Novell, Inc.

A shareholder derivative complaint has been filed in the United States District Court, District of Massachusetts against certain past and present executive officers and directors of Novell. In August 2006, Novell disclosed it had initiated a voluntary review of its historical stock based compensation practices and the related potential accounting impact. In early September 2006, Novell's director announced his resignation from the Board of Directors and soon after Novell notified the Securities and Exchange Commission of its inability to file its quarterly report for the period ended July 31, 2006. In late September 2006, Novell announced it had received a staff determination notice from the Nasdaq Stock Market stating that the Company's common stock was subject to delisting.