<PAGE> 1
As filed with the Securities and Exchange Commission on August 16, 1996.
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
SPSS INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
DELAWARE 7372 36-2815480
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification Number)
</TABLE>
444 NORTH MICHIGAN AVENUE, CHICAGO, ILLINOIS 60611
(312) 329-2400
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
EDWARD HAMBURG
SENIOR VICE PRESIDENT, CORPORATE OPERATIONS, CHIEF FINANCIAL OFFICER, AND
SECRETARY
SPSS INC.
444 NORTH MICHIGAN AVENUE
CHICAGO, ILLINOIS 60611
(312) 329-2400
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPIES TO:
T. Stephen Dyer, Esq.
Ross & Hardies
150 N. Michigan Avenue
Chicago, Illinois 60601
(312) 558-1000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
If any of the securities being registered on this form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, check the following box. /X/
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Maximum Proposed Maximum
Title of Each of Offering Price Aggregate Amount of
Securities to be Registered Per Share(1) Offering Price(1) Registration Fee
<S> <C> <C> <C>
Common Stock, $.01 par value $23.25 $34,990,762 $12,066
</TABLE>
(1) Solely for the purpose of calculating the registration fee, the offering
price per share, the aggregate offering price and the amount of the
registration fee have been computed in accordance with Rule 457(c)
<PAGE> 2
under the Securities Act of 1933, as amended. Accordingly, the price
per share of Common Stock has been calculated to be equal to the average
of the high and low prices for a share of Common Stock as reported by
the Nasdaq National Market on August 12, 1996, which is a specified date
within five business days prior to the original date of filing of this
Registration Statement.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE> 3
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BY ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
PRELIMINARY PROSPECTUS
SUBJECT TO COMPLETION
AUGUST 16, 1996
PROSPECTUS
1,504,979 SHARES
SPSS INC.
COMMON STOCK
($.01 PAR VALUE)
This Prospectus relates to the offer and sale of up to 1,504,979 shares
of the common stock, $.01 par value (the "Common Shares" or "Common Stock"), of
SPSS Inc. (the "Company"). The Common Shares may be offered by particular
stockholders of the Company (the "Selling Stockholders") from time to time in
transactions on the Nasdaq National Market, in negotiated transactions, or a
combination of such methods of sale, at fixed prices that may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Stockholders may
effect such transactions by the sale of the Common Shares to or through
broker-dealers, and such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the Selling Stockholders and/or the
purchasers of the Common Shares for whom such broker-dealers may act as agent
or to whom they may sell as principal, or both (which compensation to a
particular broker-dealer might be in excess of customary commissions). The
Selling Stockholders and any broker-dealer who acts in connection with the sale
of Common Shares hereunder may be deemed to be "underwriters" as that term is
defined in the Securities Act of 1933, as amended (the "Securities Act"), and
any commission received by them and profit on any resale of the Common Shares
as principal might be deemed to be underwriting discounts and commissions under
the Securities Act. See "Selling Stockholders" elsewhere in this Prospectus.
The Company will not receive any of the proceeds from the sale of the Common
Shares by the Selling Stockholders.
The Company's Common Stock is traded and quoted on the Nasdaq National
Market under the symbol "SPSS." On August 15, 1996, the last sale price of the
Common Stock, as reported on the Nasdaq National Market, was $23.375 per share.
The Company will bear all expenses (other than underwriting discounts and
selling commissions, and fees and expenses of counsel or other advisors to the
Selling Stockholders) in connection with the registration of the shares of
Common Stock being offered hereby, which expenses are estimated to be
approximately $60,625. See "Selling Stockholders" elsewhere in this
Prospectus.
SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE
CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE COMMON STOCK.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
----------------------------------------------
The date of this Prospectus is August 16, 1996
<PAGE> 4
AVAILABLE INFORMATION
The Company 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"). Such reports, proxy
statements and other information filed by the Company, and the Registration
Statement of which this Prospectus forms a part, the exhibits and schedules
thereto and amendments thereof, may be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Room 1024, Judiciary Plaza, Washington, D.C. 20549, and at the regional offices
of the Commission located at 7 World Trade Center, 13th Floor, New York, New
York 10048 and at Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Copies of such material can also be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Judiciary Plaza, Washington, D.C. 20549 at prescribed rates. The Company's
Common Stock is quoted on the Nasdaq National Market, and therefore such
reports, proxy statements and other information can also be inspected at the
offices of the National Association of Securities Dealers, Inc., 1735 K Street,
N.W., 3rd Floor, Washington, D.C. 20006.
Additional information regarding the Company and the shares offered
hereby is contained in the Registration Statement on Form S-3 and the exhibits
thereto (collectively, the "Registration Statement") filed with the Commission
under the Securities Act of 1933, as amended (the "Securities Act"). As
permitted by the rules and regulations of the Commission, this Prospectus does
not contain all of the information set forth in the Registration Statement and
the exhibits thereto, to which reference is hereby made. Statements made in
this Prospectus as to the contents of any contract, agreement or other document
referred to are not necessarily complete. With respect to each such contract,
agreement or other document filed as an exhibit to the Registration Statement,
reference is hereby made to the exhibit for a more complete description of the
matter involved, and each such statement will be deemed qualified in its
entirety by such reference. For further information with respect to the
Company and the shares of Common Stock offered hereby, reference is hereby made
to the Registration Statement, and the exhibits thereto.
SPSS(R), Categories(R), and SYSTAT(R) are registered trademarks of the
Company. SPSS/PC + SPSS Real Stats. Real Easy.(TM) and BMDP(TM) are
unregistered trademarks of the Company, and the trademark QI Analyst(TM) is
subject to a pending application for registration. This Prospectus also
includes trade names and marks of companies other than SPSS Inc.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference the following documents
previously filed with the Commission:
(a) The Company's Annual Report on Form 10-K, filed March 27, 1996 for
the fiscal year ended December 31, 1995;
(b) The Company's Quarterly Report on Form 10-Q, filed May 15, 1996 for
the fiscal quarter ended March 31, 1996;
(c) The Company's Quarterly Report on Form 10-Q filed August 14, 1996
for the fiscal quarter ended June 30, 1996.
(d) The description of the Company's Common Stock, $ .01 par value (the
"Common Stock"), contained in the Company's Registration Statement on Form 8-A
filed with Commission on August 4, 1993, pursuant to Section 12 of the Exchange
Act.
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<PAGE> 5
(e) the Company's Proxy Statement, filed with the Commission on May 16,
1996, for its annual meeting of stockholders held on June 19, 1996, except for
the report of the Compensation Committee contained therein; and
All reports and other documents filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act, subsequent to the date of this
Prospectus and prior to the filing of a post-effective amendment to the
Registration Statement, shall be deemed to be incorporated by reference in the
Registration Statement 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 subsequently filed document which also is or is
deemed to be incorporated by reference herein, modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus.
The Company will provide, without charge, to each person (including any
beneficial owner) to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any and all of the information that has been
incorporated by reference in this Prospectus (not including exhibits to such
information unless such exhibits are specifically incorporated by reference
into such information). Such requests should be directed to: Edward Hamburg,
Senior Vice President, Corporate Operations, Chief Financial Officer and
Secretary, at the Company's principal executive offices at 444 North Michigan
Avenue, Chicago, Illinois 60611, telephone (312) 329-2400.
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<PAGE> 6
UNLESS THE CONTEXT OTHERWISE REQUIRES, REFERENCES IN THIS PROSPECTUS TO "SPSS"
AND THE "COMPANY" SHALL MEAN SPSS INC. A DELAWARE CORPORATION, ITS ILLINOIS
PREDECESSOR AND ITS SUBSIDIARIES, COLLECTIVELY; AND REFERENCES TO THE "COMMON
STOCK" SHALL MEAN SPSS INC.'S COMMON STOCK, PAR VALUE $ .01 PER SHARE.
THE COMPANY
GENERAL
SPSS Inc. ("the Company") was incorporated in Illinois in 1975 under the
name "SPSS, Inc." and was reincorporated in Delaware in May 1993 under the name
"SPSS Inc." The Company develops, markets and supports an integrated line of
statistical software products that enable users to effectively bring
marketplace and enterprise data to bear on decision-making. The primary users
of the Company's software are managers and data analysts in corporate settings,
government agencies and academic institutions. In addition to its widespread
use in survey analysis, SPSS software also performs other types of market
research, as well as quality improvement analyses, scientific and engineering
applications and data reporting. The current generation of SPSS Desktop
products (as defined herein) features a windows-based point-and-click graphical
user interface, sophisticated statistical procedures, data access and
management capabilities, report writing and integrated graphics. The Company's
products provide extensive analytical capabilities not found in spreadsheets,
database management systems or graphics packages.
In its 20 years of operation, SPSS has become a widely recognized name in
statistical software. The Company plans to leverage its current position to
take advantage of the increased demand for software applications that not only
provide ready access to the data that organizations collect and store, but also
enable users to systematically analyze, interpret and present such information
for use in decision- making. Management believes that ease-of-use of the
Company's current generation products, combined with the greater processing
speed and storage capacity of the latest desktop computers, has substantially
expanded the market for SPSS statistical software.
In summer 1993, the Company completed an initial public offering (the
"IPO") of common stock, $ .01 par value (the "Common Stock"). The Common Stock
is listed on the Nasdaq National Market under the symbol "SPSS". In early
1995, the Company and certain selling stockholders (the "Selling Stockholders")
sold 1,865,203 shares of Common Stock in a public offering.
The Company is a Delaware corporation. The Company's principal executive
offices are located at 444 N. Michigan Avenue, Chicago, Illinois 60611, and its
telephone number at its principal executive offices is (312) 329-2400.
SAFE HARBOR
"Safe Harbor" Statement under the Private Securities Litigation Reform
Act of 1995: With the exception of historical information, the matters
discussed in this Prospectus are forward-looking statements that involve risks
and uncertainties including, but not limited to, market conditions, competition
and other risks indicated in the Registration Statement of which this
Prospectus forms a part, and the Company's other filings with the Securities
and Exchange Commission.
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<PAGE> 7
RISK FACTORS
In addition to the other information in this Prospectus, the following
risk factors should be considered carefully by potential purchasers in
evaluating an investment in the Common Stock offered hereby.
Fluctuations in Quarterly Operating Results. The Company's quarterly
operating results can be subject to fluctuation due to several factors,
including the number and timing of product updates and new product
introductions, delays in product development and introduction, purchasing
schedules of its customers, changes in foreign currency exchange rates, product
and market development expenditures, the timing of product shipments, changes
in product mix, timing and cost of acquisitions and general economic
conditions. Because the Company's expense levels are to a large extent based
on its forecasts of future revenues, operating results may be adversely
affected if such revenues fall below expectations. Accordingly, the Company
believes that quarter-to-quarter comparisons of its results of operations may
not be meaningful and should not be relied upon as an indication of future
performance. The Company has historically operated with very little backlog
because its products are generally shipped as orders are received. As a
result, revenues in any quarter are dependent on orders shipped and licenses
renewed in that quarter. The Company has experienced a seasonal pattern in its
operating results with the fourth quarter typically having the highest
operating income. For example, excluding acquisition and other non-recurring
charges, the percentage of the Company's operating income realized in the
fourth quarter was 40% in 1993, 41% in 1994 and 41% in 1995. In addition, the
timing and amount of the Company's revenues are subject to a number of factors
that make estimation of operating results prior to the end of a quarter
uncertain. A significant portion of the Company's operating expenses are
relatively fixed, and planned expenditures are based primarily on revenue
forecasts. More specifically, in the fourth quarter, the variable profit
margins on modest increases in sales volume at the end of the quarter are
significant. Should the Company fail to achieve such fourth quarter revenue
increases, net income for the fourth quarter and the full year could be
materially affected. Generally, if revenues do not meet the Company's
expectations in any given quarter, operating results will be adversely
affected. Although the Company had been profitable in each of the seven
quarters up to and including the quarter ending June 30, 1994, the Company
experienced a net loss of $137,000 in the third quarter of 1994 due to a
one-time write-off of $1,928,000 for acquired and in-process technology and
other acquisition-related charges recorded in connection with the Company's
acquisition of SYSTAT, Inc. ("SYSTAT"). The Company has been profitable in the
seven quarters ending December 31, 1994 through June 30, 1996. However, there
can be no assurance that profitability on a quarterly or annual basis can be
achieved or sustained in the future.
Dependence on a Single Product Category; Declining Sales of Certain
Products. The Company derives substantially all of its product revenues from
licenses of statistical software. Accordingly, any decline in revenues from
licenses of the Company's statistical software, or reduction in demand for
statistical software generally, could have a material adverse effect on the
Company.
In recent years SPSS has experienced a significant shift in the sources
of its revenues. Historically, the Company derived a large portion of its
revenues from licenses of its mainframe and minicomputer ("Large Systems")
products. As a result of the general shift by computer users from Large
Systems to desktop computers, the Company has experienced an ongoing decline in
revenues from Large Systems products in the last several years, although this
decline has generally lessened in recent quarters. Revenues from Large Systems
licenses declined from approximately $15.6 million in 1991 to $10.7 million in
1995, while sales of desktop products increased from $14.7 million in 1991 to
$46.1 million in 1995, although revenues from Large Systems licenses only
declined from $10.8 million to $10.7 million from 1994 to 1995. Management is
unable to predict the continuing rate of decline on Large Systems licenses, if
any. Revenues from the Company's products for desktop computers ("Desktop
products") now account for nearly three-quarters of the Company's revenues and
this percentage may continue to increase.
Rapid Technological Change. The computer software industry is
characterized by rapid technological advances, changes in customer
requirements, frequent product enhancements and new product introductions. The
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<PAGE> 8
Company's future success will depend upon its ability to enhance its existing
products and introduce new products that keep pace with technological
developments, respond to evolving customer requirements and achieve market
acceptance. In particular, the Company believes it must continue to respond
quickly to users' needs for greater functionality, improved usability and
support for new hardware and operating systems. Any failure by the Company to
respond adequately to technological developments and customer requirements, or
any significant delays in product development or introduction, could result in
loss of revenues. In the past, the Company has, on occasion, experienced
delays in the introduction of new products and product enhancements, primarily
due to difficulties with particular operating environments and problems with
software provided by third parties. The extent of these delays has varied
depending upon the size and scope of the project and the nature of the problems
encountered. Such delays have most often resulted from "bugs" encountered in
working with new and/or beta-stage versions of operating systems and other
third party software, and bugs or unexpected difficulties in existing third
party software which complicate integration with the Company's software. From
time to time, the Company has discovered bugs in its products which are
resolved through maintenance releases or through periodic updates depending
upon the seriousness of the defect. There can be no assurance that the Company
will be successful in developing and marketing new products or product
enhancements on a timely basis or that the Company will not experience
significant delays or defects in its products in the future, which could have a
material adverse effect on the Company. In addition, there can be no assurance
that new products or product enhancements developed by the Company will achieve
market acceptance or that developments by others will not render the Company's
products or technologies obsolete or noncompetitive.
International Operations. The Company's revenues from operations outside
of North America accounted for approximately 45%, 51% and 55% of the Company's
net revenues in 1993, 1994 and 1995, respectively. The Company expects that
revenues from international operations will continue to represent a large
percentage of its net revenues and that this percentage may increase,
particularly as the Company further "localizes" the SPSS product line by
translating its products into additional languages. International revenues are
subject to a number of risks, including greater difficulties in accounts
receivable collection, longer payment cycles, exposure to currency
fluctuations, political and economic instability and the burdens of complying
with a wide variety of foreign laws and regulatory requirements. The Company
also believes that it is exposed to greater levels of software piracy in
international markets because of the weaker protection afforded to intellectual
property in some foreign jurisdictions. As the Company expands its
international operations, the risks described above, could increase and, in any
event, could have a material adverse effect on the Company.
Potential Volatility of Stock Price. There has been significant
volatility in the market prices of securities of technology companies and in
some instances, such volatility has been unrelated to the operating performance
of such companies. Market fluctuations may adversely affect the price of the
Common Stock. The Company also believes factors such as announcements of new
products by the Company or its competitors, quarterly variations in financial
results, recommendations and reports of analysts and other factors beyond the
Company's control could cause the market price of the Common Stock to fluctuate
substantially.
Reliance on Relationships with Third Parties. The Company licenses
certain software from third parties. Some of this licensed software is
embedded in the Company's products, and some is offered as add-on products. If
such licenses are discontinued, or become invalid or unenforceable, there can
be no assurance that the Company will be able to develop substitutes for this
software independently or to obtain alternative sources in a timely manner.
Any delays in obtaining or developing substitutes for licensed software could
have a material adverse effect on the Company.
In February 1993, the Company entered into an exclusive, worldwide
agreement (the "Prentice Hall Agreement") with Prentice Hall, Inc. ("Prentice
Hall") under which Prentice Hall publishes and distributes the student version
of the Company's software and all of the Company's publications. As a result,
the Company is dependent on Prentice Hall for the development and support of
the markets for student software and its publications.
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<PAGE> 9
The failure of Prentice Hall to perform its obligations under the Prentice Hall
Agreement adequately could have a material adverse effect on the Company.
In February 1993, the Company entered into a Software Distribution
Agreement (the "IBM Software Distribution Agreement") with International
Business Machines Corporation ("IBM") under which IBM manufactures and packages
all of the Company's products and distributes them to the Company's domestic
customers and international subsidiaries. If IBM fails to adequately perform
its obligations under this agreement, or if the agreement is terminated, the
Company's operating results could be materially adversely effected.
Changes in Public Expenditures and Overall Economic Activity Levels. A
significant portion of the Company's revenues comes from licenses of its
products directly to foreign and domestic government entities. In addition,
significant amounts of the Company's revenues come from licenses to academic
institutions, healthcare organizations and private businesses which contract
with or are funded by government entities. Government appropriations processes
are often slow, unpredictable and subject to factors outside the Company's
control. In addition, proposals are currently being made in certain countries
to reduce government spending. Reductions in government expenditures and
termination or renegotiation of government-funded programs or contracts could
have a material adverse effect on the Company. In addition, declines in
overall levels of economic activity could also have a material adverse impact
on the Company.
Competition. The market for the statistical software is both highly
competitive and fragmented. The Company primarily competes with one general
statistical software provider which is larger and has greater resources than
the Company, as well as with numerous other companies offering statistical
applications software, many of which offer products focused on specific
statistical applications. The Company considers its primary worldwide
competitor to be the larger and better-financed SAS Institute ("SAS"), although
the Company believes that SAS's revenues are derived principally from products
that are used for purposes other than statistics and operate on large systems
platforms. StatSoft Inc., developers of the Statistica product ("Statistica"),
Manugistics Group, Inc., distributors of the Statgraphics Plus product
("Statgraphics"), and Minitab, Inc. ("Minitab") are also competitors, although
their annual revenues from these statistical products are believed to be
considerably less than the revenues of SPSS.
In the future, SPSS may face competition from new entrants into the
statistical software market. The Company could also experience competition
from companies in other sectors of the broader market for data management,
analysis and presentation software, such as providers of spreadsheets, database
management systems, report writers and executive information systems. These
companies have added, or in the future may add, statistical analysis
capabilities to their products. Many of these companies have significant name
recognition, as well as substantially greater capital resources, marketing
experience and research and development capabilities than the Company. There
can be no assurance that the Company will have sufficient resources to make the
necessary investment in research and development and sales and marketing, or
that the Company will otherwise be able to make the technological advances
necessary to maintain or enhance its competitive position. The Company's
future success will also depend significantly upon its ability to continue to
sell its Desktop products, to attract new customers looking for more
sophisticated or powerful software and to introduce additional add-on products
to existing customers. There can be no assurance that the Company will be able
to compete successfully in the future.
Dependence on Key Personnel. The Company is dependent on the efforts of
certain executives and key employees, including its President and Chief
Executive Officer, Jack Noonan. The Company's continued success will depend in
part on its ability to attract and retain highly qualified technical,
managerial, sales, marketing and other personnel. Competition for such
personnel is intense. There can be no assurance that the Company will be able
to continue to attract or retain such highly qualified personnel. No life
insurance policies are maintained on the Company's key personnel.
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<PAGE> 10
Intellectual Property; Proprietary Rights. The statistical algorithms
incorporated in the Company's software are not proprietary. The Company
believes that the proprietary technology constituting a portion of the
Company's software determines the speed and quality of displaying the results
of computations, the connectivity of the Company's products with third party
software and the ease of use of its products. The Company's success will
depend, in part, on its ability to protect the proprietary aspects of its
products. The Company attempts to protect its proprietary software with trade
secret laws and internal nondisclosure safeguards, as well as copyright and
trademark laws and contractual restrictions on copying, disclosure and
transferability that are incorporated into its software license agreements.
The Company licenses its software only in the form of executable code, with
contractual restrictions on copying, disclosures and transferability. Except
for licenses of its products to users of Large System products and annual
licenses of its Desktop products, the Company licenses its products to
end-users by use of a "shrink-wrap" license that is not signed by licensees, as
is customary in the industry. It is uncertain whether such license agreements
are legally enforceable. The source code for all of the Company's products is
protected as a trade secret and as unpublished copyrighted work. In addition,
the Company has entered into confidentiality and nondisclosure agreements with
its key employees. Despite these restrictions, it may be possible for
competitors or users to copy aspects of the Company's products or to obtain
information which the Company regards as a trade secret. The Company has no
patents, and judicial enforcement of copyright laws may be uncertain,
particularly outside of North America. Preventing unauthorized use of computer
software is difficult, and software piracy is expected to be a persistent
problem for the packaged software industry. These problems may be particularly
acute in international markets. In addition, the laws of certain countries in
which the Company's products are or may be licensed do not protect the
Company's products and intellectual property rights to the same extent as the
laws of the United States. Despite the precautions taken by the Company, it
may be possible for unauthorized third parties to reverse engineer or copy the
Company's products or obtain and use information that the Company regards as
proprietary. There can be no assurance that the steps taken by the Company to
protect its proprietary rights will be adequate to prevent misappropriation of
its technology.
Although the Company's products have never been the subject of an
infringement claim, there can be no assurance that third parties will not
assert infringement claims against the Company in the future or that any such
assertion will not result in costly litigation or require the Company to obtain
a license to use the intellectual property of third parties. There can be no
assurance that such licenses will be available on reasonable terms, or at all.
There can also be no assurance that the Company's competitors will not
independently develop technologies that are substantially equivalent or
superior to the Company's technologies.
Control by Existing Stockholders; Antitakeover Effects. As of June 30,
1996, the Company's executive officers and directors owned beneficially
approximately 23.9% of the outstanding shares of Common Stock. The Norman H.
Nie Revocable Trust Dated March 15, 1991 (the "Nie Trust") and affiliates of
the Nie Trust, are entitled to nominate a director for inclusion in the
management slate for election to the Board so long as the Nie Trust continues
to own no less than 12.5% of the outstanding shares of Common Stock. As of
June 30, 1996, the Nie Trust and affiliates of the Nie Trust beneficially owned
approximately 18.6% of the outstanding shares of Common Stock. The Company's
Certificate of Incorporation and Bylaws contain a number of provisions,
including provisions requiring an 80% super majority stockholder approval of
certain actions and provisions for a classified Board of Directors, which would
make the acquisition of the Company, by means of an unsolicited tender offer, a
proxy contest or otherwise, more difficult or impossible.
Shares Eligible for Future Sale. The Company is filing the Registration
Statement to permit transactions with respect to most of the shares of Common
Stock which are currently "restricted securities." These shares of Common
Stock are currently deemed "restricted securities," as defined in Rule 144
under the Securities Act, and may not be resold in the absence of registration
under the Securities Act or pursuant to an exemption from such registration,
including exemptions provided by Rule 144 under the Securities Act.
In addition to the shares of Common Stock which are outstanding, as of
June 30, 1996, there were vested options outstanding held by management to
purchase approximately an additional 621,598 shares of Common Stock
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<PAGE> 11
and unvested options to purchase approximately an additional 296,421 shares of
Common Stock, with an average exercise price of $4.34 per share. The Company
has also established a stock purchase plan available to employees of the
Company, which permits employees to acquire shares of Common Stock at the end
of each quarter at 85% of the market price of the Common Stock as of such date.
No prediction can be made as to the effect, if any, that future sales, or
the availability of shares of Common Stock for future sales, will have on the
market price prevailing from time to time. Sales of substantial amounts of
Common Stock by the Company or by shareholders who hold "restricted
securities," or the perception that such sales may occur, could adversely
affect prevailing market prices for the Common Stock.
Accumulated Deficit. The Company had an accumulated deficit of $18,999,000 as
of December 31, 1995.
SELLING STOCKHOLDERS
The following table sets forth the number of shares of Common Stock
beneficially owned by each Selling Stockholder as of June 30, 1996, the number
of shares of Common Stock that may be offered for the Selling Stockholder's
account and the number of shares of Common Stock and based on the number of
shares of Common Stock beneficially owned as of June 30, 1996, the percentage
of the shares of Common Stock to be beneficially owned by such Selling
Stockholder if they elect to sell all of their Shares of Common Stock that are
available for sale.
<TABLE>
<CAPTION>
SHARES OF MAXIMUM NUMBER OF SHARES OF COMMON STOCK
COMMON STOCK SHARES AVAILABLE TO BE BENEFICIALLY OWNED
Name and Address of BENEFICIALLY OWNED TO BE SOLD ASSUMING SALE OF ALL SHARES
SELLING STOCKHOLDER AS OF JUNE 30, 1996 PURSUANT HERETO AVAILABLE FOR SALE HEREUNDER(1)
------------------- ------------------- --------------- -------------------------------
NUMBER PERCENT
------ -------
<S> <C> <C> <C> <C>
Norman H. Nie, individually, 1,361,577(2) 1,291,633 69,944(2) *
as Trustee of the Norman H.
Nie Trust and as a Director
and President of the Norman
and Carol Nie Foundation (2)
Bernard Goldstein 30,723 29,346 0 *
Louise E. Rehling 74,990(3) 9,400 65,590 *
Vi Ann Beadle 4,234 4,234 0 -
Susan Phelan 52,149(4) 1,833 50,316(4) *
Terrence Schohn 1,588(5) 1,200 388(5) *
Merritt M. Lutz 18,833 13,333 0 *
Edward Hamburg 82,257(6) 10,000 72,257(6) *
Leland Wilkinson 194,144(7) 135,000 59,144(7) *
Mark Bjerknes 21,572(8) 15,000 6,572(8) *
</TABLE>
*The percentage of shares beneficially owned does not exceed 1% of the class.
- 9 -
<PAGE> 12
(1) Based upon the number of Shares of Common Stock outstanding on June 30,
1996. Assumes all stock that may be offered pursuant to this Prospectus
is sold, and no other shares beneficially owned by the Selling
Stockholders are sold.
(2) Includes 69,944 shares which are subject to currently exercisable
options; 110,433 shares held of record by the Norman and Carol Nie
Foundation (the "Nie Foundation"); and 1,181,200 shares held by the Nie
Trust. Professor Nie shares voting and investment power over the 110,433
shares held by the Nie Foundation with Carol Nie.
(3) Includes 65,590 shares subject to currently exercisable options.
(4) Includes 50,316 shares subject to currently exercisable options.
(5) Includes 388 shares subject to currently exercisable options.
(6) Includes 72,257 shares subject to currently exercisable options.
(7) Includes 59,144 shares subject to currently exercisable options.
(8) Includes 6,572 shares subject to currently exercisable options.
The Company has voluntarily agreed to register the shares of Common Stock
of the Selling Stockholders offered hereby under the Securities Act. In this
connection, the selling stockholders are required to pay the underwriting
discounts and commissions and transfer taxes, if any, associated with the sale
of their shares of Common Stock, and the Company will pay substantially all of
the expenses directly associated with the registration of such shares of Common
Stock hereunder.
The Company is filing a registration statement to permit transactions
with respect to all of the shares of Common Stock which are currently
"restricted securities." However, there can be no assurance as to what period
of time such registration statement will remain effective, since the Company is
not contractually obligated to file a registration statement with respect to
transactions involving shares of Common Stock owned by the Selling Stockholders
and could terminate its use at any time.
USE OF PROCEEDS
The Company will not receive any proceeds from the registration or sale
of the shares of Common Stock offered hereby.
DIVIDEND POLICY AND RESTRICTIONS
The Company has never declared any cash dividends or distributions on its
capital stock and does not anticipate paying cash dividends in the foreseeable
future. The Company currently intends to retain its future earnings to fund
ongoing operations and future capital requirements of its business.
PLAN OF DISTRIBUTION
The Common Stock may be offered by the Selling Stockholders from time to
time in transactions on the Nasdaq National Market, in negotiated transactions,
or a combination of such methods of sale, at fixed prices that may be changed,
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Selling Stockholders may
effect such transactions by the sale of the Common Stock to or through
broker-dealers, and such broker-dealers may receive compensation in the form of
discounts, concessions or commissions from the selling Stockholders and/or the
purchasers of the Common Stock for whom such broker-dealers may act as agent or
to whom they may sell as principal, or both (which compensation to a particular
broker-dealer might be in excess of customary commissions). The Selling
Stockholders and any broker-
- 10 -
<PAGE> 13
dealer who acts in connection with the sale of Common Stock hereunder may be
deemed to be "underwriters" as that term is defined in the Securities Act, and
any commission received by them and profit on any resale of the Common Stock as
principal might be deemed to be underwriting discounts and commissions under
the Securities Act.
No prediction can be made as to the effect, if any, that future sales, or
the availability of shares of Common Stock for future sales, will have on the
market price prevailing from time to time. See "RISK FACTORS - Shares Eligible
for Future Sale" elsewhere in this Prospectus.
The Company is filing a registration statement to permit transactions
with respect to all of the shares of Common Stock which are currently
"restricted securities". However, there can be no assurance as to what period
of time such registration statement will remain effective, since the Company is
not contractually obligated to file a registration statement with respect to
transactions involving shares of Common Stock owned by the Selling Stockholders
and could terminate its use at any time.
LEGAL MATTERS
The validity of the shares of Common Stock was passed upon for the
Company by Ross & Hardies, Chicago, Illinois.
EXPERTS
The Consolidated Financial Statements and Schedule of the Company as of
December 31, 1995 and 1994, and for each of the years in the three-year period
ended December 31, 1995, incorporated by reference in this Prospectus and
elsewhere in the Registration Statement have been audited by KPMG Peat Marwick
LLP, independent certified public accountants, as indicated in their report
with respect thereto and upon the authority of said firm as experts in
accounting and auditing.
- 11 -
<PAGE> 14
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, IF GIVEN
OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR
ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION
BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR TABLE OF CONTENTS
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
Available Information . . . . . . . . . . . 2
Incorporation of Certain
Documents by Reference . . . . . . . . . . 2
The Company . . . . . . . . . . . . . . . . 4
Risk Factors . . . . . . . . . . . . . . . 5
Selling Stockholders . . . . . . . . . . . 9
Use of Proceeds . . . . . . . . . . . . . . 10
Dividend Policy and Restrictions . . . . . 10
Plan of Distribution . . . . . . . . . . . 10
Legal Matters . . . . . . . . . . . . . . . 11
Experts . . . . . . . . . . . . . . . . . . 11
-----------------
</TABLE>
1,504,979 Shares
SPSS INC.
COMMON STOCK
($.01 PAR VALUE)
Prospectus
Dated August 16, 1996
<PAGE> 15
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth various fees and estimated expenses in
connection with the sale and distribution of the securities being registered,
all of which are being borne by the registrant.
<TABLE>
<S> <C>
SEC registration fee . . . . . . . . . . . . . . . . . . . . . $ 12,125
Printing expenses . . . . . . . . . . . . . . . . . . . . . . . $ 1,000
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . $ 25,000
Accounting fees and expenses . . . . . . . . . . . . . . . . . $ 20,000
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,500
Total . . . . . . . . . . . . . . . . . . . . . . . . . $ 60,625
</TABLE>
Item 15. Indemnification of Directors and Officers
Delaware General Corporation Law. The Company has statutory authority to
indemnify the officers and directors. The applicable provisions of the General
Corporation Law of the State of Delaware (the "GCL") state that, to the extent
such person is successful on the merits or otherwise, a corporation may
indemnify any person who was or is a party or who is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the corporation), by reason of the fact that he is or was
a director, officer, employee or agent of the corporation or is or was serving
at the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
("such Person"), against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement, actually and reasonably incurred by such
Person, if he acted in good faith and in a manner 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, had no reasonable cause to believe his
conduct was unlawful. In any threatened pending or completed action by or in
the right of the corporation, a corporation also may indemnify any such Person
for costs actually and reasonably incurred by him in connection with that
action's defense or settlement, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation; however, no indemnification shall be made with respect to any
claim, issue or matter as to which such Person shall have been adjudged to be
liable to the corporation, unless and only to the extent that a court shall
determine that such indemnity is proper.
Under the applicable provisions of the GCL, any indemnification shall be
made by the corporation only as authorized in the specific case upon a
determination that the indemnification of the director, officer, employee or
agent is proper in the circumstances because he has met the applicable standard
of conduct. Such determination shall be made:
(1) By the Board of Directors by a majority vote of a quorum consisting
of directors who are not parties to such action, suit or proceeding; or
(2) If such a quorum is not obtainable or, even if obtainable, a quorum
of disinterested directors so directs, by independent legal counsel in a
written opinion; or
(3) By the affirmative vote of a majority of the shares entitled to
vote thereon.
The Company's Certificate of Incorporation provides for indemnification
to the full extent permitted by the laws of the State of Delaware against and
with respect to threatened, pending or completed actions, suits or proceedings
arising from or alleged to arise from, a party's actions or omissions as a
director, officer, employee or agent of the Company or of any subsidiary of the
Company or of any other corporation, partnership, joint venture, trust or other
enterprise which he has served in such capacity at the request of the Company
if such acts or omissions occurred or were or are alleged to have occurred,
while said party was a director or officer of the Company.
II-1
<PAGE> 16
Item 16. Exhibits
<TABLE>
<CAPTION>
Incorporation by
Exhibit Reference (if
Number Description of Document applicable)
------ ----------------------- ------------------
<S> <C> <C>
4.1 Credit Agreement *4.1
5.1 Opinion of Ross & Hardies regarding legality of shares of Common Stock
15.1 Letter re: Unaudited Interim Financial Information
23.1 Accountants' Consent
23.2 Consent of Ross & Hardies (contained in opinion described in 5.1)
24.1 Power of Attorney ***
</TABLE>
- ---------------
* Previously filed with Form 10-Q Quarterly Report of SPSS Inc. for the
Quarterly period ended March 31, 1996 (Registration No. 0-22194)
*** Included in signature pages.
(b) The Company did not file any reports on Form 8-K during fiscal year
1995 or for the first two quarters of fiscal year 1996.
Item 17. Undertakings
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, 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.
(2) That, for the purpose of determining any liability under the Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities, at that time shall be deemed to be the initial bona fide offering
thereof; and
(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.
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 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to 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.
The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the Prospectus, to deliver, or
cause to be delivered to each person to whom the Prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the Prospectus to provide such interim financial information.
II-2
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant 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 August , 1996.
SPSS INC.
By: /s/ Jack Noonan
-------------------------------------
Jack Noonan
President and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
Jack Noonan and Edward Hamburg, and each of them, the true and lawful
attorneys-in-fact and agents of the undersigned, with full power of
substitution and resubstitution, for and in the name, place and stead of the
undersigned, in any and all capacities, to sign any and all amendments
(including post-effective amendments) to this Registration Statement, and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, and hereby grants to
such attorneys-in-fact and agents, and each of them, full power and authority
to do and perform each and every act and thing requisite and necessary to be
done in furtherance of the foregoing, as fully to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and confirming
all that said attorneys-in-fact and agents, or any of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on August , 1996.
<TABLE>
<CAPTION>
Signature Title(s)
--------- --------
<S> <C>
/s/Norman H. Nie Chairman of the Board of Directors
-------------------------------------------------------------
Norman H. Nie
President, Chief Executive Officer
/s/Jack Noonan and Director
-------------------------------------------------------------
Jack Noonan
Senior Vice President, Corporate
/s/Edward Hamburg Operations, Chief Financial Officer
------------------------------------------------------------- and Secretary
Edward Hamburg
/s/Robert Brinkmann Controller and Assistant Secretary
------------------------------------------------------------- (Chief Accounting Officer)
Robert Brinkmann
/s/Guy de Chazal Director
-------------------------------------------------------------
Guy de Chazal
/s/Bernard Goldstein Director
-------------------------------------------------------------
Bernard Goldstein
/s/Frederic W. Harman Director
-------------------------------------------------------------
Frederic W. Harman
</TABLE>
II-3
<PAGE> 18
<TABLE>
<S> <C>
Director
/s/Merritt Lutz
- -------------------------------------------------
Merritt Lutz
</TABLE>
SPSS INC.
EXHIBIT INDEX
<TABLE>
<CAPTION>
Location of Document in
Exhibit No. Description of Document Sequential Numbering System
- ----------- ----------------------- ---------------------------
<S> <C> <C>
5.1 Opinion of Ross & Hardies regarding legality 19
of shares of Common Stock
15.1 Letter re: Unaudited Interim Financial Information 21
23.1 Accountants' Consent 23
</TABLE>
II-4
<PAGE> 1
EXHIBIT 5.1
August 16, 1996
SPSS INC.
444 N. Michigan Avenue
Chicago, Illinois 60611
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
You have requested our opinion with respect to the offering and sale of
Common Stock pursuant to a Registration Statement on Form S-3 (the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Act"), of up to an aggregate of 1,504,979 shares of Common Stock, $.01 par
value per share (the "Common Stock") of SPSS Inc. (the "Corporation").
In so acting, we have examined originals or copies, certified or
otherwise identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed relevant and necessary
to form a basis for the opinions hereinafter expressed. In conducting such
examination, we have assumed (i) that all signatures are genuine, (ii) that all
documents and instruments submitted to us as copies conform with the originals,
and (iii) the due execution and delivery of all documents where due execution
and delivery are a prerequisite to the effectiveness thereof. As to any facts
material to this opinion, we have relied upon statements and representations of
officers and other representatives of the Corporation and certificates of
public officials and have not independently verified such facts.
Based upon the foregoing, it is our opinion that the Common Stock is
legally issued, fully paid and non-assessable.
We express no opinion as to the laws of any jurisdiction other than the
State of Illinois, the United States of America, and, solely with respect to
matters of corporate organization and authority, the General Corporation Law of
the State of Delaware. We are not admitted to the practice of law in the State
of Delaware. Insofar as the foregoing opinion relates to matters that would be
controlled by the substantive laws of any jurisdiction other than the United
States of America, the General Corporation Law of the State of Delaware (with
respect to matters of corporate organization and authority) or the State of
Illinois, we have assumed that the substantive laws of such jurisdiction
conform in all respects to the internal laws of the State of Illinois.
We hereby consent to the use of this opinion as Exhibit 5.1 to the
Registration Statement relating to the registration of 1,504,979 shares of
Common Stock and to the use of our name as your counsel in connection with the
Registration Statement and in the Prospectus forming a part thereof.
Very truly yours,
ROSS & HARDIES
By: /s/ T. Stephen Dyer
------------------------
A Partner
<PAGE> 1
EXHIBIT 15.1
LETTER RE: UNAUDITED INTERIM FINANCIAL INFORMATION
The Board of Directors
SPSS Inc.:
With respect to the subject registration statement on Form S-3, we acknowledge
our awareness of the use therein of our reports dated May 10, 1996 and August
2, 1996, related to our reviews of interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such reports are not
considered part of a registration statement prepared or certified by an
accountant or a report prepared or certified by an accountant within the
meaning of sections 7 and 11 of the Act.
/s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK LLP
Chicago, Illinois
August 12, 1996
<PAGE> 1
EXHIBIT 23.1
ACCOUNTANTS' CONSENT
The Board of Directors
SPSS Inc.:
We consent to incorporation by reference in the registration statement on Form
S-3 of SPSS Inc. of our report dated February 21, 1996, except as to Note 14,
which is as of March 15, 1996, relating to the consolidated balance sheets of
SPSS Inc. and subsidiaries as of December 31, 1995, and 1994, and the related
consolidated statements of income, stockholders' (deficit) equity, and cash
flows for each of the years in the three-year period ended December 31, 1995,
and the related schedule, which report appears in the December 31, 1995, annual
report on Form 10-K of SPSS Inc.
/s/ KPMG PEAT MARWICK LLP
KPMG PEAT MARWICK LLP
Chicago, Illinois
August 12, 1996
