Vector Capital Acquires Corel

On August 28, 2003, San Francisco-based Vector Capital group acquired Ottawa-based Corel Corporation by way of a court-approved plan of arrangement. Under the arrangement, Vector Capital group paid US$98.4 million to public Corel securityholders, in addition to US$12.9 million previously paid in March to purchase a significant stake of Corel from a subsidiary of Microsoft Corporation. In connection with the transaction, Corel held a securityholder meeting on August 20, to approve the arrangement and related matters. A group of dissident shareholders opposed the acquisition and voiced that opposition through a Web site, in the press and by attending the securityholders’ meeting and at the hearing related to the final court order approving the arrangement. Each resolution required in connection with the completion of the acquisition was approved by the Corel securityholders and the arrangement was approved by court on August 22. Under the arrangement Vector Capital group acquired all Corel shares.

Vector Capital was represented by Torys LLP in Toronto, with a team that included Darren Sukonick, Peter Jewett, Gavin Sinclair and Karen Shields (corporate and securities), and assisted by Corrado Cardarelli and Tim Rorabeck (tax), Linda Plumpton (litigation), Chris Medland (employment), Robin Coster (intellectual property), and Andy Beck, Steve Reinhardt and Margaret Walrath in New York handled U.S. aspects.

Corel was represented in Canada by McCarthy Tétrault LLP in Ottawa, with a team that included Robert Chapman, Virginia Schweitzer and Phil Shaer (corporate and securities), Tom Conway (litigation) and Jim Morand (tax); and in the U.S. by Milbank, Tweed, Hadley & McCloy LLP in New York, with a team that included Mark Weissler, Dale Ponikvar, Charles Westland and Alan Scwartz. The Corel board of directors was represented by Christopher Portner of Osler, Hoskin & Harcourt LLP.

In connection with the acquisition, Vector Capital arranged bank financing with Wells Fargo Foothill. For the financing, Vector Capital was represented by Torys with a team that included Peter Birkness, Adam Delean and Jamie Koumanakos, and assisted by Marni Halter. Fargo Foothill was represented in Canada by Blake, Cassels & Graydon LLP, with a team that included Daryl Clark, Peter Kalbfleisch, Ian Binnie, Neal Wang and Nicole Handford; and in the U.S. by Mayer, Brown, Rowe & Maw LLP, with a team that included Marshall Stoddard, Sandra Lee Montgomery, Christopher Exberger, Robert Goldschein and Danielle Garcia, and assisted by Kimberley Lathrop.