<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 27, 1999
REGISTRATION NO. 333-71663
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
AMENDMENT NO. 2
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. WILLIAM M. STUEK
CHIEF EXECUTIVE OFFICER
SYSTEM SOFTWARE ASSOCIATES, INC.
500 WEST MADISON STREET, 32ND FLOOR
CHICAGO, ILLINOIS 60661
(312) 258-6000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
WILLIAM N. WEAVER, JR., ESQ.
SACHNOFF & WEAVER, LTD.
30 SOUTH WACKER DRIVE, 29TH FLOOR
CHICAGO, ILLINOIS 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 filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
--------------------------------------
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.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
- --------------------------------------------------------------------------------
SUBJECT TO COMPLETION, DATED APRIL 27, 1999
50,522 SHARES
SYSTEM SOFTWARE ASSOCIATES, INC.
COMMON STOCK
This prospectus covers 50,522 shares of the common stock of System Software
Associates, Inc., a Delaware Corporation. All of the shares are being offered by
Riz Shakir. We will not receive any of the proceeds from the sale of the shares.
We have not made any underwriting arrangements with respect to the shares. Our
common stock is quoted on the Nasdaq National Market under the symbol SSAX. On
April 23, 1999, the last sale price reported was $2.25.
-----------
This investment involves risk. See "risk factors" beginning on page 3.
-----------
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 May __, 1999.
<PAGE>
Table of Contents
Risk Factors................................................ 3
Available Information....................................... 6
Incorporation of Certain Documents by Reference............. 6
The Company................................................. 7
Proceeds Of the Offering.................................... 8
Selling Stockholder......................................... 8
Plan of Distribution and Offering Price..................... 9
Validity of Stock........................................... 10
Experts..................................................... 10
2
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RISK FACTORS
Before you invest in our common stock, you should be aware that there
are various risks, including those described below. You should carefully
consider these risk factors, together with all of the other information included
in this prospectus, before you decide whether to purchase shares of our common
stock.
We Have a Recent History of Financial Losses That May Continue for the Balance
of the 1999 Fiscal Year.
We have experienced net losses for the fiscal year ended October 31,
1998 and the first quarter of fiscal 1999. Net losses for the fiscal year ended
October 31, 1998 were approximately $128.7 million. Net losses for the fiscal
quarter ended January 31, 1999 were approximately $5.1 million. At October 31,
1998, we had a retained earnings deficit of $52.9 million.
While we anticipate that we will reduce the level of our operating
losses by the end of the fiscal year ending October 31, 1999, there can be no
guarantees that this will occur. The amount of net losses and the time required
to reach profitability are uncertain. There can be no assurance that we will
ever be able to generate sufficient revenue from our products now ready for
market or those under development to achieve profitability on a sustained basis.
Our Indebtedness Can Have Adverse Consequences To Us and To You.
We have a substantial amount of debt. This debt load may:
. adversely affect our ability to obtain additional financing;
. make us more vulnerable to general economic and market conditions,
industry downturns and competitive pressures;
. impair our ability to fund research and development and respond to
technological changes; and
. result in us having to dedicate cash generated from operating
activities to the payment of debt service and other financing
obligations, thereby reducing funds available for operations, our
existing markets and our future business opportunities.
Absent Significant Positive Cash Flow, Our Business May Require Substantial
Additional Financing, and if We Do Not Obtain That Financing, We May Be Unable
to Manage Our Business Competitively.
Absent significant positive cash flow from the operation of our
business, we may require substantial additional financing on a continuing basis
for research and development, sales and marketing, recruiting and training
personnel, making scheduled interest payments and other purposes. In the
absence of improved profitability, there can be no guarantee that we will be
able to issue additional debt or sell stock or other additional equity on
satisfactory terms, or at all, to meet our future financing needs. If we could
not refinance our debt or obtain new loans, we would likely have to consider
various options such as the sale of additional equity or some of our assets to
meet the principal and interest payments we owe, negotiate with lenders to
restructure existing loans or explore other options available under applicable
laws. We cannot guarantee that any options available to us would enable us to
repay our debt in full.
3
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The ERP Application Software Market is Subject To Strong Competition From
Several Sources That Could Adversely Affect Revenue or Revenue Growth.
The software market for enterprise resource Planning ("ERP") Software
Packages is highly competitive, rapidly changing and significantly affected by
the introduction of new products and other market activities of our competitors.
Our primary competition comes from a large number of independent software
vendors and other sources. These competitors include companies offering products
that run on UNIX-based systems in a client/server environment such as Oracle
Corporation, Baan Company N.V. and, in particular, SAP AG. Other competitors
include companies offering products that run on AS/400 and other mid-range
computers, including J.D. Edwards, QAD and JBA.
Advantages that our competitors may have over us include:
. historical market presence;
. greater financial, technical, marketing and other resources;
. greater name recognition; and
. more customers who have their UNIX-based or client/server products
already installed.
Our Competitors Have More Established Relationships With Third Party Consultants
Who Make Recommendations About and Implement ERP Systems.
For our client/server ERP systems, we and our customers rely on a
number of consulting and systems integration companies for implementation of our
products, and other customer support services, as well as recommendations of our
products during the evaluation stage of our customers' purchase process. Many of
these third parties maintain similar, and usually more established,
relationships with our main competitors. If we are unable to develop and retain
effective, long-term relationships with a sufficient number of these third
parties, our competitive position could be materially adversely affected.
The SEC is Investigating Us and Has Tentatively Concluded That Our Revenue
Recognition Policies were Improper.
Since October 1995, we have been the subject of a private
investigation by the SEC. The inquiry primarily relates to revenue recognition
issues. The Staff of the Enforcement Division has advised us that it has
tentatively concluded that in past years we had improperly recognized revenue on
software contracts for UNIX based software products and software reseller
contracts, and in so doing violated various provisions of the federal securities
laws. We are unable to predict at this time the consequences to us of the SEC's
investigation. There can be no assurance that any actions taken by the SEC may
not have a material adverse effect on our ability to market our products in the
competitive environment in which we serve.
Our Dependence on the IBM AS/400 May Be a Risk.
In recent years, over 85% of our software license fee revenue was
derived from the AS/400 market. A substantial portion of our future revenues
will likely be derived from and will depend upon the continued widespread use of
AS/400 computers and the continued support by IBM of its AS/400 hardware
platform. We do not know if our customers will continue to use, or
4
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if IBM will continue to support, the AS/400. If use of this platform declines,
our business may be adversely affected.
We Have a New Management Team That Does Not Have Proven Success With the
Company.
During the fiscal year ended October 31, 1998, William M. Stuek was elected
our Chief Executive Officer, Lawrence A. Zimmerman was elected Chief Financial
Officer and Lorraine Fenton became our Vice President of Research and
Development. All of the new members of our management team have joined us
within the last fiscal year and all of them came from the IBM Corporation. It is
too early to tell whether this new executive management team will be successful
in managing our business affairs. Should they not be successful, our business
could be adversely affected.
Forward-Looking Statements
Some of the information in this prospectus contains forward-looking
statements that involve substantial risks and uncertainties. You can identify
such statements by forward-looking words such as "may," "will," "expect,"
"anticipate," "believe," "estimate," and "continue" or similar words. You should
read statements that contain these words carefully because they:
. discuss our future expectations;
. contain projections of our future results of operations or of our
financial condition; or
. state other "forward-looking" information.
We believe it is important to communicate our expectations to our investors.
However, there may be events in the future which we are not be able to
accurately predict or over which we have no control. The risk factors listed in
this section, as well as any cautionary language in this prospectus, provide
examples of risks, uncertainties and events which may cause our actual results
to differ materially from the expectations we describe in our forward-looking
statements. Before you invest in our common stock, you should be aware that the
occurrence of the events described in these risk factors and elsewhere in this
prospectus could have a material adverse effect on our business, operating
results and financial condition.
5
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AVAILABLE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file at the
following locations:
. At the Public Reference Room of the SEC, Room 1024 - Judiciary Plaza, 450
Fifth Street, N.W., Washington, DC 20549;
. At the public reference facilities at the SEC's regional offices located at
Seven World Trade Center, 13th Floor, New York, New York 10048 or
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661;
. By writing to the SEC, Public Reference Section, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, DC 20549;
. At the offices of the National Association of Securities Dealers, Inc.,
Reports Section, 1735 K Street, N.W., Washington, DC 20006; or
. From the Internet site maintained by the SEC at http://www.sec.gov. which
contains reports, proxy and information statements and other information
regarding issuers that file electronically with the SEC.
Some locations may charge prescribed or modest fees for copies.
We have filed with the SEC a Registration Statement on Form S-3 under the
Securities Act of 1933 covering the shares of common stock offered hereby. As
permitted by the SEC, this prospectus, which constitutes a part of the
Registration Statement, does not contain all the information included in the
Registration Statement. Such additional information may be obtained from the
locations described above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring to these documents. The information
incorporated by reference is considered to be part of this prospectus, and
information that we file with the Commission later will automatically update and
supersede this information. We incorporate by reference the documents listed
below and any future filings made with the SEC under Sections 13(a), 13(c), 14
or 15(d) of the Securities and Exchange Act of 1934 until Mr. Shakir sells all
of the common stock. This prospectus is part of a Registration Statement that
we filed with the SEC.
1. our Annual Report on Form 10-K for the fiscal year ended October 31, 1998,
filed on January 29, 1999, as amended on Form 10-K/A on March 2, 1999;
2. our Current Report on Form 8-K, filed on February 18, 1999;
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3. the description of the our common stock contained in our Registration
Statements on Form 8-A, declared effective February 12, 1987 and February 18,
1999;
4. our Quarterly Report on Form 10-Q for the fiscal quarter ended January 1,
1999, filed on March 17, 1999; and
5. our Proxy Statement on Form 14A, filed on March 4, 1999.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address: Investor Relations Department, System
Software Associates, Inc., 500 West Madison Street, 32nd Floor, Chicago IL
60661, Telephone: (312) 258-6000.
THE COMPANY
We are a worldwide provider of cost-effective, company-wide computer
software information systems to the industrial sector. Our "Business Planning
and Control System" ("BPCS") product line provides businesses with information
systems that assist them in streamlining and more effectively managing their
manufacturing and distribution processes, together with assisting them in
performing their human relations functions. These human relations functions
include the administration of payroll and benefit programs. In addition, our
BPCS product line assists businesses in producing financial reports and
otherwise managing their finances. Distinct features of the Business Planning
and Control System product line can be added or subtracted by a business as the
needs of that business change. We market, sell and service our product lines to
large- and intermediate-sized industrial sector firms primarily through our own
world-wide sales organization and, to a much lesser extent, through a network of
over 100 independent software companies. We have strategic relationships with
major computer hardware manufacturers, such as IBM, Hewlett Packard and Digital
Equipment; supply chain management software companies, such as i2 and
Manugistics; and major systems integrators, such as CAP Gemini and the Big Five
consulting firms.
Our executive offices are located at 500 West Madison Street, 32nd Floor,
Chicago, IL 60661. Our telephone number is (312) 258-6000.
7
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PROCEEDS OF THE OFFERING
We will not receive any of the proceeds from the sale of any of the shares by
Riz Shakir.
SELLING STOCKHOLDER
Until August 31, 1998, we employed Mr. Shakir as our Executive Vice
President of Research and Development. We issued 50,522 shares of our common
stock to Riz Shakir pursuant to a Consulting Agreement and General Release dated
as of September 1, 1998 between us and him.
Mr. Shakir beneficially owns 147,535 shares of our common stock. Included
in Mr. Shakir's beneficially owned shares are options, exercisable within sixty
(60) days from the date hereof, to purchase 52,569 shares of our common stock.
Beneficial ownership is determined in accordance with the rules of the SEC, and
includes voting and investment power with respect to the shares shown as
beneficially owned. The shares to be sold shall include, in addition to the
numbers indicated, any additional shares of our common stock 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 our common stock.
Only the 50,522 shares issued to Riz Shakir pursuant to the Consulting
Agreement and General Release are being offered by this prospectus. The
remaining 97,013 shares beneficially owned by Mr. Shakir have been either
previously registered by us for resale by Mr. Shakir, acquired by Mr. Shakir in
the open market, or have been granted to Mr. Shakir under our Long-Term
Incentive Plan. All shares issued under the Long-Term Incentive Plan have been
registered pursuant to a Form S-8. Accordingly, Mr. Shakir can sell all or none
of his 147,535 beneficially owned shares at any time. The percentage of
outstanding shares held by Riz Shakir prior to and after this offering
represents less than one percent of our outstanding shares.
The following table sets forth the number of shares Mr. Shakir beneficially
owned prior to this offering, the number of shares being offered by Mr. Shakir
in this offering and the number of shares to be beneficially owned by Mr. Shakir
after the offering, assuming that Mr. Shakir sells all of the shares being
offered in this offering.
<TABLE>
<CAPTION>
NUMBER OF
SHARES OWNED NUMBER OF NUMBER OF
PRIOR TO SHARES BEING SHARES AFTER
SELLING STOCKHOLDER OFFERING OFFERED THE OFFERING
- -------------------- --------------------------- --------------------------- -------------------------
<S> <C> <C> <C>
Riz Shakir 147,535 50,522 97,013
</TABLE>
8
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PLAN OF DISTRIBUTION AND OFFERING PRICE
Mr. Shakir may sell the shares from time to time. These sales may be made
on one or more exchanges or in the over-the-counter market, or otherwise. The
shares may be sold by any one or more of the following:
. 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;
. purchases by a broker or dealer as principal and resale by such broker
or dealer for its account pursuant to this prospectus;
. an exchange distribution in accordance with the rules of such exchange;
or
. ordinary brokerage transactions and transactions in which the broker
solicits purchasers.
In making these sales, Mr. Shakir may engage brokers or dealers to arrange for
other brokers or dealers to purchase the shares. Brokers and dealers will
receive commissions or discounts from Mr. Shakir in amounts to be negotiated
prior to the sale. Mr. Shakir and any brokers or dealers participating in the
distribution of the shares may be deemed to be "underwriters" within the meaning
of the Securities Act of 1933. Accordingly, any commissions received by these
broker-dealers and any profits realized on the resale of shares by them may be
deemed to be underwriting discounts and commissions under the Securities Act of
1933. Mr. Shakir may agree to indemnify these broker-dealers with respect to the
shares offered hereby against certain liabilities, including certain liabilities
under the Securities Act of 1933. In addition, we have agreed to indemnify Riz
Shakir with respect to the shares offered hereby against certain liabilities,
including certain liabilities under the Securities Act of 1933. If such
indemnity is unavailable, we will contribute toward amounts required to be paid
in respect of such liabilities. 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.
We will pay the registration expenses relating to the offering and sale of
the shares by Riz Shakir to the public. These expenses (estimated to be
$33,000), include legal and accounting expenses, filing fees payable to the SEC,
applicable state "blue sky" filing fees and printing expenses. We, however, will
not pay for any expenses, commissions or discounts of underwriters, dealers or
agents for Mr. Shakir.
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 Mr. Shakir.
Our 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 Mr.
Shakir, or his agent.
9
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VALIDITY OF STOCK
The validity of the shares will be passed upon for SSA by Sachnoff &
Weaver, Ltd., Chicago, Illinois. Between October 1992 and August 1998, in
consideration for the continued and future services on our Board of Directors of
William N. Weaver, Jr., we granted a total of 122,750 stock options to purchase
our shares to Sachnoff & Weaver, Ltd., of which Mr. Weaver is a member. These
options are exercisable between $4.625 and $7.8125 per share, and become
exercisable in equal portions on the five anniversaries of their respective
grant dates. Mr. Weaver disclaims beneficial ownership of all but his pro rata
portion of the shares covered by the options. Mr. Weaver personally owns 250,000
shares of our common stock.
EXPERTS
Our consolidated financial statements as of October 31, 1998 and 1997
and for the three years then ended have been incorporated by reference herein in
reliance upon the report of KPMG LLP, independent certified public accountants,
incorporated by reference herein and upon the authority of said firm as experts
in accounting and auditing.
10
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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 AMENDMENT NO.2 TO
THE REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED, IN THE CITY OF CHICAGO, STATE OF ILLINOIS, ON
APRIL 27, 1999.
System Software Associates, Inc.
By /s/ Kirk J. Isaacson
-----------------------------------
Kirk J. Isaacson
Vice President and General Counsel
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
NO. 2 TO THE REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS IN THE CAPACITIES AND ON THE DATES INDICATED.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
_________ ______ ____
<S> <C> <C>
Chief Executive Officer,
Chief Operating Officer,
President and Chairman of
/s/ William M. Stuek * the Board of Directors April 27, 1999
- ----------------------------------------
William M. Stuek
Executive Vice President,
Chief Financial Officer and
Director (Principal
/s/ Lawrence Zimmerman * Financial Officer) April 27, 1999
- ----------------------------------------
Lawrence Zimmerman
Vice President of Finance
and Controller (Principal
/s/ Joseph Skadra * Accounting Officer) April 27, 1999
- ----------------------------------------
Joseph Skadra
/s/ William N. Weaver, Jr. * Secretary and Director April 27, 1999
- ----------------------------------------
William N. Weaver, Jr.
/s/ Douglas Smith * Director April 27, 1999
- ----------------------------------------
Douglas Smith
Director April 27, 1999
- ----------------------------------------
Casey G. Cowell
Director April 27, 1999
- ----------------------------------------
Andrew J. Filipowski
* /s/ Douglas R. Newkirk
- ----------------------------------------
Douglas R. Newkirk
Attorney-in-Fact
</TABLE>
<PAGE>
EXHIBIT 5
(312) 207-1000
April 8, 1999
System Software Associates, Inc.
500 West Madison Street
32nd Floor
Chicago, Illinois 60661
Re: Registration Statement on Form S-3. ("Registration Statement")
Gentlemen and Ladies:
In connection with the proposed registration for resale of 50,522 shares of
Common Stock, $0.0033 par value (the "Common Stock"), of 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 the shares of
Common Stock registered for resale as set forth in the Registration Statement
have been duly authorized and were validly issued and 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-
referenced 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.
WNW/DRN
<PAGE>
EXHIBIT 23.1
CONSENT OF KPMG LLP
We consent to the incorporation by reference in this registration statement on
Form S-3 of our report dated December 10, 1998, relating to the consolidated
balance sheets of System Software Associates, Inc. and subsidiaries as of
October 31, 1998 and 1997, and the related consolidated statements of
operations, stockholders' equity, and cash flows for each of the years in the
three-year period ended October 31, 1998, and the related schedule of valuation
and qualifying accounts, which report appears in the October 31, 1998 annual
report on Form 10-K of System Software Associates, Inc. and to the reference to
our firm under the heading "Experts" in the prospectus.
/s/ KPMG LLP
Chicago, Illinois
April 7, 1999
