June 21, 2011
The Court has approved the Monitor’s request that a third interim distribution be made to all Income Beneficiaries of Nortel’s health and welfare trust. Please click here to view a copy of the Third HWT Interim Distribution Order and a copy of the Court’s Endorsement.
The Third Interim Distribution will provide some financial relief to Income Beneficiaries before the final distribution of Nortel’s HWT corpus. The Monitor’s Report on the original HWT motion indicated that the Income Beneficiaries would be paid approximately 33.8% of the Actuarial Value of their Income Benefits calculated in accordance with the Approved HWT Allocation Methodology. Prior to this third distribution, all Income Beneficiaries received up to 5 months salary or 10% of their Income Benefits (whichever was less) from the January Interim Distribution and the May/June Interim distribution combined. The Third Interim Distribution, together with the previous distributions, will provide a total of 25% of the Actuarial value of the Income Benefits. The balance of the Income Beneficiaries’ entitlement, being approximately 8.8%, will be paid in a further distribution from the HWT. The timing for this final payment is unknown. Like the previous two distributions, the Third Interim Distribution will be credited against Income Beneficiaries’ future distribution from Nortel’s HWT, and all distributions from the HWT will be deducted from claims against the Nortel estate.
The payments are expected to be made at the end of July.