Thread regarding Avaya layoffs

@19v so true. Well said.

Who in the world are these clowns who have worked for corporate america their entire career yet don't understand the first thing about corporate america?

Alan Masarek did not have a choice. Period. His only option was for them to help him save face from joining the house of cards and make him appear to be a sc--wed negotiator to secure the $10m bribe to allow the BK to go forward without an ugly fight that he had little chance of overcoming.

AND - I recall people on here coaching us to expose and fight, especially when interim CFO showed up (she had just been run out by an employee uprising at an EV company that was trying to avert PE takeover via forced Bankruptcy). You had your chance. You didn't take it. So now you are angry because all of your criticas were spot on about how clueless you were (yes marketing evangelical looney tunes whack-a-doos, I'm talking to you).

[Watched a documentary about Delta on a Delta ✈️? 🤔🧐🤨?]
Marketing propaganda, anyone?

• Majority of Avaya employees between 2019-2023 didn't get it. About 20% were excellent long tenured (over 10 yrs) who were holding on and not trying to rock the boat, even if they knew it was a house of cards. The other 80% were sales and marketing puppets who would play the game mindlessly. 2017-2019 there was real hope. That was when the market wasn't so saturated. Avaya had exited bankruptcy, gotten free from the handcuffs of Private Equity. Avaya wasn't perfect. Solutions were stalled due to C Suite being more focused on making billions in a sale than R&D; thereby stifling all excellent talent. By the end of 2019, we had a mass exodus of the remaining talent in Product, R&D and marketing & CTO leadership*.

Shortly thereafter we got that clown from Gartner, who was more concerned with puppeting hashtag # words over ever really understanding the realities of Avaya. C Suite didn't mind, as it was a Smoke & Mirrors game of "look there not here". In quick order marketing became a collection of the land of misfit dolls. And that's when things became outright dangerous. These people believed their marketing narratives and publicly stated things that are flat out against the law when publicly traded (forward looking statements, etc).

If any of those disciples still believe that Avaya could have been saved due to loyal employees, buyer beware. If they can't evolve by now, they are flat out hopeless. AM could have saved Avaya, ONLY if the Board hired him 6 mos prior. The leveraged loan hijacking occured before his tenure. That hijacking couldn't be reversed. Your venom should be at Chirico, even if you want to like Chirico for selfish reasons. It was ALL Chirico and his BFF from his Seagate days, McGrath. Period.

Fill in the blank

[Name a company that had SEC Reporting violations, leveraged debt but Prevailed simply because they had 'loyal employees']

🦗🦗 🦗🦗🦗

@vm
Oh Nellie! 😲. I live in Atlanta and am very proud of Delta. Yet there is literally not one comparison to that scenario and Avaya's demise.

Firstly, SEC governing rules are way different now than they were when Delta has to restructure debt.

Second, Avaya knew Apollo was targeting them for years. Why do you think they passed on the Mitel merger offer on 2019? Why do you think they made the deal with Ring? It wasn't the marketing story of it all....that was just to justify the situation. They needed cash from Ring. Ring needed the access to Avaya Base. But where they sc--wed up was not selling Avaya prior to 2022. They should have sold. But they were greedy. Yet they were turning into pumpkins. The gig was up. They ran out of places to hide. They could have sold for $3-4b, easily. They chose not to. Kept hoping for double digits. And then they turned into a pumpkin. And the pumpkin exploded and ki-led everyone inside and created loads of exterior damage to countless others

And Delta is still fighting to get back because of the cost cuts impact on communications, maintenance and continuity. They are not smiling and happy people. "Despite these successes, Delta has faced, and sometimes struggled with, significant technology-driven, "snowball effect" operational meltdowns in later years, highlighting ongoing challenges in complex system maintenance"

@vm WooooooW! Did you really just say this?

AM came in and made a lot of ambitious promises, fired up the employees (and partners), but unfortunately for both he is a man without integrity or honor, and he chose accordingly

Trust me. I don't subscribe to the CEO-ego and the games they play, but the problem wasn't AM doing what he was paid to do. It was on the utterly CLUELESS Employees who actually believed Avaya was financially sound and that the marketing spin was real. I wonder if anyone in marketing or sales at the time ever insisted on PROOF of the size of the base or the real revenue value of a deal. Oh yes. I know the answer. YES. I did. I knew. I asked. I was condescended to when I asked. I had clients whom I saw on reports of the installed base that had left Avaya 2 years before I joined. They had 2-3 phones installed. That was it. But they were big names and Avaya kept their logos on the mainstage presentations.

Honestly, it's posts like this that remind me to not feel bad for those who drank the Jesus juice Kool aid.

The real crime began in 2019 when the subscription game was enacted. It was a total con. I at least knew it at the time. Shocked at how many still don't get it when it has all proven itself. It wasn't real. It was vapor.

@vm
YOU ARE HISTORICALLY DISNEY -ESQ with that foolish response.
You clearly did read the previous posters comments.

The C-Suite and BoD had MULTIPLE SEC VIOLATIONS (SEC case against Avaya is still ongoing). Masarek wanted to turn the company around, however, Apollo refused to allow that. Had Masarek decided to do the "Disney" character mindset, Apollo would have handed over the recovered information and Avaya would have been forced to Liquidate and cease operations.

No amount of loyal employees changes hard, core facts. The numbers were. Not. There. Period. You can't evangelize your way to SEC Filings. No marketing soon changes hard numbers. The numbers were not there. They had abused a back-door accounting technique via subscription math that afforded them a vehicle to hide the truths since 2019.

When you all were celebrating the stock price, it was based on lies and projections. After 3 years of false numbers, they had nowhere to turn. Apollo bringing Avaya private enabled them to write off debt with the Chapter 11 and then HIDE real #s because they don't have to publicly report them.

Masarek did not know HOW BAD it was when he joined. He believed the installed base was much more valuable and not a house of cards. All the facts below are accurate. I spent some time verifying that post and it is very very clear. Masarek was cornered. The C suite lies were criminal. He inherited the false accounting and he couldn't get out from under it because Apollo would have exposed it.

AM always had a choice, he wasn't forced to do anything. I watched a documentary recently on a Delta flight - A Century of Flight. (https://youtu.be/59cLxHGD5qI?si=8rbeHnkyUrj1SwQY). AM had the same kind of loyal employees as those in this documentary. AM came in and made a lot of ambitious promises, fired up the employees (and partners), but unfortunately for both he is a man without integrity or honor, and he chose accordingly. I still believe Avaya's story could have been much different, but the story turned out to be the exact opposite of Delta Airlines story because of AM's choices. This is his legacy, no amount of money can erase that.

• August 9, 2022 SEC 12b-25*
  NOTIFICATION OF LATE FILING

"Furthermore, and separately [from the delayed 10-Q SEC Earnings Report Filing] the Audit Committee has also commenced an internal investigation to review matters related to a whistleblower letter that remains ongoing."

https://www.sec.gov/Archives/edgar/data/1418100/000141810022000083/formnt10-q3q22.htm

Sooooo @a5, The @SEC NEVER Stepped in. Apollo is who "stepped in" by creating an entrapment to force Alan Masarek's hand into allowing the Chapter 11 so they could steal equity and take Avaya private.

TIMELINE REMINDER

• 1. The Subscription game-- which was a risky short-term strategy to falsely inflate the Market Valuation of Avaya so the greedy BoD and C-Suite could sell Avaya for north of $5b -- caught up to them and they had nowhere to hide in March 2022. Now IF they could book an enormous deal they could have extended the charade for another few quarters. That deal was to be Wells Fargo, if memory serves. So they delayed earnings in hopes to find an accounting workaround to explain away the unexplainable math that was the earnings reality. NOTE -- They spent since late 2019 fudging the numbers based on an algorithm of subscription-economy math that assumed a set value for each base client multiplied by market potential for signing the base clients to a subscription plan. THESE WERE NOT REAL #'s!!! For many quarters they could escape scrutiny b/c maintenance contracts were still collecting money. But when the first round of the 3 yr subscription deals were up, they were left with evaporated maintenance deals and accelerated client departures. It was one large empty hole.
• 1. In May 2022, the situation hit severe crisis status. There was no explaining away the #s. They needed more than just one enormous deal. The Slippery Slope Subscription game was now a runaway train. The BoD knew they needed something extreme to buy time to avoid being exposed for the 3.5 yr con-game of pretending that the marketing soundbytes of the "subscription economy" translated into real revenue. They initiated the age-old strategy of the CEO-Shuffle and began an aggressive search to name a new CEO before they had to face yet another SEC filing delay. They begin talks with Masarek in May. Hire him in June. Announce him in July. Masarek is up for the challenge and confident he can stabilize Avaya by December .....HOWEVER

--3. Apollo Global deploys a leveraged lending takeover plan. It was an unofficial hostile takeover. They are able to secure some of the leveraged lending related to Avaya loans, yet not enough to execute a hostile takeover. So they instead devise a plan to make things so uncomfortable for Avaya leadership that they will just give in. They deploy their go-to auditing firms and dirty PR spin-doctors to both a) find dirt on Avaya to use as leverage; and b) entrap Avaya via auditing. This included names like Alix Partners.

1. August 2022 -- Internal Audit discloses that Avaya lacked Internal Controls due to a broken process of formally investigating Ethics and Corporate Compliance reports. One example was a "Whistleblower" which filed a formal complaint months (maybe even a year) prior questioning accounting documentation of subscription deals and the risk to the overall business. At the time of the report, it was Shefali Shah's responsibility to ensure the complaint was properly and formally investigated. Instead, it was never even pursued. The independent auditing firm identified the breach of protocol that must be followed by any publicly traded company. Therefore, they were obligated by law to report the breach of protocol to the SEC in their next "we still can't file earnings" extension filing. This is called an "ICFR Weakness

• 1. November 28, 2022 SEC FORM 8-K Avaya Admits to Lack of Internal Controls based on result of investigation. This essentially states that they violated SEC Rules by not pursuing the whistleblower complaint, however stops short that the complaint itself qualified as a whistleblower concern. "The deficiencies in internal control over financial reporting (ICFR) represented “material weaknesses,” the cloud technology company said in a filing with the Securities and Exchange Commission (SEC)

Avaya discloses ICFR weaknesses linked to whistleblower logs Compliance Week

https://www.complianceweek.com/accounting-and-auditing/avaya-discloses-icfr-weaknesses-linked-to-whistleblower-logs/32407.article

1. DECEMBER 2022 Apollo now believes they have Avaya cornered to give in to a Chapter 11 so they could go private and Apollo can deploy their tried and true law firms to manage the filing in their favor. Yet Alan Masarek was not giving in. So Apollo spent December 2022 maneuvering to force AMs hands. The end result of paying AM $10m ($6 m retention bonus so he would stay despite looming bankruptcy & $4m of his original sign-on bonus that he was required to use to buy Avaya shares. They waived that requirement and he was allowed to keep the money as cash. They also awarded Shefali Shah $1.2m as they needed her to help them go after Jim Chirico if that was necessary.

   Avaya CEO To Get $6 Million Cash Award As Potential Bankruptcy Looms https://www.channelfutures.com/regulation-compliance/avaya-ceo-to-get-6-million-cash-award-stock-falls-below-nyse-minimum

SO @ab IS SPOT IN. THE WHISTLEBLOWER WAS REAL. IT WAS THE EVERYHING. without that Whistleblower report Internal Controls Snafu, Apollo wouldn't have had the chance to deploy their gremlins to force AM into a takeover (also known as conspired Chapter 11).

There was an official "whistleblower" reported....
It was someone who reported a concern to the board and shefali shah hid it under the rug. The auditing firm found it and used it as part of the leveraged takeover.

HAD THAT WHISTELBLOWER cover up not occurred, Apollo wouldn't have been able to strong arm Masareck into forced Bankruptcy

IT WAS SIGNIFICANT

What are you even talking about? Why would the SEC need a whistleblower for something that was already out in the open? There were like half a dozen private lawsuits filed nearly two years before the SEC stepped in.