Certificate of Incorporation - Caldera Systems Inc.


                          CERTIFICATE OF INCORPORATION
                                       OF
                              CALDERA SYSTEMS, INC.

        The undersigned, a corporation (the 'Sole Incorporator'), for the
purpose of organizing a corporation to conduct the business and promote the
purposes thereinafter stated, under the provisions and subject to the
requirements of the Delaware General Corporation Law (the 'DGCL') hereby
certifies the following:

                                    ARTICLE I

        The name of the Corporation is Caldera Systems, Inc. (the
'Corporation').

                                   ARTICLE II

        The address of the registered office of the Corporation in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, City of Wilmington,
County of New Castle, and the name of the registered agent at such address is
The Corporation Trust Company.

                                   ARTICLE III

        The nature of the business or purposes to be conducted or promoted is to
engage in any lawful act or activity for which corporations may be organized
under the DGCL.


                                   ARTICLE IV

        The name and mailing address of the Sole Incorporator is as follows:

                              Caldera Systems, Inc.
                            Attention: Ransom H. Love
                      President and Chief Executive Officer
                             240 West Center Street
                                 Orem, UT 84057

                                    ARTICLE V

        The total number of shares of capital stock which the Corporation shall
have authority to issue is one hundred million of which twenty-five million
shall be shares of preferred stock, (hereinafter called the 'Preferred Stock'),
and seventy-five million shall be shares of common stock, (hereinafter called
the 'Common Stock'). The Preferred Stock shall have a par value of one-tenth of
one cent ($0.001) and the Common Stock shall have a par value of one-tenth of
one cent ($0.001) per share.

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        The designation, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof, of each class of stock, and the express grant of authority
to the Board of the Corporation (the 'Board') to amend this Certificate of
Incorporation to fix the designation, powers, preferences and relative,
participating, optional or other special rights, and qualifications, limitations
or restrictions thereof, of each share of the Preferred Stock which are not
fixed by this Certificate of Incorporation, are as follows:

A.      PREFERRED STOCK

        1. Designation; Consideration.

        (a) Designation. There are hereby created out of the authorized and
unissued shares of Preferred Stock of the Corporation (i) a series of Preferred
Stock designated as the 'Series A Convertible Preferred Stock,' which series
shall consist of 6,596,146 shares of Series A Convertible Preferred Stock and
(ii) a series of Preferred Stock designated as the 'Series B Convertible
Preferred Stock,' which series shall consist of 5,000,000 shares of Series B
Convertible Preferred Stock. Shares of the Series A Convertible Preferred Stock
are referred to hereinafter as the 'Series A Preferred.' Shares of Series B
Convertible Preferred Stock are referred to hereinafter as the 'Series B
Preferred,' and together with the Series A Preferred, the 'Preferred Stock.'
Once duly issued for the consideration called for by resolution of the Board,
shares of the Preferred Stock shall be deemed fully paid and nonassessable.

        (b) Restrictions on Reissuance. All shares of the Preferred Stock,
purchased, redeemed, converted into Common Stock (as provided herein) or
otherwise acquired by the Corporation shall be retired and canceled and shall
not be reissued.

        (c) Stated Value Per Share. The initial 'Series A Stated Value Per
Share' shall be $4.03 per share. The initial 'Series B Stated Value Per Share'
shall be $6.00 per share.

        (d) Rank. The Series A Preferred and Series B Preferred shall, with
respect to dividend rights, rights upon liquidation, winding up or dissolution,
and redemption rights, rank on parity with each other and prior to any other
class or series of capital stock of the Corporation, including, without
limitation, all classes of the Common Stock and any other series of the
preferred stock hereinafter created. (All of such classes or series of capital
stock of the Corporation to which the Preferred Stock ranks prior, including,
without limitation, other series of Preferred Stock, the Common Stock, and
including, without limitation, junior securities convertible into or
exchangeable for other junior securities or phantom stock representing junior
securities, are collectively referred to herein in this Section V.A. as 'Junior
Securities.').

        2. Dividends.

        (a) General Obligation. Subject to the provisions of this Paragraph
V.A.2.(a), the record holders of the Preferred Stock shall be entitled to
receive when, as and if declared by the Board and to the extent permitted under
the DGCL, to cumulative and accruing preferential dividends on the shares of
Preferred Stock outstanding, at the rate per share with respect to the Series A
Preferred of 8% per annum, compounded annually, of the Series A Stated Value Per
Share (the 'Series A Accruing Dividends') and at the rate per share with respect
to the Series B

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Preferred of 8% per annum, compounded annually, of the Series B Stated Value Per
Share (the 'Series B Accruing Dividends' and together the with Series A Accruing
Dividends, the 'Accruing Dividends'); provided, however, solely for purposes of
this Paragraph 2(a), the Series A Stated Value Per Share shall be deemed to be
$6.00 (subject to adjustment as provided herein). No dividends shall be paid on
any share of Common Stock unless a dividend (including the Accruing Dividends)
is paid with respect to all outstanding shares of Preferred Stock in an amount
for each such share of Preferred Stock equal to or greater than the aggregate
amount of such dividends for all shares of Common Stock into which each such
share of Preferred Stock could then be converted.

        (b) Payment of Dividends. Any dividend on the Preferred Stock declared
but unpaid as provided in Paragraph V.A.2.(a) shall be paid in cash or property
as determined by the Board. Dividends may be declared and paid at any time to
the holders of record on the record date for such dividend payment.

        (c) Non-Cash Dividends. Whenever a dividend of the Corporation shall be
payable in property other than cash, the value of such dividend shall be deemed
to be the fair market value of such property as determined in good faith by the
Board.

        3. Liquidation.

        (a) General. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, each holder of shares of Series A
Preferred and Series B Preferred then outstanding shall be entitled to receive,
on a pari passu basis based on the Series A Stated Value Per Share and Series B
Stated Value Per Share, as the case may be, out of the assets of the Corporation
legally available for distribution to the shareholders of the Corporation
(whether representing capital or surplus) (the 'Available Assets'), before any
payment or distribution shall be made on the Common Stock or any other Junior
Security, but after distribution of such assets among, or payment thereof over
to, creditors of the Corporation, (A) with respect to the Series A Preferred, an
amount for each share held by such holder equal to the greater of (i) the sum of
(1) the Series A Stated Value Per Share plus (2) an amount equal to all Series A
Accruing Dividends unpaid thereon (whether or not declared), computed to the
date payment thereof is made available plus (3) any other dividends declared but
unpaid thereon, and (ii) the amount that such holder of the Series A Preferred
would hold had all shares of Preferred Stock been converted to Common Stock
immediately prior to the time of the liquidation, dissolution or winding up of
the Corporation (the greater of (i) and (ii) being sometimes referred to as the
'Series A Liquidation Preference Payment' and such amount with respect to all
shares of Series A Preferred Stock in the aggregate being sometimes referred to
as the 'Series A Liquidation Preference Payments'); and (B) with respect to the
Series B Preferred, an amount for each share held by such holder equal to the
greater of (i) the sum of (1) the Series B Stated Value Per Share plus (2) an
amount equal to all Series B Accruing Dividends unpaid thereon (whether or not
declared), computed to the date payment thereof is made available plus (3) any
other dividends declared but unpaid thereon, and (ii) the amount that such
holder of the Series B Preferred would hold had all shares of Preferred Stock
been converted to Common Stock immediately prior to the time of the liquidation,
dissolution or winding up of the Corporation (the greater of (i) and (ii) being
sometimes referred to as the 'Series B Liquidation Preference

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Payment' and such amount with respect to all shares of Series B Preferred Stock
in the aggregate being sometimes referred to as the 'Series B Liquidation
Preference Payments').

        (b) If upon any voluntary or involuntary liquidation, dissolution or
winding up of the Corporation, the Available Assets shall be insufficient to
permit the payment to holders of the Series A Preferred and Series B Preferred
their full Series A Liquidation Preference Payments and Series B Liquidation
Preference Payments, then all Available Assets shall be distributed among the
holders of the then outstanding Series A Preferred and Series B Preferred pro
rata, on an equal priority, based upon the Series A Stated Value Per Share and
the Series B Stated Value Per Share.

        (c) Upon any liquidation, dissolution or winding up of the Corporation,
immediately after the holders of Preferred Stock have been paid in full the
Series A Liquidation Preference Payments and Series B Liquidation Preference
Payments (as applicable), the remaining net assets of the Corporation available
for distribution shall be distributed among the holders of Junior Securities.

        (d) An Acquisition (as defined below) of the Corporation shall be deemed
to be a liquidation, dissolution or winding up of the Corporation within the
meaning of the provisions of this Paragraph 3. For purposes thereof, the term
'Acquisition' shall mean (i) the consolidation or merger of the Corporation into
or with any other entity or entities which results in the exchange of
outstanding shares of the Corporation for securities or other consideration
issued or paid or caused to be issued or paid by any such entity or affiliate
thereof (except (x) a consolidation or merge into a subsidiary or (y) a merger
in which the Corporation is the surviving corporation and the holders of the
Corporation's voting stock outstanding immediately prior to the transaction
constitute a majority of the holders of voting stock outstanding immediately
following the transaction), (ii) the sale or transfer by the Corporation of all
or substantially all its assets in a transaction or a series of related
transactions, or (V) the sale or transfer by the Corporation's stockholders of
capital stock in a transaction or a series of related transactions representing
a majority of the voting power at elections of directors of the Corporation.
 .
        (e) If any assets of the Corporation distributed to stockholders in
connection with any liquidation, dissolution or winding up of the Corporation
are other than cash, then the value of such assets shall be their fair market
value as determined by the Board in good faith.

        (f) Written notice of such liquidation, dissolution or winding up,
stating a payment date and the place where said payments shall be made, shall be
given not less than 20 days prior to the payment date stated therein, to the
holders of record of Preferred Stock, in accordance with the notice provisions
of Paragraph V.A.9 below.

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        4. Voting Rights.

        (a) Relative to Other Classes. The holders of the Preferred Stock shall
be entitled to notice of all shareholders meetings in accordance with the
Corporation's bylaws, and except as otherwise required by law, the holders of
the Preferred Stock shall be entitled to vote on all matters submitted to the
shareholders of the Corporation for a vote, including the election of directors,
together with the holders of the Common Stock voting together as a single class,
and each share of Preferred Stock (including fractional shares) shall be
entitled to one vote for each whole share of Common Stock that would be issuable
upon conversion of such share on the record date set by the Board for
determining eligibility of holders of Preferred Stock to participate in the
action being taken.

        (b) Relative to Other Series. Notwithstanding any provision of the DGCL
granting the holders of the outstanding shares of a class or series rights to
vote as a separate voting group or any other provision of this Certificate of
Incorporation, the holders of the Preferred Stock shall not have the right to
vote as a separate voting group or series with respect to any matter submitted
to the holders of the Preferred Stock (or any series thereof) and shall vote
together as a class on each such matter; provided, however, that except with
respect to matters approved in accordance with Paragraph V.A.4.(c) and/or
Paragraph V.A.5.(b)(i)(B) below, the Corporation shall not amend, alter or
repeal any provision of the Corporation's Certificate of Incorporation in a
manner that would adversely affect the powers, preferences or special rights of
a particular series of Preferred Stock, without the affirmative vote or consent
of such adversely affected series, voting as a separate series.

        (c) At any time when at least 25% of the shares of Preferred Stock
originally issued by the Corporation are outstanding, except where the vote or
written consent of the holders of a greater number of shares of the Corporation
is required by law or by the Certificate of Incorporation, and without the
approval of the holders of at least a majority of the then outstanding shares of
Preferred Stock, given in writing or by vote at a meeting, consenting or voting
(as the case may be) together as a class (and not as separate series), the
Corporation shall not:

            (i) Sell, abandon, transfer, lease or otherwise dispose of all or
substantially all of its properties or assets;

            (ii) Merge or consolidate with or into, or permit any subsidiary to
merge or consolidate with or into, any other corporation, corporations, entity
or entities; or

            (iii) Liquidate, dissolve or wind up the Corporation.

        5. Conversion Rights.

        (a) Optional Conversion.

            (i) At any time and from time to time, any holder of Preferred Stock
may convert all or any of the shares of Preferred Stock held by such holder into
fully paid and non-assessable shares of Common Stock as provided herein.

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            (ii) Any holder of shares of Preferred Stock desiring to convert any
portion thereof into Common Stock shall surrender each certificate representing
one or more shares of such Preferred Stock to be converted, duly endorsed in
favor of the Corporation or in blank, at the principal business office of the
Corporation (or such other place as may be designated by the Corporation), and
shall give written notice to the Corporation at that office of its election to
convert the same on a signed Election to Convert Preferred Stock into Common
Stock which is set forth on Exhibit A attached hereto setting forth therein the
name or names (with the address or addresses) in which the shares of Common
Stock are to be issued. No conversion under this Paragraph V.A.5.(a) shall be
effective until the shares of Preferred Stock to be converted have been
surrendered to the Corporation in compliance with this Paragraph V.A.5.(a)(ii)
(the date of such surrender being an 'Optional Conversion Date').

        (b) Automatic Conversion.

            (i) Each share of Preferred Stock shall automatically be converted
into fully paid and non-assessable shares of Common Stock, as provided herein,
(A) immediately prior to the closing of a firm commitment underwritten public
offering pursuant to an effective registration statement filed under the
Securities Act of 1933, as amended, covering the offer and sale of Common Stock
for the account of the Corporation at a price per share equal to or greater than
$8.00 and in which the aggregate public offering price (before deduction of
underwriters' discounts and qualifications) equals or exceeds $25,000,000, or
(B) upon the Corporation's receipt of the written consent of the holders of not
less than 75% of the then outstanding shares of the Preferred Stock, voting or
consenting (as the case may be) together as a class, to the conversion of all of
the then outstanding shares of the Preferred Stock under this Paragraph
V.A.5.(b) (each such event an 'Automatic Conversion Event,' the date of each
such event an 'Automatic Conversion Date,' and each Optional Conversion Date and
each Automatic Conversion Date, individually, a 'Conversion Date').

            (ii) Upon the occurrence of any Automatic Conversion Event, the
outstanding shares of Preferred Stock shall be converted into Common Stock
automatically without the need for any further action by the holders of such
shares and whether or not the certificates representing such shares are
surrendered to the Corporation or its transfer agent; provided, however, that
the Corporation shall not be obligated to issue certificates evidencing the
shares of Common Stock issuable upon such conversion unless (A) the certificates
evidencing such shares of Preferred Stock are delivered to the principal
business office of the Corporation (or such other place as may be designated by
the Corporation) as provided below, or (B) the holder notifies the Corporation
(or such other party as may be designated by the Corporation) that such
certificates have been lost, stolen, destroyed or mutilated and the holder
complies with the provisions of Paragraph V.A.8. Upon the occurrence of an
Automatic Conversion Event, the holders of Preferred Stock shall surrender the
certificates representing such shares at the principal business office of the
Corporation (or such other place as may be designated by the Corporation), and
shall thereby become entitled to receive, at such office and in its name as
shown on such surrendered certificate or certificates, a certificate or
certificates for the number of shares of Common Stock into which the shares of
Preferred Stock surrendered were convertible on the date on which the Automatic
Conversion Event occurred.

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        (c) Conversion Price. Each share of the Preferred Stock shall be
convertible in accordance with Paragraph V.A.5.(a) or V.A.5.(b) above into the
number of shares of Common Stock which results from dividing either the Series A
Stated Value Per Share and/or the Series B Stated Value Per Share, as the case
may be, by the Conversion Price for such series of Preferred Stock that is in
effect at the time of conversion. The 'Conversion Price' for each share of
Preferred Stock shall mean, initially, with respect to the Series A Preferred,
the Series A Stated Value Per Share and, with respect to the Series B Preferred,
the Series B Stated Value Per Share for such share. The Conversion Price for
each share of Preferred Stock shall be subject to adjustment from time to time
as provided below. Following each adjustment of the Conversion Price with
respect to a share of the Preferred Stock, such adjusted Conversion Price shall
remain in effect until a further adjustment of such Conversion Price hereunder.

        (d) Action by Corporation in Relation to Conversion.

            (i) As soon as possible after a Conversion Date (but in any event
within fifteen business days in the case of Paragraph V.A.5.(d)(i)(A) below),
the Corporation shall deliver to the converting holder:


               (A) a certificate or certificates representing the number of
               shares of Common Stock issuable by reason of such conversion in
               such name or names and such denomination or denominations as the
               converting holder has specified;

               (B) payment of the amount payable under Paragraph V.A.5.(d)(iv)
               below with respect to such conversion; and

               (C) a certificate representing any shares of Preferred Stock
               which were represented by the certificate or certificates
               delivered to the Corporation in connection with such conversion
               but which (in the case of an optional conversion) were not
               converted.


            (ii) The issuance of certificates for shares of Common Stock upon
conversion of shares of Preferred Stock shall be made without charge to the
holders of such Preferred Stock for any issuance tax in respect thereof or other
cost incurred by the Corporation in connection with such conversion and the
related issuance of shares of Common Stock.

            (iii) The Corporation shall not close its books against the transfer
of Preferred Stock or of Common Stock issued or issuable upon conversion of the
Preferred Stock in any manner which interferes with the timely conversion of
Preferred Stock. The Corporation shall assist and cooperate (but the Corporation
shall not be required to expend substantial efforts or funds) with any holder of
Preferred Stock required to make any governmental filings or obtain any
governmental approval prior to or in connection with any conversion of shares of
Preferred Stock hereunder (including, without limitation, making any filings
required to be made by the Corporation).

            (iv) If any fractional interest in a share of Common Stock would,
except for the provisions of this Paragraph V.A.5.(d)(iv), be deliverable upon
any conversion of shares of a

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holder's Preferred Stock, the Corporation, in lieu of delivering the fractional
share therefor, shall pay an amount to the holder thereof equal to an amount
bearing the same ratio to the fair market value of a whole share of Common
Stock, as determined in good faith by the Board, as the fractional interest to
which the shareholder would otherwise be entitled bears to a whole share of
Common Stock.

            (v) The Corporation shall at all times reserve and keep available
out of its authorized but unissued shares of Common Stock, solely for the
purpose of issuance upon the conversion of the Preferred Stock, not less than
the number of shares of Common Stock issuable upon the conversion of all
outstanding shares of Preferred Stock. All shares of Common Stock which are so
issuable shall, when issued, be duly and validly issued, fully paid and
nonassessable and free from all taxes, liens and charges. The Corporation shall
take all such actions as may be necessary to ensure that all such shares of
Common Stock may be so issued without violation of any applicable law or
governmental regulation or any requirements of any domestic securities exchange
upon which shares of Common Stock may be listed (except for official notice of
issuance which shall be immediately delivered by the Corporation upon each such
issuance).

        (e) Adjustments for Certain Events.

            (i) Adjustment Upon Common Stock Event. Upon the happening of a
Common Stock Event (as hereinafter defined), the Conversion Price for each
series of the Preferred Stock shall, simultaneously with the happening of such
Common Stock Event, be adjusted by multiplying the Conversion Price for such
series in effect immediately prior to such Common Stock Event by a fraction, (A)
the numerator of which shall be the number of shares of Common Stock issued and
outstanding immediately prior to such Common Stock Event, and (B) the
denominator of which shall be the number of shares of Common Stock issued and
outstanding immediately after such Common Stock Event, and the product so
obtained shall thereafter be the Conversion Price for such shares. The
Conversion Price for each share of the Preferred Stock shall be readjusted in
the same manner upon the happening of each subsequent Common Stock Event. As
used herein, the term the 'Common Stock Event' shall mean at any time or from
time to time after the original date of issuance of the Preferred Stock (the
'Issuance Date'), (X) the issuance by the Corporation of additional shares of
Common Stock as a dividend or other distribution on outstanding Common Stock,
(Y) a subdivision of the outstanding shares of Common Stock into a greater
number of shares of Common Stock, or (Z) a combination of the outstanding shares
of Common Stock into a smaller number of shares of Common Stock.

            (ii) Adjustments for Other Dividends and Distributions. If at any
time or from time to time after the Issuance Date the Corporation pays a
dividend or makes another distribution to the holders of the Common Stock
payable in securities of the Corporation, other than an event constituting a
Common Stock Event, then in each such event, provision shall be made so that the
holders of the Preferred Stock shall receive upon the Conversion Date, in
addition to the number of shares of Common Stock receivable upon the Conversion
Date, the amount of securities of the Corporation which they would have received
had their Preferred Stock been converted into Common Stock on the date of such
dividend or distribution (or record date for such dividend or distribution, as
applicable) and had they thereafter, during the period from the date of such
dividend or distribution (or such record date, as applicable) to and

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including the Conversion Date, retained such securities receivable by them as
aforesaid during such period, subject to all other adjustments called for during
such period under this Paragraph V.A.5. with respect to the rights of the
holders of the Preferred Stock or with respect to such other securities by their
terms.

            (iii) Adjustment for Recapitalization, Reclassification, Exchange
and Substitution. If at any time or from time to time after the Issuance Date
the Common Stock issuable upon the conversion of the Preferred Stock is changed
into the same or a different number of shares of any class or classes of stock,
whether by recapitalization, reclassification or otherwise (other than by a
Common Stock Event or a stock dividend, reorganization, merger, consolidation or
sale of assets provided for elsewhere in this Paragraph V.A.5.), then in any
such event each holder of the Preferred Stock shall have the right thereafter to
convert such stock into the kind and amount of stock and other securities and
property receivable upon such recapitalization, reclassification or other change
by holders of the number of shares of Common Stock into which such shares of the
Preferred Stock could have been converted immediately prior to such
recapitalization, reclassification or change, all subject to further adjustment
as provided herein or with respect to such other securities or property by the
terms thereof.

            (iv) Adjustment for Reorganizations, Mergers and Consolidations. If
at any time or from time to time after the Issuance Date there is a
reorganization of the Corporation (other than a recapitalization, subdivision,
dividend, combination, reclassification or exchange of shares provided for
elsewhere in this Paragraph V.A.5.(e)), a merger or consolidation of the
Corporation with or into another entity, or a sale of all or substantially all
of the assets of the Corporation, then, as a part of such reorganization,
merger, consolidation or sale of all or substantially all of the assets,
provision shall be made so that the holders of the Preferred Stock thereafter
shall be entitled to convert the Preferred Stock into the amount and kind of
shares of stock or other securities or property of the Corporation, or of such
successor corporation resulting from such reorganization, merger, consolidation
or sale of assets, receivable by a holder of the number of shares of Common
Stock into which such shares of the Preferred Stock could have been converted
immediately prior to such reorganization, merger, consolidation or sale of
assets. In any such case, appropriate adjustment shall be made in the
application of the provisions of this Paragraph V.A.5.(e) with respect to the
rights of the holders of the Preferred Stock after the reorganization, merger,
consolidation or sale of assets to the end that the provisions of this Paragraph
V.A.5.(e) (including adjustment of the Conversion Price then in effect and
number of shares issuable upon conversion of the Preferred Stock) shall be
applicable after that event and be as nearly equivalent to the provisions hereof
as may be practicable. This Paragraph V.A.5.(e)(iv) shall similarly apply to
successive reorganizations, mergers, consolidations and sales of assets.

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        (f) Sale of Shares of Common Stock Below Preferred Stock Conversion
Price.

            (i) Preferred Stock Conversion Price Adjustment Formula. If at any
time or from time to time after the Issuance Date the Corporation issues or
sells, or is deemed by the provisions of this Paragraph V.A.5.(f) to have issued
or sold, Additional Shares of Common Stock (as hereinafter defined), otherwise
than in connection with a Common Stock Event as provided in Paragraph
V.A.5.(e)(i), a dividend or distribution as provided in Paragraph V.A.5.(e)(ii),
a recapitalization, reclassification or other change as provided in Paragraph
V.A.5.(e)(V) or a reorganization, merger, consolidation or sale of assets as
provided in Paragraph V.A.5.(e)(iv), for an Effective Price (as hereinafter
defined) that is less than the Conversion Price for a share of the Series A
Preferred and/or the Series B Preferred in effect immediately prior to such
issue or sale (or deemed issue or sale), then, and in each such case, the
Conversion Price for the applicable shares of Series A Preferred and/or the
Series B Preferred shall be reduced, as of the close of business on the date of
such issue or sale, to the Adjusted Price (which shall be the new Conversion
Price after any such adjustment).

            (ii) Certain Definitions. For the purpose of making any adjustment
required under this Paragraph V.A.5.(f):

                (A)  The 'Additional Shares of Common Stock' shall mean all
                     shares of Common Stock issued by the Corporation, whether
                     or not subsequently reacquired or retired by the
                     Corporation, other than:

                     (1) shares of Common Stock issued or issuable upon
                         conversion of the outstanding shares of the Series A
                         Preferred and Series B Preferred;

                     (2) up to 6,700,000 shares of Common Stock (or options,
                         warrants or rights therefor) granted or issued
                         hereafter to employees, officers, directors,
                         contractors, consultants or advisers to the Corporation
                         or any majority-owned subsidiary of the Corporation
                         pursuant to incentive agreements, stock purchase or
                         stock option plans, stock bonuses or awards, warrants,
                         contracts or other arrangements that are approved by
                         the Board;

                     (3) shares of such Common Stock issued upon exercise or
                         conversion of any option, warrant or other convertible
                         security outstanding as of the Issuance Date;

                     (4) shares of Common Stock issued pursuant to an Automatic
                         Conversion Event; and

                     (5) in connection with (i) any borrowings, direct or
                         indirect, from financial institutions or other persons
                         by the Corporation, whether or not presently
                         authorized, including

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                         any type of loan or payment evidenced by any type of
                         debt instrument, if such borrowing, loan or debt
                         instrument is approved by the Board, (ii) any
                         transaction with vendors or customers or to other
                         persons in similar commercial situations with the
                         Corporation if such issuance is approved by the Board,
                         or (iii) obtaining lease financing, whether issued to a
                         lessor, guarantor or other person if such issuance is
                         approved by the Board; provided that the aggregate
                         number of shares of Common Stock deemed issued pursuant
                         to (i), (ii) and (iii) above does not exceed five
                         percent (5%) of the aggregate number of shares of
                         Common Stock then outstanding plus the aggregate number
                         of shares of Common Stock issuable upon the exercise,
                         conversion or exchange of any Common Stock Equivalents
                         Outstanding.

                (B)  The 'Aggregate Consideration Received' by the Corporation
                     for any issue or sale (or deemed issue or sale) of
                     securities shall (1) to the extent it consists of cash, be
                     computed at the gross amount of cash received by the
                     Corporation before deduction of any reasonable underwriting
                     or similar commissions, compensation or concessions paid or
                     allowed by the Corporation in connection with such issue or
                     sale and without deduction of any reasonable expenses
                     payable by the Corporation; (2) to the extent it consists
                     of property other than cash, be computed at the fair value
                     of that property as determined in good faith by the Board;
                     and (3) if Additional Shares of Common Stock, Convertible
                     Securities or Rights or Options to purchase either
                     Additional Shares of Common Stock or Convertible Securities
                     are issued or sold together with other stock or securities
                     or other assets of the Corporation for a consideration
                     which covers both, be computed as the portion of the
                     consideration so received that may be reasonably determined
                     in good faith by the Board to be allocable to such
                     Additional Shares of Common Stock, Convertible Securities
                     or Rights or Options.

                (C)  The 'Common Stock Equivalents Outstanding' shall mean the
                     number of shares of Common Stock that is equal to the sum
                     of (1) all shares of Common Stock of the Corporation that
                     are outstanding at the time in question, plus (2) all
                     shares of Common Stock of the Corporation issuable upon
                     conversion of all shares of Preferred Stock or other
                     Convertible Securities that are outstanding at the time in
                     question, plus (3) all shares of Common Stock of the
                     Corporation that are issuable upon the exercise of Rights
                     or Options that are outstanding at the time in question
                     assuming the full conversion or exchange into shares of the
                     Common Stock of

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                     all such Rights or Options that are Rights or Options to
                     purchase or acquire Convertible Securities.

                (D)  The 'Convertible Securities' shall mean stock or other
                     securities convertible into or exchangeable for shares of
                     the Common Stock.

                (E)  The 'Effective Price' of Additional Shares of Common Stock
                     shall mean the quotient determined by dividing the total
                     number of Additional Shares of Common Stock issued or sold,
                     or deemed to have been issued or sold, by the Corporation
                     under this Paragraph V.A.5.(f), into the Aggregate
                     Consideration Received, or deemed to have been received, by
                     the Corporation under this Paragraph V.A.5.(f), for the
                     issue of such Additional Shares of Common Stock;

                (F)  The 'Rights or Options' shall mean warrants, options or
                     other rights to purchase or acquire shares of the Common
                     Stock or Convertible Securities.

                (G)  The 'Adjusted Price' shall be equal to a price determined
                     by multiplying the applicable Conversion Price then in
                     effect by a fraction, the numerator of which shall be the
                     number of shares of Common Stock outstanding immediately
                     prior to the issuance of Additional Shares of Common Stock
                     plus the number of shares of Common Stock that the
                     Aggregate Consideration Received by the Corporation for
                     such issuance would purchase at such applicable Conversion
                     Price (prior to adjustment), and the denominator of which
                     shall be the number of shares of Common Stock outstanding
                     immediately prior to such issuance plus the number of
                     shares of such Additional Shares of Common Stock.

            (iii) Deemed Issuances. For the purpose of making any adjustment to
the Conversion Price of any share of Preferred Stock required under this
Paragraph V.A.5.(f), if the Corporation issues or sells any Rights or Options or
Convertible Securities and if the Effective Price of the shares of Common Stock
issuable upon exercise of such Rights or Options and/or the conversion or
exchange of Convertible Securities (computed without reference to any additional
or similar protective or antidilution clauses) is less than the Conversion Price
then in effect for such series of Preferred Stock, then the Corporation shall be
deemed to have issued, at the time of the issuance of such Rights or Options or
Convertible Securities, that number of Additional Shares of Common Stock that is
equal to the maximum number of shares of Common Stock issuable upon exercise or
conversion of such Rights or Options or Convertible Securities upon their
issuance and to have received, as the Aggregate Consideration Received for the
issuance of such shares, an amount equal to the total amount of the
consideration, if any, received by the Corporation for the issuance of such
Rights or Options or Convertible Securities, plus, in the case of such Rights or
Options, the minimum amounts of consideration, if any, payable to the
Corporation upon the exercise in full of such Rights or Options, plus, in the
case of Convertible

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Securities, the minimum amounts of consideration, if any, payable to the
Corporation (other than by cancellation of liabilities or obligations evidenced
by such Convertible Securities) upon the conversion or exchange thereof;
provided that:

                (A)  if the minimum amounts of such consideration cannot be
                     ascertained, but are a function of antidilution or similar
                     protective clauses, then the Corporation shall be deemed to
                     have received the minimum amounts of consideration without
                     reference to such clauses;

                (B)  if the minimum amount of consideration payable to the
                     Corporation upon the exercise of Rights or Options or the
                     conversion or exchange of Convertible Securities is reduced
                     over time or upon the occurrence or non-occurrence of
                     specified events other than by reason of antidilution or
                     similar protective adjustments, then the Effective Price
                     shall be recalculated using the figure to which such
                     minimum amount of consideration is reduced; and

                (C)  if the minimum amount of consideration payable to the
                     Corporation upon the exercise of such Rights or Options or
                     the conversion or exchange of Convertible Securities is
                     subsequently increased, then the Effective Price shall
                     again be recalculated using the increased minimum amount of
                     consideration payable to the Corporation upon the exercise
                     of such Rights or Options or the conversion or exchange of
                     such Convertible Securities.

No further adjustment of the Conversion Price for a share of the Preferred
Stock, adjusted upon the issuance of such Rights or Options or Convertible
Securities, shall be made as a result of the actual issuance of shares of Common
Stock on the exercise of any such Rights or Options or the conversion or
exchange of any such Convertible Securities. If any such Rights or Options or
the conversion rights represented by any such Convertible Securities shall
expire without having been fully exercised, then the Conversion Price for a
share of the Preferred Stock as adjusted upon the issuance of such Rights or
Options or Convertible Securities shall be readjusted to the Conversion Price
for such series which would have been in effect had an adjustment been made on
the basis that the only shares of Common Stock deemed to have been issued were
the shares of Common Stock, if any, that were actually issued or sold on the
exercise of such Rights or Options or rights of conversion or exchange of such
Convertible Securities, and such shares of Common Stock deemed to have been
issued, if any, were issued or sold for the consideration actually received by
the Corporation upon such exercise, plus the consideration, if any, actually
received by the Corporation for the granting of all such Rights or Options,
whether or not exercised, plus the consideration received for issuing or selling
all such Convertible Securities actually converted or exchanged, plus the
consideration, if any, actually received by the Corporation (other than by
cancellation of liabilities or obligations evidenced by such Convertible
Securities) on the conversion or exchange of such Convertible Securities,
provided

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that such readjustment shall not apply to conversions of Preferred Stock made
prior such readjustment.

        6. Rights to Distributions. If at any time the Corporation shall declare
a distribution payable in securities of any other person, evidence of
indebtedness issued by the Corporation or any other person, assets (excluding
cash dividends) or options or rights to purchase any such securities or
evidences of indebtedness, pro-rata to all of the record holders of any class of
Junior Securities, then, in each such case the holder of the Preferred Stock
shall be entitled to a proportionate share of any such distribution as though
the holders of the Preferred Stock were the holders of the number of Common
Stock of the Corporation in which their respective shares of Preferred Stock are
convertible as of the date of the record date fixed for the determination of the
holders of the Common Stock of the Corporation entitled to receive such
distribution.

        7. Transfer. The Corporation shall keep at its principal office a
register for the registration of issuances and transfers of Preferred Stock.
Upon the surrender of any certificate representing Preferred Stock at such
place, the Corporation shall, at the request of the record holder of such
certificate, execute and deliver (at the Corporation's expense) a new
certificate or certificates in exchange therefor representing in the aggregate
the number of shares of Preferred Stock represented by the surrendered
certificate. Each such new certificate shall be registered in such name and
shall represent such number of shares of Preferred Stock as is requested by the
holder of the surrendered certificate and shall be substantially identical in
form to the surrendered certificate, and dividends shall accrue on the Preferred
Stock represented by such new certificate from the date to which dividends have
been fully paid on such Preferred Stock represented by the surrendered
certificate.

        8. Replacement. Upon receipt of evidence reasonably satisfactory to the
Corporation (an appropriate affidavit of the registered holder shall be
satisfactory) of the ownership and the loss, theft, destruction or mutilation of
any certificate evidencing shares of Preferred Stock, and in the case of any
such loss, theft or destruction, upon receipt of indemnity reasonably
satisfactory to the Corporation (provided that if the holder is a financial
institution or other institutional investor, its own agreement shall be
satisfactory), or, in the case of any such mutilation upon surrender of such
certificate, the Corporation shall (at its expense) execute and deliver in lieu
of such certificate a new certificate of like kind representing the number of
shares of Preferred Stock represented by such lost, stolen, destroyed or
mutilated certificate and dated the date of such lost, stolen, destroyed or
mutilated certificate, and dividends shall accrue on the Preferred Stock
represented by such new certificate from the date to which dividends have been
fully paid on the shares of Preferred Stock represented by such lost, stolen,
destroyed or mutilated certificate.

        9. Notices.

            (a) Immediately upon any adjustment of the applicable Conversion
Price, the Corporation shall give written notice thereof to all holders of the
applicable series of Preferred Stock, setting forth in reasonable detail and
certifying the calculation of such adjustment.

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            (b) The Corporation shall give written notice to all holders of
Preferred Stock at least 10 days prior to the date on which the Corporation
closes its books or fixes a record date (i) with respect to any dividend or
distribution upon Common Stock, (ii) with respect to any pro rata subscription
offer to holders of Common Stock or (iii) for determining rights to vote with
respect to any liquidation.

            (c) Except as otherwise expressly provided hereunder, all notices
referred to in this Article V shall be in writing and shall be delivered by
registered or certified mail, return receipt requested and postage prepaid, or
by reputable overnight courier service, charges prepaid, and shall be deemed to
have been given the third day following the date when so mailed or the date
designated for delivery when so sent by courier (i) to the Corporation, at its
principal executive offices and (ii) to any stockholder, at such holder's
address as it appears in the stock records of the Corporation (unless otherwise
indicated by any such holder).

        10. No Impairment. The Corporation shall not avoid or seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Corporation, but shall at all times in good faith assist in
carrying out all such action as may be reasonably necessary or appropriate in
order to protect the conversion rights of the holders of the Preferred against
impairment.

B. COMMON STOCK

        1. Dividends. Subject to the rights of the holders of the Preferred
Stock, and subject to any other provisions of this Certificate of Incorporation,
holders of shares of the Common Stock shall be entitled to receive such
dividends and other distributions in cash, stock or property of the Corporation
as may be declared thereon by the Board from time to time out of assets or funds
of the Corporation legally available therefor.

        2. Liquidation; Dissolution. In the event of any liquidation,
dissolution or winding up of the affairs of the Corporation, whether voluntary
or involuntary, after payment or provision for payment of the debts and other
liabilities of the Corporation and after payment or provision for payment to the
holders of each series of the Preferred Stock of all amounts required in
accordance with Paragraph V.A, the remaining assets and funds of the Corporation
shall be divided among and paid to the holders of the Common Stock.

        3. Voting.

        (a) At every meeting of the shareholders every holder of shares of the
Common Stock shall be entitled to one vote in person or by proxy for each share
of such Common Stock standing in his name on the stock transfer records of the
Corporation.

        (b) No shareholder shall have the right to cumulate votes in the
election of directors.

        4. Preemptive Rights. No holder of shares of the Common Stock of the
Corporation shall, as such holder, be entitled as of right to subscribe for,
purchase or receive any part of any new or additional issue of stock of any
class, whether now or hereafter authorized, or of bonds, debentures or other
securities convertible into or exchangeable for stock, but all such additional

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shares of stock of any class, or bonds, debentures or other securities
convertible into or exchangeable for stock, may be issued and disposed of by the
Board on such terms and for such consideration, so far as may be permitted by
law, and to such persons, as the Board in its absolute discretion may deem
advisable.

                                   ARTICLE VI

            A director of the Corporation shall, to the fullest extent permitted
by the DGCL as it now exists or as it may hereafter be amended, not be
personally liable to the Corporation or its stockholders for monetary damages
for breach of fiduciary duty as a director, except for liability (i) for any
breach of the director's duty of loyalty to the Corporation or its stockholders,
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL,
or (iv) for any transaction from which the director derived any improper
personal benefit. If the DGCL is amended, after approval by the stockholders of
this Article V, to authorize corporate action further eliminating or limiting
the personal liability of directors, then the liability of a director of the
Corporation shall be eliminated or limited to the fullest extent permitted by
the DGCL, as so amended.

            Any amendment, repeal or modification of this Article V, or the
adoption of any provision of this Certificate of Incorporation inconsistent with
this Article V by the stockholders of the Corporation shall not apply to or
adversely affect any right or protection of a director of the Corporation
existing at the time of such amendment, repeal, modification or adoption.

                                   ARTICLE VII

            To the fullest extent permitted by applicable law, the Corporation
is authorized to provide indemnification of (and advancement of expenses to)
agents of the Corporation (and any other persons to which State law permits the
Corporation to provide indemnification) through Bylaw provisions, agreements
with such agents or other persons, vote of stockholders or disinterested
directors or otherwise, in excess of the indemnification and advancement
otherwise permitted by Section 145 of the DGCL, subject only to limits created
by applicable State law (statutory or non-statutory), with respect to actions
for breach of duty to the Corporation, its stockholders, and others.

            Any amendment, repeal or modification of the foregoing provision of
this Article VII shall not adversely affect any right or protection of a
director, officer, agent, or other person existing at the time of, or increase
the liability of any director of this Corporation with respect to any acts or
omissions of such director, officer or agent occurring prior to, such amendment,
repeal, modification or adoption.

                                  ARTICLE VIII

            The Corporation reserves the right to adopt, amend, alter,
supplement, rescind or repeal in any respect any provision contained in this
Certificate of Incorporation, in the manner now or hereafter prescribed by
statute or applicable law, and all rights conferred upon stockholders herein are
granted subject to this reservation.

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                                   ARTICLE IX

            Subject to the provisions of Article V hereof, the Board of
Directors may from time to time adopt, amend, alter, supplement, rescind or
repeal any or all of the Bylaws of the Corporation without any action on the
part of the stockholders; provided, however, that the stockholders may adopt,
amend or repeal any Bylaw adopted by the Board of Directors, and no amendment or
supplement to the Bylaws adopted by the Board of Directors shall vary or
conflict with any amendment or supplement adopted by the stockholders.

                                    ARTICLE X

            Subject to the provisions of Article V, the number of directors of
the Corporation shall be set from time to time by resolution of the Board of
Directors.

                                   ARTICLE XI

            Elections of directors need not be by written ballot unless the
Bylaws of the Corporation shall so provide.

                                   ARTICLE XII

            Meetings of stockholders may be held within or without the State of
Delaware, as the Bylaws may provide. The books of the Corporation may be kept
(subject to any statutory requirements) outside the State of Delaware at such
place or places as may be designated from time to time by the Board of Directors
or in the Bylaws of the Corporation.


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        IN WITNESS WHEREOF, this Certificate of Incorporation has been executed
by Caldera Systems, Inc. as of this 3rd day of March, 2000.


                                   CALDERA SYSTEMS, INC.
                                   (A UTAH CORPORATION)

                                   By: /s/ RANSOM H. LOVE
                                       -----------------------------------------
                                          Ransom H. Love, President and Chief
                                          Executive Officer


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