01/24/2011 - 1216 - Notice of Service // Notice of Filing of (I) Executed Asset Purchase Agreement and (II) Proposed Sale Order in Connection Therewith (related document(s) 1141 ) Filed by Edward N. Cahn, Chapter 11 Trustee for The SCO Group, Inc., et al.. (Attachments: # 1 Exhibit 1) (Tarr, Stanley) (Entered: 01/24/2011)

Here, the Debtors offered no evidence of the fairness of the price and, indeed, the price is highly suspect as the sale was clearly a rushed, last ditch effort to avoid the Conversion Motions. There is no evidence that the sale price is fair because it is just enough for Debtors to dismiss their cases.

The terms are equally, if not more, troublesome. Debtors are retaining the Mobility business that is virtually worthless, the letter of credit to pay a Novell judgment terminates on December 31, 2009, with no guarantee that the Novell Litigation will be concluded. Further, the Court is unable to find based on this record, the Debtors' history of unsuccessful sale efforts and this sale's peculiar and questionable timing that Unixis has acted in good faith.

The Court is also very disturbed that the Sale Agreement contains a provision (which Movants refer to as a "poison pill") requiring the transfer of assets to Unixis upon conversion or appointment of a trustee. Here, again, the Sale Motion calls into question whether the sale has a sound business purpose and raises doubts of the parties' good faith. There is simply no record upon which the Court can find that the Sale is in the best interests of the creditors and the estate. The Sale Motion is denied as falling short of the required standards.

Will this plan be approved? Is it even real this time? We'll see. Stay tuned for any objections. They have to be filed by February 7. This is not yet a done deal. There will be a hearing on February 16 at 4 PM in Delaware bankruptcy court to decide whether this will actually happen this time.

Bonnie Fatell didn't sign this Notice. Instead Stanley B. Tarr did. Hmm. Here's the purchase info:

(v) All assignable and transferable Permits possessed by Seller necessary for the lawful ownership and operation of the Acquired Assets; (vi) All rights and claims of Seller against any third parties, directly arising from or directly related to the Acquired Assets (which, for the avoidance of doubt, shall not include any rights and claims of Seller against any third parties, directly arising from or directly related to the Excluded Assets, any rights and claims by Seller against Buyer relating to this Agreement or any agreement entered into pursuant hereto, or any rights, claims or causes of action related to Novell, Inc., International Business Machines Corporation, Red Hat, Inc. and SUSE Linux GmbH or other similar claims); and (vii) Subject to Section 6.4, all rights and interests of Seller in each of the Purchased Subsidiaries, provided that any intercompany receivables due from Seller to the Purchased Subsidiaries listed on Schedule 2.1(a)(vii) shall be waived at Closing.

6.4 Further Agreement. Except as provided herein, the parties agree that Seller shall be entitled to receive from Buyer an amount equal to the cash balances, net of uncleared disbursements, as adjusted into U.S. dollars, held by the Purchased Subsidiaries as of the Closing Date. The amount of such cash balances shall be determined based on the closing balance sheet of each Purchased Subsidiary prepared by Seller, which closing balance sheets shall be provided to Buyer not later than ten (10) business days following the Closing Date. Within fifteen (15) business days following the receipt of such closing balance sheet, Buyer shall remit to Seller the aggregate amount of cash held by all of the Purchased Subsidiaries as of the Closing Date converted into U.S. dollars.

Purchased Subsidiaries:

SCO Global, Inc.
SCO Software (UK) Ltd.
SCO Group France SARL
The SCO Group (Deutschland) GmbH
SCO Japan, Ltd.
SCO Software (India) Private Ltd.

(a) Pursuant to the Sale Order, and subject to the terms and conditions of this Agreement, Seller shall sell, transfer, assign and convey to Buyer, free and clear of any and all Encumbrances and Retained Obligations, and Buyer shall, as of the Closing Date, acquire and purchase, free and clear of any and all Encumbrances and Retained Obligations, all of Seller’s right, title and interest in and to all of the assets of the Business, except for the Excluded Assets set forth in Schedule 2.1(c) hereof (the “Acquired Assets”), including but not limited to, the following:

(i) All of Seller’s assets (tangible or intangible), including those assets set forth on Schedule 2.1(a), all Intellectual Property, including all copyrights developed after 1995, customer lists, purchase orders, customer reference manuals, databases and goodwill related thereto;

(ii) The Assumed Contracts, whether or not listed on Schedule 2.1(a);

(iii) Seller’s Contract Rights under the Assumed Contracts and all end user license agreements and maintenance contracts between Seller and customers relating to the Acquired Assets, excluding Contract Rights under (A) this Agreement and any other Contracts entered into by Seller with Buyer in connection with the transactions contemplated by this Agreement; (B) any Assumed Contracts requiring a Consent that is not obtained on or before the Closing Date or is not otherwise assigned to Buyer pursuant to the Sale Order (“Non-Assignable Contract(s)”) and (C) any and all employment agreements, labor contracts, stock option plans, retirement plans, Seller’s 401(k) plan, pension plans, agreements relating to the voting of shares in the company, agreements with employees, officers and/or shareholders and any and all other agreements relating to or otherwise concerning the foregoing.

(iv) Seller’s computer media, sales, advertising and marketing materials, catalogues and manuals, billing records, correspondence, data (only to the extent that such data that contains personally identifiable information that may be lawfully transferred), test software, software tools, product documentation, internal documentation, work in progress relating to the software products listed on Schedule 2.1(a), and files relating to the Acquired Assets (only to the extent that any such materials or files exist), excluding (A) Seller’s minute books, membership interest books and related organizational documents and (B) Seller’s files, books and records relating to the Excluded Assets or to Seller’s Obligations not included in the Assumed Obligations;

(v) All assignable and transferable Permits possessed by Seller necessary for the lawful ownership and operation of the Acquired Assets;

(vi) All rights and claims of Seller against any third parties, directly arising from or directly related to the Acquired Assets (which, for the avoidance of doubt, shall not include any rights and claims of Seller against any third parties, directly arising from or directly related to the Excluded Assets, any rights and claims by Seller against Buyer relating to this Agreement or any agreement entered into pursuant hereto, or any rights, claims or causes of action related to Novell, Inc., International Business Machines Corporation, Red Hat, Inc. and SUSE Linux GmbH or other similar claims); and

(vii) Subject to Section 6.4, all rights and interests of Seller in each of the Purchased Subsidiaries, provided that any intercompany receivables due from Seller to the Purchased Subsidiaries listed on Schedule 2.1(a)(vii) shall be waived at Closing.

(vi) All rights and claims of Seller against any third parties, directly arising from or directly related to the Acquired Assets (which, for the avoidance of doubt, shall not include any rights and claims of Seller against any third parties, directly arising from or directly related to the Excluded Assets, any rights and claims by Seller against Buyer relating to this Agreement or any agreement entered into pursuant hereto, or any rights, claims or causes of action related to Novell, Inc., International Business Machines Corporation, Red Hat, Inc. and SUSE Linux GmbH or other similar claims); and ...

(c) Excluded Assets. Notwithstanding anything to the contrary contained in Section 2.1(a) or elsewhere in this Agreement, the assets of Seller set forth in Schedule 2.1(c) (collectively, the “Excluded Assets”) are not part of the transactions contemplated hereunder, are excluded from the Acquired Assets and shall remain the property of Seller after the Closing.

Here are the "Acquired Assets" as per Schedule 2.1(c):

ACQUIRED ASSETS

(a) UnixWare Operating System Products

• SCO UnixWare 7 Release 7.1.4
• SCO UnixWare 7 Release 7.1.3
• SCO UnixWare 7 Release 7.1.2
• SCO UnixWare 7 LKP

(b) OpenServer Operating System Products

• SCO OpenServer Release 6.0
• SCO OpenServer Release 5.x (including all prior versions and releases)

(c) Layered Operating System Products

• SCO UnixWare and OpenServer Development Kits (all version)
• SCO Office
• SCO Open UNIX Development Kit
• SCO UnixWare 7 Online Data Manager
• SCO UnixWare 7 Disk Mirroring
• SCO UnixWare “OS Compatible” Requirements
• SCO UnixWare OpenServer Kernel Personality (OKP)

Trademarks ...

U. S. Copyright Registrations:

The following copyright registrations, except to the extent incorporating any Excluded Assets:

Title Owner - Reg. No.- Reg. Date - Status
SCO OpenServer : release 5.0.5 - SCO Group, Inc. - TX 6-008-305 - 8/31/2004 - Registered

UNIX system V : release 3.0 - The SCO Group, Inc. - TX 5-750-270 - 7/7/2003 - Registered
UNIX system V : release 3.1 - The SCO Group, Inc. - TX 5-750-269 - 7/7/2003 - Registered
UNIX system V : release 3.2 - The SCO Group, Inc.- TX 5-750-271 - 7/7/2003 - Registered
UNIX system V : release 3.2/386 - The SCO Group, Inc. - TX 5-750-268 - 7/7/2003 - Registered
UNIX system V : release 4.0 - The SCO Group, Inc. - TX 5-776-217 - 7/16/2003 - Registered
UNIX system V : release 4.1 - The SCO Group, Inc. - TX 5-762-234 - 7/3/2003 - Registered
UNIX system V, release 4.1ES - The SCO Group, Inc. - TX 5-705-356 - 6/30/2003 - Registered
UNIX system V : release 4.2 - The SCO Group, Inc. - TX 5-762-235 - 7/3/2003 - Registered
UNIX System V release 4.2MP - The SCO Group, Inc. - TX 5-972-097 - 6/29/2004 - Registered
UnixWare 7.1.3 - SCO Group, Inc. - TX 5-787-679 - 6/11/2003- Registered

Here are the excluded assets:

EXCLUDED ASSETS

i. all rights of Seller under this Agreement and all agreements contemplated hereby;

ii. all of Seller’s rights and obligations with respect to the SVRX Licenses (as defined in the Santa Cruz-Novell APA);

iii. the SCO Group 401(k) plan;

iv. all of Seller’s stock-based benefit plans, including stock option plans and the stock purchase plan;

v. the Seller’s directors and officers liability insurance policy;

vi. (a) cash and cash equivalents and marketable securities (including cash in transit and cash and marketable securities in lock boxes or on deposit with or otherwise held by any financial institution); (b) accounts receivable (including accounts receivable for services rendered through the Closing Date with respect to which invoices are mailed after the Closing Date) and other trade receivables; (c) all prepaid premiums and other prepayments and deposits with respect to Seller’s Employee Benefit Plans (if any), the Seller’s insurance policies, and any other Contracts not purchased by the Buyer; and (d) all cash held by the Purchased Subsidiaries on the Closing Date;

vii. All Receivables related to the Business and the Acquired Assets as of the Closing Date, the proceeds thereof and any security therefor;

viii. all rights of Seller in the Licensed Properties;

ix. all of Seller’s claims, causes of action and other legal or equitable rights and remedies
(A) against Buy
(B) relating to all rights and interests in all litigation claims pending or that may be asserted in the future, against International Business Machines Corporation, Novell, Inc., SUSE Linux GmbH or others, and
(C) relating to every claim of any nature whatsoever, known or unknown that has been or may be asserted against RedHat, Inc. or others relating to or arising from all licensing, covenant not to sue rights, releases or other claims relating to any allegations that Linux violates SCO’s Unix or UnixWare intellectual property, contract or other rights;

x. Seller’s historical financial and accounting records, and the accounting systems of Seller; and

xi. all documents or other data related to the litigation matters listed in Schedule 4.5 or referenced in Section 2.1(a)(vi) of the Agreement, including all litigation files, pleadings, motion practice, discovery, depositions, expert and other reports, and exhibits, backup material and the computer equipment, hard drives and databases utilized by Seller’s officers, and other materials related to or utilized in connection with such litigation matters.

Here's the info about the subs:

INTERCOMPANY RECEIVABLES

Intercompany activities between SCO Operations, Inc. and its affiliates arise under the agency agreements with the affiliates which call for a commission to be paid by SCO Operations Inc. to the affiliates based on a percentage of direct operating expenses incurred by the affiliates in the sales and marketing of the UNIX software products and services. This results in an intercompany payable on SCO Operation’s general ledger and an intercompany receivable from SCO Operations on the affiliates’ ledger.

This intercompany payable by SCO Operations and corresponding receivable from SCO Operations is reduced to the extent that funds are remitted by SCO Operations Inc. to its affiliates to fund the necessary trade obligations of the affiliates. Intercompany payable due from SCO Operations, Inc. to its affiliates as of October 31, 2010 are as follows.

SCO Software (UK) Ltd. - $431,418
The SCO Group (Deutschland) Gmbh - $618,943
SCO Software (India) Private Ltd. - $455,407

Intercompany receivables due from the affiliates as of October 31, 2010 are as follows:

The SCO Group (France) Sarl - $ 33,119
SCO Japan Ltd - $ 14,596

For purposes of the waiver by the Purchased Subsidiaries of intercompany receivables due from Seller, the amount waived shall be deemed to be the intercompany receivables in effect on the Closing Date.