Nortel

Nortel

March 15, 2005 16:09 ET

Nortel Announces New Waiver from Export Development Canada


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: NORTEL

NYSE, TSX SYMBOL: NT

MARCH 15, 2005 - 16:09 ET

Nortel Announces New Waiver from Export Development
Canada

TORONTO--(CCNMatthews - Mar 15, 2005) -

Nortel Networks Corporation (NYSE:NT)(TSX:NT) today announced that its
principal operating subsidiary, Nortel Networks Limited ("NNL"), has
obtained a new waiver from Export Development Canada ("EDC") of certain
defaults and related breaches by NNL under its performance-related
support facility with EDC (the "EDC Support Facility"). NNL's prior
waiver from EDC under the EDC Support Facility, previously announced on
February 15, 2005, was set to expire on March 15, 2005.

The new waiver from EDC will remain in effect until the earlier of
certain events including:

-- the date on which the Company and NNL's respective Q3 2004 Quarterly
Reports on Form 10-Q (the "Third Quarter Reports") and 2004 Annual
Reports on Form 10-K (the "2004 Annual Reports") have been filed with
the United States Securities and Exchange Commission (the "SEC"); or

-- April 30, 2005.

If the Company and NNL fail to file the Third Quarter Reports and the
2004 Annual Reports (collectively, the "Reports") with the SEC by April
30, 2005, EDC will have the right (absent a further waiver, the receipt
or terms of which cannot be assured), to terminate the EDC Support
Facility, exercise certain rights against collateral or require NNL to
cash collateralize all existing support. In addition, the related
breaches will not be cured by the filing of the Reports. Accordingly,
beginning on the earlier of the date upon which the Company and NNL file
the Reports with the SEC and April 30, 2005, EDC will have the right to
terminate or suspend the EDC Support Facility notwithstanding the filing
of the Reports. While NNL intends to seek a permanent waiver from EDC in
connection with the related breaches, the receipt or terms of any such
waiver cannot be assured.

The EDC Support Facility provides up to US$750 million in support, all
presently on an uncommitted basis. The US$300 million revolving small
bond sub-facility of the EDC Support Facility will not become committed
support until all of the Reports are filed with the SEC and NNL obtains
a permanent waiver of the Related Breaches. As of March 14, 2005, there
was approximately US$239 million of outstanding support utilized under
the EDC Support Facility, approximately US$170 million of which was
outstanding under the small bond sub-facility.

About Nortel

Nortel is a recognized leader in delivering communications capabilities
that enhance the human experience, ignite and power global commerce, and
secure and protect the world's most critical information. Serving both
service provider and enterprise customers, Nortel delivers innovative
technology solutions encompassing end-to-end broadband, Voice over IP,
multimedia services and applications, and wireless broadband designed to
help people solve the world's greatest challenges. Nortel does business
in more than 150 countries. For more information, visit Nortel on the
Web at www.nortel.com. For the latest Nortel news, visit
www.nortel.com/news.

Certain information included in this press release is forward-looking
and is subject to important risks and uncertainties. The results or
events predicted in these statements may differ materially from actual
results or events.

Factors which could cause results or events to differ from current
expectations include, among other things: the outcome of regulatory and
criminal investigations and civil litigation actions related to Nortel's
restatements and the impact any resulting legal judgments, settlements,
penalties and expenses could have on Nortel's results of operations,
financial condition and liquidity; the findings of Nortel's independent
review and implementation of recommended remedial measures; the outcome
of the independent review with respect to revenues for specific
identified transactions, which review will have a particular emphasis on
the underlying conduct that led to the initial recognition of these
revenues; the restatement or revisions of Nortel's previously announced
or filed financial results and resulting negative publicity; the
existence of material weaknesses in Nortel's internal controls over
financial reporting; the impact of Nortel's and NNL's failure to timely
file their financial statements and related periodic reports, including
breach of its support facility and public debt obligations and Nortel's
inability to access its shelf registration statement filed with the
United States Securities and Exchange Commission ("SEC"); ongoing SEC
reviews, which may result in changes to our public filings; the
potential delisting or suspension of Nortel's and NNL's publicly traded
securities; the impact of management changes, including the termination
for cause of Nortel's former CEO, CFO and Controller in April 2004; the
sufficiency of Nortel's restructuring activities, including the work
plan announced on August 19, 2004 as updated on September 30, 2004,
including the potential for higher actual costs to be incurred in
connection with restructuring actions compared to the estimated costs of
such actions;

cautious or reduced spending by Nortel's customers; fluctuations in
Nortel's operating results and general industry, economic and market
conditions and growth rates; fluctuations in Nortel's cash flow, level
of outstanding debt and current debt ratings; Nortel's ability to
recruit and retain qualified employees; the use of cash collateral to
support Nortel's normal course business activities; the dependence on
Nortel's subsidiaries for funding; the impact of Nortel's defined
benefit plans and deferred tax assets on results of operations and
Nortel's cash flow; the adverse resolution of class actions, litigation
in the ordinary course of business, intellectual property disputes and
similar matters; Nortel's dependence on new product development and its
ability to predict market demand for particular products; Nortel's
ability to integrate the operations and technologies of acquired
businesses in an effective manner; the impact of rapid technological and
market change; the impact of price and product competition; barriers to
international growth and global economic conditions, particularly in
emerging markets and including interest rate and currency exchange rate
fluctuations; the impact of rationalization in the telecommunications
industry; changes in regulation of the Internet; the impact of the
credit risks of Nortel's customers and the impact of customer financing
and commitments; stock market volatility generally and as a result of
acceleration of the settlement date or early settlement, which is
currently not available, of Nortel's forward purchase contracts; the
impact of Nortel's supply and outsourcing contracts that contain
delivery and installation provisions, which, if not met, could result in
the payment of substantial penalties or liquidated damages; and the
future success of Nortel's strategic alliances.

For additional information with respect to certain of these and other
factors, see the most recent Annual Report on Form 10-K and Quarterly
Report on Form 10-Q filed by Nortel with the SEC. Unless otherwise
required by applicable securities laws, Nortel disclaims any intention
or obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise.

Nortel, the Nortel logo and the Globemark are trademarks of Nortel.

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