SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D/A
(RULE 13d-101)
(Amendment No. 6)
ARRIS Group, Inc.
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(Name of Issuer)
Common Stock, $.01 par value per share
--------------------------------------
(Title of Class of Securities)
04269Q100
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(CUSIP Number)
Deborah J. Noble
Corporate Secretary
Nortel Networks Corporation
8200 Dixie Road, Suite 100
Brampton, Ontario L6T 5P6
Canada
(905) 863-1103
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
March 24, 2003
--------------
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box: |_|
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7 for other parties
to whom copies are to be sent.
The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter the
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 (the "Act") or otherwise subject to the liabilities of that section of the
Act but shall be subject to all other provisions of the Act (however, see the
Notes).
(Page 1 of 23 Pages)
CUSIP NO. 04269Q100 Page 2 of 23 Pages
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1. NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Nortel Networks Corporation
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
(b)
Not Applicable
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
OO
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS
2(d) or 2(e) |_|
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Canada
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NUMBER OF SHARES 7. SOLE VOTING POWER
BENEFICIALLY OWNED BY EACH
REPORTING PERSON WITH 14,000,000 shares
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8. SHARED VOTING POWER
0 shares
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9. SOLE DISPOSITIVE POWER
14,000,000 shares
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10. SHARED DISPOSITIVE POWER
0 shares
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11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
14,000,000 shares
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12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
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13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
18.8%
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14. TYPE OF REPORTING PERSON
CO
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
CUSIP NO. 04269Q100 Page 3 of 23 Pages
AMENDMENT NO. 6
TO
SCHEDULE 13D
This Amendment No. 6 amends and restates in its entirety the
Statement on Schedule 13D filed on August 13, 2001, by and on behalf of Nortel
Networks Corporation with respect to its beneficial ownership of common stock,
par value $.01 per share ("Arris Group Common Stock"), of Arris Group, Inc.
(f/k/a Broadband Parent Corporation), a Delaware corporation ("Arris Group"), as
amended by Amendment No. 1 to Schedule 13D filed on June 11, 2002, Amendment No.
2 to Schedule 13D filed on June 21, 2002, Amendment No. 3 to Schedule 13D filed
on June 25, 2002, Amendment No. 4 to Schedule 13D filed on March 13, 2003 and
Amendment No. 5 to Schedule 13D filed on March 19, 2003 (as amended, the
"Statement"). The Statement, as amended and restated by this Amendment No. 6, is
referred to herein as "Schedule 13D."
Item 1. Security and Issuer.
-------------------
This Schedule 13D relates to Arris Group Common Stock. The principal
executive offices of Arris Group are located at 11450 Technology Circle, Duluth,
Georgia 30097.
The 14,000,000 shares of Arris Group Common Stock beneficially owned
by Nortel Networks Corporation are held of record by Nortel Networks Inc., a
Delaware corporation and successor in interest to Nortel Networks LLC, a
Delaware limited liability company which, as of December 31, 2002, merged with
and into Nortel Networks Inc. Nortel Networks Inc. in turn is a wholly owned
subsidiary of Nortel Networks Limited, a Canadian corporation and a wholly owned
subsidiary of Nortel Networks Corporation, a Canadian corporation. Nortel
Networks Corporation and the above referenced affiliates are sometimes
collectively referred to herein as "Nortel Networks."
Item 2. Identity and Background.
-----------------------
This Schedule 13D is being filed by Nortel Networks Corporation. The
principal executive offices of Nortel Networks Corporation are located at 8200
Dixie Road, Suite 100, Brampton, Ontario L6T 5P6, Canada. Nortel Networks
Corporation is an industry leader and innovator focused on transforming how the
world communicates and exchanges information. It supplies products and services
that support the Internet and other public and private data, voice and
multimedia communications networks using wireline and wireless technologies,
which it refers to as "networking solutions." Its business consists of the
design, development, manufacture, assembly, marketing, sale, licensing,
installation, servicing and support of these networking solutions.
(a) - (c); (f) The name, business address, present principal
occupation or employment, and the name and principal business of any corporation
or other organization in which such employment is conducted, of each of the
directors, executive officers and certain non-executive board-appointed officers
of Nortel Networks Corporation, Nortel Networks
CUSIP NO. 04269Q100 Page 4 of 23 Pages
Limited and Nortel Networks Inc. are set forth in Schedule I hereto, which is
incorporated herein by reference. The citizenship of each person listed in
Schedule I is indicated thereon.
(d) - (e) During the last five years, neither Nortel Networks
Corporation nor, to the knowledge of Nortel Networks Corporation, any of the
persons listed on Schedule I hereto (i) has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (ii) has
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, Federal or State securities laws or finding
any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
On August 3, 2001, Nortel Networks LLC acquired 37,000,000 shares of
Arris Group Common Stock in exchange for, among other consideration, its then
existing membership interest in Arris Interactive L.L.C. ("Arris LLC"), a
Delaware limited liability company and a joint venture of Nortel Networks LLC
and Arris International, Inc. (f/k/a ANTEC Corporation), a Delaware corporation
("ANTEC"). As of December 31, 2002, Nortel Networks LLC was merged with and into
Nortel Networks Inc. Accordingly, all shares of Arris Group Common Stock
currently held by Nortel Networks are held of record by Nortel Networks Inc.
Item 4. Purpose of Transaction.
----------------------
ANTEC, Arris Group, Broadband Transition Corporation, a Delaware
corporation and wholly owned subsidiary of Arris Group, Nortel Networks Inc.,
Nortel Networks LLC and Arris LLC entered into an Agreement and Plan of
Reorganization, dated as of October 18, 2000 (the "Original Agreement"), as
amended as of April 9, 2001 (the "Amended Agreement" and, together with the
Original Agreement, the "Reorganization Agreement"). A copy of the Original
Agreement is filed as Exhibit 2 to the Statement and incorporated herein by
reference, and a copy of the Amended Agreement is filed as Exhibit 3 to the
Statement and incorporated herein by reference. On August 3, 2001, pursuant to
the Reorganization Agreement, Nortel Networks LLC exchanged its existing
membership interest in Arris LLC for, among other things, 37,000,000 shares of
Arris Group Common Stock. In addition, on August 3, 2001, Nortel Networks LLC,
ANTEC and Arris Group entered into a second amended and restated limited
liability company operating agreement for Arris LLC (the "Arris LLC Operating
Agreement") pursuant to which Nortel Networks LLC received a new membership
interest in Arris LLC (the "New Membership Interest") with a face amount of
$100,000,000. A copy of the Arris LLC Operating Agreement is filed as Exhibit 1
to the Statement and incorporated herein by reference.
On June 15, 2001, Nortel Networks Corporation announced its decision
to discontinue its access solutions business operations, which includes its
ownership interest in Arris Group. As of March 24, 2003, Nortel Networks had
sold 23,000,000 shares of its original 37,000,000 shares of Arris Group Common
Stock as more fully described in this Schedule 13D.
On May 16, 2002, Arris Group filed a registration statement on Form
S-3 (Registration No. 333-88498) (the "Preliminary Registration Statement") with
respect to the sale by Nortel Networks of up to 21,000,000 shares of Arris Group
Common Stock as a result of the
CUSIP NO. 04269Q100 Page 5 of 23 Pages
exercise of certain demand registration rights as described in Item 6 of this
Schedule 13D, which is incorporated herein by reference. On June 7, 2002, Arris
Group filed an amendment to the Preliminary Registration Statement (together
with the Preliminary Registration Statement, "S-3 Registration Statement") to,
among other things, describe the terms of the Investor Rights Agreement, the
Lock-Up Agreement and the Option Agreement (each, as defined below). The S-3
Registration Statement was declared effective by the Securities and Exchange
Commission on June 7, 2002. On June 10, 2002, Arris Group filed a prospectus
supplement (the "Prospectus Supplement") pursuant to Rule 424(b) of the
Securities Act of 1933, as amended (the "Securities Act"), in connection with a
firm commitment underwritten public offering of 15,000,000 shares of Arris Group
Common Stock (plus an option to purchase up to 2,250,000 shares of Arris Group
Common Stock to cover over-allotments) registered pursuant to the S-3
Registration Statement.
On June 7, 2002, Nortel Networks LLC, Arris LLC and Arris Group
entered into an Option Agreement (the "Option Agreement") that entitled Arris
LLC to redeem Nortel Networks' New Membership Interest in Arris LLC at a
discount of up to 40% as a result of Nortel Networks' sale of shares of Arris
Group Common Stock in a firm commitment underwritten public offering pursuant to
the S-3 Registration Statement on or before June 30, 2002. The amount of the
discount correlated to the percentage of shares of Arris Group Common Stock that
Nortel Networks owned as of June 30, 2002. Based upon the percentage of shares
of Arris Group Common Stock that Nortel Networks owned as of June 30, 2002, the
discount percentage was equal to 21%.
On June 19, 2002, Nortel Networks LLC, Arris Group, and CIBC World
Markets Corp. ("CIBC") and J.P. Morgan Securities Inc. ("J.P. Morgan"), as
representatives of the several underwriters, entered into an Underwriting
Agreement (the "Underwriting Agreement") pursuant to which Nortel Networks LLC
agreed to sell 15,000,000 shares of Arris Group Common Stock to the underwriters
and granted the underwriters an over-allotment option with respect to an
additional 2,250,000 shares of Arris Group Common Stock (the "Offering"). On
June 25, 2002, Nortel Networks consummated the sale to the Underwriters of a
total of 15,000,000 shares of Arris Group Common Stock. The shares of Arris
Group Common Stock were sold to the public at a price of $4.71 per share, and
Nortel Networks received proceeds of $4.4745 per share, or an aggregate of
$67,117,500.
On March 11, 2003, Nortel Networks Inc., Arris Group and Arris LLC
entered into a Stock Option Agreement (the "Stock Option Agreement") pursuant to
which Nortel Networks Inc., as the successor in interest to Nortel Networks LLC,
granted to Arris Group, for consideration of $1.00, an option (the "Stock
Option") to purchase in cash, from time to time (but in no event on more than
four occasions and in each event for at least 1,000,000 shares of Arris Group
Common Stock) up to an aggregate of 16,000,000 shares of Arris Group Common
Stock. The exercise price per share of the Stock Option will be equal to 90% of
either: (i) in the event that the exercise occurs within seven calendar days of
the closing of the Note Offering (as defined below), the closing price on the
Nasdaq National Market System for shares of Arris Group Common Stock on the date
that the Note Offering is priced; and (ii) otherwise, the five trading day
weighted average price of the shares of Arris Group Common Stock immediately
preceding the date of exercise. The Stock Option Agreement provides that,
notwithstanding the foregoing, the exercise price shall not be less than $4.00
per share of Arris Group Common Stock, except that with respect to 8,000,000
shares of Arris Group Common Stock the exercise
CUSIP NO. 04269Q100 Page 6 of 23 Pages
price may be less than $4.00 per share of Arris Group Common Stock but not less
than $3.50 per share of Arris Group Common Stock, provided that to the extent
that the exercise price for any shares is between $3.50 and $4.00 per share,
there shall be a reduction in the forgiveness of the Class B Return (as defined
in the Arris LLC Operating Agreement) equal to 50% of the amount by which the
aggregate exercise price for all exercises is less than $4.00 per share of Arris
Group Common Stock (the "Class B Reduction").
On March 11, 2003, Nortel Networks Inc. and CIBC entered into a
Master Securities Loan Agreement (the "Master Securities Loan Agreement")
pursuant to which CIBC may from time to time borrow up to 6,000,000 shares of
Arris Group Common Stock from Nortel Networks Inc. subject to certain
restrictions and with the agreement of Nortel Networks Inc. Such shares may be
offered directly to one or more purchasers of convertible subordinated notes of
Arris Group (the "Convertible Notes") sold in connection with Arris Group's
March 2003 private placement of 4 1/2% convertible subordinated notes due 2008
(the "Note Offering") at negotiated prices, at market prices prevailing at the
time of sale of the shares of Arris Group Common Stock or at prices related to
such market prices, in connection with CIBC's market-making activities.
On March 12, 2003, pursuant to Rule 424(b)(3) of the Securities Act,
Arris Group filed a prospectus supplement (the "March Prospectus Supplement")
relating to 6,000,000 shares of Arris Group Common Stock not previously sold
under the S-3 Registration Statement. The March Prospectus Supplement was filed
in connection with Nortel Networks' loan of up to 6,000,000 shares of Arris
Group Common Stock to CIBC in accordance with the terms of the Master Securities
Loan Agreement.
On March 18, 2003, pursuant to the terms of the Option Agreement, as
amended by the Stock Option Agreement, Nortel Networks Inc., as the successor in
interest to Nortel Networks LLC, assigned in full its New Membership Interest to
ANTEC for an aggregate consideration of $86,430,388.89. Such amount represented
a 21% discount on the New Membership Interest and included forgiveness of a
portion of the Class B Return equal to $7,500,000 (i.e., the net amount of this
forgiveness after the 21% discount provided for in the Option Agreement was
$5,925,000). As a result of the assignment of the New Membership Interest,
Nortel Networks no longer has a membership interest in Arris LLC and is no
longer bound by the terms of the Arris LLC Operating Agreement.
On March 20, 2003, in accordance with the terms of the Stock Option
Agreement, Arris Group exercised the Stock Option for 8,000,000 shares of Arris
Group Common Stock at an exercise price per share equal to $3.50. On March 24,
2003, Nortel Networks Inc. consummated the sale of 8,000,000 shares of Arris
Group Common Stock to Arris Group for an aggregate consideration of $28,000,000.
Pursuant to the terms of the Stock Option Agreement, there was also a reduction
in the forgiveness of the Class B Return equal to 50% of the product of (a) the
difference between $4.00 per share and the exercise price per share ($3.50),
multiplied by (b) the number of shares of Arris Group Common Stock acquired upon
exercise (8,000,000). Accordingly, the amount of this forgiveness was reduced by
$2,000,000, which amount was wired to Nortel Networks on March 24, 2003.
CUSIP NO. 04269Q100 Page 7 of 23 Pages
Except as set forth in this Schedule 13D, the Reorganization
Agreement, the Arris LLC Operating Agreement, the S-3 Registration Statement,
the Prospectus Supplement, the Option Agreement, the Underwriting Agreement, the
Stock Option Agreement, the Master Securities Loan Agreement and the March
Prospectus Supplement, neither Nortel Networks Corporation nor, to the best of
Nortel Networks Corporation's knowledge, any of the individuals named in
Schedule I hereto has any plans or proposals which related to or which would
result in or relate to any of the actions specified in subparagraphs (a) through
(j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
------------------------------------
(a) Nortel Networks Corporation is the beneficial owner of
14,000,000 shares of Arris Group Common Stock, representing approximately 18.8%
of the Arris Group Common Stock issued and outstanding.
Except as set forth in this Item 5, neither Nortel Networks
Corporation nor, to the best of Nortel Networks Corporation's knowledge, any of
the individuals named in Schedule I hereto beneficially owns any shares of Arris
Group Common Stock.
(b) Nortel Networks Corporation has the sole power to vote or to
direct the vote and sole power to dispose or direct the disposition of the
14,000,000 shares of Arris Group Common Stock.
(c) Except as described in this Schedule 13D, neither Nortel
Networks Corporation, nor to the best of Nortel Networks Corporation's
knowledge, any of the individuals named in Schedule I hereto has effected any
transaction in Arris Group Common Stock during the past 60 days.
(d) Nortel Networks Corporation holds all rights associated with the
14,000,000 shares of Arris Group Common Stock, including the right to receive
dividends on such stock.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of Arris Group.
-------------------------------------------------------------
THE REORGANIZATION AGREEMENT. A copy of the Original Agreement is
filed as Exhibit 2 to the Statement and incorporated herein by reference, and a
copy of the Amended Agreement is filed as Exhibit 3 to the Statement and
incorporated herein by reference. Pursuant to the Reorganization Agreement,
Nortel Networks LLC exchanged its existing membership interest in Arris LLC for,
among other things, 37,000,000 shares of Arris Group Common Stock.
REGISTRATION RIGHTS AGREEMENT. On August 3, 2001, Arris Group and
Nortel Networks LLC entered into a Registration Rights Agreement (the
"Registration Rights Agreement"), which sets forth the following registration
rights and limitations regarding the Arris Group Common Stock: (a) Nortel
Networks may require Arris Group to initiate a public offering for any shares
requested to be sold by Nortel Networks, provided that the number of shares
requested to be sold by Nortel Networks is equal to at least 5% of the then
outstanding
CUSIP NO. 04269Q100 Page 8 of 23 Pages
shares of Arris Group Common Stock and provided further that Arris Group is not
required to effect more than three registrations on Form S-1; (b) Nortel
Networks may not exercise its rights to request a registration more than once
during any 90-day period; (c) Nortel Networks has the right to participate in
and sell shares of stock held by it during any public offering of Arris Group
stock, whether offered by Arris Group or any other stockholder; and (d) Arris
Group will pay for Nortel Networks' expenses relating to its participation in a
public offering, whether or not the offering is initiated by Nortel Networks. A
copy of the Registration Rights Agreement is filed as Exhibit 4 to the Statement
and incorporated herein by reference. Please see "Registration Rights Letter
Agreement" below for a description of amendments to the Registration Rights
Agreement.
ARRIS LLC OPERATING AGREEMENT. Pursuant to the terms of the Option
Agreement, as amended by the Stock Option Agreement, Nortel Networks Inc.
assigned in full its New Membership Interest to ANTEC for an aggregate
consideration of $86,430,388.89. As a result, Nortel Networks no longer has a
membership interest in Arris LLC and is no longer bound by the terms of the
Arris LLC Operating Agreement, which is filed as Exhibit 1 to the Statement and
incorporated herein by reference.
THE INVESTOR RIGHTS AGREEMENT. On June 7, 2002, Nortel Networks LLC,
Nortel Networks Inc. and Arris Group entered into a Second Amended and Restated
Investor Rights (the "Investor Rights Agreement"), which amends and restates in
its entirety that certain Amended and Restated Investor Rights Agreement, dated
as of April 9, 2001, by and among Nortel Networks LLC, Nortel Networks Inc. and
Arris Group, as amended by First Amendment to Amended and Restated Investor
Rights Agreement dated as of August 3, 2001. A copy of the Investor Rights
Agreement is filed as Exhibit 5 to the Statement and incorporated herein by
reference.
Directors; Voting of Shares.
---------------------------
The Investor Rights Agreement sets forth the following terms for the
selection of the board of directors of Arris Group and the voting of the shares
of Arris Group Common Stock held by Nortel Networks:
o up to two nominees of Nortel Networks to the Arris Group board
of directors ("Investor Nominees") are to be included in any
slate of director nominees recommended to the Arris Group
stockholders by the Arris Group board of directors, provided
that in the event that the shares of Arris Group Common Stock
held by Nortel Networks decreases to (a) less than 20% of the
outstanding shares of Arris Group Common Stock, Nortel
Networks will be entitled to only one Investor Nominee, and
(b) less than 10% of the outstanding shares of Arris Group
Common Stock, Nortel Networks will no longer be entitled to an
Investor Nominee;
o Nortel Networks will vote its shares of Arris Group Common
Stock for the election of the slate of nominees proposed by
the board of directors of Arris Group, provided that the
Investor Nominees are included in such slate;
CUSIP NO. 04269Q100 Page 9 of 23 Pages
o at least 60% of the members of the board of directors of Arris
Group are to be unaffiliated with either Arris Group or Nortel
Networks; and
o the size of Arris Group's board of directors will not exceed
15 members without the consent of Nortel Networks.
As a result of the exercise of the Stock Option, and the
consummation of the transactions contemplated thereby, Nortel Networks currently
holds 18.8% of the outstanding shares of Arris Group Common Stock and,
accordingly, is only entitled to one Investor Nominee. The Investor Nominee of
Nortel Networks is currently Randy K. Dodd, President of the Sales-IXC-Regional
Accounts for Nortel Networks.
Acquisition of Arris Group Securities.
-------------------------------------
The Investor Rights Agreement sets forth the following limitations
on transactions related to the acquisition of securities of Arris Group. Nortel
Networks will not (a) with limited exceptions, acquire or propose to acquire
greater than 49.9% of the outstanding shares of Arris Group Common Stock; (b)
propose or seek to effect any merger, business combination, restructuring,
recapitalization or similar transaction involving Arris Group or any of its
subsidiaries or the sale of all or substantially all of the assets of Arris
Group or any of its subsidiaries; (c) except for the exercise by the Investor
Nominees of their fiduciary duties, seek election to, seek to place a
representative on, or seek the removal of any member of, the Arris Group board
of directors; (d) engage in a proxy contest or solicitation; or (e) call a
meeting of stockholders or seek stockholder approval of any action or
participate in a group with other holders of Arris Group voting securities.
Notwithstanding the forgoing, Nortel Networks is authorized to
participate in discussions or negotiations regarding the acquisition of Arris
Group by an unaffiliated third party provided that such third-party's offer is
for at least 90% of the outstanding shares of Arris Group Common Stock held by
stockholders other than Nortel Networks, its affiliates or the third party (the
"Unaffiliated Stockholders"). In addition, at least a majority of the shares of
Arris Group Common Stock held by the Unaffiliated Stockholders must be tendered
in the third-party offer.
In the event that Nortel Networks acquires more than 49.9% of the
outstanding Arris Group Common Stock as a result of an acquisition of an
unaffiliated business entity, Arris Group may require Nortel Networks to dispose
of shares held by it or its affiliates in excess of 49.9%. Such disposition must
be completed within 12 months after Arris Group issues a request. The Investor
Rights Agreement allows Nortel Networks to acquire greater than 49.9% of the
Arris Group Common Stock provided that it makes an offer to acquire at least 90%
of the outstanding Arris Group Common Stock. In the event that Arris Group does
not accept Nortel Networks' offer, Arris Group is required to initiate an
auction process for the sale of Arris Group. If Nortel Networks is not the
successful bidder in the auction or does not elect to participate in the auction
and Arris Group has received a fairness opinion from a nationally recognized
investment banking firm that the successful bidder's transaction provides the
highest value to Arris Group or its stockholders of all of the bids in the
auction, then Nortel Networks is obligated to vote in favor of the winning
transaction in the auction and to tender its shares of Arris Group Common Stock.
Except in conjunction with a permitted offer, Nortel Networks
CUSIP NO. 04269Q100 Page 10 of 23 Pages
may not become a participant in the solicitation of proxies concerning any
transaction relating to the voting securities of Arris Group. Nortel Networks
has no current intention to acquire additional shares of Arris Group Common
Stock.
Disposition of Arris Group Common Stock.
---------------------------------------
The Investor Rights Agreement provides that Nortel Networks shall be
permitted to dispose of any shares of Arris Group Common Stock to any person or
persons in any manner at any time and from time to time, subject to certain
limited restrictions set forth more fully therein.
Termination.
-----------
The Investor Rights Agreement may be terminated by either Arris
Group or Nortel Networks if:
o a transaction as a result of a third-party offer is
consummated;
o the parties mutually agree in writing; or
o at any time after Nortel Networks and its affiliates cease to
own shares representing at least 10% of the total voting power
of Arris Group.
THE LOCK-UP AGREEMENT. On June 7, 2002, Nortel Networks and Liberty
ANTC, Inc. ("Liberty") entered into a Lock-Up Agreement (the "Lock-Up
Agreement") pursuant to which each party has agreed not to exercise its
registration rights or sell any shares of Arris Group Common Stock pursuant to
Rule 144 of the Securities Act, during the Restricted Period (as defined below),
excluding in the case of Nortel Networks the shares of Arris Group Common Stock
sold by it in the Offering. If Nortel Networks sells any shares of Arris Group
Common Stock registered pursuant to the S-3 Registration Statement and not sold
in the Offering, the buyer of such shares would be bound by the limitations in
the Lock-Up Agreement. During the Restricted Period, Nortel Networks may sell
its remaining shares of Arris Group Common Stock only in a private transaction.
The "Restricted Period" commenced on June 25, 2002, the date of the consummation
of a firm commitment underwritten public offering pursuant to the S-3
Registration Statement and expires on the earlier of July 31, 2003 and thirty
days after the completion of both of the following: (i) the refinancing,
redemption or maturity of at least 66% of the original principal amount of those
certain 4 1/2% Convertible Subordinated Notes made by Arris Group due May 15,
2003, and (ii) the redemption by Arris LLC of at least 66% of the original
principal amount of Nortel Networks' New Membership Interest plus accrued
dividends. A copy of the Lock-Up Agreement is filed as Exhibit 6 to the
Statement and incorporated herein by reference. Please see "Lock-Up Letter
Agreement" below for a description of waivers under the Lock-Up Agreement.
OPTION AGREEMENT. On June 7, 2002, Nortel Networks LLC, Arris LLC
and Arris Group entered into the Option Agreement that entitled Arris LLC to
redeem Nortel Networks' New Membership Interest in Arris LLC at a discount of up
to 40% as a result of Nortel Networks' sale of shares of Arris Group Common
Stock in a firm commitment underwritten public offering pursuant to the S-3
Registration Statement on or before June 30, 2002. The
CUSIP NO. 04269Q100 Page 11 of 23 Pages
amount of the discount correlated to the percentage of shares of Arris Group
Common Stock that Nortel Networks owned as of June 30, 2002. Based upon the
percentage of shares of Arris Group Common Stock that Nortel Networks owned as
of June 30, 2002, the discount percentage was equal to 21%.
On March 18, 2003, pursuant to the terms of the Option Agreement, as
amended by the Stock Option Agreement, Nortel Networks Inc., as the successor in
interest to Nortel Networks LLC, assigned in full its New Membership Interest to
ANTEC for an aggregate consideration of $86,430,388.89. Such amount represented
a 21% discount on the New Membership Interest and included forgiveness of a
portion of the Class B Return equal to $7,500,000 (i.e., the net amount of this
forgiveness after the 21% discount provided for in the Option Agreement was
$5,925,000). A copy of the Option Agreement is filed as Exhibit 7 to the
Statement and incorporated herein by reference.
UNDERWRITING AGREEMENT. On June 19, 2002, Nortel Networks LLC, Arris
Group, and CIBC and J.P. Morgan, as representatives of the several underwriters
set forth in Schedule I thereto, entered into the Underwriting Agreement
pursuant to which Nortel Networks LLC agreed to sell 15,000,000 shares of Arris
Group Common Stock to the underwriters and granted the underwriters an
over-allotment option with respect to an additional 2,250,000 shares of Arris
Group Common Stock. On June 25, 2002, Nortel Networks consummated the sale to
the Underwriters of a total of 15,000,000 shares of Arris Group Common Stock.
The shares of Arris Group Common Stock were sold to the public at a price of
$4.71 per share, and Nortel Networks received proceeds of $4.4745 per share, or
an aggregate of $67,117,500. Pursuant to the Underwriting Agreement, Arris Group
and Nortel Networks have agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act. A copy of the
Underwriting Agreement is filed as Exhibit 8 to the Statement and incorporated
herein by reference.
STOCK OPTION AGREEMENT. Pursuant to the Stock Option Agreement,
Nortel Networks Inc. granted to Arris Group, for consideration of $1.00, an
option to purchase in cash, from time to time (but in no event on more than four
occasions and in each event for at least 1,000,000 shares of Arris Group Common
Stock) up to an aggregate of 16,000,000 shares of Arris Group Common Stock. The
exercise price per share of the Stock Option will be equal to 90% of either: (i)
in the event that the exercise occurs within seven calendar days of the closing
of the Note Offering, the closing price on the Nasdaq National Market System for
shares of Arris Group Common Stock on the date that the Note Offering is priced;
and (ii) otherwise, the five trading day weighted average price of the shares of
Arris Group Common Stock immediately preceding the date of exercise. The Stock
Option Agreement provides that, notwithstanding the foregoing, the exercise
price shall not be less than $4.00 per share of Arris Group Common Stock, except
that with respect to 8,000,000 shares of Arris Group Common Stock the exercise
price may be less than $4.00 per share of Arris Group Common Stock but not less
than $3.50 per share of Arris Group Common Stock, provided that to the extent
that the exercise price for any shares is between $3.50 and $4.00 per share,
there shall be a reduction in the forgiveness of the Class B Return equal to the
Class B Reduction.
In addition, the Stock Option Agreement provides that the Stock
Option will terminate upon the earliest of (i) March 31, 2003, in the event that
the Note Offering does not
CUSIP NO. 04269Q100 Page 12 of 23 Pages
close by such date, (ii) June 30, 2003, and (iii) at Nortel Networks Inc.'s
election, on the occurrence of a change in control, a material change in Arris
Group's business, or the commencement of a third-party tender offer for shares
of Arris Group Common Stock. The Stock Option may be exercised only if (i) the
Note Offering has closed, (ii) the Option (as defined in the Option Agreement)
has been exercised in full, (iii) Arris LLC is not in breach of that certain
settlement and release agreement between Nortel Networks Inc. and Arris LLC
dated as of March 11, 2003, and (iv) Arris Group has obtained all necessary
consents under its credit agreement.
On March 20, 2003, in accordance with the terms of the Stock Option
Agreement, Arris Group exercised the Stock Option for 8,000,000 shares of Arris
Group Common Stock at an exercise price per share equal to $3.50. On March 24,
2003, Nortel Networks Inc. consummated the sale of 8,000,000 shares of Arris
Group Common Stock to Arris Group for an aggregate consideration of $28,000,000.
Pursuant to the terms of the Stock Option Agreement, there was also a reduction
in the forgiveness of the Class B Return equal to 50% of the product of (a) the
difference between $4.00 per share and the exercise price per share ($3.50),
multiplied by (b) the number of shares of Arris Group Common Stock acquired upon
exercise (8,000,000). Accordingly, the amount of this forgiveness was reduced by
$2,000,000, which amount was wired to Nortel Networks on March 24, 2003. A copy
of the Stock Option Agreement is filed as Exhibit 9 to the Statement and
incorporated herein by reference.
REGISTRATION RIGHTS LETTER AGREEMENT. On March 11, 2003, Nortel
Networks Inc. and Arris Group entered into a letter agreement (the "Registration
Rights Letter Agreement"), pursuant to which the parties have memorialized
certain agreements that have been reached with respect to the Registration
Rights Agreement. The Registration Rights Letter Agreement provides as follows:
(i) limitations in the Registration Rights Agreement relating to the size and
timing of registrations shall not apply to any shares of Arris Group Common
Stock loaned pursuant to the Master Securities Loan Agreement (the "Covered
Shares"); (ii) any shares that are returned pursuant to the Master Securities
Loan Agreement shall constitute Registrable Shares (as defined in the
Registration Rights Agreement); (iii) Nortel Networks shall be entitled to have
the Covered Shares registered or reregistered; and (iv) notwithstanding any
limitations contained in the Registration Rights Agreement, if at any time the
residual Registrable Shares held by Nortel Networks Inc. is less than 5% of the
then outstanding shares of Arris Group Common Stock, Nortel Networks Inc. shall
be entitled to cause Arris Group to effect a single registration under the
Registration Rights Agreement of all (but not less than all) of the residual
Registrable Shares, provided that Nortel Networks Inc. is not then entitled to
sell such amount pursuant to Rule 144(e)(1) of the Securities Act.
In addition, pursuant to the terms of the Registration Rights Letter
Agreement, Arris Group acknowledges that the transactions contemplated by the
Master Securities Loan Agreement are not inconsistent with the Investor Rights
Agreement, and that Nortel Networks Inc. shall be deemed to beneficially own the
Covered Shares for purposes of the Investor Rights Agreement while such shares
are loaned under the Master Securities Loan Agreement. A copy of the
Registration Rights Letter Agreement is filed as Exhibit 10 to the Statement and
incorporated herein by reference.
CUSIP NO. 04269Q100 Page 13 of 23 Pages
CIBC LOCK-UP AGREEMENT. On March 11, 2003, Nortel Networks Inc. and
CIBC entered into a Lock-Up Agreement (the "CIBC Lock-Up Agreement") pursuant to
which Nortel Networks Inc. has agreed that without the prior consent of CIBC,
which shall not be unreasonably withheld, Nortel Networks Inc. will not, during
the period ending 90 days after March 12, 2003, the date of the offering
circular relating to the Note Offering (the "CIBC Lock-Up Period"), (i) offer,
pledge, announce the intention to sell, sell, contract to sell, sell any option
or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase or otherwise transfer or dispose of,
directly or indirectly, any shares of Arris Group Common Stock or any securities
convertible into or exercisable or exchangeable for Arris Group Common Stock
other than (A) as a bona fide gift or bona fide gifts; provided, however, that
the recipient of such bona fide gift or gifts shall execute and be bound by the
terms of the CIBC Lock-Up Agreement, or (B) the sale of any shares of Arris
Group Common Stock acquired upon exercise of options granted under Arris Group's
stock option or stock incentive plans that would otherwise expire during the
CIBC Lock-Up Period, or (ii) enter into any swap or other agreement that
transfers, in whole or in part, any of the economic consequences of ownership of
Arris Group Common Stock, whether any such transaction described in clause (i)
or (ii) above is to be settled by delivery of Arris Group Common Stock or such
other securities, in cash or otherwise.
Notwithstanding the foregoing, the terms of the CIBC Lock-Up
Agreement do not prohibit Nortel Networks from (i) entering into the Stock
Option Agreement, or selling any shares of Arris Group Common Stock upon one or
more exercises of the Stock Option, (ii) loaning shares of Arris Group Common
Stock to CIBC pursuant to the Master Securities Loan Agreement, (iii) the making
of any demand for or the exercising of any right with respect to the
registration of up to 6,000,000 shares of Arris Group Common Stock or any
security convertible into or exercisable or exchangeable for Arris Group Common
Stock, or (iv) the announcement or disclosure of any of the foregoing as
required by law. A copy of the CIBC Lock-Up Agreement is filed as Exhibit 11 to
the Statement and incorporated herein by reference.
LOCK-UP LETTER AGREEMENT. On March 11, 2003, Nortel Networks Inc.
and Liberty ANTC, Inc. entered into a letter agreement (the "Lock-Up Letter
Agreement"), pursuant to which the parties memorialized certain agreements that
have been reached with respect to the Lock-Up Agreement. The Lock-Up Letter
Agreement permits Nortel Networks Inc. to loan shares of Arris Group Common
Stock pursuant to the Master Securities Loan Agreement and exercise registration
rights with respect to shares of Arris Group Common Stock returned to Nortel
Networks Inc. pursuant to the Master Securities Loan Agreement. A copy of the
Lock-Up Letter Agreement is filed as Exhibit 12 to the Statement and
incorporated herein by reference.
MASTER SECURITIES LOAN AGREEMENT. Pursuant to the Master Securities
Loan Agreement, CIBC may from time to time borrow up to 6,000,000 shares of
Arris Group Common Stock from Nortel Networks Inc. subject to certain
restrictions and with the agreement of Nortel Networks Inc. Such shares may be
offered directly to one or more purchasers of the Convertible Notes sold in
connection with the Note Offering at negotiated prices, at market prices
prevailing at the time of sale of the shares of Arris Group Common Stock or at
prices related to such market prices, in connection with CIBC's market-making
activities. The availability of the shares of Arris Group Common Stock under the
Master Securities Loan Agreement, if any, at any time is not assured and any
such availability does not assure market-making activity with respect to the
Convertible Notes and any market-making actually engaged
CUSIP NO. 04269Q100 Page 14 of 23 Pages
in by CIBC may cease at any time. A copy of the Master Securities Loan Agreement
is filed as Exhibit 13 to the Statement and incorporated herein by reference.
The foregoing summaries of the Reorganization Agreement, the
Investor Rights Agreement, the Arris LLC Operating Agreement, the Registration
Rights Agreement, the Lock-Up Agreement, the Option Agreement, the Underwriting
Agreement, the Stock Option Agreement, the Registration Rights Letter Agreement,
the CIBC Lock-Up Agreement, the Lock-Up Letter Agreement and the Master
Securities Loan Agreement do not purport to be complete and are qualified in
their entirety by reference to the text of such agreements incorporated by
reference herein.
Except as provided in the Reorganization Agreement, the Investor
Rights Agreement, the Arris LLC Operating Agreement, the Registration Rights
Agreement, the Lock-Up Agreement, the Option Agreement, the Underwriting
Agreement, the Stock Option Agreement, the Registration Rights Letter Agreement,
the CIBC Lock-Up Agreement, the Lock-Up Letter Agreement or the Master
Securities Loan Agreement or as set forth in this Schedule 13D, neither Nortel
Networks Corporation nor, to the best of Nortel Networks Corporation's
knowledge, any of the individuals named in Schedule I hereto has any contracts,
arrangements, understandings or relationships (legal or otherwise) with any
person with respect to any securities of Arris Group, including, but not limited
to, transfer or voting of any of the securities, finder's fees, joint ventures,
loan or option arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
Item 7. Material To Be Filed as Exhibits.
------ --------------------------------
Exhibit 1 -- Second Amended and Restated Limited Liability Company
Agreement of Arris Interactive L.L.C., dated as of August 3,
2001, among Arris International, Inc. (f/k/a ANTEC
Corporation), Arris Group, Inc. and Nortel Networks LLC
(incorporated herein by reference to the Reporting Person's
Statement on Schedule 13D, dated August 3, 2001, filed with
the Securities and Exchange Commission on August 13, 2001).
Exhibit 2 -- Agreement and Plan of Reorganization, dated as of
October 18, 2000, among ANTEC Corporation, Broadband Parent
Corporation, Broadband Transition Corporation, Nortel
Networks Inc., Nortel Networks LLC and Arris
Interactive L.L.C. (incorporated herein by reference to
Exhibit 2.1 to Form 8-K (File No. 000-22336), filed by ANTEC
Corporation on October 25, 2000).
Exhibit 3 -- First Amendment to Agreement and Plan of Reorganization,
dated as of April 9, 2001, among ANTEC Corporation,
Broadband Parent Corporation, Broadband Transition
Corporation, Nortel Networks Inc., Nortel Networks LLC and
Arris Interactive L.L.C. (incorporated herein by reference
to Exhibit 2.1 to Form 8-K (File No. 000-22336), filed by
ANTEC Corporation on April 13, 2001).
Exhibit 4 -- Registration Rights Agreement, dated as of August 3, 2001,
between Arris
CUSIP NO. 04269Q100 Page 15 of 23 Pages
Group, Inc. and Nortel Networks LLC (incorporated herein by
reference to the Reporting Person's Statement on Schedule
13D, dated August 3, 2001, filed with the Securities and
Exchange Commission on August 13, 2001).
Exhibit 5 -- Lock-Up Agreement, dated as of June 7, 2002, by and between
Nortel Networks LLC and Liberty ANTC, Inc. (formerly known as
TCI TSX, Inc.) (incorporated herein by reference to the
Reporting Person's Amendment No. 1 to Statement on Schedule
13D, dated June 7, 2002, filed with the Securities and
Exchange Commission on June 11, 2002).
Exhibit 6 -- Option Agreement, dated as of June 7, 2002, by and among
Nortel Networks LLC, Arris Interactive L.L.C., and Arris
Group, Inc. (incorporated herein by reference to
Exhibit 10.2 to Form 8-K (File No. 001-16631), filed by
Arris Group, Inc. on June 10, 2002).
Exhibit 7 -- Second Amended and Restated Investor Rights Agreement, dated
as of June 7, 2002, by and among Nortel Networks LLC, Nortel
Networks Inc. and Arris Group, Inc., f/k/a Broadband Parent
Corporation (incorporated herein by reference to
Exhibit 10.3 to Form 8-K (File No. 001-16631), filed by
Arris Group, Inc. on June 10, 2002).
Exhibit 8 -- Underwriting Agreement, dated as of June 19, 2002, among
Nortel Networks LLC, Arris Group, Inc. and CIBC World
Markets Corp. and J.P. Morgan Securities Inc., as
representatives of the several underwriters named in
Schedule I thereto (incorporated herein by reference to
Exhibit 1.1 to Form 8-K (File No. 001-16631), filed by Arris
Group, Inc. on June 20, 2002).
Exhibit 9 -- Letter Agreement, dated as of March 11, 2003, among Nortel
Networks Inc., Arris Interactive L.L.C. and Arris
Group, Inc. (incorporated herein by reference to the
Reporting Person's Amendment No. 4 to Statement on Schedule
13D, dated March 11, 2003, filed with the Securities and
Exchange Commission on March 13, 2003).
Exhibit 10 -- Letter Agreement, dated as of March 11, 2003, by and between
Nortel Networks Inc. and Arris Group, Inc. (incorporated
herein by reference to the Reporting Person's Amendment No.
4 to Statement on Schedule 13D, dated March 11, 2003, filed
with the Securities and Exchange Commission on March 13,
2003).
Exhibit 11 -- Lock-Up Agreement, dated as of March 11, 2003, by and
between Nortel Networks Inc. and CIBC World Markets Corp.
(incorporated herein by reference to the Reporting Person's
Amendment No. 4 to Statement on Schedule 13D, dated March
11, 2003, filed with the Securities and Exchange Commission
on March 13, 2003).
Exhibit 12 -- Letter Agreement, dated as of March 11, 2003, by and between
Nortel Networks Inc. and Liberty ANTC, Inc. (incorporated
herein by reference to
CUSIP NO. 04269Q100 Page 16 of 23 Pages
the Reporting Person's Amendment No. 4 to Statement on
Schedule 13D, dated March 11, 2003, filed with the Securities
and Exchange Commission on March 13, 2003).
Exhibit 13 -- Master Securities Loan Agreement, dated as of March 11,
2003, by and between Nortel Networks Inc. and CIBC World
Markets Corp. (incorporated herein by reference to the
Reporting Person's Amendment No. 4 to Statement on Schedule
13D, dated March 11, 2003, filed with the Securities and
Exchange Commission on March 13, 2003).
CUSIP NO. 04269Q100 Page 17 of 23 Pages
SIGNATURES
After reasonable inquiry and to the best of the knowledge and belief of the
undersigned, the undersigned certify that the information set forth in this
statement is true, complete and correct.
Date: March 25, 2003 NORTEL NETWORKS CORPORATION
By: /s/ Douglas Beatty
----------------------------------------
Douglas Beatty
Chief Financial Officer
By: /s/ Gordon Davies
----------------------------------------
Gordon Davies
Assistant Secretary
CUSIP NO. 04269Q100 Page 18 of 23 Pages
SCHEDULE I
NORTEL NETWORKS CORPORATION
AND
NORTEL NETWORKS LIMITED
DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN NON-EXECUTIVE BOARD
APPOINTED OFFICERS
The name, citizenship, present principal occupation or employment,
and the name of any corporation or other organization in which such employment
is conducted, of each of the directors, executive officers and certain
non-executive board appointed officers of Nortel Networks Corporation and Nortel
Networks Limited is set forth below. Unless otherwise indicated below, the
business address of each director, executive officer and certain non-executive
board appointed officers is Nortel Networks Corporation and Nortel Networks
Limited, 8200 Dixie Road, Suite 100, Brampton, Ontario L6T 5P6, Canada.
PRESENT PRINCIPAL
NAME AND CITIZENSHIP OCCUPATION OR EMPLOYMENT
DIRECTORS
Blanchard, James J. Piper Rudnick
American 901-15th Street, N.W., Suite 700
Washington, DC 20005-2301 U.S.A.
Brown, Robert E. Director
Canadian/British Nortel Networks Corporation and
Nortel Networks Limited
Cleghorn, John E. Chairman of the Board
Canadian SNC-Lavalin Group Inc.
200 Bay Street, South Tower, Suite 3115
Royal Bank Plaza
Toronto, Ontario M5J 2J5 Canada
Dunn, Frank A. President and Chief Executive Officer
Canadian Nortel Networks Corporation and
Nortel Networks Limited
Fortier, L. Yves Chairman and Senior Partner
Canadian Ogilvy Renault
1981 McGill College Avenue, 12th Floor
Montreal, Quebec H3A 3C1 Canada
Ingram, Robert A. Vice Chairman Pharmaceuticals
American GlaxoSmithKline plc
5 Moore Drive
Research Triangle Park, N.C. 27709 U.S.A.
CUSIP NO. 04269Q100 Page 19 of 23 Pages
Owens, William A. Co-Chief Executive Officer and
American Vice Chairman
Teledesic LLC
1445 120th Avenue N.E.
Bellevue, WA 98005 U.S.A.
Saucier, Guylaine 1321 Sherbrooke Street West, Suite C-61
Canadian Montreal, Quebec H3G 1J4 Canada
Smith, Jr., Sherwood H. Chairman Emeritus of the Board
American CP&L
One Hanover Square Building
411 Fayetteville Street Mall
Raleigh, N.C. 27601-1748 U.S.A.
Wilson, Lynton R. Chairman of the Board
Canadian CAE Inc.
483 Bay Street, Floor 7, North Tower
Toronto, Ontario M5G 2E1 Canada
Chairman of the Board of Nortel Networks
Corporation
and Nortel Networks Limited
OFFICERS
Dunn, Frank A. President and Chief Executive Officer
Canadian
Beatty, Douglas C. Chief Financial Officer
Canadian
DeRoma, Nicholas J. Chief Legal Officer
American
Mumford, D. Gregory Chief Technology Officer
Canadian
Debon, Pascal President, Wireless Network
French
Bolouri, Chahram President, Global Operations
Canadian
McFadden, Brian W. President, Optical Networks
Canadian
Donahee, Gary R. President, Americas
American
CUSIP NO. 04269Q100 Page 20 of 23 Pages
Pusey, Stephen C. President, Europe, Middle East and Africa
U.K.
Spradley, Susan President, Wireline Networks
American
Tariq, Masood A. President, Global Alliances
Canadian/American
Donovan, William J. Senior Vice-President, Human Resources
American
Gollogly, Michael J. Controller
Canadian
Donoghue, Adrian J. * General Auditor
Canadian
Stevenson, Katharine B. Treasurer
Canadian/American
Noble, Deborah J. * Corporate Secretary
Canadian
Schilling, Steven L. President, Enterprise Accounts
American
Mezon, Linda F. * Assistant Controller
Canadian/American
Doolittle, John M. * Vice-President, Tax
Canadian
Morrison, Blair F. * Assistant Secretary
Canadian
Pahapill, MaryAnne E. * Assistant Treasurer
Canadian
Collins, Malcolm K. President, Enterprise Networks
U.K.
Hitchcock, Albert R. * Chief Information Officer
U.K.
Mao, Robert President and Chief Executive Officer,
American Greater China
CUSIP NO. 04269Q100 Page 21 of 23 Pages
Joannou, Dion President, CALA
American
Davies, Gordon * Assistant Secretary
Canadian
Giamatteo, John J. President, Asia Pacific
American
* Non-executive board appointed officers
CUSIP NO. 04269Q100 Page 22 of 23 Pages
DIRECTORS, EXECUTIVE OFFICERS AND NON-EXECUTIVE
BOARD APPOINTED OFFICERS OF
NORTEL NETWORKS INC.
The name, citizenship, present principal occupation or employment,
and the name of any corporation or other organization in which such employment
is conducted, of each of the directors, executive officers and non-executive
board appointed officers of Nortel Networks Inc. is set forth below. Unless
otherwise indicated below, the business address of each director, executive
officer and non-executive board appointed officer is Nortel Networks Inc., 200
Athens Way, Nashville, Tennessee 37228-1397 USA.
PRESENT PRINCIPAL
NAME AND CITIZENSHIP OCCUPATION OR EMPLOYMENT
DIRECTORS
Cross, Mary M. President, Nortel Networks Inc.
American
Stevenson, Katharine B. Treasurer, Nortel Networks Corporation and
Canadian/American Nortel Networks Limited
8200 Dixie Road, Suite 100
Brampton, Ontario L6T 5P6 Canada
OFFICERS
Cross, Mary M. President
American
Egan, Lynn C. * Assistant Secretary
American
Gigliotti, Thomas A. * Assistant Secretary
American 4001 E. Chapel Hill-Nelson Highway
Research Triangle Park, N.C. 27709 U.S.A.
Higginbotham, Ernest R. * Assistant Secretary
American 2221 Lakeside Blvd.
Richardson, TX 75082-4399 U.S.A.
Knudsen, Paul T. * Assistant Secretary
Canadian 5405 Windward Parkway
Alpharetta, GA 30004 U.S.A.
Krebs, Laurie Vice President, Tax
American 4001 E. Chapel Hill-Nelson Highway
Research Triangle Park, N.C. 27709 U.S.A.
CUSIP NO. 04269Q100 Page 23 of 23 Pages
LaSalle, William J. * Secretary
American Nortel Networks Limited
8200 Dixie Road, Suite 100
Brampton, Ontario L6T 5P6 Canada
Lester, Monica L. Treasurer
American
Morfe, Claudio * Assistant Secretary
American 880 Technology Park
Billerica, MA 01821 U.S.A.
Noble, Deborah J. * Corporate Secretary
Canadian Nortel Networks Corporation and
Nortel Networks Limited
Assistant Secretary, Nortel Networks Inc.
8200 Dixie Road, Suite 100
Brampton, Ontario L6T 5P6 Canada
Stout, Allen Vice President, Finance
American
* Non-executive board appointed officers