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<title>[LOSC] SCO Files Chapter 11</title>
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<p class=MsoNormal><font size=2 color=blue face=Verdana><span style='font-size:
10.0pt;font-family:Verdana;color:blue'>FYI<o:p></o:p></span></font></p>
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<p class=MsoNormal style='margin-left:.5in'><b><font size=2 face=Tahoma><span
style='font-size:10.0pt;font-family:Tahoma;font-weight:bold'>From:</span></font></b><font
size=2 face=Tahoma><span style='font-size:10.0pt;font-family:Tahoma'> Reynaud,
Jean Yves [mailto:jeanyves.reynaud@eds.com] <br>
<b><span style='font-weight:bold'>Sent:</span></b> Monday, September 17, 2007
3:28 AM<br>
<b><span style='font-weight:bold'>To:</span></b> Brown, David (Test Department)<br>
<b><span style='font-weight:bold'>Subject:</span></b> [LOSC] SCO Files Chapter
11</span></font><o:p></o:p></p>
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<p class=MsoNormal style='margin-left:.5in'><font size=3 face="Times New Roman"><span
style='font-size:12.0pt'><o:p> </o:p></span></font></p>
<p style='margin-left:.5in'><font size=2 color=blue face=Verdana><span
style='font-size:10.0pt;font-family:Verdana;color:blue'>Sure you've seen it.
But in case.</span></font> <o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>The SCO Group's tale of woe may be nearing its grim
conclusion. The company filed for Chapter 11 bankruptcy protection in the <st1:country-region
w:st="on"><st1:place w:st="on">US</st1:place></st1:country-region> on Friday,
one month after losing the farm on its Linux litigation strategy.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>The company's already terminal share price took
another 43% dive on the news. Its shares were changing hands at $0.37 when the
market closed Friday afternoon.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>At the end of April, SCO was given six months to
bring its share price back up above $1, the cut-off under which it has
languished since March 13, or get kicked off the Nasdaq stock exchange.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>The market now values SCO at just $7.9m, a little
over half of its cash balance at the end of its April quarter.</span></font> <br>
<font size=2 face=Verdana><span style='font-size:10.0pt;font-family:Verdana'>Ironically,
one of SCO's biggest creditors may end up being Novell, the Linux company SCO
unsuccessfully sued over intellectual property relating to the operating
system.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>A <st1:country-region w:st="on"><st1:place w:st="on">US</st1:place></st1:country-region>
judge ruled last month that Novell is entitled to a slice of the $25.9m license
fees Microsoft and Sun paid SCO for use of intellectual property SCO claimed to
own.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>Judge Dale Kimball decided that Novell, instead, is
the rightful owner of the Unix System V copyrights that SCO had asserted it
owned and licensed under its SCOsource program. </span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>SCO has appealed this decision, saying the Sun and
Microsoft deals related to different technology. Kimball last week denied its
request to fast-track this appeal.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>Payment of fees to Novell, amount to be determined
at trial, would be difficult. SCO's April 30 balance sheet shows just $18.9m in
assets, just $13.2m of which was in cash or equivalents.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>Kimball's pre-trial ruling last month essentially
dashed SCO's hopes of winning against Novell, and has undermined its case
against IBM -- terminally, according to IBM.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>Despite SCO's problems, the company insisted Friday
that its customers can count on its continued support while it undergoes
Chapter 11 restructuring.</span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 face=Verdana><span style='font-size:
10.0pt;font-family:Verdana'>"We want to assure our customers and partners
that they can continue to rely on SCO products, support and services for their
business critical operations," said SCO CEO Darl McBride. </span></font><o:p></o:p></p>
<p style='margin-left:.5in'><font size=2 color=blue face=Verdana><span
style='font-size:10.0pt;font-family:Verdana;color:blue'>See also some
interesting articles on Groklaw </span></font><a
href="http://www.groklaw.net/article.php?story=20070914152904577"><font size=2
face=Verdana><span style='font-size:10.0pt;font-family:Verdana'>http://www.groklaw.net/article.php?story=20070914152904577</span></font></a>
<o:p></o:p></p>
<p style='margin-left:.5in'><b><font size=1 color=navy face="Trebuchet MS"><span
style='font-size:7.5pt;font-family:"Trebuchet MS";color:navy;font-weight:bold'>Jean-Yves
Reynaud</span></font></b><b><font size=1 color=silver face="Trebuchet MS"><span
style='font-size:7.5pt;font-family:"Trebuchet MS";color:silver;font-weight:
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