<PAGE> 1
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 10-K/A-2
(MARK ONE)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM __________ TO __________.
COMMISSION FILE NUMBER 0-26146
HNC SOFTWARE INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
DELAWARE 33-0248788
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
</TABLE>
5930 CORNERSTONE COURT WEST, SAN DIEGO, CA 92121
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (619) 546-8877
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
COMMON STOCK, $0.001 PAR VALUE
(TITLE OF CLASS)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
The aggregate market value of the voting stock held by non-affiliates of
the Registrant, based on the closing price as reported on the Nasdaq Stock
Market at January 30, 1998, was approximately $809 million. The number of shares
of the Registrant's Common Stock outstanding at January 30, 1998 was 24,570,578
shares.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Proxy Statement for Registrant's 1998 Annual Meeting of
Stockholders to be filed with the Commission on or before April 30, 1998 are
incorporated by reference in Part III of this Annual Report on Form 10-K. With
the exception of those portions that are specifically incorporated by reference
in this Annual Report on Form 10-K, such Proxy Statement shall not be deemed
filed as part of this Report or incorporated by reference herein.
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<PAGE> 2
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report:
3. Exhibits
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
-------- -----------
<S> <C>
2.01 Agreement and Plan of Reorganization dated as of July 19,
1996 by and among the Registrant, HNC Merger Corp. and Risk
Data Corporation, as amended. (Incorporated by reference to
Exhibit Number 2.01 to Registrant's Current Report on Form
8-K filed on September 12, 1996, as amended (the "Risk Data
8-K").)
2.02 Agreement of Merger dated August 30, 1996 by and between HNC
Merger Corp. and Risk Data Corporation. (Incorporated by
reference to Exhibit Number 2.02 to the Risk Data 8-K.)
2.03 Exchange Agreement dated as of October 25, 1996 by and among
the Registrant, Retek Distribution Corporation and the
shareholders of Retek Distribution Corporation.
(Incorporated by reference to Exhibit Number 2.01 to
Registrant's Current Report on Form 8-K filed on December
12, 1996 (the "Retek 8-K").)
2.04 Form of Option Exchange Agreement between the Registrant and
each person who held outstanding options to purchase shares
of Retek Distribution Corporation on November 29, 1996.
(Incorporated by reference to Exhibit Number 2.02 to the
Retek 8-K.)
2.05 Agreement and Plan of Reorganization dated as of July 14,
1997 by and among the Registrant, FW1 Acquisition Corp.,
CompReview, Inc., Robert L. Kaaren and Mishel E. Munnayer,
a.k.a. Michael Munayyer, Trustee of the Michael Munayyer
Trust dated August 11, 1995. (Pursuant to Item 601(b)(2) of
Regulation S-K, certain schedules have been omitted but will
be furnished supplementally to the Commission upon request.)
(Incorporated by reference to Exhibit Number 2.01 to
Registrant's Current Report on Form 8-K filed on December
15, 1997 (the "CompReview 8-K").)
2.06 Agreement of Merger dated as of November 28, 1997 by and
between FW1 Acquisition Corp. and CompReview, Inc.
(Incorporated by reference to Exhibit Number 2.02 to the
CompReview 8-K.)
3(i).01 Registrant's Restated Certificate of Incorporation filed
with the Secretary of State of Delaware on June 13, 1996.
(Incorporated by reference to Exhibit Number 3(i).04 to
Registrant's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996 (the "Second Quarter 1996 10-Q").)
Registrant's Bylaws, as amended. (Incorporated by reference
3(ii).02 to Exhibit Number 3(ii).05 to the Second Quarter 1996 10-Q.)
4.01 Form of Specimen Certificate for Registrant's Common Stock.
(Incorporated by reference to Exhibit Number 4.01 to
Registrant's Form S-1 Registration Statement, as amended
(File No. 33-91932) (the "IPO S-1").)
4.02 Third Amended Registration Rights Agreement dated March 10,
1993, as amended. (Incorporated by reference to Exhibit
Number 4.02 to the IPO S-1.)
4.03 Second Waiver and Amendment to Third Amended Registration
Rights Agreement. (Incorporated by reference to Exhibit
Number 4.03 to Registrant's Form S-1 Registration Statement,
as amended (File No. 33-99980) (the "Second S-1").)
4.04 Registration Rights Agreement dated as of August 30, 1996 by
and among the Registrant and the former shareholders of Risk
Data Corporation. (Incorporated by reference to Exhibit
Number 4.01 to the Risk Data 8-K.)
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
-------- -----------
<S> <C>
4.05 Registration Rights Agreement dated as of October 25, 1996
by and among the Registrant and the former shareholders of
Retek Distribution Corporation. (Incorporated by reference
to Exhibit Number 4.01 to the Retek 8-K.)
4.06 Amendment No. 1 to the Registration Rights Agreement dated
as of February 24, 1997 by and between the Registrant and
the former shareholders of Retek Distribution Corporation.
(Incorporated by reference to Exhibit Number 4.06 to
Registrant's Annual Report on Form 10-K, as amended, for the
year ended December 31, 1996 (the "1996 10-K").)
4.07 Registration Rights Agreement dated as of November 28, 1997
by and among the Registrant and the former shareholders of
CompReview, Inc. (Incorporated by reference to Exhibit
Number 4.01 to the CompReview 8-K.)
10.01 Registrant's 1987 Stock Option Plan and related documents.
(Incorporated by reference to Exhibit Number 10.01 to the
IPO S-1.)(1)
10.02 Registrant's 1995 Equity Incentive Plan and related
documents, as amended.(1)
10.03 Registrant's 1995 Directors Stock Option Plan and related
documents. (Incorporated by reference to Exhibit Number
10.03 to the IPO S-1.)(1)
10.04 Registrant's 1995 Employee Stock Purchase Plan and related
documents. (Incorporated by reference to Exhibit Number
10.04 to the IPO S-1.)(1)
10.05 Registrant's 1998 Stock Option Plan.(1)
10.06 Form of Indemnity Agreement entered into by Registrant with
each of its directors and executive officers. (Incorporated
by reference to Exhibit Number 10.08 to the IPO S-1.)(1)
10.07 Office Building Lease dated as of December 1, 1993, as
amended effective February 1, 1994 and June 1, 1994, between
Registrant and PacCor Partners. (Incorporated by reference
to Exhibit Number 10.09 to the IPO S-1.)
10.08 Marketing Agreement dated as of June 24, 1993 between
Registrant and First Data Resources, Inc. (Incorporated by
reference to Exhibit Number 10.11 to the IPO S-1.)(2)
10.09 License Agreement dated as of June 24, 1993, as amended
October 18, 1993, September 16, 1994 and by letter
amendment, with Addendum dated January 21, 1994, as amended
February 15, 1995, between Registrant and First Data
Resources, Inc. (Incorporated by reference to Exhibit Number
10.12 to the IPO S-1.)(2)
10.10 Loan and Security Agreement dated as of July 11, 1997,
between Registrant and Wells Fargo Bank, National
Association. (Incorporated by reference to Exhibit Number
10.01 to Registrant's Quarterly Report on Form 10-Q, as
amended, for the quarter ended June 30, 1997 (the "Second
Quarter 1997 10-Q").)
10.11 Office Building Lease dated as of May 30, 1997, between
Retek Information Systems, Inc. and Midwest Real Estate
Holdings, Inc. (Incorporated by reference to Exhibit Number
10.02 to the Second Quarter 1997 10-Q.)
10.12 Office Building Lease dated as of June 17, 1996, between
Registrant and Williams Properties I, LLC & Williams
Properties II, LLC. (Incorporated by reference to Exhibit
Number 10.12 to the 1996 10-K.)
10.13 Employment Agreement dated as of September 10, 1996, by and
between Aptex Software Inc. and Michael A. Thiemann.
(Incorporated by reference to Exhibit Number 10.13 to the
1996 10-K.)(1)
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
-------- -----------
<S> <C>
10.14 Investors' Rights Agreement dated as of September 10, 1996,
by and among Aptex Software Inc., HNC Software Inc. and
Michael A. Thiemann. (Incorporated by reference to Exhibit
Number 10.14 to the 1996 10-K.)(1)
10.15 Restricted Stock Purchase Agreement dated as of September
10, 1996, by and between Aptex Software Inc. and Michael
Thiemann. (Incorporated by reference to Exhibit Number 10.15
to the 1996 10-K.)(1)
10.16 Aptex Software Inc.'s 1996 Equity Incentive Plan and related
documents. (Incorporated by reference to Exhibit Number
10.16 to the 1996 10-K.)(1)
10.17 Office Building Lease dated June 17, 1993, between
Linsco/Private Ledger Corp. and PacCor Partners and
Assignment of such lease to the Registrant.
21.01 List of Registrant's subsidiaries.
23.01 Consent of Price Waterhouse LLP, Independent Accountants.
27.01 Financial Data Schedule (December 31, 1997)
*27.02 Restated Financial Data Schedule (September 30, 1997)
*27.03 Restated Financial Data Schedule (June 30, 1997)
*27.04 Restated Financial Data Schedule (March 31, 1997)
*27.05 Restated Financial Data Schedule (December 31, 1996)
*27.06 Restated Financial Data Schedule (September 30, 1996)
*27.07 Restated Financial Data Schedule (June 30, 1996)
*27.08 Restated Financial Data Schedule (March 31, 1996)
*27.09 Restated Financial Data Schedule (December 31, 1995)
</TABLE>
- ---------------
* Filed herewith.
(1) Management contract or compensatory plan or arrangement.
(2) Confidential treatment has been granted for certain portions of this
document. Such portions have been omitted from the filing and have been
filed separately with the Securities and Exchange Commission.
<PAGE> 5
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this amendment to report to
be signed on its behalf by the undersigned, thereunto duly authorized.
Date: April 10, 1998 HNC SOFTWARE INC.
By: /s/ RAYMOND V. THOMAS
------------------------------------
Raymond V. Thomas
Vice President, Finance &
Administration
and Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
amendment to report has been signed below by the following persons on behalf of
the Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<C> <S> <C>
/s/ ROBERT L. NORTH President and Chief April 10, 1998
- ----------------------------------------------------- Executive Officer (Principal
Robert L. North Executive Officer)
/s/ RAYMOND V. THOMAS Vice President, Finance & April 10, 1998
- ----------------------------------------------------- Administration and Chief
Raymond V. Thomas Financial Officer (Principal
Financial Officer and
Principal Accounting
Officer)
/s/ EDWARD K. CHANDLER Director April 10, 1998
- -----------------------------------------------------
Edward K. Chandler
/s/ OLIVER D. CURME Director April 10, 1998
- -----------------------------------------------------
Oliver D. Curme
/s/ THOMAS F. FARB Director April 10, 1998
- -----------------------------------------------------
Thomas F. Farb
Director April 10, 1998
- -----------------------------------------------------
Charles H. Gaylord, Jr.
</TABLE>
61
<PAGE> 6
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- -------- -------------
<C> <S>
2.01 Agreement and Plan of Reorganization dated as of July 19,
1996 by and among the Registrant, HNC Merger Corp. and Risk
Data Corporation, as amended. (Incorporated by reference to
Exhibit Number 2.01 to Registrant's Current Report on Form
8-K filed on September 12, 1996, as amended (the "Risk Data
8-K").).....................................................
2.02 Agreement of Merger dated August 30, 1996 by and between HNC
Merger Corp. and Risk Data Corporation. (Incorporated by
reference to Exhibit Number 2.02 to the Risk Data 8-K.).....
2.03 Exchange Agreement dated as of October 25, 1996 by and among
the Registrant, Retek Distribution Corporation and the
shareholders of Retek Distribution Corporation.
(Incorporated by reference to Exhibit Number 2.01 to
Registrant's Current Report on Form 8-K filed on December
12, 1996 (the "Retek 8-K").)................................
2.04 Form of Option Exchange Agreement between the Registrant and
each person who held outstanding options to purchase shares
of Retek Distribution Corporation on November 29, 1996.
(Incorporated by reference to Exhibit Number 2.02 to the
Retek 8-K.).................................................
2.05 Agreement and Plan of Reorganization dated as of July 14,
1997 by and among the Registrant, FW1 Acquisition Corp.,
CompReview, Inc., Robert L. Kaaren and Mishel E. Munnayer,
a.k.a. Michael Munayyer, Trustee of the Michael Munayyer
Trust dated August 11, 1995. (Pursuant to Item 601(b)(2) of
Regulation S-K, certain schedules have been omitted but will
be furnished supplementally to the Commission upon request.)
(Incorporated by reference to Exhibit Number 2.01 to
Registrant's Current Report on Form 8-K filed on December
15, 1997 (the "CompReview 8-K").)...........................
2.06 Agreement of Merger dated as of November 28, 1997 by and
between FW1 Acquisition Corp. and CompReview, Inc.
(Incorporated by reference to Exhibit Number 2.02 to the
CompReview 8-K.)............................................
3(i).01 Registrant's Restated Certificate of Incorporation filed
with the Secretary of State of Delaware on June 13, 1996.
(Incorporated by reference to Exhibit Number 3(i).04 to
Registrant's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996 (the "Second Quarter 1996 10-Q").)......
3(ii).02 Registrant's Bylaws, as amended. (Incorporated by reference
to Exhibit Number 3(ii).05 to the Second Quarter 1996
10-Q.)......................................................
4.01 Form of Specimen Certificate for Registrant's Common Stock.
(Incorporated by reference to Exhibit Number 4.01 to
Registrant's Form S-1 Registration Statement, as amended
(File No. 33-91932) (the "IPO S-1").).......................
4.02 Third Amended Registration Rights Agreement dated March 10,
1993, as amended. (Incorporated by reference to Exhibit
Number 4.02 to the IPO S-1.)................................
4.03 Second Waiver and Amendment to Third Amended Registration
Rights Agreement. (Incorporated by reference to Exhibit
Number 4.03 to Registrant's Form S-1 Registration Statement,
as amended (File No. 33-99980) (the "Second S-1").).........
4.04 Registration Rights Agreement dated as of August 30, 1996 by
and among the Registrant and the former shareholders of Risk
Data Corporation. (Incorporated by reference to Exhibit
Number 4.01 to the Risk Data 8-K.)..........................
4.05 Registration Rights Agreement dated as of October 25, 1996
by and among the Registrant and the former shareholders of
Retek Distribution Corporation. (Incorporated by reference
to Exhibit Number 4.01 to the Retek 8-K.)...................
4.06 Amendment No. 1 to the Registration Rights Agreement dated
as of February 24, 1997 by and between the Registrant and
the former shareholders of Retek Distribution Corporation.
(Incorporated by reference to Exhibit Number 4.06 to
Registrant's Annual Report on Form 10-K, as amended, for the
year ended December 31, 1996 (the "1996 10-K").)............
4.07 Registration Rights Agreement dated as of November 28, 1997
by and among the Registrant and the former shareholders of
CompReview, Inc. (Incorporated by reference to Exhibit
Number 4.01 to the CompReview 8-K.).........................
10.01 Registrant's 1987 Stock Option Plan and related documents.
(Incorporated by reference to Exhibit Number 10.01 to the
IPO S-1.)(1)................................................
10.02 Registrant's 1995 Equity Incentive Plan and related
documents, as amended.(1)...................................
10.03 Registrant's 1995 Directors Stock Option Plan and related
documents. (Incorporated by reference to Exhibit Number
10.03 to the IPO S-1.)(1)...................................
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT TITLE
- -------- -------------
<C> <S>
10.04 Registrant's 1995 Employee Stock Purchase Plan and related
documents. (Incorporated by reference to Exhibit Number
10.04 to the IPO S-1.)(1)...................................
10.05 Registrant's 1998 Stock Option Plan.(1).....................
10.06 Form of Indemnity Agreement entered into by Registrant with
each of its directors and executive officers. (Incorporated
by reference to Exhibit Number 10.08 to the IPO S-1.)(1)....
10.07 Office Building Lease dated as of December 1, 1993, as
amended effective February 1, 1994 and June 1, 1994, between
Registrant and PacCor Partners. (Incorporated by reference
to Exhibit Number 10.09 to the IPO S-1.)....................
10.08 Marketing Agreement dated as of June 24, 1993 between
Registrant and First Data Resources, Inc. (Incorporated by
reference to Exhibit Number 10.11 to the IPO S-1.)(2).......
10.09 License Agreement dated as of June 24, 1993, as amended
October 18, 1993, September 16, 1994 and by letter
amendment, with Addendum dated January 21, 1994, as amended
February 15, 1995, between Registrant and First Data
Resources, Inc. (Incorporated by reference to Exhibit Number
10.12 to the IPO S-1.)(2)...................................
10.10 Loan and Security Agreement dated as of July 11, 1997,
between Registrant and Wells Fargo Bank, National
Association. (Incorporated by reference to Exhibit Number
10.01 to Registrant's Quarterly Report on Form 10-Q, as
amended, for the quarter ended June 30, 1997 (the "Second
Quarter 1997 10-Q"))........................................
10.11 Office Building Lease dated as of May 30, 1997, between
Retek Information Systems, Inc. and Midwest Real Estate
Holdings, Inc. (Incorporated by reference to Exhibit Number
10.02 to the Second Quarter 1997 10-Q.).....................
10.12 Office Building Lease dated as of June 17, 1996, between
Registrant and Williams Properties I, LLC & Williams
Properties II, LLC. (Incorporated by reference to Exhibit
Number 10.12 to the 1996 10-K.).............................
10.13 Employment Agreement dated as of September 10, 1996, by and
between Aptex Software Inc. and Michael A. Thiemann.
(Incorporated by reference to Exhibit Number 10.13 to the
1996 10-K.)(1)..............................................
10.14 Investors' Rights Agreement dated as of September 10, 1996,
by and among Aptex Software Inc., HNC Software Inc. and
Michael A. Thiemann. (Incorporated by reference to Exhibit
Number 10.14 to the 1996 10-K.)(1)..........................
10.15 Restricted Stock Purchase Agreement dated as of September
10, 1996, by and between Aptex Software Inc. and Michael
Thiemann. (Incorporated by reference to Exhibit Number 10.15
to the 1996 10-K.)(1).......................................
10.16 Aptex Software Inc.'s 1996 Equity Incentive Plan and related
documents. (Incorporated by reference to Exhibit Number
10.16 to the 1996 10-K.)(1).................................
10.17 Office Building Lease dated June 17, 1993, between
Linsco/Private Ledger Corp. and PacCor Partners and
Assignment of such lease to the Registrant..................
21.01 List of Registrant's subsidiaries...........................
23.01 Consent of Price Waterhouse LLP, Independent Accountants....
27.01 Financial Data Schedule (December 31, 1997).................
*27.02 Restated Financial Data Schedule (September 30, 1997).......
*27.03 Restated Financial Data Schedule (June 30, 1997)............
*27.04 Restated Financial Data Schedule (March 31, 1997)...........
*27.05 Restated Financial Data Schedule (December 31, 1996)........
*27.06 Restated Financial Data Schedule (September 30, 1996).......
*27.07 Restated Financial Data Schedule (June 30, 1996)............
*27.08 Restated Financial Data Schedule (March 31, 1996)...........
*27.09 Restated Financial Data Schedule (December 31, 1995)........
</TABLE>
- ---------------
* Filed herewith.
(1) Management contract or compensatory plan or arrangement.
(2) Confidential treatment has been granted for certain portions of this
document. Such portions have been omitted from the filing and have been
filed separately with the Securities and Exchange Commission.
<TABLE> <S> <C>
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<PERIOD-START> JUL-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 4,901
<SECURITIES> 36,587
<RECEIVABLES> 31,924
<ALLOWANCES> (1,770)
<INVENTORY> 264
<CURRENT-ASSETS> 81,647
<PP&E> 18,552
<DEPRECIATION> (7,973)
<TOTAL-ASSETS> 114,732
<CURRENT-LIABILITIES> 16,190
<BONDS> 0
0
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<COMMON> 25
<OTHER-SE> 98,116
<TOTAL-LIABILITY-AND-EQUITY> 114,732
<SALES> 29,989
<TOTAL-REVENUES> 29,989
<CGS> 8,770
<TOTAL-COSTS> 8,770
<OTHER-EXPENSES> 14,848
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16
<INCOME-PRETAX> 6,909
<INCOME-TAX> 1,781
<INCOME-CONTINUING> 5,128
<DISCONTINUED> 0
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<NET-INCOME> 5,128
<EPS-PRIMARY> 0.21
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<CASH> 5,699
<SECURITIES> 36,959
<RECEIVABLES> 25,865
<ALLOWANCES> (1,076)
<INVENTORY> 439
<CURRENT-ASSETS> 76,809
<PP&E> 14,485
<DEPRECIATION> (7,002)
<TOTAL-ASSETS> 108,848
<CURRENT-LIABILITIES> 14,882
<BONDS> 0
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<COMMON> 24
<OTHER-SE> 93,365
<TOTAL-LIABILITY-AND-EQUITY> 108,848
<SALES> 27,593
<TOTAL-REVENUES> 27,593
<CGS> 8,660
<TOTAL-COSTS> 8,660
<OTHER-EXPENSES> 12,931
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 22
<INCOME-PRETAX> 6,483
<INCOME-TAX> 1,524
<INCOME-CONTINUING> 4,959
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,959
<EPS-PRIMARY> 0.20
<EPS-DILUTED> 0.19
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<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 6,665
<SECURITIES> 31,467
<RECEIVABLES> 23,097
<ALLOWANCES> (784)
<INVENTORY> 455
<CURRENT-ASSETS> 69,538
<PP&E> 13,389
<DEPRECIATION> (6,196)
<TOTAL-ASSETS> 101,922
<CURRENT-LIABILITIES> 12,854
<BONDS> 0
0
0
<COMMON> 24
<OTHER-SE> 88,521
<TOTAL-LIABILITY-AND-EQUITY> 101,922
<SALES> 24,072
<TOTAL-REVENUES> 24,072
<CGS> 7,509
<TOTAL-COSTS> 7,509
<OTHER-EXPENSES> 11,443
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 26
<INCOME-PRETAX> 5,549
<INCOME-TAX> 1,337
<INCOME-CONTINUING> 4,212
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,212
<EPS-PRIMARY> 0.17
<EPS-DILUTED> 0.17
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<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> DEC-31-1996
<CASH> 8,121
<SECURITIES> 26,728
<RECEIVABLES> 22,565
<ALLOWANCES> (709)
<INVENTORY> 21,856
<CURRENT-ASSETS> 65,641
<PP&E> 11,785
<DEPRECIATION> (5,446)
<TOTAL-ASSETS> 98,276
<CURRENT-LIABILITIES> 12,623
<BONDS> 0
0
0
<COMMON> 24
<OTHER-SE> 84,951
<TOTAL-LIABILITY-AND-EQUITY> 98,276
<SALES> 71,439
<TOTAL-REVENUES> 71,439
<CGS> 27,498
<TOTAL-COSTS> 27,498
<OTHER-EXPENSES> 34,282
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 478
<INCOME-PRETAX> 11,359
<INCOME-TAX> (534)
<INCOME-CONTINUING> 11,893
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,893
<EPS-PRIMARY> 0.50
<EPS-DILUTED> 0.47
</TABLE>
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<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 6,309
<SECURITIES> 32,926
<RECEIVABLES> 17,814
<ALLOWANCES> (615)
<INVENTORY> 632
<CURRENT-ASSETS> 61,724
<PP&E> 10,665
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