We End Up Seen As Legacy Liabilities

To: NRLN Avaya Retirees Chapter Members      October 11, 2017

Hello Avaya Chapter members or maybe I should say: Hello legacy liabilities.

It is sad that after all our years of faithful service we end up in the eyes of Avaya and the current Avaya owners the main secured creditors as legacy liabilities.

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Avaya Settlement Approval Sought

“Avaya filed with the U.S. Bankruptcy Court a motion seeking entry of an order
(a) approving a settlement with Pension Benefit Guaranty Corporation (PBGC) and
(b) making the determination required for distress termination of the Avaya Pension Plan for the salaried employees.
The motion notes, "The treatment of the Avaya Pension Plan for Salaried Employees (the 'Salaried Pension Plan') and the Avaya Pension Plan (the 'Hourly Pension Plan,' and with the Salaried Pension Plan, the 'U.S. Qualified Pension Plans') has remained a critical item for the Debtors' creditor groups.
In particular, each of the Ad Hoc First Lien Group and the Ad Hoc Crossover Group (together, the 'Ad Hoc Creditor Groups') have made clear that their support for any restructuring plan would be conditioned on the Debtors also obtaining material concessions with respect to their legacy liabilities - and the Salaried Pension Plan, in particular….
The Stipulation of Settlement also settles the $1.2 billion of asserted claims resulting from the termination of the Salaried Plan on terms that significantly aid the Debtors' reorganization efforts without prolonged litigation."
The motion continues, "The Stipulation of Settlement resolves the resulting liabilities against the controlled group by providing for a cash distribution of $300 million and the issuance to PBGC of 7.5% of the equity of the Reorganized Debtors upon the Effective Date of the Debtors' Amended Plan….
The Stipulation of Settlement also provides that the Reorganized Debtors will continue to sponsor the Hourly Pension Plan with certain additional post-emergence protections. Those protections may require the Reorganized Debtors to contribute up to $150 million to the Hourly Pension Plan on a post-Effective Date basis in connection with the occurrence of certain 'Material Transactions.'" The Court scheduled a November 15, 2017 hearing to consider the motion, with objections due by November 1, 2017.”

Other News:
We have about 2 weeks remaining to cast our votes to accept or reject the First Amended Joint Chapter 11 plan, the Pink Ballots must be completed executed and delivered before the Voting Deadline to the Notice and Claims Agent before 5 PM prevailing Eastern Time. If you mail your ballot you can use the pre-paid enclosed envelope.
Many of us have received objections to some of our claims for various reasons, amended claims that were subsequently filed is one that many have received because they disallowed and expunged the first claim and left the amended surviving claim in place.
Stay tuned for many more claims being disallowed because Avaya and the First Amended Plan still states and was also affirmed this week by one of the Avaya Kirkland and Ellis Bankruptcy attorneys that if the Plan is ultimately approved in court they, Avaya Reorganized (the Debtors), will maintain the OPEB’s (Other Pension Employee Benefits) in accordance with, and subject to, their terms and applicable non-bankruptcy law, or even modify the OPEB’s in compliance with applicable non-bankruptcy law and the Reorganized Debtors reserve all of their rights thereunder.
As I see this, it means the company can also modify the Benefits as long as they follow non-bankruptcy laws after they emerge out of bankruptcy.  I would expect that if they retain the present benefits, including Life Insurance. Then all of claims for possible loss of life insurance will be a moot point and disallowed. This helps cleaning up the docket to exit bankruptcy.

Open Enrollment Reminder for Hourly Represented Employees
Also, Avaya sent out information yesterday regarding Represented Retiree 2018 Annual Enrollment. This reminder is for all AVAYA Retiree Hourly Represented Employees.
Open enrollment started today October 11 and ends on October 24, 2017 with an effective date of changes will occur January 1, 2018.
Review the 2018 Avaya Annual Enrollment Guide available on the Avaya Benefit Enrollment Website https://my.adp.com under forms and plan documents. You and your family should review and make any changes if needed to your dental benefits for 2018 by October 24, 2017.
Your current 2017 dental elections will carry over into 2018 if you do not make changes during this Annual Enrollment. 
Review and update your life insurance beneficiary if needed. 
Any questions contact the Avaya Health & Benefits Decision Center at 1-800-526-8056 or via email at avayaservicecenter@adp.com.
One Exchange will mail out separate Open Enrollment materials regarding your 2018 medical and prescription drug options. These programs are not part of the Avaya Annual Enrollment. 

Chapter Is Here To Serve You
The Avaya Retirees Chapter of the National Retiree Legislative Network is here to serve as your voice on the protection of our pensions, benefits and other retirement security issues.

Vern Larson, President, NRLN Avaya Retirees Chapter.  
Phone: 402-203-6899,
Email vernlarson@cox.net



S&P 500’s Biggest Pension Plans Face $382 Billion Funding Gap
By Brandon Kochkodin and Laurie Meisler, Bloomberg - Jul 20, 2017

Extreme Networks Completes Acquisition of the Networking Business from Avaya, Inc.
Avaya Press Release – Jul 17, 2017

Avaya, bankruptcy and the state of the changing communications market
By Justine Brown; CIO Dive ~ May 23, 2017

Avaya sells networking business to Extreme Networks for $100 million
By Natalie Gagliordi ; ZDNet ~ Mar 07, 2017

Avaya's Chapter 11 filing sends waves of disruption
By Guy William Clinch, NetworkWorld - Feb 10, 2017

Legally & Practically: What Avaya's Chapter 11 Means to Customers
By Marth Buyer, No Jitter - Feb 8, 2017

Avaya Partners Relieved by Chapter 11 Filing, Decision Not to Sell Call-Center Business
By Edward Gately; Channel Partners ~ Feb 01, 2017

Avaya granted $425m loan from US court
By James Pearce; Capacity Media ~ Jan 23, 2017

Avaya files for Chapter 11 bankruptcy, won't sell contact center assets
By Larry Dignan, zdnet - Jan 19, 2017

Telecom Company Avaya Files for Bankruptcy
Reuters report in Fortune – Jan 19, 2017

Multibillion-dollar phone firm deal may fall apart
By Josh Kosman, New York Post - Jan 4, 2017

NRLN Avaya Retirees Chapter Working to Protect What We’ve Earned

Another important release from August 25, 2016

The NRLN Avaya Retirees Chapter has been working database

June 16, 2017
The article below is only for information relevant to the NRLN’s agenda but not necessarily a reflection of the NRLN’s position on issues. Vern Larson, President – Avaya Chapter of the NRLN The NRLN is nonpartisan and its positions on retirement issues are presented in its Legislative Agenda and white papers that can be accessed from the Legislative Agenda tab at www.nrln.org.

Trump White House at work on executive order tackling drug prices

By Eric Sagonowsky; FiercePharma ~ Jun 14, 2017

If President Donald Trump can’t count on Congress to pass legislation targeting high drug prices, his administration may have to go it alone. The White House is working on an executive order on the issue, according to BioCentury, with eyes on value-based contracting for executive agencies.

The executive order would also seek trade policies that protect American drugmakers’ intellectual property rights abroad, according to BioCentury’s sources. The White House didn’t immediately respond to a request to confirm the details.

Since winning the U.S. election, President Trump hasn’t been shy about criticizing pharma, saying back in January that the industry has been “getting away with murder” with high drug prices. At the time, he said the government would implement competitive “bidding” to save billions in costs—not a popular proposal in the drug industry.

RELATED: Trump to pharma: You're 'getting away with murder,' and I'm the one to stop it

Some of the president's other ideas are favored by pharma, however, including a potential tax repatriation holiday, a tax overhaul, fewer regulations and trade policies that defend U.S. pharma’s IP rights.

The BioCentury report comes a day after the Senate’s Health, Education, Labor and Pensions committee convened a hearing to discuss drug pricing; two follow-up hearings are planned later this summer.

Also on Tuesday, Sen. Ron Wyden, D-Ore., introduced the SPIKE Act aimed at deterring the large drug price hikes that have made so many headlines over the last two years. Sen. Wyden’s bill would force drugmakers to justify price hikes above a certain threshold. It could require some companies to disclose R&D and marketing costs, another unpopular idea in biopharma.

RELATED: New FDA commissioner Gottlieb unveils price-fighting strategies

The bill targets not only sky-high price hikes like Turing Pharma’s notorious 5,000% increase on Daraprim but also smaller hikes on big-selling drugs that can hit Medicare and Medicaid budgets hard. It would allow drugmakers to roll back their price hikes if they don’t want to release information justifying the underlying costs.

And while the FDA can’t regulate drug prices, President Trump’s new agency chief recently unveiled some of his own tactics aimed at lowering costs.

RELATED: Pharma CEOs, eager for tax breaks and regulatory help, make nice with Trump

Last month, FDA Commissioner Scott Gottlieb said the agency will publish and update a list of medications that are off patent and have no competition; work to improve generic review times; and seek to “curtail gaming” of regulations by the industry that allows companies to extend patent monopolies.

On the first strategy, Gottlieb said such a list could “entice competitors into the market” and ultimately lower costs.

A number of proposals, including Medicare price negotiations and drug importation, are pending in Congress, but none has been taken to a vote this session. Meanwhile, lawmakers in more than 30 states are trying to pass their own bills to rein in pharmaceutical costs.

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  Copyright 2012 October 12, 2017