8-KMaterial Agreements

CIENA CORP 8-K Report, Material Agreement (Oct 21, 2009)

Filed October 21, 2009For Securities:CIEN

Summary

Ciena Corporation (CIEN) has filed an 8-K report detailing amendments to its asset sale agreements with Nortel Networks Corporation and its subsidiaries concerning the acquisition of Nortel's Metro Ethernet Networks (MEN) business assets. These amendments primarily adjust the terms related to a break-up fee payable to Ciena. Specifically, if either party terminates the agreements due to an alternative sale transaction approved by the Bankruptcy Courts, Ciena will receive the break-up fee within two business days of the consummation of such an alternative transaction, provided it occurs within twelve months of the termination date. The other termination provisions remain unchanged. These amendments were made in conjunction with the Bankruptcy Courts' approval of the original asset sale agreements, bidding procedures, sales process, and the scheduling of a sale hearing. This filing indicates progress in Ciena's potential acquisition of significant Nortel assets, with a focus on clarifying financial contingencies in the event of alternative deal scenarios.

Key Highlights

  • 1Ciena entered into amendments to its asset sale agreements with Nortel for the acquisition of optical networking and carrier Ethernet assets.
  • 2The amendments specifically modify the terms and conditions for Ciena receiving a break-up fee.
  • 3The break-up fee will be paid to Ciena within two business days following the consummation of an alternative sale transaction, if terminated by either party due to such a sale.
  • 4This alternative transaction must be consummated within twelve months following the termination of the agreements for the break-up fee to apply.
  • 5The amendments were made in connection with the Bankruptcy Courts' approval of the original agreements, bidding procedures, and sales process.
  • 6The Bankruptcy Courts involved include the United States Bankruptcy Court and the Ontario Superior Court of Justice.
  • 7The transaction involves substantially all of the North American, Caribbean and Latin American, Asian, European, Middle Eastern, and African (EMEA) optical networking and carrier Ethernet assets of Nortel’s Metro Ethernet Networks (MEN) business.

Frequently Asked Questions

The main purpose of this 8-K filing is to report on amendments made to Ciena's asset sale agreements with Nortel. These amendments primarily concern the conditions and timing under which Ciena would receive a break-up fee.

The amendments clarify that if the asset sale agreements are terminated because an alternative sale transaction for the assets is approved by the Bankruptcy Courts, Ciena will be paid a break-up fee. This fee is payable within two business days following the consummation of an alternative transaction that occurs within twelve months of the agreement termination.

Yes, the amendments were made in connection with the approval of the North American and EMEA asset sale agreements, as well as the bidding procedures, sales process, and sale hearing date, by the United States Bankruptcy Court and the Ontario Superior Court of Justice.

The agreements involve the purchase of substantially all of Nortel's Metro Ethernet Networks (MEN) business assets across North America, the Caribbean and Latin America, Asia, Europe, the Middle East, and Africa (EMEA).