-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
MI/QtUWX6HVt+8wrQ7vfIJ9lxI45PORp1iNlqxkEE/YG3Jqty72O9p4GXtcRzq0O
OuMiQMcFgJr9BOP06o+4Dg==
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549 FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported):
June 6, 2003
COREL CORPORATION
(Exact name of registrant as specified in its charter)
|
|
|
|
1600 Carling Avenue
Ottawa, Ontario, Canada KIZ 8R7
(Address of principal executive offices including zip code)
(613) 728-8200
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Item 5. Other Events and Required FD Disclosure
Corel Corporation ("Corel") entered into an acquisition agreement with Corel Holdings, L.P. ("AcquisitionCo") and Vector CC Acquisitions Inc. ("BuyerCo") (Acquisition Co. and Buyer Co, together, "Vector") dated as of June 6, 2003 (the "Acquisition Agreement") under which Vector has agreed to acquire all of the outstanding common shares of Corel ("Common Shares") pursuant to a plan of arrangement (the "Arrangement") at a price of US$1.05 per share, payable in cash. See press release dated June 6, 2003 attached as Exhibit 99 hereto.
Pursuant to the Arrangement, each Common Share issued and outstanding at the effective time of the Arrangement (other than the Common Shares held by Vector and its affiliates) will be converted into (1) one new Series B Preferred Share of Corel (a "Series B Share") and (2) one new common share of Corel (a "New Common Share"). Upon the closing of the transaction, (i) each Series B Share will be transferred to BuyerCo and (ii) each New Common Share will be transferred to AcquisitionCo, in exchange for total cash consideration of US$1.05.
An affiliate of Vector, Vector CC Holdings, L.L.C. ("Vector CC Holdings") holds 22,890,000 Series A preferred convertible shares of Corel ("Series A Shares") being all of the outstanding Series A Shares of Corel and representing approximately 19.75% of the issued and outstanding Common Shares, assuming conversion of the Series A Shares.
The Acquisition Agreement contains (1) mutual representations and warranties, (2) covenants with respect to the operation of Corel prior to consummation of the acquisition, including covenants with respect to the taking of certain actions to reduce operating expenses, and (3) conditions to the parties' obligations to consummate the transaction, including the holding of a special meeting of the securityholders of Corel to consider and approve the Arrangement and to approve the termination of Corel's shareholder rights plan, the receipt of Court and all required regulatory approvals, conditions with respect to the maintenance by Corel of specified levels of cash and working capital, and a condition that there will be no material adverse change in the financial condition, results of operations or prospects of Corel between the date of the Acquisition Agreement and the date of completion.
The Arrangement is subject to the approval by the holders, present in person or by proxy at the meeting, of two-thirds of the Common Shares and options and warrants exercisable for Common Shares at a per Common Share price of less than US$1.05 per share, and, separately, by a majority of the holders of such securities, present in person or by proxy at the meeting, excluding any Common Shares which may be acquired by Vector on the conversion of any of its Series A Shares. Vector Holdings has agreed to vote its Series A Shares in favour of the Arrangement. Corel has agreed to make an application to Canadian securities regulators for relief from the requirements for a formal valuation of Corel. Upon the completion of the transaction, Vector and its affiliates will own all of the outstanding shares of Corel. See Acquisition Agreement attached as Exhibit 2. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits (c) Exhibits. 2 Acquisition Agreement dated June 6, 2003 between Corel Corporation, Vector CC Acquisitions Inc. and Corel Holdings, L.P. 99 Press release dated June 6, 2003.
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. COREL CORPORATION By_________________________ Name: Joel Price Title: Vice-President Finance and Interim Chief Financial Officer Corel and Vector Capital Sign Acquisition Agreement
Ottawa, Canada and San Francisco, CA June 6, 2003 Corel Corporation (NASDAQ: CORL, TSX: COR) and Vector Capital Corporation today announced that Corel Corporation ("Corel") and an affiliate of Vector Capital Corporation ("Vector") have entered into a definitive Acquisition Agreement (the "Agreement") providing for the acquisition by Vector of all of the outstanding common shares of Corel pursuant to a court-approved Plan of Arrangement (the "Arrangement"). If the Arrangement is approved by the court and the shareholders, Corel's shareholders will receive, subject to the conditions of closing, US$1.05 in cash for each common share held which will include all common shares which may become outstanding on the exercise of options, warrants and other securities exercisable for, convertible into or exchangeable for common shares. Upon the completion of the Arrangement, Vector and its affiliates will own all of the outstanding shares of Corel. Corel's Board of Directors has agreed, subject to certain conditions, to recommend that shareholders approve the Arrangement and to facilitate the Arrangement by undertaking a pre-closing reorganization of certain assets, convening a meeting of the shareholders to consider and approve the Arrangement and by diligently pursuing the application for the required court approval. The agreement by Corel's Board of Directors is subject to the Board's fiduciary right to consider and support a superior proposal, in which event Vector will be entitled to elect to make a further proposal on terms which are as favourable as, or superior to, the terms of the superior proposal from a financial perspective. In the event that an agreement to implement the superior proposal is concluded, Corel would be required to pay Vector a termination fee of US$2.0 million as well as a portion of Vector's expenses relating to the Arrangement. Complete details of the Arrangement will be provided as part of the information circular that Corel will distribute to registered shareholders in July 2003. "The Arrangement represents an opportunity for the shareholders of Corel to realize the value of their shareholdings. The price per share represents a premium of 42% to the market immediately prior to our announcement that Vector had entered into a non-disclosure and standstill agreement with Corel," said James Baillie, Chairman of Corel's Board of Directors. "With the assistance of Corel's financial advisor, CIBC World Markets Inc., we have assessed all of the strategic alternatives available to Corel to maximize value for its shareholders. We have also received the opinion of CIBC World Markets that the cash consideration to be received by the shareholders under the Arrangement is fair from a financial point of view. In light of these facts, the Board concluded that the proposal put forward is in the best interests of the company and its shareholders and has therefore confirmed the transaction subject to shareholder approval and the absence of a superior transaction proposal," said Mr. Baillie. "We are extremely pleased to have reached a mutually-acceptable proposal with Corel," said Alex Slusky, Vector Capital's Managing Partner. "We believe strongly that Corel's best opportunity moving forward is as a private company. This all-cash transaction offers Corel's shareholders an attractive premium and relieves them of market and operating risk going forward. Without the costs and distractions of the public market, Corel's dedicated employees can focus on what they do best - delivering the highest quality software products to a diverse global customer base." Corel expects to apply to the court for procedural instructions within the next two to three weeks with a view to holding a shareholders meeting to consider the Arrangement and, if approved by the shareholders and the court, completing the Arrangement by approximately the end of July 2003. |