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Exhibit 10.12  


 
 

COMMON STOCK WARRANT
  CALDERA INTERNATIONAL, INC.    
    





NEITHER
THIS WARRANT NOR THE SHARES OF STOCK ISSUABLE UPON EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"). NO SALE, TRANSFER OR OTHER DISPOSITION OF THIS WARRANT OR SAID SHARES MAY BE EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO, (ii) AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACT OR (iii) RECEIPT OF A
NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION TO THE EFFECT THAT REGISTRATION UNDER THE ACT IS NOT REQUIRED. THE WARRANT EVIDENCED HEREBY IS NON-TRANSFERABLE. 


Right
to Purchase 210,000

Shares of Common Stock 


        Caldera
International, Inc., a Delaware corporation (the "Company"), hereby certifies that, for value received, Sun
Microsystems, Inc., a Delaware corporation ("Sun"), or any transferee to whom this warrant (the
"Warrant") is properly transferred in accordance with Section 3(c) below (Sun or any such transferee, the
"Holder"), is entitled, on the terms set forth below, to purchase from the Company at any time during the period commencing on March 11, 2003
(the "Exercisability Date") and, subject to the provisions of Section 1 below, ending at 5:00 p.m., Pacific time, on March 11,
2008, 210,000 fully paid and nonassessable shares of the common stock, par value $0.001 per share (the "Warrant Shares"), of the Company, at a price of
$1.83 per share, subject to adjustments as provided below (the "Purchase Price"). As used herein, the term
"Stock" shall mean the Company's presently authorized common
stock or any stock into or for which such common stock may hereafter be converted or exchanged prior to or concurrent with the exercise of this Warrant. 


	1.
	Expiration. This Warrant shall expire upon the first to occur of the following: (i) 5:00 p.m., Pacific time, on
March 11, 2008; and (ii) the sale of all or substantially all of the assets of the Company or an acquisition of the Company by another corporation or entity by consolidation, merger or
other reorganization or series of related transactions in which the holders of the Company's outstanding voting stock immediately prior to such transaction own, immediately after such transaction,
securities representing less than fifty percent (50%) of the voting power of the surviving corporation, the surviving entity or the entity that controls such surviving entity (such sale of assets or
acquisition, a "Merger or Consolidation").



	2.
	Exercise of Warrant.
	(a)
	Exercisability of the Warrant. This Warrant will become exercisable on the Exercisability Date.



	(b)
	Full Exercise. This Warrant may be exercised by the Holder at any time during the period commencing on the Exercisability Date and
ending upon its expiration for the full number of Warrant Shares by surrendering this Warrant and the Notice of Exercise attached hereto as  Exhibit A properly endorsed to the Company's principal
office, accompanied by payment in cash, by check or by wire transfer in an amount equal to
the product of the Purchase Price and the number of Warrant Shares indicated on the face of this Warrant.



	(c)
	Net Issue Exercise. In lieu of exercising this Warrant pursuant to Section 2(b) above, the Holder may elect to receive a
number of shares equal to the value (as determined below) of this Warrant by surrender of this Warrant at the principal office of the Company together with 








 


Notice
of Exercise. In such event, the Company shall issue to the Holder a number of shares computed using the following formula: 






	 	 	X	 	=	 	Y(A-B)
 A	 	 





	where X =	 	the number of Shares to be issued to the Holder.
	Y =	 	the number of Shares subject to this Warrant.
	A =	 	the fair market value of one share of the Company's common stock as determined by taking the average of the closing price for the ten most recent trading days ending on the date of exercise.
	B =	 	the Exercise Price (as adjusted to the date of such calculation).






	(d)
	Taxes. The Company will not be required to pay any tax imposed in connection with any transfer involved in the issuance of a Warrant or
a certificate for shares of Stock in any name other than that of the original holder hereof, and in such case, the Company will not be required to issue or deliver any stock certificate or warrant
until such tax is paid. 




        3.     Representations and Covenants of the Holder. This Warrant has been issued by the Company in reliance upon the following
representations and covenants of the Holder: 



	(a)
	Investment Purpose. The Stock issuable upon exercise of the Holder's rights contained herein will be acquired for investment and not
with a view to the sale or distribution of any part thereof, and the Holder has no present intention of selling or engaging in any public distribution of the same except pursuant to a registration or
exemption.



	(b)
	Private Issue. The Holder understands (i) that the Stock issuable upon exercise of this Warrant is not registered under the Act
or qualified under applicable state securities laws on the ground that the issuance contemplated by this Warrant will be exempt from the registration and qualifications requirements thereof, and
(ii) that the Company's reliance on such exemption is predicated on the representations set forth in this Section 3.



	(c)
	Disposition of Holder's Rights. This Warrant and all rights hereunder are non-transferable;  provided, however, that the Holder may transfer this Warrant and the rights hereunder, in part or whole, to any subsidiary, parent, affiliate, general
partner or limited partner of the Holder. 



The
Stock issuable upon exercise of this Warrant is non-transferable, except in accordance with the terms of this provision. Notwithstanding the foregoing, the restrictions imposed upon
the transferability of shares of the Stock do not apply to transfers by the Holder, in part or whole, to any subsidiary, parent, affiliate, general partner or limited partner of the Holder, and shall
terminate as to any particular share of Stock when (1) the transfer of such security shall have been effectively registered under the Act and transferred by the Holder thereof in accordance
with such registration, or (2) such security shall have been sold without registration in compliance with Rule 144 under the Act or (3) a letter shall have been issued to the
Holder at its request by the staff of the Securities and Exchange Commission or a ruling shall have been issued to the Holder at its request by such Commission stating that no action shall be
recommended by such staff or taken by such Commission, as the case may be, if such security is transferred without registration under the Act in accordance with the conditions set forth in such letter
or ruling and such letter or ruling specifies that no subsequent restrictions on transfer are required. Whenever the Stock issuable upon exercise of this Warrant may be sold pursuant to
Rule 144(k), the restrictions imposed herein shall terminate, the Holder or holder of a share of Stock issued upon exercise of this Warrant as to which such restrictions have terminated shall
be entitled to receive from the Company, 




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without
expense to such holder, one or more new certificates for the Warrant or for such shares of Stock not bearing any restrictive legend. 



	(d)
	Financial Risk. The Holder has such knowledge and experience in financial and business matters as to be capable of evaluating the
merits and risks of its investment, and has the ability to bear the economic risks of its investment.



	(e)
	Risk of No Registration. The Holder understands that if a registration statement covering the transfer of the Stock under the Act is
not in effect when it desires to sell the Stock issuable upon exercise of this Warrant, it may be required to hold such securities for an indefinite period. The Holder also understands that any sale
of Stock issuable upon exercise of this Warrant which might be made by it in reliance upon Rule 144 under the Act may be made only in accordance with the terms and conditions of that Rule. 




        4.     Delivery of Stock Certificates on Exercise. Promptly after the exercise of this Warrant and the
payment of the Purchase Price pursuant to Section 2(b) or after the net exercise of this Warrant pursuant to Section 2(c), the Company will issue to the Holder or upon the order
of the Holder hereof, a certificate or certificates for the number of whole shares of Stock to which the Holder is entitled; provided, however, that
(i) the Holder shall have furnished to the Company at the time of such exercise a signed Investment Representation Statement substantially in the form attached hereto as  Exhibit B and
(ii) the Company will place on each certificate the following legend: 




"THE
SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"). THESE SECURITIES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER THE ACT." 


Furthermore,
the Company will place on each certificate any legend required by any applicable state blue sky law. 





        5.     Adjustments for Dividends in Other Stock or Property; Reclassifications. The Purchase Price and
the number and type of Warrant Shares and/or other property issuable upon exercise of this Warrant shall be appropriately and proportionately adjusted to reflect any stock dividend, stock split,
combination of shares, reclassification, recapitalization, any corporate reorganization other than as provided in Section 1 hereof or other similar event affecting the number or character of
outstanding Warrant Shares, so that the number and type of securities and/or other property issuable upon exercise of this Warrant shall be equal to that which would have been issuable with respect to
the number of Warrant Shares subject hereto at the time of such event, had such Warrant Shares then been outstanding. 


        6.     Certificate as to Adjustments. In each case of an adjustment in the Purchase Price or in the
shares of Stock or other stock, securities or property receivable on the exercise of the Warrant, the Company, at its expense, will compute such adjustment in accordance with the terms of the Warrant
and prepare a certificate setting forth such adjustment and showing in detail the facts upon which the adjustment is based. The Company will mail a copy of each such certificate to the Holder of the
Warrant outstanding at that time. 


        7.     Notices of Record Date. In case (i) the Company takes a record of the holders of its Stock
(or other stock or securities at the time receivable upon the exercise of the Warrant) for the purpose of entitling them to receive any dividend or other distribution, or any right to subscribe for or
purchase any shares of stock of any class or any other securities; or (ii) of any capital reorganization of the Company, any reclassification of the common stock of the Company, any
consolidation or merger of the Company with or into another corporation, including, without limitation, any Merger or Consolidation, or any conveyance of all or substantially all of the assets of the
Company to another 


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corporation;
or (iii) of any voluntary dissolution, liquidation or winding-up of the Company; then, in each such case, the Company will mail or cause to be mailed to each Holder of
a Warrant at the time outstanding a notice specifying, as the case may be, (a) the date on which a record is to be taken for the purpose of such dividend, distribution or right, and stating the
amount and character of such dividend, distribution or right, or (b) the date on which such reorganization, reclassification, consolidation, merger, conveyance, dissolution, liquidation or
winding-up is to take place, and time, if any is to be fixed, as of which the holders of record of Stock (or such other stock or securities at the time receivable upon the exercise of the
Warrant) will be entitled to exchange their shares of Stock (or such other stock or securities) for securities or other property deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding-up, and, in the case of a reorganization, consolidation, merger or conveyance, the fair market value of such securities or other
property as determined by the Board of Directors of the Company. Such notice shall be mailed at least ten (10) days prior to the date specified therein; provided, however, that in the event of
a Merger or Consolidation the Company shall use its best efforts to provide such notice in accordance with Section 11 below at least twenty-one (21) days prior to the closing
date of such Merger or Consolidation and, in any event, shall provide such notice in accordance with Section 11 below at least fifteen (15) days prior to such closing date. 


        8.     Reservation of Stock Issuable on Exercise of Warrant. The Company will at all times reserve and
keep available, solely for issuance and delivery upon the exercise of this Warrant, all such shares of Stock and other stock, or such other stock, securities and property as from time to time are
receivable upon the exercise of the Warrant. 


        9.     Exchanges of Warrant. Subject to the provisions of Section 3(c) above, upon surrender for
exchange of this Warrant (in negotiable form, if not surrendered by the Holder named on the face thereof) to the Company at its principal office, the Company, at its expense, will issue and deliver a
new Warrant or Warrants exercisable in the aggregate for the same number of shares of Stock, in the denomination or denominations requested, to or on the order of such Holder upon payment by such
Holder of any applicable transfer taxes; provided, however, that any transferee of the Warrant shall be required to make the representations set forth
in Exhibit B attached hereto. 


        10.   Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the Company of the
loss, theft, destruction or mutilation of this Warrant and (in the case of loss, theft or destruction) upon delivery of an indemnity agreement in such reasonable amount as the Company may determine,
or (in the case of mutilation) upon surrender and cancellation thereof, the Company at its expense, will issue a replacement warrant in substantially identical form to this Warrant. 


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        11.   Notices. Any notices, demand, offer, request or other communication required or permitted to be
given by either the Company or a Holder (collectively, a "Notice") pursuant to the terms of this Agreement, if delivered to the Holder, shall be sent to the following address: 



	Sun Microsystems, Inc.

4150 Network Circle

Santa Clara, California 95054	 	 
	Attention:	 	 
	Telephone:	 	(408) 276-        	 	 
	Facsimile:	 	(408) 276-        	 	 
	

With a copy to:	
 	

 
	

	
 	

 
	

	
 	

 
	

	
 	

 







or
at such other addresses provided to the Company or such other address as a party may request by notifying the other in writing. 



	(a)
	Any
Notice shall be delivered in writing. Any such Notice shall be deemed effectively given the earlier of (i) when received, (ii) when delivered personally,
(iii) one (1) business day after being delivered by facsimile (with receipt of appropriate confirmation), (iv) one (1) business day after being deposited with an overnight
courier service and (v) four (4) days after being deposited in the U.S. mail, First Class with postage prepaid.






	12.
	Change; Waiver. Neither this Warrant nor any term hereof may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by the party against which enforcement of the change, waiver, discharge or termination is sought.



	13.
	No Fractional Shares or Script. No fractional shares or script representing fractional shares shall be issued
upon the exercise of this Warrant, but in lieu of such fractional shares the Company shall make a cash payment therefor upon the basis of the Purchase Price then in effect.



	14.
	No Rights as Stockholder. This Warrant does not entitle the Holder to any voting rights or other rights as a
stockholder of the Company prior to the exercise of this Warrant.



	15.
	Headings. The headings in this Warrant are for purposes of reference only and shall not be deemed to constitute
a part hereof.



	16.
	Counterparts. This Warrant may be executed in two or more counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.



	17.
	Governing Law. This Warrant is delivered in the State of Delaware and shall be construed in accordance with and
governed by the laws of such state. 


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	18.
	Confidentiality; No Public Disclosure. The terms and conditions of this Warrant are confidential. The Holder shall not make any public
disclosure concerning the terms and conditions of this Warrant without the prior written consent of the Company. 






	Dated: March     , 2003	 	CALDERA INTERNATIONAL, INC.
	

 	
 	

/s/  DARL MCBRIDE      
Signature of Authorized Signatory
	

 	
 	

Darl McBride, CEO
Print Name and Title
	
Agreed and accepted:	
 	

 
	

Dated: March     , 2003	
 	
SUN MICROSYSTEMS, INC.
	

 	
 	

/s/  BRIAN SUTPHIN      
Signature of Authorized Signatory
	

 	
 	

Brian Sutphin, Vice President
Print Name and Title




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EXHIBIT A
  NOTICE OF EXERCISE    
    


TO: CALDERA INTERNATIONAL, INC.  


        1.     The
undersigned hereby elects to purchase                          shares of Common Stock of Caldera International pursuant to
the
terms of the attached Warrant. 


        2.     Exercise
(Please initial the blank): 



	
	 	The undersigned elects to exercise the attached Warrant by means of a cash payment, and tenders herewith payment in full for the purchase price of the shares being purchased, together with all applicable transfer taxes,
if any.
	

	
 	

The undersigned elects to exercise the attached Warrant by means of a net issue exercise pursuant to Section 2(c) of the Warrant.






	3.
	Please
issue a certificate, or certificates representing said shares of stock, in the name of the undersigned or in such other name as are specified below: 







	 	 	
 (Name)	 	 
	 	 	
	 	 
	 	 	
 (Address)	 	 





	4.
	The
undersigned represents that the aforesaid shares of stock are being acquired for the account of the undersigned for investment and not with a view to, or for resale in connection
with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares. In support thereof, the undersigned has executed an Investment Representation
Statement attached hereto as Exhibit B. 





	

 	
 	

Name of Warrantholder
	

 	
 	

Signature of Authorized Signatory
	

 	
 	

Print Name and Title
	

 	
 	

Date




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EXHIBIT B
  INVESTMENT REPRESENTATION STATEMENT    
    


                                 Shares of Common
Stock

of Caldera International, Inc. 


        In
connection with the acquisition of the above-listed securities the undersigned hereby represents to Caldera International, Inc. (the
"Company") as follows: 


	1.
	The
stock to be received upon the exercise of the Warrant will be acquired for investment for its own account, not as a nominee or agent, and not with a view to the sale or
distribution of any part thereof, and it has no present intention of selling, granting participation in or otherwise distributing the same, but subject, nevertheless, to any requirement of law that
the disposition of its property shall at all times be within its control. By executing this Statement, the undersigned further represents that it does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer, or grant participations to such person or to any third person, with respect to the stock acquired upon exercise of the Warrant.



	2.
	The
undersigned understands that any stock acquired upon exercise of the Warrant at the time of issuance may not be registered under the Securities Act of 1933, as amended (the
"Act"), and applicable state securities laws on the ground that the issuance of securities is exempt pursuant to Section 4(2) of the Act,
and state law exemptions relating to offers and sales not by means of a public offering and that the Company's reliance on such exemptions is predicated on the undersigned's representations set forth
herein.



	3.
	The
undersigned agrees that in no event will it make a disposition of any stock acquired upon the exercise of the Warrant unless and until (i) it shall have notified the Company
of the proposed disposition and shall have furnished the Company with a statement of the circumstances surrounding the proposed disposition, and (ii) if requested by the Company, it shall have
furnished the Company with an opinion of counsel satisfactory to the Company and its counsel to the effect that (A) appropriate action necessary for compliance with the Act and any applicable
state securities laws has been taken or an exemption from the registration requirements of the Act and such laws is available, and (B) that the proposed transfer will not violate any of said
laws.



	4.
	The
undersigned represents that it is able to fend for itself in connection with its purchase of stock as contemplated by this Statement, has such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and risks of its investment and that it has the ability to bear the economic risks (including the risk of a total loss) of its
investment.



	5.
	The
undersigned acknowledges that the stock acquired upon exercise of the Warrant must be held indefinitely unless subsequently registered under the Act or an exemption from such
registration is available. The undersigned is aware of the provisions of Rule 144 promulgated under the Act which permit limited resale of shares purchased in a private placement subject to the
satisfaction of certain conditions, including, among other things, the existence of a public market for the shares, the availability of certain current public information about the Company, the resale
occurring not less than one year after a party has purchased and paid for the security to be sold, the sale being through a "broker's transaction" or in transactions directly with a "market maker" 


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(as
provided by Rule 144(f)) and the number of shares being sold during any three-month period not exceeding specified limitations. 





	

 	
 	

Name of Warrantholder
	

 	
 	

Signature of Authorized Signatory
	

 	
 	

Print Name and Title
	

 	
 	

Date




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COMMON STOCK WARRANT CALDERA INTERNATIONAL, INC.


EXHIBIT A NOTICE OF EXERCISE

EXHIBIT B INVESTMENT REPRESENTATION STATEMENT