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Commission File Number: 001-38289
CUSIP Number: 05351X101
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
_____________________
FORM 12b-25
_____________________
NOTIFICATION OF LATE FILING
(Check One) ☐
Form 10-K
☐
Form 20-F
☐
Form 11-K
☒
Form 10-Q
☐
Form 10-D
☐
Form N-SAR
☐
Form N-CSR
For Period Ended: December 31, 2022
☐
Transition Report on Form 10-K
☐ Transition Report on Form 20-F
☐ Transition Report on Form 11-K
☐ Transition Report on Form 10-Q
☐ Transition Report on Form N-SAR
For the Transition Period Ended:
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Read Instruction (on back page) Before Preparing Form. Please Print
or Type.
Nothing
in this form shall be construed to imply that the Commission has
verified any information contained herein.
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If the notification relates to a portion of the filing checked
above, identify the Item(s) to which the notification
relates:
PART I – REGISTRANT INFORMATION
AVAYA HOLDINGS CORP.
(Full
Name of Registrant)
(Former Name if Applicable)
2605 Meridian Parkway, Suite 200
(Address
of Principal Executive Office (Street
and Number))
Durham, North Carolina 27713
(City,
State and Zip Code)
PART II – RULES 12b-25(b) AND (c)
If the subject report could not be filed without unreasonable
effort or expense and the registrant seeks relief pursuant to Rule
12b-25(b), the following should be completed. (Check box if
appropriate)
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(a)The
reason described in reasonable detail in Part III of this form
could not be eliminated without unreasonable effort or
expense;
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(b)The
subject annual report, semi-annual report, transition report on
Form 10-K, Form 20-F, Form 11-K, Form N-SAR or Form N-CSR, or
portion thereof, will be filed on or before the fifteenth calendar
day following the prescribed due date; or the subject quarterly
report or transition report on Form 10-Q or subject distribution
report on Form 10-D, or portion thereof, will be filed on or before
the fifth calendar day following the prescribed due date;
and
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(c)The
accountant’s statement or other exhibit required by Rule 12b-25(c)
has been attached if applicable.
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PART III – NARRATIVE
State below in reasonable detail why Forms 10-K, 20-F, 11-K, 10-Q,
10-D, N-SAR, N-CSR, or the transition report or portion thereof,
could not be filed within the prescribed time period.
Avaya Holdings Corp. (the “Company”) is unable to file, without
unreasonable effort and expense, its Quarterly Report on Form 10-Q
for the quarterly period ended December 31, 2022 (the “Form
10-Q”).
As previously disclosed in the Company’s NT 10-Q filed with the
U.S. Securities & Exchange Commission (the “SEC”) on August 9,
2022 (the “Q3 NT 10-Q”) and the Company’s NT 10-K filed with the
SEC on November 30, 2022, Part III of which is incorporated herein
by reference, the audit committee (the “Audit Committee”) of the
Company’s board of directors commenced an internal investigation to
review, among other things, the circumstances surrounding the
Company’s financial results for the quarter ended June 30, 2022.
The Audit Committee’s investigation into the Company’s financial
results for the quarter ended June 30, 2022 remains on-going.
Following the Company’s notification to the SEC of the Audit
Committee’s investigation, as noted in the Company’s Q3 NT 10-Q,
the Company has been fully cooperating with the SEC’s
investigation, which the Company expects to remain on-going for
some time.
As previously disclosed in a Form 8-K filed on November 30, 2022,
the Company determined that material weaknesses existed in its
Internal Control Over Financial Reporting (“ICFR”) and that
disclosure controls and procedures were not effective as of
September 30, 2021, which continues to be the case. The Company is
assessing a potential material weakness related to designing and
maintaining an effective control environment and to the setting of
an appropriate “tone at the top.” Management is actively engaged in
taking steps necessary to remediate the control deficiencies that
constituted the material weaknesses discussed above. The Company is
committed to transforming its culture to embrace transparency and
open communication and the following personnel changes have
occurred:
-On
July 28, 2022, Avaya removed James M. Chirico, Jr. as Chief
Executive Officer and appointed Alan Masarek as new Chief Executive
Officer, effective August 1, 2022;
-It
was determined that Stephen Spears would step down from his role as
Chief Revenue Officer on October 18, 2022 and departed the Company
effective November 1, 2022;
-Kieran
McGrath, stepped down as Chief Financial Officer, effective
November 9, 2022, and retired from the Company, effective December
1, 2022; and
-Avaya
appointed Rebecca A. Roof as Interim Chief Financial Officer,
effective November 9, 2022.
There may be additional material weaknesses identified in the
Company’s ICFR.
The Company is also continuing to complete its assessment of the
impairment charges
related to the Company’s long-lived assets as well as its
intangible assets, including the Avaya Trade Name and the goodwill
related to the Company’s Services reporting unit for each period
for which the Company has yet
to file a periodic report. As disclosed in Q3 NT 10-Q,
the Company expects to record a goodwill impairment charge of
approximately $1,175 million to $1,471 million and an
impairment charge of approximately $97 million to $333 million for
its indefinite-lived intangible asset, the Avaya Trade
Name.
As a result of the foregoing and other closing activities, the
Company requires additional time to complete its review of its
financial statements and other disclosures as of and for the
applicable periods ended June 30, 2022, September 30, 2022 and
December 31, 2022, and to complete its closing processes and
controls, and is unable to file its Quarterly Report on
Form 10-Q for the period ended December 31, 2022 on or prior
to the prescribed due date of February 9, 2023. The Company does
not currently anticipate that it will be able to file that Form
10-Q on or before the fifth calendar day following the February 9,
2023 prescribed filing date as a result of the circumstances
described above. The Company will seek to resolve these issues as
soon as practicable and plans to file the Form 10-Q as soon as
possible.
As previously disclosed, each of the Company’s term loan facility
and ABL facility contains a covenant that requires the Company’s
(or Avaya Inc.’s) audited financial statements be provided to the
applicable lenders on or before December 29, 2022, which audited
financial statements shall be audited by an independent registered
public accounting firm of recognized national standing whose
opinion shall not be qualified as to the scope of audit or as to
the status of the audit entity and its consolidated subsidiaries as
a going concern (other than an exception with respect to a current
maturity date of any indebtedness or any actual or prospective
default of a financial maintenance covenant). Such audited
financial statements have not, as of this date, been delivered to
the applicable lenders. The Company has 30 days to cure a failure
to deliver such compliant financial statements after receipt of
written notice from the administrative agent of the applicable
facility. As of the date of this notification, the Company has not
received such notice. The Company continues to have constructive
dialogue with its creditors about the parameters of restructuring
the Company’s capital structure, which may likely be effectuated in
the near-term and take the form of an in-court restructuring for
the Company and its domestic subsidiaries.
PART IV – OTHER INFORMATION
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(1) |
Name and telephone number of person to contact in regard to this
notification |
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Rebecca A. Roof |
(908) |
953-6000 |
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(Name) |
(Area Code) |
(Telephone Number) |
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(2) |
Have all other periodic reports required under Section 13 or 15(d)
of the Securities Exchange Act of 1934 or Section 30 of the
Investment Company Act of 1940 during the preceding 12 months or
for such shorter period that the registrant was required to file
such report(s) been filed? If answer is no, identify
report(s).
☐
Yes
☒
No
The Company has not yet filed its quarterly report on Form 10-Q for
the period ended June 30, 2022 or its annual report on Form 10-K
for the year ended September 30, 2022.
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(3) |
Is it anticipated that any significant change in results of
operations from the corresponding period for the last fiscal year
will be reflected by the earnings statements to be included in the
subject report or portion thereof?
☒
Yes
☐
No
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If so, attach an explanation of the anticipated change, both
narratively and quantitatively, and, if appropriate, state the
reasons why a reasonable estimate of the results cannot be
made.
The Company expects to report a significant decline in revenue as
well as significant impairment charges related to its intangible
assets, and consequently, will report a significant decrease in
operating income and a significant increase in net loss, for the
quarter ended December 31, 2022 as compared to the quarter ended
December 31, 2021. It is expected that preliminary unaudited
revenues for the quarter ended December 31, 2022 are in the range
of $418 to $423 million.
However, the Company is unable to provide reasonable estimates
of
gross profit, operating income and net loss or the amount of the
impairment charges at this time as the Company continues to focus
on completing the Audit Committee investigation noted above and has
not completed its financial close process and controls for the
applicable period.
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Cautionary Note Regarding Preliminary Financial
Information
All financial results for the three months ended December 31, 2022
included above are preliminary, have not been reviewed or audited,
are based upon the Company’s estimates, and were prepared prior to
the completion of the Company’s financial statement close process.
The preliminary financial results should not be viewed as a
substitute for the Company’s full first quarter results, do not
present all information necessary for an understanding of the
Company’s financial performance as of December 31, 2022 and should
not be considered final until the Company files its Quarterly
Report on Form 10-Q for the quarter ended December 31, 2022. During
the course of the preparation of the Company’s financial statements
as of and for the three months ended December 31, 2022, the Company
may identify items that could cause its final reported results to
be materially different from the preliminary financial information
set forth above. Accordingly, undue reliance should not be placed
on this preliminary data.
Cautionary Note Regarding Forward-Looking Statements
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This notification on Form 12b-25 contains certain “forward-looking
statements.” All statements other than statements of historical
fact are “forward-looking” statements for purposes of the U.S.
federal and state securities laws. These statements may be
identified by the use of forward-looking terminology such as
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“intend,” “may,” “might,” “our vision,” “plan,” “potential,”
“preliminary,” “predict,” “should,” “will,” or “would” or the
negative thereof or other variations thereof or comparable
terminology. These forward-looking statements are subject to a
number of factors and uncertainties that could cause our actual
results to differ materially from those expressed in or
contemplated by the forward-looking statements. Such factors
include, but are not limited to, finalization of the Company’s
annual and quarterly financial statements (including finalization
of the Company’s impairment tests),
completion of standard annual and quarterly-close processes, the
Company’s ability to address the convertible notes that mature in
June 2023 and continue as a going concern, the risk of an event of
default under one or more of the Company’s senior debt facilities,
including as a result of the Company’s failure to timely finalize
its annual and quarterly financial statements
and a potential delisting of the Company’s common
stock,
the impact of litigation and regulatory proceedings, the impact and
timing of any cost-savings measures, the risk that additional
material weaknesses are identified prior to the filing with the SEC
of future periodic reports, future whistleblower complaints that
are not properly logged or communicated across management, as well
as inherent limitations in internal controls over financial
reporting, the outcome of the Audit Committee’s
investigation,
the ability of the Company to regain compliance with the NYSE
listing requirements, future compliance with such requirements,
potential future application of suspension and delisting procedures
and future quotation of the Company’s common stock,
the result of ongoing discussions with the Company’s creditors
regarding a restructuring and the nature of the in-court
restructuring itself, including a Chapter 11 filing under the U.S.
Bankruptcy Code. Other risk factors affecting the Company are
discussed in the Company’s Annual Report on Form 10-K and
subsequent quarterly reports on Form 10-Q filed with the SEC. These
risks and uncertainties may cause the Company’s actual results,
performance, liquidity or achievements to differ materially from
any future results, performance, liquidity or achievements
expressed or implied by these forward-looking statements. For a
further list and description of such risks and uncertainties,
please refer to the Company’s filings with the SEC that are
available at www.sec.gov. The Company cautions you that the list of
important factors included in the Company’s SEC filings may not
contain all of the material factors that are important to you. In
addition, in light of these risks and uncertainties, the matters
referred to in the forward-looking statements contained in this
notification may not in fact occur. The Company undertakes no
obligation to publicly update or revise any forward-looking
statement as a result of new information, future events or
otherwise, except as otherwise required by law.
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AVAYA HOLDINGS CORP.
(Name
of Registrant as Specified in Charter)
has caused this notification to be signed on its behalf by the
undersigned hereunto duly authorized.
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Date |
February 10, 2023 |
By: |
/s/ Rebecca A. Roof |
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Name: |
Rebecca A. Roof |
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Title: |
Interim Chief Financial Officer |
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