Document:

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                                                                     EXHIBIT 4.4

                           WHITEHALL JEWELLERS, INC.

                          EMPLOYEE STOCK PURCHASE PLAN

                  1. PURPOSE. The purpose of the Whitehall Jewellers, Inc.
Employee Stock Purchase Plan (the "Plan") is to provide employees of Whitehall
Jewellers, Inc., a Delaware corporation (the "Company"), and its Subsidiary
Companies (as defined below) added incentive to remain employed by such
companies and to encourage increased efforts to promote the best interests of
such companies by permitting eligible employees to purchase shares of common
stock, par value $.001 per share, of the Company ("Common Stock") at
below-market prices. The Plan is intended to qualify as an "employee stock
purchase plan" under section 423 of the Internal Revenue Code of 1986, as
amended (the "Code"). For purposes of the Plan, the term "Subsidiary Companies"
shall mean all corporations which are subsidiary corporations (within the
meaning of Section 424(f) of the Code) and of which the Company is the common
parent. The Company and its Subsidiary Companies that, from time to time, adopt
the Plan are sometimes hereinafter called collectively the "Participating
Companies."

                  2.  ELIGIBILITY.  Participation in the Plan shall be open to
each employee of the Participating Companies who satisfies all of the following
conditions (an "Eligible Employee"):

                  (a)      such employee's customary employment is for more than
                           20 hours per week;

                  (b)      such employee's customary employment is for more than
                           5 months per calendar year; and

                  (c)      such employee has been continuously employed by the
                           Participating Companies for at least 6 consecutive
                           months.

No right to purchase Common Stock hereunder shall accrue under the Plan in favor
of any person who is not an Eligible Employee as of the first day of a Purchase
Period (as defined in Section 3). Notwithstanding anything contained in the Plan
to the contrary, no Eligible Employee shall acquire a right to purchase Common
Stock hereunder if (i) immediately after receiving such right, such employee
would own 5% or more of the total combined voting power or value of all classes
of stock of the Company or any Subsidiary Company (including any stock
attributable to such employee under section 424(d) of the Code), or (ii) for any
calendar year such right would permit such employee's aggregate rights to
purchase stock under all employee stock purchase plans of the Company and its
Subsidiary Companies exercisable during such calendar year to accrue at a rate
which exceeds $25,000 of fair market value of such stock for such calendar year.

                  3. EFFECTIVE DATE OF PLAN; PURCHASE PERIODS. The Plan shall
become effective on September 1, 2001 or on such later date as may be specified
by the Committee (as defined in Section 11). The Plan shall cease to be
effective unless, within 12 months before or after the date of its adoption by
the Board of Directors of the Company (the "Board"), it has been approved by the
shareholders of the Company.

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                  A "Purchase Period" shall consist of the three month period
beginning on the effective date and each three month period beginning three
months, six months, nine months and twelve months after the effective date as
well as the three month periods beginning on the anniversaries of such three
month periods and prior to termination of the Plan.

                  4.  BASIS OF PARTICIPATION.  (a)  PAYROLL DEDUCTION.  Each
Eligible Employee shall be entitled to enroll in the Plan as of the first day of
any Purchase Period which begins on or after such employee has become an
Eligible Employee.

                  To enroll in the Plan, an Eligible Employee shall make a
request to the Company or its designated agent at the time and in the manner
specified by the Committee, specifying the amount of payroll deduction to be
applied to the compensation paid to the employee by the employee's employer
while the employee is a participant in the Plan. The amount of each payroll
deduction specified in such request for each such payroll period shall be a
whole percentage amount, unless otherwise determined by the Committee, of the
participant's compensation (before withholding or other deductions) paid to him
or her during the Purchase Period by any of the Participating Companies,
provided that the deduction for each pay period shall not be less than $20 and
not more than the amount or percentage determined by the Committee. Subject to
compliance with applicable rules prescribed by the Committee, the request shall
become effective on the first day of the Purchase Period following the day the
Company or its designated agent receives such request.

                  Payroll deductions (and any other amount paid under the Plan)
shall be made for each participant in accordance with such participant's request
until such participant's participation in the Plan terminates, such
participant's payroll deductions are suspended, such participant's request is
revised or the Plan terminates, all as hereinafter provided.

                  A participant may change the amount of his or her payroll
deduction effective as of the first day of any Purchase Period by so directing
the Company or its designated agent at the time and in the manner specified by
the Committee. A participant may not change the amount of his or her payroll
deduction effective as of any date other than the first day of a Purchase
Period, except that a participant may elect to suspend his or her payroll
deduction under the Plan as provided in Section 7.

                  Payroll deductions for each participant shall be credited to a
purchase account established on behalf of the participant on the books of the
participant's employer or such employer's designated agent (a "Purchase
Account"). As of the first business day of the month immediately following the
end of each Purchase Period (the "Exercise Date"), the amount in each
participant's Purchase Account will be applied to the purchase of the number of
whole shares of Common Stock determined by dividing such amount by the Purchase
Price (as defined in Section 5) for such Exercise Date. No interest shall accrue
at any time for any amount credited to a Purchase Account of a participant.

                  (b) OTHER METHODS OF PARTICIPATION. The Committee may, in its
discretion, establish additional procedures whereby Eligible Employees may
participate in the Plan by means other than payroll deduction, including, but
not limited to, delivery of funds by participants in a lump sum or automatic
charges to participants' bank accounts. Such other methods of participating
shall be subject to such rules and conditions as the Committee may establish.
The Committee may at any time amend, suspend or terminate any participation

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procedures established pursuant to this paragraph without prior notice to any
participant or Eligible Employee.

                  5. PURCHASE PRICE. The purchase price (the "Purchase Price")
per share of Common Stock hereunder for any Exercise Date (as defined in Section
4) shall be 90% of the fair market value of a share of Common Stock on the
Exercise Date. If such sum results in a fraction of one cent, the Purchase Price
shall be increased to the next higher full cent. For purposes of the Plan,
unless otherwise determined by the Committee, the fair market value of a share
of Common Stock on a given day shall be the closing price of a share of Common
Stock as reported on the New York Stock Exchange on the date as of which such
value is being determined, or, if the New York Stock Exchange is not open for
trading on such date, the fair market value of a share of Common Stock shall be
the closing price of a share of Common Stock on the next preceding date for
which transactions were reported. In no event, however, shall the Purchase Price
be less than the par value of a share of Common Stock.

                  6. ISSUANCE OF STOCK. The Common Stock purchased by each
participant shall be issued in book entry form and shall be considered to be
issued and outstanding to such participant's credit as of the close of business
on the Exercise Date (as defined in Section 4). A participant will be issued a
certificate for his or her shares of Common Stock when the participant's
participation in the Plan has been terminated in accordance with Section 7, the
Plan is terminated or upon request, but, in the last case, only in denominations
of at least [25] shares. After each Exercise Date, information will be made
available to each participant regarding the entries made to such participant's
Purchase Account, the number of shares of Common Stock purchased and the
applicable Purchase Price.

                  The Committee may permit or require that shares be deposited
directly with a broker designated by the Committee or to a designated agent of
the Company, and the Committee may use electronic or automated methods of share
transfer. The Committee may require that shares be retained with such broker or
agent for a designated period of time and/or may establish other procedures to
permit tracking of disqualifying dispositions of such shares.

                  7. TERMINATION OF PARTICIPATION. (a) Suspension of Payroll
Deduction. A participant may elect at any time and in the manner specified by
the Committee to suspend his or her payroll deduction under the Plan, provided
such election is received by the Company or its designated agent prior to the
date specified by the Committee for suspension of payroll deduction with respect
to the Purchase Period for which such termination is to be effective. Upon any
suspension of participation, the participant's payroll deductions shall cease
and, if the participant elects, the cash credited to such participant's Purchase
Account on the date of such suspension shall be delivered as soon as practicable
to such participant. If the participant does not elect to receive such cash,
such cash shall be applied to the purchase of shares of Common Stock, as
described in Sections 4, 5 and 6 hereof. A participant who elects to suspend
participation in the Plan shall be permitted to resume participation in the Plan
by making a new request at the time and in the manner described in Section 4
hereof.

                  (b) Termination of Participation. If the participant dies,
terminates employment with the Participating Companies for any reason, or
otherwise ceases to be an Eligible Employee, such participant's participation in
the Plan shall immediately terminate. Upon such terminating event, the cash
credited to such participant's Purchase Account on the date of such termination
shall be delivered promptly to such participant or his or her legal
representative, as the case may

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be, and certificates for the number of full shares of Common Stock held for his
or her benefit and the cash equivalent for any fractional share so held shall be
delivered to the participant as soon as practicable after such termination. Such
cash equivalent shall be determined by multiplying the fractional share by the
fair market value of a share of Common Stock on the Exercise Date (as defined in
Section 4) immediately preceding such termination, determined as provided in
Section 5.

                  8. TERMINATION OR AMENDMENT OF THE PLAN. The Company, by
action of the Board or the Committee, may terminate the Plan at any time, in
which case notice of such termination shall be given to all participants, but
any failure to give such notice shall not impair the effectiveness of the
termination.

                  Without any action being required, the Plan shall terminate in
any event when the maximum number of shares of Common Stock to be sold under the
Plan (as provided in Section 12) has been purchased. Such termination shall not
impair any rights which under the Plan shall have vested on or prior to the date
of such termination. If at any time the number of shares of Common Stock
remaining available for purchase under the Plan are not sufficient to satisfy
all then-outstanding purchase rights, the Board or Committee may determine an
equitable basis of apportioning available shares of Common Stock among all
participants.

                  The Board or the Committee may amend the Plan from time to
time in any respect for any reason; provided, however, no such amendment shall
(a) materially adversely affect any purchase rights outstanding under the Plan
with respect to the Purchase Period in which such amendment is to be effected,
(b) increase the maximum number of shares of Common Stock which may be purchased
under the Plan, (c) decrease the Purchase Price of a share of Common Stock with
respect to any Purchase Period below 85% of the fair market value thereof on the
Exercise Date or (d) adversely affect the qualification of the Plan under
section 423 of the Code.

                  Upon termination of the Plan, one or more certificates for the
number of full shares of Common Stock held for each participant's benefit and
the cash equivalent of any fractional share so held, determined as provided in
Section 7 shall be delivered to such participant as soon as practicable after
the Plan terminates, and, except as otherwise provided in Section 14, the cash,
if any, credited to the such participant's Purchase Account, shall also be
distributed to such participant as soon as practicable after the Plan
terminates.

                  9.  NON-TRANSFERABILITY.  Rights acquired under the Plan are
not transferable and may be exercised only by a participant.

                  10.  SHAREHOLDER'S RIGHTS.  No Eligible Employee or
participant shall by reason of the Plan have any rights of a shareholder of the
Company until he or she shall acquire a share of Common Stock as herein
provided.

                  11. ADMINISTRATION OF THE PLAN. The Plan shall be administered
by a committee (the "Committee") designated by the Board. In addition to the
power to amend or terminate the Plan pursuant to Section 8, the Committee shall
have full power and authority to: (i) interpret and administer the Plan and any
instrument or agreement entered into under the Plan; (ii) establish such rules
and regulations and appoint such agents as it shall deem appropriate for the
proper administration of the Plan; and (iii) make any other determination and
take any other action that the Committee deems necessary or desirable for
administration of the Plan. Decisions

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of the Committee shall be final, conclusive and binding upon all persons,
including the Company, any participant and any other employee of the Company.

                  The Plan shall be administered so as to ensure that all
participants have the same rights and privileges as are provided by section
423(b)(5) of the Code.

                  12. MAXIMUM NUMBER OF SHARES. The maximum number of shares of
Common Stock which may be purchased under the Plan is 500,000, subject to
adjustment as hereinafter set forth. Shares of Common Stock sold hereunder may
be treasury shares, authorized and unissued shares, shares purchased for
participants in the open market (on an exchange or in negotiated transactions)
or any combination thereof. If the Company shall, at any time after the
effective date of the Plan, change its issued Common Stock into an increased
number of shares, with or without par value, through a stock dividend or a stock
split, or into a decreased number of shares, with or without par value, through
a combination of shares, then, effective with the record date for such change,
the maximum number of shares of Common Stock which thereafter may be purchased
under the Plan shall be the maximum number of shares which, immediately prior to
such record date, remained available for purchase under the Plan proportionately
increased, in case of such stock dividend or stock split, or proportionately
decreased in case of such combination of shares.

                  13. MISCELLANEOUS. Except as otherwise expressly provided
herein, (i) any request, election or notice under the Plan from an Eligible
Employee or participant shall be transmitted or delivered to the Company or its
designated agent and, subject to any limitations specified in the Plan, shall be
effective when so delivered and (ii) any request, notice or other communication
from the Company or its designated agent that is transmitted or delivered to
Eligible Employees or participants shall be effective when so transmitted or
delivered. The Plan, and the Company's obligation to sell and deliver shares of
Common Stock hereunder, shall be subject to all applicable federal and state
laws, rules and regulations, and to such approval by any regulatory or
governmental agency as may, in the opinion of counsel for the Company, be
required.

                  14. CHANGE IN CONTROL. In the event of any Change in Control
of the Company, as defined below, the then current Purchase Period shall
thereupon end, the Committee, in its sole discretion, shall either direct that
the cash credited to all participants' Purchase Accounts be applied to purchase
shares pursuant to Sections 4, 5 and 6 or that such cash be returned to
participants and the Plan shall immediately thereafter terminate. For purposes
of this Section 14, "Change in Control" shall have the same meaning as the
definition of "Change in Control" set forth in the Whitehall Jewellers, Inc.
1997 Long-Term Incentive Plan, or any successor plan thereto.

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                                                                     EXHIBIT 4.4

         This document is a translation from French to English of the "Reglement
         du Plan d'Epargne d'Entreprise Nortel Networks". This translation is
         made for information purposes only. In case of dispute, only the French
         Reglement will prevail.

            REGULATIONS FOR THE NORTEL NETWORKS COMPANY SAVINGS PLAN

This Company Savings Plan, hereinafter referred to as the PEE, has been created
on the initiative of the French companies, direct and indirect French
subsidiaries of NORTEL NETWORKS LIMITED UNDER THE TERMS OF ARTICLE 354 OF THE
FRENCH LAW OF 24 JULY 1966, i.e.:

NORTEL NETWORKS FRANCE SA, a French company with a capital of FRF 294,000,
identification number 381 876 879 RCS EVRY, head office at ZA de Courtaboeuf,
91940 Les ULIS, represented by Mr. Michel GASNIER, Chairman of the Board, acting
ex officio,

NORTEL NETWORKS EUROPE SA a French company with a capital of FRF 146,496,310,
identification number 304 864 168 RCS MEAUX, head office at 15, av. Alexander
Graham Bell Bussy-St-Georges, 77608 MARNE-LA-VALLEE Cedex 3, represented by Mr
Cesar CESARATTO, Chairman of the Board, acting ex officio,

NORTEL NETWORKS EMEA SA, a French company with a capital of FRF 725,000
identification number 384 457 743 RCS GRASSE, head office at 25, allee Pierre
Ziller, 06560 VALBONNE, represented by Mr Michel GASNIER, Chairman of the Board,
acting ex officio,

NORTEL MATRA CELLULAR SCA, a French company with a capital of FRF 218,063,500,
identification number 389 516 741 RCS VERSAILLES, head office at 1 place des
Freres Montgolfier, Guyancourt (78), represented by Mr Pascal DEBON, General
Manager, acting ex officio,

MATRA NORTEL COMMUNICATIONS SAS, a French company with a capital of FRF
361,832,400, identification number 552 150 724 RCS QUIMPER, head office at 50,
rue du President Sadate Creac'h Gwenn, 29101 QUIMPER, represented by Mr Michel
CLEMENT, Chairman of the Board acting ex officio,

MATRA NORTEL COMMUNICATIONS DISTRIBUTION SA, with a capital of FRF 120,617,200
identification number 319 060 075 RCS QUIMPER, head office at a 50, rue du
President Sadate, 29562 QUIMPER, represented by Mr Jean-Claude AYMARD, Chairman
of the Board acting ex officio,

MATRA NORTEL COMMUNICATIONS CENTRE EST SA, with a capital of FRF 15,037,600,
identification number 329 223 770 RCS LYON, head office at 320, avenue Charles
de Gaulle 69500 BRON, represented by Mr Jean-Claude AYMARD, Chairman of the
Board acting ex officio,

MATRA NORTEL COMMUNICATIONS PARIS ILE DE FRANCE SA, with a capital of FRF
25,476,900, identification number 329 477 301 RCS NANTERRE, head office at 53,
Boulevard Stalingrad, 92247 MALAKOFF, represented by Mr Michel Clement, Chairman
of the Board acting ex officio,

MATRA NORTEL COMMUNICATIONS SUD SA, with a capital of FRF 20,055,500,
identification number 323 276 162 RCS TOULOUSE, head office at 23, avenue
Champollion, 31000 TOULOUSE, represented by Mr Jean-Claude AYMARD, Chairman of
the Board acting ex officio.

MATRA NORTEL COMMUNICATIONS NORD OUEST SA, with a capital of FRF 26,215,000,
identification number 328 858 568 RCS LILLE, head office at Rue Delesalle - ZA
du Pre Catelan, 59110 LA MADELEINE, represented by Mr Michel CLEMENT, Chairman
of the Board acting ex officio.

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CLARIFY SARL, a French company with a capital of FRF 50,000, identification
number 409 245 776 RCS NANTERRE, head office at 12 Avenue de l'Arche - Faubourg
de l'Arche, 92419 COURBEVOIE Cedex, represented by Mr David QUANTRELL, General
Manager, acting ex officio.

Hereinafter referred to as "member companies".

It is established in accordance with chapter IV of section IV of the Labour Code
(Code du Travail) on company savings plans.

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ARTICLE 1: AIM

This Company Savings Plan (PEE), created on July 2000, is intended to allow
employees of the members companies, with the help of their employers, i.e.
member companies, to build up a portfolio of securities via Collective
Investment Funds.

ARTICLE 2: BENEFICIARIES

Any employee of a member company which adopts the plan with six months seniority
in one of the member companies may participate in the Company Savings Plan. A
change of employer within the member companies does not alter the seniority
already acquired.

Pensioners and employees who have taken an early retirement can continue to make
voluntary payments into the Company Savings Plan as long as they had
participated in the plan during their employment and have not asked for the
total liquidation of their assets.

ARTICLE 3: CONTRIBUTIONS TO THE PEE

Contributions to the PEE are made via the following methods:

     a)   employee voluntary contributions,
     b)   additional contributions (employer's matching contributions) from
          member companies.

ARTICLE 4: EMPLOYEE VOLUNTARY CONTRIBUTIONS

Any employee may make contributions to the PEE as of July 2000.

Employees make their contributions on a monthly basis, contributing a maximum of
10% of the eligible gross earnings and a minimum of 1% of the eligible gross
earnings. This rule, however, shall not constrain an employee to contribute
greater than FRF 1000 in a calendar year.

These contributions are recorded as a whole percentage of employee gross
eligible earnings, on a scale of 1% to 10%.

Contributions to the PEE are withheld from the employee's salary from the member
company at the end of each month.

Pensioners and employees who have taken an early retirement can continue to make
voluntary payments at any time into the Company Savings Plan of up to 10% of
their eligible gross earnings during the last calendar year of employment.

Gross eligible earnings is understood as the employee's basic gross salary as
determined by the employer in accordance with its regular practice, including
any payment made during a period of temporary incapacity or any other period of
paid leave granted under a programm sponsored by the employer, bonuses paid in
the "Success Plan" and/or the "Executive Management Incentive Program",
commissions on sales made, overtime, night-shift bonuses and any other earnings
deemed eligible by the Company.

The law does not allow an employee to pay more than a quarter of his/her annual
gross earnings into the various Company Savings Plans to which he/she
contributes.

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ARTICLE 5: EMPLOYER CONTRIBUTIONS

Contributions made by member companies complement the voluntary contributions
made by employees by providing an employer's matching contribution of 25% of the
employee's contribution, up to a maximum of FRF 15,000 annually per employee for
all his/her Company Savings Plans.

Current legislation does not allow an employee to receive an employer's matching
contribution of more than FRF 15,000 annually. Given these limitations, all
those who benefit from employer's matching contributions paid by any company
other than the one he/she is employed by, must give an annual declaration of the
amount of contributions received to the employer. The signatory must accept
responsibility for any false declaration.

The employer's matching contribution paid by the member companies is subject to
CSG and CRDS welfare surtaxes and is exempt from social security and income tax.

The employer's matching contribution will be detailed in a document sent to
employees, on which the gross aggregate of employer's matching contribution, the
totals of CSG and CRDS deducted and the aggregate of net employer's matching
contribution which are invested in the PEE are described.

In accordance with legislation, pensioners and employees who have taken an early
retirement can no longer benefit from the employer's matching contribution on
contributions which they continue to make after their departure.

ARTICLE 6: ENROLMENT CONDITIONS

Each PEE financial year, which lasts for 12 months, begins on 1 January and ends
on the 31 December of the same year. For the year 2000, the PEE financial year
will begin on 10 July and end on 31 December.

To enrol in the PEE, the employee must fill in an enrolment form which is
provided in advance. The Human Resources Department must be informed of any
enrolment in the PEE at least 10 days before the beginning of the month when
enrolment is to take effect. Exceptionally, when it is the opening year of the
PEE, enrolments must be made before 30 June at the latest.

Each employee may at any time decide to modify his contributions to the PEE. In
order to do so, he/she must inform the Human Resources Department of his/her
decision at least 10 days before the START of the month for which he/she wishes
the decision to take effect.

He/she may also suspend his membership, and must inform the Human Resources
Department in writing. Contributions are stopped as soon as possible following
receipt of this notification.

The number of modifications is limited to a total of four times per year per
employee.

ARTICLE 7: CUSTODIAN OF THE COLLECTIVE FUND AND THE ACCOUNT HOLDER

The CUSTODIAN of the Collective Funds is SOCIETE GENERALE, a French company with
a capital of EUR 521,653,105, identification number 552 120 222 R.C.S. Paris,
with its head office at 29, boulevard Haussmann, 75009 PARIS.

Sums paid into the PEE (employee and company contributions) are collected by the
CUSTODIAN who, within the space of 2 weeks, invests them in units of the
Collective Investment Funds.

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Rights and obligations of employees who individually own units of the Collective
Investment Funds, of the CUSTODIAN and the management company are set by the
Collective Funds Regulations (Reglement des Fonds Communs de Placement).

The ACCOUNT HOLDER is the SOCIETE GENERALE, a French company with a capital of
EUR 521,653,105, identification number 552 120 222 R.C.S. Paris, with its head
office at 29, boulevard Haussmann, 75009 PARIS.

ARTICLE 8: MANAGEMENT COMPANY

The funds are managed by SOCIETE GENERALE ASSET MANAGEMENT, a French company
with a capital of EUR 244,000,000, identification number 308 396 308 RCS
Nanterre, with its head office at 2, place de la Coupole - 92400 COURBEVOIE,
hereinafter referred to as SGAM.

ARTICLE 9: - INVESTING CONTRIBUTIONS

Amounts paid to the CUSTODIAN, in favour of the PEE are allocated immediately
and completely to subscription of units of the NORTEL NETWORKS Collective
Investment Fund.

Employees and former employees who hold units in the NORTEL NETWORKS Collective
Investment Fund may request a transfer of all or part of their available or
unavailable assets to the ARCANCIA SECURITE 207 Collective Investment Fund.

Conversely, employees and former employees who hold units in the ARCANCIA
SECURITE 207 Collective Investment Fund may request a transfer of all or part of
their available or unavailable assets to the NORTEL NETWORKS Collective
Investment Fund.

Transfer transactions may be made at any time, up to a total of four times per
year per employee. They have no impact on the duration of the retention period.

IN THE EVENT OF A DELAY IN THE CERTIFICATION OF THE REGULATIONS OF THE NORTEL
NETWORKS COLLECTIVE INVESTMENT FUND BY THE STOCKMARKET OPERATIONS COMMITTEE
(COMMISSION DES OPERATIONS DE BOURSE, COB), AMOUNTS PAID TO THE CUSTODIAN WILL
BE ALLOCATED TEMPORARILY TO THE ARCANCIA 207 COLLECTIVE INVESTMENT FUND. AS SOON
AS CERTIFICATION OF NORTEL NETWORKS COLLECTIVE INVESTMENT FUND IS RECEIVED FROM
THE COB, THEY WILL BE TRANSFERRED COLLECTIVELY TO THE NORTEL NETWORKS COLLECTIVE
INVESTMENT FUND WITHOUT ANY SUBSCRIPTION COMMISSION OR FEES BEING CHARGED.

ARTICLE 10: COMPOSITION OF THE COLLECTIVE INVESTMENT FUNDS ASSETS

The portfolios of the Collective Investment Funds consist of securities which
fulfil the criteria required by current legislation.

-        The portfolio of the NORTEL NETWORKS Collective Investment Fund
         consists mainly of ordinary shares listed on the New York Stock
         Exchange of NORTEL NETWORKS CORPORATION, a company under Canadian law,
         and for the rest, it consists of cash and hedging instruments.

-        The ARCANCIA SECURITE 207 Collective Investment Fund is classified in
         the category "short-term Collective Investment Fund". It is permanently
         invested at 100% of its net assets in a general-purpose mutual fund
         (OPCVM) which is either French Franc money market or international
         currency money market denominated. The securities and instruments in
         which it can invest are units or shares of Collective Funds
         organisations mainly invested in securities in Euro zone countries.

Securities which appear in the assets section of the Collective Investment Funds
are:

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-        securities negotiated on a regulated market operating regularly in a
         member State of the European Union,
-        and/or securities negotiated on a market in regular operation of a
         non-member State of the European Union, inasmuch as this market has not
         been excluded by the COB:
-        and if necessary in mutual funds (OPCVM).

ARTICLE 11: UNAVAILABILITY OF FUNDS

Units which are allocated to the account of an employee will only be available
from the date of expiry of a deadline of five years from the last day of the
sixth month of the year during which payments were made.

The units available may be cashed in at any time on request of the employee as
stipulated in article 12 below.

The locked units which are allocated into the employee's account will become
available by early release, on request of the employee, any legal claimant or
any authorised person, falling into any one of the following categories:

     a)   Marriage of the beneficiary;
     b)   Birth, or adoption of a third child and following children;
     c)   Divorce, when the beneficiary is given custody of at least one child;
     d)   Disability of the beneficiary or spouse as in paragraphs 2 and 3 of
          article L 341-4 of the Social Security Code;
     e)   Death of the beneficiary or spouse;
     f)   Termination of employment;
     g)   Creation or purchase by the beneficiary or spouse of an industrial,
          commercial, craft industry or agricultural company, either
          individually or in the form of a company with the aim of exercising
          control as in article 163 quinquies A of the CGI, or of another
          self-employed profession;
     h)   Acquisition or extension of the main home leading to the creation of a
          new inhabitable surface as defined in article R111.2 of the
          Construction and Habitation Code, on condition of the existence of a
          building permit, or prior declaration of work.
     i)   Excess debt accumulated by the employee as defined in article L 331-2
          of the Consumption Code on request made to the Fund Manager or to the
          employer by the Chairmen of the committee responsible for examining
          the debtor or the judge when he/she considers the releasing the funds
          will improve the outcome in terms of the implementation of an amicable
          payment solution or civil judiciary settlement.

ARTICLE 12: SALES REQUESTS

The sale of units which have become available at the end of the legal retention
period of 5 years or following a case of early release in accordance with the
regulations of article 11 above, are carried out in accordance with the articles
of the Regulations of the Collective Investment Funds as designated above.

Written sales requests should be made by beneficiaries and must be addressed
directly to the ACCOUNT HOLDER at least two working days before the date when
the value of the units is determined.

The calculation methods of the value of the Collective Investment Funds units
are stipulated in the Regulations of the Collective Fund.

<PAGE>   7

ARTICLE 13: ACCOUNT AND MANAGEMENT FEES

Management fees of the Collective Investment Funds are deducted from their
assets.

Front-end load fees are paid by the employees; they are deducted from the
contributions. The front-end loads are not taken on an individual arbitrage
transaction (transfer from one Collective Investment Fund to another), or for
collective transfer transactions from one Collective Investment Fund to another.

Fees pertaining to management of individual employee accounts are met by each
member company.

Management fees for individual accounts cease to be paid by member companies one
year after the release of the units acquired by the latest retention period by
employees who have left the member company, including pensioners and employees
who have taken an early retirement. These fees are met by the unit holders of
the Collective Investment Funds in question.

ARTICLE 14: INCOME

Income and revenue from assets in Collective Investment Funds are automatically
reinvested by SGAM. They increase the net asset value of the units of the
Collective Investment Funds by the same amount

ARTICLE 15: INFORMATION TO MEMBER COMPANIES AND EMPLOYEES

Each year, SGAM provides each member company and the Supervisory Board with the
following:

-    a report on Collective Investment Funds transactions,
-    a complete inventory of all assets,
-    indication of the number of units and thousandths of units as at 31
     December, in addition to the sale price of the units on the same date.

The ACCOUNT HOLDER sends a quarterly statement of subscription transactions to
each employee holding units in the Collective Investment Funds, in addition to a
statement of any reimbursement or transfer transaction. If no transactions are
made throughout the year, a statement will be sent at the beginning of the
following calendar year, at the latest on 31 January.

When he/she first enrols, each new holder will receive an information sheet on
the Nortel Networks Collective Investment Funds.

ARTICLE 16: DURATION OF PEE - TERMINATION- MODIFICATION

The PEE is valid for an unspecified period of time. It may be terminated or
modified at any time by joint agreement by all member companies. Each member
company will immediately inform all personnel of any termination or modification
of the PEE.

Any new company which becomes a direct or indirect subsidiary under the terms of
article 354 of the French law of 24 July 1966 of NORTEL NETWORKS LIMITED will be
automatically eligible for the PEE, and may become a member of it.

Any member company which ceases to be a direct or indirect subsidiary under the
terms of article 354 of French law of 24 July 1966 of NORTEL NETWORKS LIMITED
will automatically be excluded from the plan.

These modifications will be subject to amendments made to the PEE regulations.

<PAGE>   8

Any member company can terminate its participation in the PEE at any time and
must notify all personnel of this decision. This decision will be subject to
amendments made to PEE regulations.

The termination of the PEE by a member company or the cessation to be a direct
or indirect subsidiary of NORTEL NETWORKS LIMITED ends contributions made by
employees, additional contributions by the member company (employer's matching
contribution) and contributions by former retired employees or those who have
taken early retirement. Unavailable assets in the PEE will be retained until
their legal expiry; available assets may be held freely in the PEE.

ARTICLE 17: EMPLOYEES WHO LEAVE  THEIR COMPANY

Employees who remain in possession of units after leaving their company continue
to receive statements as stipulated in article 15 above. Unit sales instructions
should be addressed to the ACCOUNT HOLDER; if necessary, they should be
accompanied by the necessary documents to support the situations stated in
article 11 above and allowing for early release. The payments corresponding to
the sale request should be fulfilled by the ACCOUNT HOLDER.

                       Made in Guyancourt, on May 19, 2000

NORTEL NETWORKS FRANCE*
represented by Mr Michel GASNIER, Chairman of the Board

NORTEL NETWORKS EUROPE
represented by Mr Cesar CESARATTO , Chairman of the Board

NORTEL NETWORKS EMEA
represented by Mr Michel GASNIER, Chairman of the Board

NORTEL MATRA CELLULAR
represented by Mr Pascal DEBON, General Manager

MATRA NORTEL COMMUNICATIONS DISTRIBUTION
represented by Mr Jean-Claude AYMARD, Chairman of the Board

MATRA NORTEL COMMUNICATIONS SAS
represented by Mr Michel CLEMENT, Chairman of the Board

MATRA NORTEL COMMUNICATIONS CENTRE-EST
represented by Mr Jean-Claude AYMARD, Chairman of the Board

----------
*    To be confirmed "read and approved" and signed

<PAGE>   9

MATRA NORTEL COMMUNICATIONS PARIS ILE DE FRANCE
represented by Mr Michel CLEMENT, Chairman of the Board

MATRA NORTEL COMMUNICATIONS SUD
represented by Mr Jean-Claude AYMARD, Chairman of the Board

MATRA NORTEL COMMUNICATIONS NORD OUEST
represented by Mr Michel CLEMENT, Chairman of the Board

CLARIFY
represented by Mr David QUANTRELL, General Manager

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