SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. ___)
Filed by the Registrant [_]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[_] Definitive Proxy Statement
[X] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-12
COMPUTER ASSOCIATES INTERNATIONAL, INC.
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(Name of Registrant as Specified in its Charter)
RANGER GOVERNANCE, LTD.
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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EXPLANATORY NOTE
Ranger Governance, Ltd., a Texas limited partnership ("Ranger"), is filing
the materials contained in this Schedule 14A with the Securities and Exchange
Commission in connection with a solicitation of proxies (the "Solicitation") in
support of electing Ranger nominees to the board of directors of Computer
Associates International, Inc. ("Computer Associates") at the 2001 annual
meeting of stockholders of Computer Associates.
Table of Contents
-----------------
Ranger cover letter, dated as of August 9, 2001....................... Item 1
Transcript of Ranger video, dated as of August 9, 2001................ Item 2
Ranger press release, dated as of August 9, 2000...................... Item 3
Contents of Item 1-3
--------------------
RangerGovernance
Dear Fellow Computer Associates Shareholder:
We at Ranger Governance believe that Computer Associates is broken, but we have
a plan to fix it. The enclosed video details Ranger's comprehensive plan for
Computer Associates. We believe our plan will enhance CA's credibility with
investors, customers and employees and get CA growing so we can build value for
shareholders. Please take a few minutes to view this brief video. I am confident
that it will help you to better understand our plan for CA as well as our vision
of what the future could hold for CA and its shareholders.
You have probably already received both a white and a GREEN proxy card. If you
believe in our plan and want to enact change at CA, please vote the GREEN proxy
card. If you have misplaced your proxy, you will be receiving another one in the
mail shortly.
Please remember that only your latest dated proxy card counts. Please return
only the GREEN proxy card.
Should you have any questions, please contact our proxy solicitor, Morrow & Co,
Inc. at 800-607-0088.
Integrity. Innovation. Accountability.
Ranger: A Better Way For CA
Thank you for your consideration.
Sincerely,
/s/Sam Wyly
Sam Wyly
Manager, Ranger Governance
================================================================================
Street-Name Holders
-------------------
If you hold your Computer Associates shares with a brokerage firm or bank, only
they can exercise voting rights with respect to your shares and only upon
receipt of your specific instructions, Accordingly, it is critical that you
promptly contact the person responsible for your account and give instructions
to vote the GREEN proxy card FOR the election of the Ranger Governance nominees.
Please note, your bank or broker will keep your vote CONFIDENTIAL.
Computer Associates Employees
-----------------------------
If you hold your shares in the Savings Harvest Plan or Employees Stock Purchase
Plan, your vote is CONFIDENTIAL. You may direct the Plan Trustee how to vote
your shares by signing, dating and returning the GREEN instruction form provided
by the Plan Trustee. Completed instructions must be received by the Savings
Harvest Plan Trustee at the address set forth in the GREEN instruction form no
later than the close of business on August 27, 2001 for your vote to be counted.
Even if you have sent a white proxy card to Computer Associates, you have every
right to change your vote. You may revoke that proxy, and vote for the Ranger
Governance slate by signing, dating and mailing the GREEN Proxy. If you have any
questions on how to vote your shares, please call our proxy solicitor:
MORROW & CO., INC. at (800)607-0088
================================================================================
About Ranger Governance, Ltd.
Ranger Governance is a Dallas-based investment company created by entrepreneurs
Sam Wyly and Charles Wyly, and an affiliate of Ranger Capital Group, a
multi-manager investment fund also based in Dallas. On July 27, 2001, Ranger
Governance filed a definitive proxy statement with the Securities and Exchange
Commission in connection with Ranger's solicitation of proxies to elect its
director nominees at the 2001 annual stockholders meeting of Computer Associates
and has mailed copies to stockholders. Ranger is proposing a comprehensive
restructuring plan which it believes will maximize shareholder value, position
Computer Associates for future growth, and dramatically improve its relations
with customers, employees and investors. Ranger urges stockholders to read its
proxy statement because it contains important information. More information
about Ranger Governance and copies of its definitive proxy statement are
available at www.rangergov.com. Copies of Ranger's definitive proxy statement
and other Ranger soliciting materials are also available at the Securities and
Exchange Commission's website at www.sec.gov.
Video Script
Page 1 of 15
Ranger Video Script
Open on MS of Sam...push in slightly Hello, my name is Sam Wyly, and
I want to tell you about Ranger
Governance and our efforts to
enhance the value of CA for the
Company's shareholders, for its
customers and for its employees.
I'm sure I don't have to tell
you that our company is under
performing.
Cut to graphic:
CA's Return vs. Software Industry
CA: Negative 14%
Software Industry: 169%
Include footnote: Total five-year return for
period ending March 31, 2001. Under the current management,
return to investors has been
negative 14% over the past five
years... this is at a time when
the average software company
index rose 169%.
Cut to Sam That's right... during the
biggest bull market and software
boom in history, the current
board of Computer Associates has
managed to turn each 100 of your
Video Script
Page 2 of 15
dollars into only 86.
Unfortunately, the story doesn't
end there.
Cut to NYT and Newsday articles
The trouble isn't limited to
chronic financial under-
performance and a sagging share
price.
That is why Ranger wants to work
with you to help our company
reach its full potential.
Cut to headlines of announcement of
Ranger's proxy fight. On June 21, we launched a bid to
replace the incumbent Board with
a new and independent board that
intends to do the right things
for the company, for its
employees, for its customers and
for you, its owners.
Before I go into the reasons why
we believe management must be
changed now, let me tell you why
we think the Ranger
Video Script
Page 3 of 15
nominees are well qualified to
lead this effort.
First, a little bit about me.
Cut to video or stills and headlines
documenting Sam's Career I've been an entrepreneur and an
investor for over 30 years, and
have founded several successful
enterprises, including, most
recently, ten years ago,
Maverick Capital... a leading
equity hedge fund, which has
grown in 10 years from $15
million in family money to
almost $8 billion.
But my lifelong passion and
first real success was in the
software industry.
Cut to headlines of UCC sale to CA
The first company I founded,
University Computing was merged
into CA fourteen years ago.
Cut to headlines of Sterling Software sale
to CA
Another company I
founded...Sterling Software...
merged into
Video Script
Page 4 of 15
CA just last year.
Cut to Sam
So, I have a special interest in
seeing that Computer Associates
prospers and grows.
I believe that by any
performance measure, this
company has clearly under-
performed, compared to other
software companies and also
compared to what our management
teams were able to accomplish at
Sterling Software.
Cut to graphic:
CA vs. SWW
Source: Bloomberg
Note: SWW was acquired by CA on
4/28/00 Just compare CA's performance to
that of Sterling Software - a
company whose structure and
culture, I believe, created much
better growth. Over the 5-year
period before CA acquired
Sterling, $100 dollars invested
in CA grew to $295. But that
same $100 invested in Sterling
would have grown to $568 --proof
that the entrepreneurial company
with the
Video Script
Page 5 of 15
innovative structure and culture
had the best performance.
Cut to Business Week and NYT headlines
What do Business Week and the
New York Times say about this
board, about its performance and
about its pay policy?
Cut to Business Week quote
Business Week said that CA's
board authorized America's worst
pay for performance in 2000.
Business Week also named this
board one of America's worst.
Cut to Business Week graphic
Cut to NYT headlines
Moreover, CA's "creative
accounting" practices and its
poor treatment of its employees
have both been exposed by the
New York Times.
Cut to Newsday headlines
Cut to NYT photo
Cut headlines and clips from NYT
And while all of this has been
going on, managers have been
given $1 billion worth
Video Script
Page 6 of 15
of company stock.
Cut to headlines from NYT and Newsday In April, The New York Times
wrote an in-depth investigative
article that supported many of
our worst suspicions about the
company and its current
managers.
Also, the media continues to
report on the controversy
surrounding CA's employee
practices.
Both the New York Times and
Newsday have reported on top
managers' widespread practice in
which employees who'd never had
a bad review were fired for
"cause," without severance,
without health insurance.
Cut to Sam
Cut to Steve To further describe the reasons
why we believe that top
management must change, here's
Steve Perkins, a co-founder of
Sterling Commerce, and a Ranger
Board
Cut to NYT article
Video Script
Page 7 of 15
Nominee.
Thanks Sam. We at Ranger think
CA's arrogance is plainly seen
in its dealings with Wall
Street. Under current
management, the NYT has quoted
former employees saying that CA
should stand for "Creative
Accounting."
We believe its accounting
practices have strained its
credibility with the financial
community, and created
uncertainty among investors
about the value of the company.
Cut to graph showing Pro Forma Pro Rata
formula
Source: CA press release 4/16/01 They have changed the way they
report revenue every quarter,
saying this is necessary to
understand where their revenues
were coming from under their
"New Business Model." Let's see
about that.
Overlay revenues using GAAP
Using its new, untested Pro
Forma Pro
Video Script
Page 8 of 15
Rata formula, CA reported
revenues of $1.3 billion in the
4th quarter of 2000 and an
operating profit of [$0.47]
cents/share.
. When reported under the
standard rules of General
Accepted Accounting
Principles however, the
company's revenues were less
than half that, and it lost
$0.29 cents/share in the 4th
quarter of 2000.
Cut to Steve Why did they do this? We believe
that there was one very
significant reason ... they
tried to justify paying
themselves egregiously -in the
form of an excessive windfall of
$1 billion worth of stock. Your
current board approved this
payment for non-performance.
Sam.
Cut to Sam
Thanks, Steve. The more we
looked at this Company the more
we realized that it needs a
sustainable strategy to become
Cut to headlines from Dallas Morning
News
Video Script
Page 9 of 15
more competitive... and be more
responsive to customers... and
it needs it fast.
That's why Ranger Governance has
stepped forward with a plan of
action which we think will
rebuild the company and restore
integrity to operations...it
will reverse five years of
chronic under-performance... it
will increase shareholder value.
Cut to Graphic of Nominee Ad We think our plan builds on CA's
winning products, people and
customers to re-establish
Computer Associates as the
leading global provider of
software solutions.
Here's what we're doing.
First, we've assembled a slate
of independent directors --
people with proven records of
performance in software
companies and in other
companies, who
Cut to graphic of Mark Cuban
Cut to headlines of sale of Broadcast.com
Video Script
Page 10 of 15
have strong investment,
regulatory and corporate
governance experience.
to Yahoo!
Cut to graphic of Dr. Wendy Gramm
In addition to Steve, our
nominees include:
Mark Cuban whose history of
entrepreneurial success includes
Broadcast.com... sold to Yahoo!
in 1999.
Cut to graphic of Cece Smith
Dr. Wendy Lee Gramm, a
recognized expert in economic
and regulatory policy; and
former chairman of the Commodity
Futures Trading Commission...
Cut to Sam
Cece Smith, a successful venture
capitalist and former chair of
the Federal Reserve Bank of
Dallas;
Cut to Steve And a complete roster of other
highly qualified and proven
corporate leaders who have
decades of relevant experience
and
Video Script
Page 11 of 15
success.
Now back to Steve Perkins for
more on our plan. Steve...
Thanks Sam.
In order to restore credibility
with the financial community,
customers and employees, we will
institute a series of corporate
governance policies based on
what we think are the best
practices of the business world.
I want to assure you that I and
the other Ranger candidates will
observe the highest standards in
discharging our fiduciary duties
for the benefit--first and
foremost--of you, the
shareholders- the owners of CA.
Cut to graphic of four business units
Cut to Steve
We will strategically realign
the company into four
decentralized business units,
which we think will enhance the
Video Script
Page 12 of 15
company's ability to effectively
compete, innovate, and provide
standard-setting customer
service.
Cut to organization chart
This new alignment is not a
"break-up" of CA; Rather, it is
a correction to what we believe
is an excessively centralized
management structure which is
not sufficiently flexible to
fully meet customer needs. We
believe that this approach to
organization structure has been
key to the success of companies
such as Sterling Software, Texas
Instruments, GE and others.
Fade in "Single Point of Contact" under
chart
Fade in "National Account Sales Force"
under chart
Cut to graphic: We recognize that larger
enterprise customers may prefer
a single point of contact within
CA's sales organization. We
intend to establish a national
account sales force with the
ability to tap into the
expertise and synergies of each
of the four
Video Script
Page 13 of 15
business units.
Ranger envisions that each of
these business units will
produce separate income
statement, balance sheet and
cash flow information.
The Ranger Plan
Continuous product innovation
Expanded Product Offerings
Strategic Acquisitions
Research and Development
No Increased Cost
Cut to Steve We will also implement a program
of continuous product
innovation. We plan to expand
CA's product offerings through
strategic acquisitions and
investments in research and
development. We believe all this
can be done without increased
costs.
Overlay "New Corporate Culture" over
Steve
Once the individual strengths of
each of these business units is
understood, we believe that
investors will recognize greater
value in CA from the sum of its
parts.
Cut to Sam
Finally, we plan on building a
new
Video Script
Page 14 of 15
Cut to rangergov.com screen shot corporate culture for CA, one
that is customer-focused and
treats employees with the
respect that their hard work and
achievement deserve. Sam.
Cut to phone # at Morrow & Co.
Cut to Sam
These are the reasons we think
Computer Associates is broken,
and this is our plan to fix it.
Push in on Sam holding up the green proxy
card If you want more information or
want to ask us a question,
please visit our Web site at
www.rangergov.com, or call us at
1-800-607-0088
Cut to for more information graphic
Cut to "Permission for quotes neither
sought nor obtained" and list referenced
articles We are confident that our team
of highly respected and proven
executives will get CA growing.
Close on disclaimer All we need is your vote. Please
return the green proxy card,
which you will receive soon, to
vote for the Ranger team and our
Ranger plan.
Video Script
Page 15 of 15
Thank you for your time and
consideration.
For Immediate Release
RANGER GOVERNANCE MAILS VIDEO TO COMPUTER ASSOCIATES SHAREHOLDERS
Dallas, TX, August 9, 2001 - Ranger Governance, Ltd. today announced that it has
commenced its mailing of a videocassette entitled, The Ranger Plan: A Better Way
for CA, to Computer Associates (NYSE: CA) shareholders. The video can be viewed
on the Ranger Governance website, www.rangergov.com, by following the link to
"Information on Proxy Contest."
The video features Sam Wyly and Steve Perkins, two of Ranger's 10 director
nominees, explaining that "during the biggest bull market and software boom in
history, the current board of Computer Associates has managed to turn each 100
of your dollars into only 86.*" They also detail Ranger's plan for enhancing
credibility and value for CA shareholders.
Sam Wyly said, "We believe our comprehensive plan will enhance CA's credibility
with investors, customers and employees and will get CA growing to build value
for shareholders. Our video is an innovative way to communicate with CA
shareholders, and it illustrates the approach Ranger will bring to the Company.
CA's shareholders have, for too long, been given no alternative to the current
Board of Directors."
Steve Perkins added, "After watching our video, we think shareholders will
clearly understand that Ranger offers them a better way by moving the Company
toward and innovative management structure and closer to its current and
prospective customers. We are confident that shareholders who view our video
will find many reasons to vote for the Ranger nominees on Wednesday, August 29th
and help us to transform a company which we believe is not growing into one that
is."
* Total return for CA shareholders for the five-year period ending 3/31/01,
Source: Computer Associates Definitive Proxy Statement 7/18/01.
-more-
-2-
About Ranger Governance, Ltd.
Ranger Governance is a Dallas-based investment company created by entrepreneurs
Sam Wyly and Charles Wyly, and an affiliate of Ranger Capital Group, a multi-
manager investment fund also based in Dallas. On July 27, 2001, Ranger
Governance filed a definitive proxy statement with the Securities and Exchange
Commission in connection with Ranger's solicitation of proxies to elect its
director nominees at the 2001 annual stockholders meeting of Computer Associates
and has mailed copies to stockholders. Ranger is proposing a comprehensive
restructuring plan which it believes will maximize shareholder value, position
Computer Associates for future growth, and dramatically improve its relations
with customers, employees and investors. Ranger urges stockholders to read its
proxy statement because it contains important information. More information
about Ranger Governance and copies of its definitive proxy statement are
available at www.rangergov.com. Copies of Ranger's definitive proxy statement
and other Ranger soliciting materials are also available at the Securities and
Exchange Commission's website at www.sec.gov.
--------------------------------------------------------------------------------
Street-Name Holders
If you hold your Computer Associates shares with a brokerage firm or bank, only
they can exercise voting rights with respect to your shares and only upon
receipt of your specific instructions. Accordingly, it is critical that you
promptly contact the person responsible for your account and give instructions
to vote the GREEN proxy card FOR the election of the Ranger Governance nominees.
Please note, your bank or broker will keep your vote CONFIDENTIAL.
Computer Associates Employees
If you hold your shares in the Savings Harvest Plan or Employee Stock Purchase
Plan, your vote is CONFIDENTIAL. You may direct the Plan Trustee how to vote
your shares by signing, dating, and returning the GREEN instruction form
provided by the Plan Trustee. Completed instructions must be received by the
Savings Harvest Plan Trustee at the address set forth in the GREEN instruction
form no later than the close of business on August 27, 2001 for your vote to be
counted.
Even if you have sent a white proxy card to Computer Associates, you have every
right to change your vote. You may revoke that proxy, and vote for the Ranger
Governance slate by signing, dating and mailing the GREEN Proxy. If you have any
questions on how to vote your shares, please call our proxy solicitor:
MORROW & CO., INC. at (800) 607-0088
--------------------------------------------------------------------------------
Contact:
Media: Investors:
Dan Katcher/Joele Frank
Joele Frank, Wilkinson Brimmer Katcher Morrow & Co., Inc.
(212) 355-4449 (212) 754-8000
###