**UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549**

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**FORM 10-K**

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(MARK ONE)

**[X]   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934**

**For the fiscal year ended November 30, 2000**

**OR**

**[   ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934**

**FOR THE TRANSITION PERIOD FROM ___________ TO  _____________**

**Commission file number 0-20562**

**COREL CORPORATION**
(Exact name of Registrant as Specified in its Charter)



|**Canada**                                                     | **Not Applicable**                     
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

**1600 Carling AvenueOttawa, Ontario, Canada     KIZ 8R7**(Address of Principal Executive Offices including Zip Code)

**(613) 728-8200**(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

**Title of Each Class**

**Common shares, no par value**

**Common share purchase rights**

Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90 days. Yes    [X]
     No [   ]

Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K (Section 229.4054 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.  [X]

As of February 21, 2001, the aggregate market value of Common Shares held by
non-affiliates of the registrant, based on the closing sales price of $2.19 of the Registrant's Common Shares
as reported on the NASDAQ National Market,
was $161,112,814. As of that date 73,651,572 Common Shares were issued and
outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

None







**COREL CORPORATION
                                             FORM 10-K
                       For The Fiscal Year Ended November 30, 2000
                                             Index**



|Part I.        |                                                                                       | Page
|-------------- | ------------------------------------------------------------------------------------- | ----
|Item 1.        | Business                                                                              | 3   
|Item 2.        | Properties                                                                            | 9   
|Item 3.        | Legal Proceedings                                                                     | 9   
|Item 4.        | Submission of Matters to a Vote of Security Holders                                   | 10  
|Part II.       |                                                                                       |     
|Item 5.        | Market for the Registrant's Common Equity and Related Stockholder Matters             | 10  
|Item 6.        | Selected Consolidated Financial Data                                                  | 11  
|Item 7.        | Management's Discussion and Analysis of Financial Condition and Results of Operations | 12  
|Item 7a.       | Quantitative and Qualitative Disclosures About Market Risks                           | 12  
|Item 8.        | Consolidated Financial Statements and Supplementary Data                              | 12  
|Item 9.        | Changes in and Disagreements with Accountants on Accounting and Financial Disclosures | 12  
|Part III.      |                                                                                       |     
|Item 10.       | Directors and Executive Officers of the Registrant                                    | 12  
|Item 11.       | Executive Compensation                                                                | 14  
|Item 12.       | Security Ownership of Certain Beneficial Owners and Management                        | 17  
|Item 13.       | Certain Relationships and Related Transactions                                        | 17  
|Part IV.       |                                                                                       |     
|Item 14.       | Exhibits, Consolidated Financial Statement Schedules and Reports on Form 8-K          | 17  
|Signatures     |                                                                                       | 19  
|Exhibits Index |                                                                                       | 20  

All financial information contained in this report is expressed in United States dollars,
unless otherwise stated.

---

**PART I**

PART I

**Item 1.  Business**

******GENERAL**



Corel develops, manufactures, licenses, sells and supports a wide range of software
products including
graphics, business productivity and consumer.  Corel products are available for users of most PCs, including
International Business Machines ("IBM") Corporation and IBM-compatible PCs, Apple Computer Inc.'s
Macintosh® ("Mac") and Linux-based systems. In 2001, the Company plans continue to expand its support of
the Web, delivering the Internet's versatility to customers through web-based applications, content and
services. Corel also plans to develop applications for Microsoft Corporation's ("Microsoft") .NET platform
as part of services to be available on multiple platforms.

On October 2, 2000, Corel announced a strategic alliance with Microsoft.  The Company
issued 24,000,000
Series A, participating convertible, non-voting, non-redeemable preferred shares to Microsoft for total gross
proceeds of $135.0 million ($5.625 per share).  Each preferred share is convertible into one common share but
not in the hands of Microsoft or its affiliates. As part of the share purchase agreement the Company is
obligated to file, with the United States Securities and Exchange Commission ("SEC") a resale registration
statement for 24,000,000 common shares underlying these preferred shares. Under the terms of a technology
and services agreement the companies will work together to support the development, testing and marketing
of new products related to the .NET platform and, upon request from Microsoft at any time prior to October
2, 2003, Corel is obligated to provide 30 full time equivalents (20 developers and 10 testers) for a 12 month
period to port the .NET platform from the Windows platform to the Linux platform.  The Company has
deducted from equity $3.0 million of the total money received from Microsoft for this future possible
obligation.

Corel's business strategy emphasizes the development of a broad line of software
application products for
business, academic and personal use, marketed through multiple channels of distribution. Corel is divided into
two main product groups: Creative Products and Business Applications Products and various supporting
departments.

The Creative Products group develops graphics software applications designed for
business, academic and
home markets.

The Business Applications Products group creates business productivity applications
designed for the business,
academic and home markets.

The Sales department is responsible for building long-term business relationships with
customers. This
department is organized to serve three main customer types: end-users, original equipment manufacturers
("OEMs") and enterprises. The department also focuses directly on large organizations, offering tailored
license programs and organization-wide support. The department manages the channels that serve customers
by working with distributors, resellers and OEMs. The Customer Service and Technical Support departments
support Corel's products with technical support and customer service for end-users and organizations.

Other supporting departments are responsible for managing business operations and
overall business planning.
This includes the process of manufacturing and delivering finished goods and licenses, as well as corporate
functions such as finance, administration, human resources, legal, business development and information
technology.

The Company has only one global operating segment and sells its products worldwide from
three geographic
regions. Note 15 to the Consolidated Financial Statements (see Item 8) is incorporated herein by reference.

|**PRODUCTS** | **Creative Products**
|------------ | ---------------------

The Creative Products group develops graphics applications software, which provides
instructions for creating
and manipulating graphics, text, or numbers. Corel's graphics applications are designed to meet the needs of
general business users and graphics professionals. Primary examples of graphics applications include
illustration, photo editing and painting, 3D rendering, and animation programs. Corel's graphics applications
programs are developed principally for Microsoft® Windows® ("Windows"), Macintosh and Linux operating
systems and are available in English and French.

**CorelDRAW®.**CorelDRAW is asuite of software programs featuring integrationof all of the major graphics
functions that share a common "look and feel".  CorelDRAW modules feature common commands and
extensive use of object linking and embedding ("OLE") cross-application capabilities. CorelDRAW is
available in several versions, with certain combinations of modules, supporting utilities, clipart images, fonts
and photos available for the various operating system platforms.

The CorelDRAW module is an illustration program allowing users to produce color
illustrations incorporating
both text and objects. The Corel PHOTO-PAINT® module is a photo-editing and painting module that enables
users to apply global photo-retouching and pixel by pixel editing to scanned or photographic images.
Supporting utilities include: Microsoft® Visual Basic® for Applications 6.2, a supporting application which
allows developers to build custom business solutions by automating and integrating off-the-shelf software
applications to meet specific customer needs;Canto® Cumulus® Desktop LE 5.0, a tool that organizes media
and graphics files into a catalog which can be indexed so that users can find images,designs, clipart, stock
photosand QuickTime® movies quickly and
easily;Bitstream® Font
NavigatorTM 4.0, a tool that allows users
a quick and easy way to find, install and  organize fonts into manageable groups and view and print font
samples; Corel TEXTURETM, a tool for creating realistic natural textures; CorelTRACETM, a
bitmap-to-vector
conversion utility for images and text; Corel CAPTURETM, a tool for capturing portions of the, or the entire,
application window; Corel R.A.V.E.TM, is a new product that gives users the ability to create effects that take
place over a period of time, resulting in an animation. CorelDRAW also includes Adobe® Acrobat® Reader
and Adobe® Photoshop® compatible plugin filters, including Digimarc® Digital Watermarking and Human
Software Squizz!TM.

CorelDRAW has a leading market share in the illustration segment
of the Windows graphics software market
with an installed base of over 12.4 million units worldwide.



**Corel PHOTO-PAINT®.**Corel PHOTO-PAINT is a comprehensive photo-editing, image composition and
painting application. Corel PHOTO-PAINT 10 features a variety of image-enhancing filters to improve the
quality of scanned images and special effects filters that dramatically alter the appearance of images, such as
the new Red Eye Removal and Smart Blur filters.Corel
PHOTO-PAINT is available in various versions for
various operating systems.



******Corel VENTURA**
**TM****.**Corel VENTURA is a
suite of high-end desktop publishing software programs for
publishing documents of any size, length or complexity. The latest version of Corel VENTURA allows users
to publish Corel VENTURA documents to HTML, portable electronic formats, such as EnvoyTM and Adobe
Acrobat, a CD-ROM, over an internal network, or on the Internet.

**KPT®********.**KPT is a collection of image filters that produce spectacular effects for print and the Web. KPT
includes  plug-ins that extend and enhance the creative possibilities of Adobe Photoshop and compatible
products.

**Bryce®**. Bryce is an
easy way to create, explore and animate extraordinary imagery for multimedia, video
and the Web.

**Corel® Painter** **TM.**Corel Painter, the ultimate
Natural-Media® painting tool, delivers hundreds of
brushes and creative materials, opening new horizons in high-quality output for print and the Web.

**Corel® KnockOut.** Corel KnockOut is a masking tool that can perform
complex masking functions, while
preserving fine image details, such as blurred or  out of focus edges, hair, smoke and shadows.

| | **Business Applications**
| | -------------------------

Corel's Business Applications products are designed for use by a broad class of
end-users, regardless of
business, industry, or market segment. Primary examples of productivity software applications are word
processing, spreadsheet, and presentation graphics programs. Corel's productivity software applications are
developed for the Windows, Macintosh, DOS and Linux operating systems and are available in English
and French.

**Corel® WordPerfect® Suite.**  Corel WordPerfect suite is a suite
of software programs featuring seamless
integration of the most commonly used desktop applications. Corel WordPerfect suite combines document
creation with graphics and Internet capabilities. There are several versions of Corel WordPerfect suite
available.

WordPerfect Office 2000 contains WordPerfect, Quattro Pro , Corel Presentations and
Trellix2 desktop
web publishing.  Corel also offers a version of Corel WordPerfect suite for legal professionals,
WordPerfect® Law Office 2000 - Legal Edition. WordPerfect Law Office 2000 - Legal Edition offers all
the features found in the WordPerfect Office 2000 along with industry-specific applications and resources.
WordPerfect Office 2000 Voice-Powered Edition includes all of the above features in addition to the
speech recognition technology of Dragon NaturallySpeakingTM.

**Corel**®**WordPerfect**®**Suite
Professional.**  Corel WordPerfect Suite Professional is a suite of software
programs that includes enhanced Internet connectivity, graphics and database features. WordPerfect Office
2000  Professional includes WordPerfect, Quattro Pro, Corel Presentations, Paradox® 9,
CorelCENTRALTM 9 and Trellix® 2, a tool which simplifies the process of creating and managing a Web
site.

**WordPerfect®.** WordPerfect is Corel's principal word processing
program, providing all the features that
users of word processing products expect plus the ability to handle graphics, tables, spreadsheet data,
charts, and images imported from other software programs.

**Quattro® Pro.** Quattro Pro is an integrated spreadsheet with
database, business graphics and Internet
capabilities.

**Paradox®.**  Paradox, a powerful data management tool, delivers
advanced features such as the ability to
publish a database to the Web.

**Corel**®**PresentationsTM.**  Corel Presentations is a
presentation graphics program for producing slides,
overheads, transparencies and prints.



| | **Linux Operating
System**
| | --------------------------

Corel® LINUX® OS is built specifically for the desktop and is offered in two
versions: Corel LINUX -
Standard Edition and Corel LINUX - Deluxe Edition. Based on the Debian version of Linux, this system
delivers an easy-to-use, four-step graphical installer that automatically detects most PCI hardware. Features
include a KDE-based, drag-and-drop desktop environment and a browser-style file manager.



|**RESEARCH AND DEVELOPMENT** | 
|---------------------------- | 

The PC software industry is characterized by frequent changes in technology and
user preferences, which
require constant attention to software technology trends, shifting consumer demand and rapid product
innovation. The pace of change has recently increased due to the burgeoning interest in the Internet,
networking in general, emerging interest in Linux as an operating system and new programming languages
and platforms such as Java and Microsoft's .NET platform.

Accordingly, Corel must be able to provide new software products and modify and enhance
existing
products on a timely and continuing basis to be competitive. Corel employs a strategy of internally
developing software, contracting for the development of certain products by third parties; and acquiring or
licensing technology that will, in most cases, be enhanced by Corel. Corel believes that its ability to
maintain technological competitiveness will depend in large part upon its ability to successfully enhance its
existing products, develop new products on a timely basis and acquire or license complementary
technologies and products in a timely manner. The Company strives to become as informed as possible at
an early stage about changing usage patterns and hardware advances that may affect software design.

Corel's research and development expenses were $71.9 million,  $40.0 million and $43.9
million in fiscal
1998,  1999 and 2000, respectively. Those amounts represented approximately 29%, 16% and 28%
respectively, of sales in each of those years. Software acquired or licensed for incorporation into Corel's
product line totaled $4.7 million in fiscal 1998, $15.4 million in fiscal 1999 and $13.5 million in fiscal
2000. Corel intends to continue significant expenditures for research and development activities.

|**MANUFACTURING** | 
|----------------- | 

The principal materials and components used in Corel's products include computer
media (diskettes, CD-ROMs or tapes) and documentation. Corel is often able to acquire component parts and materials on a
volume discount basis.

Corel contracts all of its manufacturing activity to third parties. Manufacturing
involves the duplication of
computer media and user manuals, assembly of components, spot testing of the product and final
packaging, all in accordance with Corel's specifications. Corel believes there is an adequate supply of and
source for the raw materials used in its products, and that multiple sources are available for media
duplication, manual printing and final packaging. Corel's products are generally shipped as orders are
received and accordingly, Corel has historically operated with little backlog.

|**MARKETING, SALES AND DISTRIBUTION** | 
|------------------------------------- | 

Corel's marketing and sales efforts are directed towards several customer types
including end-users,
corporate accounts, and OEMs. Corel's marketing and sales staff seek to build long-term relationships with
customers and end-users of Corel products. In addition to the OEM channel, Corel has four major
geographic sales and marketing areas: North America, Latin America, Europe and Asia-Pacific.****

End-user marketing activities cover all of Corel's products and target end-users who
make individual
buying decisions for the PCs they use at work or at home. Marketing activities aimed at end-users include
developing and administering reseller relationships, channel marketing and promotions, end-user marketing
programs and seminars, events and product training for resellers.

The corporate licensing unit has responsibility for sales and marketing activities that
target groups of users
in all organizations and enterprises. The unit works directly with these organizations and enterprises, as
well as with channel partners such as distributors, value-added resellers and large account resellers, to
provide complete desktop productivity solutions to this customer segment. The unit's sales and marketing
activities include providing technical training to channel resellers, supporting and providing seminars,
events, and sales training for channel partners. The unit also has responsibility for administering the Corel
License Programs worldwide. Key products for the corporate licensing unit are graphics and productivity
software applications.

The OEM customer unit works with original equipment manufacturers that pre-install or
bundle Corel
software on their PCs or peripheral hardware.

| | **Finished Goods
Channels**
| | ---------------------------

**Distributors and Resellers.**  Corel sells its products worldwide to over
160 distributors for resale through
software resellers. Distributors include Ingram Micro, Merisel, Tech Data, and Navarre. Resellers include
ASAP Software and Software House International. Within the United States and Canada, Corel has sales
representatives and support personnel who solicit orders from distributors and resellers and provide
product training and sales support. In other countries, Corel's marketing personnel provide product training
and sales support.

**Licensing.**  Corel has a program designed to make it easier for large or
small organizations to acquire and
maintain Corel products. The Corel License Program ("CLP") consists of three separate programs. CLP
Universal offers flexible software acquisition, licensing and maintenance options specially designed to
meet the needs of large multinational organizations. Targeted audiences include technology specialists and
influential end-users in large enterprises. Marketing efforts and fulfillment are generally coordinated
through Corel's network of large account resellers.  CLP Choice offers flexible software acquisition and
licensing options specially designed to meet the needs of small and medium sized organizations. Marketing
efforts and fulfillment are generally coordinated through Corel's network of distributors and resellers.
CLP Freedom is designed to make it easy and affordable for organizations to standardize on a single
software solution.  This package allows organizations to license Corel's business or graphics software
products for a one- or a two-year term.  The minimum licensing commitment to qualify is only 100
employees or workstations within an entire organization or a defined portion of an organization.

**Solution Partners.**  Corel's Solution Partners program is a support
relationship with independent
developers and consultants that provide products, solutions or services around Corel products.  The
program supports independent software vendors, consultants, value-added resellers ("VARs"), system
integrators, custom application developers, and solution developers; as well as technical support and
training organizations. Under this business partnership strategy, the Company provides sales and product
information, development services, access to beta software, discounts on Corel products and dedicated
developer technical support.

**Approved Service Bureaus.**  The Corel Approved Service Bureau Program
("CASB") supports
organizations that output and render files created with Corel's graphics software applications such as
CorelDRAW and Corel VENTURA. Under CASB, the Company provides members with product
information, free priority technical support and referral services through Corel's bulletin board service and
Customer Service and Technical Support networks.

**Direct Marketing.**  Corel promotes some of its products through direct
marketing techniques directed
toward existing and potential users of Corel's products. Fulfillment of product to the end-user is either by
direct shipment or through resellers.

**On-line Distribution.**Corel offers its products on-line through third
party web sites including
beyond.com,  buy.com and egghead.com as well as through their own sites which include Corel® Store and
ClipartCity.com. ****

| | **OEM
Channel**
| | ---------------

Corel markets certain productivity, graphics, and consumer software applications under
license agreements
with OEMs that grant the OEMs the right to distribute copies of Corel's products with their hardware
products. Corel has OEM agreements covering one or more of its products with most of the major PC and
peripheral hardware vendors, including Agfa, Canon, Compaq, Cybermax, Dell, Epson, Gateway 2000,
Hewlett-Packard, Packard Bell, PCChips, Quantex and Vobis.

| | **Advertising and
Promotion**
| | -----------------------------

Advertising, direct marketing, and marketing materials are targeted to various end-user
groups through a variety
of programs: (i) extensive worldwide advertising in broad consumer media and trade publications; (ii) joint
promotions with computer retailers under which qualifying resellers and OEMs are reimbursed for certain
advertising expenditures; (iii) trade show and PC user group participation; and (iv) direct corporate marketing
efforts. The Company has an in-house creative design group responsible for conceptualizing and producing
all of Corel's ad copy, box covers, and promotional material. The Company has an in-house ad agency which
places and monitors the effectiveness of Corel's worldwide advertising. The Company maintains a broad
advertising campaign emphasizing the Corel brand identity.

|**CUSTOMERS** | 
|------------- | 

As described above, Corel has three main customer types: end-users, organizations
or enterprises, and OEMs.
Most end-users of Corel products are individuals in business, government agencies, educational institutions
and at home. These end-users obtain Corel products primarily through distributors, resellers, and OEMs. Note
15 to the Consolidated Financial Statements (see Item 8) identifies, by name as required, customers that
represent more than 10% of Corel's revenues.

|**PRODUCT SUPPORT** | 
|------------------- | 

Corel provides product support coverage options to meet the needs of users of
Corel products. Support
personnel are located in Ottawa, Ontario. Certain support is also provided by qualified third-party support
organizations in accordance with Corel's specifications for quality and timeliness of the support response.
Corel generally hires individuals with product expertise and provides them with the productivity tools,
continuous product education, training and consistent processes to deliver quality support for Corel products.
Coverage options currently range from standard no-charge toll telephone support to fee-based offerings
providing unlimited toll-free telephone and technical support for all Corel products 24 hours per day, 7 days
per week.

Users have access to Corel's Knowledge Base, a database of technical support articles
that is updated regularly
with useful information regarding Corel products. Corel provides access to Knowledge Base, technical support
information and frequently asked question and answers via Corel's worldwide web site on the Internet
(*http://www.corel.com*). Corel maintains a bulletin board service for European customers and a forum on
CompuServe to provide users with a mechanism to provide feedback as well as receive technical updates and
notes. Additionally, users can access Corel's automated "Fax on Demand" system where up-to-date
information about common issues and tips and tricks is stored in numbered documents.

Corel's Customer Service representatives, including a number of third-party
organizations, answer questions
about product specifications and pricing, sell Corel products, and issue replacement media and documents.

|**COMPETITION** | 
|--------------- | 

Competition within distribution channels may adversely affect the Company's
business. Corel competes with
other software vendors for access to distribution channels, retail shelf space and the attention of customers at
the retail level  and in corporate accounts. Other competitors with greater market share and significantly greater
financial resources may command the attention of the retail accounts, the corporate market and original
equipment manufacturers. In order to compete for distribution channel space we must offer compelling reasons
to distribute our product at a reasonable price that offers compatibility with competitive products. we must also
use innovative marketing ideas in order to compel the distributor to carry our products. Inability to maintain
distribution channel space could have a material adverse affect on our business, results of operations and
financial condition.

The marketplace is intensely competitive and rapidly changing and we may not be abl e to
compete successfully
in the future. The software industry is highly competitive and subject to rapid technology change. Many of our
current and potential competitors have larger technical staffs, more established and larger marketing and sales
organizations and significantly greater financial resources. The rapid pace of technological change constantly
creates new opportunities for existing and new competitors and can quickly render existing technologies less
valuable. As the market for our products continues to develop, additional competitors may enter the market and
competition may intensify. Inability to compete in the following factors could have a material adverse affect
on our business, product performance, product features, ease of use, reliability, hardware and competitor
compatibility, brand name recognition, product reputation, pricing levels of advertising, availability and quality
of customer support, and timeliness of product upgrades. We compete in the following areas with a variety of
companies, including:

Graphics

The Company's graphics software products face substantial competition from a wide
variety of companies.
In the illustration graphics segment, our competitors include Adobe Systems Incorporated, JASC Software,
Inc., Macromedia Inc., Micrografx, Inc. and Microsoft. In the desktop publishing segment, our competitors
include Adobe Systems, Inc. Our competitors also include many independent software vendors, such as
Autodesk, Inc., and Apple Computer Inc.

Business Productivity

The Company's competitors in the productivity software (primarily office suites)
marketplace include
Microsoft, IBM (Lotus Development Corporation), Sun Microsystems, Inc., Red Hat, Inc., and Applix Inc.
According to industry sources, Microsoft currently has the largest overall market share for office suites. IBM
has a large installed base with its spreadsheet program. Also, IBM preinstalls some of its software products
on various models of its PCs, competing directly with the Company's productivity software.

|**PROPRIETARY RIGHTS** | 
|---------------------- | 

Corel regards certain features of its internal operations, software and
documentation as proprietary and relies
on contract, patent, copyright, trademark, and trade secret laws and other measures to protect its proprietary
information. The Company believes, however, that due to the rapid pace of innovation within its industry,
factors such as the technological expertise and creative skills of its personnel are more important to establishing
and maintaining technological leadership than are the various legal protections of its technology.

Corel provides its products to end users under non-exclusive licenses, which generally
have a perpetual term,
with the exception of academic licences, and are transferable provided the transferor erases or destroys its copy
of the product.  In special circumstances, Corel makes source code available for certain of Corel's products.
The provision of source code may increase the likelihood of misappropriation or other misuse of Corel's
intellectual property. Corel licenses its products pursuant to "shrink wrap" and/or "click wrap" licenses that
are not signed by licensees and therefore may be unenforceable under the laws of certain jurisdictions. In
addition, the laws of some foreign countries do not protect Corel's proprietary rights to the same extent as do
the laws of Canada and the United States.

From time to time Corel receives notices from third parties asserting that Corel has
infringed their patents or
other intellectual property rights. Corel may find it necessary or desirable in the future to obtain licenses from
third parties relating to one or more of its products or relating to current or future technologies. There can be
no assurance that third parties will not assert infringement claims against Corel in the future with respect to
current or future products or that any such assertion will not require Corel to enter into royalty arrangements
or result in costly litigation. As the number of software products in the industry increases and the functionality
of these products further overlap, Corel believes that software developers may become increasingly subject
to infringement claims. Any such claims, with or without merit, can be time consuming and expensive to
defend.

|**EMPLOYEES** | 
|------------- | 

As of February 21, 2000, Corel employed approximately 800 people on a full-time
basis. Corel's success
depends to a significant extent upon the performance of Corel's executive officers and key technical, sales and
marketing personnel. Corel believes that its future success will also depend in large part on its ability to attract
and retain highly skilled technical, managerial and sales and marketing personnel. Competition for employees
is intense in the software industry. To date, Corel believes it has been successful in its efforts to recruit
qualified employees, but there can be no assurance that Corel will continue to be as successful in the future.
None of Corel's employees are subject to collective bargaining agreements. Corel believes relations with its
employees are favourable.

**Item 2.  Properties**

Corel leases 177,000 square feet of office
space in a facility located in Ottawa, Ontario under leases that expire
in 2015; 13,025 square feet of office space under a lease that expires in 2002 in another facility in Ottawa,
Ontario; 7,292 square feet of office space in a facility located in Dublin, Ireland under leases that expire in
2025 and smaller office spaces in various countries around the world. The Company believes that its facilities
will be adequate for its immediate needs and that additional or substitute space is available if needed to
accommodate expansion.

**Item 3.  Legal and Government Proceedings**

On December 15, 1999, Corel filed suit
against the United States of America in the U.S. District Court for the
District of Columbia, in Washington, D.C., for the actions of its agency, the Department of Labor in
conducting an unlawful procurement. The Complaint claims that, in its goal to standardize its office automation
suite, the Department of Labor violated various statutes, regulations and treaties by "sole-sourcing" its contract
to a competing vendor rather than conduct an open and fair procurement in accordance with U.S. law. In
dispute is the decision by the Department of Labor to standardize on a competing product despite the fact that,
at the time of the award, the WordPerfect family of products was licenced for a majority of the Department's
20,000 work stations. It is believed that the three-year standardization deal with the competing vendor could
be valued as high as US $8 million. As a remedy, Corel is seeking an immediate injunction against the further
implementation of the "sole source" contract and to have it declared void. Corel is also seeking to have the
standardization process and related procurement activities tendered in a fair and open competition in
accordance with the applicable statutes, regulations and treaties. The Answer to the Complaint was filed by
the Government on March 21, 2000. The Government has filed a motion to have Corel's action dismissed for
lack of jurisdiction and, in the alternative, for summary judgment. Corel filed its motion for preliminary
injunction. All motions were argued on August 11, 2000 in conjunction with arguments on the merits of the
case. The decision of the court is pending.

On October 14, 1999, the Ontario Securities Commission filed charges
against Dr. Michael C.J. Cowpland,
the Company's former Chairman, President and Chief Executive Officer and his holding company, M.C.J.C.
Holdings Inc., in the Ontario Court of Justice. The charges include four counts of violating provisions of the
Ontario Securities Act related to insider trading. The trial of these issues is a private matter between the
Ontario Securities Commission and Dr. Cowpland as an individual. As such, it is not expected to affect the
Company's day-to-day activities.  Dr. Cowpland  has denied all allegations by the Ontario Securities
Commission.

On March 13, 2000, the Company was served with a complaint filed against it and Dr.
Michael C.J. Cowpland
by plaintiffs Anthony Basilio and Fred Spagnola in the United States District Court for the Eastern District of
Pennsylvania.  The complaint was filed on behalf of all persons who purchased or otherwise acquired Corel
common shares between December 7, 1999 and December 21, 1999 (the "Class Period"). The complaint
alleges that the defendants violated various provisions of the federal securities laws, including Section 10(b),
Section 20(a) and Rule 10b-5 of the Securities Exchange Act of 1934, as amended, by misrepresenting or
failing to disclose material information about Corel's financial condition.  The complaint seeks an unspecified
amount of money damages. On March 29, 2000, the Company was served with a second complaint filed against
the same named defendants by plaintiff Alan Treski in the United States District Court for the Eastern District
of Pennsylvania.  This second complaint references an identical Class Period as the Basilio complaint
referenced above and contains similar allegations.  Since service of the Basilio and Treski complaints, the
Company became aware of four additional complaints filed in the same jurisdiction and one complaint filed
in the District of Massachusetts that reference an identical Class Period and contain similar allegations. At the
scheduling conference on June 14, 2000, the court appointed Fred Spagnola, Michael Perron and David
Chavez as Lead Plaintiffs, and the law firms of Weinstein, Kitchenoff Scarlato & Goldman Ltd. and Savett
Frutkin Podell & Ryan, P.C. as Co-Lead Counsel. The Court has consolidated all pending cases in the Eastern
District of Pennsylvania. An Amended Consolidated Complaint was served on or about August 14, 2000. The
Amended Consolidated Complaint references an expanded class period, from December 7, 1999 toMarch 20,
2000 (inclusive). The Companyfiled a
Motion to Dismiss the Consolidated Class Action Complaint on the
grounds of forum non conveniens and Pursuant to Rules 9(b) and 12(b)(6).  FED.R.CIV.P on October 16,
2000. On December 4, 2000 the plaintiffs filed their answer to Corel's Motion to Dismiss. Corel subsequently
filed its Reply on January 16, 2001. The motion has yet to be heard by the court. The Company intends to
aggressively defend this matter.

In January, 2001, the Company was served by the U.S. Department of Justice with a Civil Investigative
Demand ("CID"), pursuant to the Antitrust Civil Process Act, inquiring into the conduct and activities
surrounding the Microsoft purchase of Corel shares  by its October 2, 2000 agreement and ancillary
agreements. The Company is currently gathering and providing documentation in response to the demand.

On January 5, 2001, in its review of  the trading of Corel Corporation stock prior to
the announcement on
October 2, 2000 of the purchase by Microsoft of Corel shares, the Ontario Securities Commission requested
that Corel  provide a written chronology of events resulting in the announcement. The Company is also
gathering and providing information to the OSC in response to this request.



The Company is a party to a number of additional claims arising in the ordinary course
of business relating
to employment, intellectual property and other matters.  The Company believes that such claims, individually,
will not have a material adverse effect on its business, financial position or results of operations but, in the
aggregate, may have a material adverse effect on its business, financial position or results of operations. Such
possible effect cannot be reasonably estimated at this time.

**Item 4.  Submission of Matters to a Vote of Security Holders**

****None.

******PART
II**

******Item 5.
Market for the Registrant's Common Equity and Related Stockholder
Matters**

**Price Range of Common
Shares**

The Company's Common Shares are traded on The Toronto Stock Exchange (the"TSE") under
the symbol
"COR" and in the over-the-counter market on the NASDAQ National Market under the symbol "CORL". The
following table sets forth the range of quarterly high and low closing sale prices of the Common Shares in
CDN$ on the TSE and in US$ on the NASDAQ National Market within the two most recent fiscal years.

|                               |  | **FISCAL 2000**    |  | **FISCAL 1999**
|------------------------------ |  | ------------------ |  | ---------------
|                               |  | **High**           |  | **Low**        
|**The Toronto Stock Exchange** |  | (Canadian dollars)
|First Quarter                  |  | $57.95             |  | $19.70         
|Second Quarter                 |  | 21.60              |  | 3.00           
|Third Quarter                  |  | 7.70               |  | 4.30           
|Fourth Quarter                 |  | 9.05               |  | 4.01           
|**NASDAQ National Market**     |  | (US dollars)      
|First Quarter                  |  | $39.25             |  | 13.19          
|Second Quarter                 |  | 15.88              |  | 3.03           
|Third Quarter                  |  | 5.25               |  | 2.91           
|Fourth Quarter                 |  | 6.06               |  | 2.59           

As of February 21, 2001, there were 1,118 holders of record of Common Shares. A
substantial number of
Common Shares of the Company are held by depositories, brokerage firms and financial institutions in "street
name." Based upon the number of annual reports and proxy statements requested by such nominees, the
management of the Company estimates that the****number of beneficial holders of Common Shares approximates
105,000 holders**.**

**Limitations Affecting Security
Holders**

There is no law or government decree or regulation in Canada that restricts the export
or import of capital, or
affects the remittances of dividends, insurance or other payments to a non-resident holder of Common Shares.

**Dividend Policy**

The Company has neither declared nor paid cash dividends on its Common Shares since its
inception and does
not anticipate paying any dividends in the foreseeable future, but intends to retain future earnings for
reinvestment to finance the growth of its business.  Any future determination to pay dividends will be at the
discretion of the Board of Directors.  From time to time, the Company repurchases common shares for
cancellation.  There is no policy with regards to the timing or amount of common share repurchases and
cancellation.  There are no plans to repurchase and cancel common shares at this time.

**Item 6.  Selected Financial Data**

The statement of operations data set forth
below with respect to the years ended November 30, 1998, 1999 and
2000 and the balance sheet data at November 30, 1999 and 2000 are derived from the audited financial
statements of Corel incorporated by reference in Item 8 hereof and should be read in conjunction with those
financial statements and the notes thereto. The statement of operations data set forth below with respect to the
fiscal years ended November 30, 1996 and 1997 and the balance sheet data at November 30, 1996, 1997 and
1998 are derived from audited financial statements not included in this Annual Report on Form 10-K. All
amounts are in United States dollars.

|                                         | **Year
ended November 30**           
|---------------------------------------- | -------------------------------------
|                                         | **2000**                             
|                                         | (in thousands, except per share
data)
|**Canadian GAAP**                        |                                      
|                                         |                                      
|Sales                                    | $157,487                             
|                                         |                                      
|Income (loss) from continuing operations | (55,348)                             
|                                         |                                      
|Income (loss) from continuing            |                                      
|operations per share (fully diluted)     | (0.80)                               
|                                         |                                      
|Cash and short-term investments          | 127,430                              
|                                         |                                      
|Working capital                          | 106,662                              
|                                         |                                      
|Total assets                             | 218,587                              
|                                         |                                      
|Novell obligations                       | 10,000                               
|                                         |                                      
|Shareholders' equity                     | 162,644                              
|                                         |                                      

Note:   The summary financial information is prepared on the basis of Canadian GAAP, which is different
in some respects from US GAAP. Significant differences between Canadian GAAP and US GAAP
are set forth in Note 16 of "Notes to Consolidated Financial Statements" incorporated herein by
reference.

**Item 7.  Management's Discussion and Analysis of Financial Condition and
Results          of Operations**

The information set forth on pages 13-21
of the 2000 Annual Report to Shareholders is incorporated herein
by reference and is filed herewith as Exhibit 13.1.

**Item 7A. Financial Instruments - Quantitative And Qualitative Disclosures About
Market Risk**

The information set forth on page 22 of the 2000 Annual Report to Shareholders is
incorporated herein by
reference and is filed herewith as Exhibit 13.1.

**Item 8.  Financial
Statements and Supplementary Data**

The following financial statements and
related reports thereon set forth on pages 23-42 of the 2000 Annual
Report to Shareholders is incorporated herein by reference and is filed herewith as Exhibit 13.2.

- Management's Report;

- Auditors' Report;
- Consolidated Balance Sheets at November 30, 2000 and 1999;
- Consolidated Statements of Operations for the years ended November 30, 2000, 1999,
and 1998;
- Consolidated Statements of Shareholders' Equity for the years ended November 30,
2000, 1999 and
1998;
- Consolidated Statements of Cash Flows  for the years ended November 30, 2000, 1999,
and 1998;
- Notes to Consolidated Financial Statements;

**Item 9.  Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure**

****None.

******PART III**

**Item 10.  Directors and Executive Officers of the Registrant**

The following table sets forth certain
information with respect to the executive officers and directors of
Corel as at February 21, 2001:

| | **NAME**                   |  | **Age** |  | **Position with the Company**                                           
| | -------------------------- |  | ------- |  | ------------------------------------------------------------------------
| |                            |  |         |  |                                                                         
| | Derek Burney               |  | 38      |  | President and Chief Executive Officer, Director                         
| | John Blaine                |  | 39      |  | Executive Vice President, Finance, Chief Financial Officer and
Treasurer
| | Graham Brown               |  | 37      |  | Executive Vice President, Business Applications                         
| | Steve Houck                |  | 31      |  | Executive Vice President, Sales                                         
| | Ian Legrow                 |  | 30      |  | Executive Vice President, Creative Products                             
| | Annette McCleave           |  | 41      |  | Executive Vice President, Marketing                                     
| | Rene Schmidt               |  | 43      |  | Executive Vice President, Chief Technology Officer                      
| |                            |  |         |  |                                                                         
| | James Baillie              |  | 63      |  | Chairman of the Board                                                   
| | Lyle B. Blair (1)          |  | 70      |  | Director                                                                
| | Hunter S. Grant (1)        |  | 58      |  | Director                                                                
| | Jean-Louis Malouin         |  | 57      |  | Director                                                                
| | Hon. Barbara McDougall (1) |  | 63      |  | Director                                                                
| | Lawrence O'Brien (1)       |  | 51      |  | Director                                                                

________

(1)      Member of the Audit Committee

**Derek Burney**joined the Company in April 1994 as the Project Leader for
CorelFLOW.  Mr. Burney was
promoted to Technology Manager in August 1995 and then Director of CAD 3D in February 1996.  He
held this position until October 1997 when he left the Company to work at IMSI (International
Microcomputer Software Inc.) in the product group that purchased CorelCAD, Corel Visual CADD,
CorelFLOW, Corel Lumiere Suite, Corel Click & Create and Corel Family Tree Suite from the Company.
Upon his return to the Company in May 1998, Mr. Burney served as Senior Vice President - Engineering
until December 1998 at which time he was promoted to Executive Vice President, Engineering. Mr.
Burney held this position until October 2000 at which time he was named President and Chief Executive
Officer and appointed to the Board of Directors.

**John Blaine**joined the Company  in April of 2000 as Chief Financial
Officer and Executive Vice
President, Finance. Mr. Blaine is responsible for the Company's worldwide financial operations. Prior to
joining the Company Mr. Blaine served as Vice-President and Controller in the Dublin, Ohio corporate
offices of Sterling Commerce Inc., an electronic commerce software and services provider.



**Graham Brown**has been with the Company for nine years. He has served as
Developer and Project Lead
for CorelDRAW, Development Manager for Corel VENTURA Publisher and WordPerfect, and Director
of Software Development for WordPerfect Office. Prior to being named to his current position as
Executive Vice President, Business Applications in October of 2000, Mr. Brown served as Vice President
of Software Development, Business Applications from June 1998. ****

**Steven Houck** joined the Company in 1995 as a consultant for its
multimedia division. He then moved on
to become manager of the Company's OEM Accounts. In December of 1999 he moved into his current
position as Executive Vice President, Sales and is responsible for overseeing the worldwide sales
operations for the Company.

**Ian Legrow**joined the
Company in 1994 and has held various positions in product development. Prior to
being named to his current position of Executive Vice President, Creative Products in October of 2000,
Mr. Legrow served as Vice President of Software Development, CorelDraw Graphics Suite from June
1998.

**Annette McCleave**joined the Company in 1990 as a member of the
technical marketing team. She has
served as Product Manager for CorelDRAW during the release of versions 4 and 5 and went on to become
Director, then Vice-President, of Product Management. Prior to her appointment as Executive Vice-President, Marketing, in February
of 2001, Ms. McCleave served as Executive Vice President, Corporate
Communications from October 2000 until February 2001 and prior to that she served as Vice-President of
the New Ventures division from June 1998.

**Rene Schmidt**joined Corel in 1995 and brings over sixteen years of
software development experience to
his position, including several years with Instantel Inc. as Chief Software Architect and Software
Development Manager. Prior to his appointment as Executive Vice President, Linux Products, in October
of 2000, Mr. Schmidt led the scripting, common user interface and installation teams, and managed the
Paradox, Quattro Pro, Corel LINUX OS and Linux porting development teams. Mr. Schmidt was
appointed Chief Technology Officer in February, 2001.

**James C. Baillie** joined the Board of Directors as Chairman in August
2000. Mr Baillie is counsel to
Torys, Barristers and Solicitors, where he practices in the general area of business law with an emphasis on
financial institutions and securities law. Mr. Baillie was the Chair of the Ontario Securities Commission
between 1978 and 1980 and was also the initial Chair of the federal government's Task Force on the
Future of the Canadian Financial Services Sector from December 1996 to July 1997. Currently Mr Baillie
is the Chair of the Independent Electricity Market Operator (Ontario) and is a director of Sun Life
Financial Services of Canada Inc. and FPI.

**Lyle B. Blair** has been a Director since September 1989. Mr. Blair has
been Chairman of L.B. Blair
Management Ltd. since 1976. L.B. Blair Management Ltd. has owned and operated several companies
including, from 1980 to 1992, Storwal International Inc., an office furniture manufacturer, and Thames
Valley Beverages, the largest independent Ontario Pepsi bottler, from 1976 to 1988. Prior to 1976, Mr.
Blair held senior international positions with Procter & Gamble Inc. and Pepsico Inc.

**Hunter S. Grant** has been a Director since September 1989. Mr. Grant was
the Co-Publisher, President
and General Manager of the Recorder and Times Limited, a newspaper publishing company, from July
1977 until July 1998.  He is currently thePresident of Kingmer Holding
Ltd.

**Jean-Louis Malouin**became a Director in November 1997. Dr. Malouin is a
Professor in the Faculty of
Administration at the University of Ottawa where he served as Dean between 1992 and 2000.  From 1989
to 1992, Dr. Malouin was the Dean of Administration at the University of Alberta and is a former dean at
the Université Laval.  He is an expert in  operations and production management, management information
systems design and research methodology.  He has served as a management consultant for numerous
organizations and institutions including the Canadian International Development Agency (CIDA), the
Université du Québec and the Ottawa Economic Development Corporation (OCEDCO).

**Hon. Barbara McDougall** became a Director in April 1998. Since February,
1999, Mrs. McDougall has
been President and Chief Executive Officer of the Canadian Institute of International Affairs. Prior to that
appointment, she was a private consultant on corporate governance and on international business. Mrs.
McDougall was also chairperson of the Board of Directors of AT&T Canada. Her current corporate
directorships include the Bank of Nova Scotia, Stelco Inc., and the Independent Order of Foresters. Prior to
1993, Mrs. McDougall was a Member of Parliament and Cabinet Minister in the Canadian Federal
Government.

**Lawrence O'Brien**became a director in August 2000. Mr. O'Brien founded
CALIAN Technology Ltd., a
consulting firm that sells information technology and professional services to industry and government
worldwide, in 1982. Mr. O'Brien retired as Chief Executive Officer of CALIAN Technology in May 2000
but remains the Chairman of the Board.

Under the Canada Business Corporations Act, a majority of the Board of Directors and a
majority of Board
Committee members must be resident Canadians. All directors hold office until the next annual meeting of
shareholders and until their successors have been elected. The executive officers of the Company serve at
the discretion of the Board of Directors of the Company. There are no family relationships among any of
the directors and executive officers of the Company.

The Audit Committee reviews the internal accounting procedures of the Company, consults
with and
reviews the services provided by the Company's independent auditors and is responsible for corporate
governance issues relating to the Company.

****The Compensation Committee
has a mandate to: (a) monitor compliance with provincial legislation
applicable in respect of employment practices of the Company, (b) determine the appropriate allocation of
stock options to eligible participants in the Corel Corporation Stock Option Plan, (c) determine Chief
Executive Officer and senior officer compensation, (d) monitor compliance with statutory requirements for
employment matters including remittances and legislation, and (e) review general policy matters relating to
employment and wage equity, compensation and benefits of employees of the Company generally. The
Committee met eight times in fiscal 2000 and acted by way of resolution on other occasions.

The Company has a policy of compensation based on merit and performance and does not
discriminate or
distinguish with respect to persons performing similar functions. Compensation in the Company, as
compared to industry surveys, is consistent with industry standards at the level necessary to attract and
retain qualified personnel.****

******************Item********11.****Executive Compensation**********

****The following table,
presented in CDN$, in accordance with the regulations of the Securities Act (Ontario),
sets forth all compensation paid in respect of the individuals who were, at November 30, 2000, the Chief
Executive Officer and the other four most highly compensated executive officers of the Company and three
former executive officers who were no longer with the company at November 30, 2000 but who otherwise
would have been included in the most highly compensated executive officers of the Company (the "named
executive officers").****

**SUMMARY COMPENSATION TABLE**

****

|                          |      |          |      |                                     |      |                  |      |                         |      | ****************Long-Term | ****              
|------------------------- | ---- | -------- | ---- | ----------------------------------- | ---- | ---------------- | ---- | ----------------------- | ---- | ------------------------- | ------------------
|                          |      |          |      | **************Annual Compensation** | **** | **Compensation** | ****
|                          |      |          |      |                                     |      |                  |      | **************Other**   | **** |                           | ******All**       
|****                      |      |          |      |                                     |      |                  |      | **************Annual**  | **** | **Securities**            | **Other**         
|**Name and Principal**    | **** |          |      |                                     |      |                  |      | **************Compen-** | **** | **Under Options**         | **Compen-**       
|**Position**              | **** | **Year** | **** | **Salary**                          | **** | **Bonus**        | **** | **sation (1)**          | **** | **Granted (#)**           | **sation**********
|**Derek J. Burney**       |      | 2000     |      | $293,077                            |      | Nil              |      | -                       |      | 225,000                   |                   
|President, and            |      | 1999     |      | 240,000                             |      | Nil              |      | -                       |      | 81,000                    |                   
|Chief Executive Officer   |      | 1998     |      | 158,753                             |      | $21,830          |      | -                       |      | 95,800                    |                   
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Steven Houck              |      | 2000     |      | 275,399                             |      | Nil              |      | -                       |      | 63,600                    | -                 
|Executive Vice President, |      | 1999     |      | 168,850                             |      | Nil              |      | -                       |      | 4,200                     | -                 
|Sales                     |      | 1998     |      | 133,085                             |      | Nil              |      | -                       |      | 3,500                     | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Annette McCleave          |      | 2000     |      | 167,500                             |      | Nil              |      | -                       |      | 54,700                    | -                 
|Executive Vice President, |      | 1999     |      | 139,699                             |      |                  |      | -                       |      | 16,000                    | -                 
|Corporate Marketing       |      | 1998     |      | 118,216                             |      |                  |      | -                       |      | 15,500                    | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Ian Legrow                |      | 2000     |      | 163,269                             |      | Nil              |      | -                       |      | 54,700                    | -                 
|Executive Vice President, |      | 1999     |      | 154,346                             |      |                  |      | -                       |      | 13,000                    | -                 
|Creative Products         |      | 1998     |      | 130,828                             |      |                  |      | -                       |      | 9,600                     | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Graham Brown              |      | 2000     |      | 163,269                             |      | Nil              |      | -                       |      | 54,700                    | -                 
|Executive Vice President, |      | 1999     |      | 155,471                             |      |                  |      | -                       |      | 16,000                    | -                 
|Business Applications     |      | 1998     |      | 135,309                             |      |                  |      | -                       |      | 15,500                    | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Michael C.J. Cowpland(2)  |      | 2000     |      | 166,269                             |      | Nil              |      | -                       |      | 341,100                   | -                 
|former Chairman,          |      | 1999     |      | 297,000                             |      | Nil              |      | -                       |      | 299,800                   | -                 
|President, and Chief      |      | 1998     |      | 296,481                             |      | Nil              |      | -                       |      | 275,000                   | -                 
|Executive Officer         |      |          |      |                                     |      |                  |      |                         |      |                           | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Kerry D. Williams  (2)    |      | 2000     |      | 221,601                             |      | Nil              |      | -                       |      | 28,400                    | 200,000 (3)       
|former Executive Vice     |      | 1999     |      | 198,000                             |      | Nil              |      | -                       |      | 67,900                    | -                 
|President, Manufacturing  |      | 1998     |      | 197,654                             |      | Nil              |      | -                       |      | 31,200                    | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|Carey Stanton   (2)       |      |          |      |                                     |      |                  |      |                         |      |                           |                   
|former Executive          |      | 2000     |      | 186,692                             |      | Nil              |      | -                       |      | 80,000                    | -                 
|Vice President, Business  |      | 1999     |      | 198,000                             |      | Nil              |      | -                       |      | 67,900                    | -                 
|Development               |      | 1998     |      | 197,653                             |      | Nil              |      | -                       |      | 81,200                    | -                 
|                          |      |          |      |                                     |      |                  |      |                         |      |                           |                   

Notes:

(1)    Perquisites and other personal benefits do not exceed the lesser of
CDN$50,000 and 10% of the
total of the annual salary and bonus for any of the named executive officers.

(2)    This additional disclosure includes individuals for whom disclosure
would have been provided as
part of the four most highly paid executive officers above but for the fact that the individuals were
not serving as  executive officers of the Company at the end of fiscal 2000.

(3)    This represents amounts paid, payable or accrued to the named
executive officer pursuant to an
arrangement in connection with the termination of such executive officer's employment with the
Company.****

****

The following table sets forth the stock
options granted under the Corel Corporation Stock Option Plan
2000 during the fiscal year ended November 30, 2000 to the named executive officers.****

**OPTION GRANTS FOR THE YEAR ENDED NOVEMBER 30,
2000**

**AND POTENTIAL REALIZABLE VALUE OF EACH GRANT OF
OPTIONS**

|                      |             |              |           |                    | Potential Realizable Value
at Assumed Annual Rates
of Stock Price
Appreciation for Option
Term

(CDN$)
|--------------------- | ----------- | ------------ | --------- | ------------------ | ------------------------------------------------------------------------------------------------------
|                      |             |              |           |                   
|                      | Number of   | % of total   | Exercise  |                   
|                      | Securities  | Options      | or base   |                   
|                      | underlying  | granted to   | Price     |                   
|                      | options     | employees in | ($/share) | Expiration        
|Name                  | granted (#) | fiscal year  | (CDN$)    | Date               | 5% ($)                                                                                                
|Michael C.J. Cowpland | 341,100     | 8.82%        | $  15.25  | September 15, 2000 | $  121,015                                                                                            
|Derek Burney          | 100,000     | 2.58%        | $  15.25  | March 30, 2004     | 328,647                                                                                               
|                      | 125,000     | 3.23%        | $  8.20   | October 5, 2004    | 220,893                                                                                               
|Graham Brown          | 19,700      | 0.51%        | $  15.25  | March 30, 2004     | 64,743                                                                                                
|                      | 35,000      | 0.90%        | $  8.20   | October 5, 2004    | 61,850                                                                                                
|Steve Houck           | 10,000      | 0.26%        | $20.62*   | January 17, 2004   | 44,437*                                                                                               
|                      | 18,600      | 0.48%        | $10.56*   | March 30, 2004     | 42,328                                                                                                
|                      | 35,000      | 0.90%        | $5.53*    | October 5, 2004    | 41,711                                                                                                
|Ian Legrow            | 19,700      | 0.51%        | $  15.25  | March 30, 2004     | 64,743                                                                                                
|                      | 35,000      | 0.90%        | $  8.20   | October 5, 2004    | 61,850                                                                                                
|Annette McCleave      | 19,700      | 0.51%        | $  15.25  | March 30, 2004     | 64,743                                                                                                
|                      | 35,000      | 0.90%        | $  8.20   | October 5, 2004    | 61,850                                                                                                
|Rene Schmidt          | 19,700      | 0.51%        | $  15.25  | March 30, 2004     | 64,743                                                                                                
|                      | 35,000      | 0.90%        | $  8.20   | October 5, 2004    | 61,850                                                                                                
|Kerry D. Williams     | 28,400      | 0.73%        | $  15.25  | December 31, 2000  | 93,335                                                                                                
|Carey Stanton         | 80,000      | 2.07%        | $  15.25  | July 21, 2001      | 262,917                                                                                               
|                      |             |              |           |                    |                                                                                                       

(*) Steve Houck's options and related information are listed in US$.



The following table sets forth each exercise of stock options under the Corel
Corporation Stock Option
Plan during the fiscal year ended November 30, 2000 by the named executive officers.

**AGGREGATED OPTION EXERCISES DURING THE FISCAL YEAR
ENDED**

**NOVEMBER 30, 2000 AND FISCAL YEAR-END OPTION
VALUES**

|                      |  |             |  |                    |  |               |  | Value of     
|--------------------- |  | ----------- |  | ------------------ |  | ------------- |  | -------------
|                      |  |             |  |                    |  |               |  | Unexercised  
|                      |  | Securities  |  |                    |  | Unexercised   |  | in-the-Money 
|                      |  | Acquired    |  | Aggregate Value    |  | Options at    |  | Options at   
|                      |  | on
Exercise |  | Realized           |  | Nov. 30, 2000 |  | Nov. 30, 2000
|Name                  |  | (#)         |  | (CDN$)             |  | (#)           |  | (CDN$)       
|Derek Burney          |  | -           |  | $                - |  | 247,809       |  | $     11,680 
|Steven Houck          |  | -           |  | -                  |  | 63,600        |  | -            
|Annette McCleave      |  | 8,267       |  | 189,457            |  | 59,700        |  | 3,650        
|Ian Legrow            |  | 3,000       |  | 78,205             |  | 70,700        |  | 11,680       
|Graham Brown          |  | -           |  | -                  |  | 56,700        |  | 1,460        
|Michael C.J. Cowpland |  | -           |  | -                  |  | 917,023       |  | 521,354      
|Kerry D. Williams     |  | -           |  | -                  |  | -             |  | -            
|Carey Stanton         |  | 20,264      |  | 94,007             |  | 80,000        |  | -            

All options are exercisable when granted.  The only exceptions are options granted
during an employee's
probationary period, usually six months in length. Those options that were repriced,as described in Note 9
to the consolidated financial statements (See Item*), and certain options recently granted which are
exercisable as to one-third on each of the date of original grant and the first and second anniversaries
thereof.

**Compensation of Directors**

Directors who are salaried officers of the Company receive no compensation for serving
on the Board of
Directors. The other directors (the "independent directors"), of whom there are currently six, receive an
annual retainer of CDN $16,000 (CDN $25,000 for Board Chair) and a fee of CDN $1,000 (CDN $2,000
for Board and Committee Chairs and Board Vice-Chair) for each Board of Directors and Committee
meeting they attend, and are reimbursed for traveling costs and other out-of-pocket expenses incurred in
attending such meetings. During the transition phase of the Company from August 15 to December 6,
2000, each non-employee director was also entitled to receive an hourly rate of CDN $250 for each hour
spent on the business of the Company outside of regularly scheduled meetings.

On August 15, 2000, a Deferred Share Units Plan ("DSP") for non-employee members of the
Board od
Directors was established by the Company . Under the DS, each director may elect to be paid up to 100%
of his or her compensation in deferred share units ("DSUs"). A DSU is credited by means of a
bookkeeping entry in the books of the Company to an account in the name of the director and payable only
at the end of his or her mandate on the Board of Directors, in cash or by way of Common Shares equal in
number to the DSUs credited to the director's account, based on the market value of the Common Shares at
that time. The number of DSUs credited to each director is determined on the basis of the portion elected
by each director of the amount payable to such director for the director's retainer and meeting fees for each
financial quarter, divided by the value of a DSU (which is equal to the closing price of the Common Shares
on The Toronto Stock Exchange ("TSE") on the third trading day after the announcement of the results for
such financial quarter). DSUs are credited with dividend equivalents when dividends are paid on Common
Shares and such dividend equivalents are converted into additional DSUs. Additional compensation
consisting of options for Common Shares mat be awarded to non-employee directors as the Board of
Directors deems appropriate.

The total compensation earned by non-employee directors in the financial year ending
November 30,2000
for duties performed during that fiscal year was CDN $ 300,625. As of February 26, 2001, a total of
23,155 Units have been credited to directors.

******Employment
Contracts and Termination of Employment and Change-in-Control Arrangements**

There are no clauses in the employment contracts for executives that are materially
different from those of
other employees in the Company.  Some of the items included in a standard employee contract are health
benefits, fitness benefits and company paid on-site parking; as well as non-competition and confidentiality
clauses.

****

**************Item 12.  Security Ownership of Certain Beneficial
Owners and Management**

The following table
sets forth, as of****February 21, 2001, certain information with respect to the beneficial
ownership of Common Shares by (1) each person known by the Company to be a beneficial owner of more
than 5% of its outstanding Common Shares, (2) by each director and named executive officer and (3) by all
directors and executive officers as a group.

|****Name
and Address of Beneficial Owner                    |  | **Common Shares
Beneficially
Owned** | **** | **Exercisable**

**Options**

**within 60 days** |  | ******Percentage
Owned (1)**
|----------------------------------------------------------- |  | ------------------------------------ | ---- | ------------------------------------------------ |  | ----------------------------
|                                                            |  |                                      |      |                                                  |  |                             
|Dr. Michael C.J. Cowpland(2)                                |  | 5,150,558                            |      | 1,646,176                                        |  | 9.2                         
|Lyle B. Blair                                               |  |                                      |      | 30,000                                           |  | *                           
|James C. Baillie                                            |  |                                      |      | 5,000                                            |  | *                           
|Hunter S. Grant                                             |  | 5,000                                |      | 37,852                                           |  | *                           
|Jean Louis Malouin                                          |  |                                      |      | 30,000                                           |  | *                           
|Barbara McDougall                                           |  |                                      |      | 30,000                                           |  | *                           
|Lawrence O'Brien                                            |  | 40,000                               |      | 5,000                                            |  | *                           
|John Blaine                                                 |  |                                      |      | 100,000                                          |  | *                           
|Derek Burney                                                |  |                                      |      | 247,809                                          |  | *                           
|Graham Brown                                                |  |                                      |      | 54,900                                           |  | *                           
|Steve Houck                                                 |  |                                      |      | 63,600                                           |  | *                           
|Ian Legrow                                                  |  |                                      |      | 75,888                                           |  | *                           
|Annette McCleave                                            |  |                                      |      | 62,985                                           |  | *                           
|Rene Schmidt                                                |  |                                      |      | 63,700                                           |  | *                           
|Directors and Executive Officers as a
group (13 persons)(3) |  | 5,196,458                            |      | 2,452,910                                        |  | 10.0                        

*     Indicates less than 1%

(1)     Percentage ownership is calculated using as a denominator the total number of
Common Share   outstanding plus the number of Common Shares to which the beneficial owner indicated has a
right to acquire pursuant to options currently exercisable or exercisable within 60 days.

(2)     Dr. Michael C.J. Cowpland resigned as President, Chief Executive Officer and
Chairman of the
Board of Directors on August 15, 2000. Dr. Cowpland resigned from the Board of Directors on
January 25, 2001.

(3)    The address for each director
and executive officer is Corel Corporation, 1600 Carling Avenue,
Ottawa, Ontario, Canada  K1Z 8R7.



Statements contained in the table as to securities beneficially owned by directors,
executive officers and
beneficial owners of more than 5% of the Company's outstanding Common Shares are, in each instance, based
upon information obtained from such directors and executive officers. Statements contained in the table as to
securities beneficially owned by beneficial owners of holders of 5% or more of the Company's outstanding
Common Shares are based on Schedules 13G or 13D filed by such persons with the U.S. Securities and
Exchange Commission.

**Item 13.  Certain Relationships and Related
Transactions**

Inapplicable pursuant to Instruction 3 to
Item 404 of Regulation S-K.

******PART
IV******

******Item 14.  Exhibits,
Financial Statement Schedules, and Reports on Form 8-K**

******(a)**The following documents are filed as a part of
this Annual Report on Form 10-K. ****

****

**1. Financial Statements**

The following financial statements and related reports thereon set forth on pages 23-42
of the 2000 Annual
Report to Shareholders is incorporated herein by reference and is filed herewith as Exhibit 13.2.****

- Management's Report;
- Auditors' Report;
- Consolidated Balance Sheets at November 30, 2000 and 1999;
- Consolidated Statements of Operations for the years ended November 30, 2000, 1999
and 1998;
- Consolidated Statements of Shareholders' Equity for the years ended November 30,
2000, 1999
and 1998;
- Consolidated Statements of Cash Flows for the years ended November 30, 2000, 1999
and 1998;
- Notes to Consolidated Financial Statements;****

**2. Financial Statement Schedule**

The following financial statement schedule and related auditors' report are filed as
part of this report
herewith as Exhibits 99.1 and  99.2:

Schedule II   Valuation and Qualifying Accounts for the years ended November 30,
2000, 1999 and
1998

****All other
schedules for which provision is made in the applicable accounting regulations of the Securities
and Exchange Commission are not required under the related instructions or are inapplicable and therefore
have been omitted.

**3. Exhibits**

| | Exhibit

Number | Description                                                                                                                                                                                                                                                                                
| | --------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 3.1             | Certificate and Articles of Incorporation (1)                                                                                                                                                                                                                                              
| | 3.2             | By-law No. 6 (1)                                                                                                                                                                                                                                                                           
| | 3.3             | Certificate and Articles of Amalgamation of Corel Corporation and Corel Computer Corp.
(1)                                                                                                                                                                                                 
| | 3.4             | Amendment to Articles of Incorporation (2)                                                                                                                                                                                                                                                 
| | 4.1             | Specimen of Common Share Certificate (1)                                                                                                                                                                                                                                                   
| | 4.2             | Shareholder Rights Plan Agreement dated February 11, 1999, as amended and restated as
of

March 31, 1999, by and between the Company and Montreal Trust Company of Canada,as
rights agent. (3)                                                                                             
| | 10.1            | Corel Corporation Stock Option Plan, as amended (4)                                                                                                                                                                                                                                        
| | 10.2            | Corel Corporation Stock Option Plan 2000 (4)                                                                                                                                                                                                                                               
| | 10.3            | Share Purchase Agreement dated September 18, 2000 by and between the Company
and

Albans Investments Limited (2)                                                                                                                                                                           
| | 10.4            | Registration Rights Agreement dated September 18, 2000 by and between the
Company

and Albans Investments Limited. (2)                                                                                                                                                                     
| | 10.5            | Escrow Agreement dated September 18, 2000 by and between the Company, Albans
Investments Limited and Epstein Becker & Green, P.C., as escrow agent. (2)                                                                                                                                    
| | 10.6            | Form of Share Purchase Warrant between the Company and each of Albans Investment
Limited, Whale Securities Co., L.P., and Richard Geyser. (2)                                                                                                                                              
| | 10.7            | Share Purchase Agreement dated October 2, 2000 by and between the Company and

Microsoft Corporation (5)                                                                                                                                                                                   
| | 10.8            | Registration Rights Agreement dated October 2, 2000 by and between the Company

and Microsoft Corporation (5)                                                                                                                                                                              
| | 10.9            | Technology and Services Agreement dated October 2, 2000 by and between the
Company

and Microsoft Corporation (5)                                                                                                                                                                          
| | 13.1            | Management's Discussion and Analysis of Financial Condition and Results of Operations
and
Financial Instruments. Quantitative and Qualitative Disclosures About Market Risk
(Incorporated by Reference to pages 13-21 of the 2000 Annual Report to Shareholders ("2000
Annual Report")) (2)
| | 13.2            | Financial Statements and related report thereon (Incorporated by Reference to

pages 23-42 of the 2000 Annual Report) (2)                                                                                                                                                                  
| | 21.1            | Subsidiaries of Registrant (2)                                                                                                                                                                                                                                                             
| | 23.1            | Consent of PricewaterhouseCoopers LLP Chartered Accountants (2)                                                                                                                                                                                                                            
| | 99.1            | Financial Statement Schedule - Schedule II - Valuation and Qualifying Accounts
for

the years ended November 30, 2000, 1999 and 1998 (2)                                                                                                                                                   
| | 99.2            | Auditors' Report to the Board of Directors on Financial Statement Schedules
(2)                                                                                                                                                                                                            

(1) Previously filed as an exhibit to the Company's Registration Statement No. 33-50886
and incorporated herein by
reference.

(2) Filed herewith

(3) Previously filed as an exhibit to the Company's Registration Statement No. 000-20562
and incorporated herein by
reference

(4) Previously filed as an exhibit to the Company's Registration Statement No. 333-42790
and incorporated herein by
reference

(5) Previously filed as an exhibit to the Current Report on Form 8-K dated October 2,
2000 and incorporated herein by
reference.

(b)  Reports on Form 8-K

During the three-month period ended November 30, 2000 the Company filed three Current
Reports on
Form 8-K including information requested under Item 5 and Item 7 as follows:



On September 12, 2000, the Company reported on the proposed consolidation of its
engineering
operations, based in Dublin, Ireland to its corporate headquarters in Ottawa, Canada.

On September 28, 2000, the Company reported that it had entered into a share purchase
agreement with an
institutional investor.

On October 11, 2000, the Company reported that it had entered into agreements with
Microsoft
Corporation whereby Microsoft Corporation would purchase 24 million non-voting, convertible Series A
preferred shares.

****(c) Exhibits



The response to this portion of Item 14 is submitted as a separate section of this
report.

(d) Financial Statement Schedules

The response to this portion of Item 14 is submitted as a separate section of this
report.

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, in the City of
Ottawa, Province of Ontario, Canada, on February 21, 2001.

| | COREL
CORPORATION
| | -----------------
| |                  
| | By               
| |                  
| |                  
| |                  



KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below
constitutes
and appoints Derek Burney and John Blaine, his or her Attorneys-in-fact, each with full power of substitution,
for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K, and to file
the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange
Commission, hereby ratifying and confirming all that each said Attorney-in-fact, or his or her substitute or
substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has
been signed below by the
following persons on behalf of the registrant in the capacities indicated on February 21, 2001.

|Signature                |  | Title                                          
|------------------------ |  | -----------------------------------------------
|                         |  |                                                
|*/s/ James Baillie*      |  | Chairman of the Board                          
|James Baillie            |  |                                                
|                         |  |                                                
|***/s/ Derek J. Burney*  |  | President and Chief Executive Officer, Director
|Derek J. Burney          |  |                                                
|                         |  |                                                
|*/s/ Lyle B. Blair*      |  | Director                                       
|Lyle B. Blair            |  |                                                
|                         |  |                                                
|*/s/ Hunter S. Grant*    |  | Director                                       
|Hunter S. Grant          |  |                                                
|                         |  |                                                
|*/s/ Jean-Louis Malouin* |  | Director                                       
|Jean-Louis Malouin       |  |                                                
|                         |  |                                                
|*/s/ Barbara McDougall*  |  | Director                                       
|Barbara McDougall        |  |                                                
|                         |  |                                                
|*/s/ Lawrence O'Brien*   |  | Director                                       
|Lawrence O'Brien         |  |                                                
|                         |  |                                                
|/s/ John Blaine          |  | Chief Financial Officer and                    
|John Blaine              |  | Executive Vice President, Finance              
|                         |  | (principal
financial and accounting officer)   

****

******Schedule II - 1**

**Index to Exhibits**

|****Exhibit

Number | Description                                                                                                                                                                                                                                                                                
|------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3
 .1               | Certificate and Articles of Incorporation (1)                                                                                                                                                                                                                                              
|3.2                 | By-law No. 6 (1)                                                                                                                                                                                                                                                                           
|3.3                 | Certificate and Articles of Amalgamation of Corel Corporation and Corel Computer Corp.
(1)                                                                                                                                                                                                 
|3.4                 | Amendment to Articles of Incorporation (2)                                                                                                                                                                                                                                                 
|4.1                 | Specimen of Common Share Certificate (1)                                                                                                                                                                                                                                                   
|4.2                 | Shareholder Rights Plan Agreement dated February 11, 1999, as amended and restated as
of

March 31, 1999, by and between the Company and Montreal Trust Company of Canada,as
rights agent. (3)                                                                                             
|10.1                | Corel Corporation Stock Option Plan, as amended (4)                                                                                                                                                                                                                                        
|10.2                | Corel Corporation Stock Option Plan 2000 (4)                                                                                                                                                                                                                                               
|10.3                | Share Purchase Agreement dated September 18, 2000 by and between the Company
and

Albans Investments Limited (2)                                                                                                                                                                           
|10.4                | Registration Rights Agreement dated September 18, 2000 by and between the
Company

and Albans Investments Limited. (2)                                                                                                                                                                     
|10.5                | Escrow Agreement dated September 18, 2000 by and between the Company, Albans
Investments Limited and Epstein Becker & Green, P.C., as escrow agent. (2)                                                                                                                                    
|10.6                | Form of Share Purchase Warrant between the Company and each of Albans Investment
Limited, Whale Securities Co., L.P., and Richard Geyser. (2)                                                                                                                                              
|10.7                | Share Purchase Agreement dated October 2, 2000 by and between the Company and

Microsoft Corporation (5)                                                                                                                                                                                   
|10.8                | Registration Rights Agreement dated October 2, 2000 by and between the Company

and Microsoft Corporation (5)                                                                                                                                                                              
|10.9                | Technology and Services Agreement dated October 2, 2000 by and between the
Company

and Microsoft Corporation (5)                                                                                                                                                                          
|13.1                | Management's Discussion and Analysis of Financial Condition and Results of Operations
and
Financial Instruments. Quantitative and Qualitative Disclosures About Market Risk
(Incorporated by Reference to pages 13-21 of the 2000 Annual Report to Shareholders ("2000
Annual Report")) (2)
|13.2                | Financial Statements and related report thereon (Incorporated by Reference to

pages 23-42 of the 2000 Annual Report) (2)                                                                                                                                                                  
|21.1                | Subsidiaries of Registrant (2)                                                                                                                                                                                                                                                             
|23.1                | Consent of PricewaterhouseCoopers LLP Chartered Accountants (2)                                                                                                                                                                                                                            
|99.1                | Financial Statement Schedule - Schedule II - Valuation and Qualifying Accounts
for

the years ended November 30, 2000, 1999 and 1998 (2)                                                                                                                                                   
|99.2                | Auditors' Report to the Board of Directors on Financial Statement Schedules
(2)