greater of Canadian $2.50 per common share and 95 percent of the
Prepaid forward purchase contracts
On June 12, 2002, concurrent with Nortel Networks Corporation common share offering, 28,750 equity units were offered, each initially evidencing its holder’s ownership of a prepaid forward purchase contract (“purchase contract”), entitling the holder to receive Nortel Networks Corporation common shares and specified
The settlement date for each remaining purchase contract is August 15, 2005, subject to acceleration or early settlement in certain cases. As of December 31, 2003, the aggregate number of Nortel Networks Corporation common shares issuable on the settlement date will be between approximately 164 million and 196 million shares, subject to certain
•greater than $1.692 per share, 16,885.93 common shares will be issued and delivered for each purchase contract;
•less than or equal to $1.692 per share but greater than $1.410 per share, the number of common shares to be issued and delivered for each purchase contract will be equal to $28,571.00 divided by the applicable market value; and
•less than or equal to $1.410 per share, 20,263.12 common shares will be issued and delivered for each purchase contract.
A holder of purchase contracts may elect to accelerate the settlement date in respect of some or all of its purchase contracts. Upon an early settlement on or after August 15, 2002 and prior to February 15, 2003, the holder was entitled to receive 16,011.04 Nortel Networks Corporation common shares per purchase contract (regardless of the market price of Nortel Networks Corporation common shares at that time), subject to certain
If Nortel Networks is involved in a merger, amalgamation, arrangement, consolidation or other reorganization event (other than with or into NNL or certain other subsidiaries) in which all of its common shares are exchanged for consideration of at least 30 percent of the value of which consists of cash or cash equivalents, then a holder of purchase contracts may elect to accelerate and settle some or all of its purchase contracts for Nortel Networks Corporation common shares.
The settlement date under each purchase contract will automatically accelerate upon occurrence of specified events of bankruptcy, insolvency or reorganization with respect to Nortel Networks. Upon acceleration of the settlement date, holders will be entitled to receive 20,263.12 Nortel Networks Corporation common shares per purchase contract (regardless of the market price of Nortel Networks Corporation common shares at that time), subject to certain