Edgar Filing: GREENMAN TECHNOLOGIES INC

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 25, 2007

Registration No. 333-_______
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
____________

FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
____________

GREENMAN TECHNOLOGIES, INC.
(Name of Small Business Issuer in its Charter)
____________

DELAWARE 71-0724248
(State or Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)

3089
(Primary Standard Industrial
Classification Code Number)

12498 Wyoming Avenue South
Savage, Minnesota, 55378
(781) 224-2411
(Address and Telephone Number of Principal Executive Offices)
____________

Charles E. Coppa
Chief Financial Officer
GreenMan Technologies, Inc.
12498 Wyoming Avenue South
Savage, Minnesota, 55378
(781) 224-2411
(Name, Address and Telephone Number of Agent for Service)
____________

Copies to:

Carl F. Barnes, Esq.
Morse, Barnes-Brown & Pendleton, P.C.
Reservoir Place
1601 Trapelo Road
Waltham, MA 02451
(781) 622-5930
____________

Approximate Date of Proposed Sale to the Public: From time to time after
the effective date of this registration statement.

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, please 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, 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 this form is a post-effective amendment filed pursuant to Rule 462(d)
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

==================================================================================================================

Title of Each Class Amount Proposed Maximum Proposed Maximum
of Securities to be to be Offering Price Aggregate Offering Amount of
Registered Registered (1) per Share (2) Price (2) Registration Fee

Common Stock 4,140,426 Shares (3) $0.43 $1,780,383.18 $190.50
==================================================================================================================

(1) In accordance with Rule 416 under the Securities Act of 1933, this
registration statement also covers any additional shares of common stock
that shall become issuable by reason of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt
of consideration that results in an increase in the number of the
outstanding shares of common stock.

(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933. For purposes of
this table, we have used the average of the high and low prices of the
registrant's common stock on January 18, 2007, on the OTC Bulletin Board.

(3) To be offered by selling stockholders. Includes 4,140,426 shares of common
stock issuable upon exercise of warrants held by selling stockholders.

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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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. THE
SELLING STOCKHOLDERS MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION
STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS
PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND THE SELLING STOCKHOLDERS
ARE NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER
OR SALE IS NOT PERMITTED.

PRELIMINARY PROSPECTUS
SUBJECT TO COMPLETION, DATED JANUARY 25, 2007

GREENMAN TECHNOLOGIES, INC.

4,140,426 Shares of Common Stock

This prospectus relates to the sale of up to 4,140,426 shares of our
common stock by some of our stockholders. For a list of the selling
stockholders, please see "Selling Stockholders." We are not selling any shares
of common stock in this offering and therefore will not receive any proceeds
from this offering. We may, however, receive proceeds upon the exercise of the
warrants registered for sale hereunder in the event that such warrants are
exercised. All costs associated with this registration will be borne by us.

These shares may be sold by the selling stockholders from time to time on
the OTC Bulletin Board or on any other national securities exchange or automated
interdealer quotation system on which our common stock is then listed or quoted,
through negotiated transactions or otherwise at market prices prevailing at the
time of sale or at negotiated prices.

Our common stock currently trades on the OTC Bulletin Board under the
symbol "GMTI." On January 18, 2007, the last reported sale price of our common
stock was $0.41 per share.

INVESTING IN OUR COMMON STOCK INVOLVES A HIGH DEGREE OF RISKS. PLEASE
REFER TO THE "RISK FACTORS" BEGINNING ON PAGE 2.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES, OR
DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

THE DATE OF THIS PROSPECTUS IS _____________, 2007.

TABLE OF CONTENTS

Prospectus Summary.......................................................... 1
Risk Factors................................................................ 2
Cautionary Statement Concerning Forward Looking Statements.................. 7
Use of Proceeds............................................................. 8
Market for Common Equity and Related Stockholder Matters.................... 8
Management's Discussion and Analysis of Financial Condition
and Results of Operations................................................ 9
Business.................................................................... 15
Management.................................................................. 21
Executive Compensation...................................................... 22
Certain Relationships and Related Transactions.............................. 26
Principal Stockholders...................................................... 28
Selling Stockholders........................................................ 30
Plan of Distribution........................................................ 31
Description of Securities................................................... 32
Commission Position on Indemnification for Securities Act Liabilities....... 34
Legal Matters............................................................... 34
Where You Can Find More Information......................................... 34
Financial Statements........................................................ F-1

-i-

PROSPECTUS SUMMARY

This summary highlights selected information from this prospectus and may
not contain all of the information that is important to an investor. We
encourage you to read this entire prospectus, including our consolidated
financial statements and the notes to our consolidated financial statements
completely and carefully before deciding whether to invest in our common stock.
You should also review the other available information referred to in the
section entitled "Where You Can Find More Information" on page 34.

Summary of our Business

GreenMan Technologies, Inc. (together with its subsidiaries "we", "us" or
"our") was originally founded in 1992 has been operated as a Delaware
corporation since 1995. Today, we comprise two operating locations that collect,
process and market scrap tires in whole, shredded or granular form. We are
headquartered in Savage, Minnesota and currently operate tire processing
operations in Iowa and Minnesota.

Our tire processing operations are paid a fee to collect, transport and
process scrap tires (i.e., collection/processing revenue) in whole or two inch
or smaller rubber chips which are then sold (i.e., product revenue).

We collect scrap tires from three sources:

o local, regional and national tire stores;

o tire manufacturing plants; and

o illegal tire piles being cleaned-up by state, county and local
governmental entities.

The tires we collect are processed and sold:

o as tire-derived fuel used in lieu of coal by pulp and paper
producers, cement kilns and electric utilities;

o as an effective substitute for crushed stone in civil engineering
applications such as road beds, landfill construction or septic
field construction; or

o as crumb rubber (rubber granules) and used for playground and
athletic surfaces, running tracks, landscaping/groundcover
applications and bullet containment systems.

Our executive offices are located at 12498 Wyoming Avenue South, Savage,
Minnesota, 55378. Our telephone number is (781) 224-2411.

The Offering

Securities Offered by
Selling Stockholders................... 4,140,426 shares of common stock issuable upon exercise of warrants
held by selling stockholders.

Offering Price......................... Determined at the time of sale by the selling stockholders.

Use of Proceeds........................ We will not receive any proceeds from the sale of the shares of common
stock by the selling stockholders. We intend to use the proceeds from
the exercise of outstanding warrants, if any, for general corporate
purposes.

Shares of Common Stock
outstanding before the offering........ 21,514,430 shares.

Risk Factors........................... An investment in the Company involves significant risks and
uncertainties. See "Risk Factors," beginning on page 2.

RISK FACTORS

An investment in our common stock involves a high degree of risk. You
should carefully consider the risks described below before deciding to purchase
shares of our common stock. If any of the events, contingencies, circumstances
or conditions described in the risks below actually occur, our business,
financial condition or results of operations could be seriously harmed. The
trading price of our common stock could, in turn, decline and you could lose all
or part of your investment.

Risks Related to Our Business

We have lost money in the last 16 consecutive quarters and may need additional
working capital if we do not return to sustained profitability, which if not
received, may force us to curtail operations.

We have incurred losses from operations over the past 16 consecutive
quarters. As of September 30, 2006, we had $639,014 in cash and cash equivalents
and a working capital deficiency of $3,989,555 of which $3,414,834 or 86% of the
total is associated with our discontinued Georgia operations. We understand our
continued existence is dependent on our ability to generate positive operating
cash flow and achieve profitable status on a sustained basis. We believe our
efforts to achieve these goals have been positively impacted by the June 30,
2006 restructuring of our credit facility with Laurus Master Fund Ltd. as well
as our divestiture of historically unprofitable operations. However, in the
fourth quarter of fiscal 2008, our principal payments due Laurus are scheduled
to increase substantially. If we are unable to obtain additional financing or
restructure our remaining principal payments with Laurus, our ability to
maintain our current level of operations could be materially and adversely
affected and we may be required to adjust our operating plans accordingly.

The delisting of our common stock by the American Stock Exchange could
substantially limit our stock's liquidity and impair our ability to raise
capital.

Our common stock ceased trading on the American Stock Exchange on June 15,
2006 and was delisted by the Exchange on July 6, 2006 as result of our failure
to maintain stockholders' equity in excess of $4 million as required by the
Exchange's Company Guide when a company has incurred losses in three of the four
most recent fiscal years. During the period of June 15 through June 20, 2006 our
stock was traded on the Pink Sheet until June 21, 2006 when we began trading on
the Over-The-Counter-Bulletin-Board under the symbol "GMTI". We believe the
delisting could substantially limit our stock's liquidity and impair our ability
to raise capital.

We have substantial indebtedness to Laurus Master Fund Ltd. secured by
substantially all of our assets. If an event of default occurs under the secured
notes issued to Laurus, Laurus may foreclose on our assets and we may be forced
to curtail or cease our operations or sell some or all of our assets to repay
the notes.

On June 30, 2006, we entered into a $16 million amended and restated
credit facility with Laurus (the "New Credit Facility"). The New Credit Facility
consists of a $5 million non-convertible secured revolving note and an $11
million secured non-convertible term note. Unlike the terms of the June 2004
credit facility with Laurus, the New Credit Facility is not convertible into
shares of our common stock.

Subject to certain grace periods, the notes and agreements provide for the
following events of default (among others):

o failure to pay interest and principal when due;

o an uncured breach by us of any material covenant, term or condition
in any of the notes or related agreements;

o a breach by us of any material representation or warranty made in
any of the notes or in any related agreement;

o any money judgment or similar final process is filed against us for
more than $50,000 that remains unvacated, unbonded or unstayed for a
period of 30 business days;

o any form of bankruptcy or insolvency proceeding is instituted by or
against us;

o suspension of our common stock from our principal trading market for
five consecutive days or five days during any ten consecutive days;
and

o the occurrence of a change in control of our ownership.

In the event of a future default under our agreements with Laurus, Laurus
may enforce its rights as a secured party and we may lose all or a portion of
our assets, be forced to materially reduce our business activities or cease
operations.

We will require additional funding to grow our business, which funding may not
be available to us on favorable terms or at all. If we do not obtain funding
when we need it, our business will be adversely affected. In addition, if we
have to sell securities in order to obtain financing, the rights of our current
holders may be adversely affected.

We will have to seek additional outside funding sources to satisfy our
future financing demands if our operations do not produce the level of revenue
we require to maintain and grow our business. We cannot assure you that outside
funding will be available to us at the time that we need it and in the amount
necessary to satisfy our needs, or, that if such funds are available, they will
be available on terms that are favorable to us. If we are unable to secure
financing when we need it, our business will be adversely affected and we may
need to discontinue some or all of our operations. If we have to issue
additional shares of common stock or securities convertible into common stock in
order to secure additional funding, our current stockholders will experience
dilution of their ownership of our shares. In the event that we issue securities
or instruments other than common stock, we may be required to issue such
instruments with greater rights than those currently possessed by holders of our
common stock.

Improvement in our business depends on our ability to increase demand for our
products and services.

Adverse events or economic or other conditions affecting markets for our
products and services, potential delays in product development, product and
service flaws, changes in technology, changes in the regulatory environment and
the availability of competitive products and services are among a number of
factors that could limit demand for our products and services.

Our business is subject to extensive and rigorous government regulation; failure
to comply with applicable regulatory requirements could substantially harm our
business.

Our tire recycling activities are subject to extensive and rigorous
government regulation designed to protect the environment. The establishment and
operation of plants for tire recycling are subject to obtaining numerous permits
and compliance with environmental and other government regulations. The process
of obtaining required regulatory approvals can be lengthy and expensive. The
Environmental Protection Agency and comparable state and local regulatory
agencies actively enforce environmental regulations and conduct periodic
inspections to determine compliance with government regulations. Failure to
comply with applicable regulatory requirements can result in, among other
things, fines, suspensions of approvals, seizure or recall of products,
operating restrictions, and criminal prosecutions. Furthermore, changes in
existing regulations or adoption of new regulations could impose costly new
procedures for compliance, or prevent us from obtaining, or affect the timing
of, regulatory approvals.

The market in which we operate is highly competitive, fragmented and
decentralized and our competitors may have greater technical and financial
resources.

The market for our services is highly competitive, fragmented and
decentralized. Many of our competitors are small regional or local businesses.
Some of our larger competitors may have greater financial and technical
resources than we do. As a result, they may be able to adapt more quickly to new
or emerging technologies and changes in customer requirements, or to devote
greater resources to the promotion and sale of their services. Competition could
increase if new companies enter the markets in which we operate or our existing
competitors expand their service lines. These factors may limit or prevent any
further development of our business.

Our success depends on the retention of our senior management and other key
personnel.

Our success depends largely on the skills, experience and performance of
our senior management. The loss of any key member of senior management could
have a material adverse effect on our business, financial condition and results
of operations.

Seasonal factors may affect our quarterly operating results.

Seasonality may cause our total revenues to fluctuate. We typically
process fewer tires during the winter and experience a more pronounced volume
reduction in severe weather conditions. In addition, a majority of our crumb
rubber is used for playground and athletic surfaces, running tracks and
landscaping/groundcover applications which are typically installed during the
warmer portions of the year. Similar seasonal or other patterns may develop in
our business.

Inflation and changing prices may hurt our business.

Generally, we are exposed to the effects of inflation and changing prices.
Primarily because the largest component of our collection and disposal costs is
transportation, we have been adversely affected by significant increases in the
cost of fuel. Additionally, because we rely on floating-rate debt for certain
financing arrangements, rising interest rates have had a negative effect on our
financial performance.

If we acquire other companies or businesses, we will be subject to risks that
could hurt our business.

A significant part of our business strategy entails future acquisitions,
or significant investments in, businesses that offer complementary products and
services. Promising acquisitions are difficult to identify and complete for a
number of reasons. Any acquisitions completed by our company may be made at a
premium over the fair value of the net assets of the acquired companies, and
competition may cause us to pay more for an acquired business than its long-term
fair market value. There can be no assurance that we will be able to complete
future acquisitions on terms favorable to us or at all. In addition, we may not
be able to integrate future acquired businesses, at all or without significant
distraction of management from our ongoing business. In order to finance
acquisitions, it may be necessary for us to issue shares of our capital stock to
the sellers of the acquired businesses and/or to seek additional funds through
public or private financings. Any equity or debt financing, if available at all,
may be on terms which are not favorable to us and, in the case of an equity
financing or the use of our stock to pay for an acquisition, may result in
dilution to our existing stockholders.

As we grow, we are subject to growth related risks.

We are subject to growth-related risks, including capacity constraints and
pressure on our internal systems and personnel. In order to manage current
operations and any future growth effectively, we will need to continue to
implement and improve our operational, financial and management information
systems and to hire, train, motivate, manage and retain employees. We may be
unable to manage such growth effectively. Our management, personnel or systems
may be inadequate to support our operations, and we may be unable to achieve the
increased levels of revenue commensurate with the increased levels of operating
expenses associated with this growth. Any such failure could have a material
adverse impact on our business, operations and prospects. In addition, the cost
of opening new facilities and the hiring of new personnel for those facilities
could significantly decrease our profitability, if the new facilities do not
generate sufficient additional revenue.

If we fail to maintain an effective system of internal controls, we may not be
able to accurately report our financial results or prevent fraud. As a result,
current and potential shareholders could lose confidence in our financial
reporting, which would harm our business and the trading price of our stock.

Effective internal controls are necessary for us to provide reliable
financial reports and effectively minimize the possibility of fraud and its
impact on our company. If we cannot continue to provide financial reports or
effectively minimize the possibility of fraud, our business reputation and
operating results could be harmed.

In addition, we will be required as currently proposed to include the
management and auditor reports on internal controls as part of our annual report
for the fiscal year ending September 30, 2008, pursuant to Section 404 of the
Sarbanes-Oxley Act of 2002, which requires, among other things, that we maintain
effective internal controls over financial reporting and procedures. In
particular, we must perform system and process evaluation and testing of our
internal controls over financial reporting to allow management and our
independent registered public accounting firm to report on the effectiveness of
our internal controls over financial reporting, as required by Section 404. Our
compliance with Section 404 will require that we incur substantial accounting
expense and expend significant management efforts.

We cannot be certain as to the timing of the completion of our evaluation
and testing, the timing of any remediation actions that may be required or the
impact these may have on our operations. Furthermore, there is no precedent
available by which to measure compliance adequacy. If we are not able to
implement the requirements relating to internal controls and all other
provisions of Section 404 in a timely fashion or achieve adequate compliance
with these requirements or other requirements of the Sarbanes-Oxley Act, we
might become subject to sanctions or investigation by regulatory authorities
such as the Securities and Exchange Commission or any securities exchange on
which we may be trading at that time, which action may be injurious to our
reputation and affect our financial condition and decrease the value and
liquidity of our common stock.

Risks Related to the Securities Market

Our stock price may be volatile, which could result in substantial losses for
our shareholders.

Our common stock is thinly traded and an active public market for our
stock may not develop. Consequently, the market price of our common stock may be
highly volatile. Additionally, the market price of our common stock could
fluctuate significantly in response to the following factors, some of which are
beyond our control:

o we are now traded on the OTC Bulletin Board;

o changes in market valuations of similar companies;

o announcements by us or by our competitors of new or enhanced
products, technologies or services or significant contracts,
acquisitions, strategic relationships, joint ventures or capital
commitments;

o regulatory developments;

o additions or departures of senior management and other key
personnel;

o deviations in our results of operations from the estimates of
securities analysts; and

o future issuances of our common stock or other securities.

We have options and warrants currently outstanding. Exercise of these options
and warrants will cause dilution to existing and new shareholders. Future sales
of common stock by Laurus and our existing stockholders could result in a
decline in the market price of our stock.

As of December 31, 2006, we had options and warrants to purchase
approximately 11,197,959 shares of common stock outstanding. The exercise of our
options and warrants will cause additional shares of common stock to be issued,
resulting in dilution to investors and our existing stockholders. As of December
31, 2006, approximately 13.6 million shares of our common stock were eligible
for sale in the public market. This represents approximately 63 percent of our
outstanding shares of common stock. After the effective date of the registration
statement of which this prospectus is a part and the issuance of the shares of
common stock registered hereunder upon the exercise of certain warrants,
approximately 20.2 million shares of our common stock will be eligible for
resale in the public market. Sales of a significant number of shares of our
common stock in the public market could result in a decline in the market price
of our common stock, particularly in light of the illiquidity and low trading
volume in our common stock.

Our directors, executive officers and principal stockholders own a significant
percentage of our shares, which will limit your ability to influence corporate
matters.

Our directors, executive officers and other principal stockholders owned
approximately 35 percent of our outstanding common stock as of December 31,
2006. Accordingly, these stockholders could have a significant influence over
the outcome of any corporate transaction or other matter submitted to our
stockholders for approval, including mergers, consolidations and the sale of all
or substantially all of our assets and also could prevent or cause a change in
control. The interests of these stockholders may differ from the interests of
our other stockholders. In addition, limited number of shares held in public
float effect the liquidity of our common stock. Third parties may be discouraged
from making a tender offer or bid to acquire us because of this concentration of
ownership.

We have never paid dividends on our capital stock, and we do not anticipate
paying any cash dividends in the foreseeable future.

We have paid no cash dividends on our capital stock to date and we
currently intend to retain our future earnings, if any, to fund the development
and growth of our businesses. In addition, our agreements with Laurus Master
Fund Ltd. prohibit the payment of cash dividends. As a result, capital
appreciation, if any, of our common stock will be shareholders' sole source of
gain for the foreseeable future.

Anti-takeover provisions in our charter documents and Delaware law could
discourage potential acquisition proposals and could prevent, deter or delay a
change in control of our company.

Certain provisions of our Restated Certificate of Incorporation and
By-Laws could have the effect, either alone or in combination with each other,
of preventing, deterring or delaying a change in control of our company, even if
a change in control would be beneficial to our stockholders. Delaware law may
also discourage, delay or prevent someone from acquiring or merging with us.

CAUTIONARY STATEMENT CONCERNING
FORWARD-LOOKING STATEMENTS

This document contains "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements are
subject to risks and uncertainties and are based on the beliefs and assumptions
of management and information currently available to management. The use of
words such as "believes," "expects," "anticipates," "intends," "plans,"
"estimates," "should," "likely" or similar expressions, indicates a
forward-looking statement.

Forward-looking statements are not guarantees of performance. They involve
risks, uncertainties and assumptions. Future results may differ materially from
those expressed in the forward-looking statements. Many of the factors that will
determine these results are beyond our ability to control or predict.
Stockholders are cautioned not to put undue reliance on any forward-looking
statements, which speak only to the date made. For those statements, we claim
the protection of the safe harbor for forward-looking statements contained in
the Private Securities Litigation Reform Act of 1995.

For a discussion of some of the factors that may cause actual results to
differ materially from those suggested by the forward-looking statements, please
read carefully the information under "Risk Factors" beginning on page 2.

The identification in this document of factors that may affect future
performance and the accuracy of forward-looking statements is meant to be
illustrative and by no means exhaustive. All forward-looking statements should
be evaluated with the understanding of their inherent uncertainty.

You may rely only on the information contained in this prospectus. We have
not authorized anyone to provide information different from that contained in
this prospectus. Neither the delivery of this prospectus nor the sale of common
stock means that information contained in this prospectus is correct after the
date of this prospectus. This prospectus is not an offer to sell or solicitation
of an offer to buy these securities in any circumstances under which the offer
or solicitation is unlawful.

USE OF PROCEEDS

We will not receive any of the proceeds from the sale of shares of common
stock in this offering. However, we may receive up to approximately $628,640
upon exercise of the outstanding warrants covered by this prospectus (assuming
that no warrant holder acquires shares by a "cashless" exercise). We intend to
use any proceeds from the exercise of warrants for working capital purposes.

MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

Our common stock traded on the American Stock Exchange from September 2002
through June 15, 2006 under the symbol "GRN." Our common stock ceased trading on
the Exchange and was delisted from the Exchange on July 6, 2006. During the
period of June 15 through June 20, 2006 our common stock traded on the Pink
Sheet, and on June 21, 2006 our stock began trading on the OTC Bulletin Board
under the symbol "GMTI". The following table sets forth the high and low bid
quotations for our common stock for the periods indicated as quoted on the
American Stock Exchange, the Pink Sheet and the OTC Bulletin Board, for these
respective periods. Quotations from the Pink Sheet and the OTC Bulletin Board
reflect inter-dealer prices, without retail mark-up, mark-down or commission and
may not necessarily represent actual transactions.

Common Stock
High Low
--------------------------------------------------------------------------------
Fiscal 2005
Quarter Ended December 31, 2004 ...................... $ 1.57 $ 1.11
Quarter Ended March 31, 2005 ......................... 1.55 0.79
Quarter Ended June 30, 2005 ......................... 0.94 0.44
Quarter Ended September 30, 2005 ..................... 0.44 0.22

Fiscal 2006
Quarter Ended December 31, 2005 ...................... $ 0.27 $ 0.15
Quarter Ended March 31, 2006 ......................... 0.32 0.14
Quarter Ended June 30, 2006 ......................... 0.57 0.23
Quarter Ending September 30, 2006 .................... 0.40 0.26

Fiscal 2007
Quarter Ending December 31, 2006 ..................... $ 0.63 $ 0.32
Quarter Ending March 31, 2007 (through
January 24, 2007) ................................. 0.42 0.33

On January 18, 2007, the closing price of our common stock was $0.41 per
share.

As of December 31, 2006, we estimate the approximate number of
stockholders of record of our common stock to be 2,200. This number excludes
individual stockholders holding stock under nominee security position listings.

Dividends

We have not paid any cash dividends on our common stock since inception
and do not anticipate declaring or paying any cash dividends in the foreseeable
future. In addition, our agreements with Laurus Master Fund, Ltd. prohibits the
payment of cash dividends. Nonetheless, the holders of our common stock are
entitled to dividends when and if declared by our board of directors from
legally available funds.

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations

In September 2005, due to the magnitude of continued operating losses, our
Board of Directors approved separate plans to divest the operations of our
Georgia and Tennessee subsidiaries and dispose of their respective assets. In
addition, due to continuing operation losses, in July 2006 we sold our
California subsidiary. Accordingly, we have classified all three respective
entity's results of operations as discontinued operations for all periods
presented in the accompanying consolidated financial statements.

Fiscal Year ended September 30, 2006 Compared to Fiscal Year ended
September 30, 2005

Net sales from continuing operations for the fiscal year ended September
30, 2006 decreased $703,650 or 4% to $17,607,812 as compared to last year's net
sales from continuing operations of $18,311,462. Our continuing operations
processed approximately 12.1 million passenger tire equivalents during the
fiscal year ended September 30, 2006, compared to approximately 14.1 million
passenger tire equivalents during the same period last year. The decrease was
attributable to the completion of an Iowa scrap tire cleanup project during
fiscal 2005 which accounted for approximately $1,188,000 of revenue and 1.25
million passenger tire equivalents during fiscal 2005.

In addition to the impact of the completion of the Iowa cleanup project in
2005, the remaining decrease in overall inbound tire volume was attributable a
corporate-wide effort initiated during fiscal 2005 to evaluate our inbound
collection infrastructure and implement price increases where warranted and
terminate service in situations where price increases were not an alternative.
While these initiatives reduced our overall inbound tire volume the overall fee
we are paid to collect and dispose of a scrap tire ("tipping fee") increased 5%
(a 6% increase when the prior year Iowa scrap tire cleanup revenue is removed)
as compared to last year. While these initiatives reduced our overall inbound
tire volume growth rate and may negatively impact our overall gross tipping fee
revenue, we believe these efforts will continue to improve our performance
through lower labor, parts and maintenance costs.

Gross profit for the fiscal year ended September 30, 2006 was $4,654,059
or 26% of net sales, compared to $3,508,828 or 19% of net sales for fiscal year
ended September 30, 2005. Our cost of sales decreased $1,848,881 or 13%
primarily due to decreased collection and processing costs associated with lower
inbound volume, reduced residual disposal costs associated with several large
civil engineering projects (which use more of the scrap tire including waste
wire) and our ongoing efforts to reduce operating costs where available.

Selling, general and administrative expenses for the fiscal year ended
September 30, 2006 increased $855,793 to $3,549,803 or 20% of net sales,
compared to $2,694,010 or 15% of net sales for the fiscal year ended September
30, 2005. The increase was primarily attributable to an increase of $343,000
(including approximately $397,000 of one-time severance costs related to our
former chief executive officer and our California divestiture in July 2006)
associated with continuing operations and the re-allocation of approximately
$571,000 of net corporate operating expenses which were absorbed by discontinued
operations in prior years.

During fiscal 2005 management determined that the carrying value of
certain transportation equipment was impaired and recorded an impairment loss
amounting to $57,183 during the fiscal year ended September 30, 2005. In
addition, due to the magnitude of our fiscal 2005 losses, management determined
that the carrying value of corporate-wide goodwill to be impaired and
accordingly wrote-off all remaining goodwill recording an additional non-cash
impairment loss of $783,410.

As a result of the foregoing, we had operating income of $1,104,256 for
the fiscal year ended September 30, 2006 as compared to an operating loss of
$25,775 for the fiscal year ended September 30, 2005.

Cash interest and financing expense for the fiscal year ended September
30, 2006 increased $1,482,578 to $2,312,071, compared to $829,493 during the
fiscal 2005. The increase is attributable to the inclusion of approximately
$888,000 of fees and expenses and $131,256 of deferred interest associated with
the June 2006 Laurus credit facility restructuring, increased rates and the

allocation of all Laurus related cash interest to continuing operations during
the fiscal year ended September 30, 2006 (approximately $127,000 was allocated
to discontinued operations during fiscal 2005). Non-cash financing fees and
interest decreased $274,549 to $1,273,014 for the fiscal year ended September
30, 2006 and as compared to $1,547,563 for the same period last year. The
decrease was attributable to the completion of all amortization of deferred
financing fees in conjunction with the June 2006 Laurus refinancing.

During the fiscal year ended September 30, 2006 we recognized
approximately $353,476 of a gain on debt restructuring associated with the June
2006 restructuring of the promissory note payable to Republic Services of
Georgia.

We recorded a provision for state income tax expense of $65,337 during the
fiscal year ended September 30, 2006 based on certain subsidiary state income
tax obligations. Based on the magnitude of our fiscal 2005 losses, we determined
the near-term realizability of a $270,000 non-cash deferred tax asset to be less
likely than not and therefore provided a valuation allowance on the entire
amount during the fiscal year ended September 30, 2005.

As a result of the foregoing, our net loss after income taxes from
continuing operations for the fiscal year ended September 30, 2006 decreased
$443,247 to $2,244,978 (including approximately $932,000 of net one-time charges
noted above) or $.11 per basic share, compared to a net loss of $2,688,225 or
$.13 per basic share for the fiscal year ended September 30, 2005.

The $1,460,981 net loss ($.08 per basic share) from discontinued
operations for the fiscal year ended September 30, 2006 includes approximately
$1 million of losses incurred by our former California subsidiary with the
balance relating primarily to the costs of exit activities associated with our
Georgia operations. The $6,518,532 net loss ($.34 per basic share) from
discontinued operations for the fiscal year ended September 30, 2005 includes
approximately $3.4 million associated with our Georgia operations, approximately
$1.8 million associated with our Tennessee operations and $1.3 million
associated with our California operations. The estimated loss on disposal of
discontinued operations for the fiscal year ended September 30, 2005 includes
approximately $1.3 million relating to our Tennessee operations and
approximately $4.6 million in connection with our Georgia facility. Losses
primarily relate to the write-off of property, equipment, goodwill, an
acquisition deposit and costs of exit activities.

Our net loss for the fiscal year ended September 30, 2006 decreased
$11,466,750 or 76% to $3,705,959 (including approximately $932,000 of net
one-time charges) or $.19 per basic share as compared to a net loss of
$15,172,709 or $.79 per basic share for the fiscal year ended September 30,
2005.

Liquidity and Capital Resources

As of September 30, 2006, we had $639,014 in cash and cash equivalents and
a working capital deficiency of $3,989,555 of which $3,414,834 or 86% of the
total is associated with our discontinued Georgia subsidiary. We understand our
continued existence is dependent on our ability to generate positive operating
cash flow and achieve profitable status on a sustained basis. We believe our
efforts to achieve these goals have been positively impacted by the June 30,
2006 restructuring of our Laurus Credit facility as well as our divestiture of
historically unprofitable operations during fiscal 2006 and 2005. However, we
believe the June 15th delisting of our stock by the American Stock Exchange
could substantially limit our stock's future liquidity and impair our ability to
raise capital. (See "Risk Factors - The delisting of our common stock by the
American Stock Exchange could substantially limit our stock's liquidity and
impair our ability to raise capital.")

The Consolidated Statements of Cash Flows reflect events in fiscal 2006
and 2005 as they affect our liquidity. During the fiscal year ended September
30, 2006, net cash provided by operating activities was $372,922. While our net
loss was $3,705,959 our overall cash flow was positively impacted by the
following non-cash expenses and changes to our working capital: $2,808,591 of
depreciation and amortization, $264,543 of non-cash impairment loss and net loss
on disposal of fixed assets and a decrease in accounts receivable and other
current assets aggregating $1,736,704 which offset a $289,603 decrease in
accounts payable. During the fiscal year ended September 30, 2005, net cash used
by operating activities was $450,536 which reflects a net loss of $15,172,709
which was partially offset by the following non-cash expenses and changes to our
working capital: $4,020,633 of depreciation and amortization, $3,618,150 of
non-cash net loss on disposal of fixed assets (including capital leases),
$3,591,077 of non-cash goodwill impairment, a decrease in accounts receivable,
product inventory and other current assets of $1,243,190 in aggregate and an
increase in accounts payable and accrued expenses of $1,938,606 in aggregate.

Net cash used for by investing activities was $863,880 for the fiscal year
ended September 30, 2006 reflecting the purchase of $1,424,212 of equipment and
the receipt of $560,332 from the sale of assets. The net cash used by investing
activities for the fiscal year ended September 30, 2005 was $987,991 reflecting
the purchase of $1,596,093 of equipment to increase capacity and efficiencies at
several of our operating locations. This was offset by proceeds received from
the sale of our Wisconsin property as our Wisconsin operations were consolidated
into Minnesota during fiscal 2005.

Net cash provided by financing activities was $764,787 during the fiscal
year ended September 30, 2006 reflecting the positive impact of the Laurus
restructuring and other notes payable and the sale of our common stock. Net cash
provided by financing activities was $1,293,956 during the fiscal year ended
September 30, 2005 and was positively impacted by availability under our new
Laurus credit facility as well as increased availability under our First
American credit facility. This increase was offset by repayment of notes payable
of $2,002,404 and capital leases of $538,848.

In order to reduce our operating costs, address our liquidity needs and
return to profitable status, we have implemented and/or are in the process of
implementing the following actions:

Divestiture of Unprofitable Operations

Due to the magnitude of the continuing operating losses incurred by our
Georgia ($3.4 million) and Tennessee ($1.8 million) subsidiaries during fiscal
2005 and our California ($3.2 million since inception) subsidiary in fiscal
2006, our Board of Directors determined it to be in the best interest of our
company to discontinue all Southeastern and West coast operations and dispose of
their respective operating assets. A majority of the Tennessee operating losses
were due to rapid market share growth within the state necessitating us to
transport an increasing number of Tennessee scrap tires to our Georgia facility
for processing at significant transportation and processing loss. A majority of
the Georgia operating losses were due to (1) the negative impact of processing a
significant number of Tennessee sourced tires; (2) a change in the
specifications of our primary end market customers requiring a smaller product
resulting in reduced processing capacity and significantly higher operating
costs; and (3) equipment reliability issues resulting from aging equipment
processing an increasing number of scrap tires. A majority of the California
operating losses were due to significantly higher operating costs and equipment
reliability issues resulting from aging equipment.

In September 2005 we assigned all Tennessee scrap tire collection
contracts and certain other contracts with suppliers of waste tires and
contracts to supply whole tires to certain cement kilns in the southeastern
region of the United States to a company owned by a former employee. We received
no cash consideration for these assignments and recorded a $1,334,849 loss
(including a non-cash loss of $918,450 associated with goodwill written off) on
disposal of the operations at September 30, 2005. The aggregate net losses
including the loss on disposal associated with the discontinued operations of
our Tennessee subsidiary included in the results for year ended September 30,
2005 were approximately $3.1 million. We accrued $165,000 of estimated costs
associated with the Tennessee closure at September 30, 2005. During fiscal 2006
we incurred and charged against the accrual approximately $109,000. In addition,
$56,000 was reversed into income as a result of a reduction in certain plant
closure accruals and an agreement with our former Tennessee landlord regarding
past due amounts. Additionally, we recognized $70,000 associated with insurance
credits. In aggregate, we recognized approximately $126,000 of income from
discontinued Tennessee operations during the year ended September 30, 2006.

In September 2005, we adopted a plan to dispose of all Georgia operations
and during the quarter ended December 31, 2005, we substantially curtailed
operations at our Georgia subsidiary. As a result, we wrote down all Georgia
operating assets to their estimated fair market value at September 30, 2005 and
recorded a loss on disposal of $4,631,102 (including a non-cash loss of
$1,253,748 associated with goodwill written off) net of a gain on settlement of
our Georgia facility lease of $586,137. We completed the divestiture of all
Georgia operating assets as of March 1, 2006. The aggregate net losses incurred
during fiscal 2006 associated with our discontinued Georgia operation was
approximately $582,000. The aggregate net losses including the loss on disposal
associated with the discontinued operations of our Georgia subsidiary included
in the results for the fiscal year ended September 30, 2005 were approximately
$8.0 million.

In February 2006, we sold and assigned to Tires Into Recycled Energy and
Supplies, Inc. ("TIRES"), a leading crumb rubber processor in the United States,
certain assets, including (a) certain truck tire processing equipment located at
our Georgia facility; (b) certain rights and interests in our contracts with
suppliers of scrap truck tires; and (c) certain intangible assets. TIRES assumed
all of our rights and obligations under these contracts. In addition, TIRES
entered into a sublease agreement with us with respect to part of the premises
located in Georgia. As additional consideration, TIRES terminated several
material supply agreements and a December 2005 letter of intent containing an
exclusive option to acquire certain operating assets of TIRES.

In March 2006, we sold and assigned to MTR of Georgia, Inc. ("MTR"), a
company co-owned by a former employee, certain assets, including (a) certain
passenger tire processing equipment located at our Georgia facility; (b) certain
rights and interests in our contracts with suppliers of scrap passenger tires;
and (c) certain intangible assets. MTR assumed all of our rights and obligations
under these contracts. In addition, MTR entered into a sublease agreement with
us with respect to part of the premises located in Georgia. We received $250,000
from MTR for these assets. As additional consideration, MTR assumed financial
responsibility for disposing of all scrap tires and scrap tire processing
residual at the Georgia facility as of the closing of this sale.

We agreed with TIRES and MTR not to compete in the business of providing
whole tire waste disposal services or selling crumb rubber material (except to
our existing customers) within certain Southeastern states for a period of three
years.

In February 2006, we amended our Georgia lease agreement to obtain the
right to terminate the original lease, which had a remaining term of
approximately 15 years, by providing the landlord with six months notice. In the
event of termination, we will be obligated to continue to pay rent until the
earlier to occur of (1) the sale by the landlord of the premises; (2) the date
on which a new tenant takes over; or (3) three years from the date on which we
vacate the property. As a result of the amendment and our decision to dispose of
our Georgia operations, we wrote off the unamortized balance of $1,427,053
associated with the leased land and buildings and improvements as a cost of
disposal of discontinued operations at September 30, 2005. This loss was
partially offset by a $586,137 gain on settlement of the remaining capital lease
obligations due and is included in the loss on disposal of discontinued
operations at September 30, 2005. In addition, on August 28, 2006 we received
notice from the Georgia landlord indicating that the Georgia subsidiary was in
default under the lease due to its insolvent financial condition. The landlord
agreed to waive the default in return for $75,000 fee to be paid upon
termination of the lease and required that all current and future rights and
obligations under the lease be assigned to GreenMan Technologies, Inc. pursuant
to a March 29, 2001 guaranty agreement. The $75,000 is included in loss from
discontinued operations for the fiscal year ended September 30, 2006 and is
included in Obligations due under lease settlement at September 30, 2006.

In July 2006 we sold our California subsidiary to a third party for
$1,000. The aggregate net losses associated with our California subsidiary
included in the results for years ended September 30, 2006 and 2005 were
approximately $1,005,000 and $1,365,000 respectively.

Credit Facility Refinancing

On June 30, 2006, we entered into a $16 million amended and restated
credit facility with Laurus (the "New Credit Facility"). The New Credit Facility
consists of a $5 million non-convertible secured revolving note and an $11
million secured non-convertible term note. Unlike our previous credit facility
with Laurus, the New Credit Facility is not convertible into shares of common
stock.

The revolving note has a term of three years from the closing, bears
interest on any outstanding amounts at the prime rate published in The Wall
Street Journal from time to time plus 2%, with a minimum rate of 8%. The amount
we may borrow at any time under the revolving note is based on our eligible
accounts receivable and our eligible inventory with an advance rate equal to 90%
of our eligible accounts receivable (90 days or less) and 50% of finished goods
inventory up to a maximum of $5 million minus such reserves as Laurus may
reasonably in its good faith judgment deem necessary and proper from time to
time. There were no amounts outstanding under the line at September 30, 2006.

The term note has a maturity date of June 30, 2009 and bears interest at
the prime rate published in The Wall Street Journal from time to time plus 2%
with a minimum rate of 8%. Interest on the loan is payable monthly commencing
August 1, 2006. Principal will be amortized over the term of the loan,
commencing on July 2, 2007, with minimum monthly payments of principal as
follows: (i) for the period commencing on July 2, 2007 through June 2008,
minimum payments of $150,000; (ii) for the period from July 2008 through June
2009, minimum payments of $400,000; and (iii) the balance of the principal shall
be payable on the maturity date. In addition, we have agreed to make an excess
cash flow repayment as follows: no later than 95 days following the end of each
fiscal year beginning with the fiscal year ending on September 30, 2007, we have
agreed to make a payment equal to 50% of (a) our aggregate net operating cash
flow generated in such fiscal year less (b) our aggregate capital expenditures
in such fiscal year (up to a maximum of 25% of the net operating cash flow
calculated in accordance with clause (a) of this sentence. The term loan maybe
prepaid at any time without penalty. We used approximately $9,972,000 of the
term loan proceeds to repay certain existing debt (including approximately $8.5
million due to Laurus) and to pay approximately $888,000 of transaction fees
associated with the New Credit Facility.

In connection with the New Credit Facility, we also issued to Laurus a
warrant to purchase up to an aggregate of 3,586,429 shares of our common stock
at an exercise price equal to $.01 per share. Laurus has agreed that it will
not, on any trading day, be permitted to sell any common stock acquired upon
exercise of this warrant in excess of 10% of the aggregate number of shares of
the common stock traded on such trading day. Previously issued warrants to
purchase an aggregate of 1,380,000 shares of our common stock were canceled as
part of these transactions. The amount of our common stock Laurus may hold at
any given time is limited to no more than 4.99% of our outstanding capital
stock. This limitation may be waived by Laurus upon 61 days notice to us and
does not apply if an event of default occurs and is continuing under the New
Credit Facility.

We have agreed to register for resale under the Securities Act of 1933 the
shares of common stock issuable to Laurus upon exercise of the new warrant.

Subject to applicable cure periods, amounts borrowed under the New Credit
Facility are subject to acceleration upon certain events of default, including:
(i) any failure to pay when due any amount we owe under the New Credit Facility;
(ii) any material breach by us of any other covenant made to Laurus; (iii) any
misrepresentation, in any material respect, made by us to Laurus in the
documents governing the New Credit Facility; (iv) the institution of certain
bankruptcy and insolvency proceedings by or against us; (v) the entry of certain
monetary judgments against us that are not paid or vacated for a period of 30
business days; (vi) suspensions of trading of our common stock; (vii) any
failure to deliver shares of common stock upon exercise of the warrant; (viii)
certain defaults under agreements related to any of our other indebtedness; and
(ix) changes of control of our company. Substantial fees and penalties are
payable to Laurus in the event of a default.

Our obligations under the New Credit Facility are secured by first
priority security interests in all of the assets of our company and all of the
assets of our GreenMan Technologies of Minnesota, Inc. and GreenMan Technologies
of Iowa, Inc. subsidiaries, as well as by pledges of the capital stock of those
subsidiaries.

Additional Steps to Increase Liquidity

Over the last several years, we have funded portions of our operating cash
flow from sales of equity securities, loans from officers and related parties,
increased borrowings and extending payments to our vendors.

In November 2000, a director loaned us $200,000 under an unsecured
promissory note which bore interest at 12% per annum with interest due monthly
and the principal due in November 2001. In June 2001 and again in June 2004, the
director agreed to extend the maturity of this note until the earlier of when
all amounts due under the Laurus credit facility have been repaid or June 30,
2007. On August 24, 2006, the director converted the $200,000 of principal and
$76,445 of accrued interest into 953,259 unregistered shares of common stock at
a price of $.29, which was the closing price of our stock on the date of
conversion.

In addition, during the period of January to June 2006, another director
loaned us $155,000 under the terms of three unsecured promissory notes which
bear interest at 10% per annum with interest with principal due during periods
ranging from June 30, 2006 through September 30, 2006. On April 12, 2006, the
director agreed in lieu of being repaid in cash at maturity to convert $76,450

(including interest of $1,450) into 273,035 shares of unregistered common stock
at a price of $.28, which was the closing price of our stock on the date of
conversion. In addition, on June 5, 2006 the director agreed to convert $15,226
(including interest of $226) into 42,295 shares of unregistered common stock at
a price of $.36, which was the closing price of our stock on the date of
conversion.

Operating Performance Enhancements

Historically, our tire shredding operations were able to recover and sell
approximately 60% of a processed tire with the balance disposed of as waste wire
residual (cross-contaminated rubber and steel) at a significant cost. During the
past several years we have purchased secondary equipment for our Iowa and
Minnesota facilities to further process the waste wire residual into saleable
components of rubber and steel that not only provide new sources of revenue but
also significantly reduced our residual disposal costs.

During the third quarter of fiscal 2006, we initiated a $950,000 equipment
upgrade to our Des Moines, Iowa processing facility installing new fine grind
crumb rubber processing equipment. The equipment became operational during
September 2006. This new equipment is expected to increase overall production
capacity by over 8 million pounds per year to over 20 million pounds of crumb
rubber capacity. Approximately $450,000 of the initiative was funded by a long
term loan from the Iowa Department of Natural Resources with the balance of the
project funded through internally generated cash flow and Iowa's line of credit.
The Iowa line of credit was subsequently paid off in conjunction with our June
2006 Laurus refinancing.

Effects of Inflation and Changing Prices

Generally, we are exposed to the effects of inflation and changing prices.
Primarily because the largest component of our collection and disposal costs is
transportation, we have been adversely affected by the significant increases in
the cost of fuel. Additionally, because we rely on floating-rate debt for
certain financing arrangements, rising interest rates have had a negative effect
on our performance.

Based on our fiscal 2007 operating plan, available working capital,
revenues from operations and anticipated availability under our working capital
line of credit with Laurus, we believe we will be able to satisfy our cash
requirements through the third quarter of fiscal 2008 at which time our Laurus
principal payments increase substantially. If we are unable to obtain additional
financing or restructure our remaining principal payments with Laurus, our
ability to maintain our current level of operations could be materially and
adversely affected and we may be required to adjust our operating plans
accordingly.

Off-Balance Sheet Arrangements

We lease various facilities and equipment under cancelable and
non-cancelable short and long term operating leases which are described in
Footnote 8 to the Audited Consolidated Financial Statements contained in this
prospectus.

BUSINESS
General

Recent Developments

On June 30, 2006, we entered into a $16 million amended and restated
credit facility with Laurus (the "New Credit Facility"). The New Credit Facility
consists of a $5 million non-convertible secured revolving note and an $11
million secured non-convertible term note. Unlike our previous credit facility
with Laurus, the New Credit Facility is not convertible into shares of common
stock.

Due to the magnitude of continued operating losses incurred by our
California subsidiary ($3.2 million since inception), our Board of Directors
determined it to be in the best interest of our company to divest our California
operations. A majority of the California operating losses were due to rapid
market share growth within the state, significantly higher operating costs and
equipment reliability issues resulting from aging equipment processing an
increasing number of scrap tires. The aggregate net losses associated with our
California subsidiary included in the results for years ended September 30, 2006
and 2005 were approximately $1,005,000 and $1,365,000 respectively.

In July 2006 we sold our California subsidiary to a third party for
$1,000. We did not recognize a material gain or loss on this transaction.

Due to the magnitude of the continuing operating losses incurred by our
Georgia ($3.4 million) and Tennessee ($1.8 million) subsidiaries during fiscal
2005, our Board of Directors determined it to be in the best interest of our
company to discontinue all Southeastern operations and dispose of their
respective operating assets. A majority of the Tennessee operating losses were
due to rapid market share growth within the state necessitating us to transport
an increasing number of Tennessee scrap tires to our Georgia facility for
processing at significant transportation and processing loss. A majority of the
Georgia operating losses were due to (1) the negative impact of processing a
significant number of Tennessee sourced tires; (2) a change in the
specifications of our primary end market customers requiring a smaller product
resulting in reduced processing capacity and significantly higher operating
costs; and (3) equipment reliability issues resulting from aging equipment
processing an increasing number of scrap tires.

us with respect to part of the premises located in Georgia. We received $250,000
from MTR for these assets. As additional consideration, MTR assumed financial
responsibility for disposing of all scrap tires and scrap tire processing
residual at the Georgia facility as of the closing of this sale. (See
"Management's Discussion and Analysis of Financial Condition and Results of
Operation - Liquidity and Capital Resources - Divestiture of Unprofitable
Operations.")

Products and Services

Our tire processing operations located in Iowa and Minnesota are paid a
fee to collect, transport and process scrap tires (i.e., collection/processing
revenue) in whole or two inch or smaller rubber chips which are then sold (i.e.,
product revenue).

We collect scrap tires from three sources:

o local, regional and national tire stores;

o tire manufacturing plants; and

o illegal tire piles being cleaned-up by state, county and local
governmental entities.

The tires we collect are processed and sold:

o as tire-derived fuel used in lieu of coal by pulp and paper
producers, cement kilns and electric utilities;

o as an effective substitute for crushed stone in civil engineering
applications such as road beds, landfill construction or septic
field construction; or

o as crumb rubber (rubber granules) and used for playground and
athletic surfaces, running tracks, landscaping/groundcover
applications and bullet containment systems.

In some states where we previously had disposal contracts with cement
kilns, our whole tire operations were paid a fee by other tire collectors to
dispose of whole tires at our location. We paid the cement kilns a fee to accept
the whole tires which they then use as an alternative fuel source to coal, while
also providing a source of iron oxide which is required in the cement making
process. As of September 30, 2006, we no longer have any disposal contracts with
cement kilns.

Manufacturing/Processing

Our tire shredding operations currently have the capacity to process about
15 million passenger tire equivalents annually. Our continuing operations
collected approximately 12.1 million passenger tire equivalents in the fiscal
year ended September 30, 2006 compared to approximately 14.1 million passenger
tire equivalents during the year ended September 30, 2005. We anticipate
processing over 12.6 million passenger tire equivalents in fiscal 2007, based on
current processing volumes.

The method used to process tires is a series of commercially available
shredders that sequentially reduce tires from whole tires to two-inch chips or
smaller. Bead-steel is removed magnetically yielding a "95% wire-free chip."
This primary recycling process recovers approximately 60% of the incoming tire.
The remaining balance consists of un-saleable cross-contaminated rubber and
steel ("waste wire"), which we have historically disposed of at significant
annual costs. Our Iowa and Minnesota facilities further process the waste wire
residual into saleable components of rubber and steel, which reduces residual
disposal costs and provides additional sources of revenue. In our Iowa facility,
rubber is further granulated into particles less than one-quarter inch in size
for use in the rapidly expanding athletic surfaces and playground markets.

Raw Materials

We believe we will have access to a supply of tires sufficient to meet our
requirements for the foreseeable future. According to the 2006 Scrap Tire and
Rubber User's Directory, in 2005 approximately 297 million passenger tire
equivalents (approximately one per person per year) were discarded in the United
States ("current generation scrap tires") in addition to an estimated several
hundred million scrap passenger tire equivalents already stockpiled in illegal
tire piles. Additionally, approximately 241 million passenger tire equivalents
are currently recycled, of which approximately 130 million are burned as
tire-derived fuel; 55 million are used in civil engineering applications; and 56
million are used in various other applications such as crumb rubber production,
retreading and export. The approximately 56 million remaining passenger tire
equivalents are now added to landfills annually. Based on this and other data,
there appears to be an adequate supply of tires to meet our needs.

Customers

Our customers continue to consist of major tire manufacturers, local and
regional tire outlets, and state and local governments. We have many long-term,
stable relationships with our customers and we do not believe that the loss of
any individual customer would have a material adverse effect on our business.
During 2006 and 2005, no single customer accounted for more than 10% of our
total net sales.

We do not have any long-term contracts which require any customer to
purchase any minimum amount of products or provide any minimum amount of tires.
There can be no assurance that we will continue to receive orders of the same
magnitude as in the past from existing customers or that we will be able to
market our current or proposed products to new customers.

Sales and Marketing

We continue to utilize in-house sales staff for securing new accounts and
marketing processed materials. This strategy maximizes revenue and concentrates
our sales/marketing efforts on highly focused initiatives. Sales/marketing
personnel have extensive experience in the tire recycling industry and in
industries where our processed materials are consumed.

Competition

We compete in a highly fragmented and decentralized market with a large
number of small competitors. Although we continue to believe there is an
opportunity for industry consolidation, we have focused our attention on
strategic value-added vertical integration. Our strategy is to continue to
increase the number of passenger tire equivalents that we processes through
aggressive sales and marketing efforts as well as continuing to focus on
identifying and generating new marketing strategies for recycled tires and their
value added by-products.

Government Regulation

Our tire recycling and processing activities are subject to extensive and
rigorous government regulation designed to protect the environment. We do not
believe that our activities result in emission of air pollutants, disposal of
combustion residues, or storage of hazardous substances except in compliance
with applicable permits and standards. The establishment and operation of plants
for tire recycling, however, are subject to obtaining numerous permits and
compliance with environmental and other government regulations. The process of
obtaining required regulatory approvals can be lengthy and expensive. The
Environmental Protection Agency and comparable state and local regulatory
agencies actively enforce environmental regulations and conduct periodic
inspections to determine compliance with government regulations. Failure to
comply with applicable regulatory requirements can result in, among other
things, fines, suspensions of approvals, seizure or recall of products,
operating restrictions, and criminal prosecutions. Furthermore, changes in
existing regulations or adoption of new regulations could impose costly new
procedures for compliance, or prevent us from obtaining, or affect the timing
of, regulatory approvals. We use our best efforts to keep abreast of changed or
new regulations for immediate implementation.

Protection of Intellectual Property Rights and Proprietary Rights

None of the equipment or machinery that we currently use or intend to use
in our current or proposed manufacturing activities is proprietary. Any
competitor can acquire equivalent equipment and machinery on the open market.

We have used the name "GreenMan" in interstate commerce since inception
and assert a common law right in and to such name.

Employees

As of December 31, 2006, we had 79 full-time employees. We are not a party
to any collective bargaining agreements and consider the relationship with our
employees to be satisfactory.

Properties

Our Minnesota location consists of production facilities and office space
situated on approximately eight acres which we lease from a related party. The
lease expires in 2016, but provides for two additional four-year extensions.
(See "Certain Relationships and Related Transactions - Related Party
Transactions.")

Our Iowa location consists of production facilities and office space
situated on approximately four acres which we lease on a triple net basis from a
related party. The lease expires in 2013 and provides us with a right of first
refusal to purchase the land and buildings at fair market value during the term
of the lease. In addition, we entered into a new lease with the same related
party for approximately three additional acres adjacent to our Iowa facility
expiring in 2013. (See "Certain Relationships and Related Transactions - Related
Party Transactions.")

In conjunction with the relocation of corporate headquarters from
Massachusetts to Minnesota we terminated our lease for our former headquarters
effective November 1, 2006. In return for the termination, we gave our landlord
$50,000 and 65,000 shares of our common stock (valued at $32,500). We are
allowed to remain in the existing space through December 31, 2006. In addition,
as part of the settlement agreement, the landlord agreed to provide us with
approximately 1,100 square feet of office space for 12 months commencing January
1, 2007 at no cost (valued at $15,000).

In September 2005, we ceased operations at our Tennessee facility and
substantially curtailed operations at our Georgia location during the quarter
ended December 31, 2005. The Tennessee lease expired in 2005. The Georgia
location consists of production facilities and office space which we lease
pursuant to an April 2001 sale/leaseback arrangement originally expiring in
2021. In February 2006, we renegotiated the lease to permit us to terminate the
lease with 180 days notice. Despite early termination, we will be obligated to
continue to pay rent until the earlier to occur of (1) the sale of the premises
by the landlord; (2) the date on which the landlord begins leasing the premises
to a new tenant; or (3) three years from the date on which we vacate the
property. (See "Certain Relationships and Related Transactions - Related Party
Transactions.")

During the period of February 16, 2006 to March 1, 2006, we completed the
sale of substantially all GreenMan of Georgia operating assets to two companies,
one of which is co-owned by a former employee. In addition, we entered into a
sublease agreement with each party with respect to part of the premises located
in Georgia with a rolling six month commitment from each party.

We consider our properties in good condition, well maintained and
generally suitable to carry on our business activities for the foreseeable
future.

Certain Legal Proceedings

As of September 30, 2006, approximately 14 vendors of our GreenMan
Technologies of Georgia, Inc. and GreenMan Technologies of Tennessee, Inc.
subsidiaries had commenced legal action, primarily in the state courts of
Georgia, in attempts to collect approximately $1.4 million of past due amounts,
plus accruing interest, attorneys' fees, and costs, all relating to various
services rendered to these subsidiaries. The largest individual claim is for
approximately $650,000. As of September 30, 2006, five vendors had secured
judgments in their favor against GreenMan Technologies of Georgia, Inc. for an
aggregate of approximately $237,000. As described above, all of GreenMan
Technologies of Tennessee, Inc.'s assets were sold in September 2005 and
substantially all of GreenMan Technologies of Georgia, Inc.'s assets were sold
as of March 1, 2006. All proceeds from these sales were retained by our secured
lender and these subsidiaries have no substantial assets. We are therefore
currently evaluating the alternatives available to these subsidiaries.

Although GreenMan Technologies, Inc. was not a party to any of these
vendor relationships, three of the plaintiffs have named GreenMan Technologies,
Inc. as a defendant along with our subsidiaries. We believe that GreenMan
Technologies, Inc. has valid defenses to these claims, as well as against any
similar or related claims that may be made against us in the future, and we
intend to defend against any such claims vigorously. In addition to the
foregoing, we are subject to routine claims from time to time in the ordinary
course of our business. We do not believe that the resolution of any of the
claims that are currently known to us will have a material adverse effect on our
company or on our financial statements.

In addition to the foregoing, we are subject to routine claims from time
to time in the ordinary course of our business. We do not believe that the
resolution of any of the claims that are currently known to us will have a
material adverse effect on our company or on our financial statements.

MANAGEMENT

Directors and Executive Officers

The following table sets forth our directors and executive officers, their
ages and the positions they hold within our company:

Name Age Position
---- --- --------

Maurice E. Needham....................... 66 Chairman of the Board of Directors
Lyle Jensen.............................. 56 Chief Executive Officer; President; Director
Charles E. Coppa......................... 43 Chief Financial Officer; Treasurer; Secretary
Dr. Allen Kahn........................... 85 Director
Lew F. Boyd.............................. 61 Director
Nicholas DeBenedictis.................... 47 Director

Each director is elected for a period of one year at the annual meeting of
stockholders and serves until his or her successor is duly elected by the
stockholders. The officers are appointed by and serve at the discretion of the
Board of Directors. During fiscal 2006, the Board agreed that each outside
director would receive $2,500 per quarter in recognition of the increased
frequency of telephonic Board meetings. Previously, outside directors received
$2,500 per meeting attended. In addition, during fiscal 2006, the Compensation
Committee agreed to discontinue future option grants made to outside directors
pursuant the Non-Employee Director Stock Option Plan.

We have established an Audit Committee consisting of Messrs. DeBenedictis
(Chair) and Boyd and Dr. Kahn, and a Compensation Committee consisting of
Messrs. Boyd (Chair) and DeBenedictis. Our Board of Directors has determined
that Mr. DeBenedictis is an "audit committee financial expert" within the
meaning given that term by Item 401(e) of Regulation S-B and that Mr.
DeBenedictis is "independent" within the meaning given to that term by Item
7(d)(3)(iv) of Schedule 14A under the Exchange Act. On April 12, 2006 Mr. Jensen
resigned as Chair of the Audit Committee and as a member of the Compensation
Committee and Mr. DeBenedictis became Chair of the Audit Committee and joined
the Compensation Committee.

Maurice E. Needham has been Chairman since June 1993. From June 1993 to
July 21, 1997, Mr. Needham also served as Chief Executive Officer. He has also
served as a Director of Comtel Holdings, an electronics contract manufacturer,
since April 1999. He previously served as Chairman of Dynaco Corporation, a
manufacturer of electronic components which he founded in 1987. Prior to 1987,
Mr. Needham spent 17 years at Hadco Corporation, a manufacturer of electronic
components, where he served as President, Chief Operating Officer and Director.

Lyle Jensen has been a Director since May 2002. On April 12, 2006, Mr.
Jensen became our President and Chief Executive Officer. Mr. Jensen previously
was Executive Vice President/Chief Operations Officer of Auto Life Acquisition
Corporation, an automotive aftermarket leader of fluid maintenance equipment.
Prior to that he was a Business Development and Operations consultant after
holding executive roles as Chief Executive Officer and minority owner of Comtel
and Corlund Electronics, Inc. He served as President of Dynaco Corporation from
1988 to 1997; General Manager of Interconics from 1984 to 1988 and various
financial and general management roles within Rockwell International from 1973
to 1984.

Charles E. Coppa has served as Chief Financial Officer, Treasurer and
Secretary since March 1998. From October 1995 to March 1998, he served as
Corporate Controller. Mr. Coppa was Chief Financial Officer and Treasurer of
Food Integrated Technologies, a publicly-traded development stage company, from
July 1994 to October 1995. Prior to joining Food Integrated Technologies, Inc.,
Mr. Coppa served as Corporate Controller for Boston Pacific Medical, Inc., a
manufacturer and distributor of disposable medical products, and Corporate
Controller for Avatar Technologies, Inc., a computer networking company.

Allen Kahn, M.D., has been a Director since March 2000. Dr. Kahn operated
a private medical practice in Chicago, Illinois, which he founded in 1953 until
his retirement in October 2002. Dr. Kahn has been actively involved as an
investor in "concept companies" since 1960. From 1965 through 1995 Dr. Kahn
served as a member of the Board of Directors of Nease Chemical Company
(currently German Chemical Company), Hollymatic Corporation and Pay Fone Systems
(currently Pay Chex, Inc.).

Lew F. Boyd has been a Director since August 1994. Mr. Boyd is the founder
and since 1985 has been the Chief Executive Officer of Coastal International,
Inc., an international business development and executive search firm,
specializing in the energy and environmental sectors. Previously, Mr. Boyd had
been Vice President/General Manager of the Renewable Energy Division of Butler
Manufacturing Corporation and had served in academic administration at Harvard
and Massachusetts Institute of Technology.

Nicholas DeBenedictis has been a Director since September 2005. Mr.
DeBenedictis has been an independent investment advisor for the past nine years
and has over 16 years of experience in the financial markets and securities
business including positions with E.W. Smith Securities, Smith Barney, and
Janney Montgomery Scott.

EXECUTIVE COMPENSATION

Executive Compensation

The following table summarizes the compensation paid or accrued for
services rendered during the fiscal years ended September 30, 2006, 2005 and
2004, to our Chief Executive Officer, our former Chief Executive Officer and our
Chief Financial Officer. We did not grant any restricted stock awards or stock
appreciation rights or make any long-term plan payouts during the periods
indicated.

Annual Compensation
-------------------
Other Annual Securities
Name and Fiscal Compen- Underlying All Other
Principal Position Year Salary Bonus sation (1) Options (2) Compensation (3)
------------------ ---- ------ ----- ---------- ----------- ----------------

Lyle Jensen,
Chief Executive Officer ..... 2006 $ 81,250 $43,000 $ 6,683 500,000 $ --

Robert H. Davis, 2006 $134,167 $ -- $13,186 -- $102,252
Chief Executive Officer 2005 230,000 -- 23,802 -- --
(Resigned April 12, 2006) ... 2004 230,000 -- 21,468 -- --

Charles E. Coppa,
Chief Financial Officer...... 2006 $145,000 $48,000 $ 8,396 137,000 $ --
2005 130,000 -- 8,396 -- --
2004 130,000 -- 22,906 60,000 --
----------
(1) Represents payments made to or on behalf of Messrs. Jensen, Davis and
Coppa for health, life and disability insurance and auto allowances.
(2) The fiscal 2006 grants represent options granted to Mr. Jensen in April
2006 and Mr. Coppa in June 2006. The fiscal 2004 grant represents options
granted to Mr. Coppa in August 2004 and were subsequently cancelled in
March 2005.
(3) The other compensation paid to Mr. Davis represents seven months of
severance payments made pursuant to an agreement under which Mr. Davis
receives twelve months salary and health insurance reimbursement
commencing May 2006 and ending April 2007.

Options/SAR Grants Table

The following table sets forth each grant of stock options made during the
year ended September 30, 2006 held by the executives named in the Summary
Compensation Table above.

Market
Number of % of Total Exercise Price
Securities Options Granted Price On Date
Underlying to Employees in Per of Grant Expiration
Name Options Granted the Fiscal Year Share Per Share Date
---- --------------- --------------- ----- --------- ----

Lyle Jensen................. 500,000 53.8% $0.28 $0.28 4/12/16
Robert H. Davis............. -- -- -- -- --
Charles E. Coppa............ 137,000 14.8% $0.36 $0.36 6/5/16

Options granted have a ten year term and vest at an annual rate of 20%
over a five-year period from the date of grant.

Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option
Values

The following table sets forth information concerning the value of
unexercised options as of September 30, 2006 held by the executives named in the
Summary Compensation Table above.

Number of Securities Value of Unexercised In-the-
Underlying Unexercised Options Money Options at
at September 30, 2006 (2) September 30, 2006
------------------------- ------------------
Shares
Acquired on Value
Name Exercise (1) Realized Exercisable Unexercisable Exercisable Unexercisable
---- ------------ -------- ----------- ------------- ----------- -------------

Lyle Jensen........... -- $ -- 28,000 505,500 $ -- $ --

Robert H. Davis....... -- -- -- -- $ -- $ --

Charles E. Coppa...... -- -- 366,000 138,500 $ -- $ --

(1) There were no options exercised during the fiscal year ended September 30,
2006.
(2) The options granted to the executive officers became exercisable
commencing February 20, 2003 in the case of Mr. Jensen and December 30,
1997 in the case of Mr. Coppa. In the case of Mr. Jensen, 6,000 options
granted under the 1996 Non-Employee Director plan vested immediately upon
grant and have a term of 10 years. All other options including those
granted to Mr. Coppa vest at an annual rate of 20% and have a 10 year
term.

Employment Agreements

On April 12, 2006, we entered into a five-year employment agreement with
Mr. Jensen pursuant to which Mr. Jensen receives a base salary of $195,000 per
year. The agreement automatically renews for one additional year upon each
anniversary, unless notice of non-renewal is given by either party. We may
terminate the agreement without cause on 30 days' prior notice. The agreement
provides for payment of twelve months' salary and certain benefits as a
severance payment for termination without cause. Any increases in Mr. Jensen's
base salary will be made in the discretion of the Board of Directors upon the
recommendation of the Compensation Committee. Mr. Jensen also received a
relocation allowance of $23,603 and receives a car allowance of $600 per month.
Mr. Jensen has been granted a qualified option under our 2005 Stock Option Plan
to purchase 500,000 shares of our common stock with an exercise price of $.28
per share. The options vest at an annual rate of 20% over a five year period
from date of grant and have a ten year term.

The agreement also provides for Mr. Jensen to be eligible to receive
incentive compensation based on (i) non-financial criteria which may be
established by the Board of Directors and (ii) upon a calculation of our annual
audited earnings before interest, taxes, depreciation and amortization
("EBITDA") as a percentage of our revenue, as follows:

EBITDA as
% of Revenue Performance Incentive
------------ ---------------------

Base: 10.0% or Less None
Level I: 10.1% - 12.0% 10% of EBITDA dollars above Base
Level II: 12.1% - 15.0% 12% of EBITDA dollars above Base
Level III: > 15.0% 15% of EBITDA dollars above Base

In fiscal 2006, Mr. Jensen received an incentive bonus of $43,000 based on
our performance from his date of hire to the fiscal year-end. In addition, Mr.
Jensen will be eligible to be awarded qualified options to purchase up to
100,000 additional shares of common stock annually, with the actual amounts
contingent on achieving certain levels of EBITDA performance. The right to
exercise all options will accelerate in full immediately prior to any
transaction or series of sequenced events in which all or substantially all of
our assets or common stock are sold to or merged with a third party or third
parties. In addition, upon signing of his employment agreement, Mr. Jensen
purchased 500,000 unregistered shares of our common stock at $.28 which was the
closing bid price of our common stock on the date the agreement was executed.

In April 1999, we entered into a three-year employment agreement with Mr.
Davis pursuant to which Mr. Davis received a salary of $230,000 per annum. The
agreement automatically renewed for three additional years upon each
anniversary, unless notice of non-renewal is given by either party, and provided
for payment of twelve months salary as a severance payment for termination
without cause. The agreement also provided for Mr. Davis to receive incentive
compensation based on the following certain financial performance measures. No
bonus was payable for fiscal 2006, 2005 or 2004. On April 12, 2006, the Board of
Directors accepted Mr. Davis's resignation as President, Chief Executive Officer
and a member of the Board of Directors. Pursuant to the terms of his employment
agreement, Mr. Davis is to receive severance of 12 months salary plus benefits
starting May 1, 2006 (valued at $260,000) plus all accrued and unpaid vacation
(valued at $40,000).

In June 1999, we entered into a two-year employment agreement with Mr.
Coppa pursuant to which Mr. Coppa received a salary of $130,000 per annum. In
July 2006, the Compensation Committee agreed to increase Mr. Coppa's base salary
to $150,000. The agreement automatically renews for two additional years upon
each anniversary, unless notice of non-renewal is given by either party. Any
increases or bonuses will be made at the discretion of our Board of Directors
upon the recommendation of the Compensation Committee. During fiscal 2006, the
Compensation Committee agreed to grant him a one-time $48,000 bonus. Mr. Coppa
used $20,000 (net of taxes) of his bonus to purchase 50,000 shares of
unregistered common stock from our company. The agreement provides for payment
of twelve months salary as a severance payment for termination without cause.

In June 2003, we entered into a three-year employment agreement with Mr.
Needham pursuant to which Mr. Needham receives a salary of $90,000 per annum. In
July 2006, Mr. Needham agreed to a 30% reduction in his base salary in
recognition of on going efforts to reduce corporate overhead. The agreement
automatically renews for three additional years upon each anniversary, unless
notice of non-renewal is given by either party. Any increases or bonuses will be
made at the discretion of our Board of Directors upon the recommendation of the
Compensation Committee. The agreement provides for payment of twelve months
salary as a severance payment for termination without cause.

Stock Option Plans

Our 1993 Stock Option Plan (the "2003 Plan") was established to provide
options to purchase shares of common stock to our employees, officers, directors
and consultants. In March 2001, our stockholders approved an increase to the
number of shares authorized under the 1993 Plan to 3,000,000 shares. The 1993
Plan expired on June 10, 2004.

On March 18, 2005, our Board of Directors adopted the 2005 Stock Option
Plan (the "2005 Plan"), which was subsequently approved by our stockholders on
June 16, 2005. The 2005 Plan replaced the 1993 Plan. In April 2004, our Board
adopted a replacement stock option plan (the "2004 Plan") but did not submit it
for ratification by our stockholders. The 2004 Plan was terminated by our Board
on March 18, 2005, and all options granted under that plan have been terminated.
Options granted under the 2005 Plan may be either options intended to qualify as
"incentive stock options" under Section 422 of the Internal Revenue Code of
1986, as amended; or non-qualified stock options.

Incentive stock options may be granted under the 2005 Plan to employees,
including officers and directors who are employees. Non-qualified options may be
granted to our employees, directors and consultants. The 2005 Plan is
administered by our Board of Directors, which has the authority to determine:

o the persons to whom options will be granted;

o the number of shares to be covered by each option;

o whether the options granted are intended to be incentive stock
options;

o the manner of exercise; and

o the time, manner and form of payment upon exercise of an option.

Incentive stock options granted under the 2005 Plan may not be granted at
a price less than the fair market value of our common stock on the date of grant
(or less than 110% of fair market value in the case of persons holding 10% or
more of our voting stock). Non-qualified stock options may be granted at an
exercise price established by our Board which may not be less than 85% of fair
market value of our shares on the date of grant. Due to the fact that current
tax laws adversely impact recipients of non-qualified stock options granted at
less than fair market value we do not expect to make such grants. Incentive
stock options granted under the 2005 Plan must expire no more than ten years
from the date of grant, and no more than five years from the date of grant in
the case of incentive stock options granted to an employee holding 10% or more
of our voting stock.

As of September 30, 2006, there were 1,032,356 options granted and
outstanding under the 1993 Plan, of which 1,022,356 options were exercisable at
prices ranging from $ .38 to $1.80. During the year ended September 30, 2006,
929,000 options were granted under the 2005 Plan at prices ranging from $.28 to
$.36. No options have been granted under the 2005 Plan as of August 31, 2006.

Non-Employee Director Stock Option Plan

Our 1996 Non-Employee Director Stock Option Plan is intended to promote
our interests by providing an inducement to obtain and retain the services of
qualified persons who are not officers or employees to serve as members of our
Board of Directors. The Board of Directors has reserved 60,000 shares of common
stock for issuance under Non-Employee Director Stock Option Plan.

Each person who was a member of the Board of Directors on January 24,
1996, and who was not an officer or employee, was automatically granted an
option to purchase 2,000 shares of common stock. In addition, after an
individual's initial election to the Board of Directors, any director who is not
an officer or employee and who continues to serve as a director will
automatically be granted on the date of the Annual Meeting of Stockholders an
additional option to purchase 2,000 shares of common stock. The exercise price
per share of options granted under the Non-Employee Director Stock Option Plan
is 100% of the fair-market value of the common stock on the business day
immediately prior to the date of the grant and each option is immediately
exercisable for a period of ten years from the date of the grant. During fiscal
2006, the Compensation Committee agreed to discontinue future option grants made
under the Non-Employee Director Stock Option Plan.

As of September 30, 2006, options to purchase 38,000 shares of our common
stock have been granted under the 1996 Non-Employee Director Stock Option Plan,
of which 28,000 are outstanding and exercisable at prices ranging from $0.38 to
$1.95.

Employee Benefit Plan

In August 1999, we implemented a Section 401(k) plan for all eligible
employees. Employees are permitted to make elective deferrals of up to 15% of
employee compensation and employee contributions to the 401(k) plan are fully
vested at all times. We may make discretionary contributions to the 401(k) plan
which become vested over a period of five years. We did not make any
discretionary contributions to the 401(k) plan during the fiscal years ended
September 30, 2006 and 2005.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Stock Issuances

During the quarter ended June 30, 2006, Mr. DeBenedictis agreed to convert
$91,676 of principal and interest due him under certain unsecured promissory
notes payable into 315,330 shares of our unregistered common stock.

During the last half fiscal 2006, Messrs. Jensen, Needham, Boyd,
DeBenedictis, Coppa and Dr. Kahn agreed to accept 231,695 shares of unregistered
common stock (valued at $82,046 at date of conversion) in lieu of cash for
certain director's fees and expenses due the individuals. In addition, on August
1, 2006, Mr. Coppa purchased 50,000 unregistered shares of common stock (valued
at $15,000 at date of purchase).

Loans

Dr. Kahn loaned us $200,000 under a November 2000 unsecured promissory
note which bears interest at 12% per annum with interest due monthly and the
principal originally due in November 2001. In June 2001, Dr. Kahn agreed to
extend the maturity date of the note for an additional twelve months from its
original maturity. In September 2002, Dr. Kahn again agreed to extend the
maturity of the note until November 2004. Dr. Kahn agreed to extend the maturity
dated several times and on August 24, 2006, Dr. Kahn agreed to convert the
$200,000 of principal and $76,445 of accrued interest into 953,259 unregistered
shares of common stock.

Between the period of June and August 2003, two immediate family members
of an officer loaned us a total of $400,000 under the terms of two-year,
unsecured promissory notes which bear interest at 12% per annum with interest
due quarterly and the principal due upon maturity. In March 2004, these same
individuals loaned us an additional $200,000 in aggregate, under similar terms
with the principal due upon maturity March 2006. These individuals each agreed
to invest the entire $100,000 principal balance of their June 2003 notes
($200,000 in aggregate) into our April 2004 private placement of investment
units and each received 113,636 units in these transactions. In addition, the
two individuals agreed to extend the maturity of the remaining balance of these
notes, $400,000 at September 30, 2006 until the earlier of when all amounts due
under the Laurus credit facility have been repaid or June 30, 2009.

In September 2003, Mr. Davis loaned us $400,000 under a September 30, 2003
unsecured promissory note which bears interest at 12% per annum with interest
due quarterly and the principal due March 31, 2004 (subsequently extended to
September 30, 2004). In 2005, Mr. Davis applied approximately $114,000 of the
balance due him plus $21,000 of accrued interest to exercise options to purchase
185,000 shares of common stock as noted above. In addition, he agreed to extend
the maturity of the remaining balance of this note until the earlier of when all
amounts due under the Laurus credit facility have been repaid or June 30, 2009.
In July 2006, Mr. Davis assigned $79,060 of the remaining balance to one of Mr.
Needham's immediate family members noted above and the remaining balance of
$20,260 plus accrued interest of $13,500 to Mr. Needham.

Between January and June 2006, Mr. DeBenedictis loaned us $155,000 under
three unsecured promissory notes which bear interest at 10% per annum with
interest and principal due during periods ranging from June 30, 2006 through
September 30, 2006. On April 12, 2006, Mr. DeBenedictis agreed in lieu of being
repaid in cash at maturity to convert $76,450 (including interest of $1,450)
into 273,035 shares of unregistered common stock at a price of $.28 which was
the closing price of our stock on the date of conversion. In addition, on June
5, 2006 Mr. DeBenedictis agreed to convert $15,226 (including interest of $226)
into 42,295 shares of unregistered common stock at a price of $.36 which was the
closing price of our stock on the date of conversion. As of September 30, 2006,
the remaining balance due on this note amounted to $65,000. Mr. DeBenedictis has
agreed be paid $10,000 per month during the quarter ended December 31, 2006 and
extend the remaining $35,000 until the earlier of when all amounts due under the
restructured Laurus credit facility have been repaid or June 30, 2009.

Related Party Transactions

We rent several pieces of equipment on a monthly basis from Valley View
Farms, Inc. and Maust Asset Management, LLC, two companies co-owned by one of
our employees. In January 2005, we entered into three equipment operating lease
agreements with Maust Asset Management. Under these leases, we are required to
pay between $1,500 and $2,683 per month rental and have the ability to purchase
the equipment at the end of the lease for between $12,000 and $16,000. Rent
expense associated with payments made to the two companies for the fiscal years
ended September 30, 2006 and 2005 was $263,801 and $170,940, respectively.

In July 2002, our Minnesota subsidiary entered into a four-year equipment
lease with Valley View Farms. Under the this lease, we were required to pay rent
of $4,394 per month until the lease termination in July 2006 at which time we
purchased the equipment for $60,000 as provided for in the lease.

During fiscal 2006, we entered into four new capital lease agreements with
Maust Asset Management for equipment valued at $423,038. We are required to pay
between $2,543 and $4,285 per month rental and have the ability to purchase the
equipment at the end of the lease for prices ranging from $11,250 to $15,000 per
unit.

In April 2003, our Iowa subsidiary entered into a ten-year lease agreement
with Maust Asset Management for our Iowa facility. Under the lease, monthly rent
payments of $8,250 plus real estate taxes are required for the first five years,
increasing to $9,000 plus real estate taxes per month for the remaining five
years. The lease also provides us a right of first refusal to purchase the land
and buildings at fair market value during the term of the lease. Maust Asset
Management acquired the property from the former lessor. In April 2005, our Iowa
subsidiary entered into an eight-year lease agreement with Maust Asset
Management for approximately three acres adjacent to our existing Iowa facility.
Under that lease, monthly rent payments of $3,500 are required. For the fiscal
years ended September 30, 2006 and 2005, payments made in connection with these
leases amounted to $163,221 and $123,000, respectively.

During March 2004, our Minnesota subsidiary sold all of its land and
buildings to an entity co-owned by one of our employees for $1,400,000,
realizing a gain of $437,337 which has been recorded as unearned income and
classified as a non current liability in the accompanying financial statements.
Simultaneous with the sale, we entered into an agreement to lease the property
back for a term of 12 years at an annual rent of $195,000, increasing to
$227,460 over the term of the lease. The gain is being recognized as income
ratably over the term of the lease. The lease provides for two additional four
year extensions. The lease is classified as a capital lease at September 30,
2006 with an equipment value of $1,400,000. For the fiscal years ended September
30, 2006 and 2005, payments made in connection with this lease amounted to
$240,672 and $236,298, respectively.

All transactions, including loans, between us and our officers, directors,
principal stockholders, and their affiliates are approved by a majority of the
independent and disinterested outside directors on the Board of Directors.
Management believes these transactions were consummated on terms no less
favorable to us than could be obtained from unaffiliated third parties.

PRINCIPAL STOCKHOLDERS

The following tables set forth certain information regarding beneficial
ownership of our common stock as of December 31, 2006:

o by each of our directors and executive officers;

o by all of our directors and executive officers as a group; and

o by each person (including any "group" as used in Section 13(d) of
the Securities Exchange Act of 1934) who is known by us to own
beneficially 5% or more of the outstanding shares of common stock.

Unless otherwise indicated below, to the best of our knowledge, all
persons listed below have sole voting and investment power with respect to their
shares of common stock, except to the extent authority is shared by spouses
under applicable law. As of December 31, 2006, 21,514,430 shares of our common
stock were issued and outstanding.

Security Ownership of Management and Directors

Number of Shares Percentage
Name (1) Beneficially Owned (2) of Class (2)
-------- ---------------------- ------------

Dr. Allen Kahn (3)................................. 4,507,602 20.78%
Maurice E. Needham (4)............................. 2,401,204 10.63%
Charles E. Coppa (5)............................... 752,928 3.44%
Nicholas DeBenedictis (6).......................... 711,306 3.31%
Lyle Jensen (7).................................... 563,022 2.61%
Lew F. Boyd (8).................................... 401,072 1.85%

All officers and directors
as a group (6 persons)............................. 9,337,134 40.10%

Security Ownership of Certain Beneficial Owners

Number of Shares Percentage
Name (1) Beneficially Owned of Class
-------- ------------------ --------

Robert H. Davis (9)................................ 703,700 3.29%
Laurus Master Fund, Ltd. (10)...................... 1,073,570 4.99%

----------
(1) Except as noted, each person's address is care of GreenMan Technologies,
Inc., 12498 Wyoming Avenue South, Savage, Minnesota, 55378.
(2) Pursuant to the rules of the Securities and Exchange Commission, shares of
common stock that an individual or group has a right to acquire within 60
days pursuant to the exercise of options or warrants are deemed to be
outstanding for the purpose of computing the percentage ownership of such
individual or group, but are not deemed to be outstanding for the purpose
of computing the percentage ownership of any other person shown in the
table.
(3) Includes 181,033 shares of common stock issuable pursuant to immediately
exercisable stock options and warrants.
(4) Includes 1,072,865 shares of common stock issuable pursuant to immediately
exercisable stock options. Also includes 59,556 shares of common stock
owned by Mr. Needham's wife.
(5) Includes 366,000 shares of common stock issuable pursuant to immediately
exercisable stock options.
(6) Includes 350,000 shares of common stock owned by Mr. DeBenedictis's wife.
(7) Includes 28,000 shares of common stock issuable pursuant to immediately
exercisable stock options.
(8) Includes 124,894 shares of common stock issuable pursuant to immediately
exercisable stock options.

(9) Mr. Davis's address is 1501 W. Gladstone Street, Azusa, California, 91702.
(10) Laurus holds warrants to purchase up to 6,000,000 shares of common stock
that are exercisable (subject to the following sentence) at an exercise
price of $.01 per share. The warrants are not exercisable, however, to the
extent that (a) the number of shares of our common stock held by Laurus
and (b) the number of shares of our common stock issuable upon exercise of
the warrant would result in beneficial ownership by Laurus of more than
4.99% of our outstanding shares of common stock. Laurus may waive these
provisions, or increase or decrease that percentage, with respect to the
warrant on 61 days' prior notice to us, or without notice if we are in
default under our credit facility. Unless and until Laurus waives these
provisions, then Laurus beneficially owns 1,073,570 shares of our common
stock issuable pursuant to underlying warrant. Laurus's address is 825
Third Avenue, 14th Floor, New York, New York 10022.

SELLING STOCKHOLDERS

The following is a list of the selling stockholders who own or who have
the right to acquire the 6,553,997 shares of common stock covered by this
prospectus. As set forth below and elsewhere in this prospectus, some of these
selling stockholders hold or within the past three years have held, a position,
office or other material relationship with us.

The following table sets forth information concerning the selling
stockholders, including:

o the number of shares currently held;

o the number of shares issuable upon conversion of notes payable and
interest;

o the number of shares issuable upon exercise of warrants;

o the number of shares offered by each selling shareholder.

We have no knowledge of the intentions of any selling shareholder to
actually sell any of the securities listed under the columns "Shares Offered."

Before Offering After Offering
------------------------------- -----------------------------
Name of Selling Number of Percentage Number of Shares Number of Percentage
Stockholder Shares Owned(1) Owned(2) Offered(3) Shares Owned(4) Owned(4)

Laurus Master Fund, Ltd. (5) ...... 1,073,570 4.99% 3,586,429 1,073,570 4.99%
Jed Schutz (6) .................... 923,328 4.29% 553,997 369,331 1.72%

----------
(1) Includes shares of common stock that the selling stockholder has the right
to acquire beneficial ownership of within 60 days.
(2) Based on 21,514,430 shares of common stock issued and outstanding on
December 31, 2006.
(3) This table assumes that each selling stockholder will sell all shares
offered for sale by it under this registration statement. Stockholders are
not required to sell their shares.
(4) Assumes that all shares of common stock registered for resale by this
prospectus have been sold.
(5) Laurus holds warrants to purchase up to 6,000,000 shares of common stock
that are exercisable (subject to the following sentence) at an exercise
price of $.01 per share. The warrants are not exercisable, however, to the
extent that (a) the number of shares of our common stock held by Laurus
and (b) the number of shares of our common stock issuable upon exercise of
the warrants would result in beneficial ownership by Laurus of more than
4.99% of our outstanding shares of common stock. Laurus may waive these
provisions, or increase or decrease that percentage, with respect to the
warrant on 61 days' prior notice to us, or without notice if we are in
default under our credit facility. Unless and until Laurus waives these
provisions, then Laurus beneficially owns 1,073,570 shares of our common
stock issuable pursuant to underlying warrant. Details of the transaction
under which Laurus acquired this warrant are provided under "Liquidity and
Capital Resources - Credit Facility Refinancing."
(6) Includes 369,331 shares of common stock and 553,997 shares of common stock
which may be acquired upon exercise of warrants.

PLAN OF DISTRIBUTION

We are registering the shares of common stock on behalf of the selling
stockholders. As used in this prospectus, "selling stockholders" includes the
pledges, donees, transferees or others who may later hold the selling
stockholders' interests. We have agreed to pay the costs and fees of registering
the shares, but the selling stockholders will pay any brokerage commissions,
discounts or other expenses relating to the sale of the shares, including
attorneys' fees.

The stockholders and any of their pledgees, assignees and
successors-in-interest may, from time to time, sell any or all of their shares
of common stock on any stock exchange, market or trading facility on which the
shares are traded or in private transactions. These sales may be at fixed or
negotiated prices. The stockholders may use any one or more of the following
methods when selling shares:

o ordinary brokerage transactions and transactions in which the broker
dealer solicits purchasers;

o block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;

o purchases by a broker-dealer as principal and resale by the broker
dealer for its account;

o an exchange distribution in accordance with the rules of the
applicable exchange;

o privately negotiated transactions;

o settlement of short sales;

o broker-dealers may agree with the stockholders to sell a specified
number of such shares at a stipulated price per share;

o a combination of any such methods of sale; and

o any other method permitted pursuant to applicable law.

The stockholders may also sell shares under Rule 144 under the Securities
Act, if available, rather than under this prospectus.

Broker-dealers engaged by the stockholders may arrange for other brokers
dealers to participate in sales. Broker-dealers may receive commissions or
discounts from the stockholders (or, if any broker-dealer acts as agent for the
purchaser of shares, from the purchaser) in amounts to be negotiated. The
stockholders do not expect these commissions and discounts to exceed what is
customary in the types of transactions involved.

The stockholders may from time to time pledge or grant a security interest
in some or all of the shares of common stock owned by them and, if they default
in the performance of their secured obligations, the pledgees or secured parties
may offer and sell the shares of common stock from time to time under this
prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or
other applicable provision of the Securities Act of 1933 amending the list of
stockholders to include the pledgee, transferee or other successors in interest
as stockholders under this prospectus.

The stockholders and any broker-dealers or agents that are involved in
selling the shares may be deemed to be "underwriters" within the meaning of the
Securities Act in connection with such sales. In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act.

We are required to pay all fees and expenses incident to the registration
of the shares. We have agreed to indemnify the stockholders against certain
losses, claims, damages and liabilities, including liabilities under the
Securities Act.

DESCRIPTION OF SECURITIES

Our authorized capital stock consists of 41,000,000 shares, consisting of
40,000,000 shares of common stock, par value $.01 per share, and 1,000,000
shares of preferred stock, par value $.01 per share. Our board of directors may
designate the rights and preferences of one or more series of preferred stock.
Preferred stock could be used, under certain circumstances, as a way to
discourage, delay or prevent a takeover of the Company. See "Anti-Takeover
Provisions." As of December 31, 2006, we had 21,514,430 shares of common stock
issued and outstanding and no shares of preferred stock outstanding.

Common Stock

Under our Certificate of Incorporation, shares of our common stock are
identical in all respects, and each share entitles the holder to the same rights
and privileges as are enjoyed by other holders and is subject to the same
qualifications, limitations and restrictions as apply to other shares.

Holders of our common stock are entitled to one vote for each share held
of record on all matters submitted to a vote of the stockholders. Holders of our
common stock do not have cumulative voting rights. Accordingly, subject to the
voting rights of holders of any preferred stock that may be issued, holders of a
plurality of our common stock present at a meeting at which a quorum is present
are able to elect all of the directors eligible for election. The holders of a
majority of the voting power of our issued and outstanding capital stock
constitutes a quorum.

The holders of our common stock are entitled to dividends when and if
declared by our board of directors from legally available funds. The holders of
our common stock are also entitled to share pro rata in any distribution to
stockholders upon our liquidation or dissolution.

None of the shares of our common stock:

o have preemptive rights;

o are redeemable;

o are subject to assessments or further calls;

o have conversion rights; or

o have sinking fund provisions.

Preferred Stock

Our Board of Directors may, without further action of our stockholders,
issue up to 1,000,000 shares of preferred stock in one or more classes and one
or more series and fix the number of shares constituting any such class or
series. The Board of Directors may fix the rights and preferences of any such
class or series, including dividend rights, dividend rates, conversion rights,
voting rights, terms of redemption (including sinking fund provisions), maturity
dates, redemption prices and liquidation preferences. The rights of the holders
of common stock will be subject to, and may be adversely affected by, the rights
of holders of any Preferred Stock that may be issued in the future. Issuance of
Preferred Stock could have the effect of making it more difficult for a third
party to acquire, or of discouraging a third party from acquiring, a majority of
the outstanding voting stock of our company. There are currently no shares of
Preferred Stock outstanding.

Anti-Takeover Provisions

Certain provisions, described below, of our Certificate of Incorporation
and By-Laws, and Section 203 of the General Corporation Law of the State of
Delaware (discussed below), could have the effect, either alone or in
combination with each other, of delaying, deferring or preventing a change in
control of our company.

Our By-Laws provide that special meetings of stockholders may be called
only by the our Board of Directors, our Chairman of the Board, our President or
the holders of at least 10% of the shares entitled to vote at such a meeting.
Moreover, the business permitted to be conducted at any meeting of stockholders
is limited to matters relating to the purpose or purposes stated in the notice
of meeting and to matters brought before the meeting by the Board of Directors
or the presiding officer of the meeting. Advance notice of stockholder
nominations for directors and any other stockholder proposals to be brought
before meetings of stockholders is required to be given in writing to our
Secretary within the time periods and following the procedures set forth in our
By-Laws.

Our Certificate of Incorporation includes a provision eliminating the
liability of its directors to our company or to our stockholders for monetary
damages for breaches of fiduciary duty by such directors, to the extent
permitted by Delaware law. In addition, the Certificate of Incorporation
contains provisions providing for the indemnification of our officers and
directors to the maximum extent permitted by Delaware law from expenses,
judgments, fines and amounts paid in settlement actually and reasonably incurred
by such persons by reason of their being officers or directors. Our By-Laws
provide that our directors may be removed, with or without cause, only with the
vote of the holders of at least 66-2/3% of the shares of our capital stock
issued and outstanding and entitled to vote at an election of directors, and
provides that any director elected by a particular class or series of stock may
be removed without cause only by vote of the holders of a majority of the
outstanding shares of such class or series. These provisions could have the
effect of delaying a change in control of our company even if the holders of a
majority (but less than 66-2/3%) of our voting securities desire such a change.

Our By-Laws require a vote of the holders of at least 66-2/3% of the
shares our capital stock issued and outstanding and entitled to vote in order to
alter, amend or repeal, or make any new By-Laws inconsistent with, Article I
(governing certain rights of our stockholders, including the rights to call
meetings of stockholders and to make stockholder proposals at meetings) and
Article II (governing the activities of our directors, including the removal of
members of the Board). These supermajority voting provisions for changes by
stockholders affecting Articles I or II of the By-Laws do not affect the ability
of our Board of Directors to amend either of these sections.

Section 203 of Delaware General Corporation Law

We are subject to Section 203 of the General Corporation Law of the State
of Delaware ("Section 2003"), which generally prohibits any Delaware corporation
that has a class of securities listed on a national securities exchange or more
than 2,000 stockholders of record from engaging in a "business combination" with
an "interested stockholder" for a period of three years after the date of the
transaction in which the person becomes an interested stockholder, unless either
(i) the interested stockholder obtains the approval of the Board of Directors
prior to becoming an interested stockholder, (ii) the interested stockholder
owned 85% of the outstanding voting stock of the corporation (excluding shares
held by certain affiliates of the corporation) at the time he became an
interested stockholder or (iii) the business combination is approved by both the
Board of Directors and the holders of two-thirds of the outstanding voting stock
of the corporation (excluding shares held by the interested stockholder), voting
at an annual or special meeting of the stockholders and not acting by written
consent. An "interested stockholder" generally is a person who, together with
affiliates and associates, owns (or at any time within the prior three years did
own) 15% or more of the corporation's outstanding voting stock. A "business
combination" includes mergers, consolidations, stock sales, asset sales and
other transactions involving the corporation or any direct or indirect
majority-owned subsidiary of the corporation that results in a financial benefit
to the interested stockholder.

This need to acquire consent of our Board of Directors and/or stockholders
for Section 203 purposes imposes a substantial burden on a potential acquiror
and could therefore act as an anti-takeover device.

Transfer Agent

The transfer agent for our common stock is American Stock Transfer & Trust
Company, located at 59 Maiden Lane, Plaza Level, New York, NY 10038. American
Stock Transfer & Trust Company's telephone number is (800) 937-5449.

COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

Our certificate of incorporation provides that we shall indemnify our
directors and officers to the fullest extent permitted by Delaware law and that
none of our directors will be personally liable to our company or our
stockholders for monetary damages for breach of fiduciary duty as a director,
except for liability:

o for any breach of the director's duty of loyalty to our Company or
our stockholders;

o for acts or omissions not in good faith or that involve intentional
misconduct or a knowing violation of the law;

o under section 174 of the Delaware General Corporation Law for the
unlawful payment of dividends; or

o for any transaction from which the director derives an improper
personal benefit.

These provisions require us to indemnify our directors and officers unless
restricted by Delaware law and eliminate our rights and those of our
stockholders to recover monetary damages from a director for breach of his
fiduciary duty of care as a director except in the situations described above.
The limitations summarized above, however, do not affect our ability or that of
our stockholders to seek non-monetary remedies, such as an injunction or
rescission, against a director for breach of his fiduciary duty.

Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to our directors, officers and controlling persons pursuant
to the foregoing provisions, we have 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.

LEGAL MATTERS

The validity of the shares of common stock being offered hereby will be
passed upon for us by Morse, Barnes-Brown & Pendleton, P.C., Waltham,
Massachusetts.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports and other information with
the SEC. You may read and copy any reports, statements or other information we
file at the SEC's public reference rooms in Washington D.C., New York, New York
and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our filings are also available to the
public from commercial document retrieval services and at the web site
maintained by the SEC at http://www.sec.gov.

We have filed a registration statement on Form SB-2 under the Securities
Act with the SEC covering the common stock to be offered by the selling
stockholders. As permitted by the rules and regulations of the SEC, this
document does not contain all information set forth in the registration
statement and exhibits thereto, all of which are available for inspection as set
forth above. For further information, please refer to the registration
statement, including the exhibits thereto. Statements contained in this document
relating to the contents of any contract or other document referred to herein
are not necessarily complete, and reference is made to the copy of that contract
or other document filed as an exhibit to the registration statement or other
document, and each statement of this type is qualified in all respects by that
reference.

No person is authorized to give any information or make any representation
not contained in this document. You should not rely on any information provided
to you that is not contained in this document. This prospectus does not
constitute an offer to sell or a solicitation of an offer to purchase the
securities described herein in any jurisdiction in which, or to any person to
whom, it is unlawful to make the offer or solicitation. Neither the delivery of
this document nor any distribution of shares of common stock made hereunder
shall, under any circumstances, create any implication that there has not been
any change in our affairs as of any time subsequent to the date hereof.

INDEX TO FINANCIAL STATEMENTS

Page
----

Report of Independent Registered Public Accounting Firm F-2

Consolidated Balance Sheets as of September 30, 2006 and 2005 F-3

Consolidated Statements of Operations for the Years Ended
September 30, 2006 and 2005 F-4

Consolidated Statements of Changes in Stockholders' Deficit for the
Years Ended September 30, 2006 and 2005 F-5

Consolidated Statements of Cash Flows for the Years Ended
September 30, 2006 and 2005 F-6

Notes to Consolidated Financial Statements for the Years Ended
September 30, 2006 and 2005 F-8

F-1

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders
GreenMan Technologies, Inc.
Savage, Minnesota

We have audited the accompanying consolidated balance sheets of GreenMan
Technologies, Inc. and subsidiaries as of September 30, 2006 and 2005 and the
related consolidated statements of operations, changes in stockholders' deficit
and cash flows for the years then ended. These consolidated financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our
audits.

We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of GreenMan Technologies, Inc.
and subsidiaries as of September 30, 2006 and 2005 and the results of their
operations and their cash flows for the years then ended in conformity with
accounting principles generally accepted in the United States of America.

/S/ WOLF & COMPANY, P.C.
----------------------------
WOLF & COMPANY, P.C

Boston, Massachusetts
December 12, 2006.

F-2

GreenMan Technologies, Inc.
Consolidated Balance Sheets

September 30, September 30,
2006 2005
------------ ------------

ASSETS
Current assets:
Cash and cash equivalents ......................................................... $ 639,014 $ 255,657
Accounts receivable, trade, less allowance for doubtful accounts of $185,206 and
$110,115 as of September 30, 2006 and September 30, 2005 ....................... 2,056,928 2,337,038
Product inventory ................................................................. 113,336 144,928
Other current assets .............................................................. 653,423 564,620
Assets related to discontinued operations ......................................... 7,291 2,776,485
------------ ------------
Total current assets ........................................................ 3,469,992 6,078,728
------------ ------------
Property, plant and equipment, net .................................................. 5,807,119 5,512,227
------------ ------------
Other assets:
Deferred loan costs ............................................................... -- 430,158
Customer relationship intangibles, net ............................................ 85,434 92,383
Other ............................................................................. 146,982 62,360
Assets related to discontinued operations ......................................... -- 944,096
------------ ------------
Total other assets .......................................................... 232,416 1,528,997
------------ ------------
$ 9,509,527 $ 13,119,952
============ ============

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable, current ............................................................ $ 493,572 $ 763,058
Notes payable, line of credit ..................................................... -- 619,950
Notes payable, related party, current ............................................. 30,000 --
Convertible notes payable, current ................................................ -- 1,305,361
Convertible notes payable, line of credit ......................................... -- 3,585,281
Accounts payable .................................................................. 1,786,130 1,909,315
Accrued expenses, other ........................................................... 1,549,071 1,004,711
Obligations under capital leases, current ......................................... 185,940 153,104
Liabilities related to discontinued operations .................................... 3,414,834 5,405,833
------------ ------------
Total current liabilities ................................................... 7,459,547 14,746,613
Notes payable, related parties, non-current portion ............................... 534,320 699,320
Notes payable, non-current portion ................................................ 10,339,590 1,883,742
Convertible notes payable, non-current portion .................................... -- 1,802,896
Obligations under capital leases, non-current portion ............................. 1,615,692 1,298,266
Deferred gain on sale leaseback transaction ....................................... 343,185 379,633
Obligations due under lease settlement ............................................ 630,000 --
Liabilities related to discontinued operations .................................... -- 995,653
------------ ------------
Total liabilities ........................................................... 20,922,334 21,806,123
------------ ------------

Stockholders' deficit:
Preferred stock, $1.00 par value, 1,000,000 shares authorized, none outstanding ... -- --
Common stock, $.01 par value, 40,000,000 shares authorized, 21,408,966 shares
and 19,225,352 shares issued and outstanding at September 30, 2006 and 2005 .... 214,089 192,253
Additional paid-in capital ........................................................ 35,811,086 34,853,599
Accumulated deficit ............................................................... (47,437,982) (43,732,023)
------------ ------------
Total stockholders' deficit ................................................. (11,412,807) (8,686,171)
------------ ------------
$ 9,509,527 $ 13,119,952
============ ============

See accompanying notes to consolidated financial statements.

F-3

GreenMan Technologies, Inc.
Consolidated Statements of Operations

Years Ended September 30,
2006 2005
------------ ------------

Net sales ...................................................... $ 17,607,812 $ 18,311,462
Cost of sales .................................................. 12,953,753 14,802,634
------------ ------------
Gross profit ................................................... 4,654,059 3,508,828
Operating expenses:
Selling, general and administrative ........................ 3,549,803 2,694,010
Impairment loss - goodwill ................................. -- 783,410
Impairment loss - long lived assets ........................ -- 57,183
------------ ------------
3,549,803 3,534,603
------------ ------------
Operating income (loss) from continuing operations ............. 1,104,256 (25,775)
------------ ------------
Other income (expense):
Interest and financing expense ............................. (2,312,071) (829,493)
Non-cash interest and financing costs ...................... (1,273,014) (1,547,563)
Other, net ................................................. 307,701 (13,484)
(Loss) gain on disposal of assets, net ..................... (6,513) 2,835
------------ ------------
Other (expense), net ................................... (3,283,897) (2,387,705)
------------ ------------
Loss from continuing operations before income taxes ............ (2,179,641) (2,413,480)
Provision for income taxes ..................................... (65,337) (274,745)
------------ ------------
Loss from continuing operations ................................ (2,244,978) (2,688,225)
------------ ------------
Discontinued operations:
Loss on disposal of discontinued operations ................ -- (5,965,952)
Loss from discontinued operations .......................... (1,460,981) (6,518,532)
------------ ------------
(1,460,981) (12,484,484)
------------ ------------
Net loss ....................................................... $ (3,705,959) $(15,172,709)
============ ============

Loss from continuing operations per share - basic .............. $ (0.11) $ (0.14)
Loss on disposal of discontinued operations per share - basic .. -- (0.31)
Loss from discontinued operations per share - basic ............ (0.08) (0.34)
------------ ------------
Net loss per share - basic ..................................... $ (0.19) $ (0.79)
============ ============

Weighted average shares outstanding ............................ 19,810,585 19,188,674
============ ============

See accompanying notes to consolidated financial statements.

F-4

GreenMan Technologies, Inc.
Consolidated Statements of Changes in Stockholders' Deficit
Years Ended September 30, 2006 and 2005

Additional
Common Stock Paid In Accumulated
Shares Amount Capital Deficit Total
--------------------- ----------- ------------ ------------

Balance, September 30, 2004 .......... 19,072,963 $190,729 $31,755,384 $(28,559,314) $ 3,386,799
Common stock issued in connection
with a potential acquisition ...... 127,389 1,274 198,726 -- 200,000
Beneficial conversion discount on
convertible notes payable ......... -- -- 2,879,989 -- 2,879,989
Common stock issued upon conversion
of notes payable .................. 25,000 250 19,500 -- 19,750
Net loss for the year ended
September 30, 2005 ................ -- -- -- (15,172,709) (15,172,709)
---------- -------- ----------- ------------ ------------
Balance, September 30, 2005 .......... 19,225,352 $192,253 $34,853,599 $(43,732,023) $ (8,686,171)
Sale of common stock ................. 550,000 5,500 149,500 -- 155,000
Net value of warrants issued in
conjunction with debt
restructuring ..................... -- -- 344,155 -- 344,155
Common stock issued upon conversion
of interest and principal ......... 1,268,589 12,686 355,436 -- 368,122
Common stock issued for fees and
expenses due ...................... 231,695 2,317 79,729 -- 82,046
Common stock issued for
services rendered ................. 133,330 1,333 28,667 -- 30,000
Net loss for the year ended
September 30, 2006 ................ -- -- -- (3,705,959) (3,705,959)
---------- -------- ----------- ------------ ------------
Balance, September 30, 2006 .......... 21,408,966 $214,089 $35,811,086 $(47,437,982) $(11,412,807)
========== ======== =========== ============ ============

See accompanying notes to consolidated financial statements

F-5

GreenMan Technologies, Inc.
Consolidated Statements of Cash Flows

Years Ended September 30,
2006 2005
------------ ------------

Cash flows from operating activities:
Net loss .......................................................................... $ (3,705,959) $(15,172,709)
Adjustments to reconcile net income to net cash provided by operating activities:
Increase in valuation allowance on deferred tax asset ............................. -- 270,000
Loss on disposal of property, plant and equipment ................................. 264,543 3,618,150
Gain recognized on debt restructuring ............................................. (353,476) --
Gain on capital lease settlement, net ............................................. -- (552,137)
Impairment loss ................................................................... -- 3,591,077
Depreciation ...................................................................... 1,522,880 2,425,801
Amortization of non-cash financing costs .......................................... 1,272,874 1,547,562
Amortization of customer relationships ............................................ 12,837 47,270
Gain on sale leaseback ............................................................ (36,445) (39,482)
Loss on stock deposit ............................................................. -- 200,000
Decrease (increase) in assets:
Accounts receivable ........................................................... 1,590,857 261,900
Product inventory ............................................................. (23,523) 494,796
Other current assets .......................................................... 145,847 486,494
Other assets .................................................................. (84,622) 432,136
Increase (decrease) in liabilities:
Accounts payable .............................................................. (289,603) 1,366,876
Accrued expenses .............................................................. 56,712 571,730
------------ ------------
Net cash provided by operating activities .................................. 372,922 (450,536)
------------ ------------
Cash flows from investing activities:
Purchase of property and equipment ................................................ (1,424,212) (1,596,093)
Proceeds on sale of property and equipment ........................................ 116,000 608,102
Proceeds from equipment held for sale ............................................. 444,332 --
------------ ------------
Net cash used for investing activities ....................................... (863,880) (987,991)
------------ ------------
Cash flows from financing activities:
Increase in deferred financing costs .............................................. -- (60,209)
Net advances under line of credit ................................................. (619,950) 119,950
Proceeds from notes payable ....................................................... 11,692,579 492,643
Proceeds from notes payable, related parties ...................................... 155,000 --
Repayment of notes payable ........................................................ (3,713,644) (1,502,404)
Proceeds from convertible notes payable ........................................... -- 1,000,000
Repayment of convertible notes payable ............................................ (3,108,257) (500,000)
Net (payments) advances on convertible notes payable, line of credit , net ........ (3,585,281) 2,282,824
Principal payments on obligations under capital leases ............................ (195,660) (538,848)
Net proceeds on the sale of common stock .......................................... 140,000 --
------------ ------------
Net cash provided by financing activities .................................... 764,787 1,293,956
------------ ------------
Net increase (decrease) in cash and cash equivalents .................................. 273,829 (144,571)
Cash and cash equivalents at beginning of year, including $109,559 and $48,113,
respectively, of cash related to discontinued operations ........................... 365,216 509,787
------------ ------------
Cash and cash equivalents at end of year, including $31 and $109,559, respectively,
of cash related to discontinued operations ......................................... $ 639,045 $ 365,216
============ ============

See accompanying notes to consolidated financial statements

F-6

GreenMan Technologies, Inc.
Consolidated Statements of Cash Flows

Years Ended September 30,
2006 2005
---------- ----------

Supplemental cash flow information:
Machinery and equipment acquired under capital leases .............................. $ 535,686 $ 478,476
Transfer of equipment held for resale .............................................. -- 539,332
Beneficial conversion discount recognized on convertible debt ...................... -- 2,879,979
Net value of warrants issued ....................................................... 344,156 --
Shares issued upon conversion of convertible notes payable, related party
and accrued interest ............................................................ 368,121 19,750
Shares issued in lieu of cash for fees, incentives, expenses and service rendered .. 127,046 --
Accounts receivable offset in connection with sale of discontinued operations ...... 152,000
Accounts payable offset with proceeds on sale of discontinued operations ........... 247,000
Capital lease net settlement ....................................................... -- 700,000
Shares issued to acquire exclusive purchase option ................................. -- 200,000
Equipment acquired through transfer of deposits .................................... -- 247,874
Interest paid ...................................................................... 1,238,375 1,360,447
Taxes paid ......................................................................... 28,809 --

See accompanying notes to consolidated financial statements.

F-7

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

1. Summary of Significant Accounting Policies

Basis of Presentation

The consolidated financial statements include the accounts of GreenMan
Technologies, Inc. and our wholly-owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated in consolidation.

In September 2005, due to the magnitude of continued operating losses, our
Board of Directors approved separate plans to divest the operations of our
Georgia and Tennessee subsidiaries and dispose of their respective assets. In
addition, due to continuing operation losses, in July 2006 we sold our 100%
ownership interest in our California subsidiary. Accordingly, we have classified
all three respective entities' assets, liabilities and results of operations as
discontinued operations for all periods presented in the accompanying
consolidated financial statements.

Reclassification

Certain amounts in the 2005 financial statements have been reclassified to
conform with 2006 presentation.

Nature of Operations, Risks, and Uncertainties

As of September 30, 2006, we had $639,014 in cash and cash equivalents and
a working capital deficiency of $3,989,555 of which $3,414,834 or 86% of the
total is associated with our discontinued Georgia subsidiary. We understand our
continued existence is dependent on our ability to generate positive operating
cash flow and achieve profitable status on a sustained basis. We believe our
efforts to achieve these goals have been positively impacted by the June 30,
2006 restructuring of our Laurus Credit facility (see Note 5) and our
divestiture of historically unprofitable operations during fiscal 2006 and 2005
(see Note 2). However, in the fourth quarter of fiscal 2008, our principal
payments due Laurus are scheduled to increase substantially. If we are unable to
obtain additional financing or restructure our remaining principal payments with
Laurus, our ability to maintain our current level of operations could be
materially and adversely affected and we may be required to adjust our operating
plans accordingly. We believe the June 15, 2006 delisting of our stock by the
American Stock Exchange as a result of our noncompliance with their minimum
stockholders' equity requirement of $4 million (for companies incurring losses
in three of there four most recent fiscal years) could substantially limit our
stock's future liquidity and impair our ability to raise capital.

We have invested substantial amounts of capital during the past several
years, including approximately $950,000 in Iowa during our fourth quarter in new
equipment to increase processing capacity at our Iowa and Minnesota locations,
as well as consolidating our Wisconsin location into our Minnesota operations
during fiscal 2005 to substantially reduce operating costs and maximize our
return on assets. Our future operating plan focuses on maximizing the
performance of these two operations through our continuing efforts to increase
overall quality of revenue (revenue per passenger tire equivalent) while
remaining diligent with our ongoing cost reduction initiatives. During fiscal
2005, we completed an evaluation of our corporate-wide inbound collection
infrastructure and determined that we would no longer provide certain levels of
service and products at existing rates in certain markets and therefore
implemented price increases where warranted and terminated service in situations
where price increases were not an alternative. As a result, we experienced a 4%
increase in overall tipping fees (fees we are paid to collect and dispose of a
scrap tire) during fiscal 2005 and an increase of 5% during fiscal 2006 as
compared to the same period during fiscal 2005. While these initiatives reduced
our overall inbound tire volume growth rate during fiscal 2005 and thus far
during fiscal 2006, we believe they have and will continue to improve our
performance through lower labor, parts and maintenance costs. In addition, we
continue to identify, and are currently selling product into several new,
higher-value markets as evidenced by an 18% increase in end product revenue
during fiscal 2005 and consistent end product revenue in fiscal 2006. We
continue to experience strong demand for our end products.

Nature of Operations, Risks, and Uncertainties

GreenMan Technologies, Inc. (together with its subsidiaries "we", "us" or
"our") was originally founded in 1992 and has been operated as a Delaware
corporation since 1995. Today, we comprise three operating locations that
collect, process and market scrap tires in whole, shredded or granular form. We
are headquartered in Savage, Minnesota and currently operate tire processing
operations in Iowa and Minnesota.

Management Estimates

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the amounts of revenues and expenses recorded during the
reporting period. Actual results could differ from those estimates. Such
estimates relate primarily to the estimated lives of property and equipment
other intangible assets, the valuation reserve on deferred taxes, the value of
our lease settlement obligation and the value of equity instruments issued. The
amount that may be ultimately realized from assets and liabilities could differ
materially from the values recorded in the accompanying financial statements as
of September 30, 2006.

F-8

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

1. Summary of Significant Accounting Policies - (Continued)

In particular, discontinued operations included management's best estimate
of the amounts to be realized and liabilities to be incurred in connection with
the discontinuing of our Georgia operation. The amounts we may ultimately
realize could differ materially from the amounts estimated in arriving at the
loss on disposal of the discontinued operations.

Cash Equivalents

Cash equivalents include short-term investments with original maturities
of three months or less.

Accounts Receivable

Accounts receivable are carried at original invoice amount less an
estimate made for doubtful accounts. Management determines the allowance for
doubtful accounts by regularly evaluating past due individual customer
receivables and considering a customer's financial condition, credit history,
and the current economic conditions. Individual accounts receivable are written
off when deemed uncollectible, with any future recoveries recorded as income
when received.

Product Inventory

Inventory consists primarily of crumb rubber and is valued at the lower of
cost or market on the first-in first-out (FIFO) method.

Property, Plant and Equipment

Property, plant and equipment are stated at cost. Depreciation and
amortization expense is provided on the straight-line method. Expenditures for
maintenance, repairs and minor renewals are charged to expense as incurred.
Significant improvements and major renewals that extend the useful life of
equipment are capitalized.

Deferred Loan Costs

Deferred loan costs are amortized into interest expense over the life of
the related financing arrangement and represent costs incurred in connection
with financing at the corporate level and our wholly-owned subsidiary in Iowa.

Revenue Recognition

We have two sources of revenue: processing revenue which is earned from
the collection, transportation and processing of scrap tires and product revenue
which is earned from the sale of tire chips, crumb rubber and steel. Revenues
from product sales are recognized when the products are shipped and
collectability is reasonably assured. Revenues derived from the collection,
transporting and processing of tires are recognized when processing of the tires
has been completed.

Income Taxes

Deferred tax assets and liabilities are recorded for temporary differences
between the financial statement and tax bases of assets and liabilities using
the currently enacted income tax rates expected to be in effect when the taxes
are actually paid or recovered. A deferred tax asset is also recorded for net
operating loss and tax credit carry forwards to the extent their realization is
more likely than not. The deferred tax expense for the period represents the
change in the net deferred tax asset or liability from the beginning to the end
of the period.

Stock-Based Compensation

Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation", encourages all entities to adopt a fair value based
method of accounting for employee stock compensation plans, whereby compensation
cost is measured at the grant date based on the value of the award and is
recognized over the service period, which is usually the vesting period.
However, SFAS No. 123, as amended by SFAS No. 123(R), amended, discussed below
allows us until October 1, 2006, to continue to measure compensation cost of
those plans using the intrinsic value based method of accounting prescribed by
Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees", whereby compensation cost is the excess, if any, of the quoted
market price of the stock at the grant date (or other measurement date) over the
amount an employee must pay to acquire the stock. Stock options issued under our
stock option plans generally have no intrinsic value at the grant date, and
under Accounting Principles Board Opinion No. 25 no compensation cost is
recognized for them. We apply Accounting Principles Board Opinion No. 25 and
related interpretations in accounting for stock options issued to to our
employees and directors. Had the compensation cost for the stock options issued

F-9

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

1. Summary of Significant Accounting Policies - (Continued)

to our employees and directors been determined based on the fair value at the
grant dates consistent with Statement of Financial Accounting Standards No. 123,
the net loss and net loss per share would have been adjusted to the pro forma
amounts indicated below:

Year Ended Year Ended
September 30, September 30,
2006 2005
----------- ------------

Net loss as reported .............................. $(3,705,959) $(15,172,709)
Add: Compensation recognized under APB No. 25 .... -- --
Less: Compensation recognized under FAS 123 ....... (12,012) (52,306)
----------- ------------
Pro forma net loss ................................ $(3,717,971) $(15,225,015)
=========== ============

Net loss per share:
Basic and diluted - as reported ................ $ (0.19) $ (0.79)
=========== ============
Basic and diluted - pro forma .................. $ (0.19) $ (0.79)
=========== ============

The fair value of each option grant during the year ended September 30,
2006 under the 2005 Stock Option Plan was estimated on the date of grant using
the Black-Scholes option-pricing model with the following weighted average
assumptions; dividend yield of 0%; risk-free interest rates of approximately
4.9%; expected volatility ranging from 78% to 103% and expected life of 5 years.

The fair value of each option grant during the year ended September 30,
2005 under the 1996 Non-Employee Director Stock Option Plan was estimated on the
date of grant using the Black-Scholes option-pricing model with the following
weighted average assumptions; dividend yield of 0%; risk-free interest rates of
4.5%; expected volatility of 57% and expected life of 5 years.

Intangible Assets

In accordance with SFAS No. 142, "Goodwill and Other Intangible Assets",
we review intangibles for impairment annually, or more frequently if an event
occurs or circumstances change that would more likely than not reduce the fair
value of our intangible assets below their carrying value.

Intangible assets include customer relationships acquired in current or
past business acquisitions which are being amortized on a straight-line basis
over a period of ten to twenty years, commencing on the date of the acquisition.
The impairment test for customer relationships requires us to review original
relations for continued retention. Amortization expense associated with customer
relationships amounted to $12,837 and $47,266 (including $22,653 of impairment
charges) for the fiscal years ended September 30, 2006 and 2005 respectively.
Accumulated amortization was $53,567 and $77,544 at September 30, 2006 and 2005,
respectively. Amortization of customer relationships is expected to be $6,950
per year during the next five years.

Due to our decision to dispose of our Georgia and Tennessee operations at
September 30, 2005, goodwill associated with these operations totaling
$2,172,198 was written off as part of the loss on disposal of such discontinued
operations during the fourth quarter. In addition, due to the magnitude of the
resultant fiscal 2005 losses, management determined in the fourth quarter that
the carrying value of corporate-wide goodwill was impaired at September 30, 2005
and accordingly wrote-off all remaining goodwill recording a non-cash impairment
loss of $1,361,696, including $578,287 related to our California operations.

Long-Lived Assets

In accordance with Statement of Financial Accounting Standards ("SFAS")
No. 144 "Accounting for The Impairment or Disposal of Long Lived Assets",
long-lived assets to be held and used are analyzed for impairment whenever
events or changes in circumstances indicate the carrying amount of an asset may
not be recoverable. SFAS No. 144 relates to assets that can be amortized and the
life can be determinable. We evaluate at each balance sheet date whether events
and circumstances have occurred that indicate possible impairment. If there are
indications of impairment, we use future undiscounted cash flows of the related
asset or asset grouping over the remaining life in measuring whether the assets
are fully recoverable. In the event such cash flows are not expected to be
sufficient to recover the recorded asset values, the assets are written down to
their estimated fair value. Long-lived assets to be disposed of are reported at
the lower of carrying amount or fair value of asset less the cost to sell.

F-10

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

1. Summary of Significant Accounting Policies - (Continued)

Net Income Loss Per Share

Basic earnings per share represents income available to common
stockholders divided by the weighted average number of common shares outstanding
during the period. Diluted earnings per share reflects additional common shares
that would have been outstanding if potentially dilutive common shares had been
issued, as well as any adjustment to income that would result from the assumed
conversion. Potential common shares that may be issued by us relate to
outstanding stock options and warrants (determined using the treasury stock
method) and convertible debt. Basic and diluted net loss per share are the same
for the years ended September 30, 2006 and 2005, since the effect of the
inclusion of all outstanding options, warrants and convertible debt would be
anti-dilutive.

New Accounting Pronouncements

SFAS 123(R) - In December 2004, the Financial Accounting Standards Board
("FASB") issued SFAS No. 123(R) (revised 2004), Share-Based Payment, which is a
revision of SFAS No. 123, Accounting for Stock-Based Compensation. SFAS No.
123(R) supersedes APB Opinion No. 25, Accounting for Stock Issued to Employees,
and amends SFAS No. 95, Statement of Cash Flows. Generally, the approach in SFAS
No. 123(R) is similar to the approach described in SFAS No. 123. However, SFAS
No. 123(R) requires all share-based payments to employees, including grants of
employee stock options, to be recognized in the income statement based on their
fair values. Pro forma disclosure is not an alternative. SFAS No. 123(R) must be
adopted no later than the first interim period for fiscal years beginning after
December 15, 2005. We adopted SFAS No. 123(R) effective on October 1, 2006.

SFAS No. 123(R) permits public companies to adopt its requirements using
one of two methods: a "modified prospective" approach or a "modified
retrospective" approach. Under the modified prospective approach, compensation
cost is recognized beginning with the effective date based on the requirements
of SFAS 123(R) for all share-based payments granted after the effective date and
the requirements of SFAS No. 123(R) for all awards granted to employees prior to
the effective date of SFAS No. 123(R) that remain unvested on the effective
date. The modified retrospective approach includes the requirements of the
modified prospective approach but also permits entities to restate based on the
amounts previously recognized under SFAS No. 123 for purposes of pro forma
disclosures either for all prior periods presented or prior interim periods of
the year of adoption. We are evaluating which method to adopt.

As permitted by SFAS No. 123, we currently account for the share-based
payments to employees using APB Opinion No. 25's intrinsic value method and, as
such, generally recognizes no compensation cost for employee stock options.
However, grants of stock to employees have always been recorded at fair value as
required under existing accounting standards. We do not expect the adoption of
SFAS No. 123(R) to have a material effect on our results of operations. However,
our results of operations could be materially affected by share-based payments
issued after the adoption of SFAS 123(R). The impact of the adoption of SFAS No.
123(R) cannot be predicted at this time because it will depend on levels of
share-based payments granted in the future. The unamortized compensation costs
in connection with stock option grants prior to September 30, 2006 was $117,690.

SFAS No. 123(R) also requires the benefits of tax deductions in excess of
recognized compensation cost to be reported as a financing cash flow, rather
than an operating cash flow under current accounting literature. Since we do not
have the benefit of tax deductions in excess of recognized compensation cost,
because of our net operating loss position, the change will have no immediate
impact on the consolidated financial statements.

SFAS No. 154 - In May 2005, FASB issued SFAS No. 154 "Accounting Changes
and Error Corrections", to amend Opinion 20 and FASB No. 3 and changes the
requirements for the accounting for and reporting of a change in accounting
principle. This Statement provides guidance on the accounting for and reporting
of accounting changes and error corrections. It establishes, unless
impracticable, retrospective application as the required method for reporting a
change in accounting principle in the absence of explicit transition

F-11

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

1. Summary of Significant Accounting Policies - (Continued)

requirements specific to the newly adopted accounting principle. This Statement
also provides guidance for determining whether retrospective application of a
change in accounting principle is impracticable and for reporting a change when
retrospective application is impracticable. The correction of an error in
previously issued financial statements is not an accounting change. However, the
reporting of an error correction involves adjustments to previously issued
financial statements similar to those generally applicable to reporting an
accounting change retrospectively. Therefore, the reporting of a correction of
an error by restating previously issued financial statements is also addressed
by this Statement. The effective date for accounting changes and correction of
errors made in fiscal years beginning after December 15, 2005. This
pronouncement is not expected to have a material effect on our financial
statements.

SFAS No. 155 - In February 2006, FASB issued SFAS No. 155, "Accounting for
Certain Hybrid Financial Instruments" as an amendment to SFAS No. 133 and 140.
This Statement:

a. Permits fair value re-measurement for any hybrid financial instrument
that contains an embedded derivative that otherwise would require
bifurcation;

b. Clarifies which interest-only strips and principal-only strips are not
subject to the requirements of Statement 133;

c. Establishes a requirement to evaluate interests in securitized
financial assets to identify interests that are freestanding derivatives
or that are hybrid financial instruments that contain an embedded
derivative requiring bifurcation;

d. Clarifies that concentrations of credit risk in the form of
subordination are not embedded derivatives; and

e. Amends Statement 140 to eliminate the prohibition on a qualifying
special-purpose entity from holding a derivative financial instrument that
pertains to a beneficial interest other than another derivative financial
instrument.

This Statement is effective for all financial instruments acquired or
issued after the beginning of an entity's first fiscal year that begins after
September 15, 2006. We do not expect the adoption of SFAS 155 to have a material
effect on our consolidated financial position or results of operations.

SFAS No. 157 - In September 2006, the FASB issued SFAS No. 157, "Fair
Value Measurement" ("SFAS 157"). SFAS 157 defines fair value, establishes a
framework for measuring fair value and expands disclosures about fair value
measurements. SFAS 157 is effective for financial statements issued for fiscal
years beginning after November 17, 2007 and interim periods within those fiscal
years. We are evaluating the impact of adopting SFAS 157 on our consolidated
financial position, results of operations and cash flows.

FIN No. 48 - In July 2006, the FASB issued Interpretation No. 48,
"Accounting for Uncertain Tax Positions"; an Interpretation of SFAS No. 109
("FIN 48"), which clarifies the criteria for recognition and measurement of
benefits from uncertain tax positions. Under FIN 48, an entity should recognize
a tax benefit when it is "more-likely-than-not", based on the technical merits,
that the position would be sustained upon examination by a taxing authority. The
amount to be recognized, given the "more likely than not" threshold was passed,
should be measured as the largest amount of tax benefit that is greater than 50
percent likely of being realized upon ultimate settlement with a taxing
authority that has full knowledge of all relevant information. Furthermore, any
change in the recognition, derecognition or measurement of a tax position should
be recognized in the interim period in which the change occurs. We do not expect
the adoption of FIN 48 to have a material effect on our consolidated financial
position or results of operations.

Sarbanes-Oxley Section 404 - The Securities and Exchange Commission issued
two releases on August 6, 2006 to grant smaller public companies and many
foreign private issuers further relief from compliance with Section 404 of the
Sarbanes-Oxley Act of 2002. The Commission is proposing to grant relief to
smaller public companies by extending the date by which non-accelerated filers
must start providing a report by management assessing the effectiveness of the
company's internal control over financial reporting. The initial compliance date
for these companies would be moved from fiscal years ending on or after July 15,
2007, until fiscal years ending on or after Dec. 15, 2007. The Commission also
proposes to extend the date by which non-accelerated filers must begin to comply
with the Section 404(b) requirement to provide an auditor's attestation report
on internal control over financial reporting in their annual reports. This
deadline would be moved to the first annual report for a fiscal year ending on
or after Dec. 15, 2008. This proposed extension would result in all
non-accelerated filers being required to complete only the management's portion

F-12

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

1. Summary of Significant Accounting Policies - (Continued)

of the internal control requirements in their first year of compliance with the
requirements. This proposal is intended to provide cost savings and efficiency
opportunities to smaller public companies and to assist them as they prepare to
comply fully with Section 404's reporting requirements. This proposed extension
will provide these issuers and their auditors an additional year to consider,
and adapt to, the changes in Auditing Standard No. 2 that the Commission and the
Public Company Accounting Oversight Board intend to make, as well as the
guidance for management the Commission intends to issue, to improve the
efficiency of the Section 404(b) auditor attestation report process.

2. Discontinued Operations

Due to the magnitude of the continuing operating losses incurred by our
Georgia ($3.4 million) and Tennessee ($1.8 million) subsidiaries during fiscal
2005 and our California ($3.2 million since inception), subsidiary in fiscal
2006, our Board of Directors determined it to be in the best interest of our
company to discontinue all Southeastern and West coast operations and dispose of
their respective operating assets. A majority of the Tennessee operating losses
were due to rapid market share growth within the state necessitating us to
transport an increasing number of Tennessee scrap tires to our Georgia facility
for processing at significant transportation and processing loss. A majority of
the Georgia operating losses were due to (1) the negative impact of processing a
significant number of Tennessee sourced tires; (2) a change in the
specifications of our primary end market customers requiring a smaller product
resulting in reduced processing capacity and significantly higher operating
costs and (3) equipment reliability issues resulting from aging equipment
processing an increasing number of scrap tires. A majority of the California
operating losses were due to significantly higher operating costs resulting from
rapid market share growth and equipment reliability issues resulting from aging
equipment.

In September 2005 we assigned all Tennessee scrap tire collection
contracts and certain other contracts with suppliers of waste tires and
contracts to supply whole tires to certain cement kilns in the southeastern
region of the United States to a company owned by a former employee. We received
no cash consideration for these assignments and recorded a $1,334,849 loss
(including a non-cash loss of $918,450 associated with goodwill written off) on
disposal of the operations at September 30, 2005. The aggregate net losses
including the loss on disposal associated with the discontinued operations of
our Tennessee subsidiary included in the results for year ended September 30,
2005 were approximately $3.1 million. We accrued $165,000 of estimated costs
associated with the Tennessee closure at September 30, 2005. During fiscal 2006
we incurred and charged against the accruals approximately $109,000. In
addition, $56,000 was reversed into income as a result of a reduction in certain
plant closure accruals and an agreement with our former Tennessee landlord
regarding past due amounts. Additionally, we recognized $70,000 associated with
insurance credits. In aggregate, we recognized approximately $126,000 of income
from discontinued Tennessee operations during the year ended September 30, 2006.

F-13

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

2. Discontinued Operations - (Continued)

In July 2006 we sold our California subsidiary to a third party for
$1,000. GreenMan Technologies of California, was formed in 2002 to acquire all
of the outstanding common stock of Unlimited Tire Technologies, Inc. an Azusa,
California scrap tire recycling company of which the third party was the
majority owner. The aggregate net losses including the loss on disposal
associated with the discontinued operations of our California subsidiary
included in the results of operations for year ended September 30, 2006 were
approximately $1,005,000. The aggregate net losses associated with our
California subsidiary included in the results for the fiscal year ended 2005
were approximately $1,365,000.

The major classes of assets and liabilities associated with discontinued
operations were:

September 30, September 30,
2006 2005
------------- -------------

Assets related to discontinued operations:
Cash .................................................... $ 31 $ 109,560
Accounts receivable, net ................................ -- 1,784,997
Equipment held for resale ............................... -- 539,332
Other current assets .................................... 7,260 342,596
---------- ----------
Total current ......................................... 7,291 2,776,485
Property, plant and equipment (net) ..................... -- 830,025
Other ................................................... -- 114,071
---------- ----------
Total non-current ..................................... -- 944,096
---------- ----------
Total assets related to discontinued operations ....... $ 7,291 $3,720,581
========== ==========

Liabilities related to discontinued operations:
Accounts payable ........................................ $2,575,134 $3,616,052
Notes payable, current .................................. 394,887 509,249
Accrued expenses, other ................................. 118,019 792,474
Capital leases, current ................................. 326,795 343,058
Lease payable, current .................................. -- 145,000
---------- ----------
Total current ......................................... 3,414,834 5,405,833
Notes payable, non-current .............................. -- 369,727
Capital leases, non-current ............................. -- 70,926
Lease payable, non-current .............................. -- 555,000
---------- ----------
Total non-current ..................................... -- 995,653
---------- ----------
Total liabilities related to discontinued operations .. $3,414,834 $6,401,486
========== ==========

Net sales and (loss) from discontinued operations were as follows:

September 30, September 30,
2006 2005
------------- ------------

Net sales from discontinued operations ............ $2,885,019 $15,369,641
(Loss) from discontinued operations ............... (1,460,981) (6,518,532)

F-14

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

3. Property, Plant and Equipment

Property, plant and equipment consists of the following:

September 30, September 30, Estimated
2006 2005 Useful Lives
------------- ------------ -------------

Buildings and improvements ...................... $ 1,741,943 $ 1,731,279 10-20 years
Machinery and equipment ......................... 7,188,119 6,223,775 5-10 years
Furniture and fixtures .......................... 164,025 188,329 3-5 years
Motor vehicles .................................. 3,586,457 3,454,955 3-10 years
Construction in process ......................... -- 3,604
------------ ------------
12,680,544 11,601,942
Less accumulated depreciation and amortization .. (6,873,425) (6,089,715)
------------ ------------
Property, plant and equipment, net .............. $ 5,807,119 $ 5,512,227
============ ============

During March 2004, our Minnesota subsidiary sold all of its land and
buildings to an entity co-owned by an officer for $1,400,000, realizing a gain
of $437,337 which has been recorded as unearned income and classified as a non
current liability in the accompanying financial statements. Simultaneous with
the sale, we entered into an agreement to lease the property back for a term of
12 years at an annual rent of $195,000, increasing to $227,460 over the term of
the lease. The gain will be recognized as income ratably over the term of the
lease. The lease has been classified as a capital lease, and provides for two
additional 4-year extensions. We used $875,000 of the proceeds to repay an
existing mortgage on the property.

In June 2005, we sold all our Wisconsin land and buildings for
approximately $483,000, realizing a gain of $123,608. We used approximately
$284,000 of the proceeds to repay an existing obligation on the property and
simultaneous with the sale, entered into an agreement to lease the property back
for a period of 90 days. We consolidated all remaining Wisconsin operations into
our Minnesota facility during the quarter ending September 30, 2005. During
fiscal 2005, our Wisconsin subsidiary reached an agreement with the lessor of
certain transportation equipment to buy-out the remaining term of the lease. The
lessor agreed to accept approximately $190,000 in full settlement of our capital
lease obligation with a carrying value of approximately $156,000, resulting in a
loss of approximately $34,000 in connection with this transaction. In addition,
management determined that the carrying value of the purchased transportation
equipment was impaired. Accordingly, we recorded an impairment loss amounting to
$57,183 during the fiscal year ended September 30, 2005 based on the estimated
fair value based on replacement cost of similar equipment and reduced the
remaining estimated useful life to 24 months.

Depreciation and amortization expense for the fiscal years ended September
30, 2006 and 2005 was $1,522,880 and $2,425,801 respectively, including
depreciation and amortization from discontinued operations of $213,689 and
$1,089,911, respectively.

4. Acquisition Deposit

In August 2004, in connection with our Georgia facility we executed a
non-binding letter of intent and escrow agreement with Tires Into Recycled
Energy and Supplies, Inc. ("TIRES"), a leading crumb rubber processor in the
United States. Pursuant to the escrow agreement, we made a "good faith" payment
amounting to $350,000, which was to be applied toward the purchase price upon
completion of the transaction. On December 8, 2004, we executed a new letter of
intent which superseded the August letter of intent in which we (1) leased, with
an option to buy, certain pieces of tire processing equipment owned by TIRES
(the "Equipment Leases"), (2) entered a material supply agreement (the "MSA")
and (3) were granted an exclusive purchase option to acquire additional
operating assets of TIRES. The operating leases were executed in January 2005
but became effective in February and March 2005 and provide for aggregate
monthly payments of $25,300 over terms ranging from 48 to 60 months.

We also agreed to allow TIRES to retain $101,378 of the "good faith"
payment to upgrade it's existing crumb rubber production capacity and have used
the remaining $248,622 to prepare and move the leased equipment for our use.
Accordingly, during the quarter ended March 31, 2005, the $101,378 was expensed
when it was released from escrow and approximately $243,597 has been capitalized
and was being amortized over the lease terms which ranged from 48 to 60 months.
The remaining balance of $205,306 was written off as a cost of disposal of
discontinued operations.

F-15

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

4. Acquisition Deposit - (Continued)

Pursuant to the terms of the MSA, we were to supply agreed upon minimum
amounts of crumb rubber material to TIRES on a weekly basis. If we do not meet
the minimum weekly requirements, we are assessed a shortfall fee equal to 150%
of the purchase price for any shortfall tonnage. Due to unexpected equipment
downtime and delays in installing the additional rasper which was being leased
from TIRES, we were unable to meet the minimum material requirements during
various periods during fiscal 2005 and as a result, we recorded a shortfall
expense of approximately $382,000 during the fiscal year ended September 30,
2005.

On June 6, 2005, we negotiated an amendment to the material supply
agreement whereby the minimum weekly requirement was reduced and the price at
which TIRES would purchase material was increased 15 percent for a period of 10
weeks. In return for this short term consideration, we agreed to reduce our
original pricing by 8% on the first 30,000 tons of material purchased by TIRES
subsequent to the 10 week amendment period.

The exclusive purchase option to acquire additional operating assets of
TIRES was exercisable if predetermined financial performance criteria are met by
TIRES during the subsequent fifteen to twenty four month period after December
8, 2004. The ultimate purchase price was to be determined based on those
results. In return for the exclusive purchase option, we issued 127,389 shares
of our common stock (valued at $200,000) to TIRES. Had we exercised our
exclusive purchase option and closed a transaction, the value of the shares
would have been applied against the purchase price of the assets. If the
exclusive purchase option expired or we decided not to exercise the option,
TIRES would retain a sufficient number of our shares to equal $200,000 (as of
the date that the purchase option expires) and return the balance of such shares
of common stock to us. If at the time the purchase option expired, the value of
the shares were less than $200,000, we would have been required to issue a
sufficient number of additional shares to equal $200,000. If at the time the
purchase option expired, TIRES had not achieved the predetermined financial
performance criteria, TIRES would have had to return to us a sufficient number
of our shares to equal $200,000 at the time.

In February 2006 in conjunction with the discontinuance of our Georgia
operations (See Note 2), we agreed to sell and assign to TIRES (a) certain truck
tire processing equipment located at our Georgia facility; (b) certain rights
and interests in our contracts with suppliers of scrap truck tires; (c) certain
intangible assets; and (d) allowed TIRES to retain the 127,389 shares of our
common stock and in return received $155,000 in cash proceeds; agreed to
terminate the MSA, Equipment Leases and several other agreements previously
executed between the parties in addition to terminating a December 2004 letter
of intent and exclusive option. Accordingly, at September 30, 2005, included in
loss on disposal of discontinued operations is the $200,000 assigned to the
shares of common stock retained by TIRES.

5. Credit Facility/Notes Payable

Republic Services of Georgia

On May 6, 2002 we issued Republic Services of Georgia, LP ("RSLP") a
$743,750 10% promissory note due in March 2007. On July 31, 2005, RSLP agreed to
defer all interest and principal payments due, including nine existing past-due
payments totaling $76,042 through June 2006 at which time all past due interest
and principal payments under the May 6, 2002 promissory note was to be
incorporated into an a new 10% promissory note, payable in 48 monthly
installments commencing July 2006.

On June 30, 2006 we reached an agreement with RSLP whereby in return for a
payment of $250,000 and the issuance of a $150,000 unsecured promissory note,
RSLP agreed to forgo all remaining amounts due under the revised May 6, 2002
promissory note totaling $766,355 at June 30, 2006. The settlement was
characterized as a troubled debt restructuring and as a result, we realized a
gain on restructuring of $353,476 during the quarter ended June 30, 2006. The
gain is included in other income on the accompanying consolidated statement of
operations. The note bears interest at 10% and is payable in 11 monthly
installments of $5,000 with the remaining balance due June 30, 2007.

First American Credit Facility

On February 13, 2003, our Iowa subsidiary amended its existing term debt
with First American under the terms of a five-year, $1,760,857 secured term
note. The note was payable in sixty monthly installments of $33,425 and secured
with all Iowa assets. The term note bore interest at 7.5% and the line of credit
bore interest at the prime rate plus 1%.

On February 10, 2005, First American renewed our working capital line
until February 10, 2006 (subsequently extended to June 15, 2006) and increased
our maximum availability under the line of credit to $800,000. On June 30, 2006,
we used $1,218,746 of the proceeds from the Laurus debt restructuring described
below to pay off all amounts due First American.

F-16

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

5. Credit Facility/Notes Payable - (Continued)

June 2004 Laurus Credit Facility

On June 30, 2004, we entered into a $9 million credit facility with Laurus
Master Fund, Ltd. ("Laurus"), consisting of a $5 million convertible, revolving
working capital line of credit and a $4 million convertible term note. At
closing, we borrowed $2 million under the line of credit and $4 million under
the term loan. We used the proceeds to repay certain existing debt obligations,
financing costs relating to this transaction, and general working capital. On
March 22, 2005, the credit facility was amended to (1) permit us to maintain
overradvances of up to $2,000,000 under the line of credit through December 31,
2005 (subsequently extended to May 31, 2006); (2) defer certain principal
payments on the term note as described below; and (3) reduce the conversion
price on the minimum borrowing note and term note as described below.

The line of credit had a three-year term and required us to maintain a
minimum borrowing of $1,000,000. Advances generally bore interest at the prime
rate plus 1.0% and were convertible into shares of our common stock at the
option of Laurus. Except for downward adjustments provided in the credit
facility terms described below, the interest rate would not be below 5%. Amounts
advanced under the line were limited to 90% of accounts receivable and 50% of
finished goods inventory as defined, subject to certain limitations. We were
permitted to maintain overadvances of up to $2,000,000 under the line of credit
until June 30, 2006.

Subject to certain limitations, Laurus had the option to convert the first
$1,000,000 of borrowings under the line of credit into our common stock at a
revised price of $0.79 (85% of the average closing price of our common stock for
the five days immediately preceding March 22, 2005). Each subsequent $1,000,000
of borrowings would be convertible at the higher of $.93 or a 10% premium over
the 22-day trailing average closing price computed on each $1,000,000 increment.
As a result of the reduction in conversion price pursuant to the terms of the
March 22, 2005 amendment, we recorded a beneficial conversion feature of
$598,717. The discount was recorded as additional paid-in-capital and was
amortized to interest as of December 31, 2005.

The term note also had a three-year term and bore interest at the greater
of prime rate plus 1% or 5%, payable monthly. Monthly principal payments of
$125,000 over the term of the loan commenced on November 1, 2004; however, the
terms of the March 22, 2005 amendment deferred the principal payments otherwise
due from December 1, 2004 through June 30, 2005, until the maturity date of the
term note, at which time the deferred payments and all other outstanding amounts
were due. In addition, Laurus agreed to defer principal payments otherwise due
from November 1, 2005 through June 1, 2006, which were to be payable in full at
maturity.

Laurus had the option to convert some or all of the note's principal and
interest payments into common stock at a revised fixed conversion price of $.79
on the first $1,000,000 of borrowings, and $.93 on the remaining amounts.
Subject to certain limitations, regular payments of principal and interest were
automatically payable in common stock if the 5-day average closing price of the
common stock immediately preceding a payment date was greater than or equal to
110% of such fixed conversion price. As a result of the change in conversion
price pursuant to the terms of the March 22, 2005 amendment, we recorded an
additional beneficial conversion feature of $1,485,594 on the term note. The
additional discount amount was recorded as paid-in-capital with the portion
attributed to the first $1,000,000 of borrowings, $567,429 which was amortized
to interest expense as of December 31, 2005 with the remaining balance of
$918,165 have been amortized over the remaining term of the note or ratably upon
any partial conversion.

On July 20, 2005, we issued an additional $1 million convertible term note
to Laurus. The note matured on June 30, 2007 and bore interest at the prime rate
plus 1.75%, payable monthly commencing August 1, 2005. Monthly principal
payments of $58,823.53 over the term of the loan were to commence on February 1,
2006. Laurus subsequently agreed to defer the principal payments otherwise due
from February 1, 2006 through May 1, 2006, until the maturity date of the term
note, at which time the deferred payments and all other outstanding amounts are
due. Laurus had the option to convert some or all of the principal and interest
payments into common stock at a price of $.33 (the average closing price of our
common stock on the American Stock Exchange for the 3-day period ending July 18,
2005).

In connection with this term note, we issued Laurus an option to purchase
up to an aggregate of 2,413,571 shares of our common stock at an exercise price
equal to $0.01 per share. This option, valued at $401,738, was immediately
exercisable, has a term of ten years, allows for cashless exercise at the option
of Laurus, and does not contain any "put" provisions. Net proceeds received from
issuance of the term note amounted to $955,000 and were allocated to the term
note and the option based on their relative fair values. The note contained a
beneficial conversion feature of $393,939 at issuance based on the intrinsic

F-17

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

5. Credit Facility/Notes Payable - (Continued)

value of the shares into which the note is convertible, and a debt issue
discount amounting to $446,738. The beneficial conversion amount was recorded as
paid in capital and was to be amortized to interest expense along with the debt
conversion discount over the two year term of the note or ratably upon any
partial conversion. The terms of the note were substantially similar to our June
2004 credit facility, including similar negative and restrictive covenants, as
well as reporting requirements and default provisions.

The conversion price applicable to each of the notes and the exercise
price of each of the warrants was previously subject to downward adjustment on a
"full ratchet" basis, if with certain exceptions, we issued shares of our common
stock (or common stock equivalents) at a price per share less than the
applicable conversion or exercise price. These rights have never been enforced
and on April 8, 2006, Laurus agreed to retroactively eliminate their rights to
enforce these provisions

June 2006 Laurus Credit Facility

On June 30, 2006, we entered into a $16 million amended and restated
credit facility with Laurus (the "New Credit Facility"). The New Credit Facility
consists of (1) a $5 million non-convertible secured revolving note (the
"Revolving Note"); and (2) an $11 million secured non-convertible term note (the
"Term Note"). Unlike the terms of our prior credit facility with Laurus, the New
Credit Facility is not convertible into shares of our common stock.

The Revolving Note has a three-year term from the closing, bears interest
on any outstanding amounts at the prime rate plus 2% (10.25% at September 30,
2006), with a minimum rate of 8%. Amounts advanced under the line are limited to
90% of accounts receivable and 50% of finished goods inventory, as defined up to
a maximum of $5 million, subject to certain limitations. There are no amounts
outstanding under the Revolving Note at September 30, 2006.

The Term Loan has a maturity date of June 30, 2009 and bears interest at
the prime rate plus 2% (10.25% at September 30, 2006), with a minimum rate of
8%. Interest on the Term Loan is payable monthly commencing August 1, 2006.
Principal will be amortized over the term of the loan, commencing on July 2,
2007, with minimum monthly payments of principal as follows: (i) for the period
commencing on July 2, 2007 through June 2008, minimum principal payments of
$150,000; (ii) for the period from July 2008 through June 2009, minimum
principal payments of $400,000; and (iii) the balance of the principal will be
payable on the maturity date. In addition, we have agreed to make an excess cash
flow repayment as follows: no later than ninety-five days following the end of
each fiscal year beginning with the fiscal year ending on September 30, 2007, we
have agreed to make a payment equal to 50% of (a) the aggregate net operating
cash flow generated for such fiscal year less (b) aggregate capital expenditures
made in such fiscal year (up to a maximum of 25% of the net operating cash flow
calculated in accordance with clause (a). The Term Loan may be prepaid at any
time without penalty. We used approximately $8,503,000 of the Term Note proceeds
to repay our outstanding indebtedness under our existing credit facility with
Laurus, approximately $1,219,000 to repay in full the indebtedness due First
American Bank; $250,000 to RSLP as part of a settlement agreement (as described
above) and paid approximately $888,000 of costs and fees associated with this
transaction which were expensed at June 30, 2006.

In connection with the New Credit Facility, we issued Laurus a warrant to
purchase up to an aggregate of 3,586,429 shares of our common stock at an
exercise price equal to $0.01 per share. This warrant, valued at $1,116,927, is
immediately exercisable, has a term of ten years, allows for cashless exercise
at the option of Laurus, and does not contain any "put" provisions. Previously
issued warrants to purchase an aggregate of 1,380,000 shares of our common
stock, which were issued in connection with the original notes on June 30, 2004
were canceled as part of this transaction. The amount of our common stock Laurus
may hold at any given time is limited to no more than 4.99% of our outstanding
stock. The fair value of these terminated warrants was determined to be $31,774
and offset the value of the new warrant issued. In addition, the fair value
associated with the foregone convertibility feature of all previous convertible
amounts was determined to be $740,998 and will also offset the value of the new
warrant issued. As a result of the foregoing, the net value assigned to the new
warrant of $344,155 was recorded as paid in capital and recorded as a reduction
to the carrying value of the refinanced note. The terms of the Term Note are
substantially similar to our June 2004 credit facility, including similar
negative and restrictive covenants, as well as reporting requirements and
default provisions.

Laurus Funds has agreed that it shall not, on any trading day, be
permitted to sell any common stock acquired upon exercise of this warrant in
excess of 10% of the aggregate numbers of shares of the common stock traded on
such trading day. We have agreed to register for resale under the Securities Act
of 1933 the shares of common stock issuable to Laurus Funds upon exercise of the
aforementioned warrant. We have not yet completed the registration of the
underlying shares and Laurus has waived any default resulting from the delay in
filing until January 30, 2007.

F-18

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

5. Credit Facility/Notes Payable - (Continued)

Pursuant to Statement of Financial Accounting Standards No. 15 "Accounting
by Debtors and Creditors for Troubled Debt Restructuring" ("SFAS 15") the New
Credit Facility will be accounted for as a troubled debt restructuring. It was
determined that, because the effective interest rate of the New Credit Facility
was lower than that of the previous credit facility therefore indicating a
concession was granted by Laurus, we are viewed as a passive beneficiary of the
restructuring, and no new transaction has occurred. Under SFAS 15, a
modification of terms "is neither an event that results in a new asset or
liability for accounting purposes nor an event that requires a new measurement
of an existing asset or liability." Thus, from a debtor's standpoint, SFAS 15
calls for a modification of the terms of a loan to be accounted for
prospectively. As a result, $258,900 of deferred financing fees and $972,836 of
debt discount and beneficial conversion features associated with the previous
credit facility were netted along with the value of the new warrants issued of
$344,155 against the new Term Debt related to the portion of the new debt that
refinanced the original outstanding Laurus debt and related accrued interest
totaling $8,503,416 to provide a net carrying amount of $6,927,525. The carrying
amount of the loan will be amortized over the term of the loan at a constant
effective interest rate of 20% applied to the future cash payments specified by
the new loan.

September 30, September 30,
Notes payable consists of the following at: 2006 2005
------------ -----------

Line of credit, First American, secured by all assets of GreenMan of Iowa, bearing
interest at prime plus 1.0% (7.75% at September 30, 2005) ............................... $ -- $ 619,950
Term note payable, First American, secured by assets of GreenMan of Iowa, due in equal
monthly installments of $33,425 including interest at 7.5% through February 2008 ........ -- 742,811
Term note payable, Republic Services of Georgia, LP, interest only at 10% through July
2006 at which time the outstanding balance will be payable in 48 monthly installments
including interest at 10% due July 2010 ................................................ -- 717,370
Term note payable, Republic Services of Georgia, LP, unsecured, due in 11 monthly
installments of $5,000 at 10% interest with the remaining balance due June 30, 2007 ..... 147,879 --
Term note payable, Laurus Master Fund, Ltd., interest only at prime plus 2% (10.25% at
September 30, 2006) through June 30, 2007 followed by 12 monthly principal
payments of $150,000 plus interest and then 12 monthly principal payments of
$400,000 plus interest with the remaining balance due June 2009 ......................... 9,424,109 --
Term note payable, State of Iowa, secured by certain assets of GreenMan of Iowa, due in
quarterly installments of $8,449 including interest at 1.5% with the remaining
principal balance due November 2012 ..................................................... 220,506 250,811
Term note payable, State of Iowa, secured by certain assets of GreenMan of Iowa, due in
32 quarterly installments of $6,920 including interest at 3% through October 2012 ....... 151,483 174,193
Term note payable, State of Iowa, secured by certain assets of GreenMan of Iowa, due in
28 quarterly installments of $16,469 including interest at 2% through July 2013 ......... 449,686 --
Other term notes payable and assessments, secured by various equipment with interest
rates ranging from 0% to 11.26% and requiring monthly installments from $598 to $9,765 .. 439,499 761,615
------------ -----------
10,833,162 3,266,750

Less current portion ...................................................................... (493,572) (1,383,008)
------------ -----------
Notes payable, non-current portion ...................................................... $ 10,339,590 $ 1,883,742
============ ===========

The following is a summary of maturities of carrying values of all notes payable
at September 30, 2006:

Years Ending September 30,
2007 ......................... $ 493,572
2008 ......................... 2,284,183
2009 ......................... 7,573,527
2010 ......................... 123,179
2011 ......................... 148,858
2012 and thereafter........... 209,843
-----------
$10,833,162
===========

The carrying value of the Laurus debt does not equate to the total cash payments
due under the debt as a result of accounting for a troubled debt restructure.
The following is a summary of the cash maturities of the Laurus debt:

Years Ending September 30,
2007 ......................... $ 450,000
2008 ......................... 2,550,000
2009 ......................... 8,000,000
-----------
$11,000,000
===========

F-19

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

5. Credit Facility/Notes Payable - (Continued)

Convertible notes payable at September 30, 2005 consisted of the
following:

Line of credit, Laurus, secured by eligible accounts receivable and inventory of GreenMan of Georgia,
Minnesota and Tennessee, bearing interest at prime plus 1.0%, net of discount of $977,834 .......... $ 3,290,155
Term note payable, Laurus, secured by machinery and equipment of GreenMan of Georgia, Minnesota and
Tennessee, due in 33 monthly installments of $125,000 plus interest at prime plus 1.0% and due
June 30, 2007, net of discount of $361,026 ......................................................... 3,138,974
Term note payable, Laurus, secured by machinery and equipment of GreenMan Technologies of Georgia,
Minnesota and Tennessee, due in 17 monthly installments of $58,824 plus interest at prime plus 1.75%
commencing February 1, 2006, net of discount of $735,593 ........................................... 264,409
-----------
6,693,538

Less current portion ................................................................................. (4,890,642)
-----------
Convertible notes payable, non-current portion ..................................................... $ 1,802,896
===========

Interest expense on the lines of credit and notes payable for the years
ended September 30, 2006 and 2005 amounted to $1,187,870 and $678,602
respectively.

6. Notes Payable - Related Party

Note Payable - Related Party

In November 2000, we borrowed $200,000 from a director under an unsecured
promissory note which bears interest at 12% per annum with interest due monthly
and the principal originally due in November 2001. In June 2001 and again in
September 2002, the director agreed to extend the maturity date of note until
November 2004. The director agreed to extend the maturity date several times and
on August 24, 2006, agreed to convert the $200,000 of principal and $76,445 of
accrued interest into 953,259 of unregistered shares of common stock at a price
of $.29 per share which was the closing price of our stock on the date of
conversion.

Between June and August 2003, two immediate family members of an officer
loaned us a total of $400,000 under the terms of two-year, unsecured promissory
notes which bear interest at 12% per annum with interest due quarterly and the
principal due upon maturity. In March 2004, these same individuals loaned us an
additional $200,000 in aggregate, under similar terms with the principal due
upon maturity March 2006. These individuals each agreed to invest the entire
$100,000 principal balance of their June 2003 notes ($200,000 in aggregate) into
our April 2004 private placement of investment units and each received 113,636
units in these transactions. In addition, the two individuals agreed to extend
the maturity of the remaining balance of these notes, $400,000 at September 30,
2006 until the earlier of when all amounts due under the Laurus credit facility
have been repaid or June 30, 2009. (see Note 5).

In September 2003, a former officer loaned us $400,000 under a September
30, 2003 unsecured promissory note which bore interest at 12% per annum with
interest due quarterly and the principal due March 31, 2004 (subsequently
extended to September 30, 2004). In 2004, the former officer applied
approximately $114,000 of the balance due him plus $21,000 of accrued interest
to exercise options to purchase 185,000 shares of unregistered common stock. In
addition, he agreed to extend the maturity of the remaining balance of this note
until the earlier of when all amounts due under the Laurus credit facility have
been repaid or June 30, 2009. In July 2006, the former officer assigned $79,060
of the remaining balance to one of an officer's immediate family members noted
above and the remaining balance of $20,260 plus accrued interest of $13,500 to
the officer.

Between January and June 2006, a director loaned us $155,000 under three
unsecured promissory notes which bear interest at 10% per annum with interest
and principal due during periods ranging from June 30, 2006 through September
30, 2006. On April 12, 2006, the director agreed in lieu of being repaid in cash
at maturity to convert $76,450 (including interest of $1,450) into 273,035
shares of unregistered common stock at a price of $.28 which was the closing
price of our stock on the date of conversion. In addition, on June 5, 2006 the
director agreed to convert $15,226 (including interest of $226) into 42,295
shares of unregistered common stock at a price of $.36 which was the closing
price of our stock on the date of conversion. As of September 30, 2006, the
remaining balance due on this note amounted to $65,000. The director has agreed
be paid $10,000 per month during the quarter ended December 31, 2006 and extend
the remaining $35,000 until the earlier of when all amounts due under the
restructured Laurus credit facility have been repaid or June 30, 2009.

F-20

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

6. Notes Payable - Related Party - (Continued)

The following is a summary of maturities of all related party notes
payable at September 30, 2006:

Years Ending September 30,
--------------------------
2007 ......................... $30,000
2008 ......................... --
2009.......................... 534,320
--------
$564,320
========

Total interest expense for related party notes amounted to $85,612 and
$83,918, for the fiscal years ended September 30, 2006 and 2005, respectively.
Total accrued interest due related parties amounted to $86,229 and $98,739 at
September 30, 2006 and 2005, respectively.

7. Capital Leases

We lease various facilities and equipment under capital lease agreements
with terms ranging from 36 months to 240 months and requiring monthly payments
ranging from $479 to $16,250. Assets acquired under capital leases with an
original cost of $3,066,136 and $2,529,832 and related accumulated amortization
of $1,257,455 and $1,016,987 are included in property, plant and equipment at
September 30, 2006 and 2005, respectively. Amortization expense for the years
ended September 30, 2006 and 2005 amounted to $240,488 and $237,054
respectively.

In July 2002, our Minnesota subsidiary entered into a four-year equipment
lease with a company co-owned by an employee for equipment valued at $146,670.
Under the terms of the lease, we were required to pay $4,394 per month rental
until the lease terminated in July 2006 at which time we purchased the equipment
for $60,000 as provided for in the lease.

In March 2004, our Minnesota subsidiary leased back their property from a
company co-owned by an employee under a twelve-year lease requiring an annual
rental of $195,000, increasing to $227,460 over the term of the lease. The lease
can be renewed for two additional four-year periods. The lease has been
classified as a capital lease with a value of $1,400,000 (See Note 3).

During fiscal 2006, we entered into four capital lease agreements with
Maust Asset Management, a company co-owned by one of our employees, for
equipment valued at $423,038. Under the terms of the leases we are required to
pay between $2,543 and $4,285 per month rental for a period of 60 months from
inception. We have the ability to purchase the equipment at the end of each
lease for prices ranging from $11,250 to $15,000 per unit.

F-21

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

7. Capital Leases - (Continued)

The following is a schedule of the future minimum lease payments under the
capital leases together with the present value of net minimum lease payments at
September 30, 2006:

Years Ending
September 30,
-------------
2007 .................................. $ 376,116
2008 .................................. 341,380
2009 .................................. 338,253
2010 .................................. 349,891
2011 .................................. 303,076
2012 and thereafter ................... 1,015,113
-----------
Total minimum lease payments ............. 2,723,829
Less amount representing interest ........ (922,197)
-----------
Present value of minimum lease payments .. $ 1,801,632
===========

For the years ended September 30, 2006 and 2005, interest expense on
capital leases amounted to $168,143 and $199,182, respectively.

8. Commitments and Contingencies

Management Changes

On April 12, 2006, our Board of Directors named Lyle E. Jensen as
President and Chief Executive Officer succeeding Robert H. Davis, who resigned
those positions, and resigned as a member of our Board of Directors, on the same
day. Mr. Jensen has been a member of our Board of Directors since May 2002, and
previously served as the Chair of the Board's Audit Committee and as member of
the Board's Compensation Committee. Mr. Jensen remains a member of the Board of
Directors, but no longer serves on these committees. Nicholas DeBenedictis, an
outside Director has joined the Compensation Committee and will serve as Audit
Committee Chair.

We entered into a five-year employment agreement with Mr. Jensen pursuant
to which Mr. Jensen receives a base salary of $195,000 per year. The agreement
automatically renews for one additional year upon each anniversary, unless
notice of non-renewal is given by either party. The agreement may be terminated
without cause on thirty days' notice but provides for payment of twelve months'
salary and certain benefits as a severance payment for termination without
cause. The agreement also provides for incentive compensation based on the
attainment of certain financial and non-financial goals. Mr. Jensen also
received a relocation allowance of $23,603 and a car allowance of $600 per
month. Mr. Jensen has been granted a qualified option under our 2005 Stock
Option Plan to purchase 500,000 shares of the our common stock, par value $.01
per share, with an exercise price of $.28 per share which was the closing price
of our stock on the date of grant. In addition, upon signing of his employment
agreement, Mr. Jensen purchased 500,000 unregistered shares of our common stock
at $.28 per share which was the closing bid price of the common stock on the
date the agreement was executed. In conjunction with Mr. Davis's resignation, we
agreed to the payment of salary and certain benefits for a subsequent twelve
month period which aggregate approximately $300,000 pursuant to certain
contractual obligations.

In addition, based on the intended sale of our California subsidiary (see
Note 2), notice of termination was provided to our California vice president on
June 30 and we agreed to the payment of salary and certain benefits for a
subsequent twelve month period which aggregate approximately $97,000 pursuant to
certain contractual obligations.

Employment Agreements

We have employment agreements with three (including Mr. Jensen) of our
corporate officers, which provide for base salaries, participation in employee
benefit programs and severance payments for termination without cause.

Rental Agreements

Our Iowa subsidiary leases a facility located on approximately 4 acres of
land under a 10-year lease commencing in April 2003 from Maust Asset Management
Company, LLC ("Maust Asset Management"), a company co-owned by one of our
employees. Under the terms of the lease, monthly rental payments of $8,250 on a
triple net basis are required for the first five years increasing to $9,000 on a
triple net basis per month for the remaining five years. The lease also provides
a right of first refusal to purchase the land and buildings at fair market value
during the term of the lease. Maust Asset Management acquired the property from
the former lessor. In April 2005, our Iowa subsidiary entered into an eight-year
lease agreement with Maust Asset Management for approximately 3 acres adjacent
to our existing Iowa facility at monthly rent payments of $3,500.

F-22

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

8. Commitments and Contingencies

Our California subsidiary leased approximately 45,000 square feet of a
building situated on approximately 1.5 acres of land for $1,250 per month. The
lease expired in April 2006 but we remained a tenant-at-will through the July
17, 2006 sale of GreenMan of California (see Note 2).

We lease approximately 3,380 square feet of office space from an unrelated
third party for our corporate headquarters pursuant to a five-year lease that
expires in May 2008. In June 2004, we amended this lease to include an
additional 1,125 square feet of office space for an additional monthly rent of
$1,500. In conjunction with the relocation of corporate headquarters from
Massachusetts to Minnesota we terminated our lease for our former headquarters
effective November 1, 2006. In return for the termination, we gave our landlord
$50,000 and 65,000 shares of our common stock (valued at $32,500). We are
allowed to remain in the existing space through December 31, 2006. As a result
of settlement, we recorded a lease settlement expense of $54,360 at September
30, 2006. In addition, as part of the settlement agreement, the landlord agreed
to provide us with approximately 1,100 square feet of office space for 12 months
commencing January 1, 2007 at no cost (valued at $15,000).

For the years ended September 30, 2006 and 2005, total rental expense in
connection with all non-cancellable real estate leases amounted to $219,840 and
$261,145, respectively including $141,000 and 123,000, respectively per year
associated with related-party leases.

We also rent various vehicles and equipment from third parties under
non-cancellable operating leases with monthly rental payments ranging from
$1,500 to $2,683 and with terms ranging from 38 to 47 months. In addition, we
rent several pieces of equipment on a monthly basis from a company co-owned by
an employee at monthly rentals ranging from $263 to $1,295. In January 2005, we
entered into three new equipment lease agreements with Maust Asset Management in
which we are required to pay between $1,500 and $2,683 per month rental and have
the ability to purchase the equipment at the end of the lease for between
$12,000 and $16,000.

For the fiscal years ended September 30, 2006 and 2005, total rent expense
in connection with non-cancellable operating vehicle and equipment leases
amounted to $68,837 and $58,805, respectively, of which, $68,199 and $51,149
were to related parties. The total future minimum rental commitment at September
30, 2006 under the above operating leases are as follows:

Year ending September 30: Real Estate Equipment Total
----------- ---------- ----------
2007 ......................... $147,570 $ 68,199 $ 215,769
2008 ......................... 145,500 19,416 164,916
2009 ......................... 150,000 -- 150,000
2010 ......................... 150,000 -- 150,000
2011 ......................... 150,000 -- 150,000
2012 and thereafter .......... 228,500 -- 228,500
-------- ---------- ----------
$971,570 $ 87,615 $1,059,185
======== ========== ==========

Litigation

As of September 30, 2006, approximately 14 vendors of our GreenMan
Technologies of Georgia, Inc. and GreenMan Technologies of Tennessee, Inc.
subsidiaries had commenced legal action, primarily in the state courts of
Georgia, in attempts to collect approximately $1.4 million of past due amounts,
plus accruing interest, attorneys' fees, and costs, all relating to various
services rendered to these subsidiaries. The largest individual claim is for
approximately $650,000. As of September 30, 2006, 5 vendors had secured
judgments in their favor against GreenMan Technologies of Georgia, Inc. for an
aggregate of approximately $237,000. As previously noted, all of GreenMan
Technologies of Tennessee, Inc.'s assets were sold in September 2005 and
substantially all of GreenMan Technologies of Georgia, Inc.'s assets were sold
as of March 1, 2006. All proceeds from these sales were retained by our secured
lender and these subsidiaries have no substantial assets. We are therefore
currently evaluating the alternatives available to these subsidiaries.

F-23

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

9. Stockholders' Equity

Increase in Authorized Shares of Common Stock

On June 16, 2005, our stockholders approved an amendment to our Rested
Certificate of Incorporation to increase the number of authorized shares of our
common stock from 30,000,000 to 40,000,000.

Elimination of the Description of Class A Convertible Preferred Stock

On June 16, 2005, our stockholders approved an amendment to our Restated
Certificate of Incorporation to eliminate the description of Class A Convertible
Preferred Stock due to the fact no such shares were authorized for issuance
under the Restated Certificate of Incorporation.

Other Common Stock Transactions

On April 12, 2006, our Chief Executive Officer purchased 500,000 shares of
our unregistered common stock (see Note 8) and on July 31, 2006 our Chief
Financial Officer purchased 50,000 unregistered shares of common stock.

During the quarter ended June 30, 2006, a director agreed to convert
$90,000 principal and $1,676 interest due him under certain unsecured promissory
notes payable into 315,330 shares of our unregistered common stock. (see Note 6)
During the year ended September 30, 2006 several directors and officers agreed
to accept 231,695 shares of unregistered common stock (valued at $82,046) in
lieu of cash for certain director's fees and expenses due the individuals. In
addition, we issued 133,330 shares of unregistered stock (valued at $30,000) to
a third party for consulting services rendered during fiscal 2006.

On August 24, 2006, a director agreed to convert $200,000 of principal and
$76,445 of accrued interest due him under an unsecured promissory note into
953,259 unregistered shares of common stock. (see Note 6)

1993 Stock Option Plan

The 1993 Stock Option Plan was established to provide stock options to our
employees, officers, directors and consultants. On March 29, 2001, our
stockholders approved an increase to the number of shares authorized under the
Plan to 3,000,000. This plan expired in June 2004.

Stock options and activity under the Plan is summarized as follows:

Year Ended Year Ended
September 30, 2006 September 30, 2005
--------------------- -----------------------
Weighted Weighted
Average Average
Exercise Exercise
Shares Price Shares Price
--------- -------- --------- --------

Outstanding at beginning of period 1,660,356 $ .85 1,670,356 $ .87
Granted -- -- -- --
Canceled (628,000) .94 (10,000) 1.58
Exercised -- -- -- --
--------- ---------
Outstanding at end of period 1,032,356 .82 1,660,356 .86
========= =========
Exercisable at end of period 1,022,356 .81 1,578,156 .85
========= =========
Reserved for future grants at end of period -- --
========= =========
Weighted average fair value of options
granted during the period $ -- $ --

Information pertaining to options outstanding under the plan at September 30,
2006 is as follows:

Options Outstanding Options Exercisable
------------------------------------- ----------------------
Weighted
Average Weighted Weighted
Remaining Average Average
Exercise Number Contractual Exercise Number Exercise
Prices Outstanding Life Price Exercisable Price
------ ----------- ----------- -------- ----------- --------

$ .38 - .53 504,462 3.8 $ .48 504,462 $ .48
$ .84 - 1.09 477,894 2.3 1.06 477,894 1.06
$ 1.35 - $1.80 50,000 4.6 1.80 40,000 1.80
--------- ---------
1,032,356 5.4 $ .82 1,022,356 $ .81
========= =========

F-24

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

9. Stockholders' Equity - (Continued)

2004 and 2005 Stock Option Plans

On April 21, 2004, our Board of Directors adopted the 2004 Stock Option
Plan (the "2004 Plan") subject to ratification by our stockholders. During May
and August 2004, the Board granted options to purchase 538,000 shares of our
common stock under the 2004 Plan at prices ranging from $1.05 to $1.24 and
having a weighted average fair value of $.32 per share. Subsequently, the Board
chose not to submit the 2004 Plan for ratification by our stockholders and the
plan and all granted options were terminated by our Board on March 18, 2005, and
all options granted under that plan have been terminated.

In addition, on March 18, 2005, our Board of Directors adopted the 2005
Stock Option Plan (the "2005 Plan"), which was subsequently approved by our
stockholders on June 16, 2005. The options granted under the 2005 Stock Option
Plan may be either options intended to qualify as "incentive stock options"
under Section 422 of the Internal Revenue Code of 1986, as amended; or
non-qualified stock options. During the fiscal year ended September 30, 2006,
929,000 qualified options in aggregate were granted with 792,000 options having
an exercise price of $.28 per share and 137,000 having an exercise price of $.36
per share. All options vest annually at 20% per year from date of grant and have
a ten year term. Options granted during fiscal 2006 had a weighted average
exercise price of $.29 per share, a weighted average fair value on date of grant
of $.12 per share and a weighted average contractual remaining life of 9.6
years. No options were vested at September 30, 2006.

Non-Employee Director Stock Option Plan

Under the terms of our 1996 Non-Employee Director Stock Option Plan on a
non-employee director's initial election to the Board of Directors, they are
automatically granted an option to purchase 2,000 shares of our common stock.
Each person who was a member of the Board of Directors on January 24, 1996, and
was not an officer or employee, was automatically granted an option to purchase
2,000 shares of our common stock. In addition, after an individual's initial
election to the Board of Directors, any director who is not an officer or
employee and who continues to serve as a director will automatically be granted,
on the date of the annual meeting of stockholders, an option to purchase an
additional 2,000 shares of our common stock. The exercise price per share of
options granted under the Non-Employee Director Stock Option Plan is 100% of the
fair-market value of our common stock on the business day immediately prior to
the date of the grant and is immediately exercisable for a period of ten years
from the date of the grant.

The Board of Directors has reserved 60,000 shares of our common stock for
issuance under this plan and as of September 30, 2006, options to purchase
38,000 shares of our common stock have been granted of which 28,000 are
outstanding and exercisable at prices ranging from $0.38 to $1.95. During fiscal
2006, the Compensation Committee agreed to discontinue future option grants
pursuant to the Non-Employee Director Stock Option Plan.

During the fiscal year ended September 30, 2005 options were granted to
purchase 6,000 shares of common stock at $.51 per share. The options are
exercisable for a period of ten years. The weighted average fair value of the
options granted during the year ended September 30, 2005 was $.16 per share. At
September 30, 2006, options outstanding had a weighted average exercise price of
$1.10 per share and a weighted average contractual life of 6.5 years.

Other Stock Options and Warrants

On June 30, 2004, we issued Laurus a warrant to purchase up to 990,000
shares of our common stock at prices ranging from $1.63 to $2.29 and a warrant
to purchase up to 390,000 shares of our common stock at prices ranging from
$1.56 to $2.18. These warrants were terminated in conjunction with the June 2006
Laurus refinancing. (see Note 5). In addition, we issued a warrant to purchase
up to 270,000 shares of our common stock at prices ranging from $1.64 to $2.29
for investment banking services. The warrants vested immediately and have a
five-year term.

On July 20, 2005, we issued Laurus an option to purchase up to an
aggregate of 2,413,571 shares of our common stock at an exercise price equal to
$0.01 per share. This option, valued at $401,738, is immediately exercisable,
has a term of ten years, allows for cashless exercise at the option of Laurus,
and does not contain any "put" provisions.

On June 30, 2006, we issued Laurus a warrant to purchase up to an
aggregate of 3,586,429 shares of our common stock at an exercise price equal to
$0.01 per share. This option, valued at $1,116,927, is immediately exercisable,
has a term of ten years, allows for cashless exercise at the option of Laurus,
and does not contain any "put" provisions.

F-25

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

9. Stockholders' Equity - (Continued)

Information pertaining to all other options and warrants granted and outstanding
is as follows:

Outstanding at beginning of period 7,015,574 $ .98 4,756,003 $1.55
Granted 3,586,429 .01 2,413,571 .01
Canceled (1,648,400) 1.80 (154,000) 3.36
Exercised -- -- -- --
--------- ---------
Outstanding at end of period 8,953,603 .44 7,015,574 .98
========= =========
Exercisable at end of period 8,948,603 .44 6,985,574 .98
========= =========

Weighted average fair value of options
granted during the period $ .31 $ .30

$ .01 - 1.09 7,831,497 7.74 $ .23 7,831,497 $ .23
$ 1.50 - 4.50 1,092,106 1.35 1.82 1,087,106 1.82
$ 5.00 - 5.65 30,000 .25 5.65 30,000 5.65
--------- ---------
8,953,603 6.94 $ .44 8,948,603 $ .44
========= =========

Common Stock Reserved

We have reserved common stock at September 30, 2005 as follows:

Stock option plans ..................... 1,989,356
Other stock options .................... 882,500
Other warrants ......................... 8,071,103
----------
10,942,959
==========

10. Employee Benefit Plan

Effective August 1999, we implemented a Section 401(k) plan for all
eligible employees. Employees are permitted to make elective deferrals of up to
15% of employee compensation and employee contributions to the 401(k) plan are
fully vested at all times. We may make discretionary contributions to the 401(k)
plan which become vested over a period of five years. There were no corporate
contributions to the 401(k) plan during the years ended September 30, 2006 and
2005, respectively.

11. Segment Information

We operate in one business segment, the collecting, processing and
marketing of scrap tires to be used as feedstock for tire derived fuel, civil
engineering projects and/or for further processing into crumb rubber.

12. Major Customers

During the fiscal years ended September 30, 2006 and 2005, no one customer
accounted for more than 10% of our consolidated net sales.

F-26

GreenMan Technologies, Inc.
Notes To Consolidated Financial Statements

13. Income Taxes

The provision for income taxes was comprised of the following amounts for
the years ended:

September 30, September 30,
2006 2005
------------- -------------
Current:
Federal ........................................ $ -- $270,000
State .......................................... 65,337 4,745
-------- --------
65,337 274,745
Deferred federal and state taxes ............... -- --
-------- --------
Total provision for income taxes .............. $ 65,337 $274,745
======== ========

The current state taxes result from income in states where we have no net
operating loss carry forwards. The provision for deferred income taxes reflect
the impact of "temporary differences" between amounts of assets and liabilities
recorded for financial reporting purposes and the amounts recorded for income
tax reporting purposes.

The difference between the statutory federal income tax rate of 34% and
the effective rate is primarily due to net operating losses incurred by us and
the provision of a valuation reserve against the related deferred tax assets.

The following differences give rise to deferred income taxes:

September 30, September 30,
2006 2005
------------- -------------

Net operating loss carry forwards ........ $ 12,961,000 $ 11,835,000
Differences in fixed asset bases ......... (503,000) 522,000
Capital loss carryover ................... 1,287,000 --
Other, net ............................... 543,000 1,296,000
------------ ------------
14,288,000 13,653,000
Valuation reserve ........................ (14,288,000) (13,653,000)
------------ ------------
Net deferred tax asset ................... $ -- $ --
============ ============

Previously, we had recorded a full valuation allowance on the net
operating loss carry forwards and other components of the deferred tax assets
based on our expected ability to realize the benefit of those assets. In the
year ending September 30, 2002, we reduced the valuation allowance by $270,000
based on our net income before taxes in the year then ending as well as expected
net income before income taxes for the next fiscal year.

Based on the unforeseen magnitude of our quarterly and year to date
losses, we determined the near-term realizability of the $270,000 non-cash
deferred tax asset to be questionable and therefore provided a valuation
allowance on the entire amount during the first quarter of our fiscal year ended
September 30, 2005.

The change in the valuation reserve is as follows:

Year Ended Year Ended
September 30, September 30,
2006 2005
------------- ------------
Balance at beginning of period ................. $13,653,000 $ 8,364,000
Increase due to rate differentials and
current period operating results ............ 635,000 5,289,000
----------- -----------
Balance at end of period ....................... $14,288,000 $13,653,000
=========== ===========

As of September 30, 2006, we had net operating loss carry forwards of
approximately $36 million including a net operating loss of $33 million and a $3
million capital loss carry forwards. The Federal and state net operating loss
carry forwards expire in varying amounts beginning in 2013 and 2007,
respectively. In addition, we have Federal tax credit carry forwards of
approximately $17,000 available to reduce future tax liabilities. The Federal
tax credit carry forwards expire beginning in 2013. Use of net operating loss
and tax credit carry forwards maybe subject to annual limitations based on
ownership changes in our common stock as defined by the Internal Revenue Code.

14. Fair Value of Financial Instruments

At September 30, 2006 and 2005, our financial instruments consist of
accounts receivable, accounts payable and notes payable to banks and others.
These instruments approximate their fair values as these instruments are either
due currently or were negotiated currently and bear interest at market rates.

F-27

PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 24 - INDEMNIFICATION OF DIRECTORS AND OFFICERS.

Under our certificate of incorporation and bylaws, our directors and
officers are entitled to be indemnified by us to the fullest extent permitted by
Section 102(b)(7) of the Delaware General Corporation Law. Additionally, under
our certificate of incorporation and bylaws, our directors are not subject to
personal liability to us or our stockholders for monetary damages resulting from
a breach of fiduciary duty or failure to exercise any applicable standard of
care, except that our directors may be subject to personal liability for
monetary damages in circumstances involving:

o a breach of the duty of loyalty;

o acts or omissions not in good faith which involve intentional
misconduct or a knowing violation of law;

o unlawful payments of dividends, stock purchases or redemptions under
the Delaware General Corporation Law; or

o transactions from which the director derives an improper personal
benefit.

ITEM 25 - OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.

The following table sets forth the estimated costs and expenses of the
Company in connection with the offering described in this registration
statement. None of these costs and expenses will be paid by any of the selling
stockholders.

Securities and Exchange Commission Registration Fee............ $ 55.00
Legal Fees and Expenses........................................ 5,000.00
Accounting Fees and Expenses................................... 7,500.00
Other Expenses................................................. 2,000.00
----------
Total Costs and Expenses....................................... $14,555.00
==========

ITEM 26 - RECENT SALES OF UNREGISTERED SECURITIES.

During the quarter ended December 31, 2006, we issued 26,828 shares of our
unregistered common stock valued at $10,796 to several directors in lieu of cash
for past due fees and expenses due them. The issuance of these shares is exempt
from registration under the Securities Act pursuant to Section 4(2) of the
Securities Act.

On November 1, 2006 we issued 65,000 shares of our unregistered common
stock valued at $32,500 to a third party as part of a settlement agreement
relating to our former corporate headquarters lease. The issuance of these
shares is exempt from registration under the Securities Act pursuant to Section
4(2) of the Securities Act.

On October 19, 2006, we issued 13,636 shares of our unregistered common
stock valued at $4,500 to a third party for consulting services rendered during
fiscal 2006. The issuance of these shares is exempt from registration under the
Securities Act pursuant to Section 4(2) of the Securities Act.

On August 14, 2006, we issued 953,259 shares of our unregistered common
stock to one of our directors upon conversion of $200,000 of principal and
$76,445 of accrued interest on a promissory note. The issuance of these shares
is exempt from registration under the Securities Act pursuant to Section 4(2) of
the Securities Act.

II-2

On July 31, 2006, our chief financial officer purchased 50,000
unregistered shares of our common stock at a price of $.30 per share (the
closing bid price of the common stock on the date the purchase). The issuance of
these shares was exempt from registration pursuant to Section 4(2) of the
Securities Act.

During the quarter ended June 30, 2006, we issued 315,330 shares of our
unregistered common stock to one of our directors upon partial conversion of
$90,000 of principal and $1,676 of accrued interest on two promissory notes. The
issuance of these shares is exempt from registration under the Securities Act
pursuant to Section 4(2) of the Securities Act.

On June 16, 2006, we issued 133,330 shares of our unregistered common
stock valued at $30,000 to a third party for consulting services rendered during
fiscal 2006. The issuance of these shares is exempt from registration under the
Securities Act pursuant to Section 4(2) of the Securities Act.

On June 30, 2006, in a transaction exempt from registration under Section
4(2) of the Securities Act, in connection with a $16,000,000 credit facility, we
issued to Laurus Master Fund, Ltd. a ten-year warrant to purchase 3,586,429
shares of our common stock at a price of $.01 per share.

On June 5, 2006, we issued 186,240 shares of our unregistered common stock
valued at $67,046 to several directors and officers in lieu of cash for past due
fees and expenses due them. The issuance of these shares is exempt from
registration under the Securities Act pursuant to Section 4(2) of the Securities
Act.

On April 12, 2006, upon signing of his employment agreement, Mr. Lyle
Jensen purchased 500,000 unregistered shares of our common stock at a price of
$.28 per share (the closing bid price of the common stock on the date the
agreement was executed). The issuance of these shares was exempt from
registration pursuant to Section 4(2) of the Securities Act.

On July 20, 2005, in a transaction exempt from registration under Section
4(2) of the Securities Act, we issued an additional $1 million secured
convertible term note to Laurus. As part of the transaction, Laurus was also
issued a ten-year option to purchase 2,413,571 shares of our common stock at an
exercise price equal to $.01 per share. Amounts outstanding under the term note
are convertible into common stock at Laurus's option at a conversion price
initially equal to $.33 per share.

On June 30, 2004, in a transaction exempt from registration under Section
4(2) of the Securities Act, we issued a $4 million secured convertible term
note, a $4 million convertible secured convertible revolving note and a $1
million secured minimum borrowing note, to Laurus Master Fund, Ltd. for an
aggregate purchase price of $9 million. As part of the transaction, Laurus was
also issued ten-year warrants to purchase 1,380,000 shares of our common stock
at prices ranging from $1.56 to $2.29 per share. Amounts outstanding under the
term note are convertible into common stock at Laurus's option at a conversion
price initially equal to $1.25 per share. In addition, subject to (i) having an
effective registration statement with respect to the shares of common stock
underlying the term note, and (ii) limitations based on trading volume of the
common stock, scheduled principal and interest payments under the term note will
be made in shares of common stock valued at the conversion price. Amounts
outstanding under the revolving and minimum borrowing notes are convertible to
common stock at Laurus's option at a conversion price initially equal to $1.31
per share. The conversion prices under the notes are subject to equitable
adjustment for stock splits, stock dividends and similar events, and "weighted
average" adjustment for future stock issuances (other than stock issuances in
specifically excepted transactions).

In February 2002, we commenced a private offering of our common stock to
accredited investors (as that term is defined in Rule 501 of Regulation D under
the Securities Act) in an effort to raise up to $2,000,000 in gross proceeds
(subsequently increased to $3,000,000 in August 2002). As of September 30, 2003,
when the offering terminated, we had sold 1,458,511 shares of our common stock
to investors, including existing shareholders, for gross proceeds of $2,133,603.
The sale of these shares was exempt from registration pursuant to Section 4(2)
of the Securities Act.

In December 2003, we entered into a note purchase agreement with an
accredited investor pursuant to which we issued a 10% convertible note payable
eu3 December 2004 in the aggregate principal amount of $375,000. The Note was
convertible at the option of the Holder at any time prior to maturity into
special investment units at a price equal to $1.07 per unit with each unit
consisting of one share of unregistered common stock and a warrant to purchase

II-3

1.5 shares of common stock at an exercise price of $1.07 per share, exercisable
six months after issuance for a period of five years from date of issuance. The
note was converted on June 24, 2004 into 369,331 shares of common stock and we
issued warrants to purchase 553,997 shares of our common stock. The sale of the
note and the issuance of the shares of common stock upon conversion were exempt
from registration pursuant to Section 4(2) of the Securities Act.

In February 2004, we issued 724,281 shares of our common stock to one of
our directors upon conversion of certain convertible promissory notes in the
aggregate principal amount of $375,000, together with $168,210 of accrued
interest. The issuance of the shares of common stock upon conversion were exempt
from registration pursuant to Section 4(2) of the Securities Act.

In April 2004, we commenced a private offering of investment units to
accredited investors, each unit consisting of one share of our common stock and
a warrant to purchase 0.5 shares of our common stock. As of June 30, 2004, when
the offering terminated, we had sold 1,594,211 units (1,594,211 shares of our
common stock and warrants to purchase 797,105 additional shares of our common
stock at prices ranging from $1.56 to $2.06 per share) to investors, including
our directors and existing shareholders, for gross proceeds of $1,547,800. The
sale of these units was exempt from registration pursuant to Section 4(2) of the
Securities Act.

We have issued options to purchase shares of our common stock from time to
time under our 1993 Stock Option Plan, our 2004 Stock Option Plan and our 1996
Non-Employee Director Stock Option. The exercise prices of such options are
equivalent to the fair market value of our common stock on the respective grant
dates. Such stock option grants, and the issuance of shares of stock upon
exercise of such options, are exempt from registration pursuant to Section 4(2)
of the Securities Act.

ITEM 27 - EXHIBITS.

The following exhibits are filed with this document:

Exhibit No. Description
----------- -----------

2.1 (1) -- Asset Purchase Agreement dated February 17, 2006 between
GreenMan Technologies of Georgia, Inc., GreenMan
Technologies, Inc. and Tires Into Recycled Energy and
Supplies, Inc.

2.2 (1) -- Asset Purchase Agreement dated March 1, 2006 between
GreenMan Technologies of Georgia, Inc., GreenMan
Technologies, Inc. and MTR of Georgia, Inc.

2.3 (1) -- Amendment No. 1 to Lease Agreement dated February 28, 2006
between GreenMan Technologies of Georgia, Inc. and Mart
Management, Inc.

3.1 (2) -- Restated Certificate of Incorporation as filed with the
Secretary of State of the State of Delaware on May 1,
2003, as amended

3.2 (3) -- By-laws of GreenMan Technologies, Inc.

4.1 (3) -- Specimen certificate for Common Stock of GreenMan
Technologies, Inc.

4.2 (2) -- Option Agreement, dated July 20, 2005 by and between
GreenMan Technologies, Inc. and Laurus Master Fund, Ltd.

4.3 (4) -- Common Stock Purchase Warrant, dated June 30, 2006, issued
To Laurus Master Fund, Ltd.

4.4 (4) -- Registration Rights Agreement dated June 30, 2006, made by
GreenMan Technologies, Inc. to Laurus Master Fund, Ltd.

5.1 (19) -- Opinion of Morse, Barnes-Brown & Pendleton, P.C.

10.1 (5) -- Securities Purchase Agreement, dated June 30, 2004, by and
between GreenMan Technologies, Inc. and Laurus Master
Fund, Ltd.

10.2 (5) -- Security Agreement, dated June 30, 2004, by and among
GreenMan Technologies, Inc. and certain of its
subsidiaries, in favor of Laurus Master Fund, Ltd.

II-4

10.3 (5) -- Master Security Agreement, dated June 30, 2004, by and
among GreenMan Technologies, Inc. and certain of its
subsidiaries, in favor of Laurus Master Fund, Ltd.

10.4 (5) -- Subsidiary Guarantee, dated June 30, 2004, by and among
GreenMan Technologies of Minnesota, Inc., GreenMan
Technologies of Georgia, Inc., GreenMan Technologies of
Iowa, Inc., GreenMan Technologies of Tennessee, Inc.,
GreenMan Technologies of Wisconsin, Inc. and GreenMan
Technologies of California, Inc., in favor of Laurus
Master Fund, Ltd.

10.5 (5) -- Stock Pledge Agreement, dated June 30, 2004, by and among
GreenMan Technologies, Inc. and Laurus Master Fund, Ltd.

10.6 (6) -- Amendment No. 1 and Waiver dated March 22, 2005 by and
among GreenMan Technologies, Inc. and certain of its
subsidiaries, in favor of Laurus Master Fund, Ltd.

10.7 (2) -- Securities Purchase Agreement, dated July 20, 2005, by and
between GreenMan Technologies, Inc. and Laurus Master
Fund, Ltd.

10.8 (2) -- Reaffirmation and Ratification Agreement, dated July 20,
2005 by and between GreenMan Technologies, Inc. and
certain of its subsidiaries, in favor of Laurus Master
Fund, Ltd.

10.9 (7) -- Waiver dated April 8, 2006 by and among GreenMan
Technologies, Inc. and Laurus Master Fund, Ltd.

10.10 (4) -- Amended and Restated Security Purchase Agreement, dated
June 30, 2006, by and among GreenMan Technologies, Inc.
and certain of its subsidiaries, in favor of Laurus Master
Fund, Ltd.

10.11 (4) -- Secured Non-Convertible Term Note, dated June 30, 2006,
made by GreenMan Technologies, Inc. to Laurus Master Fund,
Ltd.

10.12 (4) -- Secured Non-Convertible Revolving Note, dated June 30,
2006, made by GreenMan Technologies, Inc. to Laurus Master
Fund, Ltd.

10.13 (4) -- Reaffirmation and Ratification Agreement dated June 30,
2006, made by GreenMan Technologies, Inc. to Laurus Master
Fund, Ltd.

10.14 (4) -- Stock Pledge Agreement, dated June 30, 2006, by and among
GreenMan Technologies, Inc. and Laurus Master Fund, Ltd.

10.15 (4) -- Escrow Agreement dated June 30, 2006, among GreenMan
Technologies, Inc., Laurus Master Fund, Ltd., and Loeb &
Loeb LLP, as Escrow Agent

10.16 (3) -- 1993 Stock Option Plan

10.17 (8) -- 2005 Stock Option Plan

10.18 (3) -- Form of confidentiality and non-disclosure agreement for
executive employees

10.19 (9) -- Employment Agreement dated April 1, 2003 between GreenMan
Technologies, Inc. and Maurice E. Needham

10.20 (10) -- Employment Agreement dated April 12, 2006, between
GreenMan Technologies, Inc. and Lyle E. Jensen

10.21 (11) -- Employment Agreement between GreenMan Technologies, Inc.
and Charles E. Coppa

10.22 (11) -- Employment Agreement between GreenMan Technologies, Inc.
and Robert H. Davis

10.23 (12) -- Promissory Note issued by Robert H. Davis dated January 9,
1998 in favor of GreenMan Technologies, Inc.

10.24 (9) -- $400,000 Promissory Note by GreenMan Technologies, Inc. to
Robert H. Davis and Nancy Karfilis Davis dated September
30, 2003

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10.25 (13) -- Extension Agreement dated March 31, 2004 between GreenMan
Technologies, Inc. and Robert H. Davis and Nancy
Karfilis-Davis

10.26 (12) -- Promissory note issued November 17, 2000 by GreenMan
Technologies, Inc. to Dr. Allen Kahn

10.27 (12) -- Extension Agreement dated September 30, 2000 between
GreenMan Technologies, Inc. and Dr. Allen Kahn

10.28 (12) -- Extension Agreement dated June 27, 2001 between GreenMan
Technologies, Inc and Dr. Allen Kahn

10.29 (14) -- Extension Agreement dated September 23, 2002 between
GreenMan and Dr. Allen Kahn

10.30 (13) -- $100,000 Promissory Note issued by GreenMan Technologies,
Inc. to Joyce Ritterhauss dated March 10, 2004

10.31 (9) -- $100,000 Promissory Note by GreenMan Technologies, Inc. to
Barbara Morey dated June 26, 2003

10.32 (9) -- $100,000 Promissory Note by GreenMan Technologies, Inc. to
Barbara Morey dated August 26, 2003

10.33 (13) -- $100,000 Promissory Note issued by GreenMan Technologies,
Inc. to Barbara Morey dated March 18, 2004

10.34 (5) -- Subordination Agreement, dated June 30, 2004, by and among
Barbara Morey, Joyce Ritterhauss, Allen Kahn, Robert Davis
and Nancy Davis, in favor of Laurus Master Fund, Ltd.

10.35 (15) -- $25,000 Unsecured Promissory Note issued by GreenMan
Technologies, Inc. to Nicholas and Nancy DeBenedictis
dated January 6, 2006

10.36 (15) -- $100,000 Unsecured Promissory Note issued by GreenMan
Technologies, Inc. to Nicholas and Nancy DeBenedictis
dated January 6, 2006

10.37 (4) -- $30,000 Unsecured Promissory Note issued by GreenMan
Technologies, Inc. to Nicholas and Nancy DeBenedictis
dated May 6, 2006

4.51 (4) -- Subordination Agreement, dated March 15, 2006 by and among
Nicholas and Nancy DeBenedictis in favor of Laurus Master
Fund, Ltd.

10.38 (13) -- Purchase Agreement dated February 21, 2004 between
GreenMan Technologies of Minnesota, Inc. and Earl Fisher

10.39 (13) -- Commercial Lease Agreement dated March 25, 2004 between
GreenMan Technologies of Minnesota, Inc. and Two Oaks, LLC

10.40 (16) -- Purchase and Sale Agreement By and Between GreenMan
Technologies of Georgia, Inc. and WTN Realty Trust dated
April 2, 2001

10.41 (16) -- Lease Agreement By and Between WTN Realty Trust to
GreenMan Technologies of Georgia, Inc. dated April 2, 2001

10.42 (17) -- $750,000 Promissory Note by GreenMan Technologies, Inc. to
Republic Services of Georgia, LP dated May 6, 2002

10.43 (2) -- Waiver Agreement by Republic Services of Georgia, LP dated
July 31, 2005

10.44 (4) -- Mutual General Release by and between GreenMan
Technologies, Inc. et al. and Republic Services, Inc.
dated June 30, 2006

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10.45 (4) -- $150,000 Promissory Note by GreenMan Technologies, Inc. to
Republic Services of Georgia, LP dated June 30, 2006

10.46 (9) -- Lease -- Business Property agreement dated April 1, 2003
between GreenMan Technologies of Iowa, Inc. and Maust
Asset Management, LLC

10.47 (9) -- Guaranty dated September 12, 2003 by GreenMan
Technologies, Inc. of obligations of GreenMan Technologies
of Iowa, Inc. under the Lease -- Business Property with
Maust Asset Management, LLC

10.48 (7) -- Lease -- Business Property agreement dated March 1, 2005
between GreenMan Technologies of Iowa, Inc. and Maust
Asset Management, LLC

10.49 (7) -- Lease -- Motor Vehicle agreement dated January 1, 2005
between GreenMan Technologies of Minnesota, Inc. and Maust
Asset Management, LLC

10.50 (7) -- Lease -- Motor Vehicle agreement dated January 1, 2005
between GreenMan Technologies of Minnesota, Inc. and Maust
Asset Management, LLC

10.51 (7) -- Lease -- Motor Vehicle agreement dated January 1, 2005
between GreenMan Technologies of Minnesota, Inc. and Maust
Asset Management, LLC

10.52 (18) -- Lease -- Motor Vehicle agreement dated December 29, 2005
between GreenMan Technologies of Minnesota, Inc. and Maust
Asset Management, LLC

10.53 (18) -- Lease -- Motor Vehicle agreement dated July 1, 2006
between GreenMan Technologies of Minnesota, Inc. and Maust
Asset Management, LLC

10.54 (18) -- Lease -- Motor Vehicle agreement dated July 1, 2006
between GreenMan Technologies of Minnesota, Inc. and Maust
Asset Management, LLC

10.55 (18) -- $20,260 Unsecured Promissory Note by GreenMan
Technologies, Inc. to Barbara Morey dated July 7, 2006

10.56 (18) -- $79,060 Unsecured Promissory Note by GreenMan
Technologies, Inc. to Barbara Morey dated July 7, 2006

10.57 (18) Release agreement dated November 30, 2006 between Robert
H. Davis and GreenMan Technologies, Inc.

21.1 (18) -- List of All Subsidiaries

23.1 (19) -- Consent of Morse, Barnes-Brown & Pendleton, P.C. (included
in Exhibit 5.1).

23.2 (19) -- Consent of Wolf & Co., P.C.

24.1 (19) -- Power of Attorney (included with Signature Page)

----------
(1) Filed as an Exhibit to the Registrant's Form 8-K dated February 17, 2006
and filed March 6, 2006, and incorporated herein by reference.

(2) Filed as an Exhibit to the Registrant's Form 10-QSB for the Quarter Ended
June 30, 2005 and incorporated herein by reference.

(3) Filed as an Exhibit to the Registrant's Registration Statement on Form
SB-2 No. 33-86138 and incorporated herein by reference.

II-7

(4) Filed as an Exhibit to the Registrant's Form 10-QSB for the Quarter Ended
June 30, 2006 and incorporated herein by reference.

(5) Filed as an Exhibit to the Registrant's Registration Statement on Form
SB-2 (File No. 333-117819), and incorporated herein by reference.

(6) Filed as an Exhibit to the Registrant's Form 8-K dated March 22, 2005 and
filed March 28, 2005, and incorporated herein by reference.

(7) Filed as an Exhibit to the Registrant's Form 10-KSB for the fiscal year
ended September 30, 2005 and incorporated herein by reference.

(8) Filed as an Exhibit to the Registrant's definitive proxy statement dated
May 19, 2005 with respect to the Annual meeting held on June 16, 2005, and
incorporated herein by reference.

(9) Filed as an Exhibit to the Registrant's Form 10-KSB for the Fiscal Year
Ended September 30, 2003 and incorporated herein by reference.

(10) Filed as an Exhibit to the Registrant's Form 8-K dated April 12, 2006 and
filed April 17, 2006, and incorporated herein by reference.

(11) Filed as an Exhibit to the Registrant's Form 10-QSB for the Quarter Ended
December 31, 2000 and incorporated herein by reference.

(12) Filed as an Exhibit to the Registrant's Form 10-KSB for the Fiscal Year
Ended September 30, 2001 and incorporated herein by reference.

(13) Filed as an Exhibit to the Registrant's Form 10-QSB for the Quarter Ended
March 31, 2004 and incorporated herein by reference.

(14) Filed as an Exhibit to the Registrant's Form 10-KSB for the Fiscal Year
Ended September 30, 2002 and incorporated herein by reference

(15) Filed as an Exhibit to the Registrant's Form 10-QSB/A for the Quarter
Ended March 31, 2006 and incorporated herein by reference.

(16) Filed as an Exhibit to the Registrant's Form 10-QSB for the Quarter Ended
June 30, 2001 &and incorporated herein by reference.

(17) Filed as an Exhibit to the Registrant's Form 10-QSB for the Quarter Ended
June 30, 2002 and incorporated herein by reference.

(18) Filed as an Exhibit to the Registrant's Form 10-KSB for the Fiscal Year
Ended September 30, 2006 and incorporated herein by reference.

(19) Filed herewith.

ITEM 28 - UNDERTAKINGS.

The undersigned registrant hereby undertakes:

(1) To file, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to:

(i) Include any prospectus required by Section 10(a)(3) of the
Securities Act;

(ii) 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.
Notwithstanding the foregoing, any increase or decrease in
volume of the securities offered (if the total dollar value of

II-8

securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of a
prospectus filed with the Commission pursuant to Rule 424(b)
if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum
offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;

(iii) Include any additional or changed material information on the
plan of distribution;

(2) That, for the purpose of determining any liability under the
Securities 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 bona fide offering thereof.

(3) To file a post-effective amendment to remove from registration any
of the securities that remain unsold at the end of the offering.

Insofar as indemnification arising under the Securities 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 of 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.

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SIGNATURES

In accordance with 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 SB-2 and authorized this registration
statement to be signed on its behalf by the undersigned in the city of Savage,
Minnesota, on January 24, 2007.

GREENMAN TECHNOLOGIES, INC.
(Registrant)

By: /s/ Charles E. Coppa
Charles E. Coppa
Chief Financial Officer

We, the undersigned directors and officers of GreenMan Technologies, Inc.,
hereby severally constitute and appoint Lyle Jensen and Charles E. Coppa, and
each of them acting singly, our true and lawful attorney-in-fact and agent, with
full power of substitution and re-substitution for him and in his name, place
and stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and any subsequent
registration statements pursuant to Rule 462 of the Securities Act of 1933, as
amended, and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorney-in-fact and agent, full power and authority to do and perform each
and every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said attorney-in-fact or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

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

Signature Title Date
--------- ----- ----

/s/ Lyle Jensen Chief Executive Officer and January 24, 2007
Lyle Jensen President (principal executive
officer); Director

/s/ Charles E. Coppa Chief Financial Officer January 24, 2007
Charles E. Coppa (principal financial and
accounting officer)

/s/ Maurice E. Needham Chairman of the Board of January 24, 2007
Maurice E. Needham Directors

/s/ Allen Kahn Director January 24, 2007
Dr. Allen Kahn

/s/ Lew F. Boyd Director January 24, 2007
Lew F. Boyd

/s/ Nicholas DeBenedictis Director January 24, 2007
Nicholas DeBenedictis

II-10