Shares of Baan have traded as low as $2.25 per share, which is below the minimum level agreed upon in a financing deal that Bear Stearns and the Dutch software firm signed in March.
The agreement gave Bear Stearns the option to decline further financing if Baan's stock price falls below a certain level. But the investment firm will waive that requirement and continue to address future financing for Baan on a "case-by-case basis going forward as needed," the companies said in a statement.
In recent weeks, Baan has seen its stock tumble, due somewhat to the overall negative performance of most technology stocks, as concerns swayed investors to put their money in more stable and traditional businesses. Baan also recently reported its seventh consecutive quarterly loss, fueled by sliding new software sales and a major slump in overall revenues.
The company continues to struggle with recent executive departures, repeated quarterly losses and a companywide reorganization aimed at helping Baan focus on capturing more lucrative Internet business deals.
Baan was late to embrace the Internet. Rivals Oracle, SAP, PeopleSoft and JD Edwards have all been busy shifting their focus to providing Web-friendly front-office software and moving away from their core business--software that manages a company's back office, such as its human resources, manufacturing and financial needs.
New sales for traditional back-office software, or enterprise resource planning (ERP) applications, continue to slump, while other areas, such as customer relationship management (CRM) and procurement, or business e-commerce, software, continue to grow at a faster rate. Market research firm International Data Corp. expects the worldwide market for CRM software to reach $11 billion in 2003, up from $1.9 billion in 1998.
Baan shares have steadily fallen since the abrupt departure of chief executive officer Mary Coleman and chief financial officer James Mooney, who followed her exit a little more than a week later. Coleman, who has since taken a spot at the Internet Capital Group, was touted as a key force behind a Baan turnaround.