HIGHLIGHTS OF THE TENTATIVE AGREEMENT BETWEEN CWA AND LUCENT

TECHNOLOGIES

CONSOLIDATED WORKERS AND INSTALLATION AGREEMENTS

National Items -

The contract is a 7 year and 7 month Agreement that will expire

on May 26, 2012.

Signing Bonus - A $1,000 signing bonus will be paid to anyone

who is on roll effective November 1, 2004 if the collective

bargaining agreement is ratified. The bonus will be payable 4

weeks after the date of ratification.

Wages - A general wage increase will be applied to all wage

schedules, effective the last week in May, for each year of the

collective bargaining agreement. The wage increases total 16.28

percent compounded over the life of the collective bargaining

agreement. A cost of living adjustment will apply for years 2008

and beyond based upon a formula agreed to by the parties.

Pension Band Increase - All pension bands will be increased by

12 percent on July 1, 2005. Anyone who retires or leaves the

company between November 1, 2004 and June 30, 2005 will have

their pension band increased effective July 1, 2005.

Lucent Performance Award - The maximum on the Business Unit

Award has been raised from $750 to $1,000. The amount at

target for both the Lucent award and the Business Unit award has

been raised each year by approximately 2%.

Alliance - Funding will be continued; however, due to the

declining number of employees, the total Company contribution

will be less.

Long Term Savings and Security Plan -

Eligibility to participate in the plan has been reduced from 1

year to six months.

Participant's contribution will be changed from a flat dollar

amount to a percentage of pay. The Company match remains the

same at 66 2/3 percent of up to 6 percent of your contributions.

Residential loan feature has been added with up to 175 months to

repay.

Health Care for Active and Retirees - Both active employees and

retirees will have modifications to the Health Care plan design

plus modest premiums.

Premiums for active employees for 2005-2008 will be $15 for

single coverage and $30 for family coverage. Premiums for

active employees for 2009-2011 will be $30 for single coverage

and $45 for family coverage. Premiums for active employees for

2012 will be $45 for single coverage and $60 for family

coverage.

Premiums for post 3/1/90 retirees who are pre 65 will be 3% of

their monthly pension for single coverage and 5% of their

monthly pension for family coverage. Premiums for post 3/1/90

retirees who are post 65 will be 2% of their monthly pension for

single coverage and 4% of their monthly pension for family

coverage.

There will be plan design changes that will be spelled out in

the final bargaining report.

Domestic Partner Benefit Coverage - Improved to include opposite

sex partners as well as same sex partners.

Military Leaves of Absence - Enhancements were made to the

maximum amount of leave time as well to the pay differentials.

ERC/LTP Coordinator - The job match center work will be

transitioned into the ERC/LTP coordinator role of

responsibilities.

CONSOLIDATED WORKERS AGREEMENT -

* The Five Tier clerical universe will be collapsed into a Four

Tier universe with a merger of corridors. There will be six

upgrades into the Tier Five and two upgrades into Tier 3.

* A joint workplace improvement council will be established at

the Merrimack Valley Works to deal with issues surrounding the

merger and collapsing of Tiers as well as other issues pertinent

to Merrimack Valley.

* An Agency Temporary Agreement was reached allowing the Company

the flexibility to utilize former employees in peak situations

while guaranteeing no lay offs for the duration of the usage of

the agency temps.

* Waiting time between lateral transfers in the Production and

Maintenance universe will be reduced to 6 months.

* The transferring wage rate in the Charlotte facility has been

improved from step 10 of the wage schedule to step 14.

* Recall rights for Bell Labs employees has been improved from 2

years to 3 years effective January 1, 2004.

* Tie Back rights were established for Operational employees who

were involuntarily moved from one organization to another within

the last three months for the life of the collective bargaining

agreement.

* Bell Labs Training/Mentoring Program - A committee will be

established to facilitate training programs such as

apprenticeship, mentoring, web based and/or classroom programs.

INSTALLATION -

Job Security

* Installers on the active roll as of the date of signing

Installation CWA-24 and Installers recalled or hired as a result

of the one time Voluntary Severance Offer (SVO) shall not be

laid off for the duration of this contract.

* The MOU on page 181, Permanent Transfers Necessitated By

Surplus Conditions is removed from CWA-24.

* Within 90 days of ratification of CWA-24 the Company will make

a one time special voluntary severance offer (SVO) to all

installers on roll as of the effective date of this Agreement.

There will be no force adjustments, including permanent

transfers, made during this period. The amount of the severance

offer shall be equal to the layoff allowance in Article 20 to

which the employee would be entitled or seventy-five thousand

dollars ($75,000) whichever is less. The Company may cap the

number of installers who may elect to accept the severance offer

and may delay the off-roll date for reasons of knowledge

transfer; however, such Installer must be off roll within 12

months.

* In the event the total number of Installers who accept the SVO

reduces the number remaining on the roll to fewer than 1,500,

the Company shall immediately recall or hire Installers on a

one-time basis such that the number of ACST, CST and SCST

Installers is equal to 1,500.

* A new job title, Service Communications Installer, with a pay

rate of $10 to $14.50 per hour with all installation travel

allowances and medical insurance. This new SC1 title will only

perform work at the 321 skill level and will not be assigned as

Lead Installer. The new title is created to allow the Company to

compete for low level Installation work. Former Installers who

were laid off shall have first preference to these jobs without

forfeiting recall rights to their previous title.

MILEAGE ARTICLE 13

* There will be two mileage adjustments in the life of the

contract. On October 2, 2005, an increase to 0.375 per mile or

the IRS allowable whichever is less. On October 5, 2008, an

increase to 0.39 per mile, or the IRS allowance whichever is

less.

PER DIEM INCREASE

* Increases Effective October 2, 2005 and October 5, 2008

Lodging 65-150:

Cat I - 0.30

Cat II - 0.35

Cat III - 0.40

Lodging 150+:

Cat I - .35

Cat II - .45

Cat III - .50

OTS MEMORANDUM OF UNDERSTANDING

* Core Installers in an affected base location with more than 10

years of service will be eligible for consideration to join the

OTS organization if an OTS Installer with a security clearance

will be impacted by layoff.

ARTICLE 20 - ADJUSTMENT TO THE WORKFORCE

* If an employee has been laid off in violation of the agreement

the employee would receive up to nine months back pay less

interim earnings.

ARTICLE 16 PAR 5 (d) - DEATH IN THE FAMILY

* Improvement in paid time off for an Installer who has a death

in the family and who has received a Special Condition Transfer.

ARTICLE 23 - DEDUCTION OF UNION DUES

* The Company must make every reasonable effort to get the Union

dues remitted to the correct Local once an Installer is

permanently transferred.

ARTICLE 13.2(i)(1)(ii)

* Employees with less than 10 years of service who decline a

Permanent Transfer will now receive a layoff allowance. The

declination of a Permanent Transfer layoff allowance is now

increased to $30,500.

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