About

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 worlds 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 worlds 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 Nortels restatements and the impact any resulting legal judgments, settlements, penalties and expenses could have on Nortels results of operations, financial condition and liquidity; the findings of Nortels 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 Nortels previously announced or filed financial results and resulting negative publicity; the existence of material weaknesses in Nortels internal controls over financial reporting; the impact of Nortels and NNLs failure to timely file their financial statements and related periodic reports, including breach of its support facility and public debt obligations and Nortels 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 Nortels and NNLs publicly traded securities; the impact of management changes, including the termination for cause of Nortels former CEO, CFO and Controller in April 2004; the sufficiency of Nortels 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 Nortels customers; fluctuations in Nortels operating results and general industry, economic and market conditions and growth rates; fluctuations in Nortels cash flow, level of outstanding debt and current debt ratings; Nortels ability to recruit and retain qualified employees; the use of cash collateral to support Nortels normal course business activities; the dependence on Nortels subsidiaries for funding; the impact of Nortels defined benefit plans and deferred tax assets on results of operations and Nortels cash flow; the adverse resolution of class actions, litigation in the ordinary course of business, intellectual property disputes and similar matters; Nortels dependence on new product development and its ability to predict market demand for particular products; Nortels 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 Nortels 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 Nortels forward purchase contracts; the impact of Nortels 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 Nortels 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 Networks.

About Arcturus Networks Inc.

Arcturus Networks Inc. provides Residential Gateway solutions that enable manufacturers to bring converged home networking products to market fast. Arcturus firmware is built around a centralized management database architecture called MIBflex^® that enables broad access to virtually any control point in a device. MIBflex enables features to be extended easily while retaining portability across architectures Arcturus offers firmware suites that target security, voice, media and wireless applications.