Document:

exv10w75

 

Exhibit 10.75

CONFIDENTIAL-SPECIAL HANDLING

February 21,
2006

Mr. Pascal Debon

15190 Prestonwood Blvd.

Dallas, Texas 75248

U.S.A.

Dear Pascal:

This letter (“Agreement”) records the arrangements between you and Nortel Networks Inc.
(“Corporation”) concerning the cessation of your employment. The Agreement shall bind and inure to
the benefit of each party and their respective heirs, successors and assigns.

	1.	 	As used in this Agreement, the term “Corporation” shall mean Nortel Networks Inc., its
parent, subsidiaries, affiliates (including, but not limited to, Nortel Networks Corporation,
Nortel Networks Limited, Nortel Networks UK Limited and Nortel Networks S.A.), predecessors,
successors and assigns and all past and present officers, directors, employees and agents (in
their individual and representative capacities only) of Nortel Networks Inc., its parent,
subsidiaries, affiliates, predecessors, successors and assigns, in every case individually and
collectively.
	 
	2.	 	Your employment relationship with the Corporation ceased on December 23, 2005 (“Employment
Termination Date”). It is agreed and understood that as of the close of business on December
23, 2005, you were no longer expected to perform any duties or responsibilities on behalf of
the Corporation. All previous external responsibilities which you had were or will be assumed
by a person designated by the Corporation, including any participation in industry or other
associations representing the Corporation. You ceased to act as an Officer and/or Director of
any and all entities referred to in paragraph 1, above, as of Employment Termination Date, and
the Corporation has taken steps to remove you from all such positions.
	 
	3.	 	You acknowledge that you received this document on or about December 21, 2005, and have been
provided twenty-one (21) days commencing on or about December 21, 2005, at your discretion, to
consider this Agreement. In addition, you shall have seven

William J. Donovan

Senior-Vice President

Human Resources

Nortel

8200 Dixie Road Suite 100 Brampton ON Canada L6T 5P6 T 905.863.1100 F 905.863.8412 E billdono@nortel.com

 

 

			
	Mr. Pascal Debon

February 21, 2006

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(7) calendar days following your execution of this document to revoke this Agreement by written
notice. To be valid, the letter of revocation must be received by William J. Donovan (“me”)
at Nortel Networks, 4006 E. Chapel Hill-Nelson Highway, Research Triangle Park, North Carolina
27709, not later than the close of business seven (7) calendar days after you sign this
Agreement. The terms and conditions of this Agreement shall become operative seven (7) days
after you execute and deliver this Agreement to me, provided that you are in compliance with
all terms and conditions of this Agreement and that you have not revoked this Agreement
pursuant to the provisions set forth above in this paragraph.

	4.	 	The Corporation will provide you the applicable payments and benefits as set forth in
paragraphs 5 and 8 of this Agreement. Conditional only upon (i) your compliance with all
terms and conditions of this Agreement; and (ii) you not revoking this Agreement pursuant to
paragraph 3 above, the Corporation will:

	 	(a)	 	pay you the equivalent of two (2) years’ base salary as a salary continuance
benefit commencing with a lump sum payment of Two Hundred Ninety-Four Thousand Nine
Hundred Ninety-Nine and 90/100 ($294,999.90) United States Dollars (“Dollars”) to be made on June 24, 2006 and equal bi-weekly payments
thereafter of Twenty-Two Thousand Six Hundred Ninety-Two and 30/100 ($22,692.30)
Dollars through and including December 28, 2007 (collectively, “Severance Pay”).
The period during which your Severance Pay is calculated, from December 24, 2005
through December 28, 2007, is referred to in this Agreement as the “Severance
Period”. Your Severance Pay is an individually negotiated amount to be paid in a
different manner than and in lieu of any severance allowance benefit payable under
the Nortel Networks Enhanced Severance Allowance Plan. By this Agreement you
expressly waive any right to receive a benefit under the terms of the Nortel
Networks Enhanced Severance Allowance Plan;
	 
	 	(b)	 	allow you to elect to: (i) continue during the Severance Period, all group
life insurance (basic and optional employee and optional spouse and dependent), health
coverages (medical, dental, vision, hearing, Employee Assistance Program and Health
Care Reimbursement Account (“HCRA”) and AD&D coverage in which you and your covered
eligible dependents, if any, are enrolled on the Employment Termination Date pursuant
to the terms and conditions of such coverages; or (ii) revoke all such coverages. If
you elect (i), your coverages will continue at the active employee contribution rate,
which shall be deducted from Severance Pay set forth in paragraph 4(a). The
Corporation shall have the right to change coverages, upon notice provided to

 

 

			
	Mr. Pascal Debon

February 21, 2006

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you in
the same manner as to employees generally, only to the extent that it is generally
changing its coverages for senior executive employees occupying positions similar to
that you occupied in your most senior position with the Corporation. Upon termination
of coverages, only continued health coverage will be offered, as required by the
Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), for a period
generally extending for 18 months from your Employment Termination Date, minus the
period of coverage at active contribution rates during the Severance Period. If you
elect (ii), your life and AD&D coverages will terminate effective 12:01 a.m. on
January 1, 2006 and your health coverages, with the exception of HCRA, will terminate
at the end of the month in which your employment relationship ceases (December, 2005),
with an opportunity for continued health coverage under COBRA. If you decline the
opportunity to continue HCRA coverage under COBRA, only eligible expenses incurred on
or prior to the Employment Termination Date will be considered for reimbursement.
Irrespective if you select (i) or (ii) above, at the time your group life insurance
coverages terminate, you may convert appropriate coverages to applicable individual
policies. AD&D cannot be converted to an individual policy. Please make your
election in the space provided at the end of this Agreement concerning your
decision to elect or decline the benefits set forth in this paragraph 4(b);

	 	(c)	 	consider you ineligible for consideration for any future grant(s) of stock
options or Restricted Stock Units (RSUs). Stock options and RSUs previously granted
to you will continue to vest during the Severance Period in accordance with the
provisions of the plan under which the stock options or RSUs were granted and the
instrument of grant evidencing the grant. Your right, if any, to exercise any vested
Nortel Networks stock options or RSUs after the Employment Termination Date (including
during the Severance Period) will be determined in accordance with the provisions of
the stock option or RSU plan under which the stock options or RSUs were granted and
the instrument of grant evidencing the options or RSUs;
	 
	 	(d)	 	make available to you during the Severance Period, should you elect,
executive outplacement services to assist you in securing new employment and pay the
professional fees for such services as are reasonably incurred;
	 
	 	(e)	 	with respect to any monies or monetary equivalents to be paid hereunder, in
its reasonable discretion withhold appropriate amounts concerning any and all
applicable federal, state or local tax withholding;

 

 

			
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	 	(f)	 	pay you, on June 24, 2006, 2007 and 2008, a lump sum amount equal to the
actual cost, not to exceed Ten Thousand ($10,000) Dollars per payment, of personal
income tax preparation by a service provider selected by the Corporation for the tax
years 2005, 2006 and 2007, respectively;
	 
	 	(g)	 	pay you, on June 24, 2006, a lump sum amount of Eight Thousand Eight Hundred
Forty-Nine and 10/100 ($8,849.10) Dollars for the cost of your housing and furniture
rental to the conclusion of the term of your existing lease on February 28, 2006 for
the apartment located at 15190 Prestonwood Blvd., Dallas, Texas 75248, with respect to
the months of January and February 2006;
	 
	 	(h)	 	arrange and pay during the Severance Period for the shipment of your
household goods from the apartment in Dallas to your permanent residence in France,
subject to the terms, limits and exclusions of the Nortel Networks International
Assignment Long-Term Program; and
	 
	 	(i)	 	pay you, on June 24, 2006, a lump sum amount equivalent to the portion of the
cost of your continued life insurance coverage, as described in Section 4(b), which
would have been paid by the Corporation for the period of January through June of
2006.

	5.	 	The following payments and benefits shall be provided to you by the Corporation, as
applicable, without the requirement that you sign and comply with this Agreement:

	 	(a)	 	you shall be eligible for applicable benefits, pursuant to the terms and
conditions of the Nortel Networks Pension Service Plan and the Supplementary Executive
Retirement Plan (SERP), calculated on a basis consistent with the estimate of benefits
dated as of December 22, 2005, provided by the Corporation and attached hereto as
Exhibit A;
	 
	 	(b)	 	you will be allowed to elect to: (i) continue applicable health coverages, as
required by COBRA, for a period generally extending for 18 months following the
Employment Termination Date from the Corporation; (ii) convert your group life
insurance to an individual policy without a medical examination within 31 days of the
termination of that coverage; and (iii) to commence coverage under the Nortel Networks
Retiree Medical Plan and the Nortel Networks Retiree Life Plan pursuant to the terms
and conditions of those plans;

 

 

			
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February 21, 2006

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	 	(c)	 	the Corporation will consider you ineligible for consideration for any future
grant(s) of stock options or RSUs. Your right, if any, to exercise any vested Nortel
Networks stock options or RSUs before, on or after the Employment Termination Date
will be determined in accordance with the provisions of the stock option or RSU plan
under which the stock options or RSUs were granted and the instrument of grant
evidencing the options or RSUs;
	 
	 	(d)	 	contributions made by you and any amounts that have vested in your Nortel
Networks Long-Term Investment Plan (“LTIP”) account will be maintained or distributed
pursuant to your direction(s) as permitted by the terms and conditions of the LTIP;
	 
	 	(e)	 	the Corporation will distribute any amounts in your account in the Nortel
Networks U.S. Deferred Compensation Plan (“NNDP”) pursuant to your directions(s) as
permitted by the terms and conditions of the NNDP;
	 
	 	(f)	 	the Corporation will pay you, on or before the next regular payroll date
following your execution of this Agreement, a lump sum amount of One Hundred Thirteen
Thousand Four Hundred Sixty-One and 52/100 ($113,461.52) Dollars, which is the
equivalent of 10 weeks of base salary representing your current accrued but unused
vacation benefit, with no further vacation accrual subsequent to Employment
Termination Date, offset by the amount of housing and furniture rental, with respect
to the apartment described in paragraph 4(g) above, for the months of January and
February 2006, which was paid by the Corporation on your behalf and will be deemed to
be repaid by you as of the date of this Agreement, and also offset by the portion of
the cost of your continued life insurance coverage, as described in Section 4(b),
which has or would have been paid by the Corporation for the period of January through
June of 2006, and which will be deemed to be paid by you for such period; and
	 
	 	(g)	 	any shares in your account in the Nortel Networks Stock Purchase Plan
(“NNSPP”) will be distributed to you. If your account has not been closed within 90
days of the Employment Termination Date, it will automatically be closed by Mourant
Equity Compensation Solutions and all shares will be sold at the current market value.

	6.	 	The parties accept the following additional obligations:

 

 

			
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February 21, 2006

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	 	(a)	 	You shall reconcile and settle your employee expense account and any advances
made to you by the Corporation as soon as possible, but not later than thirty (30)
days after your execution of this Agreement.
	 
	 	(b)	 	You shall continue to maintain the confidentiality of all of the
Corporation’s trade secrets and confidential or proprietary commercial, technical or
other information; and specifically you agree that you shall not at any time during or
following your employment with the Corporation, disclose, other than to the
Corporation’s authorized personnel, or otherwise use for non-Corporation purposes, any
confidential or proprietary information (whether or not a trade secret) relating to an
activity of the Corporation.
	 
	 	(c)	 	The parties agree that this Agreement and all the terms and conditions
expressed herein, is subject to either party’s right or obligation to disclose this
Agreement in accordance with applicable securities laws or as may be necessary to
enforce this Agreement.
	 
	 	(d)	 	Upon the occurrence of any contingency which may affect your rights in or to
any subsequent payment or benefit, or affects the Corporation’s rights under this
Agreement, including without limitation, your obtaining new employment and/or the
commencement of coverage under a new employer’s benefit plan(s), you shall, within ten
(10) days of such occurrence, give written notice to the Corporation of that event.
Such notice shall be sent in writing to me.
	 
	 	(e)	 	So long as you are receiving the payments and benefits set forth in paragraph
4, you shall be generally available, upon reasonable notice, to assist the Corporation
with any matters with which you are personally familiar. In the event it is necessary
for you to provide the aforementioned services, then the Corporation shall reimburse
you for authorized, reasonable and documented travel expenses, including, but not
limited to, transportation, lodging and meals, but not including attorneys’ or other
professional fees incurred without the prior approval of the Nortel Networks
Corporation Chief Legal Officer; except that the Corporation acknowledges that
attorneys’ fees and associated expenses are reimbursable if the assistance you provide
is related to the subject matter of the Investigation and/or any Investigation
Indemnified Matter as defined below.
	 
	 	(f)	 	You have returned to the Corporation any and all property of the Corporation
that was in your possession and/or subject to your control, whether such

 

 

			
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	 	 	 	material shall be written instruments or tapes in electronic and/or recorded
format.
	 
	 	 	 	The Corporation’s Corporate Procedure 206.01 states that “all documents, messages
or data composed, sent, or received through the network of Nortel Networks in any
form are and remain at all times the property of Nortel Networks”. In addition,
all work product that you have produced during your employment with the Corporation
is the property of the Corporation. Therefore, all information, (however recorded
or stored) (“Information”) in your possession and/or that you have created in the
course of your employment with the Corporation (whether or not currently in your
possession or control) is the property of the Corporation. “Information” does not
include copies in your possession of your records of employment and/or financial
dealings between you and the Corporation.
	 
	 	 	 	You are aware that Nortel Networks has received a formal order of investigation
from the United States Securities and Exchange Commission (“SEC”) that requires the
preservation and collection and disclosure of certain Information to the SEC. The
Corporation is also a party to various civil lawsuits and other investigations and
may need access to certain Information for those matters as well. Therefore, you
took affirmative steps to preserve all Information in your possession, custody and
control (including information controlled by your assistant, if any), have left all
such Information in the possession and custody of the Corporation, and do not have
any Information in your possession or custody.
	 
	 	 	 	The Information will be used by the Corporation for general business purposes and
may also be provided by the Corporation to regulatory authorities in response to
their requests or disclosed in any relevant private litigation to which the
Corporation is a party. Also, the Information may be used by and provided to other
entities within the Nortel Networks group and/or the Corporation’s external
advisors. In some instances, the recipients of this Information will be located
outside your geographic area. To the extent that the Information contains any
personal information, you consent to the collection, transfer and disclosure of
that information by the Corporation to Nortel Networks entities, third parties and
regulatory authorities within and outside of your geographic area for the purposes
set out above.

 

 

			
	Mr. Pascal Debon

February 21, 2006

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	 	 	 	The commitments of this section 6(f) shall not apply to documents previously
furnished to your counsel in connection with the Investigation as defined below,
and you agree that you and your counsel shall use such Information solely for the
purpose of representing you in connection with Investigation Indemnified Matters as
defined below and not for any other purpose, without the express written consent of
the Corporation.
	 
	 	(g)	 	You hereby agree that you shall not during the Severance Period whether on
your own behalf or jointly with others, and whether as an employee, director,
principal, agent, consultant or in any other capacity in competition with the
Corporation, be directly or indirectly (i) employed or engaged in, or (ii) perform
services in respect of, or (iii) be otherwise concerned with:

	 	(i)	 	the research into, development, manufacture, supply or
marketing of any product which is of the same or substantially similar type to
any product researched, or developed, or manufactured, or supplied, or
marketed by the Corporation during the twelve months immediately preceding the
Employment Termination Date; or
	 
	 	(ii)	 	the development or provision of any services (including but
not limited to technical and product support, or consultancy or customer
services) which are of the same or substantially similar type to any services
provided by the Corporation during the twelve months immediately preceding the
Employment Termination Date;

	 	 	 	without the prior written consent of the Corporation, which consent shall not be
unreasonably withheld;
	 
	 	 	 	provided that, the provisions of this paragraph shall apply only in respect of
products or services with which you were either personally concerned or for which
you were responsible while employed by the Corporation during the twelve months
immediately preceding the Employment Termination Date; and
	 
	 	 	 	provided further that, the provisions of this paragraph shall not restrict you from
accepting employment with a company or other entity that provides products or
services that are in competition with products or services offered by the
Corporation, so long as you are not in the course of such employment during the
Severance Period involved in activities related to such competitive products or
services with which you were either personally concerned or for

 

 

			
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	 	 	 	which you were responsible while employed by the Corporation during the twelve
months immediately preceding the Employment Termination Date.
	 
	 	 	 	You hereby agree that you shall not for the Severance Period whether on your own
behalf or in conjunction with or, on behalf of any other entity, whether as an
employee, director, principal, agent, consultant or in any other capacity directly
or indirectly, for the purpose of providing or attempting to provide products or
services that compete with products or services offered by the Corporation as of
the Employment Termination Date, (i) solicit or, (ii) assist in soliciting, or
(iii) accept, or (iv) facilitate the acceptance of, or (v) deal with, customers or
prospective customers:

	 	(i)	 	with whom you had personal contact or dealings on behalf of
the Corporation during the twelve months immediately preceding the Employment
Termination Date; or
	 
	 	(ii)	 	for whom you were, in a client-management capacity on behalf
of the Corporation, directly responsible during the twelve months immediately
preceding the Employment Termination Date,

	 	 	 	without the prior written consent of the Corporation, which consent shall not be
unreasonably withheld.
	 
	 	 	 	You hereby agree that, you will not for the Severance Period either on your own
account or in conjunction with or on behalf of any other person, company, business
entity, or other organization and whether as an employee, principal, agent,
consultant or in any other capacity directly or indirectly (i) induce, or (ii)
solicit, or (iii) entice or (iv) procure, any person who is an employee of the
Corporation to leave the Corporation’s or any associated company’s employment (as
applicable) where that person is an employee of the Corporation on the Employment
Termination Date;
	 
	 	 	 	provided that, this provision shall neither (i) prohibit you from hiring, or
causing an organization for which you perform services to hire, any person who
initially approaches you and/or such organization to inquire about employment
without having been solicited by you to do so, nor (ii) be construed to apply to
the placement of general advertisements for employment on websites, in print
publications or in other appropriate media.

 

 

			
	Mr. Pascal Debon
February 21, 2006
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	 	(h)	 	You understand and agree that if you have the designation of either “Reporting” or
“Non-Reporting” Insider pursuant to Corporate Policy 320.28 of Nortel Networks
Corporation (and under applicable Canadian/US securities legislation for Reporting
Insiders), you will cease to have this designation effective on the Employment
Termination Date. Notwithstanding the fact that you no longer have this designation,
if you are in possession of material non-public information relating to Nortel
Networks, you are prohibited from trading in Nortel Networks securities (or informing
another person of the material non-public information) in accordance with applicable
laws. If you are a “Reporting” Insider, you understand that you were required to
amend your insider profile within 10 days of your Employment Termination Date on the
Canadian System for Electronic Disclosure by Insiders (SEDI) to indicate that you are
no longer a “Reporting” Insider of Nortel Networks. You should contact the Insider
Reporting Department at (905) 863-1220 and fax (905) 863-8524 for assistance in
amending the SEDI profile.

	7.	 	You agree to complete such documentation/forms and paperwork necessary to commence benefits
under paragraphs 4. or 5. of this Agreement. All company benefits not expressly extended to
you pursuant to and/or preserved by, this Agreement shall be terminated effective 12:01 a.m.,
on the day after the Employment Termination Date.
	 
	8.	 	Regardless of whether you comply with this Agreement:

	 	(a)	 	The Corporation shall indemnify you, and advance any reasonable legal fees
and expenses, to the extent permitted by, and in accordance with section 124 of the
Canada Business Corporations Act (the “CBCA”) and the Corporation’s By-Laws (the
“By-Laws”). You shall repay such fees and expenses if and to the extent it is
determined that you do not fulfill the conditions set forth in subsection 124(3) of
the CBCA or the By-Laws.
	 
	 	(b)	 	Subject to and without limiting the foregoing, the Corporation’s legal
counsel will represent you in respect of any civil, criminal, administrative,
investigative (including any internal investigation or independent review being
conducted by the Corporation’s Board of Directors or a Committee thereof) or other
proceeding in Canada, the United States or other applicable jurisdiction in which you
are involved (including as a witness) because of your association with the Corporation
(hereafter, a “Matter”). However, in the event that the Corporation’s counsel cannot
represent you in a Matter because of a conflict, the Corporation agrees to advance
monies to pay your reasonable

 

 

			
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	 	 	and actual legal expenses in that Matter provided you agree that you will not
settle the Matter, retain defense counsel or expert witnesses or consultants, or
incur any non-normal course defense costs without obtaining the Corporation’s prior
consent, which consent will not be unreasonably withheld.

	 	(c)	 	With respect to the subject matter of (1) the investigation being conducted
by the United States Securities and Exchange Commission (“SEC”) pursuant to formal
order of private investigation in In the Matter of Nortel Networks Corporation
(SEC File No. H-9799); (2) the related investigation being conducted by the
Ontario Securities Commission; and (3) any other investigation by any law enforcement
authority, governmental body or self-regulatory organization in connection with any
fact, circumstance, situation, transaction, event or other source of liability related
to the subject matter referenced in the immediately foregoing items (1) and (2) or
referenced in the Corporation’s October 23, 2003 8K filing with the SEC (all of the
foregoing, collectively, the “Investigation”), you have retained separate counsel
independent of any duty to the Corporation (Latham & Watkins LLP and Fasken Martineau
DuMoulin LLP) and the Corporation will continue to advance monies to pay your
reasonable legal fees and expenses associated with the Investigation and all
proceedings such as may arise from it (collectively, the “Investigation Indemnified
Matters”). For clarification, Investigation Indemnified Matters include civil
litigation of related subject matter. The Corporation acknowledges that the
requirement set forth in this paragraph not to settle any Matter without the
Corporation’s prior consent does not apply to any Investigation Indemnified Matters.
The Corporation’s determination to advance such reasonable legal fees and expenses is
subject to section 124 of the CBCA and the By-Laws and you shall repay such fees and
expenses if it is determined that you do not fulfill the conditions set forth in
subsection 124(3) of the CBCA or the By-Laws. The Corporation will also timely
provide to your counsel reasonable access to or copies of any and all documents you
generated and/or received during the time period covered by the Investigation, and/or
as are relevant to any Investigation Indemnified Matter, as your counsel reasonably
requests.

	9.	 	With the exception of the Application filed in Ontario Superior Court of Justice in the
matter of Indiana Electrical Workers Pension Trust Fund IBEW and Laborers 100 and 397 Pension
Fund v. Nortel Networks Corporation, the Corporation represents that it has no knowledge as of
February 21, 2006 of any claims or legal action in favor of the Corporation against you in any
forum, whether for legal, equitable or administrative relief, and further represents that it
has no present intention to bring

 

 

			
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February 21, 2006

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	 	 	any such claims. The Corporation further agrees that in the event the Corporation brings
any such legal action, other than to enforce the terms of this Agreement, the release of
claims given by you in paragraph 10. of this Agreement shall be null and void.

RELEASE

	10.	 	IN CONSIDERATION OF THE FOREGOING PAYMENTS AND BENEFITS DETAILED ABOVE, FOR WHICH YOU
WOULD OTHERWISE BE INELIGIBLE, YOU HEREBY FULLY AND UNCONDITIONALLY RELEASE AND FOREVER
DISCHARGE THE CORPORATION (EXCEPT FOR THE PROMISES AND COMMITMENTS CONTAINED OR PRESERVED
HEREIN) TO THE EXTENT PERMITTED BY LAW, FROM ANY AND ALL CLAIMS ARISING FROM OR CONNECTED WITH
THE EMPLOYEE’S EMPLOYMENT WITH THE CORPORATION OR THE TERMINATION THEREOF FOR SALARY,
INCENTIVE COMPENSATION, VACATION PAY, SEVERANCE PAY UNDER THE NORTEL NETWORKS EXECUTIVE
MANAGEMENT TEAM SEVERANCE ALLOWANCE PLAN, NORTEL NETWORKS ENHANCED SEVERANCE ALLOWANCE PLAN,
NORTEL NETWORKS CORPORATION SPECIAL RETENTION PLAN, COMMISSIONS, PENSION OR OTHER BENEFITS OR
OTHER COMPENSATION AND PERQUISITES AND ANY AND ALL REAL OR PRETENDED CLAIMS, CAUSES OF ACTION,
OR DEMANDS ARISING FROM OR CONNECTED WITH THE EMPLOYEE’S EMPLOYMENT WITH THE CORPORATION OR
THE TERMINATION THEREOF,
INCLUDING, WITHOUT LIMITATION, THOSE FROM RIGHTS UNDER ANY FEDERAL, STATE, AND LOCAL LAW,
INCLUDING, WITHOUT LIMITATION, THE WORKER ADJUSTMENT AND RETRAINING NOTIFICATION ACT
(“WARN”) AND THOSE PROHIBITING DISCRIMINATION ON ANY BASIS, INCLUDING SEX, AGE, RELIGION,
SEXUAL ORIENTATION, DISABILITY, RACE, NATIONAL ORIGIN, AS MAY BE PROHIBITED UNDER SUCH LAWS
AS THE AGE DISCRIMINATION ACT OF 1967, THE OLDER WORKERS BENEFIT PROTECTION ACT (OWBPA),
THE CIVIL RIGHTS ACT OF 1964, THE AMERICANS WITH DISABILITIES ACT, THE EQUAL PAY ACT AND
THE FAMILY AND MEDICAL LEAVE ACT, INCLUDING ANY AMENDMENTS TO THOSE LAWS (INCLUDING, BUT
NOT LIMITED TO, YOUR RIGHT TO MAKE A CLAIM IN YOUR OWN RIGHT OR THROUGH A SUIT BROUGHT BY
ANY THIRD PARTY ON YOUR BEHALF) OR ANY COMMON LAW CLAIMS ARISING FROM OR CONNECTED WITH THE
EMPLOYEE’S EMPLOYMENT WITH THE CORPORATION OR THE TERMINATION THEREOF OF ANY KIND,
INCLUDING, BUT NOT LIMITED TO, CONTRACT,

 

 

			
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TORT, AND PROPERTY RIGHTS INCLUDING, BUT NOT LIMITED TO, BREACH OF CONTRACT, FRAUD, DECEIT,
NEGLIGENCE, NEGLIGENT MISREPRESENTATION, DEFAMATION, NEGLIGENT SUPERVISION, BREACH OF
PRIVACY, MISREPRESENTATION, WRONGFUL TERMINATION, INVASION OF PRIVACY, INTENTIONAL OR
NEGLIGENT INFLICTION OF EMOTIONAL DISTRESS, BREACH OF FIDUCIARY DUTY, VIOLATION OF PUBLIC
POLICY AND ANY OTHER COMMON LAW CLAIM OF ANY KIND WHATSOEVER AS OF THE DATE OF THIS
AGREEMENT WHICH YOU EVER HAD OR NOW HAVE, DIRECTLY OR INDIRECTLY, BASED UPON ANY FACT,
MATTER, EVENT OR CAUSE, WHETHER KNOWN OR UNKNOWN, ARISING OUT OF OR RELATING TO YOUR
EMPLOYMENT BY THE CORPORATION AND YOUR SEPARATION THEREFROM, OR YOUR RELATIONSHIP WITH THE
CORPORATION OR THE TERMS OF ANY WRITTEN OR ORAL EMPLOYMENT ARRANGEMENTS OR THE LIKE THAT
YOU MAY HAVE ENTERED INTO WITH THE CORPORATION. THIS AGREEMENT MAY NOT BE USED TO
INTERFERE WITH YOUR RIGHT TO FILE A CHARGE OR PARTICIPATE IN AN INVESTIGATION OR PROCEEDING
CONDUCTED BY THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION OR ANY OTHER APPROPRIATE AGENCY.
HOWEVER, YOU UNDERSTAND AND AGREE THAT THE CORPORATION WILL USE THIS AGREEMENT AS A DEFENSE
TO ANY SUCH CHARGE YOU FILE, INVESTIGATION OR PROCEEDING IN WHICH YOU PARTICIPATE, OR
REMEDY WHICH YOU SEEK. YOU AGREE THAT THIS RELEASE SHALL BE BINDING UPON YOU AND YOUR
HEIRS, ADMINISTRATORS, REPRESENTATIVES, EXECUTORS, SUCCESSORS AND ASSIGNS, AND ITS
ENFORCEABILITY SHALL NOT BE CHALLENGED. YOU ACKNOWLEDGE THAT YOU HAVE READ THIS AGREEMENT
AND THAT YOU UNDERSTAND ALL OF ITS TERMS AND EXECUTE IT VOLUNTARILY WITH FULL KNOWLEDGE OF
ITS SIGNIFICANCE AND THE CONSEQUENCES THEREOF. FURTHER, YOU ACKNOWLEDGE THAT YOU HAVE HAD
AN ADEQUATE OPPORTUNITY TO REVIEW AND CONSIDER THE TERMS OF THIS AGREEMENT, INCLUDING AT
YOUR DISCRETION, THE RIGHT TO DISCUSS THIS AGREEMENT WITH LEGAL COUNSEL OF YOUR CHOICE.
YOU HEREBY ACKNOWLEDGE THAT YOU INTEND TO GRANT TO THE CORPORATION A FULL AND FINAL RELEASE
AS SET FORTH HEREIN. FINALLY, YOU UNDERSTAND AND AGREE THAT THE CORPORATION MAY DEDUCT
FROM ANY PAYMENT PROVIDED TO YOU UNDER THIS AGREEMENT ANY AMOUNTS (INCLUDING, BUT NOT
LIMITED TO, ANY ADVANCE, LOANS, OVERPAYMENT, TAX

 

 

			
	Mr. Pascal Debon

February 21, 2006

Page 14
	 	

EQUALIZATION PAYMENTS OR OTHER MONIES) THAT THE CORPORATION DETERMINES IN GOOD FAITH THAT
YOU OWE THE CORPORATION. IN THE EVENT THAT THE CORPORATION MAKES ANY DEDUCTIONS IN
ACCORDANCE WITH THE PRECEDING SENTENCE, THE CORPORATION SHALL PROMPTLY PROVIDE TO YOU, UPON
YOUR REQUEST, AN ACCOUNTING OF THE BASIS FOR THE DECISION AND THE AMOUNTS WITHHELD.

	11.	 	This Agreement constitutes the entire understanding of the parties with respect to your prior
employment, including termination thereof, and there are no promises, understandings or
representations other than those expressly set forth or preserved herein. This Agreement may
be modified only with a written instrument duly executed by you and the Corporation.
	 
	12.	 	This Agreement shall be governed by the laws of Texas without regard to any provisions
concerning conflict of laws. This Agreement may be delivered by facsimile and executed in
counterparts, all of which, taken together, shall constitute one and the same original
instrument.
	 
	13.	 	The parties agree that should any provision of this Agreement be declared or be determined by
any court to be illegal or invalid, the validity of the remaining parts, terms or provisions
shall not be affected thereby and said illegal or invalid part, term, or provision shall be
deemed not to be a part of this Agreement.
	 
	14.	 	Nothing in this Agreement shall be construed to prevent the Corporation from providing you or
your prospective employer, as applicable, with an appropriate positive reference or letter of
recommendation relating to your employment with the Corporation.
	 
	15.	 	Nothing in this Agreement shall affect the rights and obligations of any of the parties to
the Escrow Agreement, dated March 1, 2005, by and among the signatory Officers, Nortel
Networks Corporation, and Computershare Trust Company of Canada.
	 
	16.	 	This agreement may be executed in any number of counterparts and by the parties hereto in
separate counterparts, with the same effect as if each party had signed the same document.
All such counterparts shall be deemed an original, shall be construed together and shall
constitute one and the same instrument. Telecopied or scanned signature pages shall be deemed
an original and shall be sufficient to bind the parties to this Agreement.

 

 

			
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Page 15
	 	

Please acknowledge that the foregoing correctly and completely sets forth your understanding of the
arrangements and commitments, and your acceptance thereby, by signing, dating and returning this
Agreement to me.

Yours truly,

/s/ William J. Donovan

William J. Donovan

Senior Vice President,

Human Resources

IN WITNESS WHEREOF, intending to be legally bound, the parties have executed this Agreement as set
forth below.

	 	 	 	 	 
	 

	 	 	 	PLEASE INDICATE BELOW YOUR

ELECTIONS REGARDING:
	 
	 	 	 	 
	 

	 	•
	 	Insurance Benefits 
	 

	 	 	 	I elect the provisions of (CIRCLE ONE)

paragraph
4(b)(i) or 4(b)(ii)

	 	 	 	 	 
	 

	 	PD
 

	 	 
	 

	 	INITIALS	 	 

	 	 	 	 	 	 	 	 	 	 	 
	NORTEL NETWORKS INC.	 	 	 	PASCAL DEBON	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	/s/ William J. LaSalle	 	 	 	/s/ P. Debon	 	 
	 	 	 	 	 	 	 	 	 
	 
	Title:

	 	Secretary
	 	 	 	Date:

	 	22/Feb/06exv10w76

 

Exhibit 10.76

CONFIDENTIAL-SPECIAL HANDLING

February 21, 2006

Mr. Brian McFadden

6 Magnolia St.

Baie D’Urfe, PQ

H9X 3P4

Dear Brian:

This letter (“Agreement”) records the arrangements between you and Nortel Networks Limited
concerning the cessation of your employment. The Agreement shall bind and inure to the benefit of
each party and their respective heirs, successors and assigns.

	1.	 	As used in this Agreement, the term “Corporation” shall mean Nortel Networks Corporation, its
subsidiaries and affiliates, their successors and assigns, and all of their past and present
officers, directors, employees and agents (in their individual and representative capacities),
in every case, individually and collectively.
	 
	2.	 	Effective as of the close of business on December 23, 2005, your active employment
relationship with the Corporation ceased. All previous external responsibilities which you
had were or will be assumed by a person designated by the Corporation, including any
participation in industry or other associations representing the Corporation. You ceased to
act as an officer and/or director of the Corporation and any of the Corporation’s subsidiaries
and affiliates on December 23, 2005, and the Corporation has taken steps to remove you from
all such positions.
	 
	3.	 	You understand and agree that if you have the designation of either “Reporting” or
“Non-Reporting” Insider pursuant to Corporate Policy 320.28 of Nortel Networks Corporation
(and under applicable Canadian/US securities legislation for Reporting Insiders), you ceased
to have this designation effective 12:01 a.m. on December 24, 2005. Notwithstanding the fact
that you no longer have this designation, if you are in possession of material non-public
information relating to Nortel Networks, you are prohibited from trading in Nortel Networks
securities (or informing another person of the material non-public information) in accordance
with applicable laws. If you are a

William J. Donovan

Senior-Vice President

Human Resources

Nortel

8200 Dixie Road Suite 100 Brampton ON Canada L6T 5P6 T 905.863.1100 F 905.863.8412 E billdono@nortel.com

 

 

			
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Page 2
	 	

	 	 	“Reporting” Insider, you understand that you were required to amend your insider profile
within 10 days of December 23, 2005 on the Canadian System for Electronic Disclosure by
Insiders (SEDI) to indicate that you were no longer a “Reporting” Insider of Nortel
Networks. You should contact the Insider Reporting Department at (905) 863-1220 and fax
(905) 863-8524 for assistance in amending the SEDI profile.

	4.	 	Conditional upon your compliance with all terms and conditions of this Agreement, the
Corporation shall:

	 	(a)	 	pay you the sum of US$20,314.92 bi-weekly, converted to Canadian currency in
the same manner as you were paid immediately prior to the termination of your active
employment, less applicable deductions, commencing on December 24, 2005 and
terminating December 28, 2007 (“Salary Continuation Period”). The first such payment
shall be made on the Corporation’s next regular payroll date following your execution
of this Agreement and shall include all bi-weekly payments accrued to that date;
	 
	 	(b)	 	pay you, on or before the next regular payroll date following your execution
of this Agreement, a lump sum amount equivalent to ten (10) weeks of base salary
representing all of your current accrued but unused vacation benefit, with no further
vacation accrual subsequent to December 23, 2005;
	 
	 	(c)	 	continue your participation during the Salary Continuation Period, subject to
the provisions of the applicable plans, in group medical, life insurance and dental
insurance, for you and any of the dependents currently covered; you shall continue to
make any required contributions for such benefits at the rates applicable for senior
executive employees occupying positions similar to that you occupied in your most
senior position with the Corporation through the deductions authorized in paragraph
4(a);
	 
	 	(d)	 	continue your accrual of pensionable service during the Salary Continuation
Period, pursuant to the terms of the Nortel Networks Managerial and Non-Negotiated
Pension Plan (the “pension plan”); your final pension or retirement benefits will be
calculated based on pensionable service you have accrued to the conclusion of the
Salary Continuation Period;
	 
	 	(e)	 	consider you ineligible for consideration for any future grant(s) of stock
options or Restricted Stock Units (RSUs). Stock options and RSUs previously granted
to you will continue to vest during the Salary Continuation Period in

 

 

			
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February 21, 2006

Page 3
	 	

	 	 	 	accordance with the provisions of the plan under which the stock options or RSUs
were granted and the instrument of grant evidencing the grant. Your right, if any,
to exercise any vested Nortel Networks stock options or RSUs after your active
employment relationship with the Corporation ceased (including during the Salary
Continuation Period) will be determined in accordance with the provisions of the
stock option or RSU plan under which the stock options or RSUs were granted and the
instrument of grant evidencing the options or RSUs;
	 
	 	(f)	 	following your completion of the necessary documentation, distribute your
account balance in accordance with the provisions of the Nortel Networks Investment
Plan. Your right to contribute to and participate in the Investment Plan will cease
at the end of the Salary Continuation Period;
	 
	 	(g)	 	make available to you, should you elect, executive outplacement services to
assist you in securing new employment and pay the professional fees for such services
as are reasonably incurred;
	 
	 	(h)	 	with respect to any monies or monetary equivalents to be paid hereunder, in
its reasonable discretion withhold appropriate amounts concerning any and all
applicable federal and provincial taxes; and
	 
	 	(i)	 	pay the cost of personal income tax preparation by a service provider
selected by the Corporation for tax year 2005.

	5.	 	All Corporation compensation, benefits and perquisites not expressly extended to or preserved
for you pursuant to this Agreement shall be terminated effective 12:01 am., December 24, 2005.
	 
	6.	 	Regardless of whether you comply with this Agreement:

	 	(a)	 	The Corporation shall indemnify you, and advance any reasonable legal fees
and expenses, to the extent permitted by, and in accordance with, section 124 of the
Canada Business Corporations Act (the “CBCA”) and the Corporation’s By-Laws (the
“By-Laws”). You shall repay such fees and expenses if and to the extent it is
determined that you do not fulfill the conditions set forth in subsection 124(3) of
the CBCA or the By-Laws.

 

 

			
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February 21, 2006

Page 4
	 	

	 	(b)	 	Subject to and without limiting the foregoing, it is anticipated that the
Corporation’s legal counsel will represent you in respect of any civil, criminal,
administrative, investigative (including any internal investigation or independent
review being conducted by the Corporation’s Board of Directors or a Committee thereof)
or other proceeding in Canada, the United States or other applicable jurisdiction in
which you are involved (including as a witness) because of your association with the
Corporation (hereafter, a “Matter”). However, in the event that the Corporation’s
counsel cannot represent you in a Matter because of a conflict, the Corporation agrees
to advance monies to pay your reasonable and actual legal expenses in that Matter
provided you agree that you will not settle the Matter, retain defense counsel or
expert witnesses or consultants, or incur any non-normal course defense costs without
obtaining the Corporation’s prior consent, which consent will not be unreasonably
withheld.
	 
	 	(c)	 	With respect to the subject matter of (1) the investigation being conducted
by the United States Securities and Exchange Commission (“SEC”) pursuant to formal
order of private investigation in In the Matter of Nortel Networks Corporation (SEC
File No. H-9799); (2) the related investigation being conducted by the Ontario
Securities Commission; and (3) any other investigation by any law enforcement
authority, governmental body or self-regulatory organization in connection with any
fact, circumstance, situation, transaction, event or other source of liability related
to the subject matter referenced in the immediately foregoing items (1) and (2) or
referenced in the Corporation’s October 23, 2003 8K filing with the SEC (all of the
foregoing, collectively, the “Investigation”), you have retained separate counsel
independent of any duty to the Corporation (Latham & Watkins LLP and Fasken Martineau
DuMoulin LLP) and the Corporation will continue to advance monies to pay your
reasonable legal fees and expenses associated with the Investigation and all
proceedings such as may arise from it (collectively, the “Investigation Indemnified
Matters”). For clarification, Investigation Indemnified Matters include civil
litigation of related subject matter. The Corporation acknowledges that the
requirement set forth in this paragraph not to settle any Matter without the
Corporation’s prior consent does not apply to any Investigation Indemnified Matters.
The Corporation’s determination to advance such reasonable legal fees and expenses is
subject to section 124 of the CBCA and the By-Laws and you shall repay such fees and
expenses if it is determined that you do not fulfill the conditions set forth in subsection
124(3) of the CBCA or the By-Laws. The Corporation will also

 

 

			
	Mr. Brian McFadden

February 21, 2006

Page 5
	 	

timely provide to your counsel reasonable access to or copies of any and all documents you generated
and/or received during the time period covered by the Investigation, and/or as are
relevant to any Investigation Indemnified Matter, as your counsel reasonably
requests.

	7.	 	With the exception of the Application filed in the Ontario Superior Court of Justice in the
matter of Indiana Electrical Workers Pension Trust Fund IBEW and Laborers Local 100 and 397
Pension Fund v. Nortel Networks Corporation, the Corporation represents that it has no
knowledge as of February 21, 2006 of any claims or legal action in favor of the Corporation
against you in any forum, whether for legal, equitable or administrative relief, and further
represents that it has no present intention to bring any such claims. The Corporation further
agrees that in the event the Corporation brings any such legal action, other than to enforce
the terms of this Agreement, the release of claims given by the Employee in section 13 shall
be null and void.

	8.	 	You shall reconcile and settle your employee expense account, and any advances made to you by
the Corporation, as soon as possible, but not later than thirty (30) days after your execution
of this Agreement.

	9.	 	You shall continue to maintain the confidentiality of all of the Corporation’s trade secrets
and confidential or proprietary commercial, technical or other information; and specifically
you agree that you shall not at any time during or following your employment with the
Corporation, disclose, other than to the Corporation’s authorized personnel, or otherwise use
for non-Corporation purposes, any confidential or proprietary information (whether or not a
trade secret) relating to an activity of the Corporation.

The parties agree that this Agreement, and all the terms and conditions expressed herein,
is subject to either party’s right or obligation to disclose this Agreement in accordance
with applicable securities laws or as may be required to enforce this Agreement.

Upon the occurrence of any contingency which may affect your rights in or to any subsequent
payment or benefit, or affects the Corporation’s rights under this Agreement, including
without limitation, your obtaining new employment, you shall, within ten (10) days of such
occurrence, provide written notice to the Corporation of that event. Such notice shall be
sent in writing to the Senior Vice-President, Human Resources.

 

 

			
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	10.	 	You shall make available to the Corporation, upon reasonable notice, advice, assistance and
information that shall include, but not be limited to, offering and explaining evidence,
providing sworn statements, participation in discovery, and trial preparation testimony as may
be deemed necessary by the Corporation concerning the Corporation’s position in any legal
proceedings involving issues brought against or initiated by the Corporation of which you have knowledge. In the event
it is necessary for you to provide the aforementioned services, then the Corporation shall
reimburse you for authorized, reasonable and documented travel expenses, including, but not
limited to, transportation, lodging and meals; except that the Corporation acknowledges
that attorneys’ fees and associated expenses are reimbursable if the assistance you provide
is related to the subject matter of the Investigation or any Investigation Indemnified
Matter.

	11.	 	You have returned to Nortel Networks any and all property of Nortel Networks that was in your
possession and/or subject to your control, whether such material shall be written instruments
or tapes in electronic and/or recorded format.

Nortel Networks Corporate Procedure 206.01 states that “all documents, messages or data
composed, sent, or received through the network of Nortel Networks in any form are and
remain at all times the property of Nortel Networks”. In addition, all work product that
you have produced during your employment with Nortel Networks is the property of Nortel
Networks. Therefore, all information, (however recorded or stored) (“Information”) in your
possession and/or that you have created in the course of your employment with Nortel
Networks (whether or not currently in your possession or control) is the property of Nortel
Networks. Information does not include copies in your possession of your records of
employment and/or financial dealings between you and the Corporation.

You are aware that Nortel Networks has received a formal order of investigation from the
United States Securities and Exchange Commission (“SEC”) that requires the preservation and
collection and disclosure of certain Information to the SEC. Nortel Networks is also a
party to various civil lawsuits and other investigations and may need access to certain
Information for those matters as well. Therefore, you took affirmative steps to preserve
all information in your possession, custody and control (including information controlled
by your assistant, if any), have left all such information in the possession and custody of
the Corporation, and do not have any Information in your possession or custody.

The Information will be used by Nortel Networks for general business purposes and may also be
provided to regulatory authorities in response to their requests or

 

 

			
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Page 7
	 	

	 	 	disclosed in any relevant private litigation to which Nortel Networks is a party. Also,
the Information may be used by and provided to entities within the Nortel Networks group of
companies and/or Nortel Networks external advisors. In some instances, the recipients of
this Information will be located outside your geographic area. To the extent that the
information contains any personal information, you consent to the collection, transfer and
disclosure of that information by Nortel Networks to Nortel Networks entities, third
parties and regulatory authorities within and outside of your geographic area for the
purposes set out above.
	 
	 	 	The commitments of this section 11 shall not apply to documents previously furnished to
your counsel in connection with the Investigation, and you agree that you and your counsel
shall use such Information solely for the purpose of representing you in connection with
Investigation Indemnified Matters and not for any other purpose, without the express
written consent of the Corporation.
	 
	12.	 	You hereby agree that you shall not during the Salary Continuation Period whether on your own
behalf or jointly with others, and whether as an employee, director, principal, agent,
consultant or in any other capacity in competition with the Corporation, be directly or
indirectly (i) employed or engaged in, or (ii) perform services in respect of, or (iii) be
otherwise concerned with:

	 	 (i)	 	the research into, development, manufacture, supply or marketing of any
product which is of the same or substantially similar type to any product researched,
or developed, or manufactured, or supplied, or marketed by the Corporation during the
twelve months immediately preceding December 23, 2005; or
	 
	 	 (ii)	 	the development or provision of any services (including but not limited to
technical and product support, or consultancy or customer services) which are of the
same or substantially similar type to any services provided by the Corporation during
the twelve months immediately preceding December 23, 2005;

	 	 	without the prior written consent of the Corporation, which consent shall not be
unreasonably withheld;
	 
	 	 	provided that, the provisions of this paragraph shall apply only in respect of products or
services with which you were either personally concerned or for which you were

 

 

			
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Page 8
	 	

	 	 	responsible while employed by the Corporation during the twelve months immediately
preceding December 23, 2005; and
	 
	 	 	provided further that, the provisions of this paragraph shall not restrict you from
accepting employment with a company or other entity that provides products or services that
are in competition with products or services offered by the Corporation, so long as you are
not in the course of such employment during the Salary Continuation Period involved in
activities related to such competitive products or services with which you were either
personally concerned or for which you were responsible while employed by the Corporation
during the twelve months immediately preceding December 23, 2005.
	 
	 	 	You hereby agree that you shall not for the Salary Continuation Period whether on your own
behalf or in conjunction with or, on behalf of any other entity, whether as an employee,
director, principal, agent, consultant or in any other capacity directly or indirectly, for
the purpose of providing or attempting to provide products or services that compete with
products or services offered by the Corporation as of December 23, 2005, (i) solicit or,
(ii) assist in soliciting, or (iii) accept, or (iv) facilitate the acceptance of, or (v)
deal with, customers or prospective customers:

	 	(i)	 	with whom you had personal contact or dealings on behalf of the Corporation
during the twelve months immediately preceding December 23, 2005; or
	 
	 	(ii)	 	for whom you were, in a client-management capacity on behalf of the
Corporation, directly responsible during the twelve months immediately preceding
December 23, 2005,

	 	 	without the prior written consent of the Corporation, which consent shall not be
unreasonably withheld.
	 
	 	 	You hereby agree that, you will not for the Salary Continuation Period either on your own
account or in conjunction with or on behalf of any other person, company, business entity,
or other organization and whether as an employee, principal, agent, consultant or in any
other capacity directly or indirectly (i) induce, or (ii) solicit, or (iii) entice or (iv)
procure, any person who is an employee of the Corporation to leave the Corporation’s or any
associated company’s employment (as applicable) where that person is an employee of the
Corporation on December 23, 2005;

 

 

			
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Page 9
	 	

	 	 	provided that, this provision shall neither (i) prohibit you from hiring, or causing an
organization for which you perform services to hire, any person who initially approaches
you and/or such organization to inquire about employment without having been solicited by
you to do so, nor (ii) be construed to apply to the placement of general advertisements for
employment on websites, in print publications or in other appropriate media.
	 
	13.	 	In consideration of the monies and other benefits to be provided to you as set forth herein,
you hereby fully and completely release the Corporation, its subsidiaries and affiliates, and
their respective directors, officers and employees, to the extent permitted by law, from any
and all real or pretended claims, causes of actions, rights, damages or injuries of any nature
whatsoever you may have had or now have, whether known or unknown, (except for promises and
commitments contained or preserved herein), arising from or connected with your employment
with the Corporation or the termination thereof, including any and all such claims, causes of
action, rights, damages or injuries arising under any statute, including, without limitation,
the Labour Standards Act (An Act Respecting Labour Standards (Quebec)) or at common law.
Furthermore, you understand that this release shall be binding upon you and your heirs,
administrators, representatives, executors, successors, and assigns and its enforceability
shall not be challenged.
	 
	 	 	You acknowledge that you have read this letter and that you understand all of its terms and
have executed it voluntarily with full knowledge of its significance. Further, you
acknowledge that you have had an adequate opportunity to review and consider the
arrangements, including at your discretion, the right to discuss this Agreement with legal
counsel of your choice. Finally, you acknowledge that you understand you are hereby
granting to the Corporation a full and final release as set forth above.
	 
	14.	 	This Agreement constitutes the entire understanding of the parties with respect to your
employment, including the cessation of your employment, and there are no promises,
understandings or representations other than those expressly set forth or preserved herein.
This Agreement may be modified only with a written instrument duly executed by you and the
Corporation.
	 
	15.	 	This Agreement shall be governed by the laws of Ontario, Canada without regard to any
provisions concerning conflict of laws. This Agreement may be delivered by facsimile and
executed in counterparts, all of which, taken together, shall constitute one and the same
original instrument.

 

 

			
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Page 10
	 	

	16.	 	The parties agree that should any provision of this Agreement be declared or be determined by
any court to be illegal or invalid, the validity of the remaining parts, terms or provisions
shall not be affected thereby and said illegal or invalid part, term, or provision shall be
deemed not to be a part of this Agreement.
	 
	17.	 	Nothing in this Agreement shall be construed to prevent the Corporation from providing you or
your prospective employer, as applicable, with an appropriate positive reference or letter of
recommendation relating to your employment with the Corporation.
	 
	18.	 	Nothing in this Agreement shall affect the rights and obligations of any of the parties to
the Escrow Agreement, dated March 1, 2005, by and among the signatory Officers, Nortel
Networks Corporation, and Computershare Trust Company of Canada.

Please acknowledge that the foregoing correctly and completely sets forth your understanding of the
arrangements, and your acceptance hereof, by signing, dating and returning to me, the attached
second copy of this Agreement.

Yours truly,

/s/ William J. Donovan

William J. Donovan

Senior Vice-President, Human Resources

	 	 	 
	     /s/ B. McFadden
	 	 
	 

Brian McFadden

	 	  
	 
	 	 
	     February 22, 2006
	 	 
	 

Date

	 	  

Attach. Second copy of this Agreement

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