O R D E R

IT IS ORDERED that:

1. The joint application of SBC Communications, Inc. (SBC) and AT&T Corp. (AT&T) for authorization to transfer control of AT&T Communications of California, TCG Los Angeles, Inc., TCG San Diego, and TCG San Francisco to SBC, which will occur indirectly as a result of AT&T's merger with a wholly-owned subsidiary of SBC, is granted subject to four conditions. Any proposed condition not explicitly ordered is denied. The four conditions mandated are:

a) SBC shall, by June 30, 2006, cease forcing customers to purchase separately traditional local phone service as a condition for obtaining DSL (this condition is commonly known as a requirement to provide "naked DSL." We further order that no later than June 30, 2006 , SBC shall submit an affidavit evidencing compliance with this condition of the merger.

b) Applicants shall adopt the agreement that Applicants negotiated with The Greenlining Institute (Greenlining) and Latino Issues Forum (LIF) ²¹⁴ and as modified in this decision (Greenlining Agreement). Under the key terms of the Greenlining Agreement the Applicants agree to:

· Participate in a statewide Broadband Task Force

· Increase corporate philanthropy over the next 5 years. Philanthropy will increase to $15 million for years one and two. Philanthropy will increase yet again to $20 million for years three, four, and five. The total net increase in philanthropy from current levels is $47 million. SBC commits to direct at least 60% of this additional philanthropy to minorities and underserved communities.

· Make a good faith effort to increase the supplier diversity goal for minority business enterprises from the current 23% to 27% by 2010. To achieve this goal, minority, supplier, diversity spending in California could grow to $40 million in 2006 and to $80 million by 2010.

c) Applicants shall commit $9 million per year for 5 years in charitable contributions ($45 million total), to a non-profit corporation, the California Emerging Technology Fund (CETF), to be established by the Commission for the purpose of achieving ubiquitous access to broadband and advanced services in California, particularly in underserved communities, through the use of emerging technologies by 2010. No more than half of Applicant's total commitment to the CETF may be counted toward satisfaction of the Applicants' commitment in the Greenlining Agreement to increase charitable contributions by $57 million over 5 years.

d) Applicants shall freeze for one year rates paid by current AT&T customers receiving DS1 or DS3 private network service. This rate freeze shall begin with the date that control is transferred.

2. Applicants shall file and serve a written notice in this proceeding of the transfer of control and merger of their companies. The authority to transfer control and merge granted herein shall expire 365 days from the effective date of this order.

3. Within 30 days of the issuing date of any decision by another jurisdiction which materially changes the terms of the proposed transaction as it affects any of Applicants' California utility operations, Applicants shall file a copy of that decision with the Commission, with a copy served on the service list in this proceeding and the Director of the Telecommunications Division. The filing shall also include an analysis of the impact of any terms and conditions contained therein as they affect any of Applicants' California utility operations.

4. Applicants shall notify the Commission, with a copy served on the service list in this proceeding and the Director of the Telecommunications Division, of the date the merger is consummated. The notice shall be served within 30 days of merger consummation.

5. In the event that the books and records of Applicants or any affiliates thereof are required for inspection by the Commission or its staff, Applicants shall either produce such records at the Commission's offices, or reimburse the Commission for the reasonable costs incurred in having Commission staff travel to any of Applicants' offices.

6. If Applicants consummate the proposed merger authorized herein, their failure to comply with any element of this order shall constitute a violation of a Commission order, and subject applicants to penalties and sanctions consistent with law.

7. The Applicants are authorized to comply with the mandates of the Department of Justice and the Federal Communications Commission without having to file a formal application. Applicants are granted this authority per
§ 853 (b) which allows the Commission to exempt this transaction. Applicants shall provide notice of any transfers of public utility property to the Director of the Telecommunications Division.

8. The Commission shall appoint four members to the CETF, SBC shall appoint three members to the CETF (with no more than one of those appointments being an SBC employee), and Verizon shall appoint one member to the CETF (pending resolution of Verizon/MCI proceeding). The original eight members of the CETF shall be organized as a body no later than 90 days after the effective date of this order. These eight members will select the remaining four members to complete the CETF governing board. The Director of the

Telecommunications Division will help coordinate with the logistics of organizing this board but will have no responsibilities after the initial meeting occurs.

This order is effective today.

Dated November 18, 2005, at San Francisco, California.

MICHAEL R. PEEVEY

President

SUSAN P. KENNEDY

DIAN M. GRUENEICH

JOHN A. BOHN

Commissioners

I reserve the right to file a dissent.

GEOFFREY F. BROWN

Commissioner

I reserve the right to file a concurrence.

SUSAN P. KENNEDY

Commissioner

I reserve the right to file a concurrence.

DIAN M. GRUENEICH

Commissioner

I reserve the right to file a concurrence.

JOHN A. BOHN

Commissioner

APPENDIX A - LIST OF APPEARANCES

David J. Miller Attorney At Law AT&T 795 FOLSOM STREET, ROOM 3107 SAN FRANCISCO CA 94107 (415) 442-5509 davidjmiller@att.com For: AT&T John Grubb BAY AREA COUNCIL 200 PINE STREET, SUITE 300 SAN FRANCISCO CA 94104 (415) 981-6600 jgrubb@bayareacouncil.org For: Bay Area Council Stephen P. Bowen Attorney At Law BOWEN LAW GROUP, L.L.P. 235 MONTGOMERY STREET, SUITE 920 SAN FRANCISCO CA 94104 (415) 394-7500 steve.bowen@bowenlawgroup.com Lindsay Bower CA DEPARTMENT OF JUSTICE 455 GOLDEN GATE AVE., STE 11000 SAN FRANCISCO CA 94102 (415) 703-5517 lindsay.bower@doj.ca.gov For: Attorney General of California Sarah De Young CALIFORNIA ASSOCIATION OF COMPETITIVE 50 CALIFORNIA STREET, SUITE 1500 SAN FRANCISCO CA 94111 (925) 465-4396 deyoung@caltel.org For: California Association of Competitive Telephone Companies Laura L. Efurd COMMUNITY TECHNOLOGY FOUNDATION OF CA 101 SPEAR ST., SUITE 218 SAN FRANCISCO CA 94105 (415) 371-8808 X 310 laura@zerodivide.org For: Community Technology Foundation of California	Esther Northrup COX CALIFORNIA TELCOM 5159 FEDERAL BLVD. SAN DIEGO CA 92105 (619) 266-5315 esther.northrup@cox.com For: COX CALIFORNIA TELCOM Douglas Garrett COX COMMUNICATIONS 2200 POWELL STREET, STE. 1035 EMERYVILLE CA 94608 (510) 923-6222 douglas.garrett@cox.com Melissa W. Kasnitz Attorney At Law DISABILITY RIGHTS ADVOCATES 449 15TH STREET, SUITE 303 OAKLAND CA 94612 (510) 451-8644 pucservice@dralegal.org For: Consumers with disabilities Geoffrey B. Dryvynsyde Legal Division RM. 4107 505 VAN NESS AVE San Francisco CA 94102 (415) 703-3832 gbd@cpuc.ca.gov Hillary A. Thompson ECONOMICS AND TECHNOLOGY, INC. 2 CENTER PLAZA, SUITE 400 BOSTON MA 02108 Lee L. Selwyn ECONOMICS AND TECHNOLOGY, INC. 2 CENTER PLAZA, SUITE 400 BOSTON MA 02108 Ginny Zeller ESCHELON TELECOM, INC. 730 SECOND AVE. S., SUITE 900 MINNEAPOLIS MN 55402 (612) 436-1888 gazeller@eschelon.com For: Eschelon Telecom, Inc/Advanced Telcom,Inc.
Janine L. Scancarelli FOLGER LEVIN & KAHN LLP 275 BATTERY STREET, 23RD FLOOR SAN FRANCISCO CA 94111 (415) 986-2800 jscancarelli@flk.com For: Community Technology Foundation of California Jiyun Cameron Lee FOLGER LEVIN & KAHN LLP 275 BATTERY STREET, 23RD FLOOR SAN FRANCISCO CA 94111 (415) 986-2800 jlee@flk.com For: Community Technology Foundation of California John Clark Attorney At Law GOODIN MACBRIDE SQUERI RITCHIE & DAY LLP 505 SANSOME STREET, 9TH FLOOR SAN FRANCISCO CA 94111 (415) 765-8443 jclark@gmssr.com For: Telscape Communications, Inc. Thomas J. Macbride, Jr. Attorney At Law GOODIN MACBRIDE SQUERI RITCHIE & DAY LLP 505 SANSOME STREET, SUITE 900 SAN FRANCISCO CA 94111 (415) 765-8444 tmacbride@gmssr.com For: Qwest Communications Corporation Joseph F. Wiedman Attorney At Law GOODIN MACBRIDE SQUERI RITCHIE & DAY,LLP 505 SANSOME STREET, SUITE 900 SAN FRANCISCO CA 94111 (415) 392-7900 jwiedman@gmssr.com For: Qwest Communications Corporation Douglas R. M. Nazarian HOGAN & HARTSON L.L.P. 555 13TH STREET, N.W. WASHINGTON DC 20004 (202) 637-5600 drmnazarian@hhlaw.com For: Qwest Communications Corporation	Tarah S. Grant HOGAN & HARTSON LLP 8300 GREENSBORO DRIVE, STE 1100 MCLEAN VA 22102 (703) 610-6155 tsgrant@hhlaw.com For: Hogan & Hartson LLP Enrique Gallardo SUSAN E. BROWN Attorney At Law LATINO ISSUES FORUM 160 PINE STREET, SUITE 700 SAN FRANCISCO CA 94111 (415) 284-7220 enriqueg@lif.org For: Latino Issues Forum Susan E. Brown ENRIQUE GALLARDO LATINO ISSUES FORUM 160 PINE STREET, SUITE 700 SAN FRANCISCO CA 94111 (415) 284-7220 lifcentral@lif.org For: LATINO ISSUES FORUM Joseph S. Faber Attorney At Law LAW OFFICE OF JOSEPH S. FABER 3527 MT. DIABLO BLVD., SUITE 287 LAFAYETTE CA 94549 (925) 385-0043 jsf@joefaber.com For: Caltel Greg Rogers Director State Regulatory Affairs LEVEL 3 COMMUNICATIONS, LLC 1025 ELDORADO BLVD. BROOMFIELD CO 80021 (720) 888-2512 greg.rogers@level3.com Richard H. Levin Attorney At Law 3554 ROUND BARN BOULEVARD, SUITE 303 SANTA ROSA CA 95403 (707) 523-4223 rl@comrl.com For: Level 3 Communications, LLC; Eschelon Telecom, Inc.; Advanced Telcom, Inc.
Nancy D. Sidhu LOS ANGELES ECONOMIC DEVELOPMENT CORP. 444 SO. FLOWER STREET, 34TH FLOOR LOS ANGELES CA 90071 (213) 622-4300 nsidhu@laedc.org For: LAEDC Theodore A. Livingston CHRISTIAN F. BINNING, HANS J. GERMANN Attorney At Law MAYER, BROWN, ROWE & MAW LLP 190 S. LASALLE STREET CHICAGO IL 60603 (312) 782-0600 tlivingston@mayerbrownrowe.com For: SBC Communications William C. Harrelson Attorney At Law MCI, INC. 201 SPEAR STREET, 9TH FLOOR SAN FRANCISCO CA 94105 (415) 228-1090 william.harrelson@mci.com For: MCI, INC. James M. Tobin MORRISON AND FOERSTER LLP 425 MARKET STREET SAN FRANCISCO CA 94105 (415) 268-7000 jtobin@mofo.com For: Pac-West Telecomm Henry Weissmann Attorney At Law MUNGER, TOLLES & OLSON, LLP 355 S. GRAND AVENUE, SUITE 3500 LOS ANGELES CA 90071-1560 (213) 683-9150 henry.weissmann@mto.com Olivia B. Wein Attorney At Law NATIONAL CONSUMER LAW CENTER 1001 CONNECTICUT AVE., NW., STE. 510 WASHINGTON DC 20036 (202) 452-6252 owein@nclcdc.org For: National Consumer Law Center	Martin A. Mattes Attorney At Law NOSSAMAN, GUTHNER, KNOX & ELLIOTT, LLP 50 CALIFORNIA STREET, 34TH FLOOR SAN FRANCISCO CA 94111 (415) 398-3600 mmattes@nossaman.com For: California Payphone Association Thomas J. Long Attorney At Law OFFICE OF THE CITY ATTORNEY CITY HALL, ROOM 234 SAN FRANCISCO CA 94102 (415) 554-6548 thomas.long@sfgov.org For: The City and County of San Francisco William J. Dorgan Attorney At Law PILLSBURY WINTHROP LLP 50 FREMONT STREET SAN FRANCISCO CA 94105 (415) 983-1238 william.dorgan@pillsburylaw.com For: SBC Communications, Inc. Patrick S. Thompson Attorney At Law PILLSBURY WINTHROP SHAW PITTMAN LLP 50 FREMONT STREET SAN FRANCISCO CA 94105 (415) 983-1511 patrick.thompson@pillsburylaw.com For: SBC Communications, Inc. Lisa Anderl QWEST COMMUNICATIONS 1801 CALIFORNIA STREET, 10TH FLOOR DENVER CO 80202 (303) 383-6614 lisa.anderl@qwest.com For: Qwest Communications Corporation Lynn Stang QWEST COMMUNICATIONS 1801 CALIFORNIA STREET, 10TH FLOOR DENVER CO 80202 (303) 383-6614 lynn.stang@qwest.com For: Qwest Communications Corporation
Adam L. Sherr Corporate Counsel QWEST COMMUNICATIONS CORPORATION 16007 7TH AVENUE, ROOM 3206 SEATTLE WA 98191 (206) 398-2507 adam.sherr@qwest.com For: Qwest Communications Corporation Kristin L. Smith QWEST COMMUNICATIONS CORPORATION 1801 CALIFORNIA STREET, 10TH FLOOR DENVER CO 80202 (303) 383-6614 Kristin.Smith@qwest.com For: Qwest James B. Young Attorney At Law SBC CALIFORNIA 140 NEW MONTGOMERY STREET SAN FRANCISCO CA 94105 (415) 545-9450 jy2378@sbc.com For: SBC Communications, Inc. William R. Drexel JAMES B. YOUNG SBC WEST 140 NEW MONTGOMERY STREET SAN FRANCISCO CA 94105-3705 (415) 545-9450 For: SBC Communications Randolph W. Deutsch Attorney At Law SIDLEY, AUSTIN, BROWN & WOOD, LLP 555 CALIFORNIA STREET SAN FRANCISCO CA 94104 (415) 772-1280 rdeutsch@sidley.com For: AT&T Andrew Ulmer Attorney At Law SIMPSON PARTNERS, LLP 900 FRONT STREET, SUITE 300 SAN FRANCISCO CA 94111 (415) 773-1790 andrew@simpsonpartners.com For: California ISP Association, Inc.	Glenn Stover Attorney At Law STOVER LAW 301 HOWARD STREET, SUITE 830 SAN FRANCISCO CA 94105-6605 (415) 495-7000 glenn@stoverlaw.net For: Navigator Telecom Anita C. Taff-Rice Attorney At Law 1547 PALOS VERDES MALL, SUITE 298 WALNUT CREEK CA 94597 (415) 394-7500 anitataffrice@earthlink.net For: MCI, INC. James Lau THE CHILDREN'S PARTNERSHIP 1351 THIRD ST. PROMENADE, STE 206 SANTA MONICA CA 90401 (310) 260-1220 jlau@childrenspartnership.org For: California Community Technology Policy Group Chris Vaeth Director, Special Projects THE GREENLINING INSTITUTE 1918 UNIVERSITY AVENUE, SECOND FLOOR BERKELEY CA 94704 (510) 926-4012 chrisv@greenlining.org For: Greenlining Institute Chris Vaeth THE GREENLINING INSTITUTE 1918 UNIVERSITY AVE, 2/F BERKELEY CA 94704 (510) 926-4012 chrisv@greenlining.org For: THE GREENLINING INSTITUTE William Nusbaum Attorney At Law THE UTILITY REFORM NETWORK 711 VAN NESS AVE., SUITE 350 SAN FRANCISCO CA 94102 (415) 929-8876 X 309 bnusbaum@turn.org For: TURN
Margaret L. Tobias Attorney At Law TOBIAS LAW OFFICE 460 PENNSYLVANIA AVENUE SAN FRANCISCO CA 94107 (415) 641-7833 marg@tobiaslo.com For: Cox Communications Elaine M. Duncan Attorney At Law VERIZON CALIFORNIA INC. 711 VAN NESS AVENUE, SUITE 300 SAN FRANCISCO CA 94102 (415) 474-0468 elaine.duncan@verizon.com Chris Witteman Legal Division RM. 5129 505 VAN NESS AVE San Francisco CA 94102 (415) 355-5524 wit@cpuc.ca.gov

(END OF APPENDIX A)

²¹⁴ This agreement between the Applicants, Greenlining and LIF is referred to as the "Greenlining Agreement."