Corel is to slash its workforce by about 21 per cent to reduce operating costs, as part of a plan for the company to cut costs by US$40 million.

Three hundred and twenty jobs will be lost worldwide, the bulk of these from Corel’s headquarters in Ottowa. The cuts will be across the board, and will consist of: "employee terminations, termination of contractors and attrition," said a spokeswoman.

Corel CEO and president, Michael Cowpland (pictured), will forego his salary for an unspecified period as part of the cost-cutting efforts. His salary was $199,000 last year, Corel revealed.

"This was not an easy decision to make," Cowpland said in a Corel statement issued today. "After much careful deliberation, the company concluded that these steps were necessary."

Quiet on cash Corel is in a quiet period preluding the release of its second-quarter financial results, due to appear during the week of June 19. This effectively means that Corel is barred from making any in-depth comments about its cost savings plan.

Late last month, Corel announced some much-needed extra financing with a $9.98 million agreement with Canaccord Capital, at the same time two senior Corel executives left the company.

In April, Corel told the US Securities and Exchange Commission (SEC) that it would run out of cash in 90 days if its planned merger with Inprise/Borland didn’t proceed. The merger failed, and Corel’s future looked uncertain.

Corel's stock closed today on the Nasdaq exchange at $5.03, down 4.2 per cent on yesterday's end of trading.