectus by reference:                                                   

      1.      The Company's Annual Report on Form 10-KSB for the fiscal year
ended September 3, 1995, Commission File No. 0-23020.                           

     2.      The Company's Quarterly Reports on Form 10-QSB for the fiscal
quarter ended December 3, 1995, for the fiscal quarter ended March              
3, 1996, and the fiscal quarter ended June 2, 1996.                             

        3.    The Company's last filed current report on Form 8-K dated February
29, 1996.                                                                       

    4.      The Company's Proxy Statement dated January 17, 1996 for its
annual meeting held on February 21, 1996.                                       

      5.      The Company's Proxy Statement dated May 13, 1996 for a special
meeting held on June 20, 1996.                                                  

All reports and other documents filed by the Company pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Securities Exchange Act of 1934,    
as amended, after the date of this Prospectus and prior to the termination of   
the Offering shall be deemed to be incorporated by reference herein and to be   
a part hereof from the date of the filing of such reports and documents.        

EXPERTS                                                                         

      The consolidated balance sheets of The AppleTree Companies, Inc. as of
September 3, 1995 and August 31, 1994 and the consolidated statements of        
operations, stockholders' equity (deficiency), and cash flows for the fifty-    
three week period ended September 3, 1995 and the year ended August 31, 1994,   
included in the Company's reports on Form 10-KSB and incorporated by            
reference in this Prospectus, have been incorporated herein in reliance on      
the report dated December 1, 1995, which includes explanatory paragraphs        
relating to an uncertainty concerning the Securities and Exchange               
Commission's order for a private investigation of the Company and certain of    
its officers and directors, and the Company's ability to continue as a going    
concern, of Coopers & Lybrand, L.L.P., independent accountants, given on the    
authority of that firm as experts in accounting and auditing.                   

Any financial statements and schedules hereafter incorporated by
reference in this prospectus that have been audited and are the subject of a    
report by independent accountants will be so incorporated by reference in       
reliance upon such reports and upon the authority of such firms as experts in   
accounting and auditing to the extent covered by consents filed with the        
Commission.                                                                     

The validity of the issuance of the securities offered hereby by the Selling    
Stockholders is being passed upon for the Company by Holland & Knight, West Palm
Beach, Florida.                                                                 

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INFORMATION NOT REQUIRED IN THE PROSPECTUS                                      

Item 14.  Other Expenses of Issuance and Distribution.          

    All expenses in connection with the issuance and distribution of the
securities being registered will be paid by the Company.  The following is an   
itemized statement of these expenses:                                           

Registration Fee       $3,346                       
Legal Fees              5,000*                      
Accounting Fees         5,000*                      
Miscellaneous             100*                      

Total          $13,446                

*Estimated                                                                      

Item 15.  Indemnification of Directors and Officers.            

    The Company is a Delaware corporation.  The Company's Certificate of
Incorporation and Bylaws permit the Board of Directors of the Company to        
authorize the indemnification of directors, officers and employees of the       
Company to the fullest extent permitted by law.  Reference is made to the       
Delaware General Corporation Law and to Section 145 thereof, which permits,     
and in some cases requires, indemnification of directors, officers, employees   
and agents of the Company under certain circumstances, subject to certain       
limitations.                                                                    

Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers or persons controlling the         
Company pursuant to the provisions described above, the Company has been        
informed that in the opinion of the SEC, such indemnification is against public 
policy as expressed in the Act and is therefore unenforceable.                  

     The Delaware General Corporation Law permits the indemnification by a
Delaware corporation of its directors, officers, employees and other agents     
against expenses (including attorneys' fees), judgments, fines and amounts      
paid in settlement in connection with specified actions, suits or               
proceedings, whether civil, criminal, administrative or investigative (other    
than derivative actions that are by or in the right of the corporation) if      
they acted in good faith and in a manner they reasonably believed to be in or   
not opposed to the best interests of the corporation, and, with respect to      
any criminal action or proceedings, had no reasonable cause to believe their    
conduct was illegal.  A similar standard of care is applicable in the case of   
derivative actions, except that indemnification extends only to expenses        
(including attorneys' fees) incurred in connection with defense or settlement   
of such an action, and court approval is required before there can be any       
indemnification if the person seeking indemnification has been found liable     
to the corporation.                                                             

      The rights of indemnification described above are not exclusive of any
other rights of indemnification to which the persons indemnified may be         
entitled under any statute, agreement, vote of shareholders or directors or     
otherwise.                                                                      

   The Company has also entered into indemnity agreements with certain
directors and officers.  The indemnity agreements in large part incorporate     
the indemnification provisions as described above.                              

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Item 16.  Exhibits.                                             

        1.      Articles of Incorporation and Amendments thereto of the Company.

    1A.     A Certificate of Designation as to 11% Convertible Preferred
Stock.                                                                          

2.      Bylaws of the Company                                   

3.      Opinion of Counsel.                                     

   4.      Consent of Coopers & Lybrand, L.L.P.  (To be provided in an
amendment to this Registration Statement at a later date.)                      

5.      Powers of Attorney.                                     

Item 17.  Undertakings.                                         

(a)     The undersigned registrant hereby undertakes:           

               (1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:                

                      (i) To include any prospectus required by Section 10(a)(3)
of the Act;                                                                     

                        (ii)    To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or the most     
recent post-effective amendment thereof) which, individually or in the          
aggregate, represent a fundamental change in the information set forth in the   
registration statement; and                                                     

                   (iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement     
or any material change to such information in the registration statement;       
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if     
the information required to be included in a post-effective amendment by        
those paragraphs is contained in periodic reports filed with the SEC by the     
registrant pursuant to section 13 or section 15(d) of the Securities Exchange   
Act of 1934 that are incorporated by reference in the registration statement.   

                (2) That, for the purpose of determining any liability under the
Act, each such 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 remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the     
termination of the offering.                                                    

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        (b)   The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the Registrant's        
annual report pursuant to section 13(a) or section 15(d) of the Securities      
Exchange Act of 1934 that is incorporated by reference in the registration      
statement 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.                   

        (c)     Insofar as indemnification for liabilities arising under 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 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 Act and      
will be governed by the final adjudication of such issue.                       

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 Norfolk, State of Virginia, on        
September 3, 1996.                                                              

                                             THE APPLETREE COMPANIES, INC.

                            By:      /s/
                                                  ------------------------------
                                               John W. Donlevy
                                           President and Chief Executive Officer

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POWER OF ATTORNEY                                                               

Each of the undersigned officers and directors of The AppleTree 
Companies, Inc. (the "Company"), a Delaware corporation, does hereby            
constitute and appoint John W. Donlevy and his substitutes, his true and        
lawful attorney in his name, place and stead, in any and all capacities, to     
sign his name to any and all amendments to this registration statement,         
including post-effective amendments, and to cause the same to be filed with     
the Securities and Exchange Commission, granting unto said attorney in fact     
full power of substitution and full power and authority to do and perform any   
act and thing necessary and proper to be done in the premises, as fully as      
the undersigned could do if personally present, and each of the undersigned     
for himself hereby ratifies and confirms all that said attorney shall           
lawfully do or cause to be done by virtue of the power of attorney granted      
hereby.                                                                         

Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the          
capacities and on the dates indicated.                                          

Signature                  Title                           Date                 

/s/                                                        September 3, 1996    
-------------------------- President, Chief                -----------------    
John W. Donlevy            Executive Officer and Director                       
   (Principal executive officer)

/s/                                                        September 3, 1996    
-------------------------- Senior Vice President,          -----------------    
Justin A. DiMacchia        Finance, Chief Financial                             
Officer and Director      
(Principal financial and  
accounting officer)       

/s/                                                        September 3, 1996    
-------------------------- Chairman of the Board of        -----------------    
Allan G. Sorensen          Directors                                            

/s/                                                        September 3, 1996    
-------------------------- Director                        -----------------    
George Kelly                                                                    

                                                       September 3, 1996
-------------------------- Director                        -----------------    
David Klarman, Esq.                                                             

/s/                                                        September 3, 1996    
-------------------------- Director                        -----------------    
Harold Rashbaum                                                                 

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EXHIBIT INDEX                                                                   

Exhibit Number     Document Description                                         

5                  Opinion of Counsel, Holland & Knight.                        

23.1               Consent of Holland & Knight (included in Exhibit             
5)                                        

23.2               Consent of Coopers & Lybrand, L.L.P. (To be                  
   provided in an amendment to this Registration
Statement at a later date.)               

24                 Power of Attorney (included on signature pages to            
registration statement)                   

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EXHIBIT 5                                                                       

September 3, 1996                                                               

Board of Directors                                                              
The AppleTree Companies, Inc.                                                   
5732 Curlew Drive                                                               
Norfolk, Virginia  23502                                                        

       We have acted as special counsel for The AppleTree Companies, Inc. (the
"Company") in connection with the filing of a Registration Statement on Form    
S-3 (the "Registration Statement") under the Act, as amended, covering the      
resale of 121,300,504 shares of common stock, par value $.001 per share (the    
"Shares"), of the Company by the holders thereof (the "Selling                  
Shareholders").  We have reviewed the corporate actions of the Company in       
connection with this matter and have examined those documents, corporate        
records, and other instruments we deemed necessary for the purpose of this      
opinion.                                                                        

Based on the foregoing, it is our opinion that:                 

        1.      The Company is a corporation duly organized and validly existing
under the laws of the State of Delaware.                                        

        2.    The Shares have been duly authorized and are legally issued, fully
paid and nonassessable.                                                         

    We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.                                                         

                                                 Very truly yours,

                                                      Holland & Knight, P.A.

                                          --------------------------------------

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EXHIBIT 23.2                                                                    

Consent of Coopers & Lybrand, L.L.P.                                            

(To be provided in an amendment to this Registration Statement at a later       
date.)                                                                          

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘S-3’ Filing	Date	First	Last	Other Filings

Filed on:	10/2/96
	9/3/96	1	19
	8/30/96	2	9
	8/29/96	3
	7/28/96	6
	6/30/96	6
	6/20/96	13		DEFS14A
	6/2/96	5	13	10QSB, 10QSB/A
	5/13/96	13
	3/20/96	8
	3/3/96	13
	2/29/96	13
	2/21/96	13
	1/17/96	13
	12/7/95	8
	12/3/95	13
	12/1/95	13
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Filing Submission 0000881106-96-000016 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Appletree Companies Inc – ‘S-3’ on 10/2/96

As of: Wednesday, 10/2/96 · Accession #: 881106-96-16 · File #: 333-13251

Registration Statement for Securities Offered Pursuant to a Transaction — Form S-3Filing Table of Contents

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Dates Referenced Herein and Documents Incorporated by Reference

Registration Statement for Securities Offered Pursuant to a Transaction — Form S-3
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