8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

FORM 8-K

CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 2, 2006

AVAYA INC.

(Exact name of registrant as specified in its charter)

Delaware	1-15951	22-3713430
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

211 Mount Airy Road
Basking Ridge, NJ	07920
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (908) 953-6000

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing

obligation of the registrant under any of the following provisions:

[   ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[   ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[   ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR

        240.14d-2(b))

[   ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR

        240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

Amendment of Involuntary Separation Plan for Senior Officers

On November 2, 2006 (the “Effective Date”), the Board of Directors (the “Board’’) of Avaya Inc. (the “Company’’) amended the Avaya Involuntary Separation Plan for Senior Officers (the “Plan”).  The Plan is designed to provide a specific payment and certain benefit enhancements to eligible senior officers of the Company and its affiliated companies and subsidiaries in the event that their employment is involuntarily terminated under certain conditions. The amendment revises the definition of “Senior Officers” under the plan to clarify that it applies to the Chief Executive Officer (“CEO”) of the Company, the Chief Operating Officer (“COO”) of the Company and any officer of the Company who reports directly to the CEO or COO whose target award percentage for purposes of the Avaya Inc. Short Term Incentive Plan is equal to or greater than 70%.   A copy of the Plan as amended is included as Exhibit 10.1.

Amendment of Form of Restricted Stock Unit Award Agreement

On the Effective Date, the Board amended the form of restricted stock unit (“RSU”) award agreement to be used for future awards of time vesting RSUs that are made to senior officers under the Company’s 2004 Long Term Incentive Plan (the “LTIP”).  The amendment provides for prorated vesting of future RSU awards for senior officers who are terminated under the Company’s Force Management Plan (“FMP”).   Termination under the FMP means termination of employment under one of the Company’s Involuntary Separation Plans where the employee is placed “At Risk.”  “At Risk” means a Company initiated termination other than for cause and does not include any termination that is caused by, as a result of or otherwise related to a “Change in Control” as defined in the Avaya Inc. Special Severance Plan.  As amended, the agreement provides that the vesting of time vesting RSU awards for such terminated executives will be prorated based on the number of complete months employed by the Company or any of its subsidiaries during the vesting period.   The amended form of time vesting RSU award agreement for senior officers is included as Exhibit 10.2.

Lead Director and Non-Executive Chairman Retainers

On the Effective Date, the Board authorized an annual retainer to be paid to the Lead Director of the Board in the amount of $25,000 and an annual retainer to be paid to the non-executive Chairman of the Board in the amount of $35,000.  Those amounts are in addition to retainers previously established for service as Directors and members of Board committees.  Consistent with the retainer for service as a member of the Board, each of the recipients of these retainers is required to receive at least 50% of the fee in the form of

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the Company’s common stock to be placed in an account under the Company’s Deferred Compensation Plan.  Set forth as Exhibit 10.3 is the summary of the Company’s non-employee Director compensation program as amended. Mr. Philip A. Odeen has served in the capacity of Lead Director since February 2003. Mr. Odeen was appointed non-executive Chairman of the Board effective October 1, 2006.

Performance Vesting Restricted Stock Unit Awards

On the Effective Date, the Compensation Committee of the Board approved awards of performance vesting RSUs made to executive officers of the Company pursuant to the terms of the LTIP.  However, the exact metrics to be achieved for vesting to occur will be decided at a future Compensation Committee meeting, after which time the Company will file on Form 8-K with the Securities and Exchange Commission additional details regarding the metrics and the form of award agreement.  To the extent that any executive officer named in the Summary Compensation Table of the Company’s proxy statement in connection with its 2006 annual meeting of shareholders received an award of performance vesting RSUs, it is set forth below:

Named Executive Officer	Number of Performance Vesting RSUs
Louis J. D'Ambrosio	79,968
President and Chief Executive Officer
Michael C. Thurk	63,974
Chief Operating Officer
Francis M. Scricco	37,318
Senior Vice President and President — Avaya Global Services

Item 5.02. Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers.

On the Effective Date, Mr. D’Ambrosio, President and CEO of the Company, and Mr. Thurk, COO of the Company, were elected to the Company’s Board.  As employee Directors of the Company, neither Mr. D’Ambrosio nor Mr. Thurk will be eligible to receive compensation for their service on the Board or any committee of the Board.  Attached as Exhibit 99.1 is a press release issued by the Company announcing their elections.

Also on the Effective Date: Mr. Frank Fanzilli was appointed to the Governance Committee of the Board; Dr. Daniel Stanzione was appointed to the Compensation Committee of the Board; and Mr. Joseph Landy was appointed as Chairman of the Finance Committee of the Board. The Board has determined that each of Mr. Fanzilli and Dr. Stanzione is independent, as required under the New York Stock Exchange’s listing standards and the Company’s corporate governance guidelines for service on the Governance and Compensation Committees.

Item 9.01(d). Exhibits.

10.1Avaya Involuntary Separation Plan for Senior Officers amended effective November 2, 2006.

10.2Avaya Inc. 2004 Long Term Incentive Plan Form of Time Vesting Restricted Stock Unit Award Agreement for Senior Officers.

10.3Summary of the Avaya Inc. Non-Employee Director Compensation Program (as of November 2, 2006).

99.1Press Release of Avaya Inc. dated November 3, 2006.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	AVAYA INC.
Date: November  7, 2006	By:	/s/ Pamela F. Craven
	Name: Pamela F. Craven
	Title:   Chief Administrative Officer

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EX-10.1

Exhibit 10.1

AVAYA INVOLUNTARY SEPARATION PLAN FOR SENIOR OFFICERS

PLAN DOCUMENT

AND

SUMMARY PLAN DESCRIPTION

(Amended Effective November 2, 2006)

THIS DOCUMENT, LIKE ALL AVAYA PLANS, PERSONNEL POLICIES OR PRACTICES, IS NOT A CONTRACT OF EMPLOYMENT.  IT IS NOT INTENDED TO CREATE, AND IT SHOULD NOT BE CONSTRUED TO CREATE, ANY CONTRACTUAL RIGHTS, EITHER EXPRESS OR IMPLIED, BETWEEN ANY PARTICIPATING COMPANY AND ITS EMPLOYEES.  THE PRACTICES AND PROCEDURES DESCRIBED IN THIS DOCUMENT MAY BE CHANGED, ALTERED, MODIFIED OR DELETED AT ANY TIME, WITH OR WITHOUT PRIOR NOTICE.

EMPLOYMENT AT AVAYA IS “AT-WILL”.  THIS MEANS THAT EMPLOYEES HAVE THE RIGHT TO QUIT THEIR EMPLOYMENT AT ANY TIME AND FOR ANY REASON, AND AVAYA HAS THE RIGHT TO TERMINATE ANY EMPLOYEE, AT ANY TIME AND FOR ANY REASON.

IN THE EVENT THERE IS A CONFLICT BETWEEN STATEMENTS IN THE SEPARATION PLAN AND THE TERMS OF ANY BENEFIT PLAN, POLICY, OR PRACTICE WITH RESPECT TO THE BENEFITS PROVIDED THEREIN, THE APPLICABLE BENEFIT PLAN, POLICY OR PRACTICE WILL CONTROL.  THE BOARD OF DIRECTORS OF AVAYA INC. (OR ITS DELEGATE) RESERVES THE RIGHT, AT ANY TIME, TO MODIFY, SUSPEND, CHANGE, OR TERMINATE AVAYA’S BENEFIT PLANS, POLICIES OR PRACTICES.

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A.  OVERVIEW

The Avaya Involuntary Separation Plan for Senior Officers (the “Plan”), effective as of October 13, 2001 and as amended from time to time, is designed to provide a specific payment and certain benefit enhancements to eligible Senior Officers of Avaya Inc. (“Avaya” or the “Company”) and its affiliated companies and subsidiaries (collectively “Participating Companies”) whose employment is involuntarily terminated under conditions described in the Plan.

B.  TYPE OF PLAN

Under Section 3 (1) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), this Plan is classified and is to be interpreted as an employee welfare benefit plan for purposes of providing specified post employment payments and other benefits.

C.  PLAN PARTICIPATION

You are a participant in this Plan (a “Participant”) if you are a regular full-time Senior Officer, who is on the active roll of the Company (including employees on loan to other organizations, receiving benefits under the Avaya Short Term Disability Plan (“STD”) or on a leave of absence with guaranteed reinstatement rights), and you have been designated “At Risk” under the Avaya Force Management Program (“FMP”) Guidelines in effect at that time.  For the purposes of this Plan, “At Risk” under the FMP Guidelines means a company initiated termination other than for “cause,” which is defined as follows: (1) conviction (including a plea of guilty or nolo contendere) of a felony or any crime of theft, dishonesty or moral turpitude; or (2) gross omission or gross dereliction of any statutory or common law duty of loyalty to the Company, or (3) any other violation of Avaya’s Code of Conduct.  “At Risk “shall not include any termination that is caused by, as a result of or otherwise related to a “Change in Control” as defined in the Avaya Inc. Special Severance Plan.  Employees whose termination is caused by, as a result of or otherwise related to a Change in Control are not eligible to participate in this Plan.

For purposes of this Plan, a Senior Officer is the Chief Executive Officer (“CEO”) of the Company, the Chief Operating Officer (“COO”) of the Company and any officer of the Company who reports directly to the CEO or COO whose target award percentage for purposes of the Avaya Inc. Short Term Incentive Plan is equal to or greater than 70%.

For purposes of this Plan, Net Credited Service (“NCS”) shall be equal to the Participant’s time on the U.S. payroll of Avaya or any member of its controlled group of corporations (within the meaning of section 414(b) of the Internal Revenue Code of

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1986, as amended), while the corporation is part of the control group, excluding any leave of absence or disability leave.

The Vice President — Total Rewards and HR Services of Avaya or his or her delegate shall determine if and when this Plan, and to what organizations, positions and groups of employees, this Plan is to be applied.

D.  ELIGIBILITY TO RECEIVE BENEFITS

If you are a Participant, you are eligible to receive the benefits described in Section F upon the involuntary termination of your employment pursuant to the terms of this Plan, on your Scheduled Off-Payroll Date as set forth in Section E.

E.  SCHEDULED OFF-PAYROLL DATE

Your Scheduled Off-Payroll Date will be the date that is specified in the written notice you receive confirming your designation as “At Risk”, which date will be thirty (30) days from the date of that notice.   It is expected that, subject to the transition requirements of your business organization, you will use all accrued unused vacation prior to your Scheduled Off-Payroll Date.  If you are unable to do so because of business transition needs, you will be paid for unused vacation days for the current fiscal year and, for California employees only, any carry-over days approved prior to the beginning of the current fiscal year.  You will not receive pay in lieu of floating holidays and designated holidays if these days are not taken prior to terminating employment, unless required by state law.

F.  PLAN PAYMENTS AND BENEFITS

The Post-Employment Payments and Benefits described in this Section F of the Plan constitute the exclusive post-employment payments and benefits that a Senior Officer who is terminated under the FMP guidelines is entitled to receive and are provided in lieu of any post-employment benefits available under any other applicable severance plan, program, policy, individually negotiated separation agreement or other individual arrangement of or with a Participating Company.

1.  Post-Employment Payment

A Participant who becomes eligible to receive benefits under this Plan, shall be entitled to receive a Post-Employment Payment under this Section F.1. in the amount of one hundred and fifty percent (150%), of final annual base salary plus Short-term Incentive target  if the Participant elects to sign and does not revoke a Termination Agreement and Release in accordance with the provisions of Section G of this Plan.

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2.  Annual Incentive 

In accordance with the Short Term Incentive Plan, an employee must be actively at work on the last day of the annual performance period to be eligible for payment.  Actual payment, if any, will be subject to both company and individual performance.

3.  Stock Options

Vesting or cancellation of stock options, restricted stock units or other long-term awards granted prior to your actual termination date shall be in accordance with the terms and conditions of the Avaya Inc. Long Term Incentive Program or other long-term incentive plan or program pursuant to which you have been provided options and your award agreements.

4.  Financial Counseling

If you are not Service Pension eligible, you will continue to be eligible for Company paid financial counseling services for three (3) months after the month in which your employment terminates, up to your prorated benefit amount.

If you are Service Pension eligible, you will be entitled to financial counseling services for one full year from your actual termination date up to your annual benefit amount in accordance with current practice.

5.  Outplacement Services

You will be entitled to receive individual services of a Company paid outplacement consultant for one year from your off roll date, in accordance with customary practice for Senior Officers.

6.  Other Perquisites

All other Senior Officer Perquisites will end as of your last day on the active payroll.  These include, but are not limited to: monthly car allowances, use of company chauffeurs, aircraft, executive travel, etc.

7.  Method of Payment

To receive your Post-Employment Payment, you must sign the Termination Agreement and Release (Exhibit “A”) and return it to the Executive Compensation and Benefits Manager of Avaya within forty-five days of your actual termination date.  The Post Employment Payment shall be paid in a lump sum within 45 days after receipt of the validly executed and delivered Termination Agreement and Release, but not sooner than the expiration of the seven (7) day revocation period during which you may revoke the Termination Agreement and Release.  Revocation during that period will result in ineligibility for payment.

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G. TERMINATION AGREEMENT AND RELEASE

A Participant who is otherwise eligible to receive a Post Employment Payment under Section F.1 shall not be entitled to receive any of such benefits until the Participant has signed a Termination Agreement and Release (a copy of which is attached hereto as Exhibit “A”) which releases and discharges Avaya, its benefit committees, and all of its affiliates, subsidiaries, resulting new entities, and the respective successors and assigns, and the respective shareholders, officers, directors, employees and members of all of the named entities from all claims, demands or causes of action of any kind whatsoever arising out of your employment and the termination of your employment.

H.  WITHHOLDINGS

The amount of the Post-Employment Payment paid pursuant to this Plan is subject to the withholding of federal, state and local taxes, FICA (Social Security taxes), and FUTA and SUTA (unemployment taxes) at the time of payment and will be reported on IRS form W-2.  Payment will not be reduced for contributions to, or be recognized under, any Avaya employee or Senior Officer benefit plan or program.

I.  PAYMENT UPON DEATH, DISABILITY OR LEAVE OF ABSENCE

1.  Death

If you should die on or before your actual termination date, no payments will be made or benefits provided under this Plan.  You will be treated as if you had died as an active employee and your estate or your beneficiaries will be entitled to the customary benefits payable upon the death of an active Senior Officer.  If you should die after your actual termination date, but before payment is made, your Post-Employment Payment, if applicable, will be made to your lawful spouse or, if you are not survived by a lawful spouse, to your estate in a single lump sum as soon as practicable after your death, provided you or the executor of your estate has signed and has not revoked a Termination Agreement and Release in accordance with the provision of Section G of this Plan.

2.  Disability and Leaves of Absence

If you are receiving disability benefits or you are on a leave of absence with a right to guaranteed reinstatement prior to terminating employment, any payments under this Plan to you shall be computed and paid as follows:

(a)  Employees receiving disability benefits:

No payment under this Plan will be made until your employment is formally terminated at the time your benefits under the Short Term Disability Plan stop.  Any payments due under this Plan shall be reduced by the full amount of any disability benefits paid subsequent to your Scheduled Off-Payroll Date.

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(b)  Employees on a leave of absence with guaranteed right of reinstatement:

Payments computed under this Plan will not be payable until after your employment is formally terminated at the conclusion of your leave of absence.

J.FORFEITURE

You will forfeit all or a portion of your benefits, including the benefits listed under section K, under the following circumstances:

1.  Re-Employment

If, within one year of your actual termination date, you become employed by:  (i) Avaya, or (ii) any entity within Avaya’s controlled group of corporations within the meaning of Section 1563 of the Internal Revenue Code or (iii) any other company which participates in Avaya’s U.S. pension plans or (iv) any of the successors or assigns of any of them, you will be required to repay to Avaya that portion of the Post-Employment Payment which relates to the part of the year that you are re-employed.  That portion will be determined as follows: the Post-Employment Payment will be multiplied by a fraction, the numerator of which is the number of complete months (of the 12 month period following your actual termination date) during which you were re-employed and the denominator of which is 12.  The result will be the amount that you must repay to the Company.

2.  Dispositions and Outsourcing

If, in connection with, as a result of or in anticipation of a disposition or a sale of any portion of the stock or assets of Avaya or an outsourcing of any of Avaya’s products, services, processes or other business concerns a Participant is offered an opportunity, (i) to perform services as an employee with the purchaser or service provider or (ii) to provide consulting services or to otherwise render services to a purchaser or service provider as an employee, independent contractor, consultant or in any other capacity, full— or part- time, at any time within the ninety (90) day period immediately following the participant’s termination of employment with the Company, then such participant must repay the entire Post Employment Payment described in Section F to the Company from which his or her employment was terminated and will cease receiving benefits described in section K effective as of the date of such hiring.

3.  Violation of Avaya Code of Conduct or Proprietary Information

Notwithstanding any other provision of this Plan, if, as determined by the Vice President - Total Rewards and HR Services of Avaya, you violate Avaya’s Code of Conduct and/or fail to continue to fulfill your obligations not to disclose the Company’s private, confidential or proprietary information, you shall not be entitled to receive a payment or if payment has been made you will be required to repay the Post Employment Payment in its entirety to the Company.

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K.  MEDICAL, LIFE INSURANCE, AND OTHER BENEFITS

The provisions regarding medical, dental, and life insurance coverages are outlined below.    For a description of the provisions of such coverages, including administration of or rights of Participants under any of Avaya’s health (include COBRA rights) or life insurance plans, please consult the applicable plan documents, which control, and the respective Summary Plan Descriptions for active and retired employees. In the event there is a conflict between the material in this Plan and the terms of the respective benefit plan documents, the benefit plan documents will control and govern the operation of such plans.  Avaya reserves the right to modify, suspend, change or terminate the benefit plans described in this Section K at any time and without prior notice to Participants.

1.  Service Pension Eligible Employees

If you are eligible to retire with a service pension under the service based program of the Avaya Inc. Pension Plan for Salaried Employees or the Avaya Inc. Pension Plan, health and life insurance coverage will be available under the provisions that normally apply to retiring service pensioners.

2.  Non-Service Pension Eligible Employees

Certain other benefits are continued for non-service pension eligible Participants as described below:

(a)  Medical Expense Plan

If you have five or more years of Net Credited Service (NCS) the Company will pay for your coverage to continue on the same basis as for active employees under the Medical Expense Plan for six (6) months after the month in which your employment terminates.  After that, you can continue coverage under COBRA for up to an additional twelve (12) months by paying the applicable COBRA rate.

If you have at least one year but less than five years of NCS, the Company will pay for your coverage to continue on the same basis as for active employees under the Medical Expense Plan for three (3) months after the month in which your employment terminates.  After that, you can continue coverage under COBRA for up to an additional fifteen (15) months by paying the applicable COBRA rate.

If you have less than one year of NCS, you can continue Medical Expense Plan coverage under COBRA for up to 18 months after the month in which your employment terminates by paying the applicable COBRA rate.

If you are enrolled in an HMO at termination, your HMO coverage will be continued for the same period as described above.  All coverage continued for you and your eligible dependents will be the same as the coverage provided while you were an active employee, subject to the terms of the Medical Expense Plan and provided that you continue to pay your share of the cost of the HMO premium.  Thereafter, continuation of coverage for the remainder of the COBRA period may be continued by paying the applicable COBRA rate.

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You should immediately notify the COBRA administrator if you become covered under another group health plan.

(b)  Dental Expense Plan

You may continue plan coverage under the Dental Expense Plan under COBRA for up to 18 months after the month in which your employment terminates by paying the applicable COBRA rate.

NOTE:  The Company provides Participants with up to 18 months of continuing health care coverage (Medical Expense Plan, Dental Expense Plan, and Health Care Reimbursement Account Plan) under COBRA when they leave the active payroll, at the Participant’s expense.  The 18 months of continuing COBRA coverage will run concurrently with the periods described above.  The Participant will receive a COBRA package after he or she leaves the active payroll, including appropriate current health care coverage options and billing information.

(c)  Life Insurance

If you are not retiring on a service or disability pension under the Avaya Inc. Pension Plan for Salaried Employees, your coverage under the Avaya Inc. Executive Life Insurance Program may continue, at your own expense, for as long as you continue to pay the premiums after the month in which your employment actually terminates.

If you are a Service-Based Program participant of the Avaya Inc Pension Plan for Salaried Employees and you retire on a service or disability pension, your coverage under the Avaya Inc. Executive Life Insurance Program will continue, but is subject to reduction from the time of retirement.  The amount of the insurance will be reduced 10% each year, beginning on the first day of your  retirement, until the 50% threshold is reached.  This coverage will be paid by the Company.   You will be subject to imputed income based on the amount of life insurance coverage provided.

(d) Supplementary Life Insurance.  Regardless of retirement eligibility, your coverage, up to the Plan maximum, can be continued by paying the premiums set by the Insurer, MetLife, directly to the insurer.   Please contact MetLife at 800-523-2894.

(e)  Dependent Group Life Insurance.

You may continue plan coverage under the Avaya Inc. Dependent Group Life Insurance Plan for up to three (3) months after the month in which your employment terminates by paying the group premium directly to the insurance carrier.   At the end of the three (3) month period, you can request conversion to an individual policy by contacting MetLife, the insurance carrier, at 888-466-8659.

(f)  Basic Accidental Death and Dismemberment (AD&D).

Your coverage of one times total annual pay (as defined in the Avaya Inc., Life Insurance Plan) will continue, at no cost to you,  for six (6) months after the month in which your employment terminates.  AD&D insurance cannot be converted to an individual policy.

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(g) Supplementary Accidental Death and Dismemberment. 

You may continue your coverage, up to the Plan maximum, (as defined in the Avaya Inc., Life Insurance Plan) for up to six (6) months after the month in which your employment terminates by paying the group premium directly to the Insurer, MetLife.  Please contact MetLife at 888-466-8659.  AD&D insurance cannot be converted to an individual policy.

(h)  Dependent Accidental Death and Dismemberment.

You may continue coverage under the Avaya Inc. Dependent AD&D insurance for up to three (3) months after the month in which your employment terminates by paying the group premium directly to the Insurer, MetLife.  Dependent AD&D insurance cannot be converted to an individual policy.

(i)  Long-Term Care

You may elect to continue coverage through the Insurer, MetLife, by paying the group premium directly.  Please contact MetLife at 800-438-6388.

(j)  Reimbursement Accounts

You may continue to submit claims incurred through your last day on the payroll up to the amount elected for that plan year in the Avaya Inc. Health Care Reimbursement Account Plan.  You may also continue to submit claims incurred through the end of the plan year up to the amount contributed through your last day on the payroll in the Avaya Child/Elder Care Reimbursement Account Plan.  Claims under both programs may be submitted through April 15 of the following year after your termination.  You may choose to continue to participate in the Avaya Health Care Reimbursement Account Plan, through COBRA, on an after-tax basis by making monthly deposits to the account.

(k) Voluntary Benefits Program

Vision coverage can be continued under COBRA for up to 18 months after the month in which your employment terminates by paying the applicable COBRA rate.

Legal Service coverage through the Hyatt Legal plan (800-821-600) and property and casualty insurance through MetLife (800-438-6388) can be continued by paying the premiums directly to the carriers.  Please contact the carrier directly if you would like to continue coverage.

(l)Disability Programs

Coverage under the employee’s short term disability programs ends on the last day of employment.  Employees who are receiving short term disability benefits must waive any rights they may otherwise have to continued short or long term disability benefits in order to receive the benefits described in Section F.

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3.  END OF COVERAGE

Other than as extended above, all coverage ceases at the end of the month in which your employment terminates.  Notwithstanding the above, all coverage set forth above automatically ends when you become eligible for group coverage under another plan of any other employer or other organization or if you fail to pay a required premium or if the conditions set forth in Section J are met.

4.  OTHER BENEFIT PLAN AGREEMENTS.

If you were an employee of any entity at the time the stock or assets of such entity were acquired by the Company, and you became an employee of the Company through such acquisition, any agreements entered into by the Company, which apply to Participants, will control, where relevant, with respect to the benefits available to you under the Plan.

L.  BENEFIT CLAIM AND APPEAL PROCEDURES

1.  Claim Procedure

Any Participant in the Plan, or a person duly authorized by a Participant, may file a claim in writing for benefits under this Plan if the Participant believes he or she has not received benefits to which he or she was entitled under the Plan.  Such a claim may only relate to a matter under the Plan and not any matter under the FMP Guidelines or any other Participating Company policy, practice or guideline.

The written claim should be sent to the Vice President — Total Rewards and HR Services of Avaya, 211 Mt. Airy Road, Basking Ridge, NJ 07920.  The written claim should be sent within 60 days of the date of the occurrence of facts giving rise to the claim.

If the claim is denied, in whole or in part, the claimant will receive written notice from the Vice President, Total Rewards and HR Services or his or her delegate.  The information will be provided within 90 days of the date the claim was received.

The written notice will include:

·the specific reason or reasons for the denial;

·specific reference to pertinent Plan provisions on which the denial was based;

·a description of any additional material or information necessary to perfect the claim and an explanation of why such material or information is necessary;  and

·appropriate information as to the steps to be taken if the Participant, spouse, heirs or estate or representative desires to submit the claim for review.

In some cases, more than 90 days may be needed to make a decision.  In such cases, the claimant will be notified in writing, within the initial 90-day period, of the reason more time is needed.  An additional 90 days may be taken to make the decision if the claimant is sent such a notice.  The extension notice will show the date by which the decision will be sent.  If no response is received within the 90-day period, the claim is considered denied.

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2.  Appeal Procedure

A claimant may use this procedure to appeal a denied claim if:

·no reply at all is received by the claimant within 90 days after filing the claim;

·a notice has extended the time an additional 90 days and no reply is received within 180 days after filing the claim;  or

·written denial of the claim for benefits or other matters is received within the proper time limit and the claimant wishes to appeal the written denial.

If a claim for benefits is denied, in whole or in part, either expressly or by virtue of the Participant not having received a reply, the Participant, or other duly authorized person may appeal the denial in writing within 60 days after the denial is or should have been received.  Written request for review of any denied claim or any other disputed matter should be sent directly to Avaya Inc. Attn:  Employee Benefits Committee, 211 Mount Airy Road, Basking Ridge, NJ 07920.

The Avaya Inc. Employee Benefits Committee (the “EBC”) serves as the final review committee under the Plan for all Participants.  The EBC has sole and complete discretionary authority to determine conclusively for all parties and in accordance with the terms of the documents or instruments governing the Plan, and all questions arising from the administration of the Plan and interpretation of all plan provisions, determination of all questions relating to participation of eligible employees and eligibility for benefits, determination of all relevant facts, the amount and type of benefits payable to any Participant, spouse, heirs or estate, and the construction of all terms of the Plan.  All determinations and decisions of the EBC are conclusive and binding on all parties and not subject to further review.

Unless the EBC sends notice in writing that the claim is a special case needing more time, the EBC will conduct a review and decide on the appeal of the denied claim within 60 days after receipt of the written request for review.  If more time is required to make a decision, the EBC may have 60 days, a total of 120 days, to make its decision.

If the claimant sends a written request of a denied claim, the claimant has the right to:

(i)Review pertinent Plan documents which may be obtained by following the procedures described in this Plan document, and

(ii)Send to the EBC a written statement of the issues and any other documents in support of the claim for benefits or other matters under review.

The EBC decision shall include specific reasons for the decision as well as specific references to the pertinent Plan provisions on which the decision is based.  If the EBC does not give its decision on review within the appropriate time span, the claimant may consider the claim denied.

Please note that the Plan requires that a Participant pursue all the claim and appeal rights described above before seeking any other legal recourse regarding claims for benefits.

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M.  ERISA RIGHTS STATEMENT

All employees eligible for benefits under this Plan are Plan Participants.  Participants in this Plan are entitled to certain rights and protection under ERISA.  ERISA provides that all Plan Participants shall be entitled to:

·Examine, without charge, at the office of the Plan Administrator, at 211 Mt. Airy Road, Basking Ridge, NJ 07920, the Plan documents and copies of all documents filed by this Plan with the U.S. Department of Labor, such as detailed annual reports.  A reasonable fee or charge may be imposed for such copies.

In addition to creating rights for Plan Participants, ERISA imposes duties upon the people who are responsible for the operation of employee benefits plans.  The people who operate this Plan, called “fiduciaries” of this Plan, have a duty to do so prudently and in the interest of all Plan Participants.  No one, including a Participant’s employer or any other person may fire or otherwise discriminate against a Participant in any way for the purpose of preventing a Participant from obtaining a benefit or exercising rights under ERISA. If any claim for a Plan benefit is denied, in whole or in part, the person whose claim was denied must receive a written explanation of the reason for the denial.  Such a person has the right to have the Vice President, Total Rewards and HR Services or his or her delegate and/or the EBC review and reconsider that claim (see Section Q, entitled “Benefit Claim and Appeal Procedures”).

Under ERISA, there are steps to take to enforce the above rights.  For instance, if materials from this Plan are requested but not received within 30 days, the person making the request may file suit in a federal court.  In such cases, the court may require the Participating Company to provide the materials and pay that person up to  $110 a day until the materials are received, unless they were not sent because of reasons beyond the control of the Company.  Anyone whose claim for benefits is denied after final review or ignored, in whole or in part, may file suit in a state or federal court.  Anyone who is discriminated against for asserting rights under this Plan may seek assistance from the U.S. Department of Labor or may file suit in a federal court, but an action relating to a claim for benefits may not be filed prior to exhausting the claim and appeal procedure under this Plan. The court will decide who will pay court costs and legal fees.  If that person is successful, the court may order the party that was sued to pay these costs and fees.  If that person loses, the court may order him or her to pay these costs and fees if, for example, it finds that the claim was frivolous.

Anyone who has questions about this Plan should contact the Plan Administrator, Executive Compensation and Benefits Manager at, 211 Mt. Airy Road, Basking Ridge, NJ 07920.  Anyone who has questions about this statement of Participants’ rights, or about rights under ERISA, should contact the nearest office of the U.S. Labor - Management Services Administration, Department of Labor.

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N.  PLAN ADMINISTRATOR

Avaya Inc., 211 Mount Airy Road, Basking Ridge, NJ 07920, is the Plan Administrator of the Plan. Avaya and each of its subsidiary companies that are covered by the Plan have delegated administrative authority and responsibility to the Avaya Inc. Employee Benefits Committee (“EBC”).  The EBC is located at Avaya Inc. 211 Mt. Airy Rd, Basking Ridge, NJ  07920.  The Vice President, Total Rewards and HR Services of Avaya or his or her delegate is the named fiduciary of this Plan who makes determinations concerning when and to what positions or groups payments should be made in Avaya.    The EBC is also a named fiduciary and is the final review committee under the Plan. 

O.  EMPLOYER AND PLAN IDENTIFICATION NUMBERS

This Plan is identified by the following number under Internal Revenue Service rules:

Employer ID # 22-3713430 assigned by the IRS.

Plan # 531 assigned by Avaya.

P. AMENDMENT AND TERMINATION.

Pursuant to Section 402(b)(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Board of Directors of Avaya Inc. (“Board”), or its authorized representative pursuant to delegated authority (“Delegate”), may from time to time amend, modify or change this Plan at any time, and the Board or its Delegate may terminate this Plan at any time. Plan amendments may include, but are not limited to, elimination or reduction in the level or type of benefits provided to any class or classes of employees (and their spouses and dependents).

Q.  PLAN DOCUMENTS

This document is both the Summary Plan Description and the official Plan document which regulates the operation of this Plan.

R.  LEGAL PROCESS.

Process can be served on the Plan or Avaya Inc., as Plan Administrator, by directing such legal service to Avaya Inc., 211 Mt. Airy Road, Basking Ridge, NJ  07920, Attention:  Vice President — Total Rewards and HR Services

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S.  ASSIGNMENT OR ALIENATION

No payment or benefits under this Plan or any right or interest in such payments or benefits shall be assignable or subject in any manner to anticipation, alienation, sale, transfer, assignment, claims of creditors, garnishment, pledge, execution, attachment or encumbrance of any kind, including, but not limited to, pursuant to any domestic relations order (within the meaning of Section 206(d)(3) of ERISA and Section 414(p)(1)(B) of the Internal Revenue Code) and any such attempted disposition shall be null and void.  The payment and benefits hereunder or the right to receive future payment or benefits under the Plan may not be anticipated, alienated, sold, transferred, assigned, pledged, executed upon, encumbered, or subjected to any charge or legal process; no interest or right to receive a payment or benefit may be taken either voluntarily or involuntarily, for the satisfaction of the debts of, or other obligation or claims against such person or entity, including judgment or claims for alimony, support, separate maintenance and claims in bankruptcy proceedings.

T.TERMS AND CONDITIONS OF EMPLOYMENT.

This document is not a contract of employment.  It is not intended to create, and it should not be construed to create, any contractual rights, either express or implied, between you and the Company.  The employment relationship between the Company and the employees covered by the Plan is “at-will”.  This means that employees have the right to quit their employment at any time and for any reason, and the Company reserves the right to terminate any employee’s employment, with or without cause, at any time for any reason.

U.FUNDING.

Payments made under the Plan will be paid out of the general assets of the Company.

V.CONTROLLING LAW.

The Plan shall be construed, administered and governed according to the laws of the State of New Jersey, except to the extent preempted by federal law, which shall in that case control.

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In Witness whereof the Company has caused this Plan, as amended, to be  effective as of the 2nd day of November, 2006

AVAYA INC.
By:
	Roger Gaston	Date
	Sr. Vice President — Human Resources
Attest:
	Signature	Date
	Title

15

“Exhibit A”

Termination Agreement & Release

In consideration of the fact that I have voluntarily and of my own free will elected to accept a Post Employment Payment and that Avaya Inc. (“Avaya Inc.” or “the Participating Company”) has agreed to pay me the Post Employment Payment, subject to the terms and limitations of the Avaya Inc. Involuntary Separation Plan for Senior Officers, I acknowledge and agree to the following:

1.I have been told by the Participating Company, and I understand, that I may elect, at my option, to receive a Post Employment Payment, but that my election to receive the Post Employment Payment is expressly conditioned upon my signing a Termination Agreement and Release on or after the date of my termination from the Participating Company, and returning it to my Force Management Coordinator.

2.I realize that there are various state and federal laws that govern my employment relationship with the Participating Company and/or prohibit employment discrimination on the basis of age, color, race, gender, sexual preference/orientation, marital status, national origin, mental or physical disability, religious affiliation or veteran status and that these laws are enforced through the courts and agencies such as the Equal Employment opportunity Commission, Department of Labor and State Human Rights Agencies.  Such laws include, but are not limited to, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, as amended, 42 U.S.C. Section 1981, and state and local laws prohibiting discrimination on the basis of age, etc.  In consideration of the Post Employment Payment provided for in this Termination Agreement and Release, I intend to give up any rights I may have under these or any other laws with respect to my employment and termination of employment at the Participating Company and acknowledge that the Participating Company (including its subsidiaries and affiliates) has not (a) discriminated against me, (b) breached any express or implied contract with me, or (c) otherwise acted unlawfully toward me.

3.On behalf of myself, my heirs, executors, administrators, successors and assigns, I release and discharge Avaya Inc. (including any “resulting new entity” as defined in the Separation Plan), the various Avaya Inc. Benefit Committees, and their successors, assigns, subsidiaries, affiliates, shareholders, directors, officers, representatives, agents and employees (collectively “Releasees”) from any and all claims (including claims for attorneys’ fees and costs), charges, actions and causes of action with respect to, or arising out of, my employment or termination of employment with the Participating Company.  This includes, but is not limited to, claims arising under federal, state, or local laws prohibiting age, color, race, gender, sexual preference/orientation, marital status, national origin, mental or physical disability, religious affiliation or veteran status or any other forms of discrimination or claims growing out of the Participating Company’s termination of its employees.  It also includes claims based on theories of contract or tort, whether based on common law or otherwise.

This agreement does not limit my right to file charges with government agencies, but with respect to any charges that have been or may be filed concerning events or actions relating to my employment or the termination of my employment and which occurred on or before the date of this Termination Agreement and Release, I additionally waive and release any right I may have to recover in any lawsuit or proceeding brought by me, an administrative agency, or any other person on my behalf or which includes me in any class.

(For employees working in California) Section 1542 of the Civil Code of the State of California states:

“A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the Release, which if known by him must have materially affected his settlement with the debtor.”

Notwithstanding the provisions of Section 1542, and for the purpose of implementing a full and complete release and discharge of all Releases, I expressly acknowledge that this Termination Agreement and Release is intended to include not only claims that are known, anticipated or disclosed, but also claims that are unknown, unanticipated and undisclosed.

4.Subject to Paragraph 5 herein, I covenant and agree not to bring any action, suit or administrative proceeding contesting the validity of this Termination Agreement and Release or attempting to negate, modify or reform it, nor to sue any Releasee for any reason arising out of my employment or termination thereof.

5.I understand that this Termination Agreement and Release in no way affects any rights I may have for benefits under the Avaya Inc. Pension Plan for Salaried Employees (APPSE) or the Avaya Inc. Pension Plan (APP).

6.I have no knowledge of any wrongdoing involving improper or false claims against a federal or state governmental agency, or other wrongdoing that involves me or other present or former Participating Company employees.

7a    I recognize and acknowledge that during my employment with Avaya I have had access to highly confidential and proprietary Company information and trade secrets (“Proprietary Information,” as described herein) and the use, misappropriation or disclosure of  Proprietary Information would cause irreparable injury to Avaya; and it is essential to the protection of Avaya’s good will and to the maintenance of Avaya’s competitive position that Proprietary Information be kept secret and that I may not disclose  Proprietary Information to others or use any Proprietary Information to my own advantage or the advantage of any third parties.  For purposes of this Agreement, the term

16

“Proprietary Information” shall include any and all information, in any form whatsoever, including but not limited to, hard copy, computer floppy diskette, CD, CD-ROM drive, information retained in electronic storage, or other information storage means, relating to Avaya’s technology; techniques; processes; tools; research and development; market research, data and strategy; and, information relating to sales, pricing and customers, including customer-specific sales information, pricing policies and strategies

7b.I further recognize and acknowledge that it is vital for the proper protection of Avaya’s legitimate interests that during the term of my employment and for a period of one (1) year from the date of termination of my Avaya employment, and in exchange for the consideration I have received in this Agreement I may not directly or indirectly: (i) solicit, induce, or attempt to induce employees of Avaya or any affiliate of Avaya to terminate their employment with, or otherwise cease their relationship with Avaya or any affiliated company; or (ii)  solicit, induce, hire or attempt to solicit, induce or hire any employee of Avaya to work or provide services to any third party; or (iii) solicit to divert or take away or attempt to divert or to take away, the business or patronage of any of Avaya’s clients, customers or accounts, or prospective clients, customers or accounts.  Provided, however, that insofar as the restrictions set forth in this paragraph prohibit the solicitation, inducement or attempt to hire a licensed attorney who is employed at Avaya, they shall not apply to me if I am a licensed attorney and the restrictions contained herein are illegal, unethical or unenforceable under the laws, rules and regulations of the jurisdiction in which I am licensed as an attorney.

7c.I agree that I will not in any way disparage Avaya Inc., its products, services, employees, officers, directors or its former employees, officers or directors at any time.

7d.I agree that if I violate the terms of this Section 7 (including any of its subsections), Avaya may recover the payment made to me under this Agreement and I agree to repay Avaya such payment within ten (10) business days of Avaya’s demand of me in writing.  Further, insofar as any violation of this Section 7 (including any of its subsections) may cause harm or injury to Avaya which may not be calculable or remedial by way of monetary damages, I understand and acknowledge that Avaya may initiate an action in law or in equity to prevent me from engaging in any conduct which is in violation of this Section 7 (including any of its subsections).

7e.If any restriction set forth in this Section 7 (including any of its subsections) is found by a court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend over the maximum period of time, range of activities or geographic areas as to which it may be enforceable.

7f.I understand and agree that the restrictions contained in this Section 7 (including any of its subsections) are necessary for the protection of the business and goodwill of Avaya and is expressly considered by me to be reasonable for such purpose.

8.The construction, interpretation and performance of this Termination Agreement and Release shall be governed by the laws of the state in which I am working on the date of my termination from the Participating Company’s payroll, except that state’s conflict of laws rules.

9.In the event that any one or more of the provisions contained in this Termination Agreement and Release shall for any reason be held to be unenforceable in any respect under the law of any state or of the United States of America, such unenforceability shall not affect any other provisions of this Release, but, with respect only to that jurisdiction holding the provision to be unenforceable, this Release shall then be construed as if such unenforceable provision or provisions had never been contained herein.

10.I understand that, pursuant to the Older Workers Benefit Protection Act of 1990, I have the right and have been advised to consult with an attorney before signing the Termination Agreement and Release, I have 21 days to consider the Release before signing it, and I may revoke the Release within seven (7) calendar days after signing it.  For revocation to be effective, written notice must be received by the Participating Company no later than the close of business on the seventh day after I sign this Termination Agreement and Release.  I understand that this revocation can be made by delivering the written notice of revocation to the Executive Compensation and Benefits Manager (below).

11.This Termination Agreement and Release contains the entire agreement between the Participating Company and me and fully supersedes any and all prior agreement or understandings pertaining to the subject matter hereof.  I represent and acknowledge that in executing this Termination Agreement and Release, I have not relied upon any representation or statement not set forth herein made by any of the Releases or by any of the Release’s agents, representatives or attorneys with regard to the subject matter of this Agreement.

12.All defined terms used in this Termination Agreement and Release shall have the same meaning as the Separation Plan.

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BY SIGNING THIS TERMINATION AGREEMENT AND RELEASE, I STATE THAT; I HAVE READ IT; I UNDERSTAND IT AND KNOW THAT I AM GIVING UP IMPORTANT RIGHTS; I AGREE WITH EVERYTHING IN IT; I WAS ADVISED TO, AND I AM AWARE OF MY RIGHT TO CONSULT AN ATTORNEY BEFORE SIGNING IT; AND I HAVE SIGNED IT KNOWINGLY AND VOLUNTARILY.

	Return this Release to:
Employee Signature	Avaya Inc.
	Executive Comp and Benefits
	Attn:  Jill Bergenty
Employee Name Printed	Room 3E 025B
	211 Mt. Airy Road
	Basking Ridge, NJ  07920
Home Phone Number
	Confidential fax number:  908-953-3317
Social Security Number
Date (this date must be the off-role date or later)

18

EX-10.2

Exhibit 10.2

AVAYA  INC.  2004 LONG  TERM  INCENTIVE  PLAN (“PLAN”)
FORM OF TIME VESTING RESTRICTED  STOCK  UNIT  AWARD  AGREEMENT FOR SENIOR OFFICERS

Name Grant Date

Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan.

You have been granted as of the Grant Date set forth above,                      restricted stock units (“Restricted Stock Units”). Upon termination of the restrictions related thereto, each Restricted Stock Unit will be converted into one share of Avaya Inc. (“Avaya”) common stock, par value $.01 (“Shares”), subject to the terms and conditions of the Plan and this Agreement.

1.Vesting of Award.  The Restricted Stock Units shall vest and become nonforfeitable on the following schedule; 50% on the second anniversary of the Grant Date, and 50% on the third anniversary of the Grant Date (the date on which any Restricted Stock Unit vests being the “Vesting Date” for such Restricted Stock Unit).  The period beginning on the Grant Date hereof and ending on the day prior to the Vesting Date for a Restricted Stock Unit is herein referred to as the “Restriction Period” with respect to such Restricted Stock Unit.

2.  Termination of Employment.  Upon termination of your employment for any reason other than death, disability or termination under the Company’s Force Management Plan, each as described below, including without limitation, retirement and termination as a result of your employer ceasing to be either Avaya or a Subsidiary, any Restricted Stock Units that are not vested shall be forfeited and cancelled. Transfer to and from Avaya and any Subsidiary shall not be considered a termination of employment for purposes of this Agreement.  Nor shall it be considered a termination of employment for purposes of this Agreement if you are placed on an approved leave of absence, unless the Committee shall otherwise determine.

(a)Death - If you die prior to the Vesting Date, the Restricted Stock Units will become nonforfeitable, the Restriction Period will end and the award will be paid as soon as practicable after the date of death as specified in Section 3.

(b)Disability - “Disability” means termination of employment under circumstances where you qualify for and receive payments under a long-term disability pay plan maintained by Avaya or any Subsidiary or as required by or available under applicable local law.  Upon termination of your employment prior to the Vesting Date as a result of your Disability the Restricted Stock Units will become nonforfeitable, the Restriction Period will end and the award will be paid at time of termination as specified in Section 3.

(c)Force Management Plan (FMP) -  “FMP” means termination of employment under one of the Company’s Involuntary Separation Plans where the employee is placed “At Risk.”  “At Risk” means a Company initiated termination other than for cause.  “At Risk” does not include any termination that is caused by, as a result of or otherwise related to a “Change in Control” as defined in the Avaya Inc. Special Severance Plan.  If your employment is terminated under the FMP, the number of Restricted Stock Units under this Award that will vest will be determined by multiplying the number of Restricted Stock Units subject to this Award by a fraction, the numerator of which shall be equal to the number of complete months since the Grant Date you were employed by Avaya or any Subsidiary, and the denominator of which shall be equal to the number of complete months in the Restriction Period, and by subtracting from this product the number of Restricted Stock Units subject to this Award that vested prior to the date of termination without regard to this paragraph.

3.Payment of Shares.   As soon as practicable after termination of the Restriction Period, the Company will deliver a certificate representing the Shares being distributed to you or to your legal representative.

4.No Right of Employment.  Neither the Plan nor this Restricted Stock Unit Award shall be construed as giving you the right to be retained in the employ of Avaya or any Subsidiary.

5.Taxes.  Avaya shall deduct or cause to be deducted from, or collect or cause to be collected with respect to, your Restricted Stock Units any federal, state, or local taxes required by law to be withheld or paid with respect to your Restricted Stock Units, and you or your legal representative or beneficiaries shall be required to pay any

such amounts.  Avaya shall have the right to take such action as may be necessary, in Avaya’s opinion, to satisfy such obligations.

6.Beneficiary.  You may, in accordance with procedures established by the Committee, designate one or more beneficiaries to receive all or part of this award in case of your death, and you may change or revoke such designation at any time.  Such designation shall not be effective unless and until the Senior Vice President- Human Resources shall determine, on advice of counsel, that resale of Shares by your beneficiary(ies) does not require any registration, qualification, consent or approval of any securities exchange or governmental or regulatory agency or authority.  In the event of your death, any portion of this Award that is subject to such a designation (to the extent such designation is valid, effective and enforceable under this Agreement and applicable law) shall be distributed to such beneficiary or beneficiaries in accordance with this Agreement.  Any other portion of this Award shall be distributed to your estate.  If there shall be any question as to the legal right of any beneficiary to receive a distribution hereunder, or to the extent your designation is not effective, such portion will be delivered to your estate, in which event neither Avaya nor any Subsidiary shall have any further liability to anyone with respect to such award.

7.Transferability.  Unless otherwise provided for in the Plan, you may not transfer, pledge, assign, sell or otherwise alienate your Restricted Stock Units.

8.Confidentiality; Non-solicitation; Recoupment of Profits.

(a)You recognize and acknowledge that during your employment with Avaya you have had access to highly confidential and proprietary Company information and trade secrets (“Proprietary Information,” as described herein) and the use, misappropriation or disclosure of  Proprietary Information would cause irreparable injury to Avaya; and it is essential to the protection of Avaya’s good will and to the maintenance of Avaya’s competitive position that Proprietary Information be kept secret and that you not disclose  Proprietary Information to others or use any Proprietary Information to your own advantage or the advantage of any third parties.  For purposes of this Agreement, the term “Proprietary Information” shall include any and all information, in any form whatsoever, including but not limited to, hard copy, computer floppy diskette, CD, CD-ROM drive, information retained in electronic storage, or other information storage means, relating to Avaya’s technology; techniques; processes; tools; research and development; market research, data and strategy; and, information relating to sales, pricing and customers, including customer-specific sales information, pricing policies and strategies.

(b)You further recognize and acknowledge that it is vital for the proper protection of Avaya’s legitimate interests that during the term of your employment and for a period of one (1) year from the date of termination of your Avaya employment you may not directly or indirectly: (i) solicit, induce, or attempt to induce employees of Avaya or any affiliate of Avaya to terminate their employment with, or otherwise cease their relationship with Avaya or any affiliated company; or (ii)  solicit, induce, hire or attempt to solicit, induce or hire any employee of Avaya to work or provide services to any third party; or (iii) solicit to divert or take away or attempt to divert or to take away, the business or patronage of any of Avaya’s clients, customers or accounts, or prospective clients, customers or accounts.  Insofar as the restrictions set forth in this paragraph prohibit the solicitation, inducement or attempt to hire a licensed attorney who is employed at Avaya, they shall not apply to you if you are a licensed attorney and the restrictions contained herein are illegal, unethical or unenforceable under the laws, rules and regulations of the jurisdiction in which you are licensed as an attorney.

(c)You agree that if you violate the terms of this Section (a) or (b), this Agreement will be cancelled immediately in its entirety, and any benefit already paid out within twelve (12) months prior to Avaya’s notice to you of such violation shall, at the sole discretion of Avaya, be required to be repaid to Avaya within ten (10) business days of Avaya’s demand of you in writing.  Further, insofar as any violation of this Section (a) or (b) may cause harm or injury to Avaya which may not be calculable or remedial by way of monetary damages, you understand and acknowledge that Avaya may initiate an action in law or in equity to prevent you from engaging in any conduct which is in violation of this Section (a) or (b) and/or to initiate an action to recoup any and all profits you have earned as a result of this Agreement.

(d)If any restriction set forth in this Section is found by a court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend over the maximum period of time, range of activities or geographic areas as to which it may be enforceable.

(e)You understand and agree that the restrictions contained in this Section are necessary for the protection of the business and goodwill of Avaya and are expressly considered by you to be reasonable for such purpose.

9.Governing Law.  The validity, construction and effect of this Agreement shall be determined in accordance with the laws of the State of Delaware without giving effect to principles of conflicts of law.

10.Subject to Plan.  This Agreement and grant of Restricted Stock Units are subject to all of the terms and conditions of the Plan.

Please indicate your acceptance of terms 1-10, and acknowledge that you have received a copy of the Plan, as currently in effect, by signing at the place provided and returning the original of this Agreement.

ACCEPTED AND AGREED:	Avaya Inc.
SIGNATURE	BY

EX-10.3

Exhibit 10.3

Summary of the Avaya Inc. Non-Employee Director Compensation Program
(as of November 2, 2006)

The following amounts are payable to non-employee Directors of Avaya Inc. (the “Company”) in connection with their service on the Company’s Board of Directors (the “Board”):

·Upon becoming a member of the Board, each new non-employee Director receives an inaugural grant of restricted stock units having a total value on the date of grant of $50,000. The restricted stock units are placed in that Director’s deferred share account under the Company’s Deferred Compensation Plan, and, assuming they have vested, the underlying shares are distributed to that Director upon retirement from the Board.

·All non-employee Directors receive an annual retainer of $100,000.

·The non-executive Chairman of the Board receives an additional annual retainer of $35,000 for service in that role.

·The Lead Director of the Board receives an additional annual retainer of $25,000 for service in that role.

·The chairpersons of the following committees of the Board receive the following additional amounts for chairing those committees:

·	Audit	$20,000
·	Compensation	$10,000
·	Governance	$10,000
·	Finance	N/A

·Non-employee Directors receive the following additional amounts for serving as members of the following committees, which amounts are incremental for committee chairpersons:

·	Audit	$10,000
·	Compensation	$5,000
·	Governance	$5,000
·	Finance	$2,500

The retainers are payable as of March 1 of each fiscal year.  Directors do not receive separate meeting fees.

Non-employee Directors are required to elect to receive at least 50% of their retainers in the Company’s common stock, to be received either at the time of payment of their retainers or to be placed in their deferred share accounts under the Company’s Deferred Compensation Plan. Any remaining amounts may be paid in cash, but in no event is the cash paid permitted to exceed 50% of their retainers.

Directors can elect to defer all or part of the cash portion of their retainers under the Company’s Deferred Compensation Plan. The interest rate on cash deferrals is determined by the Board.

The Company also provides non-employee Directors with travel accident insurance when traveling in connection with Company-related business. The Company does not provide a retirement plan or other perquisites for non-employee Directors.  Directors have an opportunity to participate in the Avaya Product Program for Directors, in which certain Avaya products (specifically, an Avaya IP Office system for one location with up to 20 telephones) and associated maintenance services are provided at no charge; however, the equipment and the related maintenance is taxable as income to any Director that chooses to participate, and the Company provides a gross-up for the resulting taxes.

EX-99.1

Exhibit 99.1

Media Inquiries:	Investor Inquiries:
Lynn Newman	Matt Booher
908-953-8692 (office)	908-953-7500 (office)
908-672-1321 (mobile	mbooher@avaya.com
lynnnewman@avaya.com

FOR IMMEDIATE RELEASE: FRIDAY, NOVEMBER 3, 2006

Louis J. D’Ambrosio and Michael C. Thurk Elected to Avaya’s Board of Directors

Basking Ridge, N.J. — Avaya Inc. (NYSE:AV), a leading global provider of business communications applications, systems and services, today announced that Louis J. D’Ambrosio and Michael C. Thurk were elected to its board of directors, effective Nov. 2, 2006.

D’Ambrosio is Avaya’s President and Chief Executive Officer.  Thurk is the company’s Chief Operating Officer.

Before assuming their current positions in July, D’Ambrosio was Avaya’s Senior Vice President and President, Global Sales and Marketing, and Thurk was the company’s Senior Vice President and President, Global Communications Solutions.

About Avaya

Avaya Inc. designs, builds and manages communications networks for more than one million businesses worldwide, including more than 90 percent of the FORTUNE 500®. Focused on businesses large to small, Avaya is a world leader in secure and reliable Internet Protocol telephony systems and communications software applications and services.

Driving the convergence of voice and data communications with business applications — and distinguished by comprehensive worldwide services — Avaya helps customers leverage existing and new networks to achieve superior business results.  For more information visit the Avaya website: http://www.avaya.com.