Recent SCO/Linux News

From: Avi Dines <amendoza@schwartz-pr.com>
Subject: SCO Terminates Sequent-IBM UNIX License
Date: Wed, 13 Aug 2003 12:46:19 GMT

IBM's Disregard of Sequent's Contract With SCO Leads to Final Termination
of UNIX License

LINDON, Utah - Aug. 13 - The SCO(R) Group (SCO)(Nasdaq: SCOX) delivered
final written notice yesterday to Sequent Computer Systems for termination
of its UNIX System V software contract. Sequent is now owned by IBM. The
Sequent (IBM) contract was terminated for improper transfer of Sequent's
UNIX source code and development methods into Linux.  As a result, IBM no
longer has the right to use or license the Sequent UNIX product known as
"Dynix/ptx." Customers may not acquire a license in Dynix/ptx from today's
date forward.

SCO's System V UNIX contract allowed Sequent to prepare derivative works
and modifications of System V software "provided the resulting materials
were treated as part of the Original [System V] software." Restrictions on
use of the Original System V Software include the requirement of
confidentiality, a prohibition against transfer of ownership, and a
restriction against use for the benefit of third parties. Sequent-IBM has
nevertheless contributed approximately 148 files of direct Sequent UNIX
code to the Linux 2.4 and 2.5 kernels, containing 168,276 lines of code.
This Sequent code is critical NUMA and RCU multi-processor code previously
lacking in Linux. Sequent-IBM has also contributed significant UNIX-based
development methods to Linux in addition to the direct lines of code
specified above.  Through these Linux contributions, Sequent-IBM failed to
treat Dynix as part of the original System V software, and exceeded the
scope of permitted use under its UNIX System V contract with SCO.

SCO gave Sequent-IBM two months written notice prior to termination, as
required by contract. IBM failed to cure its breach of the Sequent-IBM
contract, or to offer any solution whatsoever to cure its breach. SCO's
termination of the Sequent-IBM UNIX System V license is self-effectuating
and does not require court approval. SCO previously terminated IBM's right
to use or license IBM's UNIX product known as AIX. From and after June 16,
2003, customers no longer have the legal right to acquire new AIX licenses.

About SCO

The SCO Group (Nasdaq: SCOX) helps millions of customers in more than 82
countries to grow their businesses everyday. Headquartered in Lindon, Utah,
SCO has a worldwide network of more than 11,000 resellers and 4,000
developers. SCO Global Services provides reliable localized support and
services to partners and customers. For more information on SCO products
and services, visit http://www.sco.com.

SCO, and the associated SCO logo are trademarks or registered trademarks of
The SCO Group, Inc. in the U.S. and other countries. UNIX is a registered
trademark of The Open Group. All other brand or product names are or may be
trademarks of, and are used to identify products or services of, their
respective owners.

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