Oracle said inthat it may abandon its hostile takeover bid for PeopleSoft because of the possible added costs that could arise from the customer assurance program. But an attorney for PeopleSoft, in a letter to the court, said the terms of the program had already expired and that over the past several weeks the board of directors has been evaluating whether to continue it in some form.
"We cannot predict the determination that the PeopleSoft board will reach. There are, of course, a variety of possibilities, including not reinstituting any such program and reinstituting the form of the program with which Oracle has quite publicly maintained that it has no objection or concern. The board may also determine to adopt a different iteration of the program--one to which Oracle may, or may not, express objection," said Donald Wolfe, a PeopleSoft attorney, in the letter to the court.
A decision on the guarantees is expected to be reached at a PeopleSoft board meeting scheduled for Monday, Wolfe said in the filing.
A spokeswoman for Oracle declined to comment on the filing. A spokesman for PeopleSoft said the company does not comment on board meetings or items scheduled for discussion.
Oracle and PeopleSoft shareholders recently filed a motion with the court to hear the case on an expedited schedule.
Oracle is seeking to remove PeopleSoft's anti-takeover measure, otherwise known as a poison pill, as well as its use of the customer guarantee program.
PeopleSoft, in the third quarter, increased the terms of its. The program, which called for a rebate of two to five times the software licensing fee, would have been triggered if PeopleSoft had been acquired within two years of a customer signing a contract and the acquiring company reduced support for PeopleSoft products within four years of that date. Previously, the rebate would have kicked in only if a company bought PeopleSoft within one year of a customer signing a contract and cut support within two years.
PeopleSoft, in a recent filing with the Securities and Exchange Commission, estimated the cost of the customer assurance program, if triggered, at at least $800 million. Oracle has a $7.3 billion cash offer on the table.