COMPENSATION OF PHILIPPE CAMUS AND BEN VERWAAYEN

Philippe Camus’ compensation as Alcatel-Lucent non-executive Chairman

• Yearly fixed compensation of 200,000€
• A 100,000 restricted shares grant in September 2008 (to be earned upon performance criteria)

Ben Verwaayen’s compensation as Alcatel-Lucent Chief Executive Officer

• Yearly fixed compensation of 1,200,000€
• Target annual bonus of 150% of fixed salary (payout can range between 0% to 200% of that target based on agreed performance yearly criteria).
• The Company shall grant the CEO 1,000,000 share options in the first quarter of 2009. Ben Verwaayen will receive an initial option grant of 250,000 shares in September 2008. Options will vest upon performance criteria.
• A 250,000 restricted shares grant in September 2008 (to be earned upon performance criteria)
• No cash severance benefits upon his termination of employment with the Company, whether for cause or without cause.