Avaya 2023 Bankruptcy - PBGC Agreement w/ Avaya

[remberger]

Exhibit I PBGC Settlement

This Settlement Agreement (this “Settlement Agreement”) is made between Avaya Holdings Corp, and its U.S. subsidiaries (collectively, the “Company”) and Pension Benefit Guaranty Corporation (“PBGC”). The Company and PBGC (each, a “Party” and collectively, the “Parties”) hereby agree as follows:

A. PBGC is a wholly-owned United States government corporation and agency created to administer and enforce the pension termination insurance program under Title IV ofthe Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

B. Each Company entity is either the contributing sponsor or a member of the contributing sponsor’s controlled group, each as defined in 29 U.S.C. § 1301(a)(13), (14), of the Avaya Inc. Pension Plan (the “Hourly Pension Plan”), a defined benefit plan covered by the termination insurance program under Title IV of ERISA.

C. PBGC alleges the Company and its affiliates organized and located outside the United States (collectively, the “Avaya Entities”) are each members of Avaya’s controlled group as described in 29 U.S.C. § 1301 (a)(14).

D. Certain Company entities and PBGC are parties to that First Amended and Restated Stipulation of Settlement Pursuant to Sections 105 and 363 of the United States Bankruptcy Code and Rule 9019 of the Federal Rules of Bankruptcy Procedure Between the Debtors and Pension Benefit Guaranty Corporation (the “Stipulation”), approved by the United States Bankruptcy Court for the Southern District of New York on November 27, 2017, pursuant to the Order Approving Stipulation ofSettlement -with Pension Benefit Guaranty Corporation and Granting RelatedRelief (the “Stipulation Order”).

E. The Company anticipates filing petitions for relief under title 11 of the United States Code, 11 U.S.C. §§ 101-1532 (the “Petitions”), in the United States Bankruptcy Court for the Southern District ofTexas (the “Bankruptcy Court”). In advance ofthe anticipated chapter 11 cases, the Company, certain ad hoc groups of its lenders, and PBGC have engaged in extensive good-faith negotiations regarding the treatment of the Stipulation, this Settlement Agreement, and the Hourly Pension Plan.

NOW, THEREFORE, it is hereby agreed to by and among the Parties:

1 • Approval. The Company shall seek entry of an order by the Bankruptcy Court approving this Settlement Agreement and the terms set forth herein (the “Settlement
Approval Order”); provided that such approval may be sought in connection with confirmation of the Plan (as defined herein) and the Settlement Approval Order may be the order confirming the Plan. This Settlement Agreement shall be effective on the date the Bankruptcy Court enters the Settlement Approval Order. Although the Parties shall sign this Settlement Agreement prior to the Company filing the Petitions, this Settlement Agreement shall not be binding on the Parties if the Settlement Approval Order is not entered by the Bankruptcy Court.

2. Hourly Pension Plan. The Company shall seek confirmation of a plan of reorganization (the “Plan”) by the Bankruptcy Court that provides for the reorganized Company (the “Reorganized Company”) to maintain and sponsor the Hourly Pension Plan in compliance with ERISA and the Internal Revenue Code of 1986, as amended, on the effective date ofthe Plan. It shall be a condition to the effective date of the Plan that the Hourly Pension Plan shall continue in effect on the effective date of the Plan.

3. Stipulation. The Stipulation shall be deemed terminated and rejected by the Company as of the date of entry of the Settlement Approval Order, and the terms therein (including
any Excess Contribution (as defined in the Stipulation) requirements set forth therein) shall be of no further force and effect thereafter and shall no longer be binding on the Reorganized Company and PBGC. If the Company complies with paragraph 2, PBGC shall not prosecute any claims in connection with such termination and rejection, including any claims for Excess Contribution (as defined in the Stipulation) (a “Rejection Claim”); provided that PBGC may file a Rejection Claim in the event the Bankruptcy Court enters an order establishing a bar date by which proofs of claim must be filed and such bar date is prior to emergence, and any Rejection Claim shall be deemed withdrawn with prejudice and expunged without further action by any party upon the Reorganized Company’s emergence from chapter 11 and satisfaction ofthe terms ofthis Settlement Agreement.

4. Notice. All notices, demands, instructions, and other communications required or permitted under the Settlement Agreement to any Party (a “Notice”) must be in writing, will be effective upon receipt, and must be delivered by hand delivery or overnight courier and email and, in the case of any Notice to PBGC, by submission using PBGC’s e-Filing Portal in the manner provided below. Unless otherwise specified in a Notice sent or delivered in a manner indicated below, Notices must be sent to the Parties as indicated below:
If to the Company:
Avaya Holdings Corp.
350 Mt. Kemble
Morristown, NJ 07960
Attn: Vito Carnevale, General Counsel Email: vcarnevale@avaya.com
with a copy to:
Kirkland & Ellis LLP
601 Lexington Avenue
New York, New York 10022
Attention: Joshua A. Sussberg, P.C., Aparna Yenamandra, and Rachael Bentley Telephone: (212) 446-4800
Facsimile: (212) 446-4900
Email: jsussberg@kirkland.com; apama.yenamandra@kirkland.com;
rachael.bentley@kirkland.com and
Kirkland & Ellis LLP
300 N. LaSalle Street
Chicago, Illinois 60654
Attention: Patrick J. Nash, Jr. P.C. Telephone: (312) 862-2000 Facsimile: (312) 862-2200
Email: patrick.nash@kirkland.com
If to PBGC:
PBGC’s e-Filing Portal at https://efilingportal.pbgc.gov/ in accordance with the instructions therein
and
Pension Benefit Guaranty Corporation
Corporate, Finance, and Restructuring Department 445 12th Street S.W.
Washington, D.C. 20024
Attn: Director, CFRD
Email: SAcompliance@pbgc.gov
with a copy to:
Pension Benefit Guaranty Corporation Office of the General Counsel
12th Street S.W.
Washington, D.C. 20024
Attn: Cassandra C. Burton
Email: burton.cassandra@pbgc.gov Telephone: (202) 229-6778

5. Termination. Unless otherwise agreed in writing by the Parties, if the Company files a plan of reorganization or seeks to modify a Plan with terms that are inconsistent in any material respect with this Settlement Agreement, this Settlement Agreement shall terminate automatically, and shall be null and void ab initio without any further action by any Party. It is understood and agreed by the Parties that no claims and/or damages shall arise from the
termination of this Settlement Agreement in accordance with the preceding sentence, provided, that, if this Settlement Agreement is terminated, all Parties' rights and remedies with respect to the Stipulation and the Hourly Pension Plan shall be restored.

6. Governing Law. This Settlement Agreement, and any disputes related thereto, shall be governed by and be construed in accordance with (a) applicable federal law, or
(b) to the extent federal law does not apply, the laws of the state of New York without regard to the rule of conflict of laws of the state of New York or any other jurisdiction that would require the application of the law of another jurisdiction. The Parties hereto consent to submit to the jurisdiction of the appropriate federal district court for any litigation relating to this Settlement Agreement and agree not to commence any litigation relating to this Settlement Agreement except in the appropriate federal district court.

7. Authority. Each of the Parties hereto represents and warrants that it has the authority to enter into this Settlement Agreement and to undertake the transactions contemplated hereunder.

8. Successors and Assigns. The rights and obligations of each of the Parties under this Settlement Agreement shall be binding upon, and inure to the benefit of, any successor or assign of each such Party.




Agreed To And Accepted This
Avaya CALA Inc.
Avaya Cloud Inc.
Avaya EMEA Ltd.
Avaya Federal Solutions, Inc. Avaya Holdings Corp.
Avaya Holdings LLC
Avaya Inc.
Avaya Integrated Cabinet Solutions LLC Avaya Management L.P. by its general partner, Avaya Inc.
Avaya Management Services Inc.
Avaya World Services Inc.
CAAS Technologies, LLC
CTIntegrations, LLC
HyperQuality II, LLC
HyperQuality Inc.
Intellisist, Inc., dba Spoken Communications KnoahSoft, Inc.
Sierra Asia Pacific Inc.
Sierra Communication International LLC Ubiquity Software Corporation
VPNet Technologies, Inc.
—
Name: Eric Koza
Title: Chief Restructuring Officer
Day Of February, 2023:
[SIGNA TORE PAGE TO SETTLEMENTAGREEMENT}
Pension Benefit Guaranty Corporation
Date: 2023.02.06 19:23:36 -05'00'
Digitally signed by STEPHANIE STEPHANIE THOMAS thomas
By: Name: Stephanie Thomas
Title: Assistant General Counsel

[ttatgenhorst]

So here we go again. File bankruptcy, delete the shareholders, discharge a bunch of debt and start over. With revenue of $2.77 Billion, debt of $5.463 Billion, an enterprise value of $2.77 Billion a new agreement with Ring Central the phoenix will rise again. Avaya now has a total market cap of $23.9 Million so they will be easy pickings if somebody wants to buy them (assuming they get rid of most of their debt). Thank you Silver Lake Partners and TPG for destroying a wonderful company.

[rpuckett23]

good point Ted

those boys started the fall of a great company

enjoy the upcoming spring/summer