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                                                                    EXHIBIT 10.5




                                      AYAVA
                            SHORT TERM INCENTIVE PLAN
                            Effective October 1, 2000


         1. PURPOSE. The purpose of the Ayava Short Term Incentive Plan (the
"Plan") is to provide Officers of Avaya Inc. (the "Company") and its affiliates
with incentive compensation based upon the level of achievement of financial and
other performance criteria. The Plan will enhance the ability of the Company and
its affiliates to attract individuals of exceptional managerial talent upon
whom, in large measure, the sustained progress, growth and profitability of the
Company depends.

         2. DEFINITIONS. As used in the Plan, the following terms shall have the
meanings set forth below:

         (a) "AWARD" shall mean a cash payment.

         (b) "BOARD" shall mean the Board of Directors of the Company.

         (c) "CODE" shall mean the Internal Revenue Code of 1986, as amended
from time to time and any successor thereto.

         (d) "COMMITTEE" shall mean the Corporate Governance and Compensation
Committee of the Board (or any successor committee).

         (e) "COVERED EMPLOYEE" shall mean a "covered employee" within the
meaning of Section 162(m) of the Code.

         (f) "NET INCOME" shall mean the net income of the Company as determined
under generally accepted accounting principles, excluding (a) extraordinary
items (net of applicable taxes); (b) cumulative effects of changes in accounting
principles; (c) securities gains and losses (net of applicable taxes); and (d)
nonrecurring items (net of applicable taxes) including, but not limited to,
gains or losses on asset dispositions and sales of divisions, business units or
subsidiaries, restructuring charges, gains and losses from qualified benefit
plan curtailments and settlements, and income or expenses related to deferred
tax assets.

         (g) "OFFICER" shall mean any manager of the Company or any affiliate
holding a position above the executive ("E Band") level or any salary grade
level that the Committee determines, in its sole discretion, is the equivalent
thereof.
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         (h) "OUTSIDE DIRECTORS" shall mean those members of the Board who are
"outside directors" within the meaning of Section 162(m) of the Code.

         (i) "PARTICIPANT" shall mean any person selected by the Committee to
participate in the Plan.

         (j) "PERFORMANCE YEAR" shall mean the fiscal year in which a
Participant provides services on account of which the Award is made.

         (k) "PERSON" shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization, or
government or political subdivision thereof.

         (l) "TARGET AWARD" shall mean an Award level that may be paid if
certain performance criteria are achieved in the Performance Year.

         3. ELIGIBILITY. Persons employed by the Company or any of its
affiliates during a Performance Year in active service at an Officer level are
eligible to be Participants under the Plan for such Performance Year (whether or
not so employed or living at the date an Award is made) and may be considered by
the Committee for an Award. An Officer is not rendered ineligible to be a
Participant by reason of being a member of the Board.

         4. AWARDS-GENERAL. The Committee will establish Target Awards for
Participants at the beginning of each Performance Year and the performance
criteria to be applicable to Awards for such Performance Year. The performance
criteria utilized by the Committee may be based on individual performance,
earnings per share, other Company and business unit financial objectives,
customer satisfaction indicators, operational efficiency measures, and other
measurable objectives tied to the Company's success or such other criteria as
the Committee shall determine. Awards will be made by the Committee following
the end of each Performance Year. Awards shall be paid as soon as practicable
after the Performance Year, except to the extent that a Participant has made an
election to defer the receipt of such Award pursuant to the Avaya Inc. Deferred
Compensation Plan or any successor plan having a similar function. The Award
amount with respect to a Participant shall be determined in the sole discretion
of the Committee, or, in the case of an Award to a Participant who is not a
Covered Employee, in the sole discretion of such person or committee empowered
by the Committee or Board. The determination of the Award amount for each
Participant shall be made at the end of each Performance Year and may be less
than (including no Award) or, in the case of a Participant who is not a Covered
Employee, greater than the Target Award.

         5. AWARDS TO COVERED EMPLOYEES. (a) If the Committee determines at the
time a Target Award is established for a Participant that such Participant is,
or may be as of the end of the tax year for which the Company would claim a tax
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deduction in connection with such Award, a Covered Employee, then the Committee
may provide that this Section 5 is applicable to such Award under such terms as
the Committee shall determine.

          (b) If an Award is subject to this Section 5, then the payment of cash
pursuant thereto shall be subject to the Company having a level of Net Income
for the applicable Performance Year set by the Committee within the time
prescribed by Section 162(m) of the Code or the regulations thereunder in order
for the level to be considered "pre-established". The Committee may, in its
discretion, reduce the amount of such an Award at any time prior to payment
based on such criteria as it shall determine, including but not limited to
individual merit and the attainment of specified levels of one or any
combination of the following: net cash provided by operating activities,
earnings per share from continuing operations, operating income, revenues, gross
margin, return on operating assets, return on equity, economic value added,
stock price appreciation, total shareowner return (measured in terms of stock
price appreciation and dividend growth), or cost control, of the Company or the
affiliate or division of the Company for or within which the Participant is
primarily employed.

          (c) Notwithstanding any contrary provision of this Plan, the Committee
may not adjust upwards the amount payable pursuant to any Award subject to this
Section 5, nor may it waive the achievement of the Net Income requirement
contained in Section 5(b), except in the case of the death or disability of the
Participant.

          (d) Prior to the payment of any Award subject to this Section 5, the
Committee shall certify in writing that the Net Income requirement applicable to
such Award was met.

          (e) The Committee shall have the power to impose such other
restrictions on Awards subject to this Section 5 as it may deem necessary or
appropriate to ensure that such Awards satisfy all requirements for
"performance-based compensation" within the meaning of Section 162(m)(4)(C) of
the Code, the regulations promulgated thereunder, and any successors thereto.

         6. OTHER CONDITIONS. (a) No person shall have any claim to an Award
under the Plan and there is no obligation for uniformity of treatment of
Participants under the Plan. Awards under the Plan may not be assigned or
alienated.

          (b) Neither the Plan nor any action taken hereunder shall be construed
as giving to any Participant the right to be retained in the employ of the
Company or any affiliate.

          (c) The Company or any affiliate shall have the right to deduct from
any Award to be paid under the Plan any federal, state or local taxes required
by law to be withheld with respect to such payment.
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          (d) Awards under the Plan will, to the extent provided therein, be
included in base compensation or covered compensation under the retirement
programs of the company for purposes of determining pensions, retirement and
death related benefits.

          (e) In the event an Award under the Plan is deferred under the Avaya
Deferred Compensation Plan or any successor thereto, it will be reflected in the
calculations of the above benefit plans as if it had been paid as scheduled and
not deferred.

          (f) Notwithstanding any contrary provision of the Plan, the maximum
amount which may be paid to a Participant in any Performance Year is $9 million.

          7. DESIGNATION OF BENEFICIARIES. A Participant may, if the Committee
permits, designate a beneficiary or beneficiaries to receive all or part of the
Award which may be made to the Participant, or may be payable, after such
Participant's death. A designation of beneficiary shall be made in accordance
with procedures specified by the Company and may be replaced by a new
designation or may be revoked by the Participant at any time. In case of the
Participant's death, an Award with respect to which a designation of beneficiary
has been made (to the extent it is valid and enforceable under applicable law)
shall be paid to the designated beneficiary or beneficiaries. Any Award granted
or payable to a Participant who is deceased and not subject to such a
designation shall be distributed to the Participant's estate. If there shall be
any question as to the legal right of any beneficiary to receive an Award under
the Plan, the amount in question may be paid to the estate of the Participant,
in which event the Company or its affiliates shall have no further liability to
anyone with respect to such amount.

          8. PLAN ADMINISTRATION. (a) The Committee shall have full
discretionary power to administer and interpret the Plan and to establish rules
for its administration (including the power to delegate authority to others to
act for and on behalf of the Committee) subject to such resolutions, not
inconsistent with the Plan, as may be adopted by the Board, except that the
Committee (or any subcommittee thereof) shall have the exclusive authority to
exercise any such power with respect to Awards to which Section 5 is applicable.
In making any determinations under or referred to in the Plan, the Committee
(and its delegates, if any) shall be entitled to rely on opinions, reports or
statements of employees of the Company and its affiliates and of counsel, public
accountants and other professional or expert persons.

          (b) The Plan shall be governed by the laws of the State of Delaware
and applicable Federal law.

          9. MODIFICATION OR TERMINATION OF PLAN. The Board may modify or
terminate the Plan at any time, effective at such date as the Board may
determine. The Vice President - Human Resources of the Company or his delegate
with the concurrence of the General Counsel of the Company or his delegate (or,
in each case,
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any successor to either of such officer's responsibilities), shall be authorized
to make minor or administrative changes in the Plan or changes required by or
made desirable by law or government regulation. Such a modification may affect
present and future Participants. For purposes of this Section, a change to the
Plan that affects any Award to a Covered Employee shall not be a minor or
administrative change.



IN WITNESS WHEREOF, the Company has caused this Plan to be executed as of this
1st day of October, 2000.


AVAYA INC.


By:______________________________


Attest:__________________________