Lucent Technologies' creditors OK'd its restructuring terms, allowing it to reorganize, including taking a fourth-quarter $7 billion to $9 billion restructuring charge.

Much had hinged on the approval. According to the terms of a $4 billion loan agreement earlier this year, Lucent would keep its net worth above $23 billion and could not take more than $4 billion in restructuring charges.

Part of Lucent's reorganization plan announced last month included taking the higher restructuring charges. Likewise, S&P had lowered the company's ratings and put it on S&P's CreditWatch list, but noted that Lucent's status would rise to stable if the covenants were amended, and Lucent was allowed to take its charges in its fourth quarter.

Under the new agreement, the company can take up to $9.7 billion in charges, including a $3 billion cash charge. Creditors also will require a lower net worth — around $20 billion for the next quarter and $17 billion for the next.

In turn, however, Lucent, still angling to spin off Agere, must achieve a positive EBITDA for the quarter prior to spinning the unit off, and it must increase the cash needed for the spin, from $2.5 billion to $5 billion, it says. Lucent says in a statement it is on track to meet the cash condition through its recent financing actions and others it intends to complete.

Lucent recently raised at least $1.75 billion in a convertible stock offering, and sold its optical fiber unit for $2.75 billion.

Finally, Lucent says it can't resume payment on its recently discontinued dividends unless it reaches certain credit ratings or EBITDA levels.