I think they were already purchased with the slimy loan, but I
could be wrong.
I don't think they
were.
According to Article VII of the loan agreement between
The SCO Group and Seung Ni Capital Partners (aka the Yarro Loan Deal), the
Trustee's filing for Chapter 7 constitutes a default on the
loan:
In case of the happening of any of the following
events (each, an "Event of Default" and together, "Events of
Default"):
[...]
(i) Either of the cases constituting the
Bankruptcy Case shall be dismissed (or the Bankruptcy Court shall make a ruling
requiring the dismissal of either of the cases constituting the Bankruptcy
Case), suspended or converted to a case under Chapter 7 of the Bankruptcy code,
or the Borrower shall file any pleading requesting such relief;
[...]
(emphasis added) So TSG has already, by definition,
defaulted on the loan agreement. But the same section of the agreement goes on
to say:
In the event the Debtor fails either to cure the
Default or obtain a scheduled court hearing with regard ot the Default, the
automatic stay provided in Section 362 of the Bankruptcy Code shall be deemed
automatically vacated without further action or order of the Bankruptcy Court,
and the Lender shall be entitled to exercise all of its respective rights and
remedies under the Loan Documents, including all rights and remedies with
respect to the Collateral; provided, however, Lender shall have no right to
take any action with respect to the Litigation.
So even
in default, this agreement (which both parties and the Court agreed to) appears
to say that the Litigation does not automatically go to the
Lenders.
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"When I say something, I put my name next to it." --
Isaac Jaffe, "Sports Night" [ Reply to This | Parent | # ]
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