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The Elliott Associates $$ Agreements Behind the Novell-Attachmate Merger - Updated 4Xs
Friday, November 26 2010 @ 09:36 PM EST

Elliott Associates has filed with the SEC its own required filing, a 13D/A with all the financing documents behind the Novell acquisition by Attachmate. It says it amends a February 12, 2010 13D, which shows Elliott through its various tentacles beginning to buy Novell stock on the open market in January. First, who are all the Elliott entities?

The February 13D tells us:
ITEM 2. Identity and Background. (a)-(c)This statement is being filed by Elliott Associates, L.P., a Delaware limited partnership, and its wholly-owned subsidiaries (collectively, "Elliott"), Elliott International, L.P., a Cayman Islands limited partnership ("Elliott International"), and Elliott International Capital Advisors Inc., a Delaware corporation ("EICA" and collectively with Elliott and Elliott International, the "Reporting Persons"). Paul E. Singer ("Singer"), Elliott Capital Advisors, L.P., a Delaware limited partnership ("Capital Advisors"), which is controlled by Singer, and Elliott Special GP, LLC, a Delaware limited liability company (“Special GP”), which is controlled by Singer, are the general partners of Elliott. Hambledon, Inc., a Cayman Islands corporation ("Hambledon"), which is also controlled by Singer, is the sole general partner of Elliott International. EICA is the investment manager for Elliott International. EICA expressly disclaims equitable ownership of and pecuniary interest in any shares of Common Stock.
With that background, we can follow the next step. Elliott Associates, L.P. (through The Liverpool Limited Partnership) bought a lot of stock beginning in January. And Elliott International, the Cayman Islands entity, bought the rest, to a combined total of approximately 7.1% of Novell stock:
(a)Elliott beneficially owns 11,894,134 shares of Common Stock, which constitute 3.4% of all of the outstanding shares of Common Stock. The 11,894,134 shares of Common stock owned by Elliott are owned through The Liverpool Limited Partnership, a Bermuda limited partnership, which is a wholly-owned subsidiary of Elliott.

Elliott International and EICA beneficially own an aggregate of 12,805,866 shares of Common Stock, which constitute 3.7% of all of the outstanding shares of Common Stock.

Collectively, Elliott, Elliott International and EICA beneficially own 24,700,000 shares of Common Stock constituting 7.1% of all of the outstanding shares of Common Stock.

(b)Elliott has the power to vote or direct the vote of, and to dispose or direct the disposition of, the shares of Common Stock beneficially owned by it.

Elliott International has the shared power with EICA to vote or direct the vote of, and to dispose or direct the disposition of, the shares of Common Stock owned by Elliott International. Information regarding each of Elliott International and EICA is set forth in Item 2 of this Schedule 13D and is expressly incorporated by reference herein.

This is all preparatory to this current merger deal, in that Elliott Associates and Elliott International, the Cayman Islands entity, are putting up the dough, along with others, to make the merger between Novell and Attachmate happen, and Elliott gets an investment in Attachmate's parent, Wizard. Yes, Attachmate isn't the name of the parent. It has a parent, Wizard. You can see that in the Investment Agreement, Exhibit E attached to the 13D/A, which begins:
INVESTMENT AGREEMENT, dated as of November 21, 2010 (this “Agreement”), by and among Wizard Parent LLC, a Delaware limited liability company (“Wizard”), Elliott Associates, L.P., a Delaware limited partnership (“Elliott Associates”), and Elliott International, L.P., a Cayman Islands limited partnership (“Elliott International” and, together with Elliott Associates, the “Elliott Parties”). Capitalized terms used but not otherwise defined in this Agreement shall have the meanings ascribed to such terms under the Agreement and Plan of Merger, dated as of November 21, 2010 (the “Merger Agreement”), by and among Attachmate Corporation, a Washington corporation and a Subsidiary of Wizard (“Parent”), Longview Software Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent (“Merger Sub”), and Novell, Inc., a Delaware corporation (the “Company”).
If I'm reading it right, Elliott is contributing its Novell shares, valued at $72,500,000 and an additional $22,500,000 to Wizard for equity securities of Wizard. Elliott also invests to the tune of $15,000,000, as I'll show you in a second. The money and shares go to Wizard, not Attachmate.

Wizard is described as "a holding company and, other than the capital stock of its Subsidiaries, has no assets or operations and has no Liabilities other than those incidental to its ownership of its Subsidiaries or pursuant to the Original LLC Agreement" and "is classified as a partnership and not as an association taxable as a corporation for United States income tax purposes". So, what does Novell get out of that? Just that the deal happens, I guess. Here's the wording on that:

WHEREAS, in connection with the Merger, the Elliott Parties have delivered an Equity Commitment Letter (the “Elliott ECL”) to Wizard, pursuant to which the Elliott Parties are obligated, at or prior to the Contribution Closing (as hereinafter defined), to contribute shares of Company Common Stock to Wizard (the “Merger Contribution Company Stock”) having an aggregate value, based on the Merger Consideration (as the Merger Consideration may be increased by any amendment to the Merger Agreement or otherwise following the date of this Agreement), of $72,500,000 plus the amount, if any, by which the Contribution Obligation thereunder may be increased in respect of the Market Flex Requirement (as defined in the Elliott ECL) (the “Merger Contribution”);

WHEREAS, in addition to the Merger Contribution, pursuant to the Elliott ECL, the Elliott parties are obligated, at or prior to the Contribution Closing, to contribute shares of Company Common Stock (the “Additional Contribution Company Stock” and, together with the Merger Contribution Company Stock, the “Contributed Company Stock”) to Wizard having an aggregate value, based on the Merger Consideration (as the Merger Consideration may be increased by any amendment to the Merger Agreement or otherwise following the date of this Agreement), of $22,500,000 the (“Additional Contribution” and, together with the Merger Contribution, the “Contribution”),

WHEREAS, in consideration of the Elliott Parties’ willingness to deliver the Elliott ECL and effect the Contribution, Wizard desires to issue to the Elliott Parties the equity securities of Wizard described in Exhibit A hereto (the “Issued Equity Units”) in a transaction described in Section 721 of the Code, and to enter into an Amended Limited Liability Agreement of Wizard and/or other Qualifying Alternative Arrangements containing substantially the terms set forth on Exhibit A hereto (the “Amended LLC Agreement”) with the Elliott Parties and certain other equity holders of Wizard;

[The Exhibit E actually says $72,5000,000, but it's obviously a typo.] Wizard then has to pay Elliott its expenses, if the deal happens as contemplated:
11.Reimbursements. If the transactions contemplated by this Agreement are consummated, Wizard shall pay or cause to be paid, promptly upon delivery of any written request accompanied by appropriate supporting documentation, to Manchester Securities Corp., a New York corporation and a wholly owned Subsidiary of Elliott Associates (“Manchester”), or such other Person that Elliott Associates may designate in writing from time to time, an amount in cash equal to any out-of-pocket expenses incurred by the Elliott Parties and their respective Affiliates in connection with the acquisition of the Company and related arrangements among the Elliott Parties and Wizard and its Affiliates, up to an aggregate amount not to exceed $3,250,000.
So this is all way more complicated than we thought. I haven't got it all figured out yet, actually. I'm hoping Andy Updegrove puts down his fork and dives in to explain it all to us. But what's clear already is that Elliott has more than it had before, shares and investment shares, meaning more influence from those shares and the investment money. It has equity shares now, in Wizard, the parent of Attachmate, which will have a wholly owned subsidiary, Novell. So when Novell looks up, at the top it sees Wizard and Elliott looking back down at it.

The filing says this about a side letter about the money investment, in case it isn't complex enough already:

On November 21, 2010, Elliott and Elliott International also entered into a letter agreement (the “Side Letter”) with Francisco Partners, L.P., a Delaware limited partnership (“Francisco”), pursuant to which Elliott and Elliott International agreed, subject to the terms and conditions set forth in the Side Letter, to contribute to a newly formed Delaware limited liability company to be managed by Francisco (the “New LLC”) shares of Common Stock having an aggregate value, based on the Merger Consideration (as the Merger Consideration may be increased by any amendment to the Merger Agreement or otherwise following the date of the Side Letter) of $15,000,000 (the “LLC Contribution”). Immediately following the LLC Contribution, the New LLC will contribute the LLC Contributed Shares (as defined in the Side Letter) to Wizard Parent in exchange for equity securities of Wizard Parent.
Is that the end of "New LLC", mentioned in Exhibit G, or just the beginning of its life? I can't tell, but here's what the exhibit says:
The Elliott Parties and the Francisco Parties hereby agree that, concurrently with the Contribution Closing, the Elliott Parties shall, in addition to the amounts included in the Contribution, have the obligation to contribute, and shall have the right to contribute, to a newly formed Delaware limited liability company (the “New LLC”), shares of Company Common Stock (the “LLC Contributed Shares”) having an aggregate value, based on the Merger Consideration (as the Merger Consideration may be increased by any amendment to the Merger Agreement or otherwise following the date of this Agreement) of $15,000,000 (such contribution, the “LLC Contribution”). Immediately following the LLC Contribution, the New LLC shall, and Francisco shall cause the New LLC to, contribute the LLC Contributed Shares to Wizard in exchange for New Money Units having an aggregate liquidation preference of $15,000,000.

Effective as of the LLC Contribution, (i) Francisco shall be the Managing Member of the New LLC and shall have all rights to govern the New LLC (provided that the operating agreement of the New LLC shall provide such customary protections as are necessary to replicate, from an economic perspective, the direct ownership of New Money Units by the Elliott Parties, including (A) the New LLC shall not conduct any business or enter into any transaction other than matters incidental to its ownership of the New Money Units issued in respect of the LLC Contributed Shares and (B) such New Money Units shall be treated in a similar and proportionate manner as all other New Money Units held by the Francisco Parties (including with respect to voting and disposition thereof)), and (ii) the Elliott Parties shall be the Economic Members of the New LLC and shall have all rights to the economic interests of the New LLC (including distributions made to the New LLC in respect of New Money Units). Prior to the LLC Contribution, Francisco and the Elliott Parties shall negotiate and prepare the limited liability agreement (or an amendment thereto) of the New LLC in good faith to reflect the terms of this Agreement."

So the other money people show up here. But why? Why not just invest in Wizard? Or just buy Novell outright? I haven't figured that out yet, unless it's just that Elliott wasn't willing to give Novell the full price and others stepped in to help make it happen.

The voting agreement, Exhibit H, is between Attachmate, not Wizard, and Longview and Novell. Wizard does no business. It's a holding company.

I don't see the advantage to anybody. But you know me. Wall Street and I reside in separate quarters. No fraternization whatsoever. Some of you will be able to figure it out, though, so I'm showing it to you, even though I haven't yet got the business plan clear myself. Elliott's Dickensian reputation precedes it, of course, so we know what they usually do.

I note Item 6 of in this August Elliott filing talks about derivative agreements:

ITEM 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.

Elliott (through Liverpool) and Elliott International have entered into notional principal amount derivative agreements (the “Derivative Agreements”) with respect to 2,087,558 and 3,131,338 shares of Common Stock of the Issuer, respectively (representing an economic interest in 0.6% and 0.9% of the shares of Common Stock of the Issuer, respectively). The Derivative Agreements provide Elliott and Elliott International with economic results that are comparable to the economic results of ownership but do not provide them with the power to vote or direct the voting or dispose of or direct the disposition of the shares that are the subject of the Derivative Agreements. The counterparties to the Derivative Agreements are unaffiliated third party financial institutions.

Except as described above in Item 4 and in this Item 6, none of the Reporting Persons has any contracts, arrangements, understandings or relationships with respect to the securities of the Issuer.

So Elliott can't vote these shares, but they get paid. Who are the counterparties? Just the earlier named equity entities like Francisco Partners, or could it be others too?

And should we worry that 60% or so of the investment is from a Cayman Islands entity?

: )

If I figure this out any better than this, I'll swing back by, but in the meantime, you can take a look too.

Update: Matt Asay answers one question we've had, whether the 882 patents are all or just some of Novell's patent portfolio. And the answer is, only part. Novell has 2,000 or so. But the rest of Asay's article is depressing indeed:

Attachmate has told SUSE's development community not to worry, that life will be much the same as before. This isn't very reassuring. Attachmate has zero credibility in the open-source world. Name a single open-source project that Attachmate contributes to in a meaningful way. A search for "Attachmate open source" yields nothing. Well, it does reveal this little piece of anti-open source FUD in Attachmate's FAQ for its FIPS 140-1 product:
FIPS 140 validation provides third-party confirmation that a security software implementation meets the highest possible standards. This validation sets Reflection for Secure IT apart from competitive software, such as open source software, which is not validated.
Welcome home, OpenSUSE developers!

This is the final end of Novell, a company that consistently squandered its opportunities to regain relevance, slouches its way into Attachmate, while potentially poisoning the Linux industry through the sale of its patents to Microsoft/CPTN Holdings. While this IP doesn't include the Unix copyrights, it does include 882 of Novell's roughly 2,000 patents which almost certainly involve IP surrounding WordPerfect and other technologies that give Microsoft more cause for sabre-rattling against open-source projects like OpenOffice.

So, he thinks it's about WordPerfect. That's reassuring on the one hand, and nauseating on the other. But while I suppose it's possibly for offensive patent use, I think it's more likely for defensive purposes, to make sure no one else got those patents.

The most interesting part of the article to me was what he says about Chris Stone, and he confirms my impression from the trial testimony that he is an impressive guy and they should have kept him:

It didn't help that Novell lost key executives like former vice-chairman Chris Stone (to pursue "other" opportunities) and Ledbetter (joined Pelion Venture Partners), replacing them with professional managers like Ron Hovsepian. I admire Hovsepian for his operational expertise, but he was never the sort of dynamic visionary that Stone was - the sort of leader Novell needed in order for the company to become relevant. I really like Hovsepian as a person and think he's an efficient manager. But he was unlikely to be the one to brainstorm Novell's way out of its slump.
The slump was the legacy stuff, by the way, not SUSE Linux. But if Attachmate isn't into FOSS and has no experience, I'm thinking they may think they can spiff it up and sell it on to someone else in a fairly short time frame. If so, that might work out eventually.

And yet another shareholder lawsuit, according to BusinessWeek:

The proposed sale doesn’t treat all shareholders equally, investor Lawrence Fisk said in his complaint, filed in Delaware Chancery Court in Wilmington on Nov. 23, the day after the Attachmate offer was announced. Hedge-fund manager Elliott Associates LP, which failed to take Novell private in March, would get 7 percent of the merged company for its 7 percent stake in Novell.

Those, and other terms, “are fundamentally unfair to plaintiff and the other shareholders of the company,” Fisk said.

Update 2: And here's the previously filed Exhibit B, the letter to Novell from Elliott filed in March. And here's Novell's CEO's memo to employees.

Update 3: I stumbled across this 2005 article about Attachmate while looking for something else, so I thought I'd share it with you:

With financial backing from a consortium of blue-chip private equity investors, the combined entity, called AttachmateWRQ, will move forward with one of its first initiatives being to grow even more. The company will begin looking in earnest to find additional acquisition targets in the fragmented terminal-emulation software market.

Terminal-emulation software helps connect mainframe computers and Web-based servers with PC networks.

Next to IBM Corp., AttachmateWRQ is one of the biggest players in the market, which AttachmateWRQ's backers -- Thoma Cressey Equity Partners, Golden Gate Partners and Francisco Partners -- think is ripe for consolidation.

And here's how Attachmate describes itself in a recent press release about a deal with the IT division of the Emirates Group:
Attachmate delivers advanced software for terminal emulation, legacy modernization, managed file transfer and enterprise fraud management. With our technologies, more than 65,000 businesses worldwide are putting their IT assets to work in new and meaningful ways.
And the Salt Lake Tribune has the Utah perspective:
Attachmate Corp. CEO Jeff Hawn said Monday he likely will be visiting the Provo office of Novell next week as part of planned acquisition of the company that got its start in Utah. But Hawn said plans for the Utah office haven’t been formulated, and he could not yet say what the $2.2 billion deal will mean for the Provo office. That facility is Novell’s biggest with about 1,380 employees....

"Management had struggled over the last few years to grow the new businesses and that created an opportunity, given all of the cash from the balance sheet for financial bidders," said Rich Williams, an analyst at Cross Research in Livingston, N.J., who rates Novell shares "hold" and doesn’t own any. "The financially oriented buyers are going to hold the company, reshape it to a degree and then in a few years, in a more attractive environment, bring the company public."

Here's the Francisco Partners page on Attachmate, and I can't help but notice that they also invest in Barracuda Networks, which is an OIN licensee since 2007. Here are all the lawyers who worked on the deal. All the players but Elliott had antitrust attorneys on their team.

And if you are curious as to what the Forrester folks think it all means, here's where they blog. I gather they mostly think SUSE will continue but eventually be sold on to some other party, like IBM or HP or even Oracle or SAP.

Update 4: Andy Updegrove has an interesting followup regarding the deal, specifically on whether we will ever find out who are the members of the patent consortium Microsoft put together, and the short answer is probably never:

The first and most obvious question relates to who the other members of CPTN Holdings, LLC (CPTN) the Microsoft syndicate may be. To my knowledge, there has not yet been a leak of this information. As I noted in my previous blog entry, the transaction documents that are made public pursuant to public reporting obligations may never reveal the names, unless one of the consortium members is required to disclose it in one of its own public reporting documents. Presumably that will happen, if it will happen at all, within three to four months, as part of a normal quarterly filing on Form 10-Q.

The second, and far less likely way would be as an indirect result of a filing by CPTN or Attachmate under the Hart-Scott-Rodino Public Improvements Act of 1976 (HSR). Whether or not a filing is required involves a complex analysis of the facts, as summarized in a 20 page Introductory Guide available at the Web site of the Federal Trade Commission (FTC), the agency which receives HSR filings and determines whether or not to permit a transaction described in an HSR filing to proceed.

If the patent acquisition were to be made by Microsoft alone, an HSR filing would clearly be necessary. Whether an acquisition by a consortium with the specific membership of CPTN would be required is a more complex question....

In my last blog entry, I had said that I assumed, but had not had time to look up, whether HSR filings are public; I’ve now had time to take a look, and neither the fact that an HSR filing has been made, nor the text of the filing itself, becomes public. In fact, filings are even exempt from disclosure under the Freedom of Information Act.

Still, as implied, the fact that it hasn't leaked yet doesn't mean it won't ever. People are people, and these things in my experience do leak eventually, even if you don't read about it in the funny papers.

  


The Elliott Associates $$ Agreements Behind the Novell-Attachmate Merger - Updated 4Xs | 336 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections here
Authored by: JamesK on Friday, November 26 2010 @ 09:38 PM EST
Not that PJ makes any mistakes.

---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

News Picks
Authored by: JamesK on Friday, November 26 2010 @ 09:39 PM EST
Please refer to the articles.


---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

Off Topic
Authored by: JamesK on Friday, November 26 2010 @ 09:40 PM EST
Anyone caught posting on topic will be forced to watch 100 hours of Lawrence
Welk.


---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

Comes goes here
Authored by: JamesK on Friday, November 26 2010 @ 09:41 PM EST
Or is it the other way around?

---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

N/T here
Authored by: JamesK on Friday, November 26 2010 @ 09:42 PM EST
This area reserved for those who can't be bothered adding comments to their
posts.


---
IANALAIDPOOTV

(I am not a lawyer and I don't play one on TV)

[ Reply to This | # ]

cayman - sco
Authored by: designerfx on Friday, November 26 2010 @ 10:11 PM EST
wasn't there a cayman based SCO entity, if my memory serves
correctly?

[ Reply to This | # ]

Putting Down the Fork
Authored by: Anonymous on Friday, November 26 2010 @ 10:49 PM EST
PJ, I probably won't blog on this, at least for a while, because I'd just for
the most part be guessing rather than be able to provide much enlightenment.
Yes, I could add some detail about how the pieces fit together and what the
pieces are, but the bottom line is that there's not enough information there to
really do more than speculate on why the deal has been structured exactly as it
has been.

One thing I can note, though, is that transaction structures often get to be
very complicated purely for tax reasons, or because different groups of players
are putting in different amounts or assets, and are getting different
percentages of profit, possible in different priorities as a result, and need a
structure that makes that happen. Something that could have been done in one
step between two entities will therefore often be set up among multiple entities
for reasons that are primarily of concern only to the participants, and not for
any other reason.

That said, this is very complicated. Usually, if the buyer is an operating
company, it would buy the target with cash or stock. In the former case, it
would as often as not borrow a good chunk of it from a syndicate of banks, or,
if it had a "shelf offering" already registered, with cash from a
stock sale.

If the buyer was a private equity fund, it would put up as little cash as
possible, and then come up with the rest in layers: possibly equity from
additional investors, "subordinated debt" from one bank (or a group of
banks), and "senior debt" from another bank (or group of banks). If
things fall apart, the senior lender gets paid first, then the subordinated
lenders, then the trade creditors.

As you can see, there's quite a bit more going on here. What's hard to tell is
whether Elliott/Attachmate just had trouble getting the whole financial package
together (or wanted to hedge their bets more), or whether there's something else
that's driving the complexity as well. Perhaps time will tell - or perhaps not,
since everyone except Novell is a public company (at least till Q1).

Best,

Andy

[ Reply to This | # ]

My dog's name is Eliot
Authored by: kawabago on Friday, November 26 2010 @ 11:42 PM EST
But so far he isn't cracking under intense petting. It sure sounds like a pool
of money doesn't want to have a name attached to it. I just hope the buyer's
aren't directly related to the denizens of Hell.

[ Reply to This | # ]

Are we sure this isn't about Unix copyrights?
Authored by: Anonymous on Saturday, November 27 2010 @ 01:33 AM EST
Given the amount of money spent by all parties in the SCO litigation thus far,
this acquisition seems relatively cheap.

[ Reply to This | # ]

The Elliott Associates $$ Agreements Behind the Novell-Attachmate Merger
Authored by: wvhillbilly on Saturday, November 27 2010 @ 01:56 AM EST
I smell a very big rat in this woodpile, and it's full of termites too.

---
"It is written." always trumps, "Um, ah, well, I thought..."

[ Reply to This | # ]

The Elliott Associates $$ Agreements Behind the Novell-Attachmate Merger
Authored by: Anonymous on Saturday, November 27 2010 @ 07:50 AM EST
Just an idea ...

Is all this maneuvering with holding companies and consortia ensuring that if
Novell's 882 patents are used to sue somebody in a troll-esque fashion that no
company could be counter-sued?

[ Reply to This | # ]

Cayman Islands
Authored by: kh on Saturday, November 27 2010 @ 08:19 AM EST
So I assume that the Cayman Islands have legislation that means that the true ownership of the company is hidden.

Apparently yes:

DISCLOSURE OF BENEFICIAL OWNERSHIP TO AUTHORITIES

No requirement.

[ Reply to This | # ]

On the 882 Patents
Authored by: Anonymous on Saturday, November 27 2010 @ 09:57 AM EST
Ia a previous life, my company did a patent-sharing agreement with a competitor,
so as to be able to continue a particular product. The deal required us to sell
each other those patents if either of us went out of busines.

This was specifically in order that we would continue to be able to block a
third competitor from entering the business.

If that's what's happening here, MS gets the patents that Novell was using to
protect some part of its business, and now can use them to start blocking third
parties.

It's therefor in our interest to discover what the patents were, so we can
prepare ourselves to fight the next outbreak of FUD.

--dave

[ Reply to This | # ]

Attachmate and FOSS
Authored by: celtic_hackr on Saturday, November 27 2010 @ 10:23 AM EST
One other possibility with Attachmate is this would be an easy way for them to
get a major jump-start into the FOSS world and market.

Yes, I said FOSS market. Let's face it there's a lot of money in Open source
these days. It's become big business. many companies have lost out on this by
not getting into it. Some companies can buy into it.

It could be as simple as that. I know. I know. Where did all this optimism from
this perpetual grouch (me) come from? Well, I wasn't always so disenfranchised.
I used to be an idealist. I guess, there's still some strands left.

Anyway, it's possible. It's a very strange deal, and lot's of shell companies to
hide the pea under. There's lot's of benefits in Cayman Island companies.
Especially if you're an American doing business with people in America. Not all
of those reasons are nefarious, just a result of some ridiculous US laws.

Still there is much that still needs revealing. Who is this Singer guy? That is
the $64,000 question.

[ Reply to This | # ]

Wordperfect patents are probably not relevant
Authored by: Anonymous on Saturday, November 27 2010 @ 04:06 PM EST

Wordperfect was the leading word processor up to about 1994. Patents issued before 1995 have a maximum period of validity of 20 years from the date of filing or 17 years from the date of grant. Any patents issued when Wordperfect was successful have either expired already, or will expire very soon.

Conclusion: we can pretty much forget about Wordperfect patents now. There may be some dangerous patents in this deal, but Wordperfect patents are not among them.

[ Reply to This | # ]

Wasn't Novell a member of OIN?
Authored by: Anonymous on Saturday, November 27 2010 @ 04:58 PM EST
Are these patents that were pledged to OIN?
If these have been pledged to OIN does the pledge still hold after the sale?

[ Reply to This | # ]

The Elliott Associates $$ Agreements Behind the Novell-Attachmate Merger
Authored by: PolR on Saturday, November 27 2010 @ 06:19 PM EST
From what I understand of the of the financial aspect of the deal, it is
profitable for Elliott as it stands because they got a very good price for
Novell's assets considering Novell's cash and the sale of the patents. This
means there is no need to assume any further FOSS hostile motivation to explain
what we see.

Of course there should be some undisclosed motive behind all this complexity but
the visible profit is such that there is no need to assume anything FOSS related
to explain what we see.

[ Reply to This | # ]

What Attachmate might want from Novell
Authored by: Anonymous on Saturday, November 27 2010 @ 08:15 PM EST
Other than guessing at troll motives, here is what
Attachmate could get from owning Novell, UNIX and SUSE, of
they don't botch it:

1. Adding Novell Netware server classic (4.x and older) to
its portfolio of supported legacy systems.

2. Adding the many native clients for various operating
systems to its toolbox of glue software for legacy systems.

3. Adding Novell's Netware-independent NDS directory,
management and single sign on products to its offerings of
software for interworking between modern and legacy systems.

4. Adding deep UNIX support to its offerings of support for
other legacy platforms.

5. Using the ultimate UNIX source license (actual copyright
ownership) to assist them in implementing and improving UNIX
support in its existing cross platform products.

6. Adding SUSE for IBM system 360/370/3090/z (worlds longest
running binary compatible platform) to its existing products
for that platform. This one was actually mentioned in the
past week.

7. Extending its support for other legacy operating systems
to cover the modern and still growing Linux platform. In
other words, expect future announcements of Linux versions
of the products they are currently offering for legacy
platforms.

8. Plus profit any profit-making activities already in
Novell - Obviously

Note that legally, Attachmate will probably keep Novells
legal structure around as a means of protecting themselves
from trolls, forgotten debts, random lawsuits etc. related
to Novell's varied past. The important thing is what they
do in the real world regarding developers, offices, products
etc.

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It looks like Elliott is only putting up some of their shares
Authored by: Anonymous on Saturday, November 27 2010 @ 08:46 PM EST
If I'm reading it right, Elliott is contributing its Novell shares, valued at $72,500,000
I think it means, as many shares as it takes to equal $72,500,000 at $6.10 per share (assuming the price doesn't change). (From the Merger Agreement filed with the 8-K: "“Merger Consideration” means $6.10, in cash," but that, in theory, could be renegotiated to a higher number.) Doing the math, that would be 12,000,000 shares, leaving them with 13,000,000 shares that they will sell for $6.10, letting them pocket $78,000,000. Of course, they had to put up $22,500,000 in cash in addition to the shares worth $72,500,000 to get whatever the "Issued Equity Units" are.

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The Elliott Associates $$ Agreements Behind the Novell-Attachmate Merger
Authored by: KARife on Sunday, November 28 2010 @ 01:07 AM EST
There are two structural points here that indicate what is happening: Cayman
Islands and beneficial ownership. These in turn indicate two principal goals:
tax avoidance and disclosure avoidance, notably the latter. Note that Elliott
is reporting Rule 13d-3 beneficial ownership, not outright ownership, so
apparently it has entered into a series of voting agreements with parties
unknown to assemble a control bloc. One assumes that all this layering,
including the offshore elements, is to protect the identities of the legal
owners.

As for Singer, he's been playing this game over 30 years. He's a major Neocon
player, and his game is all about money and power. He has only three, potential
uses for SUSE: 1) monetize it, 2) pull it out of the game for the benefit of
another project/client, or 3) use it as a weapon against competitors of another
project/client. Bets?

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Wayland license clarification
Authored by: SilverWave on Sunday, November 28 2010 @ 10:02 AM EST
http://lists.freedesktop.org/archives/wayland-devel/2010-November/000249.html

Quote:

Kristian Høgsberg krh at bitplanet.net
Mon Nov 22 13:12:53 PST 2010

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Hi,

I wanted to clear up the wayland licensing a bit before I apply more
patches. The main "output" of the wayland git repo is the two
libraries: libwayland-server and libwayland-client. Right now those
libraries are under the MIT license, but I'm going to move them to be
LGPLv2. The purpose of these libraries are to provide a C API for the
wayland protocol. libwayland-client will typically be a dependency of
toolkits such as Qt, GTK+ or clutter, or perhaps used directly by
wine, qemu or rdesktop type of applications. Moving libwayland-client
to LGPLv2 shouldn't be a problem for these cases, indeed those
toolkits are all already LGPLv2. The most notable change will be that
you can't fix a bunch of bugs in the library and keep them to
yourself. libwayland-server will be a dependency of any compositor,
but as for the client side library, this shouldn't have any
consequences on how you can use it, only on how you contribute to it.
I'm aware of the uncertainty about static linking and LGPLv2, but just
don't link statically.

The demo compositor and clients are currently under GPLv2, but I'm
changing them to LGPLv2 as well. This is a bit odd on the face of it,
but the point of these applications is to prototype new functionality
that will eventually migrate into either the client or server wayland
libraries or one of the above toolkits. As we move forward and start
adding developers, I just want to make sure that that won't be a
problem.

Obivously, I am not a lawyer and the above is only an informal
discussion of the differences between MIT and LGPLv2, meant to
describe the motivation behind the specific license choices. The
license text is always the last word.

If I've applied patches from anybody opposed to this license change,
please let me know and I'll back them out.

Thanks,
Kristian


---
RMS: The 4 Freedoms
0 run the program for any purpose
1 study the source code and change it
2 make copies and distribute them
3 publish modified versions

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Attachmate's Press Release on openSUSE
Authored by: Anonymous on Sunday, November 28 2010 @ 12:04 PM EST
FWIW, Attachmate Corporation Statement on openSUSE project:
November 22, 2010

In conjunction with the announcement today on the signing of a definitive agreement to acquire, upon closing, Novell, Inc. (NASDAQ: NOVL), Attachmate Corporation released the following statement:

"The openSUSE project is an important part of the SUSE business,” commented Jeff Hawn, chairman and CEO of Attachmate Corporation. “As noted in the agreement announced today, Attachmate plans to operate SUSE as a stand-alone business unit after the transaction closes. If this transaction closes, then after closing, Attachmate Corporation anticipates no change to the relationship between the SUSE business and the openSUSE project as a result of this transaction.”

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Microsoft is the only member of CPTN?
Authored by: Anonymous on Monday, November 29 2010 @ 11:55 AM EST
As is customary with Microsoft, the "consortium" is likely to be a
lie. Or, at best, Microsoft-affilated patent trolls like Acacia.

So, sorry PJ, I doubt the list of the consortium's members will ever be known,
perhaps because there aren't any others.

Maybe Lenin was right. The U.S. is selling the rope it will be hanged with.

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Dec 1 hearing cancelled
Authored by: Anonymous on Monday, November 29 2010 @ 03:48 PM EST
next hearing is scheduled for January 18, 2011 at 10:00 a.m.

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The "Voting Agreement" Exhibit G
Authored by: Anonymous on Tuesday, November 30 2010 @ 07:26 PM EST
Asking for input re: the following:
"On November 21, 2010, Elliott and Elliott International also entered into a Voting Agreement (the “Voting Agreement”) with Parent and Merger Sub, pursuant to which each agreed, among other things, to vote shares of Common Stock held by them in favor of the Merger and against any proposal made in opposition to or competition with the Merger. Elliott and Elliott International also agreed that, during the period beginning on November 21, 2010 and terminating on the Expiration Date (as defined in the Voting Agreement), they will not (i) transfer, assign, sell, gift-over, pledge or otherwise dispose of, or consent to any of the foregoing, any or all of the Subject Shares (as defined in the Voting Agreement) or any right or interest therein (“Transfer”); (ii) enter into any contract, option or other agreement, arrangement or understanding with respect to any Transfer; (iii) grant any proxy, power-of-attorney or other authorization or consent with respect to any of the Subject Shares (other than the proxy contemplated in Section 3 of the Voting Agreement); or (iv) deposit any of the Subject Shares into a voting trust, or enter into a voting agreement or arrangement with respect to any of the Subject Shares; provided, however, that Elliott and Elliott International (and any permitted transferee under the Voting Agreement) may Transfer any or all of the Subject Shares to any Affiliate of Elliott and Elliott International if such Affiliate provides Parent and Merger Sub with a written agreement to be bound by the terms of the Voting Agreement and to hold such Subject Shares subject to all terms of the Voting Agreement, in each case, as if it were Elliott and Elliott International".

Block voting comittments; the weight of an average 10 - 15 cent gain from institutional short-term investments (182,000,000 shares traded 11/22/10 - astounding); in order to force the deal through?

Also curious to note in the above is:

"that Elliott and Elliott International (and any permitted transferee under the Voting Agreement) may Transfer any or all of the Subject Shares to any Affiliate of Elliott and Elliott International if such Affiliate provides Parent and Merger Sub with a written agreement to be bound by the terms of the Voting Agreement and to hold such Subject Shares subject to all terms of the Voting Agreement, in each case, as if it were Elliott and Elliott International."

Who could possibly know who an "Affiliate" is? Don't see a definition of "Affiliate" listed in this SEC document (correct me if I missed this). If "Affiliate" is not defined, then this leaves the door wide open for a transfer of voting shares to just about anyone - signaling this was to be a structured and locked deal from the get-go IMHO.

Notice too, that NOVL shares have not traded up to the asking price of $6.10 per share since the deal was announced. Institutional/private concerned investors who swooped in on 11/22/10 can now guarantee their 10 - 15 cent appreciation on their mega share investment in 2 ways: the deal closes as expected; or if need be, be deemed to be affiliated with Elliott (i.e. done business with them at some time, at some capacity, no matter how small or unrelated), and as such convey their voting authority to Elliott.

Elliott started this back in March, but my gut says it had silent partners that were willing to put some dead money aside for a year (the cosmetic time it would take to not cause suspicion) in order to back-finance the deal.

Dunno. As PJ inferred - there is a lot more to this than what is evident now. But it sure doesn't pass the smell test.

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