SEC FORM 4

SEC Form 4

FORM 4

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934
or Section 30(h) of the Investment Company Act of 1940

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Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

1. Name and Address of Reporting Person^*

PUSEY STEPHEN CHARLES

(Last)

(First)

(Middle)

C/O NORTEL NETWORKS CORPORATION

8200 DIXIE ROAD, SUITE 100

(Street)

BRAMPTON

L6T 5P6

(City)

(State)

(Zip)

2. Issuer Name and Ticker or Trading Symbol
NORTEL NETWORKS CORP [ NT ]

5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)

	Director	10% Owner
X	Officer (give title below)	Other (specify below)
	(1) See Remarks

3. Date of Earliest Transaction (Month/Day/Year)
08/15/2006

4. If Amendment, Date of Original Filed (Month/Day/Year)

6. Individual or Joint/Group Filing (Check Applicable Line)

X	Form filed by One Reporting Person
	Form filed by More than One Reporting Person

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	3. Transaction Code (Instr. 8)		4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5)			5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4)	6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Security (Instr. 3)	2. Transaction Date (Month/Day/Year)	2A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	Amount	(A) or (D)	Price		6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	7. Nature of Indirect Beneficial Ownership (Instr. 4)
Common Shares	08/15/2006		J⁽¹⁾		77,630	D	$1.92	105,031	D
Common Shares								175,000⁽²⁾	D
Common Shares								500,000⁽³⁾	D

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	4. Transaction Code (Instr. 8)		5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5)		6. Date Exercisable and Expiration Date (Month/Day/Year)		7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4)		8. Price of Derivative Security (Instr. 5)	9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)	10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
1. Title of Derivative Security (Instr. 3)	2. Conversion or Exercise Price of Derivative Security	3. Transaction Date (Month/Day/Year)	3A. Deemed Execution Date, if any (Month/Day/Year)	Code	V	(A)	(D)	Date Exercisable	Expiration Date	Title	Amount or Number of Shares	8. Price of Derivative Security (Instr. 5)		10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4)	11. Nature of Indirect Beneficial Ownership (Instr. 4)
06/14/06 Grant of Options⁽⁴⁾	$2.12							⁽⁵⁾	06/13/2016	Common Shares	250,000		250,000	D
01/30/97 Grant of Options⁽⁶⁾	$8.8513							⁽⁷⁾	01/29/2007	Common Shares	13,336		13,336	D
01/29/98 Grant of Options⁽⁶⁾	$11.29							⁽⁷⁾	01/28/2008	Common Shares	29,336		29,336	D
09/23/99 Grant of Options⁽⁶⁾	$23.97							⁽⁷⁾	09/22/2009	Common Shares	32,000		32,000	D
01/29/02 Grant of Options⁽⁶⁾	$7.16							⁽⁷⁾	01/26/2010	Common Shares	46,666		46,666	D
01/29/02 Grant of Options⁽⁶⁾	$7.16							⁽⁷⁾	06/08/2010	Common Shares	33,333		33,333	D
01/29/02 Grant of Options⁽⁸⁾	$7.16							⁽⁷⁾	01/24/2011	Common Shares	33,333		33,333	D
01/29/02 Grant of Options⁽⁸⁾	$7.16							⁽⁷⁾	06/18/2011	Common Shares	56,250		56,250	D
02/28/02 Grant of Options⁽⁶⁾	$5.15							⁽⁷⁾	02/27/2012	Common Shares	125,000		125,000	D
02/28/02 Grant of Options⁽⁶⁾	$5.15							⁽⁷⁾	02/28/2008	Common Shares	500,000		500,000	D
11/22/05 Grant of Options⁽⁶⁾	$3.07							⁽⁵⁾	11/21/2015	Common Shares	875,000		875,000	D

Explanation of Responses:

1. Common shares of Nortel Networks Corporation (NNC) surrendered by the officer for cancellation in accordance with the escrow agreement dated as of March 1, 2005 among NNC, Computershare Trust Company of Canada et al, in connection with the voluntary undertaking by the officer to pay over a three year period an amount equal to the return to profitability bonus paid to the officer in 2003, net of tax deductions at source, as set forth in a letter of undertaking dated January 10, 2005 as modified by a letter dated as of March 1, 2005.

2. Restricted stock units awarded pursuant to the Nortel 2005 Stock Incentive Plan that vest in three equal annual installments beginning on June 14, 2007 and are settled in Nortel Networks Corporation common shares upon vesting, net of tax withholding.

3. Restricted stock units awarded pursuant to the Nortel 2005 Stock Incentive Plan that vest in three equal annual installments beginning on November 22, 2006 and are settled in Nortel Networks Corporation common shares upon vesting, net of tax withholding.

4. The reported options were granted pursuant to the Nortel 2005 Stock Incentive Plan.

5. The reported options vest in four equal annual installments beginning on the first anniversary of the date of grant.

6. The reported options were granted pursuant to the Nortel Networks Corporation 1986 Stock Option Plan As Amended and Restated (the "1986 Stock Option Plan").

7. The reported options are currently vested.

8. The reported options were granted pursuant to the Nortel Networks Corporation 2000 Stock Option Plan.

Remarks:

(1) Executive Vice President and President, EMEA

	T.S.J. Connelly McGilley, Attorney for Stephen Charles Pusey	08/16/2006
	** Signature of Reporting Person	Date
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