IBM's Investment in Novell

Agreement enables IBM to ship SUSE LINUX Enterprise Server across its servers Novell will develop and support SUSE LINUX on IBM platforms SALT LAKE CITY (BrainShare® 2004) — Novell today announced an agreement with IBM enabling IBM to ship SUSE® LINUX Enterprise Server, which customers license from Novell, with IBM’s servers. This agreement will provide Novell an exciting new channel to supply SUSE LINUX to businesses around the world. As part of today’s agreement, IBM can ship, or preload, SUSE LINUX Enterprise Server across its entire server line, including IBM eServer iSeries, pSeries, xSeries, and zSeries, as well as IBM’s eServer BladeCenter systems.* The parties have extended IBM’s existing agreement with SUSE LINUX, and Novell will continue to develop and support SUSE LINUX on all IBM server platforms. “The momentum behind Linux in the marketplace continues to grow,” said Jack Messman, chairman and CEO of Novell. “Novell is working with companies like IBM to deliv...

IBM to purchase $50 million in Novell convertible preferred shares SALT LAKE CITY (BrainShare® 2004) — Novell today announced it has signed a definitive agreement with IBM in connection with IBM’s previously announced $50 million investment in Novell. Publicized in conjunction with Novell’s offer to acquire SUSE® LINUX in November 2003, the investment, the primary terms of which were negotiated in November 2003, entails the purchase by IBM of Novell Series B convertible preferred shares that are convertible into 8 million shares of Novell common stock at a price of $6.25 per share. The Series B convertible preferred shares are entitled to a dividend of 2% per annum, payable quarterly in cash. Due to an increase in Novell’s common stock price since November 2003, Novell expects to record a one-time, non-cash deemed dividend of approximately $26 million attributable to the value of the preferred stock’s conversion feature. This beneficial conversion feature will have no imp...