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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13D-1(A)AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13D-2(A)
Under the Securities and Exchange Act of 1934
INPRISE CORPORATION
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(Name of Issuer)
Common Stock
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(Title of Class of Securities)
45766C102
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(CUSIP Number)
[MICHAEL C.J. COWPLAND
CHIEF EXECUTIVE OFFICER]
COREL CORPORATION
1600 CARLING AVENUE
OTTAWA, ONTARIO, CANADA K1Z 8R7
(613) 728-8200
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
February 7, 2000
(Date of Event Which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f), or 13d-1(g), check the
following box [ ].
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
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SCHEDULE 13D
1) Name of Reporting Person.
(S.S. or I.R.S. Identification No. of Above Persons (Entities only))
Corel Corporation (Tax ID # Not applicable)
2) Check the Appropriate box if a Member of a Group (See Instructions)
(a) [ ]
(b) [ ]
3) SEC Use Only ____________________________________________________
4) Source of Funds
WC
5) Check box if disclosure of legal proceedings pursuant to items 2(d) or
2(e) - [ ].
6) Citizen or Place of Organization -
Canada
7) Sole Voting Power - 12,000,000
8) Shared Voting Power
9) Sole Dispositive Power - 12,000,000
10) Shared Dispositive Power
11) Aggregate Amount Beneficially Owned by Each Reporting Person -
12,000,000
12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions)
13) Percent of Class Represented by Amount in Row (11) - 19.7%
14) Type of Reporting Person (See Instructions) - CO
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SCHEDULE 13D
ITEM 1. SECURITY AND ISSUER
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This Schedule 13D relates to the shares of common stock of Inprise
Corporation, whose principal executive offices are located at 100 Enterprise
Way, Scotts Valley, California 95066-3249.
ITEM 2. IDENTITY AND BACKGROUND
-----------------------------------
This Schedule 13D is being filed by Corel Corporation, a Canadian
corporation ("Corel"). The principal business and principal office of Corel are
located at 1600 Carling Avenue, Ottawa, Ontario, Canada K1Z 8R7. Corel develops,
manufactures, licenses, sells and supports a wide range of software products,
including graphics, business productivity, and consumer applications.
(a)-(c); (f) The name, business address, present principal occupation or
employment, and the name and principal business of any corporation or other
organization in which such employment is conducted of each of the directors and
executive officers of Corel is set forth in Schedule I hereto which is
incorporated herein by reference. The citizenship of each person listed in
Schedule I is indicated thereon.
(d)-(e) During the last five years, neither Corel nor, to the knowledge
of Corel, any of the persons listed on Schedule I hereto (i) has been convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (ii) has been a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceeding was or is
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
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Corel and Inprise Corporation entered into a Merger Agreement dated as of
February 6, 2000 (the "Merger Agreement"). Pursuant to the Merger Agreement,
Carleton Acquisition Co., a Delaware corporation and a wholly-owned subsidiary
of Corel ("Corel Merger Sub"), will merge (the "Merger") with and into Inprise
Corporation, a Delaware corporation, with Inprise as the surviving corporation,
such that Inprise would become a wholly-owned subsidiary of Corel. Pursuant to
the terms of the Merger Agreement, (i) each issued and outstanding share of
common stock of Inprise, par value $0.01 per share ("Inprise Common Stock"), not
owned or held by Inprise will be exchanged for 0.747 ("Conversion Number")
shares of validly issued, fully paid and nonassessable shares of Corel common
stock, no par or nominal value per share ("Corel Common Stock"); (ii) each
issued and outstanding share of Inprise's series C preferred stock, par value
$0.01 per share ("Inprise Series C Stock") will be converted into the right to
receive such number of validly issued, fully paid and nonassessable shares of
Corel Common Stock to the same extent as if the Inprise Series C Stock had first
been converted into Inprise Common Stock; (iii) the outstanding warrants or
options to purchase Inprise Common Stock that were granted under the Inprise
Option Plans (as defined in the Merger Agreement) and the stock option
agreements executed pursuant thereto, will be assumed by Corel and continued in
accordance with their respective terms and each such warrant or option will
become a right to purchase a number of shares of Corel Common Stock equal to the
Conversion Number multiplied by the number of shares of Inprise Common Stock
subject to such warrant or option immediately prior to the consummation of the
Merger; and (iv) the offering in process under the Inprise employee stock
purchase plans (collectively, the "ESPP") will continue, and as of the Effective
Date, each participant will receive the number of whole shares of Corel Common
Stock or cash into which shares of Inprise Common Stock such participant has so
purchased under the ESPP have been converted pursuant to the terms set forth in
the Merger Agreement. Each whole share of Corel Common Stock that is issued will
be issued together with one associated Corel Common Stock purchase right.
In order to facilitate the consummation of the transactions contemplated
by the Merger Agreement and in consideration thereof, Corel entered into a Stock
Option
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Agreement (the "Option Agreement"), dated as of February 6, 2000, with Inprise.
Pursuant to the Option Agreement, Inprise granted to Corel an irrevocable option
(the "Option") to purchase up to 12,000,000 shares of Inprise Common Stock,
subject to adjustment as described below, at a purchase price per share equal to
$14.94 per share. The number of shares of Inprise Common Stock subject to the
Option will automatically adjust to remain equal to 19.7% of the Inprise Common
Stock issued and outstanding. The Option is not currently exercisable and may
only be exercised under certain circumstances described in the Option Agreement
and outlined in this Schedule 13D. If the Option were to become exercisable, the
purchase price required to purchase all shares of Inprise Common Stock subject
to the Option would be $179,280,000. The Option may be exercised for cash or
pursuant to a cashless exercise in accordance with its terms. Corel anticipates
that any funds to be paid by it upon exercise of the Option would be provided
from cash on hand and cash available from external sources, including proceeds
from debt or equity issuances. Corel did not pay additional consideration to
Inprise in connection with Inprise entering into the Option Agreement and
granting the Option, but Corel granted a reciprocal option to Inprise to
purchase up to 19.8% of the issued and outstanding Corel Common Stock at a price
of $20.00 per share, subject to similar terms and conditions in the Option
Agreement.
References to, and descriptions of, the Merger Agreement and the Option
Agreement as set forth above in this Item 3 are qualified in their entirety by
reference to the copies of the Merger Agreement and the Option Agreement listed
as Exhibits 1 and 2, respectively, to this Schedule 13D, and are incorporated in
this Item 3 in their entirety where such references and descriptions appear.
ITEM 4. PURPOSE OF TRANSACTION
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The information set forth or incorporated by reference in Items 2 and 3 is
hereby incorporated herein by reference.
Upon consummation of the Merger as contemplated by the Merger Agreement,
(a) the Certificate of Incorporation and Bylaws of Inprise will be the
Certificate of Incorporation and Bylaws of the surviving corporation of the
Merger, (b) the officers of Inprise and the directors of Corel Merger Sub will
be the officers and directors, respectively, of the surviving corporation of the
Merger, and (c) each share of Inprise Common Stock and Inprise Preferred Stock
(both, as defined in the Merger Agreement) held by Inprise will cease to be
outstanding and will be canceled. It is also expected that the shares of Inprise
Common Stock will become eligible for termination of registration pursuant to
the Securities Exchange Act of 1934, as amended.
The Merger is subject to customary closing conditions, including the
adoption of the Merger Agreement by both Corel's stockholders and Inprise's
stockholders, the expiration of the applicable waiting period under the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the
Competitions Act (Canada) the receipt of any other required United States or
Canadian regulatory approvals, and the satisfaction or waiver of certain other
conditions as more fully described in the Merger Agreement. There can be no
assurance that the required approvals will be obtained in a timely fashion, if
at all, or, in the case of regulatory approvals, if obtained, will not contain
certain conditions. Each of Corel and Inprise agrees that, during the period
from February 6, 2000 through the consummation of the Merger, neither it nor any
of its subsidiaries or other affiliates will purchase any shares of capital
stock of the other party.
Pursuant to the terms and subject to the conditions set forth in the
Option Agreement, Corel may exercise the Option, in whole or in part, at any
time or from time to time after the Merger Agreement becomes terminable by Corel
under circumstances which would entitle Corel to receive the Specified Amount
(as defined in Section 8.02(b) of the Merger Agreement). Notwithstanding
Corel's right to receive the Specified Amount, if the Total Profit (as defined
in the Option Agreement) less certain adjustments received by Corel and its
affiliates in connection with (i) the proceeds from the sale of Inprise Common
Stock less its basis, (ii) any amounts received by Corel and its affiliates on
the transfer of the Option pursuant to the Option Agreement and (iii) the
Specified Amount should Corel receive such amount, exceeds $30 million, then
Corel must make certain adjustments as set forth in the Option Agreement so that
its actual realized Total Profit will not exceed $30 million after taking into
account such adjustments.
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The Option will terminate upon the earlier of: (i) the effective time of
the Merger; (ii) the termination of the Merger Agreement pursuant to Section
8.01 thereof (other than a termination in connection with which Corel is or may
be entitled to the payment specified in Section 8.02 thereof); and (iii) 5:00
p.m., California time, on the date that is the one year anniversary of the
termination of the Merger Agreement in connection with which Corel is or may be
entitled to the payment specified in Section 8.02 thereof (or if, at the
expiration of such one year period, the Option cannot be exercised by reason of
any applicable judgment, decree, order, law or regulation, ten business days
after such impediment to exercise will have been removed or has become final and
not subject to appeal).
Notwithstanding the termination of the Option, Corel is entitled to
purchase those shares subject to the Option with respect to which it may have
exercised the Option by delivery of an Exercise Notice (as defined in the Option
Agreement) prior to the Expiration Date, and the termination of the Option will
not affect any rights under the Option Agreement which by their terms do not
terminate or expire prior to or at the Expiration Date.
Upon the occurrence of certain events set forth in the Option Agreement,
upon demand by Corel, Corel will have the right to sell to Inprise and Inprise
will be obligated to repurchase from Corel the Option and the shares of Inprise
Common Stock issued pursuant to the Option to Corel. In addition, the Option
Agreement grants certain registration rights to Corel with respect to the shares
of Common Stock subject to the Option.
The Option is not currently exercisable, and until the Option becomes
exercisable and is exercised, Corel does not have any right to vote (or to
direct the vote of) or dispose (or to direct the disposition of) any shares of
Inprise Common Stock that may be purchased upon exercise of the Option.
Accordingly, Corel expressly disclaims beneficial ownership of all such shares.
References to, and descriptions of, the Merger Agreement and the Option
Agreement as set forth above in this Item 4 are qualified in their entirety by
reference to the copies of the Merger Agreement and the Option Agreement listed
as Exhibits 1 and 2, respectively, to this Schedule 13D, and are incorporated in
this Item 4 in their entirety where such references and descriptions appear.
Capitalized terms used in Item 4 but not otherwise defined herein have the
respective meanings assigned to them in the Merger Agreement.
SCHEDULE 13D
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
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The information set forth or incorporated by reference in Items 2, 3 and 4
is hereby incorporated herein by reference.
The number of shares of Inprise Common Stock covered by the Option is
12,000,000 (representing approximately 19.8% of the shares of Inprise Common
Stock issued and outstanding as of January 31, 2000, as represented by Inprise
in the Merger Agreement).
The Option is not currently exercisable, and until the Option becomes
exercisable and is exercised, Corel does not have any right to vote (or to
direct the vote of) or dispose (or to direct the disposition of) any shares of
Inprise Common Stock that may be purchased upon exercise of the Option.
Accordingly, Corel expressly disclaims beneficial ownership of all such shares.
Other than as set forth in this Schedule 13D, to the best of Corel's
knowledge as of the date hereof (i) neither Corel nor any subsidiary or
affiliate of Corel nor any of Corel's executive officers or directors
beneficially owns any shares of Inprise Common Stock, and (ii) there have been
no transactions in the shares of Inprise Common Stock effected during the past
60 days by Corel, nor to the best of Corel's knowledge, by any subsidiary or
affiliate of Corel or any of Corel's executive officers or directors.
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No other person is known by Corel to have the right to receive or the
power to direct the receipt of dividends from, or the proceeds from the sale of,
the shares of Inprise Common Stock obtainable by Corel upon exercise of the
Option.
Reference to, and descriptions of, the Merger Agreement and Option
Agreement as set forth in this Item 5 are qualified in their entirety by
reference to the copies of the Merger Agreement and the Option Agreement listed
as Exhibits 1 and 2, respectively, to this Schedule 13D, and incorporated in
this Item 5 in their entirety where such references and descriptions appear.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
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RESPECT TO SECURITIES OF THE ISSUER.
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The information set forth, or incorporated by reference, in Items 3
through 5 is hereby incorporated hereby by reference.
Copies of the Merger Agreement and the Option Agreement are incorporated
by reference as Exhibits 1 and 2, respectively, to this Schedule 13D. To the
best of Corel's knowledge, except as described in this Schedule 13D, there are
at present no other contracts, arrangements, understandings or relationships
among the persons named in Item 2 above, and between any such persons and any
person, with respect to any securities of Inprise.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
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Exhibit Description
1. Merger Agreement, dated as of February 6, 2000, among Corel
Corporation, Carlton Acquisition Co. and Inprise Corporation (filed as
Exhibit 99.1 to Inprise Corporation's Current Report on Form 8-K dated
February 9, 2000 and incorporated herein by reference).
2. Stock Option Agreement, dated as of February 6, 2000, by and between
Inprise Corporation and Corel Corporation (filed as Exhibit 99.3 to
Inprise Corporation's Current Report on Form 8-K dated February 9, 2000
and incorporated herein by reference).
SIGNATURE
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After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
February [17], 2000
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Date
COREL CORPORATION
By: /s/ Michael C.J. Cowpland
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Name: Michael C.J. Cowpland
Title: Chief Executive Officer
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SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF COREL CORPORATION
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer of
Corel. Each such person is a Canadian citizen, and unless noted below, the
business address of each such person is 1600 Carling Avenue, Ottawa, Ontario,
Canada K1Z 8R7.
Board of Directors
Name and Title Present Principal Occupation
Michael C.J. Cowpland Chairman, Chief Executive Officer and
President of Corel Corporation
Lyle B. Blair Director of Corel Corporation; President
of Blairhampton Properties Inc. (a
privately owned property development
company) 29 Forest Hill Road, Toronto ON
M4V 2L4
Honourable William G. Director of Corel Corporation; Counsel,
Davis, P.C., C.C., Q.C. Torys, Barristers and Solicitors
Hunter S. Grant Director of Corel Corporation; President
of Kingmer Holding Ltd. (holding
company)
Jean-Louis Malouin Director of Corel Corporation; Dean,
Faculty of Administration, University of
Ottawa 136 Jean-Jacques Lussier, Ottawa
ON K1N 6N5
Honorable Barbara J. Director of Corel Corporation; President
of McDougall, P.C., CFA, The Canadian
Institute of International LLD (Hon.)
Affairs (a non-partisan nation-wide
forum for discussion, analysis and
debate of international affairs)
c/o Glendon Hall, 2/nd/ Floor Glendon
College Campus 2275 Bayview Avenue
Toronto, ON M4N 3M6
Executive Officers Of Corel Corporation Who Are Not Directors
Name Title and Present Principal Occupation
Derek Burney Executive Vice President, Engineering
Sandra Gibson Executive Vice President, Corporate Services
Tony O'Dowd Executive Vice President, International Product
Development; General Manager, Corel Corporation
Limited
Ross Cammellari Executive Vice President, Marketing
Eric Smith Vice President, General Counsel and Secretary
Carey Stanton Executive Vice President, Business Development
Kerry D. Williams Executive Vice President, Manufacturing
Mitch Desrochers Vice-President, Finance and Controller
Steve Houck Executive Vice-President, Sales
