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SCO Comments on Insider Trading |
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Thursday, August 14 2003 @ 12:18 PM EDT
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They have a press release here: The SCO Group Comments on Insider Transactions
LINDON, Utah, Aug 14, 2003 -- The SCO Group, Inc. (Nasdaq: SCOX) encourages its directors and executive officers to sell the stock held by them through plans designed to qualify for the protections provided by Rule 10b5-1 under the Securities Exchange Act of 1934.
The 10b5-1 plans provide for future sales of stock, at predetermined times and in amounts and under conditions specified in the plans, without subsequent instructions from the participants. These plans have been adopted by the following individuals: Robert Bench, CFO; Jeff Hunsaker, Sr. VP Marketing; Reg Broughton, Sr. VP International Sales; and Michael Olson, VP Finance/Controller. These plans have been implemented primarily for the purpose of providing liquidity to the participants to meet sizable personal tax liabilities resulting from the vesting of restricted stock awards.
During the three months ended July 31, 2003, individuals selling under approved 10b5-1 plans sold 88,000 shares of the Company's common stock. Two other executive officers sold 29,616 shares during the same three-month period in Company approved open trading windows. For the upcoming three-month period to end on October 31, 2003, the above-referenced executive officers may sell up to 141,000 shares of the Company's common stock under current 10b5-1 plans if the conditions of the various plans are met. No other directors or executive officers have implemented a 10b5-1 trading plan to sell shares of the Company's stock during the next three months.
Our directors and executive officers beneficially hold approximately 6,005,000 shares and options to acquire an additional 2,016,000 shares.
Their third-quarter financial results press release:For the third quarter of fiscal 2003 ended July 31, The SCO Group, Inc. (Nasdaq: SCOX) reported net income of $3.1 million, or $0.19 per diluted share, on revenue of $20.1 million, compared to a net loss of $4.5 million, or $0.35 per diluted share, on revenue of $15.4 million for the comparable quarter of the prior year. Revenue for the third quarter of fiscal 2003 from the Company's operating system platforms was $12.8 million, and revenue from its SCOsource licensing initiative was $7.3 million, both within the range of previous guidance. For the first nine months of fiscal 2003, the Company reported net income of $6.9 million, or $0.47 per diluted share, on revenue of $55.0 million, compared to a net loss of $22.1 million, or $1.58 per diluted share, on revenue of $48.8 million for the comparable nine-month period of fiscal 2002. The Company's current fiscal year ends October 31, 2003. "During the quarter ended July 31, 2003, SCOsource, our division for licensing and protecting the Company's UNIX(R) intellectual property, generated $7.3 million in revenue and contributed $5.6 million to gross margin. Our SCOsource initiative continues to gain momentum as we pursue enforcement of the Company's intellectual property rights," said Darl McBride, president and CEO. McBride continued, "This is our second consecutive quarter with net income and positive cash generated from operations. These results have strengthened our balance sheet and overall financial position. We intend to use this capital to continue our intellectual property protection and licensing initiative as well as for launching SCOx, our Web services strategy." "We expect that revenue for our fourth quarter, ending October 31, 2003, will be in the range of $22 to 25 million. The magnitude of our SCOsource licensing opportunities and our confidence in the SCOsource revenue pipeline is growing each quarter, said McBride.
Conference Call
As previously announced, the Company will host a conference call at 9 a.m. MDT today, August 14, 2003, to discuss third-quarter fiscal 2003 results. To participate in the teleconference, please call 800-811-0667 or 913-981-4901, code: 452322, approximately five minutes prior to the time stated above. You may also join the call in listen-only mode via Web cast at http://ir.sco.com/medialist.cfm. There will be a subsequent replay of the teleconference available on the SCO IR Web site 48 hours after the conference call.
Forward Looking Statements
The statements set forth above include forward-looking statements that involve risks and uncertainties. The Company wishes to advise readers that a number of important factors could cause actual results to differ materially from those projected in the forward-looking statements. The Company has only realized revenue from its SCOsource licensing initiative during the last two quarters and the intellectual property rights that it is asserting in seeking to enter into licensing agreements are subject to pending litigation, making it difficult to predict the extent of future revenues from this source. Other factors that may affect the forward looking statements include the ability of the Company to successfully roll out its new services and solutions to service providers in its existing channels; the acceptance of such offerings by existing service providers and customers; the ability of the Company to successfully meet its revenue projections, which are based on the ability of the Company to enter into new licensing agreements and the continued acceptance in the marketplace of historical products; the Company's ability to compete effectively with other solutions providers; new and changing technologies and customer acceptance of those technologies; and claims of infringement of third-party intellectual property rights. These and other factors, which could cause actual results to differ materially, are discussed in more detail in the Company's filings with the Securities and Exchange Commission.
Their webcast requires either RealPlayer or Windows Media Player. I don't use either. Evidently GNU/Linux and Apple folks are not invited.
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Authored by: Anonymous on Thursday, August 14 2003 @ 09:41 AM EDT |
There is a Linux version of RealPlayer ;) tamarian[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 10:09 AM EDT |
"Our SCOsource initiative continues to gain momentum..."
Right down the hill. Nick[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 10:12 AM EDT |
Hmm ...
The objective of the 10b5-1 provision is, clearly, to allow corporate insiders
to sell stock in a kind of "hands off" fashion, and there is clearly a
legitimate need for this kind of provision. (Insiders need to buy groceries and
pay the rent, too.)
I guess it's just a funny coincidence that these plans happened to get started
right after the lawsuit was announced. Right. Rich Gibbs[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 10:25 AM EDT |
They have been anything but hands off. Infact they seem to sprout new hands and
faces daily and want to put thier fingers in everyones pies. Supa[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 11:27 AM EDT |
Since the IBM use of Darl's words in interviews, press conferences and PR Darl
seems to have been a LOT quieter.
Did anyone note a less belligerent, fewer in-your-face-claims during this
conference call? Sanjeev[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 11:28 AM EDT |
PFFFFfffft... trying again
Did anyone note a less belligerent TONE, fewer in-your-face-claims during this
conference call? Sanjeev[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 02:40 PM EDT |
He turned his verbal guns on the Wall Street Journal guy.
Yes Darl, that will encourage him not to write any more articles ridiculing your
claims. quatermass[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 03:31 PM EDT |
Does the figure of 6M shares sound right to everyone else. http://finance.yahoo.com/q?s=SCOX&d
=b quotes a market cap of $137M and price per share at close of $10.55 which
by my calculation makes 13M shares in issue. That would mean nearly half the
company is owned by the directors. I have a suspicion that they are including
Canopy's chunk in this figure, as I thought Canopy owned nearly 50% and
otherwise there would be virtually no shares held outside Canopy and the
directors.
Also worth Noting that Micheal Olsen sold another 5000 shares on Monday
according to http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001
102542&owner=include but these haven't yet shown up on Yahoo. According to
PJs analysis Darl only holds 15,003 shares, 7,003 of which he only got a month
ago so no huge surprise that he hasn't sold them. Adam Baker[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 03:56 PM EDT |
And now I see the figures in their last annual report, year ended Oct 2002 (http://www.sec.gov/Archives/edgar/data/1102542/000104746903007344/a2
104670z10-ka.htm)
5.3M of those shares are held by Canopy group and justify inclusion because the
Canopy directors are also directors of SCO. Darl held no shares at that
time.
I thought the Register's reporting was rather nice, they regurgitated the PR
with minor scepticism and then in the last paragraph gave this link as a "Must
Read" http://www.computerworld.com/managementtopics/management/story/0,108
01,83452,00.html Adam Baker[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 05:08 PM EDT |
As much as I hate SCO (I'm currently starting a small business that's entirely
based on Linux) I've got to say that the whole "insider trading" thing doesn't
impress me too much. I certainly keep an eye on it, because it could get ugly,
but so far they've sold less than one percent of the market cap of the company,
and those who've sold the most shares also have the most shares left - Michael
Olsen still has more than fifty thousand shares. Broughton still has one
hundred and twenty thousand. Bench has more than two hundred thousand.
I can't blame them for selling some of their holdings when the share price went
up tenfold. I'd probably have sold something at that point too. Alex
Roston[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 05:16 PM EDT |
"For the third quarter of fiscal 2003 ended July 31, The SCO Group, Inc.
(Nasdaq: SCOX) reported net income of $3.1 million, or $0.19 per diluted share,
on revenue of $20.1 million, compared to a net loss of $4.5 million, or $0.35
per diluted share, on revenue of $15.4 million for the comparable quarter of the
prior year."
I read somewhere (I forget where now) that Microsoft paid $20M for their Unix
license. Isn't it funny how SCO is reporting a gross revenue of $20.1M? I guess
the other $100K was from the one company to purchase their Linux License. J.F.[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 06:21 PM EDT |
Got to looking at the earnings picture and the ownership picture, specifically
at the Canopy Group
web site. I note that one of the Canopy Group's companies is Linux Networx, a
company that
sells clustered Linux systems. I wonder if SCO will hit them up for Linux
licenses... Steve Martin[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 07:23 PM EDT |
The thing about insider trading is, usually it involves people *buying* stock
just before it goes up, or *selling* it just before it goes down. Selling a
whole bunch of stock after your company's stock price goes through the roof is
just called "cashing in". If they'd suddenly given a whole bunch of shares to
themselves just before the IBM announcement that would be another story. If
anything, those scheduled sale thingies provide a glimpse to the market of what
might might be cooking at a company.
What happens when SCO starts sliding down the other end of their rainbow will be
another story. And, of course, the Canopy umbrella itself covers a host of
interesting public and non-traded companies, all mixed together in a very
entertaining way. raindog[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 09:05 PM EDT |
"those who've sold the most shares also have the most shares left"
I must admit I really dont know much about stocks but isnt the above statement
somewhat misleading? I mean lets take for example I own 50 million shares of
Bre-X which is valued at 0.01 a share. I make a claim that a new 'huge' diamond
deposit really has been found (and I make people sign a NDA so they cant
independently verify the claim). The stock investors believe me and pump the
stock to $10 a share. I then sell 1 million shares of my stock giving me a quick
$10,000,000. Isnt it a smoke screen to claim "Hey, I still have 49,000,000
shares left" ?????? JohnC[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 09:20 PM EDT |
JohnC,
That's a question for the SEC to answer, when they are picking
through the rubble of SCOG after they have imploded... D.[ Reply to This | # ]
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Authored by: Anonymous on Thursday, August 14 2003 @ 09:55 PM EDT |
If SCO execs were making anywhere near that 10,000,000 dollars, I'd agree with
you, but a look at PJ's listing shows that most of them have made no more than a
couple hundred thousand. Most have made less than that.
In other words, it's not real money.
That being said, don't misunderstand me. If McBride & Co. go to the big house on
a securities fraud conviction, I'll still have a party, but I just don't think
it's gonna happen.
Alex Alex Roston[ Reply to This | # ]
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Authored by: Anonymous on Friday, August 15 2003 @ 07:05 AM EDT |
> In other words, it's not real money.
Well it is real money compared to most of their salaries.
Canopy/Vultus/Wall could also be real money.
There also seems to be some confusion over the issues.
Look at the allegations about Martha, which as I understand it are:-
1. She is alleged to have traded stock on undisclosed information about ImClone.
i.e. classical illegal "insider trading"
2. She is alleged to have manipulated the stock price in her own company, by
giving false information to shareholders
If you look at what IBM and Red Hat allege, then decide which of these it's
closer to. quatermass[ Reply to This | # ]
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Authored by: Anonymous on Friday, August 15 2003 @ 07:06 AM EDT |
"If you look at what IBM and Red Hat allege, then decide which of these it's
closer to."
should be
If you look at what IBM and Red Hat allege, then decide which of these
scenarios, their allegations are closer to. quatermass[ Reply to This | # ]
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