The Lawsuit and SCOs
Financial Picture"> "Boies, Schiller & Flexner is now moving beyond the contract issues we have with IBM. The firm will be enforcing and defending SCOs intellectual property rights, including the protection of our Unix System V source code and our copyrights that were reaffirmed as a result of the BSDI settlement agreement," McBride said. As a result of the share issuance, SCO anticipates a charge to earnings of some $8,96 million in its fourth quarter that ended October 31, 2003. This $8,96 million charge to earnings is comprised of non-cash expense of $7,96 million related to the issuance of the 400,000 shares of common stock and the $1 million cash expense.The beneficial conversion feature represents the intrinsic value of the difference in the Series A conversion price of $16.93 per share and the closing market price of SCOs common stock on October 16, 2003 of $19.89 per share. In addition to the stated dividend rate, dividends on the Series A Convertible Preferred Stock will accrue on the difference between the stated dividend rate and 12 percent per annum. These dividends will reduce earnings available to common stockholders if or when incurred," McBride said. In line with its previous guidance, SCO said it now expected revenue for its fourth quarter ended October 31, 2003 to be between $22 million and $25 million. Discuss This in the eWEEK Forum
Additionally, SCO anticipates recording a non-cash charge for the beneficial conversion feature related to the issuance of the Series A Convertible Preferred Stock of approximately $8,74 million in the fourth quarter that ended October 31, 2003.