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Reuters: Corel strikes finance deal worth up to C$30 million

May 26, 2000, 01:52 (0 Talkback[s])

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"Embattled Canadian software developer Corel Corp. said late on Thursday it had secured a much-needed financial lifeline, adding C$15 million in a bought deal financing agreement, with an option for an additional C$15 million."

"Corel said after a trading halt that it had struck the deal with Canaccord Capital Corp., which includes an option for an additional C$7.5 million at Canaccord's discretion. By mutual agreement, Corel and Canaccord can add another C$7.5 million to the deal. The number of shares and the price will be determined based on an amount equal to 90 percent of the average closing price of Corel common stock on the Toronto Stock Exchange in the next four trading days."

"It's the first step in our comprehensive plan," Corel chief financial officer John Blaine told Reuters. "Our next step will be to concentrate on finalising our cost savings plan." Corel did not disclose its cash reserves because it is in a quiet period in advance of its quarter closing on May 31, but insisted it can meet its financial obligations. "We're very comfortable we will will continue to meet our obligations," Blaine said, adding that Corel reviewed between six to eight financing options. "This is the only equity financing we're pursuing."

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