7. SETTLEMENT AGREEMENT; RELEASE OF CLAIMS.

a. Release of Claims and Covenant Not to Sue. Subject to the other provisions of this paragraph, the parties release any and all claims against each other that were the subject of the scope of issues as set forth in the May 10, 2002 Ruling Setting Scope and Schedule issued by the Assigned Commissioner and Assigned Administrative Law Judge in Case 01-07-027 before the CPUC (hereafter the "Scoping Memo"), and are alleged to have occurred between May 4, 2000 and August 12, 2002, without regard to the statutes or causes of action, including but not limited to release with prejudice of the Complaint. CISPA shall not (i) advance in any other proceeding the same claims that it advanced in Case 01-07-027 before the CPUC as embodied in the Scoping Memo and allegedly occurring between May 4, 2000 and August 12, 2002, or (ii) otherwise use the facts that were the basis for the claims advanced in Case 01-07-027 before the CPUC as embodied in the Scoping Memo to advocate or publicize a position adverse to any SBC affiliate. This Settlement is expressly contingent on acknowledgement by the Commission that the Complaint proceeding has been terminated by approval of the Settlement as the means for resolving the allegations contained in this Complaint proceeding. The Parties agree to work expeditiously to prepare and to file a joint motion requesting approval of the Settlement pursuant to Rule 51 of the Commission's Rules of Practice and Procedure and applicable Commission Rulings. Each party shall use its best efforts to obtain such Commission approval. Each parties' substantive obligations under this Agreement shall become effective upon Commission approval of the Settlement.

In exchange for the consideration set forth in this Agreement and in accordance with the provisions set forth above, CISPA and Defendants hereby waive, release and forever discharge the other of and from any and all manner of action or actions, cause or causes of action, in law or in equity, suits, administrative proceedings, debts, liens, contracts, agreements, promises, liability, claims, demands, damages, loss, cost or expense, of any nature whatsoever, fixed or contingent (hereinafter called "Claims"), which any releasing party or their attorneys, employees, agents, affiliates, or successors may have by reason of any matter, cause, thing or Claims arising out of or based upon, any and all claims asserted in the Complaint as embodied in the Scoping Memo. These terms represent a full and final settlement of any and all claims arising out of any allegations or claims arising out of the Complaint as embodied in the Scoping Memo and alleged to have occurred between May 4, 2000 and August 12, 2002, and any claimed violation of law (including but not limited to local, state or federal), which relates to or arises from the facts or allegations in the Complaint as embodied in the Scoping Memo.

CISPA and Defendants shall not prepare, file, institute, maintain, or prosecute any claim, lawsuit, complaint, administrative proceeding or other action or proceedings against the other arising out of or based upon, any and all facts that were the basis for the claims advanced in Case 01-07-027 before the California CPUC as embodied in the Scoping Memo and allegedly occurring between May 4, 2000 and August 12, 2002, or any alleged violations of any local, state or federal law or regulation arising out of, based upon or relating to the claims advanced in Case 01-07-027 before the California CPUC as embodied in the Scoping Memo. Nothing in this paragraph should be construed to prevent CISPA, SBC California or ASI from responding to discovery propounded upon it by a third party or to otherwise prevent it from complying with a legal obligation to provide information to the CPUC or any third party pursuant to any compulsory legal process. The parties further agree that the deletion of language from the Settlement Agreement filed in Case No. 01-07-027 on August 12, 2002 regarding the legal effect of this Settlement shall not be used or construed by one Party against the other Party.

The parties shall issue a joint press release within three (3) business days following the Effective Date of this Agreement. The content of any such press release shall be jointly agreed upon in advance.

b. Representations and Warranties

CISPA hereby represents and warrants (i) it is a non-profit corporation duly organized, validly existing and in good standing under the laws of the state of California, and has all the authority to operate as a non-profit organization; (ii) the execution and delivery of this Settlement Agreement, and its performance hereunder, have been duly and validly authorized by all necessary corporate action of CISPA, and this Settlement Agreement constitutes a valid and binding obligation of CISPA enforceable in accordance with its terms; (iii) neither the execution and delivery hereof nor the performance by CISPA hereunder will (a) conflict with or result in a violation or breach or failure to follow or comply with the charter documents of CISPA including its bylaws or any membership agreements, or any other agreement, instrument or obligation to which CISPA is a party or by which CISPA may be bound or affected, or (b) result in the violation of any order, writ, injunction, decree, statute, rule or regulation applicable to CISPA; and (iv) no consent or approval by, or notification to or filing with, any third party is required in connection with the execution, delivery and performance of this agreement by CISPA.