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 5, 2000
MITEL CORPORATION
----------------------------------------------------
(Exact name of registrant as specified in its charter)
CANADA 1-8139 NONE
------------------------------ ------------------- -----------------
(State or other jurisdiction of (Commission File No.) (I.R.S. Employer
incorporation or organization) Identification No.)
350 Legget Drive
P.O. Box 13089
Kanata, Ontario, Canada K2K 2W7
----------------------- -----------
(Address of principal (Postal Code)
executive offices)
Registrant's telephone number, including area code: (613) 592-2122
-------------
N/A
-----------------------------------------------------------
(Former name or former address, if changed since last report)
<PAGE>
Item 5. Other Events
--------------------
5(a) Mitel Corporation has entered into an agreement to
acquire privately held Vertex Networks, Incorporated
On June 6, 2000, Mitel Corporation ("Mitel" or "the Company"),
announced that it had entered into an agreement to acquire 100
percent of the common stock of privately-held Vertex Networks,
Incorporated ("Vertex"), for total consideration of 11 million
common shares to be newly issued by Mitel (the "Acquisition
Shares"). The transaction will be effected through a merger of
a newly formed U.S. subsidiary of Mitel into Vertex.
The acquisition will be accounted for by the purchase method
with Vertex's results from operations included in the
consolidated accounts of the Company from the date of
acquisition, expected to be on or before August 30, 2000. In
accordance with such method, there may be adjustments to the
actual cost of the purchase with respect to incremental costs
directly associated with the acquisition. The fair value of
the consideration will be determined by the average trading
price of the Company's common shares, as adjusted where
appropriate, five business days before and five business days
after the effective date of acquisition.
The Company will seek to qualify for an exemption from
registration of the Acquisition Shares pursuant to Section
3(a)(10) of the Securities Act of 1933, as amended (the
"Act"), by obtaining a permit under Section 25121 of the
California Corporate Securities Law of 1968. Alternatively,
the issuance of the Acquisition Shares may be exempt from
registration pursuant to Section 4(2) of the Act and the rules
and regulations thereunder. If no such exemption is available,
the Company will file an appropriate registration statement
under the Act covering the Acquisition Shares.
Vertex is a fabless semiconductor company providing
high-performance network packet processing, switching and
routing silicon solutions for the enterprise and WAN access
markets. Vertex provides integrated circuits for Layer 3 IP
routing switches and developing chipsets, reference designs,
and software for intelligent packet switching applications.
Vertex's products encompass Quality of Service ("QoS")-enabled
IP switching for enterprise communications, wide area network
("WAN") traffic concentration, and fiber to the home ("FTTH")
markets. Vertex, which was founded in 1995, is based in
Irvine, California, United States, and has design centers in
San Jose, California, and Taiwan. The Company intends to
continue operating these design centers for the same purposes
as prior to the acquisition. Vertex employed approximately 75
people at May 31, 2000.
5(b) Mitel Corporation Continues Common Share Repurchase
Program
On June 5, 2000, Mitel announced that its Board of Directors
had authorized the continuation of its normal course issuer
bid program to repurchase up to 5,706,196 common shares,
representing five percent of the 114,123,921 issued and
outstanding common stock of the Company. These purchases are
expected to take place on the open market through the stock
exchanges of New York and Toronto over a twelve-month period
beginning on June 9, 2000 and ending on June 8, 2001, or on
such earlier date as the Company may complete its purchases
pursuant to the notice of intention to make a normal course
issuer bid filed with The Toronto Stock Exchange.
During the period from June 9, 1999 to June 5, 2000, Mitel
repurchased and cancelled 3,383,800 common shares at an
average purchase price of $10.07 per common share under its
normal course issuer bid program that expired on June 8, 2000.
2
<PAGE>
Mitel, which intends to cancel the repurchased shares,
believes that at present no director, senior officer or
insider of the Company intends to sell any common shares under
this program.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
--------------------------------------------------------------------------
(c) Exhibits.
(1)Exhibit 2.1 Agreement and Plan of Reorganization
and Merger by and among Mitel Corporation, U.S.
Acquisition Corporation and Vertex Networks,
Incorporated ("Vertex"), dated as of June 6, 2000 (the
"Merger Agreement"). Except for the Escrow Agreement and
Restricted Stock Agreement listed below as Exhibits 2.2
and 2.3, respectively, the following exhibits to the
Merger Agreement have been omitted. The Company will
furnish supplementally a copy of any omitted exhibit to
the Commission upon request.
Omitted exhibits:
Exhibit A Form of Merger Agreement
Exhibit C 2000 Financial Statements
Exhibit D Form of Written Consent and Agreement
Exhibit E Form of Purchaser/Acquisition Corp. Tax
Representation Letter
Exhibit F-1 Form of Employment Agreement (Founders)
Exhibit F-2 Form of Employment Agreement (Non Founders)
Exhibit G-1 Form of Noncompetition Agreement (Founders)
Exhibit G-2 Form of Noncompetition Agreement (Non Founders)
Exhibit H-1 Form of Lock Up Agreement
Exhibit H-2 Form of Lock Up Agreement (Designated Employees)
Exhibit I Form of Voting Agreement
Exhibit J Form of Affiliate Agreement
Exhibit L Form of Opinion of Counsel to the Company
Exhibit M Form of Shareholder Letter
Exhibit N Form of FIRPTA Notification Letter
Exhibit O Form of Opinion of Counsel to Purchaser
(2)Exhibit 2.2 Form of Escrow Agreement to be
executed and delivered by the Company, the Shareholder
Representatives (as defined in the Merger Agreement) and
the Escrow Agent named therein.
3
<PAGE>
(3)Exhibit 2.3 Form of Restricted Stock Agreement to
be executed and delivered by the Company and certain
holders of capital stock of Vertex.
(4)Exhibit 99.1 Press Release, dated June 6, 2000
relating to transaction with Vertex.
(5)Exhibit 99.2 Press Release, dated June 5, 2000
relating to continuation of Common Share repurchase
program.
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MITEL CORPORATION
-----------------
(Registrant)
Date June 21, 2000 Jean-Jacques Carrier
--------------------
Jean-Jacques Carrier
Senior Vice President, Finance
and Chief Financial Officer
5
