According to a Press Release dated Oct 25, 2001, a complaint was filed alleging violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. On or about September 23, 1999, eGain
commenced an initial public offering of 5,000,000 of its shares of common stock at an offering price of $12 per share (the "eGain IPO"). In connection
therewith, eGain filed a registration statement, which incorporated a prospectus (the "Prospectus"), with the SEC. The complaint further alleges that the Prospectus was materially false and misleading because it failed to disclose, among other things, that: (i) Robertson Stephens, DLJ, and Volpe Brown had solicited and received excessive and undisclosed commissions from certain investors in exchange for which Robertson Stephens, DLJ, and Volpe Brown allocated to those investors material portions of the restricted number of eGain shares issued in connection with the eGain IPO; and (ii) Robertson Stephens, DLJ, and Volpe Brown had entered into agreements with customers whereby Robertson Stephens, DLJ, and Volpe Brown agreed to allocate eGain shares to those customers in the eGain IPO in exchange for which the customers agreed to purchase additional eGain shares in the aftermarket at pre-determined prices.