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Forum Report: List of campaign commitments to be monitored

(September 9, 2001)

From: Gary Lutin
Sent: Sunday, September 09, 2001 9:22 PM
Subject: List of campaign commitments to be monitored

A letter was sent Friday afternoon to members of CA's board of directors congratulating them on their election to represent the interests of shareholders, and offering them an opportunity to comment on a list of their reported campaign commitments to assure fair and reasonable monitoring of the board's performance during the next year.  The letter's text is copied below, and in an attached "RTF" file.
You'll note that in some cases I've suggested specific requirements for the effective delivery of what was reportedly promised in fairly general terms.  For example, a commitment to submit the poison pill to a vote in five years would be meaningless unless the current board acts right now to amend the Rights Agreement with a binding provision for that process.  (The board members elected to serve for the next one year term are not in a position to make any commitments on behalf of board members who will be elected in the future, and the future board will in any event be bound by fiduciary duties to exercise individual judgment in the context of whatever conditions exist at that time.)
It is my understanding that Newsday, which has been serving as the "newspaper of record" fo the CA contest and maintains a very effective archive on its "Complete Coverage of the CA Proxy Fight" web site, intends to use the Forum's list -- as presented in the letter and considering any responsive comments from CA's board -- for continued monitoring of the commitments made to shareholders.
I want to thank all of you who participated in this Forum, and hope that you as well as all of CA's shareholders will benefit from your contributions to the process.
                GL - 9/9/01

Text of 9/7/01 letter from Gary Lutin to members of the CA board of directors
Telephone (212) 605-0335
Facsimile (212) 605-0325
September 7, 2001
By telecopier: 631/342-4900
Mr. Russell M. Artzt,
Mr. Linus W.L. Cheung,
Mr. Alfonse M. D'Amato,
Mr. Richard A. Grasso,
Ms. Shirley Strum Kenny,
Mr. Sanjay Kumar,
Mr. Roel Pieper,
Mr. Lewis S. Ranieri,
Mr. Willem F.P. de Vogel, and
Mr. Charles B. Wang
Computer Associates International, Inc.
One Computer Associates Plaza
Islandia, New York 11749
To the members of the board of directors:
    I am encouraged by Forum participants to congratulate each of you on your re-election to represent the interests of Computer Associates' shareholders, and on your accommodations of their concerns.
    As you probably know, however, there have been many confusing reports of the campaign commitments on which shareholders based their support for you. For the board's guidance, as well as for shareholders and others who will be monitoring your performance, everyone needs a reliable list of what you were elected to do.
The following list of commitments is therefore submitted for your review, to provide you with an opportunity to clarify the reports of Forum participants and published news articles:
1.    New board members: Management representatives were reported to have stated that the board intends to add at least two new, independent members by the end of this year.
2.    Shareholder suggestions of board candidates: Reports of commitments to consider candidates suggested by shareholders were inconsistent, and included unverified reports of preferential arrangements. Unless you publish specific procedures, it will be assumed that any shareholder may present candidates to the board, and that the board and its professional advisers will properly consider all such candidates on the basis of their qualifications.
3.    Poison pill -- Termination: The reported commitment to submit the Rights Agreement to a vote in five years will require formal action by the current board, during its one year tenure, to modify the agreement's term provisions.
4.    Poison pill -- Restricted application: A formal board resolution is required to confirm management assurances that shareholder Walter Haefner will not be declared an "Adverse Person."
5.    Compliance -- Investor information: Although management has expressed an intent to stop using "pro forma" reporting next year, it is assumed that the board will require compliance with published FEI standards for any continuing presentations of non-GAAP numbers.
6.    Compliance -- Conduct of relationships: It has been reported that a special committee of the board will take actions to investigate and monitor management compliance with approved policies for the company's conduct of its relationships with employees, customers, and others.
    Please let me know if you require more than a week to prepare any comments. You should of course respond according to your own procedures for investor communications, but you may assume that I will provide Forum participants with whatever comments you offer to assure the list's fair and reasonable use.
    Upon concluding my responsibilities relating to Computer Associates, I am confident that the members of the board as well as the shareholders you serve will benefit from the efforts of Forum participants to define your common interests in value enhancement.
Very truly yours,
Gary Lutin


The Forum is open to all Computer Associates ("CA") shareholders, whether institutional or individual, and to any fiduciaries or professionals concerned with their investment decisions.  Its purpose is to provide shareholders with access to information and a free exchange of views on issues relating to their evaluations of alternatives, as described in the Forum Summary.

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