Unassociated Document


    
      
        

      



    SECURED
SUPER-PRIORITY CREDIT AGREEMENT

    


    dated as
of March 5, 2010

    


    among

    


    The
Bankruptcy Estates of The SCO Group, Inc., a Delaware corporation and SCO
Operations, Inc., a Delaware corporation, by and through Edward N. Cahn solely
in his capacity as Chapter 11 Trustee,

    


    as
Borrower

    


    and

    


    ____________________________________________,

    


    as
Lender


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    TABLE OF
CONTENTS

     

    
      
        
          
            
              	
                      RECITALS:

                    	 	 	6
	 
      	 	 	 
	
                      ARTICLE
      I  DEFINITIONS

                    	 	 	6
	 
      	 	 	 
	
                      SECTION
      1.01. Defined Terms

                    	 	 	6
	 
      	 	 	 
	
                      SECTION
      1.02. Terms Generally.

                    	 	 	14
	 
      	 	 	 
	
                      ARTICLE
      II  THE CREDITS

                    	 	 	15
	 
      	 	 	 
	
                      SECTION
      2.01. Commitments.

                    	 	 	15
	 
      	 	 	 
	
                      SECTION
      2.02. Loans.

                    	 	 	15
	 
      	 	 	 
	
                      SECTION
      2.03. Evidence of Debt; Repayment of Loan

                    	 	 	15
	 
      	 	 	 
	
                      SECTION
      2.04. Basic Interest and Fees on Loans/Loan Fee

                    	 	 	16
	 
      	 	 	 
	
                      SECTION
      2.05. Late Charge/Default Interest

                    	 	 	16
	 
      	 	 	 
	
                      SECTION
      2.06. Termination and Reduction of Commitments.

                    	 	 	16
	 
      	 	 	 
	
                      SECTION
      2.07. Repayment of Loan

                    	 	 	16
	 
      	 	 	 
	
                      SECTION
      2.08. Prepayment

                    	 	 	16
	 
      	 	 	 
	
                      SECTION
      2.09. Payments

                    	 	 	17
	 
      	 	 	 
	
                      SECTION
      2.10. Taxes

                    	 	 	17
	 
      	 	 	 
	
                      ARTICLE
      III  REPRESENTATIONS AND WARRANTIES

                    	 	 	17
	 
      	 	 	 
	
                      SECTION
      3.01. Organization; Powers

                    	 	 	17
	 
      	 	 	 
	
                      SECTION
      3.02. Enforceability

                    	 	 	17
	 
      	 	 	 
	
                      SECTION
      3.03. Governmental Approvals.

                    	 	 	18
	 
      	 	 	 
	
                      SECTION
      3.04. Title to Properties; Possession Under Leases.

                    	 	 	18
	 
      	 	 	 
	
                      SECTION
      3.05. Litigation; Compliance with Laws

                    	 	 	18
	 
      	 	 	 
	
                      SECTION
      3.06. Use of Proceeds

                    	 	 	18
	 
      	 	 	 
	
                      SECTION
      3.07. No Material Misstatements

                    	 	 	18
	 
      	 	 	 
	
                      SECTION
      3.08. Insurance

                    	 	 	19


            

          

        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    
      
        
          
            
              
                
                  	
                          SECTION
      3.09. Secured, Super-Priority Obligations

                        	 	 	19
	 
      	 	 	 
	
                          SECTION
      3.10. Location of Real Property and Leased Premises

                        	 	 	19
	 
      	 	 	 
	
                          SECTION
      3.11. Deposit Accounts

                        	 	 	19
	 
      	 	 	 
	
                          SECTION
      3.12  Ownership of Collateral.

                        	 	 	19
	 
      	 	 	 
	
                          ARTICLE
      IV  CONDITIONS OF LENDING

                        	 	 	20
	 
      	 	 	 
	
                          SECTION
      4.01. All Credit Events

                        	 	 	20
	 
      	 	 	 
	
                          ARTICLE
      V  AFFIRMATIVE COVENANTS

                        	 	 	21
	 
      	 	 	 
	
                          SECTION
      5.01. Existence; Businesses and Properties.

                        	 	 	21
	 
      	 	 	 
	
                          SECTION
      5.02. Insurance

                        	 	 	21
	 
      	 	 	 
	
                          SECTION
      5.03. Litigation and Other Notices.

                        	 	 	22
	 
      	 	 	 
	
                          SECTION
      5.04. Information Regarding Collateral

                        	 	 	22
	 
      	 	 	 
	
                          SECTION
      5.05. Maintaining Records; Access to Properties and
      Inspections

                        	 	 	22
	 
      	 	 	 
	
                          SECTION
      5.06. Use of Proceeds

                        	 	 	22
	 
      	 	 	 
	
                          SECTION
      5.07. Further Assurances

                        	 	 	22
	 
      	 	 	 
	
                          SECTION
      5.08. Bankruptcy Case

                        	 	 	23
	 
      	 	 	 
	
                          SECTION
      5.09. Bankruptcy Sale and Auction Process.

                        	 	 	23
	 
      	 	 	 
	
                          SECTION
      5.10. Use of Loan Proceeds/Sale of Core Assets/Use of Proceeds from Sale
      of Core Asset and Other Assets.

                        	 	 	23
	 
      	 	 	 
	
                          ARTICLE
      VI  NEGATIVE COVENANTS

                        	 	 	24
	 
      	 	 	 
	
                          SECTION
      6.01. Indebtedness

                        	 	 	24
	 
      	 	 	 
	
                          SECTION
      6.02. Liens.

                        	 	 	24
	 
      	 	 	 
	
                          SECTION
      6.03. Sale and Leaseback Transactions

                        	 	 	25
	 
      	 	 	 
	
                          SECTION
      6.04. Investments, Loans and Advances.

                        	 	 	25
	 
      	 	 	 
	
                          SECTION
      6.05. Mergers, Consolidations, Sales of Assets and
      Acquisitions

                        	 	 	25
	 
      	 	 	 
	
                          SECTION
      6.06. Restricted Payments; Restrictive Agreements

                        	 	 	26


                

              

            

          

        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    
      
        
          
            
              	
                      SECTION
      6.07. Transactions with Affiliates.

                    	 	 	26
	 
      	 	 	 
	
                      SECTION
      6.08. Business of Borrower

                    	 	 	26
	 
      	 	 	 
	
                      SECTION
      6.09. Other Indebtedness and Agreements

                    	 	 	26
	 
      	 	 	 
	
                      SECTION
      6.10. Capital Expenditures.

                    	 	 	27
	 
      	 	 	 
	
                      SECTION
      6.11. Chapter 11 Claims.

                    	 	 	27
	 
      	 	 	 
	
                      SECTION
      6.12. The Orders.

                    	 	 	27
	 
      	 	 	 
	
                      SECTION
      6.13. Right of First Refusal for Additional Indebtedness.

                    	 	 	27
	 
      	 	 	 
	
                      ARTICLE
      VII  EVENTS OF DEFAULT

                    	 	 	28
	 
      	 	 	 
	
                      ARTICLE
      VIII  MISCELLANEOUS

                    	 	 	30
	 
      	 	 	 
	
                      SECTION
      8.01. Notices

                    	 	 	30
	 
      	 	 	 
	
                      SECTION
      8.02. Survival of Agreement

                    	 	 	31
	 
      	 	 	 
	
                      SECTION
      8.03. Binding Effect

                    	 	 	31
	 
      	 	 	 
	
                      SECTION
      8.04. Successors and Assigns.

                    	 	 	32
	 
      	 	 	 
	
                      SECTION
      8.05. Expenses; Indemnity

                    	 	 	33
	 
      	 	 	 
	
                      SECTION
      8.06. Applicable Law

                    	 	 	34
	 
      	 	 	 
	
                      SECTION
      8.07. Waivers; Amendment.

                    	 	 	34
	 
      	 	 	 
	
                      SECTION
      8.08. Interest Rate Limitation

                    	 	 	35
	 
      	 	 	 
	
                      SECTION
      8.09. Entire Agreement.

                    	 	 	35
	 
      	 	 	 
	
                      SECTION
      8.10. Waiver Of Jury Trial.

                    	 	 	35
	 
      	 	 	 
	
                      SECTION
      8.11. Severability

                    	 	 	35
	 
      	 	 	 
	
                      SECTION
      8.12 Counterparts

                    	 	 	35
	 
      	 	 	 
	
                      SECTION
      8.13. Headings

                    	 	 	36
	 
      	 	 	 
	
                      SECTION
      8.14. Jurisdiction; Consent to Service of Process.

                    	 	 	36
	 
      	 	 	 
	
                      SECTION
      8.15. Confidentiality

                    	 	 	36
	 
      	 	 	 
	
                      SECTION
      8.16. Collateral Agent Agreement.

                    	 	 	37
	 
      	 	 	 
	
                      SECTION
      8.17. Other Provisions.

                    	 	 	37


            

          

        

      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    

    


    List of Schedules and
Exhibits

    


    
      
        	
                Schedule
      3.05

              	 
      	
                Litigation

              
	
                Schedule
      3.08

              	 
      	
                Insurance

              
	
                Schedule
      3.10(a)

              	 
      	
                Owned
      Real Property

              
	
                Schedule
      3.10(b)

              	 
      	
                Leased
      Real Property

              
	
                Schedule
      3.11

              	 
      	
                Deposit
      Accounts

              
	
                Schedule
      4.01(g)

              	 
      	
                Material
      Adverse Effect

              
	
                Schedule
      6.01

              	 
      	
                Existing
      Indebtedness

              
	
                Schedule
      6.02

              	 
      	
                Existing
      Liens

              
	
                Schedule
      6.04

              	 
      	
                Existing
      Investments

              
	 
      	 
      	 
      
	
                Exhibit
      “A”

              	 
      	
                Collateral
      Agent Agreement

              
	
                Exhibit
      “B”

              	 
      	
                List
      of Collateral

              
	
                Exhibit
      “C”

              	 
      	
                Form
      of Order

              
	
                Exhibit
      “D”

              	 
      	
                Note

              
	
                Exhibit
      “E”

              	
                  

              	
                List
      of Security Documents and Form of Security
  Agreements

              


      

    


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    SECURED SUPER-PRIORITY CREDIT AGREEMENT
(this “Agreement”), dated as
of March 5, 2010 (the “Effective Date”), by
and between the Bankruptcy Estates of The SCO Group, Inc., a Delaware
corporation (“SCO
Group”), and SCO Operations, Inc., a Delaware corporation (“SCO Operations”) (SCO
Group and SCO Operations are sometimes collectively referred to herein as “SCO”),  by
and through Edward N. Cahn, solely in his capacity as Chapter 11 trustee for the
Bankruptcy Estates of SCO (“Trustee” or “Borrower”), and
____________________________________________, as Lender.  This
Agreement is executed in connection with the following facts:

    


    RECITALS:

    


    A.           On
September 14, 2007 (the “Petition Date”), SCO
Group filed a voluntary petition for relief as Case No. 07-11337 (KG) and SCO
Operations filed a voluntary petition for relief as Case No. 07-11338 (KG)
(collectively, the “Bankruptcy Case”)
under chapter 11 of the United States Code (the “Bankruptcy Code”)
with the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy
Court”);

     

    B.           On
August 25, 2009, the Bankruptcy Court appointed the Honorable Edward N. Cahn,
retired, as Chapter 11 trustee, to operate SCO’s business and manage SCO’s
property;

     

    C.           The
Borrower has requested that the Lender provide a portion of secured
super-priority credit facility in a maximum amount up to $2,000,000.00 in order
to fund the administrative costs of the Bankruptcy Case, including, without
limitation, the payment of certain litigation costs;

     

    D.           The
Lender is willing to make available to the Borrower such post-petition loan upon
the terms and subject to the conditions set forth herein;

     

    E.           Other
Lenders shall provide the remaining portions of such secured super-priority
credit facility by entering into duplicate but separate versions of this
Agreement with the Borrower; and

     

    F.           The
Lender shall act as collateral Agent for all of the Lenders pursuant to the
terms of the Collateral Agent Agreement.

     

    NOW,
THEREFORE, in consideration of the premises and the covenants and agreements
contained herein, the parties hereto hereby agree as follows:

     

    ARTICLE
I


     

    DEFINITIONS

     

    SECTION
1.01. Defined
Terms. As used in this Agreement, the following terms have the meanings
specified below:


    
      
         


      

      
        6

        
          

        

      

      
         


      

    

     

    “Affiliate” means,
when used with respect to a specified Person, another Person that directly, or
indirectly through one or more intermediaries, Controls or is Controlled by or
is under common Control with the Person specified; provided, however, that, for
purposes of Section 6.07, the term “Affiliate” shall also include any Person
that directly or indirectly owns 10% or more of any class of Equity Interests of
the Person specified or that is an officer or director of the Person
specified.

     

    “Agent” means Seung Ni
Capital Partners, L.L.C., a Utah limited liability company, acting as collateral
agent on its own behalf and on behalf of the other Lenders pursuant to the terms
of the Collateral Agent Agreement attached hereto as Exhibit
“A”.

     

    “Agreement” means this
Agreement, as that term is defined in the preamble hereto.

     

    “Applicable Law”
means, with respect to any Person, the common law and all federal, state, local
and foreign laws, rules, regulations, orders, judgments, decrees and other legal
requirements or determinations of any Governmental Authority or arbitrator,
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject.

     

    “Bankruptcy Case” has
the meaning assigned to such term in the recitals hereto.

     

    “Bankruptcy Code” has
the meaning assigned to such term in the recitals hereto.

     

    “Bankruptcy Court” has
the meaning assigned to such term in the recitals to this Agreement; provided,
however, that “Bankruptcy Court” shall also mean any other court of competent
jurisdiction over the Bankruptcy Case.

     

    “Basic Interest” means
interest accruing at the annual rate of fourteen percent (14%) per annum,
compounded quarterly, as set forth in the Note and on the amount of the
Indebtedness set forth in the Note.

     

    “Business Day” means
any day other than a Saturday, Sunday or day on which banks in New York City are
authorized or required by law to close.

     

    “Capital Expenditures”
means, for any period and with respect to any Person, all expenditures for the
acquisition or leasing of fixed or capital assets or additions to equipment
during such period by such Person that would be classified as capital
expenditures in accordance with GAAP, but excluding any such expenditure made:
(a) to restore, replace or rebuild property to the condition of such property
immediately prior to any damage, loss, destruction or condemnation of such
property, to the extent such expenditure is made with insurance proceeds,
condemnation awards or indemnification or damage recovery proceeds relating to
any such damage, loss, destruction or condemnation; or (b) with proceeds from
the sale or exchange of property to the extent utilized to purchase functionally
equivalent property or equipment.

     

    “Claims” means claims,
actions, causes of action, suits, debts, accounts, interests, liens, promises,
warranties, damages and consequential damages, demands, agreements, bonds,
bills, specialties, covenants, controversies, variances, trespasses, judgments,
executions, costs, expenses or any other claims whatsoever (including, without
limitation, cross-claims, counterclaims, rights of set-off and
recoupment).


    
      
         


      

      
        7

        
          

        

      

      
         


      

    

    


    “Closing Date” means
the date that is one (1) Business Day after the date on which the Order is
issued by the Bankruptcy Court and on which the Lender shall disburse its
portion of the Loan to the Borrower, but in no event shall the Closing Date
occur after March 8, 2010.

     

    “Code” means the
Internal Revenue Code of 1986, as amended from time to time.

     

    “Collateral” means all
collateral and security identified on Exhibit “B” hereto
and as described in any Security Document and specifically excludes all claims
and causes of action  of the Estates under Chapter 5 of the Bankruptcy
Code.

     

    “Collateral Agent
Agreement” means that certain Collateral Agent Agreement attached hereto
as Exhibit “A”
under which Agent shall act as collateral agent for all Lenders with respect to
any and all Lenders’ rights in and to the Collateral.

     

    “Commitment” means the
Lender’s agreement to make a portion of the Loan, the amount of which is more
particularly set forth on Exhibit “A” to the Note, as such portion of the amount
of the Loan may be reduced from time to time pursuant to Section 2.06
hereof.  The maximum amount of the Loan from all Lenders, including
the Lender, shall not exceed Two Million and 00/100 Dollars ($2,000,000.00), the
actual and exact amount of which shall be equal to the aggregate amount of the
aggregate Loan funds actually disbursed by the Lender hereunder and by the other
Lenders under duplicate originals of this Agreement between such Lenders and
Borrower.

     

    “Control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the
ownership of voting securities, by contract or otherwise, and the terms “Controlling” and
“Controlled”
shall have meanings correlative thereto.

     

    “Core Asset Sale”
means the sale, license, transfer or other disposition (by way of merger,
casualty, condemnation or otherwise) by the Borrower to any Person (other than
the Borrower) of any SCO assets other than Borrower’s rights in the Litigation
and the Litigation Proceeds and other than SCO’s Non-Core Assets, as defined
herein.

     

    “Credit Event” has the
meaning assigned to such term in Section 4.01.

     

    “Default” means any
event or condition which upon notice, lapse of time or both would constitute an
Event of Default.

     

    “Debtors” shall mean
The SCO Group, Inc. and SCO Operations, Inc.

     

    “Dollars” or “$“ means lawful money
of the United States of America.

     

    “Effective Date” is
the date first set forth above on this Agreement.

     

    “Entry Date” means the
date of the entry of the Order.


    
      
         


      

      
        8

        
          

        

      

      
         


      

    

     

    “Equity Interests”
means shares of capital stock, partnership interests, membership interests in a
limited liability company, beneficial interests in a trust or other equity
interests in any Person, or any obligations convertible into or exchangeable
for, or giving any Person a right, option or warrant to acquire such equity
interests or such convertible or exchangeable obligations.

     

    “ERISA” means the
Employee Retirement Income Security Act of 1974, as the same may be amended from
time to time.

     

    “ERISA Affiliate”
means any trade or business (whether or not incorporated) that, together with
the Borrower, is treated as a single employer under Section 414(b) or (c) of the
Code, or solely for purposes of Section 302 of ERISA and Section 412 of the
Code, is treated as a single employer under Section 414 of the
Code.

     

    “ERISA Event” means:
(a) any “reportable event”, as defined in Section 4043 of ERISA or the
regulations issued thereunder, with respect to a Plan (other than an event for
which the 30-day notice period is waived); (b) the existence with respect to any
Plan of an “accumulated funding deficiency” (as defined in Section 412 of the
Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to
Section 412(d) of the Code or Section 303(d) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (d) the
incurrence by the Borrower or any of its ERISA Affiliates of any liability under
Title IV of ER1SA with respect to the termination of any Plan or the withdrawal
or partial withdrawal of the Borrower or any of its ERISA Affiliates from any
Plan; (e) the receipt by the Borrower or any of its ERISA Affiliates from a plan
administrator of any notice relating to the intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (f) the adoption of any
amendment to a Plan that would require the provision of security pursuant to
Section 401(a)(29) of the Code or Section 307 of ERISA; (g) the occurrence of a
“prohibited transaction” with respect to which the Borrower is a “disqualified
person” (within the meaning of Section 4975 of the Code) or with respect to
which the Borrower could otherwise be liable; or (h) occurrence of any
substantially similar event identified in (a) through (g) above as determined by
Lender in its reasonable discretion with respect to a Foreign Plan.

     

    “Estate” means,
collectively, the bankruptcy estates of The SCO Group, Inc., and of SCO
Operations, Inc., as defined by § 541 of the Bankruptcy Code.

     

    “Event of Default” has
the meaning assigned to such term in Article VII.

     

    “Facility” means the
credit facility comprising the Loan made to the Borrower in accordance with
Section 2.01 and 2.02(a) hereof.

     

    “Foreign Plan” means a
non-governmental employee benefit plan sponsored or maintained by, or
contributed to, by Borrower or any of its Affiliates under the laws of a
jurisdiction outside the United States for the benefit of its employees or the
employees of any of its Affiliates.

     

    “GAAP” means prudent
and reasonable accounting principles applied on a consistent basis.

     

    “Governmental
Authority” means any federal, state, local, or foreign court or
governmental agency, authority, instrumentality, or regulatory
body.


    
      
         


      

      
        9

        
          

        

      

      
         


      

    


    “Indebtedness” of any
Person means, without duplication: (a) all obligations of such Person for
borrowed money, including the Loan evidenced by the Note; (b) all obligations of
such Person evidenced by bonds, debentures, notes or similar instruments; (c)
all obligations of such Person under conditional sale or other title retention
agreements relating to property or assets purchased by such Person; (d) all
obligations of such Person issued or assumed as the deferred purchase price of
property or services (excluding trade accounts payable and accrued obligations
incurred in the ordinary course of business); (e) all Indebtedness of others
secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien on property owned or
acquired by such Person, whether or not the obligations secured thereby have
been assumed; (f) all guarantees by such Person of Indebtedness of others; (g)
all obligations of such Person as an account party in respect of letters of
credit; and (h) all obligations of such Person as an account party in respect of
bankers’ acceptances. The Indebtedness of any Person shall include the
Indebtedness of any partnership in which such Person is a general partner,
except to the extent that, by its terms, such Indebtedness is non-recourse to
such Person.

     

    “Intellectual
Property” means: (a) all right, title and interest of Borrower in and to
patent applications and patents, including, without limitation, all proceeds
thereof (such as, by way of example, license royalties and proceeds of
infringement suits), the right to sue for past, present and future
infringements, all rights corresponding thereto throughout the world, and all
reissues, divisions, continuations, renewals, extensions, and
continuations-in-part thereof (collectively, the “Patents”); (b) all
right, title and interest of Borrower in and to trademark applications and
trademarks, including, without limitation, all renewals thereof, all proceeds
thereof (such as, by way of example, license royalties and proceeds of
infringement suits), the right to sue for past, present and future
infringements, and all rights corresponding thereto throughout the world
(collectively, the “Trademarks”), and the
good will of the business to which each of the Trademarks relates; (c) all
copyrights of Borrower and all rights and interests of every kind of Borrower in
copyrights and works protectible by copyright, and all renewals and extensions
thereof, and in and to the copyrights and rights and interests of every kind or
nature in and to all works based upon, incorporated in, derived from,
incorporating or relating to any of the foregoing or from which any of the
foregoing is derived, and all proceeds thereof (such as, by way of example,
license royalties and proceeds of infringement suits), the right to sue for
past, present and future infringements, and all rights corresponding thereto
throughout the world (collectively, the “Copyrights”); (d) all
of Borrower’s trade secrets and other proprietary information, and all proceeds
thereof (collectively, the “Trade Secrets”); (e)
all right, title, and interest of Borrower in, to and under license agreements
and contracts concerning Patents, Trademarks, Copyrights, and Trade Secrets, all
amendments, modifications, and replacements thereof, all royalties and other
amounts owing thereunder, and all proceeds thereof (collectively, the “Licenses”); and (e)
All internet domain names and addresses of Borrower and all proceeds
thereof.

     

    “Lender” means
____________________________________________;

     

    “Lenders” means the
Lender and each additional Person that enters into a duplicate original of this
Agreement and under which such additional Person agrees to make some portion of
the Loan to Borrower thereunder, and such additional Person’s successors and
assigns.


    
      
         


      

      
        10

        
          

        

      

      
         


      

    


    “Lien” means, with
respect to any asset: (a) any mortgage, deed of trust, lien, pledge,
encumbrance, charge or security interest in or on such asset; and (b) the
interest of a vendor or a lessor under any conditional sale agreement, title
retention agreement (or any financing lease having substantially the same
economic effect as any of the foregoing) relating to such asset.

     

    “Litigation” means the
following two (2) pending cases:

     

    1.  The
SCO Group, Inc., by and through Edward N. Cahn, chapter 11 Trustee, v. Novell,
Inc., Case No. 2:04cv00139, pending in the United States District Court for the
District of Utah.

     

    2.  The
SCO Group, Inc. v. International Business Machines Corporation,, Case No.
2:03cv00294, pending in the United States District Court for the District of
Utah.

     

    “Litigation Proceeds”
means with respect to the Litigation: (a) the entire amount(s) of any final,
non-appealable verdict and/or arbitration  or mediation award(s)
received by the SCO Estates; (b) any amounts agreed to in any settlement and
received by the SCO Estates; (c) any attorney fees and costs incurred and
ordered or agreed to be paid by the other party(ies) to the Litigation; (d) all
of the foregoing described amounts arising in any further litigation involving
IBM, Novell, Red Hat, and/or Daimler Chrysler and SCO with respect to the same
or similar substantive claims involved in the Litigation and received by the SCO
Estates;  (e) all pre-judgment and post-judgment interest received by
the SCO Estates relating to any and all of the foregoing; and/or (f) all
proceeds from the sale of some or all of the assets or the shares of either or
both of the Debtors and their respective Affiliates in the event such sale
occurs in connection with the settlement of the Litigation.

     

    “Loan” means a loan in
an amount not to exceed Two Million and 00/100 Dollars
($2,000,000.00).  The Lender has agreed hereunder to make a portion of
the Loan, the exact amount of which is set forth on Exhibit “A” to the
Note.

     

    “Loan Documents” means
this Agreement, the Note, the Security Documents, and any other documents
executed in connection with any of the foregoing.

     

    “Loan Fee” means that
portion of the Litigation Proceeds payable from the Borrower to the Lenders in
accordance with the Note and calculated by multiplying six and six-tenths
percent (6.60%) times the following two numbers: (a) a fraction, the numerator
of which is the actual of amount of the Loan disbursed by all of the Lenders to
the Borrower under this Agreement and duplicate originals of this Agreement
executed by Lenders other than the Lender, and the denominator of which shall be
$2,000,000.00; and (b) the actual amount of the gross Litigation
Proceeds.  By way of example, if the Loan disbursed by all Lenders to
Borrower were $1,500,000.00 and if the gross Litigation Proceeds are
$25,000,000.00, then the Loan Fee would be $1,237,500.00 (.066 x
1,500,000/2,000,000 x 25,000,000).  The Borrower’s obligation to pay
the Loan Fee is a material inducement to the Lender’s willingness to enter into
this Agreement and to make the Loan.  The Lender shall be entitled to
its proportionate share of the Litigation Proceeds in accordance with the
Note.

     

    “Loan Fee Maturity
Date” means the date that is ten (10) calendar days after the date on
which the Litigation Proceeds become available to the Borrower.


    
      
         


      

      
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    “Loan Termination
Date” means the earlier to occur of: (a) the date on which the Commitment
is permanently reduced to zero pursuant to Section 2.06; and (b) the date that
is five (5) days after the Closing Date.

     

    “Material Adverse
Effect” means: (a) an adverse effect on the business, assets, operations,
or condition (financial or otherwise) of the Borrower; (b) an impairment of the
ability of the Borrower, to perform any of its obligations under any Loan
Document to which it is or will be a party; or (c) an impairment of the rights
of or benefits available to the Lender under any Loan Document; provided,
however, that: (i) the filing of the Bankruptcy Case and the consequences that
customarily result from reorganization under chapter 11 of the Bankruptcy Code;
(ii) the entry into this Agreement or the public announcement thereof; and (iii)
changes in general economic conditions, financial markets or conditions
generally affecting the business of the Borrower, to the extent the business of
the Borrower is not disproportionately affected by such changes, shall not be
considered in determining whether there has been a “Material Adverse Effect;” or
(c) an adverse effect affecting a material portion of the
Collateral.

     

    “Material
Indebtedness” means any and all Indebtedness (other than the Loan), of
the Borrower in an aggregate principal amount exceeding $25,000.00.

     

    “Maturity Date” means,
with respect to the payment of the principal, Basic Interest and all other
amounts due under the Note, the earliest to occur of the following: (a) October
31, 2011; (b) the date of acceleration of any outstanding portion of the
Facility; (c) conversion of any of the Borrower’s Bankruptcy Case to a case
under chapter 7 of the Bankruptcy Code (“Chapter 7”), unless
otherwise consented to in writing by the Lender; (d) dismissal either or both of
the cases constituting the Bankruptcy Case, unless otherwise consented to in
writing by the Lender; and (e) confirmation of the Plan of Reorganization or
liquidation, except to the extent that the proposed treatment of the Loan in the
Plan or Reorganization is acceptable to Lender.

     

    “Non-Core Assets”
means SCO’s excess equipment and other miscellaneous assets in storage (truck,
forklifts and excess office equipment), the Java Patent, more particularly
described and known as US Patent No. 6,931,544, and assets related to SCO’s
mobility business.

    


    “Note” means that
certain Secured Super-Priority Promissory Note, of even date with this
Agreement, in the original principal amount of up to $2,000,000.00, which is
attached hereto as Exhibit
“D.”  The principal, the Basic Interest and all other amounts
(other than the Loan Fee) shall be due and payable in full on the Maturity Date,
and the Loan Fee shall be due and payable in full on the Loan Fee Maturity
Date.

     

    “Obligations” means
all obligations, covenants, and requirements of Borrower contained in the Note
and the Security Documents, including, without limitation, Borrower’s obligation
set fort herein and in the Note to repay the Loan.

     

    “Order” means an order
of the Bankruptcy Court pursuant to Section 364 of the Bankruptcy Code, in form
and substance satisfactory to the Lender, approving this Agreement and the other
Loan Documents, authorizing the incurrence by the Borrower of permanent
post-petition secured and super-priority Indebtedness in accordance with this
Agreement and the other Loan Documents, as to which no stay has been entered and
that has not been reversed, modified, vacated or overturned.


    
      
         


      

      
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    “Other Taxes” means
any and all present or future stamp or documentary taxes or any other excise or
property taxes, charges, or similar levies arising from any payment made under
any Loan Document or from the execution, delivery or enforcement of, or
otherwise with respect to, any Loan Document.

     

    “Person” means any
natural person, corporation, business trust, joint venture, association,
company, limited liability company, partnership, Governmental Authority or other
entity.

     

    “Petition Date” has
the meaning assigned to such term in the recitals to this
Agreement.

     

    “Plan” means any
employee pension benefit plan subject to the provisions of ERISA or Section 412
of the Code or Section 307 of ERISA, and in respect of which the Borrower or any
ERISA Affiliate is (or, if such plan were terminated, would under Section 4069
of ERISA be deemed to be) an “employer” as defined in Section 3(5) of
ERISA.

     

    “Plan of
Reorganization” means that certain plan of reorganization or liquidation
to be filed with the Bankruptcy Court in form and substance reasonably
satisfactory to the Lender, and with such amendments as may be approved by the
Lender (such approval not to be unreasonably withheld); provided, however, that
if the Loan hereunder is repaid in full prior to or in connection with the
filing of the Plan of Reorganization, Lender shall have no right to review or
approve such Plan of Reorganization prior to filing.

     

    “Related Lender Party”
means, with respect to any specified Person, any Affiliate and the respective
directors, officers, employees, agents and advisors of such Person and of such
Person’s Affiliates.

     

    “Requisite Priority”
means the following: (a) pursuant to Bankruptcy Code §364(c)(2), a first
priority, perfected Lien upon the Borrower’s right, title and interest in, to
and under the Collateral; and (b) pursuant to §364(c)(1) a super-priority
administrative expense with priority over any or all administrative expenses of
the kind specified in §503(b) or §507(b).

     

    “Restricted Payment”
means any dividend, interest, or other distribution (whether in cash, securities
or other property) with respect to any Equity Interests in the Borrower or any
payment (whether in cash, securities or other property), including any sinking
fund or similar deposit, on account of the purchase, redemption, retirement,
acquisition, cancellation or termination of any Equity Interests in the Borrower
or any option, warrant or other right to acquire any such Equity Interests in
the Borrower.

     

    “Security Documents”
means those security agreements and other instruments and documents executed and
delivered pursuant to the foregoing or pursuant to Section 5.07 and attached
hereto as Exhibit
“E.”

     

    “Subsidiary” means,
with respect to any Person, any corporation, partnership, limited liability
company, joint venture or other legal entity of any kind of which such Person
(either alone or through or together with one or more of its other
Subsidiaries), owns, directly or indirectly, more than fifty percent (50%) of
the capital stock or other equity interests the holders of which are: (a)
generally entitled to vote for the election of the board of directors or other
governing body of such legal entity; or (b) generally entitled to share in the
profits or capital of such legal entity


    
      
         


      

      
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    “Taxes” means any and
all present or future taxes, or other levies, imposts, duties, deductions,
charges, liabilities, or withholdings in the nature of a tax imposed by any
Governmental Authority.

     

    “Transactions” means,
collectively: (a) the filing of the Bankruptcy Case; (b) the execution and
delivery of this Agreement; (c) the borrowing of the Loan hereunder; and (d) the
payment of related fees and expenses.

     

    “Trustee” means Edward
N. Cahn, solely in his capacity as trustee for the Estate of both
Debtors.

     

    “Voluntary Prepayment”
means a prepayment of principal of Loan pursuant to Section 2.08 in any year to
the extent that such prepayment reduces the principal due in respect of the Loan
on the Maturity Date.

     

    “Wholly Owned
Subsidiary” of any Person means a Subsidiary of such Person of which
securities (except for directors’ qualifying shares) or other ownership
interests representing 100% of the Equity Interests are, at the time any
determination is being made, owned, controlled, or held by such Person or one or
more wholly owned Subsidiaries of such Person or by such Person and one or more
wholly owned Subsidiaries of such Person.

     

    SECTION
1.02. Terms
Generally. The definitions in Section 1.01 shall apply equally to both
the singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words “include”, “includes” and “including” shall be deemed to
be followed by the phrase “without limitation”. The word “will” shall be
construed to have the same meaning and effect as the word “shall”; and the words
“asset” and “property” shall be construed as having the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights. All references herein
to Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
the context shall otherwise require. Except as otherwise expressly provided
herein: (a) any reference in this Agreement to any document means such document
as amended, restated, supplemented or otherwise modified from time to time in
accordance with the terms thereof and of this Agreement; and (b) all terms of an
accounting or financial nature shall be construed in accordance with GAAP, as in
effect from time to time; provided, however, that if the Borrower notifies the
Lender that the Borrower wishes to amend any covenant in Article VI or any
related definition to eliminate the effect of any change in GAAP occurring after
the Closing Date on the operation of such covenant (or if the Lender notifies
the Borrower that the Lender wishes to amend Article VI or any related
definition for such purpose), then the Borrower’s compliance with such covenant
shall be determined on the basis of GAAP in effect immediately before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant is amended in a manner satisfactory to the Borrower and the
Lender.


    
      
         


      

      
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    ARTICLE
II

     

    THE
CREDITS

     

    SECTION
2.01. Commitment.  Subject
to the terms and conditions and relying upon the representations and warranties
herein set forth, the Lender agrees to make a portion of a loan to the Borrower
on the Closing Date in the amount of that portion of the Loan Amount (the “Loan”) set forth on
Exhibit “A” to the Note.  The total amount of such loan, including the
Lender’s portion thereof made hereunder, shall be defined here as the “Loan” for all
purposes under this Agreement and the other Loan Documents.  The total
amount of the Loan shall be equal to the amount of Loan proceeds disbursed to
the Borrower hereunder by the Lender and under duplicate originals of this
Agreement by the other Lenders.  Notwithstanding the foregoing, prior
to and after the Entry Date of the Order, the aggregate principal amount of Loan
from all Lenders and outstanding at any time shall not be less than Eight
Hundred Thousand and 00/100 Dollars ($800,000.00) and shall not exceed Two
Million and 00/100 Dollars ($2,000,000.00).  The Lender’s portion of
the Commitment shall: (a) reduce to zero immediately after the borrowing of the
Loan pursuant to this Section 2.01; and (b) terminate immediately and without
further action on the Loan Termination Date.  Amounts paid or prepaid
in respect of Loan may not be re-borrowed.

     

    SECTION
2.02. Loan.  (a)
The Lender shall make a portion of the Loan in accordance with its Commitment,
the amount of which is listed on Exhibit “A” to the Note..

     

    (b)           The
Lender shall make its portion of the Loan set forth on Exhibit “A” to the Note
on the Closing date by wire transfer of immediately available funds to such
account as the Borrower may designate in writing.

     

    SECTION
2.03. Evidence of
Debt/Repayment of Loan. (a) The Borrower hereby unconditionally promises
to pay to the Lender the Lender’s portion of the principal amount of the Loan,
as provided in Section 2.07 hereof and pursuant to the Note.

     

    (b)           The
Lender shall maintain an account or accounts evidencing its portion of the
indebtedness of the Borrower to the Lender resulting from the Loan made by the
all of the Lenders from time to time, including the amounts of principal and
interest payable and paid to the Lender from time to time under this Agreement
and under the Note.

     

    (c)           The
entries made in the accounts maintained pursuant to Section 2.03(b) above shall
be prima facie evidence of the existence and amounts of the obligations therein
recorded; provided, however, that the failure of the Lender to maintain such
accounts or any error therein shall not in any manner affect the obligations of
the Borrower to repay the Loan in accordance with their terms.

     

    (d)           The
Loan shall be evidenced by and shall be repaid pursuant to the terms of the
Note.


    
      
         


      

      
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    SECTION
2.04. Basic Interest
and Fees on Loan/Loan Fee.

     

    (a)           Subject
to the provisions of Section 2.05 hereof, the Loan shall bear Basic Interest
(computed on the basis of the actual number of days elapsed over a year of three
hundred sixty (360) days).

     

    (b)           Basic
Interest on the Loan shall be due and payable to the Lender on the Maturity
Date, except as otherwise expressly provided in this Agreement or in the
Note.

     

    (c)           The
Borrower’s obligation to pay the Loan Fee, including the Lender’s portion
thereof, shall survive prepayment or payment of the Note and other Obligations
under this Credit Agreement.

     

    (d)           The
Borrower acknowledges and agrees that its obligation to pay the Loan Fee is a
material inducement to the Lender’s desire and willingness to enter into this
Agreement and the Loan Documents and to make the Loan pursuant
thereto.

     

    (e)           The
Borrower shall pay in full and in immediately available funds the Loan Fee on or
before the Loan Fee Maturity Date.

     

    SECTION
2.05. Late
Charge/Default Interest. If an Event of Default under this Agreement or
the other Loan Documents has occurred and is continuing after notice thereof,
the Borrower shall: (a) on demand from the Lender pay a late charge equal to
five percent (5%) of any past-due amount owed hereunder; and (b) on demand from
time to time pay Basic Interest, in all cases, at the rate otherwise applicable
to the Loan pursuant to Section 2.04, plus six percent (6.00%) per annum until
such Event of Default is cured in accordance with this Agreement.

     

    SECTION
2.06. Termination and
Reduction of Commitment. (a) The Commitment shall automatically terminate
on the Loan Termination Date.

     

    (b)           Upon
at least one (1) Business Day’s prior irrevocable written or fax notice to the
Lender, the Borrower may at any time in whole permanently terminate, or from
time to time in part permanently reduce, the Commitment.

     

    SECTION
2.07. Repayment of
Loan. (a) The Note shall require that, to the extent not previously paid,
the principal of the Loan, all Basic Interest and all other amounts due under
the Note (other than the payment of the Loan Fee), shall be due and payable on
the Maturity Date, and that the Loan Fee shall be due and payable in full on the
Loan Fee Maturity Date.

     

    (b)           All
repayments pursuant to this Section 2.07 shall be without premium or penalty,
except for any Default Interest and any other amounts due under the Note and
except for payment of the Loan Fee.

     

    SECTION
2.08. Voluntary
Prepayment. (a) The Borrower shall have the right at any time and from
time to time to make a Voluntary Prepayment of all or any portion of the
principal amount owed under the Loan, upon at least one Business Day’s prior
written or fax notice (or telephone notice promptly confirmed by written or fax
notice), to the Lender before 12:00 (noon), New York City time; provided,
however, that each partial prepayment shall be in an amount that is a multiple
of $10,000, and further provided that Borrower’s obligation to pay the Loan Fee
shall survive prepayment of the Loan until the Litigation
Proceeds have become available from which the Loan Fee shall be paid in
accordance with the Note.


    
      
         


      

      
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    (b)           Each
notice of Voluntary Prepayment: (i) shall specify the prepayment date and the
principal amount of each Loan (or portion thereof) to be prepaid; and (ii) shall
be irrevocable and shall commit the Borrower to prepay the Loan by the amount
stated therein on the date stated therein. All prepayments under this Section
2.08 shall be without premium or penalty.

     

    SECTION
2.09. Payments.
(a) The Borrower shall make each payment (including costs owned hereunder,
principal, Basic Interest, Default Interest, the Loan Fee and all other amounts
due under the Note) hereunder, under any other Loan Document and, to the extent
payable to the Lender, under the Order, not later than 1:00 p.m., New York City
time, on the date when due in immediately available funds, without setoff,
defense or counterclaim.  Each such payment shall be made to the
Lender at an address and account identified in writing by the
Lender.

     

    (b)           Except
as otherwise expressly provided herein, whenever any payment (including
principal of or Basic Interest and any Default Interest owed on any Loan or
other amounts) hereunder or under any other Loan Document shall become due, or
otherwise would occur, on a day that is not a Business Day, such payment may be
made on the next succeeding Business Day, and such extension of time shall in
such case be included in the computation of Basic Interest and Default Interest,
if applicable.

     

    (c)           Except
for a Voluntary Prepayment, all other payments due under the Note and hereunder
shall first be applied to any costs owed under the Note or the other Loan
Documents, then to accrued Basic Interest and any Default Interest owed on the
principal amount being prepaid to the date of payment, and then to the principal
amount owed.

     

    SECTION
2.10. Taxes.  The
Borrower shall pay any Other Taxes to the relevant Governmental Authority in
accordance with Applicable Law.

     

    ARTICLE
III

     

    REPRESENTATIONS AND
WARRANTIES

     

    The
Borrower represents and warrants to the Lender that:

     

    SECTION
3.01. Organization;
Powers. The Trustee is, pursuant to 11 U.S.C.
§1104,  the duly appointed, authorized and acting trustee for the
bankruptcy estates of the Debtors, having and exercising all rights of a trustee
under 11 U.S.C. §1106.

     

    SECTION
3.02. Enforceability. Upon
the entry of the Order, this Agreement shall have been, and each other Loan
Document shall have been upon delivery thereof pursuant to the terms of this
Agreement, duly executed and delivered by the Borrower. Subject to the entry of
the Order, this Agreement is, and each of the other Loan Documents will be, a
legal, valid and binding obligation of the Borrower enforceable against the
Borrower in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, fraudulent conveyance, reorganization and
other similar laws relating to or affecting creditors’ rights generally and
general equitable principles.


    
      
         


      

      
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    SECTION
3.03. Governmental
Approvals. Subject to the entry of the Order, no action, consent or
approval of, registration or filing with or any other action by any Governmental
Authority is or will be required in connection with the Transactions, except for
such as have been made or obtained and are in full force and
effect.

     

    SECTION
3.04. Title to
Properties; Possession Under Leases. Other than as a result of the
Bankruptcy Case, the Borrower has good and marketable title to, or valid
leasehold interests in, all its material properties and assets, except for minor
defects in title that do not interfere with its ability to conduct its business
as currently conducted or to utilize such properties and assets for their
intended purposes. Subject to the Order, all such material properties and
assets. are free and clear of Liens, other than Liens expressly permitted by
Section 6.02.

     

    SECTION
3.05. Litigation/Compliance with
Laws. Except as expressly set forth on the Schedules of Assets and
Liabilities and Statements of Financial Affairs already filed by Debtors in the
Bankruptcy Case, and other than the Bankruptcy Case, and except as set forth on
Schedule 3.05, there are no actions, suits or proceedings at law or in equity or
by or before any Governmental Authority now pending or, to the knowledge of the
Borrower, threatened against or affecting the Borrower or its business, property
or rights that involve any Loan Document or the Transactions contemplated
hereby.

     

    SECTION
3.06. Use of
Proceeds. The Borrower will use the proceeds of the Loan solely: to pay
fees and expenses related to the administration of the Bankruptcy Case, the
operation of the Debtors and the costs related to the Litigation and the
consummation of the Transactions contemplated by and subject to the terms of
this Agreement. The Borrower shall use the entire amount of the proceeds of each
Loan solely in accordance with this Section 3.06; provided, however, that
nothing herein shall in any way prejudice or prevent the Lender from objecting,
for any reason, to any requests, motions or applications made in the Bankruptcy
Court, including any applications for interim or final allowances of
compensation for services rendered or reimbursement of expenses incurred under
clause (a) of Section 105, or Section 330 or 331 of the Bankruptcy Code, by any
party in interest.  For avoidance of doubt, no proceeds of the Loan or
any cash collateral shall be available for any fees or expenses incurred in
connection with the initiation or prosecution of any claims, causes of action,
adversary proceedings or other litigation against the Lender.

     

    SECTION
3.07. No Material
Misstatements. No information, report, financial statement, exhibit or
schedule furnished by or on behalf of the Borrower to the Lender in connection
with the negotiation of any Loan Document or included therein or delivered
pursuant thereto, when taken as a whole, contained, contains or will contain any
material misstatement of fact; provided that to the extent any such information,
report, financial statement, exhibit or schedule was based upon or constitutes a
forecast or projection, the Borrower represents only that it acted in good faith
and utilized reasonable assumptions and due care in the preparation of such
information, report, financial statement, exhibit or schedule.


    
      
         


      

      
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    SECTION
3.08. Insurance. Schedule
3.08 sets forth a true, complete and correct description of all insurance
maintained by the Borrower as of the Closing Date. As of the Closing Date, such
insurance is in full force and effect and all premiums have been duly paid. The
Borrower has insurance in such amounts and covering such risks and liabilities
as are in accordance with normal industry practice.

     

    SECTION
3.09. Secured,
Super-Priority Obligations. (a) On and after the Closing Date and
pursuant to the Order, the provisions of the Loan Documents are effective to
create in favor of the Lenders, legal, valid and perfected Liens on and security
interests (having the priority provided for herein and in the Order) in all
right, title and interest in the Collateral, enforceable against the
Borrower.

     

    (b)           Pursuant
to the Order, all Obligations will be secured and the Collateral shall be
encumbered by valid and perfected first-position liens and security interests,
subject only to the Requisite Priority.

     

    (c)           Pursuant
to clause (c)(1) of Section 364 of the Bankruptcy Code and the Order, all
obligations of the Borrower under the Loan Documents (including any exposure of
the Lender in respect of cash management or hedging transactions incurred on
behalf of the Borrower) at all times shall constitute allowed super-priority
administrative expense claims in the Bankruptcy Case having priority over all
administrative expenses of the kind specified in clause (b) of Section 503 or
clause (b) of Section 507 of the Bankruptcy Code.

     

    (d)           The
Order and the transactions contemplated thereby and the Transactions
contemplated hereby are in full force and effect and have not been vacated,
reversed, modified, amended or stayed without the prior written consent of the
Lender.

     

    SECTION
3.10. Location of Real
Property and Leased Premises. Schedule 3.10(a) lists completely and
correctly as of the Closing Date all real property owned by the Borrower and the
addresses thereof. Subject to the Bankruptcy Case, the Borrower, as of the
Closing Date, owns in fee all the real property set forth on Schedule 3.10(a).
Schedule 3.10(b) lists completely and correctly as of the Closing Date all
material real property leased by the Borrower and the addresses thereof. Subject
to the Bankruptcy Case, the Borrower, as of the Closing Date has valid leasehold
interests in all the real property set forth on Schedule 3.10(b).

     

    SECTION
3.11. Deposit
Accounts. The only deposit accounts, securities accounts or commodity
accounts maintained by the Borrower on the date hereof are those listed on
Schedule 3.11.

     

    SECTION
3.12  Ownership of
Collateral.  The Borrower owns the Collateral, including,
without limitation, all rights as plaintiff in or as a party to the Litigation
and the right to receive and pay the Litigation Proceeds to the Lenders, each of
which shall be entitled to its proportionate share thereof, in accordance with
the Note, free and clear of liens, claims, and encumbrances, except those claims
properly and timely filed in the Bankruptcy Case, including, without limitation,
claims for the payment of legal fees in connection with the
Litigation.  Notwithstanding the foregoing or anything to the contrary
contained herein or in the Loan Documents, Borrower makes no representation,
warranty or claim as to Debtors’ undisputed ownership rights with respect to the
Intellectual Property that is the subject of the Litigation..


    
      
         


      

      
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    ARTICLE
IV

     

    CONDITIONS OF
LENDING

     

    SECTION
4.01. All Credit
Events.  The obligations of the Lender to make its portion of
the Loan hereunder are subject to the satisfaction of the following conditions
as of the Closing Date (a “Credit
Event”):

     

    (a)           The
representations and warranties set forth in Article III hereof and in each other
Loan Document shall be true and correct in all material respects.

     

    (b)           At
the time of and immediately after such Credit Event, no Event of Default or
Default shall have occurred and be continuing.

     

    (c)           The
Bankruptcy Court shall have issued the Order.

     

    (d)           The
Lender shall have received all fees and other amounts due and payable (to the
extent invoiced) on the Closing Date, including, to the extent invoiced,
reimbursement or payment of all out-of-pocket expenses required to be reimbursed
or paid by the Borrower hereunder or under any other Loan Document.

     

    (e)           This
Agreement and the other Loan Documents shall have been duly executed and
delivered to the Lender by the Borrower and shall be in full force and effect on
the Closing Date. Except as provided in the proviso to the preceding sentence,
the Lender shall have a security interest in the Collateral of the type and
priority described in each Security Document.

     

    (f)
           The Lender
shall have received a copy of, or a certificate as to coverage under, the
insurance policies required by Section 5.02 and the applicable provisions of the
Security Documents, each of which shall be endorsed or otherwise amended to
include a customary lender’s loss payable endorsement and to name the Lender as
additional insured, in form and substance satisfactory to the
Lender.

     

    (g)           There
shall not have occurred any event, circumstance, change, development or effect
that, individually or in the aggregate with all other events, circumstances,
conditions, changes, developments or effects, has had, or would reasonably be
expected to have, a Material Adverse Effect.

     

    (h)           Immediately
after giving effect to the Transactions, the Borrower shall have no Indebtedness
or preferred stock outstanding other than Indebtedness permitted by Section
6.01.

     

    (i)
           The Lenders
shall have executed and delivered to each other the Collateral Agent Agreement,
and the Lenders other than the Lender shall have executed and delivered to the
Borrower duplicate originals of this Agreement and the other Loan
Documents.  Notwithstanding the confidentiality requirements contained
herein, the Borrower shall provide copies of all such duplicate originals to all
Lenders.


    
      
         


      

      
        20

        
          

        

      

      
         


      

    


    ARTICLE
V

     

    AFFIRMATIVE
COVENANTS

    


    The
Borrower covenants and agrees with the Lender that so long as this Agreement and
the Note and other Loan Documents shall remain in effect and until the Lender’s
portion of the Commitment has been terminated and the principal of and interest
on the Loan, all fees and all other expenses or amounts payable under any Loan
Document, shall have been paid in full, unless the Lender shall otherwise
consents in writing, the Borrower will:

     

    SECTION
5.01. Existence;
Businesses and Properties. Except as otherwise excused by the Bankruptcy
Code, do or cause to be done all things necessary to obtain, preserve, renew,
extend and keep in full force and effect all Intellectual Property owned or held
by the Borrower that is the subject of the Litigation or is material to the
conduct of its business.

     

    SECTION
5.02. Insurance. (a) Keep
its insurable properties adequately insured at all times by financially sound
and reputable insurers; maintain such other insurance, to such extent and
against such risks, including fire and other risks insured against by extended
coverage, as is customary with companies in the same or similar businesses
operating in the same or similar locations, including public liability insurance
against claims for personal injury or death or property damage occurring upon,
in, about or in connection with the use of any properties owned, occupied or
controlled by it; and maintain such other insurance as may be required by
law.

     

    (b)           Cause
all such policies covering any Collateral to be endorsed or otherwise amended to
include a customary lender’s loss payable endorsement, in form and substance
reasonably satisfactory to the Lender, which endorsement shall provide that,
from and after the Closing Date, if the insurance carrier shall have received
written notice from the Lender of the occurrence of an Event of Default, the
insurance carrier shall pay all proceeds otherwise payable to the Borrower under
such policies directly to the Lender; cause all such policies to provide that
neither the Borrower, the Lender nor any other party shall be a coinsurer
thereunder and to contain a “Replacement Cost Endorsement”, without any
deduction for depreciation, and such other provisions as the Lender may
reasonably require from time to time to protect its interests; deliver original
or certified copies of all such policies to the Lender; cause each such policy
to provide that it shall not be canceled, modified or not renewed: (i) by reason
of nonpayment of premium upon not less than ten (10) days’ prior written notice
thereof by the insurer to the Lender (giving the Lender the right to cure
defaults in the payment of premiums); or (ii) for any other reason upon not less
than thirty (30) days’ prior written notice thereof from the insurer to the
Lender, delivered prior to the cancellation, modification or non-renewal of any
such policy of insurance, a copy of a renewal or replacement policy (or other
evidence of renewal of a policy previously delivered to the Lender) together
with evidence reasonably satisfactory to the Lender of payment of the premium
therefor.


    
      
         


      

      
        21

        
          

        

      

      
         


      

    


    (c)           Notify
the Lender immediately whenever any separate insurance concurrent in form or
contributing in the event of loss with that required to be maintained under this
Section 5.02 is taken out by the Borrower; and promptly deliver to the Lender a
duplicate original copy of such policy or policies.

     

    SECTION 5.03. Litigation and Other
Notices. Furnish to the Lender prompt written notice of the
following:

     

    (a)           any
Event of Default or Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect
thereto;

     

    (b)           the
occurrence of any ERISA Event that, alone or together with any other ERISA
Events that have occurred, could reasonably be expected to result in liability
of the Borrower in an aggregate amount exceeding $100,000;

     

    (c)           any
development that has resulted in, or could reasonably be expected to result in,
a Material Adverse Effect; and

     

    (d)           from
time to time as requested by Lender, but not more than once each calendar month
through the Loan Fee Maturity Date, a summary report about the status of the
Litigation, which report shall include a summary of the procedural status of the
Litigation and may include notification of  the scheduling of
mediation or arbitration in the Litigation, and any material changes to existing
scheduling orders or trial dates in the Litigation.

     

    SECTION
5.04. Information
Regarding Collateral.  The Borrower agrees promptly to notify
the Lender if any material portion of the Collateral is damaged or
destroyed.

     

    SECTION
5.05. Maintaining
Records/Access to Properties and Inspections. Keep proper books of record
and account in which full, true and correct entries in conformity with GAAP and
all requirements of law are made of all dealings and transactions in relation to
its business and activities. The Borrower will, subject to applicable
confidentiality provisions and applicable privileges, permit any representatives
designated by the Lender to visit and inspect the financial records and the
properties of the Borrower at reasonable times and to make extracts from and
copies of such financial records, and permit any representatives designated by
the Lender to discuss the affairs, finances and condition of the Borrower with
the officers thereof, the independent accountants therefor and any other party
in interest to the Bankruptcy Case.

     

    SECTION
5.06. Use of
Proceeds. Use the proceeds of the Loan only for the purposes set forth in
Section 5.10 hereof.

     

    SECTION
5.07. Further
Assurances. Execute any and all further documents, including the Loan
Documents, financing statements, agreements and instruments, and take all
further action (including filing Uniform Commercial Code and other financing
statements, mortgages and deeds of trust and documents or other instruments with
the United States Patent & Trademark Office and the United States Copyright
Office or any similar foreign registry, as applicable), that the Lender may
reasonably request in order to effectuate the Transactions contemplated by the
Loan Documents and in order to grant, preserve, protect and perfect the validity
and first priority of the security interests created or intended to be created
by the Security Documents.  In the Lender’s discretion, the Lender may
elect to file the Order in lieu of or in addition to UCC-1 financing
statements.  The Borrower and Lender shall promptly complete, execute,
and delivery all of such further documents.


    
      
         


      

      
        22

        
          

        

      

      
         


      

    


    SECTION
5.08. Bankruptcy
Case. The Borrower shall use its best efforts to obtain an order of the
Bankruptcy Court authorizing the Borrower to enter into this Agreement and the
other Loan Documents and deliver or cause to be delivered to the Lender and the
Lender’s counsel all material pleadings, motions and other documents filed on
behalf of all of the Borrower with the Bankruptcy Court.

     

    SECTION
5.09. Bankruptcy Sale
and Auction Process. The Borrower shall keep the Lender informed at all
times of al public information on all matters related to the sale and auction
process of all SCO’s assets under Section 363 of the Bankruptcy
Code.

     

    SECTION
5.10.  Use
of Loan Proceeds/Sale of Core Assets/Use of Proceeds from Sale of Core Asset and
Other Assets.

     

    (a)           Notwithstanding
any other provision hereof or of the other Loan Documents, the Borrower may
deposit up to fifty percent (50%) of the Loan proceeds into a segregated account
to be used to pay past and ongoing Litigation trial costs and litigation related
expenses of the Trustee, including the payment of the reasonable compensation
expense of retaining Messrs. Tibbitts and Broderick, both SCO employees, to
assist in the Litigation.  The remaining fifty percent (50%) of the
Loan proceeds may be used for SCO operational expenses, including, without
limitation, unpaid administration expenses of the SCO Estates in the Trustee’s
discretion.

     

    (b)           The
Borrower may without the prior consent of, but with prior written notice to,
Lender also retain and use fifty percent (50%) of the net proceeds (defined as
gross proceeds from one or more Core Asset Sale(s), less the direct and
reasonable closing fees and expenses of the sale or license transaction) from
any Core Asset Sales and one hundred percent (100%) of the proceeds from the
sale of all other SCO assets (excluding the sale of any rights in the Litigation
and/or any portion of the Litigation proceeds), but the Borrower shall at the
time of any such Core Assets Sale(s) pay the remaining fifty percent (50%) of
such net  sales or license proceeds toward retirement and payment of
the amount due under the Note, other than payment of the Loan
Fee.  Such Note payments shall not be credited toward payment of the
Loan Fee.

     

    (c)           Borrower
shall have the right to use cash collateral arising and existing from Borrower’s
operation of SCO’s business in accordance with the Order, this Agreement and the
other Loan Documents.


    
      
         


      

      
        23

        
          

        

      

      
         


      

    


    ARTICLE
VI

     

    NEGATIVE
COVENANTS

    


    The
Borrower covenants and agrees with the Lender that, so long as this Agreement
shall remain in effect and until the Lender’s portion of the Commitment has been
terminated and the principal of and interest on the Loan, all fees and all other
expenses or amounts payable under any Loan Document have been paid in full,
unless the Lender shall otherwise consent in writing, the Borrower will
not:

     

    SECTION
6.01. Indebtedness. Incur,
create, assume or permit to exist any secured Indebtedness, except:

     

    (a)           Indebtedness
of the Borrower existing on the date hereof and set forth on Schedule
6.01;

     

    (b)           Indebtedness
created hereunder and under the other Loan Documents;

     

    (c)           Indebtedness
under performance bonds or with respect to workers’ compensation claims, in each
case incurred in the ordinary course of business; and

     

    (d)           Indebtedness
from the Lender pursuant to Section 6.13 hereof.

     

    SECTION
6.02. Liens.
Create or incur any Lien on any of the Collateral or on any property or assets
(including Equity Interests or other securities of any Person) now owned or
hereafter acquired by the Borrower or on any income or revenues or rights in
respect of any thereof of the Borrower, except the following (subject (except
with respect to (b) below) at all times to the Requisite Priority requirements
of this Agreement):

     

    (a)           Liens
existing on the date hereof and as set forth in Schedule 6.02; provided that
such Liens shall secure only those obligations which they secure on the date
hereof;

     

    (b)           any
Lien created under the Loan Documents;

     

    (c)           carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business and securing obligations that are not
due and payable or which are being contested in compliance with Section
5.03;

     

    (d)           pledges
and deposits in compliance with workmen’s compensation, unemployment insurance
and other social security laws or regulations;

     

    (e)           deposits
to secure the performance of bids, trade contracts (other than for Indebtedness
for borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

     

    (f)
           except in
connection with any Core Asset Sale(s), non-exclusive licenses of Intellectual
Property incurred in the ordinary course of business which, in the aggregate,
are not substantial in amount and do not materially detract from the value of
the property subject thereto or materially interfere with the ordinary conduct
of the business of the Borrower;


    
      
         


      

      
        24

        
          

        

      

      
         


      

    


    (g)           judgment
liens securing judgments that have not resulted in an Event of Default under
Article VII;

     

    (h)          any
interest or title of a lessor under any lease entered into by the Borrower in
the ordinary course of business and covering only the assets so leased;
and

     

    (i)          
 Liens in respect of indebtedness permitted by Section
6.01(d).

     

    Until the Loan (other than the Loan
Fee, which shall be paid solely from the Litigation Proceeds) is repaid in full,
the priority of the Lender’s liens and security interests contemplated by this
Agreement and granted under the Loan Documents shall remain as first-position
and first-priority liens, subject to the Requisite Priority.  Further,
the Borrower agrees that it shall not take any action, make any motion or
request of the Bankruptcy Court, make any verbal or other agreement, or engage
in any omission that will result in a decision from the Bankruptcy Court that
will cause the Lender to lose such first-position or first-priority of its liens
and security interests against all or any portion of the Collateral, unless and
until the Loan is repaid in full.

     

    SECTION
6.03. Sale and
Leaseback Transactions. Except for Core Asset Sales and the other sales
of SCO assets permitted hereunder, enter into any arrangement, directly or
indirectly, with any Person whereby it shall sell or transfer any property, real
or personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property which it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred.

     

    SECTION
6.04. Investments,
Loans and Advances.  Purchase, hold, or acquire any Equity
Interests, evidences of Indebtedness or other securities.

     

    SECTION
6.05. Mergers,
Consolidations, Sales of Assets and Acquisitions. Except for one or more
Core Asset Sales: (a) merge into or consolidate with any other Person, or permit
any other Person to merge into or consolidate with it, or sell, transfer, lease,
license, abandon, cancel, permit to lapse, or otherwise dispose of (in one
transaction or in a series of transactions) all or substantially all of the
assets (whether now owned or hereafter acquired) of the Borrower), or purchase,
lease or otherwise acquire (in one transaction or a series of transactions) all
or any substantial part of the assets of any other Person, except that: (i) the
Borrower may purchase and sell inventory, and license its Intellectual
Property,  in the ordinary course of business; and (ii) if at the time
thereof and immediately after giving effect thereto no Event of Default or
Default shall have occurred and be continuing, any Wholly Owned Subsidiary may
merge into or consolidate with the Borrower in a transaction in which the
Borrower is the surviving corporation and in which no Person other than the
Borrower receives any consideration.  Notwithstanding the foregoing
restriction on the sale of any assets of the Borrower, the Lender hereby
consents to the sale of any and all assets of the Borrower, except for the
Borrower’s claims and rights related to the Litigation and the Litigation
Proceeds; or

     

    (b)           Notwithstanding
and in addition to any other provision and/or restriction contained in this
Agreement or in the other Loan Documents, the Borrower shall not have the right
to sell or further encumber all or any portion of its rights in the Litigation
or in the Litigation Proceeds, but this restriction shall not prevent the
Borrower from obtaining additional financing in accordance with and subject to
the restriction set forth in Section 6.13 hereof, so long as no liens or
encumbrances are created in connection with such addition
financing.


    
      
         


      

      
        25

        
          

        

      

      
         


      

    


    SECTION
6.06. Restricted
Payments; Restrictive Agreements.  (a) Declare or make, or
agree to declare or make, directly or indirectly, any Restricted Payment, or
incur any obligation (contingent or otherwise) to do so; provided, however, that
the Borrower may provide reasonable compensation, customary employee benefit
arrangements and indemnities for their respective directors and officers
consistent with past practices or as otherwise approved by the Bankruptcy Court
or otherwise approved in writing by the Lender.

     

    (b)           Enter
into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon the ability of the Borrower
to create, incur or permit to exist any Lien upon any of its property or assets
to secure the Obligations or any refinancing thereof, or; provided that: (A) the
foregoing shall not apply to restrictions and conditions imposed by law or by
any Loan Document as in effect on the date hereof; (B) the foregoing shall not
apply to restrictions or conditions imposed by any agreement relating to secured
Indebtedness, in each case permitted by this Agreement, if such restrictions or
conditions apply only to the property or assets securing such Indebtedness or
subject to such lease; and (C) the foregoing shall not apply to customary
provisions in leases and other contracts restricting the assignment
thereof..

     

    SECTION
6.07. Transactions
with Affiliates. Sell or transfer any property or assets to, or purchase
or acquire any property or assets from, or otherwise engage in any other
transactions with, any of its Affiliates, except that:

     

    (a)           the
Borrower may engage in any of the foregoing transactions in the ordinary course
of business;

     

    (b)           Restricted
Payments may be made to the extent provided in Section 6.06; and

     

    (c)           loans
may be made and other transactions may be entered into between and among the
Borrower and its Affiliates in the ordinary course of its business or to the
extent permitted by Sections 6.01 and 6.04.

     

    SECTION
6.08. Business of
Borrower. Engage at any time in any business or business activity other
than the business currently conducted by it and reasonable extensions thereof
and business activities reasonably incidental thereto.

     

    SECTION
6.09. Other
Indebtedness and Agreements. (a) Permit any waiver, supplement,
modification, amendment, termination or release of any indenture, instrument or
agreement pursuant to which any Material Indebtedness of the Borrower is
outstanding if the effect of such waiver, supplement, modification, amendment,
termination or release would increase the obligations of the obligor or confer
additional material rights on the holder of such Indebtedness in a manner
materially adverse to the Borrower or the Lender, unless such amended Material
Indebtedness could be incurred under Section 6.01.


    
      
         


      

      
        26

        
          

        

      

      
         


      

    

    (b)           (i)
Make any distribution, whether in cash, property, securities or a combination
thereof, in respect of, or pay, or offer or commit to pay, or directly or
indirectly redeem, repurchase, retire or otherwise acquire for consideration, or
set apart any sum for the aforesaid purposes, notes or any subordinated
Indebtedness (other than inter-company subordinated Indebtedness); or (ii) pay
in cash any amount in respect of any Indebtedness or preferred Equity Interests
that may at the obligor’s option be paid in kind or in other
securities.

     

    (c)           Unless
consented to by the Lender (such consent not to be unreasonably withheld) and
approved by the Bankruptcy Court, make any payment, whether in cash, property,
securities or a combination thereof, to compromise or settle any proceeding
listed on Schedule 3.05 for an amount less than sufficient to pay the Loan in
full, or any other material litigation or proceeding.

     

    SECTION
6.10. Capital
Expenditures. Permit any additional Capital Expenditures by the Borrower
from the Closing Date until the Loan Fee Maturity Date, without the written
consent of the Lender, which shall not be unreasonably withheld.

     

    SECTION
6.11. Chapter 11
Claims. Incur, create, assume or permit to exist any administrative
expense, unsecured claim, or other super-priority claim or lien that is pari
passu with or senior to the claims of the Lender against the
Borrower.

     

    SECTION
6.12. The
Order. Make or permit to be made any change, amendment or modification,
or any application or motion for any change, amendment or modification, to the
Order without the prior written consent of the Lender, except for any change,
amendment or modification that would not adversely affect the
Lender.

     

    SECTION
6.13. Right of First
Refusal for Additional Indebtedness.  The Borrower has agreed
to certain restrictions set forth herein with respect to incurring additional
Indebtedness herein.  Should the Borrower incur additional
Indebtedness from another Person other than the Lender on terms that are more
expensive than the terms of the Loan hereunder, then the terms of the Loan shall
be automatically modified and increased to be equal to the terms of such
additional Indebtedness.  In connection with and as result of
obtaining such additional Indebtedness and in connection with any other covenant
or agreement of the Borrower with any third party or parties, Lender’s right to
receive the Loan Fee from the Litigation Proceeds shall not be diluted or
otherwise reduced or diminished.

     

    
      
        
           


        

        
          27

          
            

          

        

        
           


        

      

    

     

    ARTICLE
VII


     

    EVENTS OF
DEFAULT

     

    In case
of the happening of any of the following events (each, an “Event of Default” and
together, “Events of
Default”):


    (a)           any
representation or warranty made or deemed made in or in connection with any Loan
Document or the borrowings hereunder, or any representation, warranty, statement
or information contained in any report, certificate, financial statement or
other instrument furnished in connection with or pursuant to any Loan Document,
shall prove to have been false or misleading in any material respect when so
made, deemed made or furnished;

     

    (b)           default
shall be made in the payment of any principal of any Loan when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or by acceleration thereof or otherwise;

     

    (c)           default
shall be made in the payment of any Basic Interest or Default Interest on any
Loan or any fee or any other amount (other than an amount referred to in (b)
above) due under any Loan Document, when and as the same shall become due and
payable, and such default shall continue unremedied for a period of five
Business Days after Borrower receives such notice;

     

    (d)           default
shall be made in the due observance or performance by the Borrower of any
covenant, condition or agreement contained in: (i) Section 5.03(a) or (c), and
such failure shall continue unremedied for five (5) Business Days; or (ii)
Sections 5.04, 5.06, 5.10 or Article VI, and such default shall remain
unremedied for a period of ten (10) Business Days;

     

    (e)           default
shall be made in the due observance or performance by the Borrower of any
covenant, condition or agreement contained in any Loan Document (other than
those specified in (b), (c) or (d) above) and such default shall continue
unremedied for a period of thirty (30) days after notice thereof from the Lender
to the Borrower;

     

    (f)           the
Borrower shall fail to pay any principal, Basic Interest or Default Interest or
any other amount due under any Loan, regardless of amount, or any other amount
due in respect of any Indebtedness arising after the Petition Date (other than
the Obligations), when and as the same shall become due and
payable;

     

    (g)           an
ERISA Event shall have occurred that, in the opinion of the Lender, when taken
together with all other such ERISA Events, could reasonably be expected to
result in liability of the Borrower and its ERISA Affiliates in an aggregate
amount exceeding $100,000;

     

    (h)           (i)
The Loan Documents and the Order shall, for any reason, cease to create a valid
Lien on any of the Collateral purported to be covered thereby or such Lien shall
cease to be a perfected Lien having the priority provided herein pursuant to
Section 364 of the Bankruptcy Code against the Borrower, or the Borrower shall
so allege in any pleading filed in any court or any material provision of any
Loan Document shall, for any reason, cease to be valid and binding on the
Borrower or the Borrower shall so state in writing; or (ii) the Borrower shall
file a complaint or initiate any other action against the Lender or any entity
shall obtain a judgment that affects the Lender’s claims or the Collateral,
except to the extent expressly allowed in the Order;


    
      
         


      

      
        28

        
          

        

      

      
         


      

    

     

    (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 any such relief; or an application shall be filed by the Borrower for
the approval of, or there shall arise: (i) any other claim having priority
senior to or pari passu with the claims of the Lender under the Loan Documents
or any other claim having priority over any or all administrative expenses of
the kind specified in clause (b) of Section 503 or clause (b) of Section 507 of
the Bankruptcy Code or the additional Indebtedness permitted hereunder; or (ii)
any Lien on the Collateral having a priority senior to or pari passu with the
Liens and security interests granted herein, except as expressly provided
herein;

     

    (j)           The
Trustee resigns, is removed, becomes incapacitated or otherwise
becomes  unable to perform his duties under the Bankruptcy Code and a
new Trustee not reasonably acceptable to Lender is appointed by the Bankruptcy
Court;

     

    (k)           (i)
the Order shall: (i) not have been entered by the Bankruptcy Court on or before
the thirtieth (30th) day following the Closing Date; (ii) from and after the
date of entry thereof, the Order shall cease to be in full force and effect;
(iii) the Borrower shall fail to comply with the terms of the Order in any
material respect; or (iv) the Order shall be amended, supplemented, stayed,
reversed, vacated or otherwise modified (or the Borrower shall apply for
authority to do so) without the written consent of the Lender in a manner that
has a Material Adverse Effect on Lender and/or not provided for in this
Agreement and/or the other Loan Documents;

     

    (l)           the
Borrower shall file a motion seeking, or the Bankruptcy Court shall enter, an
order: (i) granting relief from the automatic stay applicable under Section 362
of the Bankruptcy Code to any holder of any security interest to permit
foreclosure on any assets; or (ii) except to the extent the same would not
constitute a Default hereunder, approving any settlement or other stipulation
with any creditor of the Borrower, other than the Lender without the Lender’s
consent, which shall not be unreasonably withheld;

     

    (m)          claims
arising under Section 506(c) of the Bankruptcy Code shall be asserted against
the Lender by the Borrower or other actions adverse to the Lender or its rights
and remedies hereunder or under any other Loan Document or any Bankruptcy Court
order shall be commenced by the Borrower;

     

    (n)           after
the Effective Date, there shall occur any event or circumstances (or series of
events or circumstances) that has a Material Adverse Effect in the aggregate
since the Effective Date;

     

    (o)           the
Borrower shall consummate a sale or license of all or substantially all of SCO
Assets without the consent of the Lender not otherwise permitted by this
Agreement; or


    
      
         


      

      
        29

        
          

        

      

      
         


      

    


    (p)           the
Litigation Proceeds are not sufficient to repay the Loan Fee in full on or
before the Loan Fee Maturity Date and all other amounts owed to creditors with
rights senior to those held by the Lender hereunder and under the Loan
Documents,

     

    then,
during the continuance of any Event of Default, without further order of,
application to, or action by, the Bankruptcy Court, the Lender: (a) may by
notice to the Borrower declare that all the Lender’s portion of the Commitment
be terminated, whereupon any and all obligations of the Lender to make a portion
of the Loan shall immediately terminate; and (b) may by notice to the Borrower,
declare the Loan, all Basic Interest and Default Interest owed thereon and all
other amounts and Obligations payable under this Agreement in respect thereof to
be forthwith due and payable, whereupon the Loan, all such interest and all such
amounts and Obligations, shall become and be forthwith due and payable, without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Borrower. In addition, subject solely to any
requirement of the giving of notice by the terms of the Order, the Debtor shall
have a period of five (5) business days in which to either cure the Default or
obtain a scheduled court hearing with regard to the default.  In the
event the Debtor fails to either cure the Default or obtain a scheduled court
hearing with regard to 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.  Notwithstanding the foregoing provisions, upon the
occurrence of an Event of Default, the Borrower shall have the right to use any
cash available at such time for the payment of its fees and administrative
expenses.

     

    ARTICLE
VIII


     

    MISCELLANEOUS

    


    SECTION
8.01. Notices.
Notices and other communications provided for herein shall be in writing and
shall be delivered by hand or overnight courier service, mailed by certified or
registered mail or sent by fax, as follows:

     

    
      
        	
                If
      to the Borrower, to it at

              	
                Edward
      N. Cahn,

              
	 
      	
                Blank
      Rome LLP

              
	 
      	
                7535
      Windsor Drive Suite 200

              
	 
      	
                Allentown,

              
	 
      	 
      
	
                With
      a copy to:

              	
                Bonnie
      G. Fatell, Esquire

              
	 
      	
                Blank
      Rome LLP

              
	 
      	
                1201
      Market  Street, Suite 800

              
	 
      	
                Wilmington,
      DE 19801

              
	 
      	 
      
	
                If
      to the Lender, to them at

              	
                ______________________

              
	 
      	
                ______________________

              
	 
      	
                ______________________

              


      

    


    
      
         


      

      
        30

        
          

        

      

      
         


      

    

    


    
      
        	
                With
      a copy to:

              	
                Holland
      & Hart LLP

              
	 
      	
                60
      East South Temple

              
	 
      	
                Suite
      2000

              
	 
      	
                Salt
      Lake City, Utah 84111

              
	 
      	
                Attn:  Mona
      L. Burton

              
	 
      	 
      
	 
      	
                and

              
	 
      	 
      
	 
      	
                Holland
      & Hart LLP

              
	 
      	
                222
      South Main

              
	 
      	
                Suite
      2200

              
	 
      	
                Salt
      Lake City, Utah 84111

              
	 
      	
                Attn:  Mona
      L. Burton

              


      

    

    


    All
notices and other communications given to any party hereto in accordance with
the provisions of this Agreement shall be deemed to have been given on the date
of receipt if delivered by hand or overnight courier service or sent by fax or
on the date five Business Days after dispatch by certified or registered mail if
mailed, in each case delivered, sent or mailed (properly addressed) to such
party as provided in this Section 8.01 or in accordance with the latest
unrevoked direction from such party given in accordance with this Section 8.01.
Any party hereto may change its address for notices by giving notice of such
change to each party hereto in accordance with this Section 8.01. In addition,
the Lender and the Borrower may agree from time to time that notices hereunder
for certain specified purposes may be delivered by e-mail, in which case such
notices will be as effective as if delivered by fax.

     

    SECTION
8.02. Survival of
Agreement. All covenants, agreements, representations and warranties made
by the Borrower herein and in the certificates or other instruments prepared or
delivered in connection with or pursuant to this Agreement or any other Loan
Document shall be considered to have been relied upon by the Lender and shall
survive the making by the Lender of its portion of the Loan, regardless of any
investigation made by the Lender or on its behalf, and shall continue in full
force and effect as long as the principal of or any accrued Basic Interest and
Default Interest owed on any Loan or any fee or any other amount payable under
this Agreement or any other Loan Document is outstanding and unpaid and so long
as the Lender’s portion of the Commitment has not been terminated. The
obligation to pay the Loan Fee and the provisions of Section 8.05 hereof shall
remain operative and in full force and effect regardless of the expiration of
the term of this Agreement, the consummation of the Transactions contemplated
hereby, the repayment of the Loan, the expiration of the Lender’s portion of the
Commitment, the invalidity or unenforceability of any term or provision of this
Agreement or any other Loan Document.

     

    SECTION
8.03. Binding
Effect. This Agreement shall become effective in accordance with the
terms set forth herein and shall bind and inure to the benefit of the parties
hereto and of their respective successors and assigns, to the extent any such
assignment is expressly permitted hereunder.


    
      
         


      

      
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    SECTION
8.04. Successors and
Assigns. (a) Whenever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the permitted successors
and assigns of such party; and all covenants, promises and agreements by or on
behalf of the Borrower and the Lender that are contained in this Agreement shall
bind and inure to the benefit of their respective successors and
assigns.

     

    (b)           The
Lender may assign to one or more assignees all or a portion of its interests,
rights and obligations under this Agreement (including all or a portion of its
Commitment and its portion of the Loan at the time owing to it).

     

    (c)           The
Lender may without the consent of the Borrower sell participations to one or
more banks or other entities in all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loan
owing to it); provided, however, that: (i) the Lender’s obligations under this
Agreement shall remain unchanged; (ii) the Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations;
(iii) the participating banks or other entities shall be entitled to the benefit
of the protections given to the Lender hereunder and shall be bound by the
confidentiality provisions contained in Section 8.16 hereof to the same extent
as if they were the Lender; and (iv) the Borrower shall continue to deal solely
and directly with the Lender in connection with the Lender’s rights and
obligations under this Agreement, and the Lender shall retain the sole right to
enforce the obligations of the Borrower relating to the Loan and to approve any
amendment, modification or waiver of any provision of this Agreement (other than
amendments, modifications or waivers decreasing any fees payable to such
participating bank or Person hereunder or the amount of principal of or the rate
at which interest is payable on the Loan in which such participating bank or
Person has an interest, extending any scheduled principal payment date or date
fixed for the payment of interest on the Loan in which such participating bank
or Person has an interest, increasing or extending the Commitment of such
participating bank or Person or releasing all or substantially all of the
Collateral). All amounts payable by the Borrower to the Lender hereunder in
respect of any Loan and the applicability of the protection provisions contained
herein shall be determined as if the Lender had not sold or agreed to sell any
participation in the Loan, and as if the Lender were funding the participated
portion of the Loan the same way that it is funding the portion of the Loan in
which no participation has been sold.

     

    (d)           The
Lender or participant may, in connection with any assignment or participation or
proposed assignment or participation pursuant to this Section 8.04, disclose to
the assignee or participant or proposed assignee or participant any information
relating to the Borrower furnished to the Lender by or on behalf of the
Borrower; provided that, prior to any such disclosure of information designated
by the Borrower as confidential, each such assignee or participant or proposed
assignee or participant shall execute an agreement whereby such assignee or
participant shall agree (subject to customary exceptions) to preserve the
confidentiality of such confidential information on terms no less restrictive
than those applicable to the Lender pursuant to Section 8.15.


    
      
         


      

      
        32

        
          

        

      

      
         


      

    


    (e)           The
Lender may at any time assign all or any portion of its rights under this
Agreement to secure extensions of credit to the Lender or in support of
obligations owed by the Lender; provided that no such assignment shall release
the Lender from any of its obligations hereunder or substitute any such assignee
for the Lender as a party hereto. If the Lender is a fund that invests in bank
loans it may (without the consent of the Borrower) pledge all or any portion of
its rights in connection with this Agreement to the trustee for holders of
obligations owed, or securities issued, by such fund as security for such
obligations or securities, provided that any foreclosure or other exercise of
remedies by such trustee shall be subject to the provisions of this Section 8.04
regarding assignments in all respects. No pledge described in the immediately
preceding sentence shall release such Lender from its obligations
hereunder.

     

    (f)           The
Borrower shall not assign or delegate any of its rights or duties hereunder
without the prior written consent of the Lender, which the Lender may grant or
withhold in its sole discretion, and any attempted assignment without such
consent shall be null and void.

     

    SECTION
8.05. Expenses;
Indemnity. (a) The Borrower agrees to pay all reasonable out-of-pocket
expenses, incurred by the Lender and its Affiliates in connection with the
consummation of the Transactions contemplated hereby and the preparation and
administration of this Agreement and the other Loan Documents or in connection
with any amendments, modifications or waivers of the provisions hereof or
thereof (whether or not the Transactions hereby or thereby contemplated shall be
consummated) or incurred by the Lender in connection with the enforcement or
protection of its rights in connection with this Agreement and the other Loan
Documents or in connection with the Loan made hereunder (including, with respect
to this Section 8.05(a), the reasonable fees, charges and disbursements of
Holland & Hart LLP, counsel for the Lender and, in connection with any such
enforcement or protection, the fees, charges and disbursements of any other
counsel for the Lender); provided, however, that the Lenders’ legal fees for the
preparation and consummation of the transaction contemplated by this Agreement
and the other Loan Documents and for preparation and consummation of the
duplicate originals of the Loan Documents between the other Lenders and the
Borrower shall be capped at $50,000.00.  If, however, such aggregate
legal fees exceed such $50,000.00 cap, such excess legal fees shall be paid from
the Litigation Proceeds and shall be in addition and shall not be a part of the
payment of the Loan Fee.

     

    (b) The
Borrower agrees to indemnify the Lender and each Related Lender Party of any of
the foregoing Persons (each such Person being called an “Indemnitee”) against,
and to hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable counsel fees, charges and
disbursements, incurred by or asserted against any Indemnitee arising out of, in
any way connected with, or as a result of: (i) the execution or delivery of this
Agreement or any other Loan Document or any agreement or instrument contemplated
thereby, the performance by the parties thereto of their respective obligations
thereunder or the consummation of the Transactions contemplated thereby
(including the Bankruptcy Case); (ii) the use of the proceeds of the Loan; or
(iii) any claim, litigation, investigation or proceeding relating to any of the
foregoing, whether or not any Indemnitee is a party thereto (and regardless of
whether such matter is initiated by a third party or by the Borrower or any of
its Affiliates); provided that such indemnity shall not, as to any Indemnitee,
be available to the extent that such losses, claims, damages, liabilities or
related expenses are determined by a court of competent jurisdiction by final
and non-appealable judgment to have resulted from the gross negligence or
willful misconduct of such Indemnitee.


    
      
         


      

      
        33

        
          

        

      

      
         


      

    


    (c)           To
the extent permitted by Applicable Law, the Borrower shall not assert, and
hereby waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions
contemplated hereby (including the Bankruptcy Case), any Loan or the use of the
proceeds thereof.

     

    (d)           The
provisions of this Section 8.05 shall remain operative and in full force and
effect regardless of the expiration of the term of this Agreement, the
consummation of the Transactions contemplated hereby, the repayment of the Loan,
the expiration of the Commitment, the invalidity or unenforceability of any term
or provision of this Agreement or any other Loan Document, or any investigation
made by or on behalf of the Lender. All amounts due under this Section 8.05
shall be payable on written demand therefor.

     

    SECTION
8.06. Applicable
Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN AS EXPRESSLY
SET FORTH IN OTHER LOAN DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAWS OF THE STATE OF DELAWARE.

     

    SECTION
8.07. Waivers;
Amendment. (a) No failure or delay of the Lender in exercising any power
or right hereunder or under any other Loan Document shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right or power, or
any abandonment or discontinuance of steps to enforce such a right or power,
preclude any other or further exercise thereof or the exercise of any other
right or power. The rights and remedies of the Lender hereunder and under the
other Loan Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of this
Agreement or any other Loan Document or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by
Section 8.07(b) below, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given. No notice or
demand on the Borrower in any case shall entitle the Borrower to any other or
further notice or demand in similar or other circumstances.

     

    (b)           Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
Borrower and the Lender.


    
      
         


      

      
        34

        
          

        

      

      
         


      

    


    SECTION
8.08. Interest Rate
Limitation. Notwithstanding anything herein to the contrary, if at any
time the Basic Interest and the Default Interest rates applicable to the Loan,
together with all fees, charges and other amounts which are treated as interest
on the Loan under Applicable Law (collectively the “Charges”), shall
exceed the maximum lawful rate (the “Maximum Rate”) which
may be contracted for, charged, taken, received or reserved by the Lender
holding a portion of the Loan in accordance with Applicable Law, the rate of
Basic Interest and Default Interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section 8.08 shall be cumulated and the interest and Charges
payable to the Lender in respect of other loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the annual interest rate of fourteen percent (14%) to
the date of repayment, shall have been received by the Lender.

     

    SECTION
8.09. Entire
Agreement. This Agreement and the other Loan Documents constitute the
entire contract between the parties relative to the subject matter hereof. Any
other previous agreement among the parties with respect to the subject matter
hereof is superseded by this Agreement and the other Loan Documents. Nothing in
this Agreement or in the other Loan Documents, expressed or implied, is intended
to confer upon any Person (other than the parties hereto and thereto, their
respective successors and assigns permitted hereunder and, to the extent
expressly contemplated hereby, the Related Parties of the Lender) any rights,
remedies, obligations or liabilities under or by reason of this Agreement or the
other Loan Documents.

     

    SECTION
8.10. Waiver Of Jury
Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED
BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH PARTY HERETO: (a)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; AND (b) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 8.10.

     

    SECTION
8.11. Severability. In the
event any one or more of the provisions contained in this Agreement or in any
other Loan Document should be held invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein and therein shall not in any way be affected or impaired
thereby (it being understood that the invalidity of a particular provision in a
particular jurisdiction shall not in and of itself affect the validity of such
provision in any other jurisdiction). The parties shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.

     

    SECTION
8.12. Counterparts. This
Agreement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original but all of
which when taken together shall constitute a single contract, and shall become
effective as provided in Section 8.01 hereof. Delivery of an executed signature
page to this Agreement by facsimile transmission or electronic mail shall be
deemed originals for all purposes and shall be as effective as delivery of a
manually signed counterpart of this Agreement.


    
      
         


      

      
        35

        
          

        

      

      
         


      

    


    SECTION
8.13. Headings.
Article and Section headings and the Table of Contents used herein are for
convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.

     

    SECTION
8.14. Jurisdiction;
Consent to Service of Process. (a) The Borrower and Lender each hereby
irrevocably and unconditionally submits, for itself and its property, to the
exclusive jurisdiction of the Bankruptcy Court and any appellate court
therefrom, in any action or proceeding arising out of or relating to this
Agreement or the other Loan Documents, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such Bankruptcy Court or, to the extent permitted by law, in
such federal court.  Each of the parties hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. The Lender waives any right it may otherwise have to bring any
action or proceeding relating to this Agreement or the other Loan Documents
against the Borrower or its respective properties in the courts of any other
jurisdiction.

     

    (b)           The
Borrower and Lender each hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or the other Loan Documents in the
Bankruptcy Court). Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.

     

    (c)           Each
party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 8.01. Nothing in this Agreement will affect the
right of any party to this Agreement to serve process in any other manner
permitted by law.

     

    SECTION
8.15. Confidentiality
. The Lender agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed: (a) to its and its
Affiliates’ officers, directors, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential); (b) to the
extent requested by any regulatory authority or quasi-regulatory authority (such
as the National Association of Insurance Commissioners); (c) to the extent
required by Applicable Law or by any subpoena or similar legal process
(including, in each case, in respect of the Bankruptcy Case); (d) in connection
with the exercise of any remedies hereunder or under the other Loan Documents or
any suit, action or proceeding relating to the enforcement of its rights
hereunder or thereunder; (e) subject to an agreement containing provisions
substantially the same as those of this Section 8.15 to: (i) any actual or
prospective assignee of or participant in any of its rights or obligations under
this Agreement and the other Loan Documents; or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower or any of its obligations; (f) with the consent of the Borrower; or
(g) to the extent such Information becomes publicly available other than as a
result of a breach of this Section 8.15. For the purposes of this Section,
“Information”
means all information received from the Borrower and related to the Borrower or
its business, other than any such information that was available to the Lender
on a non-confidential basis prior to its disclosure by the Borrower; provided
that, in the case of Information received from the Borrower after the date
hereof, such information is clearly identified at the time of delivery as
confidential or such information is of such a nature that a prudent person would
expect such information to be confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section 8.15 shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord its own confidential
information.


    
      
         


      

      
        36

        
          

        

      

      
         


      

    


    SECTION
8.16.  Collateral Agent
Agreement.  The Borrower acknowledges and agrees that the
Lender, as Agent and alone, shall have the right to enforce all Lenders’ rights
relating to the Collateral under the Loan Documents and under duplicate
originals of all of the Loan Documents executed by the Lenders other than the
Lender.  This provision shall not be included in such duplicate
originals of the Loan Documents executed by the Lenders other than the
Lender.

     

    SECTION
8.17 Other
Provisions.   Notwithstanding  anything to the
contrary in this Agreement or the other Loan Documents, the following overriding
understandings and agreements shall prevail in the interpretation  and
enforcement of the intent of this Agreement and the other Loan
Documents:

     

    (a)           Nothing
herein shall cause or result in any personal liability to be imposed on the
Trustee individually beyond the duties of a trustee under Applicable Law in the
Bankruptcy Case.  The Trustee has no personal liability, and the
Lender hereby releases the Trustee from all personal liability, with respect to
his payment of any monetary obligations related to the Loan or the covenants in
the Loan Documents and/or related to any representations or warranties made
herein or in any of the other Loan Documents.  This provision is not
intended to relieve the Trustee from performance of any and all of the
obligations under this Agreement and the other Loan Documents in his capacity as
trustee of the Estates.

     

    (b)           Other
than Lender’s rights expressly set forth herein and in the other Loan Documents,
as the same may be enforced in accordance with Applicable Law, the Lender does
not have any right to interfere with or participate in the conduct or
prosecution of the Litigation or to participate in or approve any settlement of
the Litigation.

     

    (c)           The
Lenders’ rights to and in the Collateral are subject to the Lenders’ actual
disbursement of the Loan proceeds to the Borrower hereunder on the Closing Date;
provided however, that if after execution of this Agreement the Borrower fails
to obtain the Order contemplated by this Agreement, the Borrower shall pay
Lender’s expenses up to a maximum of $50,000.00, subject to the payment of
additional Lender legal fees in the manner set forth in Section 8.05(a)
hereof.  In addition, if for any reason the amount of the Loan is less
than Eight Hundred Thousand and 00/100 Dollars ($800,000.00), Borrower may, in
its discretion, either elect to waive such minimum Loan amount requirement and
close the Transactions, or Borrower may elect not to close the Transactions, in
which event Borrower shall nonetheless pay Lender’s legal fees, subject to the
foregoing $50,000.00 cap.


    
      
         


      

      
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    IN
WITNESS WHEREOF, the parties to this Agreement have executed it as of the date
set forth on the cover page of this Agreement.


     

    
      
        	
                BORROWER:

              	
                ________________________________

              
	 
      	
                EDWARD
      N. CAHN, Solely in His Capacity as Trustee of the Bankruptcy Estates of
      The SCO Group, Inc. and SCO Operations, Inc., both Delaware
      corporations

              
	 
      	 
      
	
                LENDER:

              	 
      
	 
      	
                ______________________

              
	 
      	 
      
	 
      	
                By:_____________________________

              
	 
      	
                Name:___________________________

              
	 
      	
                Title:____________________________

              


      

    


    
      
         


      

      
        38

        
          

        

      

      
         


      

    

     

    EXHIBIT
“A”

     

    
      COLLATERAL AGENT
AGREEMENT

      


      THIS
COLLATERAL AGENT AGREEMENT (the “Agreement”) is made
as of the Effective Date, between Seung Ni Capital Partners, L.L.C., a Utah
limited liability company (“Collateral Agent”),
and the lenders listed on Exhibit “A” hereto
(each, a “Lender” and
collectively, the “Lenders”), and The
Bankruptcy Estates of The SCO Group, Inc., a Delaware corporation and SCO
Operations, Inc., a Delaware corporation, by and through Edward N.Cahn solely in
his capacity as Chapter 11 trustee (“Borrower”), and this
Agreement is executed in connection with the following facts:

       

      RECITALS:

       

      A.          Each
Lender, including Collateral Agent, has entered into a duplicate original with
Borrower of that certain Credit Agreement, of even date herewith (each, the
“Credit
Agreement”), under which Collateral Agent, as one of the Lenders, has
agreed to extend a portion of the Loan, as defined in the Credit Agreement, to
Borrower.  Except where the context otherwise requires herein, the
term “Lenders”
used herein shall include the Collateral Agent.

       

      B.           The
Lenders have entered into duplicate originals of the Credit Agreement and
certain exhibit agreements attached thereto under which each Lender has agreed
to extend a portion of the Loan to Borrower.  Each of the Lenders,
thus, has rights and obligations with vis a vis the Borrower and the making each
Lender’s portion of the Loan and vis a vis enforcement of the Loan Documents
against the Borrower, except as set forth in this Agreement.

       

      C.           The
Loan Documents create certain security interests in the Collateral in each of
the Lender’s favor for the purpose of securing Borrower’s repayment of the
Loan.  The Lenders’, including Collateral Agent’s, desire to designate
and appoint a third party to act as the collateral agent on all of the Lenders’
collective behalf with respect to the Collateral, as more fully set forth in
this Agreement.

       

      D.           Collateral
Agent is willing to act without compensation as the collateral agent for such
purposes in accordance with the terms and conditions of this
Agreement.

       

      NOW,
THEREFORE, for good and valuable consideration, receipt of which is hereby
acknowledged, Borrower, Lenders, and Collateral Agent hereby agree as
follows:

       

      1.           Recitals.  The
parties hereto acknowledge the accuracy of the Recitals and hereby incorporate
the foregoing Recitals into this Agreement.

       

      2.           Definitions.  Except
as defined in this Agreement, each capitalized term appearing herein shall have
the meaning ascribed or given to it in the Credit Agreement.

       

      
        
           


        

        
          
          

          
            

          

        

        
           


        

      


      3.           Appointment of Collateral
Agent.  Each of the Lenders acknowledges that it has read and
entered into the Credit Agreement and the other Loan
Documents.  Effective Immediately and by signing this Agreement, each
of the Lenders hereby irrevocably and unconditionally appoints Collateral Agent
to serve as collateral agent for all of the Lenders and irrevocably appoints and
authorizes Collateral Agent to act as agent for all of the Lenders for the
purpose of: (a) executing, filing, and/or delivering such documents and
agreements as are necessary or desirable to perfect the security interests
granted to each Lender in the Collateral under duplicate originals and versions
of the Loan Documents; and (b) enforcing the Lenders’ rights in the Collateral
and the Borrower’s obligations under such versions of the Loan Documents and the
Borrower’s obligations thereunder; (c) releasing the Liens against the
Collateral  upon payment in full of the Loan Fee and the other amounts
due under the Loan Documents; and (d) holding all Lenders’ security interests
and Liens in the Collateral granted in the Lenders’ favor under such versions of
the Loan Documents.  Collateral Agent accepts such appointment and
covenants and agrees to perform all covenants and obligations set forth
herein.  Further, Collateral Agent shall have the sole authority to
exercise any and all remedies against Borrower under any and all of the Security
Documents and to act in such capacity in accordance with the terms and
conditions of this Agreement.

       

      4.    
       Decisions/Actions Related to
Remedies under Security Documents.

       

      (a)          The
Collateral Agent may take such actions and pursue such remedies with respect to
the actions and authority set forth in Section 3 hereof as the Collateral Agent
shall, in its discretion, deem appropriate or necessary under the circumstances
hereunder and under any of the Security Documents with respect to the
Collateral.  Further, and in accordance with any Majority Vote, as
defined herein, the Collateral Agent shall: (i) take such actions to enforce,
modify, or amend the Security Agreements on all of the Lenders’ behalf; and (ii)
collect upon, dispose of, or foreclose upon all or any portion of the
Collateral.

       

      (b)    
     The Collateral Agent shall not be obligated or
required to take any action or give any notice that it believes is contrary to
Applicable Law, to the terms of this Agreement, or to the terms of the Credit
Agreement or the other Loan Documents, or that the Collateral Agent believes
will expose any of its owners, officers, or employees to
liability.  Further, the Collateral Agent shall not be required to
take any action hereunder unless and until it has received (for itself, its
owners, officers, employees, and agents) indemnities against any and all losses,
costs, expenses, and liabilities connected thereto.

      


      (c)          The
Collateral Agent shall have no liability whatever in acting in accordance with a
Majority Vote.  Further, no Lender shall have liability to any other
Lender hereunder or otherwise for casting its vote in connection with any
Majority Vote.

      


      (d)          The
Collateral Agent shall provide notice to all of the Lenders of any action taken
in accordance with any Majority Vote and otherwise taken hereunder on behalf of
all Lenders.  However, the Collateral Agent’s failure to provide any
such notice to the other Lenders shall not impair Collateral Agent’s right or
ability to take any action authorized hereunder, nor shall it impair the
validity or enforceability of this Agreement or of any of the Loan Documents,
nor shall it create a cause of action against any party to this Agreement,
including the Collateral Agent.

      


      (e)          Except
for the Lenders’ right to receive its share of the Loan Fee in accordance with
the Credit Agreement, the Lenders only right hereunder and in the Collateral
shall be the right to cast its vote with respect to any Majority Vote in
accordance herewith.  Each of the Lenders hereby agrees that none of
them shall have, and each of them hereby waives, the right to take or threaten
to take any action to enforce any term or provision in any of the Security
Documents or to enforce any rights with respect to any or all of the Collateral,
it being understood that the Collateral Agent alone shall have the right to seek
and enforce any and all rights and remedies in the Collateral and under this
Agreement.


      
        
           


        

        
          2

          
            

          

        

        
           


        

      


      (f)           The
Collateral Agent may, in its discretion, request a Majority Vote with respect to
any action, decision, or course of action Collateral Agent desires or plans to
take hereunder, and the Majority Vote with respect to such action, decision, or
course of action shall be binding on all of the Lenders for all
purposes.

      


      (g)         The
Collateral Agent may release all security interests and Liens of the Lenders
against the Collateral upon payment in full of the amount due under the Note and
the other Loan Documents, including the payment of the Loan Fee.  The
Collateral Agent may also release any or all of such security interests or Liens
against the Collateral upon a Majority Vote of the Lenders.

      


      (h)       
 The Lenders acknowledge and agree that the Borrower has the rights to
dispose of the Collateral, as set forth in the Credit Agreement.

      


      5.           Application of Collateral
Proceeds.  Any amount received by the Collateral Agent from its
enforcement of any of the Security Documents, including, without limitation, the
proceeds from the enforcement, sale, collection, or disposition of any of the
Collateral (collectively, the “Proceeds”), shall be
applied and paid by the Collateral Agent as follows:

       

      (a)          First,
to the costs and expenses of such sale, collection, enforcement, or disposition,
including the fees and costs of such professional advisors as Collateral Agent
deems necessary or appropriate incurred in with exercising any right or remedy
hereunder, including costs related to any indemnification to which Collateral
Agent is entitled hereunder or under any of the Loan Documents; and

      


      (b)         Second,
to the payment of the Obligations for the ratable and proportionate benefit of
the Lenders.

      


      Until the
Collateral Agent so applies and pays any such amount, the Collateral Agent shall
hold such Proceeds in its custody in accordance with the Collateral Agent’s
procedures for holding such funds.

      


      6.           Consent/Approval of
Lenders.  Collateral Agent is hereby authorized as the only
Lender to communicate to and with Borrower with respect to any approval, notice,
and/or consent required or permitted to be given to Borrower or any third party
under the Loan Documents as follows:

       

      (a)         Proportionate
Voting/Majority Vote/Binding and Final.  In each instance of
consent, approval, or notice permitted or required under the Loan Documents,
with respect to each additional action requiring a Majority Vote hereunder, and
with respect to each Majority Vote requested by Collateral Agent hereunder, each
Lender shall have the right to cast a vote.  Each Lender’s vote shall
be weighted, and Collateral Agent and Borrower shall have the right to rely on a
simple majority vote of the Lenders, i.e., a vote of anything amount more than a
50.00% vote, as described herein (each, a “Majority
Vote”).  Each Majority Vote shall be conclusive, final and
binding on Collateral Agent, the other Lenders, and Borrower.


      
        
           


        

        
          3

          
            

          

        

        
           


        

      


      (b)         A
Majority Vote of Lenders shall be calculated by weighting each Lender’s vote and
by aggregating or adding up the weighted votes of all Lenders.  Each
Lender’s vote shall be shall be equal to that portion of the total of all
Lenders’ votes, using the following percentage or formula: the dollar amount of
such Lender’s portion of the aggregate amount of the Loan, divided by the
aggregate amount of the Loan made by or from all of the Lenders (including that
portion of the Loan made from Collateral Agent).  Collateral Agent
shall collect the votes of all Lenders using the foregoing percentage
calculation or formula.  For example, and by not way of limitation, a
Lender who makes a $200,000.00 portion of the Loan in the aggregate amount of
$2,000,000.00 shall cast a vote equal to 10.00% of the total vote cast by all
Lenders.  Similar votes cast by Lenders who made more than 50% of the
aggregate amount of the Loan shall constitute a Majority Vote for purposes of
this Agreement.  Collateral Agent shall communicate the outcome of
each Majority Vote to all Lenders.

      


      (c)      
   If at any time, any Lender fails to cast its vote by the date
identified by Collateral Agent, such failure shall allow Collateral Agent to
cast such Lender’s vote as Collateral Agent, in its sole discretion, deems
appropriate.  Collateral Agent’s decision as to casting such Lender’s
vote shall not expose Collateral Agent to any liability hereunder or otherwise
and shall be conclusive and binding on all Lenders.

      


      (d)       
  Except as expressly set forth in the introductory paragraph to this
Section 6 with respect to any approval, notice, and/or consent required to
Borrower or any third party under the Loan Documents, Collateral Agent shall, in
it sole discretion, have the right and discretion set forth in 4(a) hereof and
otherwise set forth in this Agreement with respect to the Collateral and the
Security Documents.

      


      7.           Compensation.  Borrower
shall be responsible to pay all fees and charges of Collateral Agent
hereunder.

       

      8.           Termination of
Duties.  Collateral Agent’s appointment as collateral agent
shall terminate upon the earlier of:

       

      a.           The
satisfaction in full of all Obligations owing by Borrower under the Credit
Agreement and the Note, including payment of the Loan Fee; or

       

      b.           Thirty
(30) days written notice from Collateral Agent that Collateral Agent desires to
resign as collateral agent.

       

      9.           Successor Collateral
Agent.  Upon the termination of Collateral Agent’s appointment
as collateral agent, Collateral Agent shall immediately assign its rights
hereunder and in the Collateral to the successor collateral agent.

       

      10.         Notices.  All
notices by any party hereto shall be in writing and shall be sent as provided in
the Credit Agreement.

       

      
        
           


        

        
          4

          
            

          

        

        
           


        

      


      11.         Disclaimers.

       

      (a)          By
becoming a party to this Agreement, Collateral Agent shall have no duties,
obligations, or liabilities, except to perform the duties expressly set forth
herein.  The Collateral Agent is and shall not be liable for any
statement, representation, or warranty contained herein or in any of the Loan
Documents or in any other document executed or delivered or existing in
connection therewith or for the validity, enforceability, genuineness,
effectiveness, or sufficiency of any of the such Loan Documents or other
documents or agreements, or for the validity, perfection, priority, or
effectiveness of any security interest or Lien granted to any of the Lenders
under any or all of the Loan Documents or otherwise.  The Collateral
Agent may employ agents and advisors to fulfill any or all of its duties
hereunder and shall not be responsible for the negligence of any such agents or
advisors.  Neither the Collateral Agent, nor its owners, officers,
directors, agents, or advisors shall be liable for any action or omission taken
or omitted to be taken hereunder or in connection herewith, except for actions
that are finally and judicially determined to have resulted from their own gross
negligence or willful misconduct.

       

      (b)  
       The Collateral Agent may request and
rely upon any certification, notice, or other communication believed by it to be
genuine and correct, including the outcome of any Majority Vote.

      


      (c)    
     Each of the Lenders for themselves and their
successors and assigns (each an “Indemnifying
Party”)hereby, jointly and severally, agrees to indemnify, defend, and
hold Collateral Agent (and its owners, officers, agents, and advisors) harmless
from and against all liabilities, losses, obligations, damages, claims, actions,
proceedings, penalties, judgments, costs (including attorney’s fees and costs),
expenses, and/or disbursements of any kind or nature whatever arising, imposed
on, suffered by, asserted against, or connected with Collateral Agent in any way
relating to or arising in connection with this Agreement, the Collateral, the
Loan Documents, or any other documents executed referred to or existing in
connection with any or all of the foregoing documents or with the Transactions;
provided, however, that none of the Indemnifying Parties shall be liable for any
of the foregoing indemnity obligations to extent that they are finally and
judicially determined to have resulted from the gross negligence or the willful
misconduct of Collateral Agent.

      


      (d)          Except
as expressly set forth herein, Collateral Agent shall have no duty to take any
affirmative step or action with respect to collection of any amounts payable or
owed in connection with or related to the Collateral

      


      12.     
    General.

       

      (a)          This
Agreement is made for the sole and exclusive benefit of Borrower and Collateral
Agent and is not intended to benefit any third party.  No such third
party may claim any right or benefit or seek to enforce any term or provision of
this Agreement.

       

      (b)          This
Agreement shall be governed by and construed in accordance with the laws of the
State of Delaware.  In the event of any dispute hereunder, each of the
parties hereto agrees to submit to the venue and jurisdiction of the federal and
state courts of the State of Delaware.

       

      
        
           


        

        
          5

          
            

          

        

        
           


        

      


      (c)      
   Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction only, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

       

      (d)         All
references in this Agreement to the singular shall be deemed to include the
plural if the context so requires and vice versa.  References in the
collective or conjunctive shall also include the disjunctive unless the context
otherwise clearly requires a different interpretation.

       

      (e)        
 This Agreement, together with the Loan Documents, constitute the entire
agreement between the parties hereto as to the subject matter hereof and may not
be altered or amended except by written agreement signed by Administrative
Agent, Borrower, and Collateral Agent.  All other prior and
contemporaneous agreements, arrangements, and understandings between the parties
hereto as to the subject matter hereof are, except as otherwise expressly
provided herein, rescinded.  Facsimile and electronic mail signatures
on this Agreement shall be deemed and shall constitute originals for all
purposes, and this Agreement may be executed in any number of
counterparts.

       

      (f)          Each
of the parties to this Agreement represents and warrants to the other parties
hereto that the execution, delivery, and performance by such party has been duly
authorized by all necessary corporate or other action required for such
authorization and does not violate the provisions of any agreement or other
document to which such party is a party and does not require any governmental or
other approval.

       

      (g)          Each
of the parties hereto agrees to promptly pay Collateral Agent its proportionate
share (calculated in the same manner as a Majority Vote is determined) of all
expenses and costs incurred by Collateral Agent hereunder.

       

      (h)          Collateral
Agent may demand specific performance of this Agreement by every and each party
hereto.  Further, each party hereto waives any defense it may have to
any such claim for specific performance.

       

      IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
Effective Date, as defined in the Credit Agreement.

       

      [SIGNATURES
ON FOLLOWING PAGE]

       

      
        
           


        

        
          6

          
            

          

        

        
           


        

      

       

      
        
          	
                  COLLATERAL
      AGENT:

                	 
      	
                  SEUNG
      NI CAPITAL PARTNERS, L.L.C.

                
	 
      	 
      	 
      	 
      
	 
      	 
      	
                  By:

                	/s/
      Ralph Yarro
	 
      	 
      	
                  Title:

                	Manager
	 
      	 
      	 
      	 
      
	
                  BORROWER:

                	 
      	
                  /s/
      Edward N. Cahn

                
	 
      	 
      	EDWARD
      N. CAHN, Soley in His Capacity as Trustee of the Bankruptcy Estates of The
      SCO Group, Inc. and SCO Operations, Inc., both Delaware
    corporations


        

      

      


      [LENDERS’
SIGNATURES APPEAR ON FOLLOWING SEPARATE COUNTERPART PAGES FOR EACH
LENDER]


      
        
           


        

        
          7

          
            

          

        

        
           


        

      

       

      
        	
                LENDER:

              	 
      
	 
      	 
      	 
      
	 
      	
                By:

              	 
      
	 
      	
                Name: 

              	 
      
	 
      	
                Title:

              	 
      


      

      


      (Each
Lender shall execute and deliver this signature page to Collateral
Agent)


      
        
           


        

        
          8

          
            

          

        

        
           


        

      


      EXHIBIT
“A”

      


      LIST OF
LENDERS

      


      
        
          
            
              	
                      Seung
      Ni Capital, LLC (Ralph Yarro)

                    	 	$	400,000	 
	
                      Jan
      Loeb

                    	 	$	250,000	 
	
                      Leap
      Tide Capital Management, Inc. (Jan Loeb)

                    	 	$	100,000	 
	
                      Steven
      Shin

                    	 	$	50,000	 
	
                      Henry
      Beinstein

                    	 	$	100,000	 
	
                      Stanley
      A. Beinstein

                    	 	$	50,000	 
	
                      Neil
      J. Gagnon

                    	 	$	100,000	 
	
                      Robert
      Dyson

                    	 	$	100,000	 
	
                      WBS
      LLC

                    	 	$	600,000	 
	
                      Ne
      Obliviscaris, Ltd. (Dan Campbell)

                    	 	$	130,000	 
	
                      Darcy
      Mott

                    	 	$	10,000	 
	
                      Clemons
      F. Walker

                    	 	$	100,000	 
	
                      Herbert
      W. Jackson

                    	 	$	10,000	 


            

          

        

      

      


      These
individuals may be a “Lender” either individually or through an entity in which
they own or control an interest.  Additional “Lenders” may be added,
or the foregoing amounts may change.


      
        
           


        

        
          9

          
            

          

        

        
           


        

      

    

     

    EXHIBIT
“B”

    LIST OF
COLLATERAL

    


    1.           Cash,
checking, savings, and other accounts.

    


    2.           Security
deposits paid by the Borrower, as tenant, under various leases.

    


    3.           Ownership
interests in partnerships or joint ventures.

    


    4.           Accounts
receivable.

    


    5.           Inventory.

    


    6.           Equipment,
furnishings, and supplies.

    


    7.           Intellectual
Property, as defined in the attached Credit Agreement.

    


    8.           Contract
and similar rights.

    


    9.           Collateral
expressly listed and identified in each of the Security Documents.

    


    Notwithstanding
the foregoing list, the “Collateral” shall expressly exclude the following: (a)
all “Employee Carve-Out Amounts” referred to in that certain Security and Pledge
Agreement that constitutes one of the Security Documents; (b)
all  causes of action under Chapter 5 of the Bankruptcy Code; and (c)
any voting stock (or other voting equity
interests) in excess of 65% of the outstanding voting stock (or other voting
equity interests) of any foreign Subsidiary.

     

    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    EXHIBIT “C”

    FORM OF
ORDER

    


    
      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

     

    EXHIBIT
“D”

    NOTE

    


    PROMISSORY
NOTE

     

    
      	
              Up
      To $2,000,000.00

            	
              March
      5, 2010

            


    

     

    For value received, the Borrower promises
and agrees to pay to the order of the Lender, in lawful money of the United
States of America, that portion of the principal sum of up to Two Million and
00/100 Dollars ($2,000,000.00) set forth on Exhibit “A” hereto,
or so much thereof as may be outstanding under the Credit Agreement, as defined
herein, together with Basic Interest and other interest on the unpaid
outstanding balance owing thereunder at the rate or rates or in the amounts
computed in accordance with the Credit Agreement, together with all other
amounts due Lender under this Note and under the Credit Agreement, all payable
in the manner and at the time or times provided herein and in the Credit
Agreement.

    


    1.           Definitions.  Except
as otherwise defined herein, each of the capitalized terms appearing in this
Note shall have the meaning ascribed or given to it in that certain Secured
Super-Priority Credit Agreement, of even date herewith, executed by and among
the Borrower and [________________________] (the “Credit
Agreement”).  This provision shall apply to all terms
capitalized terms appearing hereinabove and hereinbelow.

    


    2.           Loan.  The
Lender shall make a portion of the Loan set forth on Exhibit “A”
hereto  in accordance, subject to, and in the manner set forth in
terms and conditions of the Credit Agreement, the aggregate amount of which Loan
shall not exceed Two Million and 00/100 Dollars ($2,000,000.00).

    


    3.           Interest Rate/Maturity
Date.  From the date set forth on the face of this Note above
through the Maturity Date, the outstanding balance of the Loan and of any other
amounts due hereunder (other than the Loan Fee and including any amounts added
to principal under the Loan Documents) shall bear interest at the Basic Rate of
interest per annum.  Any amounts owed hereunder and not repaid on the
Maturity Date shall thereafter bear interest and shall be subject to the late
charges set forth in Section 2.05 of the Credit Agreement.

    


    4.           Payment of Loan
Fee/Loan Fee
Maturity Date.  The Borrower shall pay Lender’s proportionate
share of the Loan Fee to the Lender on the Loan Fee Maturity
Date.  Lender’s proportionate share of the Loan Fee is equal to the
total amount of the Loan Fee owed hereunder and under the Credit Agreement,
multiplied by a fraction, the numerator of which is Lender’s portion of the Loan
disbursed to the Borrower under the Credit Agreement, and the denominator of
which is the total amount of the Loan disbursed to the Borrower under the Loan
Documents and under duplicate originals of the Loan Documents executed by
Lenders other than the Lender and the Borrower in accordance with the Credit
Agreement.  Any portion of the Loan Fee owed but not paid to the
Lender on the Loan Fee Maturity Date shall bear interest at and shall be subject
to the late charges set forth in Section 2.05 of the Credit
Agreement.  No Basic Interest or other interest shall accrue on the
Loan Fee prior to the Loan Fee Maturity Date.


    
      
         


      

      
        1

        
          

        

      

      
         


      

    


    5.           Payments on
Loan.  The Borrower shall also make payments of the amount owed
hereunder from Core Asset Sales, as more fully set forth in the Credit
Agreement.

    


    6.           Maturity Date/Loan Fee
Maturity Date/Payments Made by Wire.  Unless extended in
writing by the Lender, and if not sooner due and payable in accordance with the
Credit Agreement, the Borrower shall pay to the Lender all principal and other
amounts due and unpaid hereunder and under the Credit Agreement on the Maturity
Date and shall pay the Loan Fee on the Loan Fee Maturity Date.  Unless
otherwise specified in writing by the Lender, all payments hereunder shall be
paid to the Lender by wire transfer in immediately available funds to the
following account:

    


    [INSERT
ACCOUNT NUMBER AND ABA ROUTING NUMBER]

    


    7.           Default/Acceleration/Interest
at Default Rate/Remedies.  If any of the following events
occurs:

    


    (a)           the
Borrower fails to make payment of any amount due hereunder within five (5) days
after the same becomes due and payable;

    


    (b)           any
violation or breach of any provision of this Note (other than those listed in
Subsections 6(a) and (b) hereof, each of which has shorter or no time period,
respectively, for curing such defaults or breaches, and which do not require any
written notice thereof to the Borrower) or of any other Loan Document, and if
such Event of Default, breach or default does not involve the payment of a
monetary obligation contained herein or in any of the other Loan Documents;
or

    


    (c)           any
default by the Borrower in the payment or performance of any obligation, or any
Event of Default or any breach of or default under the terms of any contract or
instrument (other than any of the Loan Documents) pursuant to which the Borrower
has incurred any Indebtedness under Section 364 of the Bankruptcy Code,
including the Lender, and that results in the acceleration of the payment of
such Indebtedness or obligation,

    


    then the
default and remedies provisions set forth in the Credit Agreement, including,
without limitation Article VII of the Credit Agreement, shall apply with respect
to the Lender’s rights and remedies, which is not intended to otherwise limit
the Lender’s other rights and remedies under Applicable Law.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


    8.           Limitation of Interest
Rate.  If any interest is contracted for, charged or received
under this Note or the Credit Agreement, or if all of the principal balance
shall be prepaid, so that under any of such circumstances the amount of interest
contracted for, charged or received under this Note or the Credit Agreement on
the principal balance shall exceed the maximum amount of interest permitted by
applicable law, then in such event: (a) the provisions of this paragraph shall
govern and control; (b) neither the Borrower nor any other Person now or
hereafter liable for the payment hereof shall be obligated to pay the amount of
such interest to the extent that it is in excess of the maximum amount of
interest permitted by Applicable Law;  (c) any such excess which may
have been collected shall be either applied as a credit against the then unpaid
principal balance or refunded to the Borrower, at the option of the Lender;
and  (d) the effective rate of interest shall be automatically reduced
to the maximum lawful contract rate allowed under Applicable Law as now or
hereafter construed by the courts having jurisdiction thereof.  It is
further agreed that without limitation of the foregoing, all calculations of the
rate of interest contracted for, charged or received under this Note or any
other Loan Document that are made for the purpose of determining whether such
interest rate exceeds the maximum lawful contract rate, shall be made, to the
extent permitted by Applicable Law, by amortizing, prorating, allocating and
spreading in equal parts during the period of the full stated term of the
Indebtedness evidenced hereby, all interest at any time contracted for, charged
or received from the Borrower or otherwise by the Lender in connection with such
Indebtedness; provided, however, that if any Applicable Law is amended or the
law of the United States of America preempts any Applicable Law, so that it
becomes lawful for the Lender to receive a greater interest per annum rate than
is presently allowed, the Borrower agrees that, on the effective date of such
amendment or preemption, as the case may be, the lawful maximum hereunder shall
be increased to the maximum interest per annum rate allowed by the amended state
law or the law of the United States of America.

    


    9.           Credit
Agreement/Collateral.  This Note evidences all advances made,
interest due and all amounts otherwise owed to Lender under the Credit
Agreement, and all amounts due under the Credit Agreement and the other Loan
Documents are hereby incorporated herein and are due hereunder.  This
Note is executed in conjunction with the Credit Agreement and is secured by the
liens and security interests created under the Loan
Documents.  Reference is made to the Credit Agreement for provisions
relating to repayment of the indebtedness evidenced by this Note, including
mandatory repayment, acceleration following default, late charges, default rate
of interest, limitations on interest, restrictions on prepayment, and
participation interest (if any).  In addition, the Lender and the
other Lenders shall enter into the Collateral Agent Agreement under which the
Lender shall act as Agent in accordance with the terms thereof.

    


    10.         Governing
Law.  This Note has been executed and delivered in and shall be
construed in accordance with and governed by the laws of the State of Delaware
and of the United States of America.

    


    11.         Waiver of Jury
Trial.  THE BORROWER HEREBY UNCONDITIONALLY WAIVES ITS RIGHTS
TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF,
DIRECTLY OR INDIRECTLY, THIS NOTE, ANY OF THE RELATED DOCUMENTS, ANY DEALINGS
BETWEEN BORROWER AND LENDER RELATING TO THE SUBJECT MATTER OF THIS TRANSACTION
OR ANY RELATED TRANSACTIONS, AND/OR THE RELATIONSHIP THAT IS BEING ESTABLISHED
BETWEEN LENDER AND BORROWER.  THE SCOPE OF THIS WAIVER IS INTENDED TO
BE ALL ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT
(INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.)  THIS WAIVER
IS IRREVOCABLE MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO THIS NOTE, ANY RELATED DOCUMENTS, OR TO ANY OTHER DOCUMENTS
OR AGREEMENTS RELATING TO THIS TRANSACTION OR ANY RELATED
TRANSACTION.  IN THE EVENT OF LITIGATION, THIS NOTE MAY BE FILED AS A
WRITTEN CONSENT TO A TRIAL BY THE COURT.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    12.         Entire
Agreement.  This Note and the Credit Agreement and the
other Loan Documents constitute the entire agreement of the Borrower and the
Lender with respect to the subject matter hereof and supersedes all prior
understandings, agreements and representations, express or implied.

    


    13.         No
Waiver.  No delay or failure or forbearance or other act of
commission or omission on the part of the Lender in exercising any rights under
this Note or the other Loan Documents on default by the Borrower including,
without limitation, the Lender’s right to accelerate, nor reinstatement of this
Note by the Lender after such exercise, shall operate as a waiver of the
Lender’s right to exercise such right or of any other right under this Note or
the other Loan Documents, or as a release of the Borrower, for the same default
or any other default, except to the extent such waiver is in writing and signed
by the Lender and then only to the extent specifically set forth in
writing.

    


    14.         Modification.  No
variation or modification of this Note, or any waiver of any of its provisions
or conditions, shall be valid, unless in writing and signed by an authorized
representative of the Borrower and the Lender.  Any such waiver,
consent, modification or change shall be effective only in the specific instance
and for the specific purpose given.

    


    15.         Assignment.  The
Borrower may not delegate or assign its duties or obligations under this Note
without the Lender’s prior written consent, which the Lender may grant or
withhold in its sole discretion; provided, however, that no permitted delegation
or assignment of such duties or obligations shall release the Borrower or any
guarantor, endorser or surety from any duty or obligations under this Note or
the other Loan Documents.  The Lender shall have the right to sell,
assign, encumber, hypothecate, pledge or otherwise transfer or alienate this
Note, either in part or in its entirety, and all or any portion of the
Collateral securing repayment of the amount due hereunder, without the consent
of the Borrower or the consent of any guarantor, endorser or
surety.

    


    16.         Binding
Effect.  Subject to the immediately preceding paragraph, this
Note and all of the covenants, promises and agreements contained in it shall be
binding on and inure to the benefit of the respective legal and personal
representatives, devises, heirs, successors and assigns of the Borrower and the
Lender, provided, however, that the Trustee shall have no personal liability and
is liable only in his capacity as Trustee.

     

    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    17.         Attorney’s
Fees/Costs.  The Borrower agrees to promptly reimburse the
Lender all costs and expenses, including reasonable accountant and attorneys’
fees, paid or incurred by the Lender in connection with the collection or
enforcement of this Note or the other Loan Documents, including defending the
priority of such instrument or as a result of foreclosure against any of the
collateral or obtaining a deed in lieu of foreclosure or conducting a trustee
sale.

    


    18.         Severability.  Any
provision in this Note or the Credit Agreement or the other Loan Documents
that is in conflict with any statute, law or applicable rule shall be deemed
omitted, modified or altered to conform thereto.  Should any provision
of this Note be deemed invalid or unenforceable under applicable law, all of the
remaining provisions shall remain unchanged and in full force and
effect.

    


    19.         Consistency with Credit
Agreement.  In the event of any inconsistency or contradiction
in terms between those contained in this Note and those set forth in the Credit
Agreement, the terms of the Credit Agreement shall control and govern such
inconsistency or contradiction.

    


    Executed as of the date first written
above.

    


    
      
        
          	
                  BORROWER:

                
	 
      
	

                  /s/
      Edward N. Cahn

                
	
                  EDWARD
      N. CAHN, Solely in His Capacity as Trustee of the Bankruptcy Estates of
      The SCO Group, Inc. and SCO Operations, Inc., both Delaware
      corporations

                


        

      

    


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    EXHIBIT
“E”

    LIST AND
FORM OF SECURITY DOCUMENTS

     

    
      SECURITY AND PLEDGE
AGREEMENT

      


      THIS
SECURITY AND PLEDGE AGREEMENT (this “Security
Agreement”)  is made and entered into as of this 5th day of March, 2010, by
and among the Bankruptcy Estates of The SCO Group, Inc., a Delaware corporation
(“SCO Group”),
and SCO Operations, Inc., a Delaware corporation (“SCO Operations”) (SCO
Group and SCO Operations are sometimes collectively referred to herein as “SCO”),  by
and through Edward N. Cahn, solely in his capacity as Chapter 11 trustee for the
Bankruptcy Estates of SCO (collectively, “Debtor”), and
______________________ (“Secured
Party”).

       

      RECITALS:

       

      A.          Secured
Party, and Debtor have entered into that certain Secured Super-Priority Credit
Agreement, of even date herewith (the
“Credit
Agreement”), in connection with Secured Party’s making of a portion of a
loan in the amount of up to $2,000,000.00 to Debtor (the “Loan”).

       

      B.           The
provisions of the Credit Agreement require that Debtor execute certain
documents, including this Security Agreement, which provides for a lien and
security interest in favor of the Secured Party in certain of the assets and properties of the
Debtor, whether now owned or hereafter acquired, as security for the
Loan.

       

      NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, Debtor and Secured Party agree as
follows:

       

      1.

       

      DEFINITIONS

       

      Definitions.  Except
as otherwise defined herein, each of the capitalized terms appearing in this
Agreement shall have the meaning ascribed
or given to it in that certain Secured Super-Priority Credit Agreement, of even
date herewith, executed by and among the Borrower and Secured Party, as one of
the Lenders (the “Credit
Agreement”).  This provision shall apply to all capitalized
terms appearing hereinabove and hereinbelow.  In addition, unless
otherwise defined herein or in the Credit Agreement, each term used herein and
defined in the Uniform Commercial Code as enacted in the State of Delaware (“UCC”) shall have the
meaning given to such term in the UCC.  Each of the Lenders has
entered into a duplicate original of the Credit Agreement with
Borrower.

       

      
        
           


        

        
          1

          
            

          

        

        
           


        

      

       

      2.

       

      GRANT OF SECURITY
INTEREST

       

      a.           Debtor,
for consideration and to secure the Secured Obligations (as defined herein),
hereby grants to Secured Party a first lien and a continuing security interest
(subject only to Permitted Encumbrances, as defined herein) in all of Debtor’s
right, title and interest in all of the following
assets and properties of Debtor, tangible and intangible, whether now
owned or hereafter acquired, together with all additions, substitutions, and
proceeds therefrom or arising out of the rights reflected therein, and all
renewals, amendments, substitutions, and replacements of all or any part thereof
collectively, (“Collateral”):

       

      i.           Inventory.  All
inventory in all of its forms, wherever located, including but not limited to:
(i) all raw materials and work in process therefor, finished goods thereof, and
materials used or consumed in the manufacture or production thereof; (ii) goods
which are returned to or repossessed by Debtor; (iii) all supplies and personal
property now owned or hereafter acquired and held for sale or lease or furnished
or to be furnished under contracts of service or used or consumed in Debtor’s
business (including without limitation, packaging and/or shipping materials);
and (iv) all additions and accessions thereto, and substitutions therefor and
products thereof and documents therefor, and all documents of title issued in
respect of any of the foregoing, whether negotiable or non-negotiable, and
including, without limitation, all warehouse receipts, and all other goods which
constitute “inventory” (as defined in the UCC) (collectively, the “Inventory”).

       

      ii.          Accounts and
Rights.  All accounts, notes, drafts, acceptances, letters of
credit, chattel paper, instruments, documents, and other obligations of any
kind, now or hereafter existing, arising in connection with the sale or lease of
goods, including without limitation the Inventory, or the rendering of services,
and all rights now or hereafter existing in and to all security agreements,
mortgages, deeds of trust, collateral assignments, leases, and other contracts
securing or otherwise relating to any such accounts, notes, drafts, acceptances,
chattel paper, instruments, documents, and all other items which constitute
“accounts” (as defined in the UCC) (collectively, the “Accounts”).

       

      iii.         Equipment and
Fixtures.  All equipment and fixtures, in all forms, wherever
located, and all machinery, furnishings, appliances, leasehold improvements,
vehicles, aircraft, trade fixtures, chattels and motor vehicles, including
without limitation equipment processing, fabricating, production and other
equipment, together with all increases, parts, fittings, accessories, special
tools and accessions now or hereafter attached thereto or used in connection
with, and any and all replacements of or substitutions for all or any part of
the foregoing.

       

      iv.         General
Intangibles.  All general intangibles, including, but not
limited to, all bank deposit accounts, customer deposit accounts, deposits,
rights related to prepaid expenses, negotiable or non-negotiable instruments,
chattel paper, Securities Collateral not constituting Investment Property (as
defined below), payment intangibles, choses in action, causes of action, equity
and patronage rights in cooperatives, and all other intangible personal property
of every kind and nature (other than Accounts), including without limitation,
corporate or other business records, intellectual property, inventions, designs,
patents, patent applications, copyrights, trademarks, trade names, trade
secrets, goodwill, registrations, licenses, permits, and all franchises,
customer lists, tax refunds, tax refund claims, miscellaneous rights to payment,
rights and claims against carriers and shippers, leases, rights to
indemnification, government subsidies, set asides, diversions, deficiencies or
disaster payments or payments in kind, government benefits, or any such payments
received from the government or from any other source for participation in any
government program, manure spreading licenses, easements and agreements,
environmental permits, waster disposal permits, brands and brand registrations,
water rights (including without limitation, water stock, ditch rights, well
permits, water permits, applications and the like), storage agreements or
contracts, leasehold interests in real and personal property and any security
interests or other security held by or granted to Debtor to secure payment by
any account debtor of any of the Accounts, and any other “general intangibles”
(as defined in the UCC), and all other intangible personal property of every
kind and nature.

       

      
        
           


        

        
          2

          
            

          

        

        
           


        

      

       

      v.          Investment
Property.  All investment property, as defined in Article 9 of
the UCC (“Investment
Property”), including, without limitation, all securities accounts and
all certificated and uncertificated securities (“Securities”) and all
options, warrants or other rights to purchase the Securities, and any and all
substitutions to or for the Securities from time to time, including any new,
substituted or additional shares or other securities, issued by reason of any
share dividend, reclassification, readjustment, split-off, split-up, or other
change declared or made in the capital structure of the issuer of the Securities
and all now existing and hereafter arising general intangibles of Debtor with
respect to the Securities, including without limitation, all voting rights and
rights to and interest in all cash and noncash dividends and all other property
now or hereafter distributable on account of or receivable with respect to any
of the foregoing, and the proceeds, products, and accessions of and to any of
the foregoing.

       

      vi.         Bank
Accounts.  All bank accounts and investment accounts of
Debtor.

       

      vii.        Insurance.  All
right, title and interest of Debtor under any policies of
insurance.

       

      viii.       Books and
Records.  All books, records, customer lists, supplier lists,
ledgers, evidences of shipping, invoices, purchase orders, sales orders, and
other evidences of Debtor’s business records, including all cabinets, drawers,
and other containers that may hold the same, and computer records, lists, and
software programs, wherever located.

       

      ix.         Commercial Tort
Claims.  (i) The SCO Group, Inc., by and through Edward N.
Cahn, Chapter 11 Trustee, v. Novell, Inc., Case No. 2:04cv00139, pending in the
United States District Court for the District of Utah; and (ii) the SCO Group,
Inc. v. International Business Machines Corporation, Case No. 2:03cv00294,
pending in the United States District Court for the District of Utah (the
foregoing cases are collectively defined herein as the “Litigation.”

       

      x.          Litigation
Proceeds.  All of the Litigation Proceeds.

       

      xi.         Payment
Intangibles.  All right, title and interest of Debtor (in each
case, whether now or hereafter existing, owned, arising, or acquired) in and to
a payment intangible (as defined in the UCC), and (whether or not included in
such definition) a General Intangible under which the account debtor’s principal
obligation is a monetary obligation, including without limitation any judgments,
settlements, or other rights to payment or any proceeds therefrom.

       

      
        
           


        

        
          3

          
            

          

        

        
           


        

      

       

      xii.           Products
and Proceeds.  All products and proceeds of any and all of the
foregoing, including, but not limited to, proceeds which constitute property of
the types described in the foregoing paragraphs of this Section 2 and, to the
extent not otherwise included, all payments under insurance (whether or not
Secured Party is the loss payee thereof), or any indemnity, warranty or
guaranty, payable by reason of loss or damage to or otherwise with respect to
any of the foregoing; provided, however,
notwithstanding anything to the contrary contained in this Agreement or the
other Loan Documents, no lien or security interest is hereby granted on or
created in any Excluded Property (as defined below) and the Collateral shall not
include any Excluded Property.  “Excluded Property” means,
collectively, (1) any voting stock (or other voting equity interests) in excess
of 65% of the outstanding voting stock (or other voting equity interests) of any
foreign Subsidiary, (2) any claims or causes of action of the Estates under
Chapter 5 of the Bankruptcy Code and the proceeds thereof, (3) any property that
is, as of the date of this Agreement, the subject of a pending sale motion by
Debtor before the Bankruptcy Court, and (4) Non-Core Assets.

       

      3.

       

      SECURED
OBLIGATIONS

       

      This
Security Agreement shall secure the payment and performance of all obligations
of Debtor to Secured Party arising under the Note and the Loan Documents
pursuant to which Debtor has agreed to: (i) the due and punctual payment, in
lawful money of the United States, of all amounts owing under the Credit
Agreement, the Notes, and any other Loan Documents, including principal,
interest, fees, costs, reimbursements, and all other obligations under any of
the Loan Documents, as and when any of the foregoing shall become due and
payable in accordance with the terms thereof at stated maturity, by
acceleration, or otherwise; and (ii) the full and timely performance of any and
all other obligations of every kind which is now, or may hereafter become due,
whether now existing or hereafter contracted or incurred, arising under the
Credit Agreement, the Note or any other Loan Document(s) (collectively, the
obligations described in clauses (i) and (ii) above, the “Secured
Obligations”), and extends to any renewal, refinancing, refunding,
extension or modification of any Secured Obligations on one or more occasions,
and to any interest that accrues on any Secured Obligations before or after the
bankruptcy of Debtor.

       

      4.

       

      REPRESENTATIONS AND
WARRANTIES

       

      a.           Debtor
represents and warrants to Secured Party as follows:

       

      i.           Title to Collateral.
Section 3.12 of the Credit Agreement is hereby incorporated herein.

       

      
        
           


        

        
          4

          
            

          

        

        
           


        

      

       

      5.

       

      COVENANTS OF
DEBTOR

       

      a.           Debtor
covenants to Secured Party that:

       

      i.           Title to
Collateral.  Except for Liens permitted under the Credit
Agreement (collectively, Permitted
Encumbrances”), Debtor shall not create or permit the existence of any
Liens against any of the Collateral.  Except with respect to Permitted
Encumbrances, Debtor shall: (a) provide prompt written notice to Secured Party
of any future Liens against any Collateral; (b) promptly obtain a release or
discharge of any Liens; and (c) diligently defend Debtor’s and Secured Party’s
interests in the Collateral.

       

      ii.          Location of Debtor and
Collateral.  Debtor will not change its chief executive office,
the location of any material Collateral, or the location of its material books
and records without giving at least thirty (30) days’ prior written notice to
Secured Party and furnishing Secured Party with such documents as Secured Party
may request pursuant to Section 5.12 hereof prior to taking any such
action.

       

      iii.         Inspection of
Collateral.  Upon Secured Party’s request and, absent the
existence of an Event of Default, at Secured Party’s cost and expense, Debtor
shall at all reasonable times and upon reasonable advance written notice allow
Secured Party or persons designated by Secured Party to:  (a) examine
the Collateral, wherever located, (b) examine and make extracts or copies from
Debtor’s books and records; and (c) discuss Debtor’s affairs, finances,
operations, and accounts with its respective officers, directors, employees, and
independent certified public accountants.

       

      iv.         Transfers, Dispositions and
Encumbrances.  Debtor will not sell, assign or transfer or
otherwise dispose of any of the Collateral, except as expressly permitted by the
Credit Agreement.

       

      v.          Compliance with
Laws.  Debtor shall not use the Collateral in violation of any
applicable statutes, regulations or ordinances, except for violations which
would not have a Material Adverse Effect.

       

      vi.         Further
Assurances.  Section 5.07 of the Credit Agreement is hereby
incorporated herein.  Notwithstanding anything to the contrary
contained in Section 5.07 of the Credit Agreement or elsewhere in the Loan
Documents, Debtor shall not be required to enter into any control or similar
agreements with respect to any deposit or other accounts.

       

      6.

       

      EVENTS OF
DEFAULT

       

      Each of
the Events of Default listed in the Credit Agreement shall constitute an Event
of Default hereunder.

       

      
        
           


        

        
          5

          
            

          

        

        
           


        

      

       

      7.

       

      RIGHTS AND REMEDIES OF
SECURED PARTY

       

      In
addition to the remedies outlined and provided for in the Credit Agreement,
Secured Party shall have the following remedies upon the occurrence and during
the continuance of any Event of Default:

       

      a.           Insurance.  If
any loss, damage or injury occurs to any insured Collateral, Secured Party may,
at its option, apply the proceeds of any policy of insurance insuring such
Collateral to the payment of any of the Secured Obligations, or may apply such
proceeds to the repair or replacement of such Collateral pursuant to such
disbursement procedures and conditions as Secured Party may reasonably
require.  Notwithstanding the foregoing, so long as no Event of
Default has occurred and is continuing, in the event of loss, damage or injury
to any insured Collateral, Secured Party shall make the proceeds of any policy
of insurance insuring such Collateral available to Debtor for the purpose of
repairing or replacing such Collateral; provided, that the disbursement of such
proceeds to Debtor shall be subject to such disbursement procedures and
conditions as Secured Party may reasonably require.

       

      b.           General.  Upon
the occurrence and during the continuance of an Event of Default and at any time
thereafter, Secured Party may declare the Secured Obligations immediately due
and payable, and Secured Party shall have all the rights and remedies of a
secured party under Article 9 of the UCC or other Applicable Law and all the
rights provided herein, in the Credit Agreement, or in any other Loan Document,
all of which rights and remedies shall, to the full extent permitted by law, be
cumulative.

       

      c.           Right of Secured Party to
Take Possession and Dispose of Collateral.  Upon the occurrence
of an Event of Default that is continuing, Secured Party shall also have the
right to:

       

      i.           take
possession of the Collateral and enter upon the premises on which the Collateral
or any part thereof may be situated and remove the Collateral from those
premises without notice to Debtor, and thereafter to hold, store, and/or use,
operate, manage, and control the Collateral and do all things Secured Party
shall deem necessary or appropriate in the preparation, marketing and
disposition thereof, including, but not limited to, caring for, protecting,
storing, transporting and otherwise placing in marketable condition any of the
Collateral;

       

      ii.          without
charge, use or occupy the premises of Debtor or premises under Debtor’s control
and exercise all rights of Debtor under any leases or subleases covering such
premises;

       

      iii.         require
Debtor to deliver the Collateral to Secured Party at a place to be designated by
Secured Party which is reasonably convenient to both parties;

       

      iv.         without
charge, use any patent, trademark, trade name, or other intellectual property or
technical process owned (or, to the extent permitted under the applicable
license, licensed) by Debtor in connection with any of the Collateral;
and

       

      
        
           


        

        
          6

          
            

          

        

        
           


        

      

       

      v.          sell,
lease or otherwise dispose of any or all of the Collateral in its then present
condition or following any commercially reasonable preparation or processing
thereof, whether by public or private sale, for cash, on credit or otherwise,
with or without representations or warranties, and upon such commercially
reasonable terms as may be acceptable to Secured Party, and Secured Party may
purchase the Collateral at any public sale or at any private sale where the
Collateral being sold is of a type customarily sold on a recognized market or of
a type which is the subject of widely distributed standard price
quotations

       

      Debtor
authorizes Secured Party to enter upon its premises for all of these purposes
and hereby waives any claim of trespass and any right to payment as a result of
such entry upon or such use of the premises.

       

      d.           Notice of Disposition of
Collateral.  Upon the occurrence of an Event of Default that is
continuing, unless the Collateral is perishable or threatens to decline speedily
in value, Secured Party will give notice to Debtor of any public sale or of the
time after which any private sale or other intended disposition is to be made by
Secured Party with respect to any Collateral which is subject to Article 9 of
the UCC at the address for Debtor specified above, or such other address as may
from time to time be shown on Secured Party’s records, at least ten (10) days
prior to such action.  Any such notice shall be deemed to meet any
requirement hereunder or under any applicable law (including, without
limitation, the UCC) that reasonable notification be given of the time and place
of such sale or other disposition or the time after which such sale or other
disposition may occur.  Debtor consents and agrees that, in addition
to the other rights and remedies provided to Secured Party in this Article 7,
Secured Party may, in lieu of, or prior to, selling the Collateral at public or
private sale, retain any payments received on account of any of the Collateral
and apply the same to amounts owing under the Secured Obligations until such
time as the Secured Obligations have been paid in full.

       

      e.           Right of Secured Party to
Use and Operate Collateral.  Upon the occurrence of an Event of
Default that is continuing:

       

      i.           Upon
exercise of Secured Party’s right to take possession of the Collateral, Secured
Party may, from time to time, make all repairs, replacements, alterations,
additions, and improvements to any of the Collateral that Secured Party deems
proper.  Debtor shall reimburse Secured Party on demand for any
reasonable expenses incurred by Secured Party pursuant to the foregoing
authorization and any such unreimbursed expenses shall constitute amounts owing
under the Secured Obligations for all purposes under this Security
Agreement.

       

      ii.          Secured
Party shall have the right to operate, manage and control the Collateral and to
carry on Debtor’s business and to exercise all rights and powers of Debtor in
respect of the Collateral as Secured Party sees fit, including the right to
enter into agreements with respect to the Collateral or any part thereof; and
Secured Party shall be entitled to collect and receive all rents, issues,
profits, fees, revenues, and other income of the Collateral and every part
thereof.  Such rents, issues, profits, fees, revenues, and other
income shall be applied to pay the expenses of holding and operating the
Collateral and of conducting the business thereof and of all maintenance,
repairs, replacements, processing, alterations, additions, and improvements, and
to make all payments which Secured Party may be required or may reasonably elect
to make, if any, for taxes, assessments, insurance, and other charges upon the
Collateral or any part thereof, and all other payments which Secured Party may
be required or authorized to make under any provision of this Security Agreement
(including reasonable attorneys’ fees and expenses). The remainder of such
rents, issues, profits, fees, revenues, and other income shall be applied to the
payment of the Secured Obligations as provided by law.

       

      
        
           


        

        
          7

          
            

          

        

        
           


        

      

       

      f.           Collection of
Accounts.  Upon the occurrence of any Event of Default that is
continuing:

       

      i.           Debtor
shall provide promptly to Secured Party such reports, certificates, lists of
account debtors (showing names, addresses and amounts owing), invoices
applicable to each account, and other data concerning Debtor’s accounts,
contracts, collections and other matters as Secured Party may from time to time
request.

       

      ii.          Secured
Party shall have the right at any time and from time to time, without notice,
to: (i) notify account debtors that their accounts, chattel paper or the general
intangible on which they are obligated have been assigned to Secured Party; (ii)
advise account debtors of Secured Party’s security interest and/or instruct
account debtors to make payments directly to Secured Party; (iii) charge to any
investment or other account (excluding escrow accounts) of Debtor with or
controlled by Secured Party any item of payment received by Secured Party which
is dishonored by the drawee or maker thereof; (iv) endorse all items of payment
made payable to Debtor which may come into the possession of Secured Party; (v)
collect all accounts in the name of Secured Party or in Debtor’s name, and take
control of any cash or non-cash proceeds of accounts and of any returned or
repossessed goods; (vi) compromise, extend or renew the amount owing on any
account or deal with any account as Secured Party may deem advisable; and (vii)
make exchanges, substitutions or surrenders of collateral for any
account.

       

      iii.         Once
any or all account debtors have been notified, whether by Debtor or Secured
Party, to make payment directly to Secured Party, all amounts and proceeds
received by Debtor in respect of such accounts shall be received in trust for
the benefit of Secured Party, shall be segregated from other funds of Debtor,
and shall be immediately paid over to Secured Party in the same form as so
received.  Such actions and the application of any such amounts to the
Secured Obligations shall not be deemed to constitute retention in satisfaction
of the Secured Obligations under the UCC and any comparable provision of the UCC
as enacted in any other state where the Collateral is located.

       

      g.           Rights of Secured Party With
Respect to the Securities Collateral.  Upon the occurrence of
any Event of Default that is continuing:

       

      
        
           


        

        
          8

          
            

          

        

        
           


        

      


      i.           Secured
Party, in its discretion, and without notice to Debtor, may take any one or more
of the following actions without liability except to account for property
actually received by it: (i) transfer to or register in its name or the name of
its nominee any stock certificates or any other evidence of the Securities
Collateral, with or without indication of the security interest herein created,
and whether or not so transferred or registered, receive the income, dividends
and other distributions thereon and apply them to the Secured Obligations in any
order of priority; (ii) exercise or cause to be exercised all voting and
corporate powers with respect to any of the Securities Collateral so registered
or transferred, including: (A) all rights to call or require
shareholders/partners/members meetings and to remove or elect directors/managing
partners/managers, as applicable; and (B) all rights of proxy appointments,
conversion, exchange, subscription or any other rights, privileges or options
pertaining to such Securities Collateral, as if the absolute owner thereof;
(iii) exchange any of the Securities Collateral for other property upon a
reorganization, recapitalization, reclassification or other readjustment and, in
connection therewith, deposit any of the Securities Collateral with any
depository upon such terms as Secured Party may determine; and (iv) in its name
or in the name of Debtor, demand, sue for, collect or receive any money or
property at any time payable or receivable on account of or in exchange for any
of the Securities Collateral, and Secured Party further shall have the right at
any time to sign and endorse the name of Debtor upon any stock certificate,
stock power, check, draft, money order, or any other documents of title or
evidences of payment with respect to the Securities Collateral, in the name of
Debtor, it being the intention of Debtor to grant to Secured Party the right to
sell any portion or all of the Securities Collateral and the proceeds therefrom,
upon the occurrence and during the continuance of an Event of Default
hereunder.

       

      ii.           If
Secured Party in good faith believes that the Securities Act of 1933 (“Act”) or any other
state or federal law prohibits or restricts the manner of sale or distribution
of any of the Securities Collateral, Secured Party may sell such Securities
Collateral privately or in any other manner deemed advisable by Secured Party at
such price or prices as Secured Party determines in its reasonable
discretion.  Debtor recognizes that such prohibition or restriction
may cause the Securities Collateral to have less value than it otherwise would
have and that, consequently, such sale or disposition by Secured Party may
result in a lower sales price than if the sale were otherwise held. Secured
Party may sell the Securities Collateral in one or more sales or parcels, for
cash, credit or future delivery, and with or without the use of a broker, as
Secured Party may deem advisable.  Secured Party may be the purchaser
of any or all of the Securities Collateral to the extent permitted by
law.  In no event shall Debtor be required to register the Securities
Collateral.

       

      8.

       

      GENERAL
PROVISIONS

       

      a.           Amendment, Modification, and
Waiver.  Section 8.07 of the Credit Agreement is hereby
incorporated herein.

       

      b.           Consistency with Credit
Agreement and
Order.  In the event of any conflict between the terms and
conditions of this Agreement and the terms and conditions of the Credit
Agreement or the Order, the terms and conditions of the Credit Agreement or the
Order, as applicable, shall supersede and control in all respects; provided,
however, that as among this Agreement, the Credit Agreement, the other Loan
Documents and the Order, the Order shall govern in all respects.

       

      
        
           


        

        
          9

          
            

          

        

        
           


        

      

       

      c.           Costs and Attorneys’
Fees.  Debtor will, upon demand, pay to Secured Party the
amount of any and all reasonable out of pocket expenses, including the
reasonable attorneys’ fees and expenses of counsel for Secured Party, and of any
experts and agents which Secured Party may incur in connection with: (a) the
administration of this Security Agreement upon the occurrence and during the
continuance of an Event of Default; (b) the collection, retaking, storage,
custody, preservation, use or operation of, preparing for sale, selling or other
disposition and delivery, collection from, or other realization upon, any of the
Collateral upon the occurrence and during the continuance of an Event of
Default; (c) the exercise or enforcement of any of the rights of Secured Party
hereunder; or (d) the failure by Debtor to perform or observe any of the
provisions hereof.

       

      d.           Revival of
Obligations.  To the extent Debtor or any third party makes a
payment or payments to Secured Party, and to the extent that the Secured Party
enforces its security interest or exercises any right of setoff, and such
payment or payments or the proceeds thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, and/or required to be
repaid to a trustee, receiver, or any other party under any bankruptcy,
insolvency or other law or in equity, then, to the extent of such recovery, the
Secured Obligations or any part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment or
payments had not been made, or such enforcement or setoff had not
occurred.

       

      e.           Performance by Secured
Party.  If Debtor shall at any time fail to pay or perform
punctually any of its duties hereunder, Secured Party may, at its option and
upon reasonable notice to Debtor, without obligation and without waiving or
diminishing any of its other rights or remedies hereunder, fully perform or
discharge any of such duties.  All reasonable out of pocket costs and
expenses incurred by Secured Party in connection therewith, together with
interest thereon at the Default Interest Rate set forth in the Credit Agreement
shall become part of the Secured Obligations and be paid by Debtor upon
demand.

       

      f.           
Power of
Attorney.  Secured Party is hereby appointed Debtor’s
attorney-in-fact, with full power of substitution, at Secured Party’s option and
Debtor’s expense, to do all acts and things which Secured Party may reasonably
deem necessary to protect or enforce and collect on the Collateral upon the
occurrence of an Event of Default hereunder that is continuing, including,
without limitation:

       

      i.           obtaining
and adjusting the insurance required to be maintained under the Credit Agreement
and adjusting or settling any and all such insurance and, upon any disposition
of the Collateral pursuant to Section 7 of this Security Agreement, canceling
any and all insurance covering such Collateral, endorsing the name of Debtor on
any and all checks or drafts drawn by any insurer, whether representing payment
for a loss or a return of unearned premium, and executing any and all proofs of
claim and other documents or instruments of every kind required by any insurer
in connection with any payment by such insurer;

       

      
        
           


        

        
          10

          
            

          

        

        
           


        

      

       

      ii.          upon
the occurrence of an Event of Default that is continuing, asking, demanding,
collecting, suing for, recovering, compromising, receiving and giving receipts
for moneys due and to become due under or in respect of any of the
Collateral;

       

      iii.         upon
the occurrence of an Event of Default that is continuing, collecting and
endorsing the name of Debtor in favor of Secured Party on any and all checks,
drafts, money orders, notes, acceptances or other instruments of the same or a
different nature, constituting, evidencing or relating to the
Collateral;

       

      iv.         upon
the occurrence of an Event of Default that is continuing, receiving and opening
all mail addressed to Debtor and removing therefrom any cash or non-cash items
of payment constituting proceeds of the Collateral; and

       

      v.          upon
the occurrence of an Event of Default that is continuing, filing any claims or
taking any action or instituting any proceedings which Secured Party may deem
necessary or desirable for the collection of any of the Collateral or otherwise
to enforce the rights of Secured Party with respect to any of the
Collateral.

       

      The power
vested in Secured Party as Debtor’s attorney-in-fact is, and shall be deemed to
be, coupled with an interest and cannot be revoked.

       

      g.           Protection of
Collateral.  Secured Party shall not be required to take any
steps necessary to preserve any rights in the Collateral.  Secured
Party shall further be under no duty to exercise or to withhold the exercise of
any of the rights, powers, privileges and options expressly or implicitly
granted to Secured Party in this Security Agreement, and Secured Party shall not
be responsible for any failure to exercise such rights, nor for its delay in so
doing.  Secured Party shall be deemed to have exercised reasonable
care as custodian of the Collateral if it takes such action to protect and
preserve the Collateral as Debtor shall request, but failure to honor any such
request shall not be deemed to be a failure by Secured Party to exercise
reasonable care. The care which Secured Party gives to the safekeeping of
property of like kind shall constitute reasonable care of the Collateral when in
Secured Party’s possession.

       

      h.           Additional Rights of Secured
Party.  Secured Party, in its discretion, and without notice to
Debtor, may take any one or more of the following actions without liability
except to account for property actually received by it: (a) after the occurrence
of an Event of Default, renew, extend, or otherwise change the terms and
conditions of any of the Collateral; (b) take or release any other collateral as
security for any of the Collateral or the Secured Obligations; and (c) add or
release any guarantor, endorser, surety or other party to any of the Collateral
or Secured Obligations.

       

      i.           Binding
Effect/Successors.  Sections 8.03 and 8.04 of the Credit
Agreement is hereby incorporated herein.

       

      j.           Advances.  Nothing
herein contained shall be construed to obligate Secured Party to make any loans
or advances to Debtor, and the sole purpose of this Security Agreement is to
provide collateral security for the Secured Obligations.

       

      
        
           


        

        
          11

          
            

          

        

        
           


        

      

       

      k.           Severability/Entire
Agreement.  Section 8.09 of the Credit Agreement is hereby
incorporated herein.

       

      l.           Governing
Law.  This Security Agreement shall be governed by and
interpreted in accordance with the laws of the State of Delaware, except to the
extent that perfection (and the effect of perfection and non-perfection) and
certain remedies may be governed by the laws of any jurisdiction other than the
State of Delaware.

       

      m.           Notices.  Section
8.01 of the Credit Agreement is hereby incorporated into this Security
Agreement.

       

      n.           Consent to Jurisdiction and
Service of Process.  Section 8.14 of the Credit Agreement is
hereby incorporated herein.

       

      o.           Jury
Waiver.  Section 8.10 of the Credit Agreement is hereby
incorporated herein.

       

      p.           Financing
Statements.  A copy, including a photocopy, of this Security
Agreement may be filed as a financing statement. Debtor authorizes Secured Party
to file without the signature of Debtor (where permitted by law) one or more
financing or continuation statements, and amendments thereto relative to all or
any part of the Collateral, as Secured Party may deem appropriate in order to
perfect or continue the perfection and priority of Secured Party’s security
interest in the Collateral.

       

      q.           Counterparts/Facsimiles.  Section
8.12 of the Credit Agreement is hereby incorporated herein.

       

      r.           Collateral Agent
Agreement.  Debtor acknowledges and agrees that Secured Party,
as Agent and alone, shall have the right to enforce all Lenders’ rights relating
to the Collateral under the Loan Documents and under duplicate originals of all
of the Loan Documents executed by the Lenders (other than the Lender) and
Debtor.

       

      s.           Employee Carve-Out
Amounts.  (a) Upon the occurrence and during the continuance of
an Event of Default, payments of any amounts on account of the Secured Liens and
the Superpriority Claims (in each case, as defined in the Order) shall be
subject and subordinate only to payment of all accrued and unpaid wages,
salaries, benefits and severance and all taxes associated therewith for
employees of Debtor and the foreign Subsidiaries of Debtor (collectively, the
"Employee Carve-Out
Amounts"); and (b) in the event that Lenders (as defined in the Order)
exercise any rights or remedies under the Loan Documents, Lenders shall deposit
all collections and proceeds of Collateral into a segregated account until all
Employee Carve-Out Amounts are paid in full; and (c) upon the occurrence of an
Event of Default, and after notice from Agent to Debtor, Debtor shall promptly
remit all amounts in excess of the Employee Carve-Out Amounts to Security
Party.

       

      t.           No Personal Liability for
Trustee.  Section 8.17(a) of the Credit Agreement is
incorporated herein.

       

      u.           Releases.

       

      
        
           


        

        
          12

          
            

          

        

        
           


        

      

       

      i.           At
such time as the Secured Obligations (other than contingent indemnification
obligations and obligations with respect to the Loan Fee) have been paid in
full, the Collateral (other than the Litigation Proceeds) shall be released from
the Liens created hereby, and all obligations of Debtor hereunder with respect
to the Collateral (other than the Litigation Proceeds) shall terminate, all
without delivery of any instrument or performance of any act by any party, and
all rights to the Collateral (other than the Litigation Proceeds) shall revert
to Debtor.  At the request of Debtor following any such release,
Secured Party shall deliver to the Debtor any Collateral (other than the
Litigation Proceeds) held by Secured Party hereunder, and execute and deliver to
Debtor such documents as Debtor shall reasonably request to further evidence
such release.

       

      ii.          At
such time as the Loan Fee has been paid in full with respect to any Litigation,
the Litigation Proceeds with respect to such Litigation shall be released from
the Liens created hereby, and all obligations of Debtor hereunder with respect
to such Litigation Proceeds shall terminate, all without delivery of any
instrument or performance of any act by any party, and all rights to such
Litigation Proceeds shall revert to Debtor.  At the request of Debtor
following any such release, Secured Party shall execute and deliver to Debtor
such documents as Debtor shall reasonably request to further evidence such
release.

       

      iii.         If
any of the Collateral shall be sold, transferred or otherwise disposed of by
Debtor in a transaction permitted by the Credit Agreement, such Collateral shall
be released from the Liens created hereby, and all obligations of Debtor
hereunder with respect to such Collateral shall terminate, all without delivery
of any instrument or performance of any act by any party, and all rights to such
Collateral shall revert to Debtor.  At the request of Debtor following
any such release, Secured Party shall deliver to the Debtor any such Collateral
held by Secured Party hereunder, and execute and deliver to Debtor such
documents as Debtor shall reasonably request to further evidence such
release.

       

      IN
WITNESS WHEREOF, the parties to this Security Agreement have executed it as of
the Effective Date.

       

      
        
          
            	
                    BORROWER:

                  	
                        

                  
	 
      	
                    Edward
      N. Cahn, in His Sole Capacity as Trustee of the Bankruptcy Estates of The
      SCO Group, Inc., a Delaware corporation and SCO Operations, Inc., a
      Delaware corporation

                  


          

        

        


        
          
            	
                    SECURED
      PARTY:

                  	
                         

                  	 
      
	 
      	
                        

                  	 
      


          

        

        


        
          
            	 
      	
                    By:

                  	
                      

                  
	 
      	
                    Name:

                  	
                      

                  
	 
      	
                    Title:

                  	
                       

                  


          

        

      

      

        
          
             


          

          
            13

            
              

            

          

          
             


          

        

      

       

      STOCK PLEDGE
AGREEMENT

      


      THIS STOCK PLEDGE AGREEMENT is made and entered
into as of this 5th day of March, 2010,
by and among the Bankruptcy Estates of The SCO Group, Inc., a Delaware
corporation (“SCO
Group”), and SCO Operations, Inc., a Delaware corporation (“SCO Operations”) (SCO
Group and SCO Operations are sometimes collectively referred to herein as “SCO”),  by
and through Edward N. Cahn, solely in his capacity as Chapter 11 trustee for the
Bankruptcy Estates of SCO (collectively, “Pledgor”), and
______________________ (“Pledgee”).

       

      RECITALS:

       

      A.           Pledgee
and Pledgor have entered into that certain Secured Super-Priority Credit
Agreement, of even date herewith (the
“Credit
Agreement”), in connection with Pledgee’s making of a portion of a loan
in the amount of up to $2,000,000.00 to Pledgor (the “Loan”).

       

      B.           The
provisions of the Credit Agreement require that Pledgor execute certain
documents, including this Pledge Agreement, which provides for a lien and
security interest in favor of the Pledgee in certain of the assets and properties of the
Pledgor, whether now owned or hereafter acquired, as security for the
Loan.

       

      NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein
contained and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, Pledgor and Pledgee agree as
follows:

       

      ARTICLE
1

       

      DEFINITIONS

       

      Definitions.  Except
as otherwise defined herein, each of the capitalized terms appearing in this
Agreement shall have the meaning ascribed
or given to it in that certain Secured Super-Priority Credit Agreement, of even
date herewith, executed by and among the Borrower and Pledgee, as one of the
Lenders (the “Credit
Agreement”).  This provision shall apply to all capitalized
terms appearing hereinabove and hereinbelow.  In addition, unless
otherwise defined herein or in the Credit Agreement, each term used herein and
defined in the Uniform Commercial Code as enacted in the State of Delaware (“UCC”) shall have the
meaning given to such term in the UCC.  Each of the Lenders has
entered into a duplicate original of the Credit Agreement with
Borrower.

       

      ARTICLE
2

       

      OWNERSHIP.

       

      Pledgor
is the sole owner, beneficially and of record, of the shares identified on Exhibit “A” hereto
(the “Shares”),
in the companies identified thereon (collectively, the “Company”).  The
Shares are freely transferrable.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      ARTICLE
2

       

      COLLATERAL
FOR LOAN.

       

      The Loan
and Pledgor’s payment and performance under the Loan Documents are secured, in
part, by the pledge of all of the Shares.  The Credit Agreement, the
Note, and any amendments to such Note or replacements thereof, or substitutions
therefor, together with any additional promissory notes issued by Pledgor in
connection with the Loan to any present or future Pledgee, and any amendments
thereto, replacements thereof or substitutions therefor (collectively, the
“Note”);
certain other security instruments; and any other agreement, document or
instrument executed in connection with the Credit Agreement, and all exhibits
and schedules to any such agreements, documents or instruments, are hereinafter
collectively referred to as the “Loan
Documents.”

       

      ARTICLE
3

       

      PLEDGE AND SECURITY
INTEREST

       

      SECTION
3.1       To secure the prompt and complete
payment and performance when due of the Note and the other Loan Documents,
Pledgor hereby pledges, assigns, delivers and transfers to Pledgee, and grants
Pledgee a continuing security interest in, all of the following property and
rights and interests in property (the “Share
Collateral”):

       

      (a)          
all of Pledgor’s interest in the Shares;

       

      (b)          
all proceeds of any or all of the foregoing;

       

      (c)          
all rights of Pledgor to receive any indemnity, warranty or guarantee with
respect to the Shares;

       

      (d)         
all additions to and replacements of the Shares and all proceeds receivable or
received when any and all of the Shares are sold, collected, exchanged, or
otherwise disposed whether voluntarily or involuntary; and

       

      (e)         
any additional shares at any time or from time to time after the date hereof
acquired by the Pledgor in the Company (by purchase, distribution or otherwise)
shall form part of the Pledged Collateral and Pledgor will, at the request of
Pledgee: (i) confirm the pledge of such shares to Pledgee; and (ii) promptly
take all such other actions as necessary or desirable to perfect the security
interest therein under any law (including, without limitation, under the Uniform
Commercial Code as enacted in the State of Utah (the “UCC”)).

       

      ARTICLE
4

       

      EVIDENCE OF
SHARES

       

      Pledgor
shall immediately deliver to Pledgee any and all of the certificates evidencing
the Shares.  The Shares shall be accompanied by, as appropriate, (a)
undated, duly executed stock powers or similar instrument endorsed by Pledgor
either in blank or to Pledgee in a manner which Pledgee deems satisfactory; and
(b) such other instruments or documents as Pledgee shall request.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      ARTICLE
5

       

      PLEDGOR’S REPRESENTATIONS
AND WARRANTIES

       

      SECTION
5.1        Pledgor hereby represents and
warrants to Pledgee that:

       

      (a)           Pledgor
is the sole owner, beneficially and of record, of one hundred percent (100%) of
all of the issued and outstanding capital stock of Company.

       

      (b)           Section 3.12 of the
Credit Agreement is hereby incorporated herein.

       

      ARTICLE
6

       

      PLEDGOR’S
COVENANTS

       

      SECTION
6.1        Pledgor agrees that, until
such time as this Pledge Agreement shall cease to be in full force and effect
according to its terms:

       

      (a)           Defense of
Collateral.  Pledgor will defend the Pledged Collateral against
all claims and demands of all persons (other than Pledgee) claiming an interest
in any of the Pledged Collateral and will discharge or cause to be discharged
all liens on any or all of the Pledged Collateral, except for the security
interest under this Pledge Agreement and Liens permitted under the Credit
Agreement.

       

      (b)           Location of
Office.  Pledgor shall keep the office where it keeps its
records concerning the Pledged Collateral at the address specified in Article
18; or, upon thirty (30) days’ prior written notice to Pledgee, at such other
location in a jurisdiction where all actions required by Article 7 have been
taken with respect to the Pledged Collateral.

       

      (c)           Disposition of
Collateral.  Except as expressly permitted under the Credit
Agreement, prior to the payment in full of the Note, Pledgor shall not (i) sell,
assign (by operation of law or otherwise) or otherwise dispose of any of the
Share Collateral; or (ii) create or suffer to exist any lien upon or with
respect to any of the Pledged Collateral, except for the pledge, hypothecation
and security interest created by this Pledge Agreement.

       

      (d)           Jurisdiction of
Organization.  Pledgor will cause the Company at all times to
be a corporation organized under the laws of the State of
Delaware. 

       

      (e)           Voting
Rights.  Pledgor shall exercise any and all management, voting
and other consensual rights pertaining to the Organizational Documents and the
Company in a manner not in violation of the terms of this Pledge Agreement or
the Note.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (f)           Issuance of Additional
Interests.  Pledgor will not authorize the issuance by the
Company of any additional interests in the Company unless concurrently with such
issuance all such interests are made subject to the pledge
hereunder.

       

      ARTICLE
7

       

      CONTINUED PERFECTION OF
SECURITY INTEREST

       

      Pledgor
agrees that it will not take any actions or fail to perform any of its duties or
obligations under this Pledge Agreement that would cause Pledgee to cease to
have a first priority perfected security interest of the Pledged
Collateral.  Pledgor agrees, from time to time and at its expense, to
promptly execute and deliver all further instruments and documents, and take all
further action, that may be necessary, or that Pledgee may request in order to
perfect and protect the pledge, hypothecation and security interest granted or
purported to be granted hereby or to enable Pledgee to exercise and enforce its
rights and remedies hereunder with respect to the Pledged
Collateral.  Pledgor hereby further authorizes Pledgee to file one or
more financing or continuation statements, and amendments thereto, relative to
all or any part of the Pledged Collateral.

       

      ARTICLE
8

       

      VOTING
RIGHTS/DISTRIBUTIONS

       

      SECTION
8.1        So long as no Event of
Default shall have occurred and be continuing:

       

      (a)           Pledgor
shall be entitled to exercise any and all voting and/or consensual rights and
powers accruing to an owner of the Shares for any purpose not in violation of
the provisions of this Pledge Agreement or the Note; and

       

      (b)           Pledgor
shall be entitled to receive and retain all cash and other distributions payable
in respect of the Share Collateral.

       

      SECTION
8.2        Upon the occurrence and
during the continuance of an Event of Default and delivery of written notice by Pledgee
to Pledgor exercising Pledgee’s rights under this Section 8.2, all rights
of Pledgor to exercise the voting and consensual rights and powers described in
Section 8.1 above shall immediately cease and all such rights shall thereupon
automatically become vested in Pledgee.

       

      ARTICLE
9

       

      PLEDGEE APPOINTED AS
PLEDGOR’S

       

      IRREVOCABLE
ATTORNEY-IN-FACT

       

      Pledgor
hereby appoints Pledgee as Pledgor's attorney-in-fact with full power in
Pledgor's place and stead, in Pledgor's name or its own name and at Pledgor's
sole cost and expense, to execute, endorse and deliver any and all agreements,
assignments, pledges, instruments and any other writings, and to take any and
all other actions, which Pledgee may deem necessary or desirable to carry out
the terms and effect the purposes of this Pledge Agreement and to exercise fully
its rights and remedies hereunder, in each case upon the occurrence and during
the continuance of an Event of Default. Pledgor hereby ratifies all that Pledgee
and all its representatives shall lawfully do or cause to be done under this
power of attorney, which power is coupled with an interest and shall be
irrevocable until all obligations under the Loan Documents have been satisfied
and this Pledge Agreement has been terminated.  Pledgee shall not
exercise any of its rights under the power of attorney granted in this Article 9
until after the occurrence and during the continuance of  an
Event of Default.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      ARTICLE
10

       

      SECURITY INTEREST
ABSOLUTE

       

      SECTION
10.1               The
obligations of Pledgee under this Pledge Agreement are independent of any
guaranties, and a separate action or actions may be brought and prosecuted
against Pledgee to enforce this Pledge Agreement, irrespective of whether any
action is brought against a guarantor of the Note, or whether another party or
any guarantor of the Note is joined in any such action or
actions.  All rights of Pledgee and the pledge, hypothecation and
security interest hereunder, and all obligations of Pledgor hereunder, shall be
absolute and unconditional to the extent permitted by applicable law,
irrespective of:

       

      (a)           any
lack of validity or enforceability of any other agreement or instrument relating
thereto;

       

      (b)           any
change in the time, manner or place of payment of or in any other term of, all
or any of the Note, or any other amendment or waiver of or any consent to any
departure from the Note;

       

      (c)           any
taking, exchange, release or non-perfection of any other collateral, or any
taking, release or amendment or waiver of, or consent to departure from any
guaranty, for the Note;

       

      (d)           any
manner of application of the Pledged Collateral, or proceeds thereof, to the
Note, or any manner of sale or other disposition of any other collateral for the
Note or any other assets of Pledgor; or

       

      (e)           any
other circumstances which might otherwise constitute a defense available to, or
a discharge of, Pledgor or a third party grantor of a security
interest.

       

      ARTICLE
11

       

      PLEDGEE’S RIGHTS TO PERFORM
FOR PLEDGOR

       

      If
Pledgor shall at any time fail to perform or comply with any of its covenants
and agreements hereunder, Pledgee may (but shall not be required or obligated
to), upon reasonable advance written notice to Pledgor, take such action, in its
own name and capacity or as Pledgor's attorney-in-fact, as Pledgee shall deem
necessary or desirable to effect such performance or compliance.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      ARTICLE
12

       

      LIMITATION OF PLEDGEE’S
LIABILITY/REIMBURSEMENT OF EXPENSES

       

      SECTION
12.1               Pledgee
shall have no obligation to take, or refrain from taking, any action with
respect to the Share Collateral or Pledgor's rights and interests
therein.

       

      SECTION
12.2              Pledgor
shall pay or reimburse Pledgee (or cause Pledgee to be paid or reimbursed) on
demand for all reasonable out of pocket costs and expenses (including without
limitation reasonable attorneys' fees and legal expenses) paid or incurred by
Pledgee in connection with (a) the administration of this Pledge Agreement
during the existence of an Event of Default, and (b) the exercise and
enforcement of any of Pledgee’s rights, powers and remedies hereunder, including
without limitation its right to perform Pledgor's covenants and agreements
hereunder to the extent Pledgor fails to do so.

       

      ARTICLE
13

       

      DEFAULTS

       

      Each of
the Events of Default listed in the Credit Agreement shall constitute an Event
of Default hereunder.

       

      ARTICLE
14

       

      REMEDIES

       

      In
addition to the remedies outlined and provided for in the Credit Agreement,
Pledgee shall have the following remedies upon the occurrence of any Event of
Default:

       

      SECTION
14.1               Upon
the occurrence and during the continuance of an Event of Default:

       

      (a)           Pledgee
may, at any time and from time to time, exercise any and all rights and remedies
available to it (i) hereunder, under the Note, and under any of the other Loan
Documents, including without limitation those rights and remedies set out in
subsections (b) through (d) of this Section 14.1, and (ii) as a secured party
under the UCC and under any other applicable law or rule of law or
equity.  Should Pledgee elect to proceed by action at law or in equity
to foreclose its security interest in and sell any or all of the Share
Collateral, Pledgor waives (to the extent permitted by law) any rights it may
then have in connection therewith to require Pledgee to post bonds, sureties or
collateral security or to demand possession of any such Share Collateral pending
judgment therein.

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      (b)           To
the extent permitted by Applicable Law, Pledgee may sell, assign, transfer,
endorse and deliver all, or from time to time any part, of the Share Collateral
at public or private sale, over the counter or at any broker's board or
securities exchange, for cash, or credit or in exchange for other property, for
immediate or future delivery, without advertisement or notice (except as
provided in this subsection), and for such price and on such terms as Pledgee
deems appropriate, provided only that all aspects of any such disposition are
commercially reasonable within the requirements of the UCC, as defined and
supplemented by the standards and agreements set forth
herein.  Pledgor agrees that to the extent notice of the time and
place of any such public sale, or of the time after which Pledgee intends to
make any such private sale or other disposition, is required under the UCC, such
notice shall be deemed commercially reasonable if transmitted by any of the
means described in the documents related to the Loan not less than ten (10) days
prior thereto.  Pledgee shall not be obligated to effect any sale of
any or all of the Share Collateral, whether or not notice thereof has been
given, and may adjourn any public or private sale from time to time by
announcement at the time and place fixed for such sale, and such sale may be
held without further notice at the time and place to which it was so
adjourned.

       

      (c)           At
any such public sale, Pledgee shall be entitled to bid for and/or purchase the
Share Collateral then being sold and may pay the price thereof by credit against
the amounts then outstanding under the Loan Documents.  Any purchaser
of the Share Collateral (including Pledgee) shall take such item(s) free from
any right or claim of Pledgor, and Pledgor hereby waives, to the extent
permitted by the UCC and other applicable law, all rights of redemption and/or
to any stay, exemption or appraisal which Pledgor now has or may hereafter
acquire.

       

      (d)           The
proceeds of the sale or other disposition of the Pledged Collateral shall be
applied first, to that part consisting of Pledgee’s reasonable out of
pocket expenses (including, without
limitation, reasonable attorneys' fees and legal expenses) in preparing for
disposition and disposing of the Share Collateral and, to the extent not
previously reimbursed by Pledgor, in administering this Pledge Agreement and
exercising and enforcing its rights, powers and remedies hereunder, and second,
to the satisfaction of the then-outstanding amount of the indebtedness then
remaining unpaid under the Loan Documents.  Pledgee shall account to
Pledgor for any surplus, and Pledgor shall remain liable to Pledgee for any
deficiency until repaid in full.

       

      ARTICLE
15

       

      CUMULATIVE REMEDIES; NO
WAIVERS BY PLEDGEE

       

      All
rights, powers and remedies of Pledgee (a) under this Pledge Agreement, the
Note, and the Loan Documents; and (b) under the UCC and other applicable law,
are cumulative and except as otherwise expressly provided by law or in such
agreements may be exercised concurrently or in any order of
succession.  Pledgee’s failure to exercise or delay in exercising any
of such rights, powers and remedies shall not constitute or imply a waiver
thereof, nor shall Pledgee’s single or partial exercise of any such right, power
or remedy preclude its other or further exercise thereof, or the exercise of any
other right, power or remedy.  Pledgee’s cure of any Default shall not
constitute a waiver thereof, and its waiver of one Default shall not constitute
a waiver of any subsequent Default.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      ARTICLE
16

       

      PLEDGOR'S
WAIVERS

       

      SECTION
16.1              Pledgee’s
security interest in the Share Collateral shall be absolute and unconditional
regardless of the existence or occurrence of, and Pledgor expressly waives any
defense or discharge that might otherwise arise from, any of the
following:

       

      (a)           any
lack of validity or enforceability of this Pledge Agreement, the Note or any
other of the Loan Documents or other agreements or instruments relating hereto
or thereto or otherwise relating to the amounts owed; and

       

      (b)           to
the extent permitted by law, any other circumstance that might otherwise
constitute a defense available to, or a discharge of, Pledgor in respect of the
amounts owed or this Pledge Agreement.

       

      ARTICLE
17

       

      TERMINATION/RELEASE OF
PLEDGED COLLATERAL

       

      This
Pledge Agreement and the security interest granted hereunder shall terminate on
the date on the Note has been satisfied in full and all obligations under the
Loan Documents have been fully and absolutely performed (other than contingent
indemnification obligations and obligations with respect to the Loan
Fee).  Pledgee shall thereupon reassign and redeliver (or cause to be
reassigned and redelivered) to Pledgor or such person(s) as Pledgor shall
designate in writing, against due execution and delivery by Pledgor or such
person(s) of a receipt therefor reasonably satisfactory to Pledgee in form
and substance, the Shares (if any) as are then held by Pledgee, together with
appropriate instruments of reassignment and release.  Any such
reassignment shall be without recourse to or warranty by Pledgee and at the
expense of Pledgor.

       

      ARTICLE
18

       

      MISCELLANEOUS

       

      SECTION
18.1           Notices.  Section
8.01 of the Credit Agreement is hereby incorporated into this Pledge
Agreement.

       

      SECTION
18.2            
Binding
Agreement/Assignment.  Sections 8.03 and 8.04 of the Credit
Agreement is hereby incorporated herein.

       

      SECTION
18.3            
Survival.  Each
of the representations and warranties shall survive the execution and delivery
of this Pledge Agreement and delivery of the Pledged Collateral to the
Pledgee.

       

      SECTION
18.4            
Severability.  Section
8.09 of the Credit Agreement is hereby incorporated herein.

       

      SECTION
18.5            Governing
Law.  This Pledge Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware to the fullest extent
permitted by law, except to the extent that perfection (and the effect of
perfection and non-perfection) and certain remedies may be governed by the laws
of any jurisdiction other than the State of Delaware.

       

      
        
          
          

        

        
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      SECTION
18.6             Amendments/Modification.  Section
8.07 of the Credit Agreement is hereby incorporated herein.

       

      SECTION
18.7             Waiver of Right to Jury
Trial. Section 8.10 of the
Credit Agreement is hereby incorporated herein.

       

      SECTION
18.8              Collateral Agent
Agreement.  Pledgor acknowledges and agrees that Pledgee, as
Agent and alone, shall have the right to enforce all Lenders’ rights relating to
the Collateral under the Loan Documents and under duplicate originals of all of
the Loan Documents executed by the Lenders (other than the Lender) and
Pledgor.

       

      SECTION
18.9             Counterparts/Facsimiles.  Section
8.12 of the Credit Agreement is hereby incorporated herein.

       

      SECTION
18.10            No Personal Liability for
Trustee.  Section 8.17(a) of the Credit Agreement is
incorporated herein.

       

      SECTION
18.11            Consent to Jurisdiction and
Service of Process.  Section 8.14 of the Credit Agreement is
hereby incorporated herein.

       

      SECTION
18.12            Costs and Attorneys’
Fees.  Pledgor will, upon demand, pay to Pledgee the amount of
any and all reasonable out of pocket expenses, including the reasonable
attorneys’ fees and expenses of counsel for Pledgee, and of any experts and
agents which Pledgee may incur in connection with: (a) the administration of
this Pledge Agreement upon the occurrence and during the continuance of an Event
of Default; (b) the collection, retaking, storage, custody, preservation, use or
operation of, preparing for sale, selling or other disposition and delivery,
collection from, or other realization upon, any of the Collateral upon the
occurrence and during the continuance of an Event of Default; (c) the exercise
or enforcement of any of the rights of Pledgee hereunder; or (d) the failure by
Pledgor to perform or observe any of the provisions hereof.


       

      [SIGNATURES
APPEAR ON THE FOLLOWING PAGE]

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, Pledgor and Pledgee duly executed this Pledge Agreement as of
the date first written above.

       

      
        
          
            
              
                
                  	
                          PLEDGOR:

                        	 
      
	 
      	
                          Edward
      N. Cahn, in His Sole Capacity as Trustee of the Bankruptcy Estates of The
      SCO Group, Inc., a Delaware corporation and SCO Operations, Inc., a
      Delaware
corporation

                        


                

              

            

          

        

      

      


      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  PLEDGEE:

                                	 	 
      


                        

                      

                    

                  

                   

                  
                    	 
      	
                            By:

                          	 
      
	 
      	
                            Name:

                          	 
      
	 
      	
                            Title:

                          	 
      


                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      Exhibit
“A”

      The
Shares

      
        
          
            
              
                
                  
                    
                      	
                              Company Name

                            	 	
                              State of
Incorporation

                            	 	
                              Date of Articles
of Incorporation

                            	 	
                              Date of

                              By-Laws

                            	 	
                              Number

                              of Shares

                            	 	
                              Certificate
Numbers

                            
	
                              1. SCO Operations,
      Inc.

                            	 	
                              Delaware

                            	 	 
      	 	 
      	 	 
      	 	 
      
	
                              2. Me,
    Inc.

                            	 	 
      	 	 
      	 	 
      	 	 
      	 	 
      
	
                              3. SCO Global,
      Inc.

                            	 	 
      	 	 
      	 	 
      	 	 
      	 	 
      
	
                              4. Cattleback
      Intellectual Property Holdings, Inc.

                            	 	 
      	 	 
      	 	 
      	 	 
      	 	 
      


                    

                  

                

              

            

          

        

      

      


      
        
          
          

        

        
          11