SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 14, 2003
AVAYA INC.
(Exact name of registrant as specified in its charter)
Delaware 1-15951 22-3713430
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
211 Mount Airy Road 07920
Basking Ridge, NJ (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (908) 953-6000
ITEM 9. REGULATION FD DISCLOSURE
On March 14, 2003, Avaya Inc., a Delaware corporation ("Avaya" or the
"Company"), entered into restructured agreements with Expanets, Inc., a Delaware
corporation ("Expanets"), and its parent company, NorthWestern Corporation, a
Delaware corporation ("NorthWestern"), regarding resolution of certain operating
issues and customer data and billing management services related to the March
2000 sale to Expanets of Avaya's primary distribution function for voice systems
for U.S. small and mid-sized businesses. In exchange for the companies providing
mutual general releases of liability concerning outstanding operational issues,
the parties' agreements include the following:
o Avaya has canceled the notes receivable and will surrender the
preferred equity interests delivered to Avaya by Expanets in March
2000 in partial payment of the purchase price for the sale of the
distribution function to Expanets. Primarily because the notes were
by their terms subordinated to Expanets' senior debt and collection
of the notes was unlikely, and the preferred equity was junior to
Expanets' senior debt, the notes and Expanets' other series of
preferred stock, no value was ascribed to the notes or the preferred
equity in the Company's financial statements at the time of the sale.
Accordingly, the Company will not record a charge related to the
cancellation of the debt and equity interests.
o Avaya has agreed to extend the payment term of approximately $27
million owed to Avaya by Expanets under a credit agreement, originally
due on December 31, 2002, which will now be repaid in three equal
installments on January 1, April 1 and July 1, 2004. Expanets will
continue to pay interest on the credit facility on a monthly basis. No
further borrowings may be made under this facility. If Expanets
defaults under this facility, Avaya retains the right to require
NorthWestern to purchase inventory and accounts from Avaya in an
amount equal to the outstanding balance of the facility at the time of
default. The credit facility also provides that a default by
NorthWestern of its obligations under the facility could, at Avaya's
election, be declared a default under the Expanets dealer agreement
with Avaya, resulting in a termination of certain non-competition
provisions contained in such agreement and permitting Avaya to
sell products and services to certain of Expanets' customers.
o Expanets and Avaya have revised their agreement in which Avaya will
provide services support for Expanets' customers through the Expanets
Technical Assistance Center.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AVAYA INC.
Date: March 19, 2003 By: /s/ PAMELA F. CRAVEN
---------------------------------
Name: Pamela F. Craven
Title: Senior Vice President,
General Counsel and Secretary
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