NORTEL SELECTS CIENA AS SUCCESSFUL BIDDER FOR OPTICAL NETWORKING AND CARRIER ETHERNET BUSINESSES

NORTEL SELECTS CIENA AS SUCCESSFUL BIDDER FOR OPTICAL NETWORKING AND CARRIER ETHERNET BUSINESSES

November 23, 2009

Ciena emerges as winning bidder with a purchase price of US$530 million in cash plus US$239 million principal amount of convertible notes

A minimum of 2,000 Nortel employees will be offered the opportunity to continue their work at Ciena

U.S. and Canadian court approvals of sale will be sought at a joint hearing on December 2, 2009
U.S. and Canadian antitrust clearance for the sale already obtained

TORONTO - Nortel* Networks Corporation [OTC: NRTLQ] announced that it, its principal operating subsidiary Nortel Networks Limited (NNL), and certain of its other subsidiaries, including Nortel Networks Inc. and Nortel Networks UK Limited (in administration), have concluded a successful auction of substantially all of the assets of Nortel's global Optical Networking and Carrier Ethernet businesses. Ciena Corporation (Ciena) has emerged as the winning bidder with a purchase price of US$530 million in cash plus US$239 million principal amount of convertible notes due June 2017.

The sale is subject to court approvals in the U.S. and Canada, which Nortel will seek at a joint hearing on December 2, 2009, and in France and Israel. The sale is also subject to certain regulatory approvals, information and consultation with employee representatives and/or employees in certain EMEA jurisdictions, other customary closing conditions and certain post-closing purchase price adjustments. U.S. and Canadian antitrust clearance for the sale has already been obtained. Nortel will work diligently with Ciena with a target to close the sale in the first quarter of 2010, subject to the timing of obtaining other regulatory approvals.

If approved by the courts, Ciena's purchase will include substantially all product platforms, patents and intellectual property that are predominantly used in the businesses, and provides for the transition of substantially all of Nortel's Optical Networking and Carrier Ethernet customer contracts to Ciena.

A minimum of 2,000 Nortel employees will receive offers of employment from Ciena, which currently represents more than 85 percent of the global Optical Networking and Carrier Ethernet employee base. This includes those employees assigned to the Optical Networking and Carrier Ethernet businesses in certain EMEA jurisdictions who will transfer automatically to Ciena by operation of law.

“Uniting our two optical businesses is a game changing event for the optical industry, creating a leader that has the end-to-end portfolio, industry innovation leadership, and significant global customer base to succeed in today's highly competitive market,” said Philippe Morin, president, Metro Ethernet Networks, Nortel. “Ciena's commitment to the future of our product platforms, customers and employees represents an exceptionally positive outcome to a challenging journey that started over a year ago. Our employees have always been the core value of our business, and their ability to continue to innovate as part of a global industry leader is one of the most satisfying results of today's news.”

“Nortel's Optical and Carrier Ethernet assets are well-respected in the industry, as evidenced by strong customer relationships across the globe,” said Gary Smith, president and CEO of Ciena. “By combining these assets with Ciena's existing resources, our collective customer base will be able to rely on one of the largest and most innovative companies strategically focused on converged Ethernet networking.

As previously announced, Nortel does not expect that the Company's common shareholders or the NNL preferred shareholders will receive any value from the creditor protection proceedings and expects that the proceedings will result in the cancellation of these equity interests.