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Please
click here to download the worksheet for calculating the tax basis for your
Alcatel-Lucent American Depositary Shares (ADSs) and/or cash-in-lieu received
in the exchange for Lucent common stock.
The merger was intended to qualify as a tax-free reorganization under
Section 368(a) of the Internal Revenue Code of 1986, as amended, for U.S.
federal income tax purposes. As a result, Alcatel Lucent and Lucent
believe that you will not recognize gain or loss on the exchange of your Lucent
common stock for Alcatel Lucent ADSs, although gain or loss may be recognized
upon the receipt of cash in lieu of a fractional ADS. Alcatel Lucent and
Lucent cannot assure you that the Internal Revenue Service will agree with the
treatment of the merger as a tax-free reorganization. Tax matters are
complicated, and the tax consequences of the merger to each Lucent shareowner
will depend on the facts of each shareowner's situation. Lucent
shareowners are urged to read the discussion set forth in the proxy statement
related to the merger under the heading "The Merger – Material U.S. Federal
Income Tax Consequences" and to consult their own tax advisors for a full
understanding of the tax consequences of their participation in the
merger. A copy of the proxy statement was mailed to shareowners prior to
the September 7 Lucent shareholder meeting and is also available on the
Internet at 
http://www.sec.gov/Archives/edgar/data/886125/000095012306009919/y20140a1fv4za.htm.
The tax discussion begins on page 85.
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