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Dear Sybase Stockholder:
As you may be aware from the Proxy Statement relating to our 1998 Annual
Meeting that was previously mailed to you, one of the matters to be voted on at
the Annual Meeting is a shareholder proposal filed by the California Public
Employees' Retirement System (CalPERS) recommending that Sybase amend its
bylaws to declassify its Board of Directors. Sybase's Board has considered this
proposed change, concluded that the declassification of the Board is not in the
best interests of stockholders and recommended that stockholders vote against
that proposal (proposal #5). In an effort to force their position through,
CalPERS has turned to the media and may have sent to you an "urgent message"
about Sybase. The news reports that resulted from CalPERS' media efforts
convey, in Sybase's opinion, a very misleading impression of our concern for
the views of our stockholders and how we work with stockholders.
Sybase is genuinely concerned with issues of corporate governance and promoting
stockholder value. Sybase regularly meets with stockholders to discuss the
Company's business, the actions being taken to improve financial performance,
and other issues raised by our stockholders. For example, we have met with
representatives of CalPERS more than once to discuss their concerns.
Sybase is committed to promoting accountability and implementing of effective
corporate governance practices. In fact after reviewing our corporate
governance standards and practices last year, CalPERS wrote that, while they
would continue to monitor performance, "the only corporate governance change
left to enact is de-staggering the terms of election." When CalPERS requested
that Sybase's Board consider that proposal, a special Board of Directors
Meeting was convened promptly. The Board determined that the proposed change
would not be in the best interests of stockholders and, although they did not
agree with the results, CalPERS stated that "it was satisfied that the board
had given the matter its serious attention."
CalPERS' communications noted that four of Sybase's directors "have not seen
fit to invest any of their own money to purchase any shares outright." In fact,
in Sybase's February 1998 Board Meeting, the Board itself raised the issue of
the importance of stock ownership by directors, agreed that all directors should
purchase shares in Sybase and directed that a plan be developed by the lead
independent director and legal counsel to ensure such stock ownership.
In the final analysis, Sybase believes that corporate accountability depends on
responsible and experienced individuals diligently fulfilling their obligations
to the stockholders. We remain steadfastly committed to that conviction and to
our common objective of enhanced stockholder value.
Very truly yours,
/s/ MITCHELL E. KERTZMAN
Mitchell E. Kertzman
Chairman of the Board and
Chief Executive Officer
