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Oracle Delivers Letter to Board of BEA Systems


Oracle Corporation (NASDAQ: ORCL) announced that it had delivered a letter to the board of directors of BEA Systems, Inc. (NASDAQ: BEAS). The text of the letter follows:
October 25, 2007

Board of Directors
BEA Systems, Inc.
2315 North First Street
San Jose, CA 95131

Dear Members of the Board of Directors:
We believe that your counterproposal at $21 per share price is an impossibly high price for Oracle or any other potential acquirer. At $21 per share, the BEA board is asking for an 80% premium to BEA’s stock price before the appearance of activist shareholders who are pushing the BEA Board to sell the company. The $21 per share price is a multiple of nearly eleven times BEA’s last twelve months reported maintenance revenues. Nobody would seriously consider paying that kind of multiple for a software company with shrinking new license sales.

Furthermore, no other company has come forward to bid for BEA. Our proposal at $17 per share is the only offer. Apparently no other companies think that BEA is worth $17 per share, let alone $21 per share. Accordingly, we repeat our proposal to purchase BEA at $17 per share, a price that we are unwilling to increase. We do not believe BEA is worth more than that and we have an obligation to our own shareholders to exercise price discipline when evaluating acquisition opportunities.

We urge the BEA Board to put our $17 per share proposal to the shareholders for a vote. But if BEA’s objective is to remain independent, then the $21 per share counterproposal is a perfect strategy because there are no bidders above $17 per share. If the BEA board continues to refuse to execute an acquisition agreement at $17 per share, our proposal will expire at 5 p.m., PDT, on Sunday, October 28, 2007, at which time Oracle will move on and evaluate other potential acquisitions.


/s/ Charles Phillips
Charles Phillips

Additional Information and Forward-Looking Statement
This announcement is neither an offer to purchase nor a solicitation of an offer to sell securities of BEA Systems, Inc. Subject to future developments, additional documents regarding a transaction with BEA may be filed with the Securities and Exchange Commission (the “Commission”) and, if and when available, would be accessible for free at the Commission’s website at Investors and security holders are urged to read such disclosure documents, if and when they become available, because they will contain important information. The disclosure documents may also be obtained for free from Oracle, if and when available, by directing a request to Oracle, 500 Oracle Parkway, Redwood Shores, Attention: Investor Relations.

Oracle is not currently engaged in a solicitation of proxies or consents from the stockholders of BEA. However, in connection with its proposal to acquire BEA, certain directors and officers of Oracle may participate in meetings or discussions with BEA stockholders. Oracle does not believe that any of these persons is a “participant” as defined in Schedule 14A promulgated under the Securities Exchange Act of 1934, as amended, in the solicitation of proxies or consents, or that Schedule 14A requires the disclosure of certain information concerning any of them. Information about Oracle’s executive officers and directors is available in Oracle’s Form 10-K for the year ended May 31, 2007, filed with the Commission on June 29, 2007. If in the future Oracle does engage in a solicitation of proxies or consents from the stockholders of BEA in connection with its proposal to acquire BEA, it will amend the information provided above to disclose the information concerning participants in that solicitation required by Rule 14a-12 under the Securities Exchange Act of 1934.

No assurance can be given that the proposed transaction described in this release will be consummated by Oracle, or completed on the terms proposed or any particular schedule, that the proposed transaction will not incur delays in obtaining the regulatory or stockholder approvals required for a transaction or that we will realize the anticipated benefits of any proposed transaction.

Any statements made in this release that are not statements of historical fact, including statements about our beliefs and expectations, including the proposed business combination of Oracle and BEA, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and should be evaluated as such. Forward-looking statements include statements that may relate to our plans, objectives, strategies, goals, future events, future revenues or performance, and other information that is not historical information. These forward-looking statements may be identified by words such as “anticipate,” “expect,” “suggests,” “plan,” “believe,” “intend,” “estimates,” “targets,” “projects,” “could,” “should,” “may,” “will,” “would,” “continue,” “forecast,” and other similar expressions. Although we believe that these forward-looking statements and projections are based on reasonable assumptions at the time they are made, you should be aware that many factors could cause actual results or events to differ materially from those expressed in the forward-looking statements and projections.

Factors that may materially affect such forward-looking statements include: our ability to successfully complete any proposed transaction or realize the anticipated benefits of a transaction; and delays in obtaining the regulatory or stockholder approvals required for the transaction, or an inability to obtain them on the terms proposed or on the anticipated schedule; and other factors described generally in Oracle’s periodic reports filed with Commission. We do not intend to, and do not undertake a duty to, update any forward-looking statement or projection in the future to reflect the occurrence of events or circumstances, except as required by law. Any information concerning BEA contained in this release has been taken from, or is based upon, BEA’s publicly available information and Oracle does not take any responsibility for the accuracy or completeness of such publicly available information.


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