Nortel Announces Unsuccessful Conclusion of Mediation Proceedings
TORONTO, ONTARIO -- (Marketwire) -- 01/24/13 -- Nortel(i) Networks Corporation (OTCBB:NRTLQ) and Nortel Networks Limited announced today that the mediation proceedings that had been commenced in respect of the allocation of sale proceeds of Nortel's various business and asset divestitures and other inter-estate matters, including inter-company claims, have been terminated by the court-appointed mediator. As previously announced, the courts overseeing Nortel's creditor protection proceedings in Canada and the United States directed the Nortel entities that are in creditor protection proceedings in Canada, the U.S., and Europe, the Middle East and Africa, as well as certain other interested parties, to participate in a joint mediation of the afore-mentioned matters and appointed the Hon. Warren K. Winkler, Chief Justice of Ontario, as the sole mediator for the mediation. Following the holding of an all-party mediation session, which began on January 14, 2013 and ended on January 22, 2013 without any agreement having been reached on the matters in dispute, the mediator announced on January 24, 2013 his decision to terminate the mediation based on his conclusion that further efforts at mediation are no longer worthwhile.
In light of the unsuccessful conclusion of this mediation process, which follows two previous failed attempts at achieving a mediated solution, both the process for and timing of the ultimate resolution of allocation and inter-company claims matters remains uncertain and further delays in the resolution of these matters potentially could be significant. Such delays would result in a corresponding significant delay in the timing of distributions to holders of validated claims of the various estates.
For more information, please visit Nortel Networks Corporation's website at www.nortel-canada.com.
Certain statements in this press release may contain words such as "could", "expects", "may", "should", "will", "anticipates", "believes", "intends", "estimates", "targets", "plans", "envisions", "seeks" and other similar language and are considered forward-looking statements or information under applicable securities laws. These statements are based on Nortel's current expectations, estimates, forecasts and projections about the operating environment, economies and markets in which Nortel operates. These statements are subject to important assumptions, risks and uncertainties that are difficult to predict, and the actual outcome may be materially different. Nortel's assumptions, although considered reasonable by Nortel at the date of this press release, may prove to be inaccurate and consequently Nortel's actual results could differ materially from the expectations set out herein.
Actual results or events could differ materially from those contemplated in forward-looking statements as a result of the following: (i) risks and uncertainties relating to the Creditor Protection Proceedings including: (a) risks associated with Nortel's ability to: obtain required approvals and successfully consummate remaining divestitures; successfully conclude ongoing discussions for the sale of Nortel's remaining assets; develop, obtain required approvals for, and implement a court approved plan; allocation of the sale proceeds of our businesses and assets among the various Nortel entities participating in these sales may take considerable time to resolve; resolve ongoing issues with creditors and other third parties whose interests may differ from Nortel's; maintain adequate cash on hand in each of its jurisdictions to fund remaining work within the jurisdiction during the Creditor Protection Proceedings; obtain any further required approvals from the Canadian Monitor, the U.K. Administrators, the U.S. Principal Officer, the U.S. Creditors' Committee, or other third parties; utilize net operating loss carryforwards and certain other tax attributes in the future; avoid the substantive consolidation of NNI's assets and liabilities with those of one or more other U.S. Debtors; operate effectively, and in consultation with the Canadian Monitor, the Canadian creditors' committee, the U.S. Creditors' Committee, the U.S. Principal Officer, and work effectively with the U.K. Administrators and French Administrator in their respective administration of the EMEA businesses subject to the Creditor Protection Proceedings; continue as a going concern; actively and adequately communicate on and respond to events, media and rumors associated with the Creditor Protection Proceedings; retain and incentivize key employees as may be needed; retain, or if necessary, obtain court orders or approvals with respect to motions filed from time to time; resolve claims made against Nortel in connection with the Creditor Protection Proceedings for amounts not exceeding Nortel's recorded liabilities subject to compromise; prevent third parties from obtaining court orders or approvals that are contrary to Nortel's interests; resolve disputes regarding the allocation of sale proceeds of Nortel's various business and asset divestitures and other inter-estate matters, including inter-company claims; and
(b) risks and uncertainties associated with: limitations on actions against any Debtor during the Creditor Protection Proceedings; the values, if any, that will be prescribed pursuant to any court approved plan to outstanding Nortel securities and, in particular, that Nortel does not expect that any value will be prescribed to the NNC common shares or the NNL preferred shares in any such plan; the delisting of NNC common shares from the NYSE; the delisting of NNC common shares and NNL preferred shares from the TSX; the discontinuance of preparing and filing NNC and NNL's quarterly and annual financial statements and related filings under Canadian and/or U.S. securities laws; and the cease trade orders that have been issued by certain of the Canadian Securities Administrators to prohibit trading in securities of NNC and NNL (subject to certain limited exceptions) by reason of NNC and NNL's failure to file their respective financial statements and related disclosure filings for the third quarter of 2012 by the required filing deadlines; and (ii) risks and uncertainties relating to Nortel's remaining restructuring work including fluctuations in foreign currency exchange rates; the sufficiency of workforce and cost reduction initiatives; any adverse legal judgments, fines, penalties or settlements related to any significant pending or future litigation actions; failure to maintain integrity of Nortel's information systems; and Nortel's potential inability to maintain an effective risk management strategy.
For additional information with respect to certain of these and other factors, see Nortel's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other securities filings with the SEC. Unless otherwise required by applicable securities laws, Nortel disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
(i)Nortel, the Nortel logo and the Globemark are trademarks of Nortel Networks.