Pegasystems Announces Settlements of Lawsuits
CAMBRIDGE, Mass., Dec. 20, 2000 — Pegasystems announced today that the U.S. District Court granted final approval to settlements in two separate securities class action lawsuits pending against the Company relating to its past restatements of revenue for certain quarters in 1997 and 1998. In the Chalverus litigation, brought on behalf of purchasers of Pegasystems stock between July 29, 1997 and October 29, 1997, the Company will issue to the Settlement Fund 1,385,000 shares of Pegasystems stock. Certain members of the Board of Directors of the Company have agreed to purchase such shares from the Settlement Fund for $5 million in cash. Together with cash previously advanced, the total value of the consideration paid to the class for the settlement of the Chalverus litigation amounts to $5.25 million.
In the Gelfer litigation, brought on behalf of purchasers of Pegasystems common stock between April 2, 1998 and November 23, 1998, the Company will issue to the Settlement Fund 1,740,000 shares of Pegasystems stock and will contribute cash of $2,389,060. Certain members of the Board of Directors have agreed to purchase such shares from the Settlement Fund for $5,360,940 in cash. Together with cash previously advanced, the total value of the consideration paid to the class for the settlement of the Gelfer litigation was $12.25 million.
Pegasystems previously received $4.3 million in cash from its insurer in connection with these settlements.
"We are delighted to have these lawsuits behind us and look forward to working to increase shareholder value in the coming year," said Rick Jones, president of Pegasystems. "The financial support by the Board clearly reinforces their confidence in our Company and its future."
Certain statements contained in this press release may be construed as "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. These statements involve various risks and uncertainties which could cause the Company's actual results to differ from those expressed in such forward-looking statements. These risks and uncertainties include the impact of pending litigation and regulatory proceedings, material weaknesses in the Company's financial control environment, difficulty in predicting the completion of product implementations and consequently the timing of revenue recognition, the inability to attract and retain key employees, reliance on key third-party relationships, management of the Company's growth and other risks and uncertainties. Further information regarding these and other factors which could cause the Company's actual results to differ materially from any forward-looking statements contained in this press release is contained in the Company's 1999 annual report on Form 10-K/A on file with the Securities and Exchange Commission.
Pegasystems (NASDAQ: PEGA) develops strategic applications for marketing, sales, service, and operations. Pega’s applications streamline critical business operations, connect enterprises to their customers seamlessly in real-time across channels, and adapt to meet rapidly changing requirements. Pega’s Global 3000 customers include many of the world’s most sophisticated and successful enterprises. Pega’s applications, available in the cloud or on-premises, are built on its unified Pega 7 platform, which uses visual tools to easily extend and change applications to meet clients’ strategic business needs. Pega’s clients report that Pega gives them the fastest time to value, extremely rapid deployment, efficient re-use, and global scale. For more information, please visit us at www.pega.com.
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The information contained in this press release is not a commitment, promise, or legal obligation to deliver any material, code or functionality. The development, release and timing of any features or functionality described remains at the sole discretion of Pegasystems, Pegasystems specifically disclaims any liability with respect to this information.
Lisa Pintchman Rogers
VP, Corporate Communications
Director, Corporate Communications
Sr. Manager, Public Relations
Director, Corporate Communications
+44 (0) 118 9651 660
PR & Communications Manager
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Cambridge, MA 02142
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