-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DgfYIG7P/yACO1yC7+FTS51Lng4Y8fB5XNYYI42OKbtFrXMgArzKm4q23MCrm4HA tz3CFgvPHF5bVcvIT0JC7w== 0000950131-97-000741.txt : 19970221 0000950131-97-000741.hdr.sgml : 19970221 ACCESSION NUMBER: 0000950131-97-000741 CONFORMED SUBMISSION TYPE: S-3DPOS PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 19970211 EFFECTIVENESS DATE: 19970211 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: SYSTEM SOFTWARE ASSOCIATES INC CENTRAL INDEX KEY: 0000808207 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-PREPACKAGED SOFTWARE [7372] IRS NUMBER: 363144515 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: S-3DPOS SEC ACT: 1933 Act SEC FILE NUMBER: 333-09463 FILM NUMBER: 97524685 BUSINESS ADDRESS: STREET 1: 500 W MADISON ST 32ND FLR CITY: CHICAGO STATE: IL ZIP: 60661 BUSINESS PHONE: 3126412900 S-3DPOS 1 POST-EFFECTIVE AMENDMENT NO. 1 TO FORM S-3 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 11, 1997 REGISTRATION NO. 333-09463 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------- POST-EFFECTIVE AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 --------------- SYSTEM SOFTWARE ASSOCIATES, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 36-3144515 (STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
500 WEST MADISON STREET, 32ND FLOOR CHICAGO, ILLINOIS 60661 (312) 641-2900 (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) MR. JOSEPH J. SKADRA CHIEF FINANCIAL OFFICER SYSTEM SOFTWARE ASSOCIATES, INC. 500 WEST MADISON STREET, 32ND FLOOR CHICAGO, ILLINOIS 60661 (312) 641-2900 (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE) COPIES TO: DOUGLAS R. NEWKIRK, ESQ. SACHNOFF & WEAVER, LTD. 30 SOUTH WACKER DRIVE CHICAGO, IL 60606 (312) 207-1000 --------------- APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this Registration Statement. If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [_] If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filer pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] --------------- 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. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 163,000 SHARES SYSTEM SOFTWARE ASSOCIATES, INC. COMMON STOCK $.0033 PAR VALUE All of the shares being offered hereby (the "Shares") are presently outstanding shares of the Common Stock of System Software Associates, Inc., a Delaware corporation ("SSA" or the "Company") and are being sold by those stockholders of the Company who are named herein under "Selling Stockholders." The Company will not receive any of the proceeds from the sale of these Shares. SSA Common Stock is quoted on the Nasdaq National Market under the symbol SSAX. On February 3, 1997, the last sale price reported was $10.125. This Prospectus is to be used in connection with the sale of the Shares from time to time by the Selling Stockholders. The Shares may be sold from time to time by the Selling Stockholders, directly or through underwriters, dealers or agents, in market transactions or in privately-negotiated transactions. The price at which any of the Shares may be sold, and the commissions, if any, paid in connection with any sale, may be privately negotiated, may be based on then prevailing market prices, and may vary from transaction to transaction and as a result are not currently known. See "Plan of Distribution and Offering Price." The Company will pay certain of the expenses of this offering (currently estimated at $22,000) except that each Selling Stockholder will bear the cost of any brokerage commissions or discounts incurred in connection with the sale of his, her or its Shares. See "Plan of Distribution and Offering Price." ---------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURI- TIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ---------------- The date of this Prospectus is , 1997. No dealer, salesperson or other person has been authorized to give any information or to make any representations not contained, or incorporated by reference, in this Prospectus and, if given or made, such information or representation must not be relied upon as having been authorized by the Company or the Selling Stockholders. This Prospectus does not constitute an offer to sell or the solicitation of any offer to buy any of the securities offered hereby in any jurisdiction to any person to whom it is unlawful to make such offer in such jurisdiction. Neither the delivery of this Prospectus nor any sale made hereunder shall, under any circumstances, create any implication that the information herein is correct as of any time subsequent to the date hereof or that there has been no change in the affairs of the Company since such date. RISK FACTORS In addition to the other information in this Prospectus, the following factors should be carefully considered in evaluating the Company and its business before purchasing the Shares offered hereby: NET LOSSES; UNCERTAINTY OF FUTURE RESULTS The Company has experienced operating and net losses in 1996. There can be no assurance that the Company will not continue to incur operating and net losses. The Company's future operating results will depend upon a number of business factors, including other factors discussed in these "Risk Factors," as well as general economic conditions. Furthermore, prior to a given year or other fiscal period, the Company hires sales and product development personnel and makes other decisions which will result in increased expenses in such year or other period, based upon anticipated revenues for such year or other period. Due to the seasonality and concentration of the Company's revenues at the end of fiscal periods, particularly the fourth quarter, and the Company's cost structure, if revenue targets are not met, the Company's operating results would be materially adversely affected. See "--Variability of Quarterly Operating Results; Seasonality." The Company has already made many of its hiring and other decisions with respect to expenditures for 1997. No assurances can be given that any of the Company's revenue expectations will be fulfilled, and the Company's business, results of operations and financial condition will be materially adversely affected if these expectations are not fulfilled. VARIABILITY OF QUARTERLY OPERATING RESULTS; SEASONALITY The Company's net revenues and operating results can vary, sometimes substantially, from quarter to quarter. The Company's revenues in general, and in particular its license fee revenues, are relatively difficult to forecast due to a number of reasons, including (i) the relatively long sales cycles for the Company's product, (ii) the size and timing of individual license transactions, (iii) the timing of the introduction of new product functionality by the Company or its competitors, (iv) the potential for delay or deferral of customer purchases of the Company's software, (v) changes in customer budgets and (vi) seasonality of technology purchases and other general economic conditions. In recent years, the Company has realized an increasingly high portion of total net revenues from individually large licenses which could contribute to greater quarterly variability. The Company has experienced a seasonal pattern in its operating results, with the fourth quarter typically having the highest total revenues and operating income. The Company believes that fourth fiscal quarter revenues are positively impacted by the Company's sales compensation plans. This factor, which the Company believes is common in the computer software industry, typically results in first quarter revenues in any year being lower than revenues in the immediately preceding fourth quarter. In addition, the Company's European operations generally provide lower revenues in the summer months as a result of the generally reduced economic activity in Europe at such time. This seasonal factor could adversely affect third quarter revenues. The Company's business planning and control software product (BPCS) is generally shipped as software licenses are finalized. As a result, license fee revenues in any quarter are substantially dependent on software license agreements finalized in that quarter. Because the Company's operating expenses are based on anticipated 2 revenue levels and because a high percentage of the Company's expenses are relatively fixed, a delay in the recognition of revenue from a limited number of license transactions could cause significant variations in operating results from quarter to quarter and could result in losses. The Company plans to increase expenditures in order to fund greater levels of research and development, a larger direct sales and marketing staff, development of new distribution and resale channels and broader customer support capability. To the extent such expenses precede or are not subsequently followed by increased revenues, the Company's operating results would be materially adversely affected. COMPETITION The enterprise resource planning ("ERP") application software market is highly competitive, is changing rapidly, and is significantly affected by new product introductions and other market activities of industry participants. The Company's BPCS product is targeted at the emerging market for open systems, client/server ERP software solutions, and the more mature IBM AS/400 ERP market. The Company's current and prospective competitors offer a variety of products and solutions to address these markets. The Company's primary competition comes from a large number of independent software vendors and other sources including (i) companies offering products that run on AS/400 and other mid-range computers including, Marcam Corporation and J.D. Edwards (each of which has recently introduced a client/server product), and (ii) companies offering products that run on Unix-based systems in a client/server environment such as Oracle Corporation (Oracle), Baan Company N.V. (Baan) and SAP AG. In addition, the Company faces indirect competition from suppliers of custom-developed business application software that have focused mainly on proprietary mainframe- and minicomputer-based systems with highly customized software, such as the systems consulting groups of major accounting firms and systems integrators. The Company also faces indirect competition from "home- grown" systems developed by the internal MIS departments of large organizations. Some of the Company's competitors have longer operating histories, greater financial, technical, marketing and other resources than the Company, greater name recognition, and a larger installed base of customers in the Unix-based, client/server ERP market. Further, because the Company's product runs on relational database management systems (RDBMS) and Oracle has the largest market share for RDBMS software, Oracle may have a competitive advantage in selling its application products to its RDBMS customer base. The Company may also face market resistance from the large installed base of legacy systems because of the reluctance of these customers to commit the time and effort necessary to convert to an open systems-based client/server software solution. Furthermore, as the client/server computing market develops, companies with significantly greater resources than the Company could attempt to increase their presence in this market by acquiring or forming strategic alliances with competitors of the Company. In the Unix-based market, the Company and its customers rely on a number of systems consulting and systems integration firms for implementation and other customer support services, as well as recommendations of the Company's product during the evaluation stage of the purchase process. Although the Company seeks to maintain close relationships with these third party implementation providers, many of these third parties have similar, and usually more established, relationships with the Company's principal competitors. If the Company is unable to develop and retain effective, long-term relationships with a sufficient number of these third parties, it would adversely affect the Company's competitive position. Further, there can be no assurance that these third parties, some of which have significantly greater financial, technical and marketing resources than the Company, will not market software product in competition with the Company in the future or will not otherwise reduce or discontinue their relationships with or support of the Company and its product. The Company believes that its future strength will depend in part on its ability to expand sales of BPCS for the client/server environment. Many of the Company's competitors currently offer applications products for client/server systems, and the Company believes that many of its other competitors, including certain large, well-established software companies, are actively developing client/server-based products. As a result, competition (including price competition) is likely to increase substantially, which could result in price reductions and loss of 3 market share. There can be no assurance that the Company will be able to compete successfully with existing or new competitors or that competition will not have a material adverse effect on the Company's business. RAPID TECHNOLOGICAL CHANGE The market for the Company's software product is characterized by rapid technological advances, evolving industry standards in computer hardware and software technology, changes in customer requirements and preferences, and frequent new introductions and enhancements. The Company's future success will depend upon its ability to continue to enhance its current product and to develop and introduce new product functionality that keeps pace with technological developments, satisfies increasingly sophisticated customer requirements and achieves market acceptance. In particular, the Company must continue to anticipate and respond adequately to advances in RDBMS software and desktop computer operating systems such as Windows. There can be no assurance that the Company will be successful in developing and marketing, on a timely and cost-effective basis, fully functional product enhancements or new product functionality that respond to technological advances by others, or that its new product functionality will achieve market acceptance. As a result of the complexities inherent in both the RDBMS and client/server environments and the broad functionality and performance demanded by customers for ERP products, major new product enhancements and new product functionality can require long development and testing periods to achieve market acceptance. In addition, software programs as complex as those offered by the Company may contain undetected errors or "bugs" when first introduced or as new versions are released that, despite rigorous testing by the Company, are discovered only after products has been installed and used by customers. The Company has on occasion experienced delays in the scheduled introduction of new and enhanced product functionality. There can be no assurance that errors will not be found in future releases of the Company's software, or that any such errors will not impair the market acceptance of the product and adversely affect operating results. Problems encountered by customers in installing and implementing new releases or with performance of the Company's product can be expected to occur, given the inherent complexities of its client/server based product. To the extent that the customer, its third party integrator and/or the Company are unable to adequately resolve such issues, it could have a material adverse effect on the Company's business and operating results. In this regard, in September 1996, the Company introduced the current release (Version 6.01) of its Business Planning and Control System applications product. Accordingly, SSA has only limited experience with fully implemented operations installations of Version 6.01 at customer sites. Because of such limited customer experience, and the inherent complexities of the client/server based product, there can be no assurance that this release will not require software modifications to satisfy performance requirements of customers or to fix previously undetected errors. If customers were to experience significant problems with the implementation and installation of this release or are dissatisfied with product functionality or performance, the Company's business, financial condition and results of operations could be materially, adversely affected. DEPENDENCE ON AS/400 USERS At the same time that the Company has developed new versions of its BPCS product for the client/server marketplace, the Company remains a leading supplier of ERP applications for IBM AS/400 installations in the industrial sector. In fiscal 1996, over 75% of the Company's revenue was derived from the Company's installed base of AS/400 users. Therefore, even as the Company continues to innovate and market versions of BPCS for the client/server environment, a substantial portion of the Company's future revenues will be derived from and dependent upon the continued widespread use of the AS/400 and the continued support of the AS/400 by IBM. While the Company believes that customers will continue to use and IBM will continue to support the AS/400 there can be no assurance of such continued use and/or support. The Company will be required and intends to continue to devote substantial resources to supporting its installed base of AS/400 customers and the version of BPCS used by them. The Company believes that many AS/400 users may convert to client/server activities. Although the Company believes it has an advantage in assisting its installed AS/400 base in converting to Unix-based versions of BPCS, there is no assurance that these customers will continue to use BPCS if they implement 4 client/server systems. The loss of a significant number of AS/400 customers could have a material adverse impact on the Company's business, operating results and financial condition. In addition, in order to retain its AS/400 customers, the Company may be required to adapt its BPCS product to any changes made in the AS/400 operating system in the future. The Company's inability to adapt to future changes in the AS/400 operating system, or delays in doing so, could have a material adverse effect on the Company's business, operating results and financial condition. ENTRY INTO UNIX MARKET; HIGHLY COMPLEX SALES ENVIRONMENT The Company has only recently developed and begun to market BPCS client/server for Unix operating environments. The market for open systems, client/server based applications differs in many respects from the market for AS/400 based applications which historically had been the Company's exclusive focus. Among other things, the Unix market is characterized by numerous database vendors, numerous hardware vendors and a greater number of systems integrators and consultants, all of whom can influence the purchase of enterprise applications such as those marketed by the Company. There can be no assurance that the Company's sales and marketing efforts will be successful in this highly complex sales environment. The Company's inability to implement successful sales and marketing efforts in the Unix market could have a material adverse effect on the Company's business, operating results and financial condition. LAWSUITS In January 1997, class action lawsuits were filed in state court in Illinois and in the federal court in Chicago, Illinois against the Company and certain of its officers. The federal actions allege damages to persons who purchased the Company's Common Stock during the period August 22, 1994 through January 7, 1997 arising from alleged violations of the federal securities laws and associated common laws. The state court action alleges damages to persons who purchased the Company's Common Stock during the period November 21, 1994 through January 7, 1997 arising from alleged violations of the Illinois securities laws and associated statutory and common law. The lawsuits name the Company and several of its officers and directors as defendants, and allege violations of securities laws, fraud and negligence in connection with the restatement of the Company's financial statements for the fiscal years ended 1994 and 1995. The complaints do not specify the amounts of damages sought. Although the outcome of these proceedings cannot be determined with certainty, the Company intends to defend the actions vigorously, and, in consultation with its legal counsel, believes that the allegations are without merit and that the final outcomes should not have a material adverse effect on the Company's operations or financial position. INTERNATIONAL OPERATIONS The Company currently operates in over 50 countries. The Company's operations are subject to risks inherent in international business activities, including, in particular, general economic conditions in each country, overlap of different tax structures, management of an organization spread over various countries, exposure to currency fluctuations, unexpected changes in regulatory requirements, compliance with a variety of foreign laws and regulations, and longer accounts receivables payment cycles in certain countries. Other risks associated with international operations include import and export licensing requirements, trade restrictions and changes in tariff rates. RELIANCE ON CERTAIN RELATIONSHIPS In the Unix-based marketplace, the Company relies on a number of consulting and systems integration firms to enhance its marketing, sales and customer support efforts, particularly with respect to implementation and support of its product as well as lead generation and assistance in the sales process. As the Company continues to implement its strategy of focusing on the licensing of its product in the Unix-based marketplace, the Company will become increasingly dependent upon third party implementation providers for product implementation, end 5 user training and sales support. Although the Company seeks to maintain close relationships with these firms, many such firms have similar, and usually more established, relationships with the Company's principal competitors. There can be no assurance that these third party service firms will provide the level and quality of service required to meet the needs of the Company's end users, nor can there be any assurance that such service firms will recommend the Company's product to their clients when assisting their clients in product selection decisions. ABILITY TO ENFORCE THE COMPANY'S INTELLECTUAL PROPERTY RIGHTS The Company relies on a combination of the protections provided under applicable copyright and trade secret laws, as well as on confidentiality procedures and licensing arrangements, to establish and protect its rights in its software. Despite the Company's efforts, it may be possible for unauthorized third parties to copy certain portions of the Company's product or to reverse engineer or obtain and use information that the Company regards as proprietary. In addition, the laws of certain countries do not protect the Company's proprietary rights to the same extent as do the laws of the United States. Accordingly, there can be no assurance that the Company will be able to protect its proprietary software against unauthorized third party copying or use, which could adversely affect the Company's competitive position. CONTROL BY EXISTING STOCKHOLDER Roger E. Covey, Chairman and Chief Executive Officer of the Company, currently owns approximately 31.3% of the Company's outstanding Common Stock. Accordingly, Mr. Covey may have the effective power to influence significantly the outcome of matters submitted for stockholder action, including the election of members of the Company's Board and the approval of significant change in control transactions, and may be deemed to have control over the management and affairs of the Company. This significant equity interest in the Company may have the effect of making certain transactions more difficult absent the support of Mr. Covey and may have the effect of delaying or preventing a change in control of the Company. VOLATILITY OF STOCK PRICE The market prices for securities of technology companies have been volatile. Announcements of technological innovations by the Company or its competitors, developments concerning proprietary rights and economic or other external factors may have a significant impact on the Company's business and on the market price of the Common Stock. Fluctuations in financial performance from period to period also may have a significant impact on the market price of the Common Stock. ANTI-TAKEOVER CONSIDERATIONS The Company is subject to Section 203 of the Delaware General Corporation Law which, subject to certain exceptions, prohibits a Delaware corporation from engaging in any of a broad range of business combinations with an "interested stockholder" for a period of three years following the date that such stockholder became an interested stockholder. The Company has also adopted a stockholders rights plan, which can have a significant anti-takeover effect by inhibiting a potential offeror, the value of whose acquired shares would be substantially diluted by the operation of the plan. A change of control, as defined in the Company's principal credit facilities, constitutes an event of default in such credit facilities. These provisions could serve to impede or prevent a change of control or have a depressive effect on the price of the Company's equity securities. AVAILABLE INFORMATION SSA is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance therewith, files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Reports, proxy and information statements and other 6 information filed by the Company with the Commission pursuant to the informational requirements of the Exchange Act may be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the Commission's regional offices located at Seven World Trade Center, 13th Floor, New York, New York 10048, and Northwestern Atrium Center, 500 West Madison Street, 32nd Floor (Suite 1400), Chicago, Illinois 60661; and copies of such material may be obtained from the Public Reference Section of the Commission, Washington, D.C. 20549, at prescribed rates. Copies of reports, proxy and information statements and other information are available on the Commission's Web site at http://www.sec.gov. This Prospectus constitutes a part of a Registration Statement on Form S-3 (the "Registration Statement") filed by the Company with the Commission under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the Shares offered hereby. In accordance with the rules and regulations of the Commission, this Prospectus omits certain of the information contained in the Registration Statement. Reference is hereby made to the Registration Statement and related exhibits for further information with respect to the Company and the Company's Common Stock. Statements contained herein concerning the provisions of any document are not necessarily complete and, in each instance, reference is made to the copy of such document filed as an exhibit to the Registration Statement or otherwise filed with the Commission. Each such statement is qualified in its entirety by such reference. The Registration Statement, including the exhibits and schedules thereto, is also available on the Commission's Web site at http://www.sec.gov. INFORMATION INCORPORATED BY REFERENCE The Company incorporates herein by reference the following documents it has previously filed with the Commission (File No. 0-15322) pursuant to the Exchange Act: (a) the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 1996; (b) the description of the Company's Common Stock contained in the Company's Registration Statement on Form 8-A, declared effective February 12, 1987; and (c) the description of the Company's Common Stock Purchase Rights contained in the Company's Registration Statement on Form 8-A, filed May 18, 1988. All documents and reports subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of the offering of the Shares shall be deemed to be incorporated herein by reference and to be a part hereof from the date of filing of such documents. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document that also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will furnish without charge to each person, including any beneficial owner, to whom this Prospectus is delivered, upon the written or oral request of such person, a copy of any or all the documents incorporated herein by reference, other than exhibits to such documents unless such exhibits are specifically incorporated by reference in such documents, and any other documents specifically identified herein as incorporated by reference into the Registration Statement to which this Prospectus relates or into such other documents. Requests should be addressed to: Investor Relations Department, System Software Associates, Inc., 500 West Madison Street, 32nd Floor, Chicago IL 60661, Telephone: (312) 641-2900. 7 THE COMPANY SSA is a leading provider of cost-effective business enterprise information systems to the industrial sector worldwide. SSA's BPCS (Business Planning and Control System) product provides business process re-engineering and integration of an enterprise's operations, including multi-mode manufacturing processes, supply chain management and global financial solutions. The BPCS Client/Server solution delivers scaleability, interoperability and reconfigurability in its comprehensive product suite to meet changing market demands. The distributed object computing architecture of BPCS Client/Server provides the benefits of next generation technology in conformity with industry standards. The Company markets, sells and services its product to intermediate and large size enterprises through its own worldwide sales organization and a worldwide network of approximately 90 independent software companies and major systems integrators. The Company's executive offices are located at 500 West Madison Street, 32nd Floor, Chicago, IL 60661. The Company's telephone number is (312) 641-2900. SELLING STOCKHOLDERS The Company issued a total of 163,000 shares of its Common Stock on June 28, 1996, in exchange for substantially all of the outstanding common stock of Computer Options, Inc., a Minnesota Corporation doing business as SSA North Central, Inc. ("NC"), an Affiliate of the Company and one of the leading application software providers in Minnesota. As a result of the transaction, NC became a wholly-owned subsidiary of the Company. Except with respect to their respective ownership of NC, prior to the closing, the Selling Stockholders had no material relationship with SSA or any of its predecessors or affiliates within the past three years. Messrs. Kerrison and Solfelt are both currently employees of the Company. The following table sets forth the names of the Selling Stockholders and the respective numbers of shares of the Company's Common Stock owned by each of them. As of the date hereof, all of such shares are being offered by such Selling Stockholders by means of this Prospectus. In each case, the percentage of outstanding shares of the Company's Common Stock held by each Selling Stockholder prior to and after the offering to which this Prospectus relates represents less than one percent (1%) of the outstanding shares of the Company's Common Stock.
NUMBER OF SELLING STOCKHOLDERS SHARES (1) -------------------- ---------- David L. Faidley............................................. 6,132 Michael G. Kerrison.......................................... 130,724(2) Robert J. Solfelt............................................ 26,144
- -------- (1) The shares to be sold shall include, in addition to the numbers indicated, any additional shares of Common Stock of SSA that become issuable in connection with the Shares 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 outstanding shares of the Company's Common Stock. (2) Does not include 15,000 shares obtainable under options which are not exercisable currently or within 60 days after the date of this Prospectus. PLAN OF DISTRIBUTION AND OFFERING PRICE The Shares may be sold from time to time by the Selling Stockholders, or by pledgees, donees, transferees or other successors in interest. Such sales may be made on one or more exchanges or in the over-the-counter market, or otherwise at prices and at terms then prevailing or at prices related to the then current market price, or in negotiated transactions. The Shares may be sold by one or more of the following: (a) a block trade in which the broker or dealer so engaged will attempt to sell the Shares as agent but may purchase and resell a portion of the block as principal to facilitate the transaction; (b) purchases by a broker or dealer as principal and resale by such broker or dealer for its account pursuant to this Prospectus; (c) an exchange distribution in accordance with 8 the rules of such exchange; and (d) ordinary brokerage transactions and transactions in which the broker solicits purchasers. In effecting sales, brokers or dealers engaged by the Selling Stockholders may arrange for other broker or dealers to participate. Brokers or dealers will receive commissions or discounts from Selling Stockholders in amounts to be negotiated prior to the sale. Such brokers or dealers and any other participating brokers or dealers may be deemed to be "underwriters" within the meaning of the Securities Act in connection with such sales. In addition, any securities covered by this Prospectus which qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than pursuant to this Prospectus. The Company will pay the registration expenses incident to the offering and sale of the Shares by the Selling Stockholders to the public. Such expenses include legal and accounting expenses, filing fees payable to the Commission, applicable state "blue sky" filing fees and printing expenses. The Company, however, will not pay for any expenses, commissions or discounts of underwriters, dealers or agents for the Selling Stockholders. The Company has agreed to pay the fees and expenses of one counsel for all of the Selling Stockholders, provided that such fees do not exceed $10,000. Any underwriters, brokers, dealers and agents who participate in any such sale may also be customers of, engage in transactions with or perform services for SSA or the Selling Stockholders in the ordinary course of business. SSA Common Stock is currently traded on the Nasdaq National Market. The public offering price for any Shares that are sold will be determined by the price indicated on such system at the time such sale occurs, or at such price as shall be determined through private negotiations between the buyer and the Selling Stockholders, or their respective agents. VALIDITY OF STOCK The validity of the Shares will be passed upon for the Company by Sachnoff & Weaver, Ltd., Chicago, Illinois ("S&W"). In October 1992, in consideration for the continued and future services on the Company's Board of Directors of William N. Weaver, Jr., the Company granted a stock option to S&W, of which Mr. Weaver is a member. This option covers 33,750 shares, is exercisable at $10.3889 per share (the fair market value of the Company's Common Stock on October 12, 1992, the date the options were granted) and becomes exercisable in equal portions on the five anniversaries of the grant date. In consideration of the option grant, S&W agreed to waive its fees for Mr. Weaver's time expended attending meetings of the Board of Directors. In December 1994, the Company granted S&W additional options to purchase 22,500 shares. The later options are exercisable at $9.83 per share, the fair market value of the Company's Common Stock on the date of grant, and become exercisable in equal portions on the five anniversaries of the grant date. In addition to his beneficial ownership of the shares subject to the foregoing options, Mr. Weaver personally owns 300,000 shares of the Company's Common Stock. EXPERTS The financial statements as of October 31,1996 and for the year then ended incorporated in this Prospectus by reference to the Annual Report on Form 10-K of System Software Associates, Inc. for the year ended October 31, 1996 have been so incorporated in reliance on the report of KPMG Peat Marwick LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. The financial statements as of October 31, 1995 and 1994 and for each of the two fiscal years in the period ended October 31, 1995 incorporated in this Prospectus have been so included in reliance on the report of Price Waterhouse LLP, independent accountants, given on the authority of said firm as experts in auditing and accounting. 9 PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The expenses in connection with the issuance and distribution of the securities being registered, other than underwriting compensation, are: SEC Filing Fee for Registration Statement........................ $ 737 Accounting Fees.................................................. 5,000* Legal Fees and Expenses.......................................... 15,000* Miscellaneous.................................................... 1,263* ------- Total........................................................ $22,000 =======
- -------- *Estimated Amount All of the expenses listed above will be borne by the Registrant. ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The By-laws of the Registrant provide that the Registrant shall indemnify its officers and directors to the fullest extent permitted by applicable law. Section 145 of the Delaware General Corporation Law (the "DGCL") provides, in general, that each director and officer of a corporation may be indemnified against expenses (including attorneys' fees, judgments, fines and amounts paid in settlement) actually and reasonably incurred in connection with the defense or settlement of any threatened, pending or completed legal proceedings in which he is involved by reason of the fact that he is or was a director or officer if he acted in good faith and in a manner that he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, if he had no reasonable cause to believe that his conduct was unlawful. If the legal proceeding, however, is by or in the right of the corporation, the director or officer may not be indemnified in respect of any claim, issue or matter as to which he shall have been adjudged to be liable for negligence or misconduct in the performance of his duty to the company unless a court determines otherwise. The Certificate of Incorporation of the Registrant, as amended to date, provides that the personal liability of the directors of the Registrant shall be eliminated to the fullest extent permitted by applicable law. The DGCL permits a corporation's certificate of incorporation to provide that no director of the corporation shall be personally liable to the corporation or its stockholders for monetary damages for any breach of his fiduciary duty as a director; provided, however, that such provision shall not apply to any liability of a director (1) for any breach of a director's duty of loyalty to the corporation or its stockholders, (2) for acts or omissions that are not in good faith or involve intentional misconduct or a knowing violation of the law, (3) under Section 174 of the DGCL or (4) for any transaction from which the director derived an improper personal benefit. ITEM 16. EXHIBITS. (a) Exhibits: 4.1 Certificate of Incorporation, as amended to date (1) 4.2 By-Laws, as amended to date (2) 4.3 Rights Agreement Dated as of May 3, 1988 (3) 5 Opinion of Sachnoff & Weaver, Ltd. regarding the legality of the securities being registered 23.1 Consent of Price Waterhouse LLP 23.2 Consent of KPMG Peat Marwick LLP 23.3 Consent of Sachnoff & Weaver, Ltd. (included in Exhibit 5) 24 Powers of Attorney (included on the Signature Page of this Registration Statement)
- -------- (1) Incorporated by reference from the Registrant's Form 10-K Annual Report for the fiscal year ended October 31, 1987 (File No. 0-15322). II-1 (2) Incorporated by reference from the Registrant's Form 10-K Annual Report for the fiscal year ended October 31, 1989 (File No. 0-15322). (3) Incorporated by reference from the Registrant's Form 8-K Current Report filed on May 18, 1988 (File No. 0-15322). ITEM 17. UNDERTAKINGS. (a) The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (h) Insofar as indemnification for liabilities arising under the Securities Act of 1933 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 the indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-2 SIGNATURES PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF CHICAGO, STATE OF ILLINOIS, ON FEBRUARY 11, 1997. System Software Associates, Inc. /s/ Joseph J. Skadra By___________________________________ Joseph J. Skadra, Vice President and Chief Financial Officer February 11, 1997 PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED.
SIGNATURE TITLE DATE --------- ----- ---- * Chief Executive Officer and February 11, 1997 ____________________________________ Chairman of the Board of Roger E. Covey Directors (Principal Executive Officer) /s/ Joseph J. Skadra Chief Financial Officer, February 11, 1997 ____________________________________ Vice President--Finance Joseph J. Skadra and Secretary (Principal Financial and Accounting Officer) Director February , 1997 ____________________________________ Andrew J. Filipowski * Director February 11, 1997 ____________________________________ John W. Puth Director February , 1997 ____________________________________ Dr. Willard Zangwill * Director February 11, 1997 ____________________________________ William N. Weaver, Jr.
/s/ Joseph J. Skadra *By: __________________________ Joseph J. Skadra Attorney-in-fact II-3 EXHIBIT INDEX
SEQUENTIALLY EXHIBIT NUMBERED NUMBER DESCRIPTION OF DOCUMENT PAGE - ------- ----------------------- ------------ 4.1 Certificate of Incorporation, as amended to date (1) 4.2 By-Laws, as amended to date (2) 4.3 Rights Agreement Dated as of May 3, 1988 (3) 5 Opinion of Sachnoff & Weaver, Ltd. regarding the legality of the securities being registered. 23.1 Consent of Price Waterhouse LLP.............................................................. 23.2 Consent of KPMG Peat Marwick LLP............................................................. 23.3 Consent of Sachnoff & Weaver, Ltd. (included in Exhibit 5) -- 24 Powers of Attorney (included on the Signature Page of this Registration Statement) --
- -------- (1) Incorporated by reference from the Registrant's Form 10-K Annual Report for the fiscal year ended October 31, 1987 (File No. 0-15322). (2) Incorporated by reference from the Registrant's Form 10-K Annual Report for the fiscal year ended October 31, 1989 (File No. 0-15322). (3) Incorporated by reference from the Registrant's Form 8-K Current Report filed on May 18, 1988 (File No. 0-15322). II-4 EX-5 2 OPINION OF SACHNOFF & WEAVER EXHIBIT 5 (312) 207-1000 February 11, 1997 System Software Associates, Inc. 500 West Madison Street 32nd Floor Chicago, Illinois 60661 Re: Post-Effective Amendment No. 1 to Registration Statement on Form S-3, No. 333-09463 ("Registration Statement") Gentlemen and Ladies: In connection with the proposed registration for sale of 163,000 shares of Common Stock, $0.0033 par value (the "Common Stock"), by System Software Associates, Inc. (the "Company"), covered by the above-referenced Registration Statement, we have examined such documents and have reviewed such questions of law as we have considered necessary and appropriate for the purposes of this opinion. We have assumed the genuineness of all signatures, the authenticity of all documents submitted to as originals, the conformity to original documents of all the documents submitted to us as certified or photostatic copies and the authenticity of the originals of such latter documents. Based upon such examination, we advise you that, in our opinion: (i) The Company had corporate authority to issue the shares of Common Stock registered for resale as set forth in the Registration Statement. (ii) The shares of Common Stock registered for resale as set forth in the Registration Statement have been duly authorized and validly issued and are fully paid and nonassessable, and will continue to be so when sold as set forth in the Registration Statement. We hereby consent to the filing of this opinion as an exhibit to the above- mentioned Registration Statement and the reference to this firm under the caption "Validity of Stock" in the Prospectus constituting a part of such Registration Statement. In giving this consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933 or the rules and regulations of the Securities and Exchange Commission. Very truly yours, /s/ Sachnoff & Weaver, Ltd. ------------------------------------- Sachnoff & Weaver, Ltd. EX-23.1 3 CONSENT OF PRICE WATERHOUSE LLP EXHIBIT 23.1 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Prospectus constituting part of this Registration Statement on Form S-3 of our report dated January 7, 1997, except as to Notes 6, 7 and 11, which are as of January 29, 1997, appearing on page F-3 of System Software Associates, Inc. Annual Report on Form 10-K for the year ended October 31, 1996. We also consent to the reference to us under the heading "Experts" in such Prospectus. /s/ Price Waterhouse LLP - ------------------------------------- Price Waterhouse LLP Chicago, Illinois February 6, 1997 EX-23.2 4 CONSENT OF KMPG PEAT MARWICK LLP EXHIBIT 23.2 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Prospectus constituting part of this Registration Statement on Form S-3 of our report dated January 7, 1997, except as to Notes 6, 7 and 11 which are as of January 29, 1997, appearing on page F-2 of System Software Associates, Inc. Annual Report on Form 10-K for the year ended October 31, 1996. We also consent to the reference to us under the heading "Experts" in such Prospectus. /s/ KPMG Peat Marwick LLP - ------------------------------------- KPMG Peat Marwick LLP Chicago, Illinois February 6, 1997 -----END PRIVACY-ENHANCED MESSAGE-----