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Nortel Obtains U.S. and Canadian Court Approval for Sale to GENBAND of its Carrier VoIP and Application Solutions Business

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Posted March 4, 2010

Nortel Obtains U.S. and Canadian Court Approval for Sale to GENBAND of its Carrier VoIP and Application Solutions Business
March 3, 2010

TORONTO - Nortel* Networks Corporation [OTC: NRTLQ] announced that at a joint hearing today it, its principal operating subsidiary Nortel Networks Limited (NNL), and certain of its other subsidiaries including Nortel Networks Inc. (NNI) obtained orders from the United States Bankruptcy Court for the District of Delaware and the Ontario Superior Court of Justice approving the asset sale agreement with GENBAND, Inc. (GENBAND)  for the sale of substantially all of the global assets of Nortel's Carrier VoIP and Application Solutions (CVAS) business. Certain other Nortel subsidiaries, including Nortel Networks U.K. Limited (in administration), have entered into a separate asset sale agreement with GENBAND for the Europe, Middle East and Africa portion of Nortel's CVAS business. Under the agreements, GENBAND will pay an aggregate purchase price of US$282, subject to balance sheet and other adjustments currently estimated at approximately US$100 million for a net purchase price of approximately US$182 million.

As announced on February 24, 2010, GENBAND's purchase will include substantially all product platforms, all patents predominantly used, and other IP exclusively used in Nortel's CVAS business, including softswitching, gateways, SIP applications, and TDM products and services. The agreements will also provide for the transition of substantially all of Nortel's CVAS customer contracts to GENBAND. Nortel will work diligently with GENBAND to close the sale in the second quarter of 2010, subject to the timing of regulatory approvals. The sale is subject to court approval in Israel and certain regulatory approvals, information and consultation with employee representatives and/or employees in certain EMEA jurisdictions, other customary closing conditions and certain post-closing purchase price adjustments.

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