Carl Icahn Issues Statement Concerning BEA

Oct 26, 2007, 01:00 ET from Carl C. Icahn

    NEW YORK, Oct. 26 /PRNewswire/ -- Today, Carl C. Icahn announced that
 he sent the following letter to BEA Systems, Inc. (Nasdaq:   BEAS)
     October 26, 2007
     BEA Systems, Inc.
     2315 North First Street
     San Jose, California 95131
     To The Board Of Directors Of BEA:
     I am the largest shareholder of BEA, holding over 58 million shares and
 equivalents. I am sure that the BEA Board would agree with me that it would
 be desirable not to have to put BEA through a disruptive proxy fight, a
 possible consent solicitation and a lawsuit. This can be very simply
 avoided if BEA will commit to the two following conditions:
     -- BEA should allow its shareholders to decide the fate of BEA by
 conducting an auction sale process and allowing the shareholders to accept
 or reject the proposal made by the highest bidder. BEA should not allow the
 stalking horse bid from Oracle to disappear (failure to take the Oracle bid
 as a stalking horse would be a grave dereliction of your fiduciary duty in
 my view). If a topping bid arises, then all the better. But if no topping
 bid arises it should be up to the BEA shareholders to decide whether to
 take the Oracle bid or remain as an independent Company - - not this Board,
 members of which presided over the reprehensible "option" situation at BEA,
 a Board that has watched while, according to Oracle in its September 20,
 2007 conference call, Oracle's Middleware business "grew 129% compared with
 the decline of 9% for BEA".
     -- BEA should agree not to take any action that would dilute voting by
 issuing stock, entrench management or derail a potential sale of BEA. We
 are today commencing a lawsuit in Delaware demanding the holding of the BEA
 annual shareholder meeting before any scorched earth transactions (such as
 stock issuances, asset sales, acquisitions or similar occurrences) take
 place at BEA, other than transactions that are approved by shareholders. As
 we stated above, this lawsuit can easily be avoided.
     Your recent press releases regarding Oracle's proposal to acquire BEA
 indicate to me that you intend to find ways to derail a sale and maintain
 your control of the company. In particular I view your public declaration
 of a $21 per share "take it or leave it" price as a management entrenchment
 tactic, not a negotiating technique. BEA is at a critical juncture and it
 finds itself with a "holdover Board". BEA has not held an annual meeting in
 over 15 months and has not filed a 10K or 10Q for an accounting period
 since the quarter ended April 30, 2006. Those failures have arisen out of a
 situation that occurred under the watch of many of the present Board
     You should have no doubt that I intend to hold each of you personally
 responsible to act on behalf of BEA's shareholders in full compliance with
 the high standards that your fiduciary duties require, especially in light
 of your past record. Responsibility means that shareholders should have the
 choice whether or not to sell BEA. BEA belongs to its shareholders not to
                                    Very truly yours,
                                    Carl C. Icahn

SOURCE Carl C. Icahn