Ameritech Corp/DE – ‘8-K’ for 5/11/98 – EX-2

As of:  Monday, 5/11/98   ·   For:  5/11/98   ·   Accession #:  950172-98-460   ·   File #:  1-08612

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         3±    12K 
 2: EX-2        Agreement and Plan of Merger                          54±   261K 
 3: EX-99       Press Release                                          5±    19K 

EX-2   —   Agreement and Plan of Merger
Exhibit Table of Contents

                                                        EXECUTION COPY

AGREEMENT AND PLAN OF MERGER    

Among     

AMERITECH CORPORATION     

SBC COMMUNICATIONS INC.     

and     

SBC DELAWARE, INC.    

Dated as of May 10, 1998    

TABLE OF CONTENTS     

                                                                  PAGE

RECITALS    

ARTICLE I     

The Merger; Closing; Effective Time     

1.1.    The Merger.....................................................1        
1.2.    Closing........................................................2        
1.3.    Effective Time.................................................2        

ARTICLE II    

Certificate of Incorporation and ByLaws         
of the Surviving Corporation    

2.1.    The Certificate of Incorporation...............................2        
2.2.    The ByLaws.....................................................3        

ARTICLE III     

Officers and Directors    

3.1.    Directors of Surviving Corporation.............................3        
3.2.    Officers of Surviving Corporation..............................3        
3.3.    Election to SBC's Board of Directors...........................3        

ARTICLE IV    

Effect of the Merger on Capital Stock;        
Exchange of Certificates    

4.1.    Effect on Capital Stock........................................4        
(a) Merger Consideration.......................................4
(b) Cancellation of Shares.....................................5
(c) Merger Sub.................................................5
4.2.    Exchange of Certificates for Shares............................5        
(a) Exchange Procedures........................................5
(b) Distributions with Respect to Unexchanged                   
Shares; Voting.................................................7
(c) Transfers..................................................8
(d) Fractional Shares..........................................8
(e) Termination of Exchange Period; Unclaimed                   
Stock..........................................................8
(f) Lost, Stolen or Destroyed Certificates.....................9
(g) Affiliates.................................................9
4.3.    Dissenters' Rights.............................................9        
4.4.    Adjustments to Prevent Dilution...............................10        

ARTICLE V     

Representations and Warranties    

5.1.    Representations and Warranties of the Company, SBC                      
and Merger Sub................................................10
(a) Organization, Good Standing and                             
Qualification.................................................10
(b) Capital Structure.........................................11
(c) Corporate Authority; Approval and                           
Fairness......................................................14
(d) Governmental Filings; No Violations.......................15
(e) Reports; Financial Statements.............................17
(f) Absence of Certain Changes................................18
(g) Litigation and Liabilities................................19
(h) Employee Benefits.........................................19
(i) Compliance with Laws......................................22
(j) Takeover Statutes.........................................23
(k) Environmental Matters.....................................23
(l) Accounting and Tax Matters................................24
(m) Taxes.....................................................25
(n) Labor Matters.............................................26
(o) Rights Agreement..........................................26
(p) Brokers and Finders.......................................26

ARTICLE VI    

Covenants     

6.1.    Interim Operations............................................27        
6.2.    Acquisition Proposals.........................................33        
6.3.    Information Supplied..........................................37        
6.4.    Stockholders Meetings.........................................38        
6.5.    Filings; Other Actions; Notification..........................38        
6.6.    Access; Consultation..........................................41        
6.7.    Affiliates....................................................42        
6.8.    Stock Exchange Listing and Delisting..........................43        
6.9.    Publicity.....................................................43        
6.10.   Benefits......................................................43        
(a) Stock Options.............................................43
(b) Employee Benefits.........................................45
6.11.   Expenses......................................................45        
6.12.   Indemnification; Directors' and Officers'                               
Insurance.....................................................45
6.13.   Takeover Statute..............................................47        
6.14.   Dividends.....................................................48        
6.15.   Confidentiality...............................................48        
6.16.   Control of the Company's Operations...........................48        

ARTICLE VII     

Conditions    

7.1.    Conditions to Each Party's Obligation to Effect the                     
Merger........................................................48
(a) Stockholder Approval......................................49
(b) NYSE Listing..............................................49
(c) Governmental Consents.....................................49
(d) Laws and Order............................................50
(e) S4........................................................50
(f) Accountants' Letters......................................50
(g) Blue Sky Approvals........................................50
7.2.    Conditions to Obligations of SBC and Merger Sub...............50        
(a) Representations and Warranties............................50
(b) Performance of Obligations of the Company.................51
(c) Consents Under Agreements.................................51
(d) Tax Opinion...............................................51
7.3.    Conditions to Obligation of the Company.......................51        
(a) Representations and Warranties............................51
(b) Performance of Obligations of SBC and                       
Merger Sub....................................................52
(c) Tax Opinion...............................................52

ARTICLE VIII    

Termination     

8.1.    Termination by Mutual Consent.................................52        
8.2.    Termination by Either SBC or the Company......................52        
8.3.    Termination by the Company....................................53        
8.4.    Termination by SBC............................................55        
8.5.    Effect of Termination and Abandonment.........................56        

ARTICLE IX    

Miscellaneous and General     

9.1.    Survival......................................................58        
9.2.    Modification or Amendment.....................................58        
9.3.    Waiver of Conditions..........................................59        
9.4.    Counterparts..................................................59        
9.5.    GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL.................59        
9.6.    Notices.......................................................60        
9.7.    Entire Agreement..............................................62        
9.8.    No Third Party Beneficiaries..................................62        
9.9.    Obligations of SBC and of the Company.........................62        
9.10.   Severability..................................................62        
9.11.   Interpretation................................................63        
9.12.   Captions......................................................63        
9.13.   Assignment....................................................63        

EXHIBITS                                                                        

A       Form of Company Affiliate's Letter . . . . . . .  A1                    

B       Form of SBC Affiliate's Letter . . . . . . . . .  B1                    

INDEX OF DEFINED TERMS    

Term                                                             Section        

Affiliate.........................................................6.7(a)        
Agreement...................................................... preamble        
Audit Date....................................................... 5.1(e)        
Bankruptcy and Equity Exception................................5.1(c)(i)        
ByLaws...........................................................    2.2        
Certificate...................................................... 4.1(a)        
Certificate Letter of Transmittal.................................4.2(a)        
Certificate of Merger............................................    1.3        
Charter..........................................................    2.1        
Closing..........................................................    1.2        
Closing Date.....................................................    1.2        
Code........................................................... recitals        
Company........................................................ preamble        
Company Acquisition Proposal......................................6.2(a)        
Company Affiliate's Letter....................................... 6.7(a)        
Company Compensation and Benefit Plans.........................5.1(h)(i)        
Company Disclosure Letter........................................    5.1        
Company Option................................................6.10(a)(i)        
Company Preference Shares......................................5.1(b)(i)        
Company Preferred Shares.......................................5.1(b)(i)        
Company Representatives...........................................6.2(a)        
Company Required Consents......................................5.1(d)(i)        
Company Requisite Vote.......................................  5.1(c)(i)        
Company Share.....................................................4.1(a)        
Company Shares................................................... 4.1(a)        
Company Stock Plans..........................................  5.1(b)(i)        
Company Stock Units...........................................6.10(a)(i)        
Company Stockholders Meeting....................................     6.4        
Compensation and Benefit Plans................................5.1(h)(ii)        
Confidentiality Agreement........................................   6.15        
Constituent Corporations........................................preamble        
Contracts.....................................................5.1(d)(ii)        
Costs............................................................6.12(a)        
Current Premium..................................................6.12(c)        
D&O Insurance....................................................6.12(c)        
DGCL..............................................................   1.1        
Director Designees...............................................    3.3        
Disclosure Letter................................................    5.1        
Effective Time...................................................    1.3        
Environmental Law................................................ 5.1(k)        
ERISA.........................................................5.1(h)(ii)        
ERISA Affiliate..............................................5.1(h)(iii)        
ERISA Affiliate Plan.........................................5.1(h)(iii)        
Exchange Act...................................................5.1(b)(i)        
Exchange Agent................................................... 4.2(a)        
Exchange Ratio................................................... 4.1(a)        
Excluded Company Shares.......................................... 4.1(a)        
FCC............................................................5.1(d)(i)        
Final Order...................................................... 7.1(c)        
GAAP............................................................. 5.1(e)        
Governmental Entity............................................5.1(d)(i)        
Hazardous Substance.............................................. 5.1(k)        
HSR Act......................................................  5.1(d)(i)        
Indemnified Parties..............................................6.12(a)        
Initial 50 Day Period............................................ 8.3(b)        
IRS...........................................................5.1(h)(ii)        
Laws............................................................. 5.1(i)        
Material Adverse Effect.......................................... 5.1(a)        
Merger......................................................... recitals        
Merger Consideration............................................. 4.1(a)        
Merger Sub......................................................preamble        
NYSE..............................................................   6.8        
Order............................................................ 7.1(d)        
Pension Plan..................................................5.1(h)(ii)        
Permits...........................................................5.1(i)        
Person............................................................4.2(a)        
Prospectus/Proxy Statement.......................................... 6.3        
PUC..........................................................  5.1(d)(i)        
Registered Company Shares.........................................4.1(a)        
Registered Letter of Transmittal..................................4.2(a)        
Registered SBC Shares............................................ 4.2(a)        
Regulatory Material Adverse Effect................................6.5(c)        
Reports.......................................................... 5.1(e)        
Rights Agreement.............................................  5.1(b)(i)        
Rights Amendment...............................................   5.1(o)        
S4 Registration Statement..........................................  6.3        
SBC.............................................................preamble        
SBC Acquisition Proposal......................................... 6.2(b)        
SBC Affiliate's Letter........................................... 6.7(a)        
SBC Common Stock................................................. 4.1(a)        
SBC Companies.................................................... 4.1(a)        
SBC Disclosure Letter.............................................   5.1        
SBC Preferred Shares..........................................5.1(b)(ii)        
SBC Representatives.............................................. 6.2(b)        
SBC Required Consents..........................................5.1(d)(i)        
SBC Requisite Vote............................................5.1(c)(ii)        
SBC Rights....................................................... 4.1(a)        
SBC Rights Agreement..........................................5.1(b)(ii)        
SBC Stock Plans...............................................5.1(b)(ii)        
SBC Stock Units...............................................6.10(a)(i)        
SBC Stockholders Meeting.........................................    6.4        
SEC.............................................................  5.1(e)        
Securities Act.................................................5.1(d)(i)        
Significant Subsidiary.........................................5.1(b)(i)        
SNET ....................................................... 6.1(b)(vii)        
SNET Agreement ............................................. 6.1(b)(vii)        
Stockholders Meeting.................................................6.4        
Subsidiary.....................................................   5.1(a)        
Substitute Option.............................................6.10(a)(i)        
Substitute Option Price.......................................6.10(a)(i)        
Superior Company Proposal.......................................  6.2(a)        
Superior SBC Proposal............................................ 6.2(b)        
Surviving Corporation...........................................     1.1        
Takeover Statute................................................  5.1(j)        
Tax.............................................................  5.1(m)        
Tax Return......................................................  5.1(m)        
Taxable.........................................................  5.1(m)        
Taxes...........................................................  5.1(m)        
Termination Date...............................................   8.2(i)        
Termination Fee.................................................  8.5(b)        
Utilities Laws.................................................5.1(d)(i)        

AGREEMENT AND PLAN OF MERGER    

AGREEMENT AND PLAN OF MERGER (hereinafter called this   
"Agreement"), dated as of May 10, 1998, among Ameritech Corporation, a          
Delaware corporation (the "Company"), SBC Communications Inc., a Delaware       
corporation ("SBC"), and SBC Delaware, Inc., a Delaware corporation and a       
wholly-owned subsidiary of SBC ("Merger Sub," the Company and Merger Sub        
sometimes being hereinafter together referred to as the "Constituent            
Corporations").                                                                 

RECITALS    

   WHEREAS, the respective Boards of Directors of each of SBC,
Merger Sub and the Company have approved this Agreement and the merger of       
Merger Sub with and into the Company (the "Merger") upon the terms and          
subject to the conditions set forth in this Agreement;                          

      WHEREAS, it is intended that, for federal income tax purposes,
the Merger shall qualify as a reorganization under the provisions of            
Section 368(a) of the Internal Revenue Code of 1986, as amended, and the        
rules and regulations promulgated thereunder (the "Code");                      

       WHEREAS, for financial accounting purposes, it is intended that
the Merger shall be accounted for as a "pooling-of-interests;" and              

       WHEREAS, the Company, SBC and Merger Sub desire to make certain
representations, warranties, covenants and agreements in connection with        
this Agreement.                                                                 

    NOW, THEREFORE, in consideration of the premises, and of the
representations, warranties, covenants and agreements contained herein, the     
parties hereto agree as follows:                                                

ARTICLE I     

The Merger; Closing; Effective Time     

     1.1. The Merger. Upon the terms and subject to the conditions
set forth in this Agreement, at the Effective Time (as defined in Section       
1.3) Merger Sub shall be merged with and into the Company and the separate      
corporate existence of Merger Sub shall thereupon cease. The Company shall      
be the surviving corporation in the Merger (sometimes hereinafter referred      
to as the "Surviving Corporation") and shall continue to be governed by the     
laws of the State of Delaware, and the separate corporate existence of the      
Company with all its rights, privileges, immunities, powers and franchises      
shall continue unaffected by the Merger except as set forth in Article III      
hereof. The Merger shall have the effects specified in the Delaware General     
Corporation Law, as amended (the "DGCL").                                       

     1.2. Closing. The closing of the Merger (the "Closing") shall
take place (i) at the offices of Sullivan & Cromwell, 125 Broad Street, New     
York, New York 10004 at 9:00 A.M., local time, on the second business day       
after the date on which the last to be fulfilled or waived of the               
conditions set forth in Article VII (other than those conditions that by        
their nature are to be satisfied at the Closing, but subject to the             
fulfillment or waiver of those conditions) shall be satisfied or waived in      
accordance with this Agreement or (ii) at such other place and time and/or      
on such other date as the Company and SBC may agree in writing (the             
"Closing Date").                                                                

   1.3. Effective Time. Immediately following the Closing, the
Company and SBC will cause a Certificate of Merger (the "Certificate of         
Merger") to be executed, acknowledged and filed with the Secretary of State     
of Delaware as provided in Section 251 of the DGCL. The Merger shall become     
effective at the time when the Certificate of Merger has been duly filed        
with the Secretary of State of Delaware or such other time as shall be          
agreed upon by the parties and set forth in the Certificate of Merger in        
accordance with the DGCL (the "Effective Time").                                

ARTICLE II    

Certificate of Incorporation and By-Laws        
of the Surviving Corporation    

 2.1. The Certificate of Incorporation. The certificate of
incorporation of the Company as in effect immediately prior to the              
Effective Time shall be the certificate of incorporation of the Surviving       
Corporation (the "Charter"), until duly amended as provided therein or by       
applicable law, except that (i) Article Fourth of the Charter shall be          
amended to read in its entirety as follows: "FOURTH. The aggregate number       
of shares that the Corporation shall have the authority to issue is 1,000       
shares of Common Stock, par value $1.00 per share."; (ii) Article Fifth of      
the Charter shall be deleted in its entirety and shall read as follows:         
"FIFTH. Reserved."; (iii) Article Eighth, Section B of the Charter shall be     
amended to read in its entirety as follows: "B. Number. The number of           
directors, their terms and their manner of election shall be fixed by or        
pursuant to the ByLaws of the Corporation."; (iv) Article Ninth of the          
Charter shall be deleted in its entirety and shall read as follows: "NINTH.     
Reserved." and (v) Article Tenth of the Charter shall be amended to read in     
its entirety as follows: "TENTH. The Corporation reserves the right to          
amend, alter, change or repeal any provision contained in this Certificate      
of Incorporation, in any manner now or hereafter permitted or prescribed by     
statute."                                                                       

    2.2. The By-Laws. The by-laws of Merger Sub in effect at the
Effective Time shall be the by-laws of the Surviving Corporation (the           
"By-Laws"), until thereafter amended as provided therein or by applicable       
law.                                                                            

ARTICLE III     

Officers and Directors    

 3.1. Directors of Surviving Corporation. The directors of
Merger Sub at the Effective Time shall, from and after the Effective Time,      
be the directors of the Surviving Corporation until their successors have       
been duly elected or appointed and qualified or until their earlier death,      
resignation or removal in accordance with the Charter and the By-Laws.          

   3.2. Officers of Surviving Corporation. The officers of the
Company at the Effective Time shall, from and after the Effective Time, be      
the officers of the Surviving Corporation until their successors have been      
duly elected or appointed and qualified or until their earlier death,           
resignation or removal in accordance with the Charter and the By-Laws.          

   3.3. Election to SBC's Board of Directors. At the Effective
Time of the Merger, SBC shall increase the size of its Board of Directors       
in order to enable up to five members of the Board of Directors of the          
Company to be members of the SBC Board of Directors, which persons shall be     
selected by the SBC Board of Directors in consultation with the Chief           
Executive Officer of the Company and the Board of Directors of the Company      
(the "Director Designees"), and the SBC Board of Directors shall appoint        
each of the Director Designees to the SBC Board of Directors as of the          
Effective Time, with such Director Designees to be divided as nearly evenly     
as is possible among the classes of directors of SBC.                           

ARTICLE IV    

Effect of the Merger on Capital Stock;        
Exchange of Certificates    

 4.1. Effect on Capital Stock. At the Effective Time, as a
result of the Merger and without any action on the part of the holder of        
any capital stock of the Company:                                               

             (a) Merger Consideration. Each share of Common Stock,
$1.00 par value per share, of the Company (each a "Company Share" and           
together the "Company Shares") issued and outstanding immediately prior to      
the Effective Time (other than Company Shares that are owned by SBC, Merger     
Sub or any other direct or indirect subsidiary of SBC (collectively, the        
"SBC Companies") or Company Shares that are owned by the Company or any         
direct or indirect subsidiary of the Company and in each case not held on       
behalf of third parties (collectively, "Excluded Company Shares")) shall be     
converted into and become exchangeable for 1.316 (the "Exchange Ratio")         
shares of Common Stock, par value $1.00 per share, of SBC ("SBC Common          
Stock"), subject to adjustment as provided in Section 4.4 (the "Merger          
Consideration"). All references in this Agreement to SBC Common Stock to be     
issued pursuant to the Merger shall be deemed to include the corresponding      
rights ("SBC Rights") to purchase shares of SBC Participating Preferred         
Stock pursuant to the SBC Rights Agreement (as defined in Section               
5.1(b)(ii)), except where the context otherwise requires. At the Effective      
Time, all Company Shares shall no longer be outstanding, shall be cancelled     
and retired and shall cease to exist, and (A) each certificate(a                
"Certificate") formerly representing any of such Company Shares (other than     
Excluded Company Shares) and (B) each uncertificated Company Share a            
"Registered Company Share") registered to a holder on the stock transaction     
books of the Company (other than Excluded Company Shares), shall thereafter     
represent only the right to the Merger Consideration and the right, if any,     
to receive pursuant to Section 4.2(d) cash in lieu of fractional shares         
into which such Company Shares have been converted pursuant to this Section     
4.1(a) and any distribution or dividend pursuant to Section 4.2(b), in each     
case without interest.                                                          

               (b) Cancellation of Shares. Each Excluded Company Share
issued and outstanding immediately prior to the Effective Time shall, by        
virtue of the Merger and without any action on the part of the holder           
thereof, no longer be outstanding, shall be cancelled and retired without       
payment of any consideration therefor and shall cease to exist.                 

            (c) Merger Sub. At the Effective Time, each share of
Common Stock, par value $1.00 per share, of Merger Sub issued and               
outstanding immediately prior to the Effective Time shall be converted into     
one share of common stock of the Surviving Corporation, and the Surviving       
Corporation shall be a wholly-owned subsidiary of SBC.                          

4.2.    Exchange of Certificates for Shares.            

             (a) Exchange Procedures. Promptly after the Effective
Time, the Surviving Corporation shall cause an exchange agent selected by       
SBC with the Company's prior approval, which shall not be unreasonably          
withheld (the "Exchange Agent") to mail to each holder of record as of the      
Effective Time of a Certificate or Registered Company Shares, as the case       
may be, (other than holders of a Certificate or Registered Company Shares       
in respect of Excluded Company Shares) (i) (x) in the case of holders of        
Certificates, a letter of transmittal specifying that delivery shall be         
effected, and that risk of loss and title to the Certificates shall pass,       
only upon delivery of the Certificates (or affidavits of loss in lieu           
thereof) to the Exchange Agent (the "Certificate Letter of Transmittal") or     
(y) in the case of holders of Registered Company Shares, a letter of            
transmittal specifying that the exchange for SBC Shares shall occur only        
upon delivery of such letter of transmittal to the Exchange Agent (the          
"Registered Letter of Transmittal"), each such letter of transmittal to be      
in such form and have such other provisions as SBC and the Company              
may reasonably agree, and (ii) instructions for exchanging Certificates or      
Registered Company Shares for (A) uncertificated shares of SBC Common Stock     
registered on the stock transfer books of SBC in the name of such holder        
("Registered SBC Shares") or, at the election of such holder, certificates      
representing shares of SBC Common Stock and (B) any unpaid dividends and        
other distributions and cash in lieu of fractional shares. Subject to           
Section 4.2(g), upon (I) surrender of a Certificate for cancellation to the     
Exchange Agent together with a Certificate Letter of Transmittal, duly          
executed, the holder of such Certificate or (II) upon delivery of a             
Registered Letter of Transmittal, duly executed, the holder of such             
Registered Company Shares, as the case may be, shall be entitled to receive     
in exchange therefor (x) Registered SBC Shares or, at the election of such      
holder, a certificate representing that number of whole shares of SBC           
Common Stock that such holder is entitled to receive pursuant to this           
Article IV, (y) a check in the amount (after giving effect to any required      
tax withholdings) of (A) any cash in lieu of fractional shares determined       
in accordance with Section 4.2(d) hereof plus (B) any cash dividends and        
any other dividends or other distributions that such holder has the right       
to receive pursuant to the provisions of this Article IV, and any               
Certificate so surrendered and any Registered Company Share in respect of       
which a Registered Letter of Transmittal is so delivered shall forthwith be     
cancelled. No interest will be paid or accrued on any amount payable upon       
due surrender of any Certificate or delivery of a duly executed Registered      
Letter of Transmittal, as the case may be. In the event of a transfer of        
ownership of Company Shares that is not registered in the transfer records      
of the Company, Registered SBC Shares or a certificate representing the         
proper number of shares of SBC Common Stock, as the case may be, together       
with a check for any cash to be paid upon due surrender of the Certificate      
or upon the delivery to the Exchange Agent of the duly executed Registered      
Letter of Transmittal and any other dividends or distributions in respect       
thereof, may be issued and/or paid to such a transferee if, in the case of      
holders of Certificates, the Certificate formerly representing such Company     
Shares is presented to the Exchange Agent, and, in the case of holders of       
Registered Company Shares, if the Registered Letter of Transmittal is           
delivered to the Exchange Agent in either case accompanied by all documents     
required to evidence and effect such transfer and to evidence that any          
applicable stock transfer taxes have been paid. If any Registered SBC           
Shares or any certificate for shares of SBC Common Stock is to be issued in     
a name other than that in which the Certificate surrendered in exchange         
therefor or the Registered Company Shares exchanged therefor, as the case       
may be, is registered, it shall be a condition of such exchange that the        
Person (as defined below) requesting such exchange shall pay any transfer       
or other taxes required by reason of the issuance of Registered SBC Shares      
or a certificate for shares of SBC Common Stock in a name other than that       
of the registered holder of the Certificate surrendered or the Registered       
Company Shares exchanged, as the case may be, or shall establish to the         
satisfaction of SBC or the Exchange Agent that such tax has been paid or is     
not applicable.                                                                 

   For the purposes of this Agreement, the term "Person" shall
mean any individual, corporation (including not-for-profit), general or         
limited partnership, limited liability company, joint venture, estate,          
trust, association, organization, Governmental Entity (as defined in            
Section 5.1(d)(i)) or other entity of any kind or nature.                       

(b) Distributions with Respect to     
Unexchanged Shares; Voting.     

        (i) Whenever a dividend or other distribution is
declared by SBC in respect of SBC Common Stock, the record date for which       
is at or after the Effective Time, that declaration shall include dividends     
or other distributions in respect of all shares of SBC Common Stock             
issuable pursuant to this Agreement. No dividends or other distributions in     
respect of such SBC Common Stock shall be paid to any holder of any             
unsurrendered Certificate or Registered Company Shares for which a              
Registered Letter of Transmittal shall not have been delivered, until such      
Certificate is surrendered for exchange or such Registered Letter of            
Transmittal is delivered, as the case may be, in accordance with this           
Article IV. Subject to the effect of applicable laws, following surrender       
of any such Certificate or delivery of any such Registered Letter of            
Transmittal, as the case may be, there shall be issued and/or paid to the       
holder of the Registered SBC Shares or the certificates representing whole      
shares of SBC Common Stock, as the case may be, issued in exchange              
therefor, without interest, (A) at the time of such surrender or delivery,      
as the case my be, the dividends or other distributions with a record date      
after the Effective Time and a payment date on or prior to the date of          
issuance of such whole shares of SBC Common Stock and not previously paid       
and (B) at the appropriate payment date, the dividends or other                 
distributions payable with respect to such whole shares of SBC Common Stock     
with a record date after the Effective Time but with a payment date             
subsequent to surrender or delivery, as the case may be. For purposes of        
dividends or other distributions in respect of shares of SBC Common Stock,      
all shares of SBC Common Stock to be issued pursuant to the Merger shall be     
deemed issued and outstanding as of the Effective Time.                         

             (ii) Registered holders of unsurrendered Certificates
or Registered Company Shares for which a duly executed Registered Letter of     
Transmittal shall not have been delivered shall be entitled to vote after       
the Effective Time at any meeting of SBC stockholders with a record date at     
or after the Effective Time the number of whole shares of SBC Common Stock      
represented by such Certificates or Registered Company Shares, as the case      
may be, regardless of whether such holders have surrendered their               
Certificates or delivered duly executed Registered Letters of Transmittal,      
as the case may be.                                                             

               (c) Transfers. After the Effective Time, there shall be
no transfers on the stock transfer books of the Company of the Company          
Shares that were outstanding immediately prior to the Effective Time.           

        (d) Fractional Shares. Notwithstanding any other
provision of this Agreement, no fractional shares of SBC Common Stock will      
be issued and any holder of Company Shares entitled to receive a fractional     
share of SBC Common Stock but for this Section 4.2(d) shall be entitled to      
receive an amount in cash (without interest) determined by multiplying such     
fraction (rounded to the nearest onehundredth of a share) by the average of     
the closing price of a share of SBC Common Stock, as reported in The Wall       
Street Journal, New York City edition, on the trading day immediately prior     
to the Effective Time.                                                          

            (e) Termination of Exchange Period; Unclaimed Stock.
Any shares of SBC Common Stock and any portion of the cash, dividends or        
other distributions with respect to the SBC Common Stock deposited by SBC       
with the Exchange Agent (including the proceeds of any investments thereof)     
that remain unclaimed by the stockholders of the Company 180 days after the     
Effective Time shall be paid to SBC. Any stockholders of the Company who        
have not theretofore complied with this Article IV shall thereafter look        
only to SBC for payment of their shares of SBC Common Stock and any cash,       
dividends and other distributions in respect thereof issuable and/or            
payable pursuant to Section 4.1, Section 4.2(b) and Section 4.2(d) upon due     
(i) surrender of (i) their Certificates (or affidavits of loss in lieu          
thereof) or (ii) delivery of duly executed Registered Letters of                
Transmittal, as the case may be, in each case with respect to both clause       
(i) and (ii), without any interest thereon. Notwithstanding the foregoing,      
none of SBC, the Surviving Corporation, the Exchange Agent or any other         
Person shall be liable to any former holder of Company Shares for any           
amount properly delivered to a public official pursuant to applicable           
abandoned property, escheat or similar laws.                                    

          (f) Lost, Stolen or Destroyed Certificates. In the
event any Certificate shall have been lost, stolen or destroyed, upon the       
making of an affidavit of that fact by the Person claiming such Certificate     
to be lost, stolen or destroyed and the posting by such Person of a bond in     
the form customarily required by SBC as indemnity against any claim that        
may be made against it with respect to such Certificate, SBC will issue the     
shares of SBC Common Stock and the Exchange Agent will issue any cash,          
dividends and other distributions in respect thereof issuable and/or            
payable in exchange for such lost, stolen or destroyed Certificate pursuant     
to Section 4.1, Section 4.2(b) and Section 4.2(d) upon due surrender of and     
deliverable in respect of the Company Shares represented by such                
Certificate pursuant to this Agreement, in each case, without interest.         

              (g) Affiliates. Notwithstanding anything herein to the
contrary, Certificates surrendered for exchange, or Registered Company          
Shares to be exchanged pursuant to a Registered Letter of Transmittal           
delivered, by any "affiliate" (as determined pursuant to Section 6.7) of        
the Company shall not be exchanged until SBC has received a written             
agreement from such Person as provided in Section 6.7 hereof.                   

      4.3. Dissenters' Rights. In accordance with Section 262 of the
DGCL, no appraisal rights shall be available to holders of Company Shares       
in connection with the Merger.                                                  

     4.4. Adjustments to Prevent Dilution. In the event that prior
to the Effective Time there is a change in the number of Company Shares or      
shares of SBC Common Stock or securities convertible or exchangeable into       
or exercisable for Company Shares or shares of SBC Common Stock issued and      
outstanding as a result of a distribution, reclassification, stock split        
(including a reverse split), stock dividend or distribution, or other           
similar transaction, the Exchange Ratio shall be equitably adjusted to          
eliminate the effects of such event.                                            

ARTICLE V     

Representations and Warranties    

   5.1. Representations and Warranties of the Company, SBC and
Merger Sub. Except as set forth in the corresponding sections or                
subsections of the disclosure letter, dated the date hereof, delivered by       
the Company to SBC or by SBC to the Company (each a "Disclosure Letter",        
and the "Company Disclosure Letter" and the "SBC Disclosure Letter",            
respectively), as the case may be, the Company (except for subparagraphs        
(b)(ii), (b)(iii), (c)(ii) and (p)(ii) below and references in                  
subparagraphs (a) and (e) below to documents made available by SBC to the       
Company) hereby represents and warrants to SBC and Merger Sub, and SBC          
(except for subparagraphs (b)(i), (c)(i), (d)(iii), the last sentence of        
(f), (j), (o) and (p)(i) below and references in subparagraphs (a), (e) and     
(h)(i) below to documents made available by the Company to SBC), on behalf      
of itself and Merger Sub, hereby represents and warrants to the Company,        
that:                                                                           

     (a) Organization, Good Standing and Qualification. Each of it
and its Subsidiaries is a corporation duly organized, validly existing and      
in good standing under the laws of its respective jurisdiction of               
organization and has all requisite corporate or similar power and authority     
to own and operate its properties and assets and to carry on its business       
as presently conducted and is qualified to do business and is in good           
standing as a foreign corporation in each jurisdiction where the ownership      
or operation of its properties or conduct of its business requires such         
qualification, except where the failure to be so qualified or in good           
standing is not, when taken together with all other such failures,              
reasonably likely to have a Material Adverse Effect (as defined below) on       
it. It has made available to SBC, in the case of the Company, and to the        
Company, in the case of SBC, a complete and correct copy of its certificate     
of incorporation and by-laws, each as amended to date. Such certificates of     
incorporation and by-laws as so made available are in full force and            
effect.                                                                         

   As used in this Agreement, (i) the term "Subsidiary" means,
with respect to the Company, SBC or Merger Sub, as the case may be, any         
entity, whether incorporated or unincorporated, of which at least fifty         
percent of the securities or ownership interests having by their terms          
ordinary voting power to elect at least fifty percent of the Board of           
Directors or other persons performing similar functions is directly or          
indirectly owned by such party or by one or more of its respective              
Subsidiaries or by such party and any one or more of its respective             
Subsidiaries, (ii) the term "Material Adverse Effect" means, with respect       
to either SBC or the Company, as the case may be, a material adverse            
effect, it being understood that materiality shall be determined by             
reference to the trading market equity value of such Person prior to the        
consummation of the Merger, other than effects resulting from the execution     
of this Agreement or the announcement thereof or changes in (I) the             
telecommunications industry generally, (II) the national economy generally      
or (A) with respect to SBC only, the economy of Texas, Oklahoma, Missouri,      
Kansas, Arkansas, Nevada and California, taken together, generally, or of       
France, Mexico and/or the Republic of South Africa or (B) with respect to       
the Company only, the economies of Illinois, Indiana, Michigan, Ohio and        
Wisconsin, taken together, generally, or of Belgium, Denmark and/or Hungary     
or (III) the securities markets generally, and (iii) reference to "the          
other party" means, with respect to the Company, SBC and means, with            
respect to SBC, the Company.                                                    

      (b) Capital Structure. (i) The authorized capital stock of the
Company consists of 2,400,000,000 Company Shares, of which 1,100,161,364        
Company Shares were issued and outstanding and 76,993,242 Company Shares        
were held in treasury as of the close of business on April 30, 1998,            
30,000,000 shares of Preferred Stock, $1.00 par value per share (the            
"Company Preferred Shares"), none of which were outstanding as of the close     
of business on May 8, 1998 and 30,000,000 shares of Preference Stock, $1.00     
par value per share, (the "Company Preference Shares"), none of which were      
outstanding as of the close of business on May 8, 1998. All of the              
outstanding Company Shares have been duly authorized and are validly            
issued, fully paid and nonassessable. Other than 12,000,000 Company             
Preference Shares, designated "Series A Junior Participating Preference         
Stock", reserved for issuance pursuant to the Rights Agreement, dated as of     
December 21, 1988, between the Company and American Transtech Inc., as          
Rights Agent (the "Rights Agreement"), and Company Shares subject to            
issuance as set forth below, the Company has no Company Shares, Company         
Preferred Shares or Company Preference Shares reserved for or otherwise         
subject to issuance. As of May 10, 1998, there were not more than               
47,000,000 Company Shares that the Company was obligated to issue pursuant      
to the Company Compensation and Benefit Plans identified in Section 5.1(h)      
of the Company Disclosure Letter as being the only Company Compensation and     
Benefit Plans pursuant to which Company Shares may be issued (collectively      
the "Company Stock Plans"). Each of the outstanding shares of capital stock     
or other securities of each of the Company's Subsidiaries that constitute a     
"Significant Subsidiary" (as defined in Rule 1.02(w) of Regulation S-X          
promulgated pursuant to the Securities Exchange Act of 1934, as amended         
(the "Exchange Act"), is duly authorized, validly issued, fully paid and        
nonassessable and owned by the Company or a direct or indirect wholly-owned     
Subsidiary of the Company, free and clear of any lien, pledge, security         
interest, claim or other encumbrance. Except as set forth above and for         
Company Shares and options to purchase Company Shares which may be issued       
in accordance with Section 6.1(a), there are no preemptive or other             
outstanding rights, options, warrants, conversion rights, stock                 
appreciation rights, redemption rights, repurchase rights, agreements,          
arrangements or commitments to issue or sell any shares of capital stock or     
other securities of the Company or any of its Significant Subsidiaries or       
any securities or obligations convertible or exchangeable into or               
exercisable for, or giving any Person a right to subscribe for or acquire,      
any securities of the Company or any of its Significant Subsidiaries, and       
no securities or obligations evidencing such rights are authorized, issued      
or outstanding. The Company does not have outstanding any bonds,                
debentures, notes or other obligations the holders of which have the right      
to vote (or convertible into or exercisable for securities having the right     
to vote) with the stockholders of the Company on any matter.                    

           (ii)     The authorized capital stock
of SBC consists of 7,000,000,000 shares of SBC Common Stock, of which           
1,838,844,294 shares were issued and outstanding and 26,060,210 shares were     
held in treasury as of the close of business on April 30, 1998, and             
10,000,000 shares of Preferred Stock, par value $1.00 per share (the "SBC       
Preferred Shares"), none of which shares were outstanding as of the close       
of business on May 8, 1998. All of the outstanding shares of SBC Common         
Stock have been duly authorized and are validly issued, fully paid and          
nonassessable. SBC has no shares of SBC Common Stock or SBC Preferred           
Shares reserved for or subject to issuance except that SBC has reserved no      
more than 10,000,000 SBC Preferred Shares for or subject to issuance            
pursuant to the Rights Agreement, dated as of January 27, 1989, between SBC     
and American Transtech, Inc., as Rights Agent, as amended by the Amendment      
of Rights Agreement, dated as of August 5, 1992, between SBC and The Bank       
of New York, as successor Rights Agent, and the Second Amendment of Rights      
Agreement, dated as of June 15, 1994, between SBC and The Bank of New York,     
as successor Rights Agent (as amended, the "SBC Rights Agreement"). As of       
May 10, 1998, there were not more than 92,000,000 shares of SBC Common          
Stock that SBC was obligated to issue pursuant to (x) SBC's Senior              
Management Long Term Incentive Plan, Senior Management Incentive Award          
Deferral Plan, Non-Employee Directors Stock and Deferral Plan, Stock            
Savings Plan, 1994 Stock Option Plan, 1996 Stock and Incentive Plan, 1995       
Management Stock Option Plan, Savings Plan and the Savings and Security         
Plan and (y) Pacific Telesis Group's Supplemental Retirement and Savings        
Plan for Salaried Employees, Supplemental Retirement and Savings Plan for       
NonSalaried Employees, Supplemental Retirement and Savings Plan for             
Salaried and NonSalaried Employees, Employee Stock Ownership Plan, Stock        
Option and Stock Appreciation Rights Plan, Outside Directors Deferred Stock     
Unit Plan and Restricted Stock Plan (collectively, the "SBC Stock Plans").      
Each of the outstanding shares of capital stock of each of SBC's                
Significant Subsidiaries is duly authorized, validly issued, fully paid and     
nonassessable and owned by SBC or a direct or indirect wholly-owned             
subsidiary of SBC, free and clear of any lien, pledge, security interest,       
claim or other encumbrance. Except as set forth above, there are no             
preemptive or other outstanding rights, options, warrants, conversion           
rights, stock appreciation rights, redemption rights, repurchase rights,        
agreements, arrangements or commitments to issue or to sell any shares of       
capital stock or other securities of SBC or any of its Significant              
Subsidiaries or any securities or obligations convertible or                    
exchangeable into or exercisable for, or giving any Person a right to           
subscribe for or acquire, any securities of SBC or any of its Significant       
Subsidiaries, and no securities or obligation evidencing such rights are        
authorized, issued or outstanding. SBC does not have outstanding any bonds,     
debentures, notes or other obligations the holders of which have the right      
to vote (or convertible into or exercisable for securities having the right     
to vote) with the stockholders of SBC on any matter.                            

          (iii)     The authorized capital stock
of Merger Sub consists of 1,000 shares of Common Stock, par value $1.00 per     
share, all of which are validly issued and outstanding. All of the issued       
and outstanding capital stock of Merger Sub is, and at the Effective Time       
will be, owned by SBC, and there are (i) no other shares of capital stock       
or other voting securities of Merger Sub, (ii) no securities of Merger Sub      
convertible into or exchangeable for shares of capital stock or other           
voting securities of Merger Sub and (iii) no options or other rights to         
acquire from Merger Sub, and no obligations of Merger Sub to issue, any         
capital stock, other voting securities or securities convertible into or        
exchangeable for capital stock or other voting securities of Merger Sub.        
Merger Sub has not conducted any business prior to the date hereof and has      
no, and prior to the Effective Time will have no, assets, liabilities or        
obligations of any nature other than those incident to its formation and        
pursuant to this Agreement and the Merger and the other transactions            
contemplated by this Agreement.                                                 

               (c) Corporate Authority; Approval and Fairness. (i) The
Company has all requisite corporate power and authority and has taken all       
corporate action necessary in order to execute, deliver and perform its         
obligations under this Agreement and to consummate, subject only to             
adoption of this Agreement by the holders of a majority of the outstanding      
Company Shares (the "Company Requisite Vote") and the Company Required          
Consents (as defined in Section 5.1(d)), the Merger. This Agreement has         
been duly executed and delivered by the Company and is a valid and binding      
agreement of the Company enforceable against the Company in accordance with     
its terms, subject to bankruptcy, insolvency, fraudulent transfer,              
reorganization, moratorium and similar laws of general applicability            
relating to or affecting creditors' rights and to general equity principles     
(the "Bankruptcy and Equity Exception"). The Board of Directors of the          
Company (A) has unanimously approved this Agreement and the Merger and the      
other transactions contemplated hereby and (B) has received the opinion of      
its financial advisors, Goldman, Sachs & Co., in a customary form and to        
the effect that the Merger Consideration to be received by the holders of       
the Company Shares in the Merger is fair to such holders from a financial       
point of view.                                                                  

             (ii)  SBC and Merger Sub each has
all requisite corporate power and authority and each has taken all              
corporate action necessary in order to execute, deliver and perform its         
obligations under this Agreement and to consummate, subject only to the         
approval by the stockholders of SBC by a majority of votes cast on the          
proposal to issue the shares of SBC Common Stock required to be issued          
pursuant to Article IV; provided, that the total vote cast represents over      
50% of all of the outstanding shares of SBC Common Stock (the "SBC              
Requisite Vote") and the SBC Required Consents (as defined in Section           
5.1(d)), the Merger. This Agreement has been duly executed and delivered by     
SBC and Merger Sub and is a valid and binding agreement of SBC and Merger       
Sub, enforceable against each of SBC and Merger Sub in accordance with its      
terms, subject to the Bankruptcy and Equity Exception. SBC has received the     
opinion of its financial advisors, Salomon Brothers Inc and Smith Barney        
Inc., in a customary form and to the effect that the Exchange Ratio is fair     
to SBC from a financial point of view. The shares of SBC Common Stock, when     
issued pursuant to this Agreement, will be validly issued, fully paid and       
nonassessable, and no stockholder of SBC will have any preemptive right of      
subscription or purchase in respect thereof.                                    

               (d) Governmental Filings; No Violations. (i) Other than
the necessary filings, notices and/or approvals (A) pursuant to Section         
1.3, (B) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as     
amended (the "HSR Act"), the Exchange Act and the Securities Act of 1933,       
as amended (the "Securities Act"), (C) to comply with state securities or       
"blue-sky" laws, (D) if any, of the Federal Communications Commission           
("FCC") pursuant to the Communications Act of 1934, as amended, (E) if any,     
of the local, state and foreign public utility commissions or similar           
local, state or foreign regulatory bodies (each a "PUC") and the local,         
state and foreign Governmental Entities (as defined below) identified in it     
respective Disclosure Letter pursuant to applicable local, state or foreign     
laws regulating the telephone, mobile cellular, paging, cable television or     
other telecommunications business ("Utilities Laws") and (F) if any, of the     
foreign regulatory bodies identified in its Disclosure Letter pursuant to       
applicable foreign laws regulating actions having the purpose or effect of      
monopolization or restraint of trade (such filings, notices and/or              
approvals of SBC being the "SBC Required Consents" and of the Company being     
the "Company Required Consents"), no filings, notices and/or reports are        
required to be made by it with, nor are any consents, registrations,            
approvals, permits or authorizations required to be obtained by it from,        
any governmental or regulatory authority, court, agency, commission, body       
or other governmental entity ("Governmental Entity"), in connection with        
the execution and delivery of this Agreement by it and the consummation by      
it of the Merger and the other transactions contemplated hereby, except         
those that the failure to make or obtain are not, individually or in the        
aggregate, reasonably likely to have a Material Adverse Effect on it or         
prevent, materially delay or materially impair its ability to consummate        
the transactions contemplated by this Agreement.                                

                     (ii) The execution, delivery and performance of
this Agreement by it do not, and the consummation by it of the Merger and       
the other transactions contemplated hereby will not, constitute or result       
in (A) a breach or violation of, or a default under, its certificate of         
incorporation or by-laws or the comparable governing instruments of any of      
its Significant Subsidiaries, (B) a breach or violation of, or a default        
under, the acceleration of any obligations or the creation of a lien,           
pledge, security interest or other encumbrance on its assets or the assets      
of any of its Subsidiaries (with or without notice, lapse of time or both)      
pursuant to, any agreement, lease, contract, note, mortgage, indenture,         
arrangement or other obligation ("Contracts") binding upon it or any of its     
Subsidiaries or, assuming the filings, notices and/or approvals referred to     
in Section 5.1(d)(i) are made or obtained, any Law (as defined in Section       
5.1(i)) or governmental or non-governmental permit or license to which it       
or any of its Subsidiaries is subject or (C) any change in the rights or        
obligations of any party under any of its Contracts, except, in the case of     
clause (B) or (C) above, for any breach, violation, default, acceleration,      
creation or change that, individually or in the aggregate, is not               
reasonably likely to have a Material Adverse Effect on it or prevent,           
materially delay or materially impair its ability to consummate the             
transactions contemplated by this Agreement. The Company Disclosure Letter,     
with respect to the Company, and the SBC Disclosure Letter, with respect to     
SBC, sets forth a correct and complete list of Contracts of it and its          
Subsidiaries pursuant to which consents or waivers are or may be required       
prior to consummation of the transactions contemplated by this Agreement        
other than those where the failure to obtain such consents or waivers is        
not, individually or in the aggregate, reasonably likely to have a Material     
Adverse Effect on it or prevent or materially impair its ability to             
consummate the transactions contemplated by this Agreement.                     

                    (e) Reports; Financial Statements. It has made
available to the other party, each registration statement, report, proxy        
statement or information statement prepared by it since December 31, 1997       
(the "Audit Date"), including its Annual Report on Form 10-K for the year       
ended December 31, 1997 in the form (including exhibits, annexes and any        
amendments thereto) filed with the Securities and Exchange Commission (the      
"SEC") (collectively, including any such reports filed subsequent to the        
date hereof, its "Reports"). As of their respective dates, its Reports did      
not contain any untrue statement of a material fact or omit to state a          
material fact required to be stated therein or necessary to make the            
statements made therein, in light of the circumstances in which they were       
made, not misleading. Each of the consolidated balance sheets included in       
or incorporated by reference into its Reports (including the related notes      
and schedules) fairly presents the consolidated financial position of it        
and its Subsidiaries as of its date and each of the consolidated statements     
of income and of cash flows included in or incorporated by reference into       
its Reports (including any related notes and schedules) fairly presents the     
consolidated results of operations, retained earnings and cash flows, as        
the case may be, of it and its Subsidiaries for the periods set forth           
therein (subject, in the case of unaudited statements, to notes and normal      
year-end audit adjustments that will not be material in amount or effect),      
in each case in accordance with United States generally accepted accounting     
principles ("GAAP") consistently applied during the periods involved,           
except as may be noted therein. Since the Audit Date, it and each               
Subsidiary required to make filings under Utilities Laws has filed with the     
applicable PUCs or the FCC, as the case may be, all material forms,             
statements, reports and documents (including exhibits, annexes and any          
amendments thereto) required to be filed by them, and each such filing          
complied in all material respects with all applicable laws, rules and           
regulations, other than such failures to file and non-compliance that are,      
individually or in the aggregate, not reasonably likely to have a Material      
Adverse Effect on it or prevent or materially impair its ability to             
consummate the transactions contemplated by this Agreement. To its              
knowledge, as of the date hereof, no Person or "group" "beneficially owns"      
5% or more of its outstanding voting securities, with the terms                 
"beneficially owns" and "group" having the meanings ascribed to them under      
Rule 13d-3 and Rule 13d-5 under the Exchange Act.                               

              (f) Absence of Certain Changes. Except as disclosed in
its Reports filed prior to the date hereof or as expressly contemplated or      
permitted by this Agreement, since the Audit Date it and its Subsidiaries       
have conducted their respective businesses only in, and have not engaged in     
any material transaction other than according to, the ordinary and usual        
course of such businesses and there has not been (i)any change in the           
financial condition, properties, prospects, business or results of              
operations of it and its Subsidiaries, except those changes that are not,       
individually or in the aggregate, reasonably likely to have a Material          
Adverse Effect on it; (ii) any damage, destruction or other casualty loss       
with respect to any asset or property owned, leased or otherwise used by it     
or any of its Subsidiaries, whether or not covered by insurance, which          
damage, destruction or loss is reasonably likely, individually or in the        
aggregate, to have a Material Adverse Effect on it; (iii) any declaration,      
setting aside or payment of any dividend or other distribution in respect       
of its capital stock, except publicly announced regular quarterly cash          
dividends on its common stock and, in the case of SBC, any dividends in         
capital stock of SBC which are simultaneously taken into account in an          
adjustment to the Exchange Ratio pursuant to Section 4.4; or (iv) any           
change by it in accounting principles, practices or methods, except as          
required by GAAP. Since the Audit Date, except as provided for herein, in       
the Company Disclosure Letter, as disclosed in the Reports filed by the         
Company prior to the date hereof or permitted hereby, there has not been        
any increase in the salary, wage, bonus or other compensation payable or        
that could become payable by the Company or any of its Subsidiaries to          
directors, officers or key employees or any amendment of any of the Company     
Compensation and Benefit Plans (as defined in Section 5.1(h)(i)) other than     
increases or amendments in the ordinary course.                                 

              (g) Litigation and Liabilities. Except as disclosed in
its Reports filed prior to the date hereof, there are no (i) civil,             
criminal or administrative actions, suits, claims, hearings, investigations     
or proceedings pending or, to the actual knowledge of its executive             
officers, threatened in writing against it or any of its Affiliates (as         
defined in Rule 12b-2 under the Exchange Act) or (ii) obligations or            
liabilities, whether or not accrued, contingent or otherwise and whether or     
not required to be disclosed, including those relating to matters involving     
any Environmental Law (as defined in Section 5.1(k)), or any other facts or     
circum stances, in either such case, of which its executive officers have       
actual knowledge that are reasonably likely to result in any claims against     
or obligations or liabilities of it or any of its Affiliates, except for        
those that are not, individually or in the aggregate, reasonably likely to      
have a Material Adverse Effect on it or prevent, materially delay or            
materially impair its ability to consummate the transactions contemplated       
by this Agreement; provided, however, that for purposes of this subsection      
(g) no action, suit, claim, hearing, investigation or proceeding arising        
after the date hereof shall be deemed to have any adverse effect if and to      
the extent such actions, suits, claims, hearings, investigations or             
proceedings are based on this Agreement or the transactions contemplated        
hereby.                                                                         

(h) Employee Benefits.                  

              (i)     A copy of each bonus, deferred
compensation, pension, retirement, profit-sharing, thrift, savings,             
employee stock ownership, stock bonus, stock purchase, restricted stock,        
stock option, employment, termination, severance, compensation, medical,        
health or other plan, agreement, policy or arrangement that covers              
employees, directors, former employees or former directors of the Company       
and its Subsidiaries (the "Company Compensation and Benefit Plans") and any     
trust agreements or insurance contracts forming a part of such Company          
Compensation and Benefit Plans has been made available by the Company to        
SBC prior to the date hereof and each such Company Compensation and Benefit     
Plan is listed in Section 5.1(h) of the Company Disclosure Letter.              

          (ii)     In the case of the Company,
each of the Company Compensation and Benefit Plans or, in the case of SBC,      
each bonus, deferred compensation, pension, retirement, profit-sharing,         
thrift, savings, employee stock ownership, stock bonus, stock purchase,         
restricted stock, stock option, employment, termination, severance,             
compensation, medical, health or other plan, agreement, policy or               
arrangement that covers employees, directors, former employees or former        
directors of SBC and SBC's Subsidiaries (together with the Company              
Compensation and Benefit Plans, its "Compensation and Benefit Plans") is in     
substantial compliance with all applicable law, including the Code and the      
Employee Retirement Income Security Act of 1974, as amended ("ERISA"). Each     
of its Compensation and Benefit Plans that is an "employee pension benefit      
plan" within the meaning of Section 3(2) of ERISA (a "Pension Plan") and        
that is intended to be qualified under Section 401(a) of the Code has           
received a favorable determination letter from the Internal Revenue Service     
(the "IRS") with respect to "TRA" (as such term is defined in Section 1 of      
Rev. Proc 9339), and it is not aware of any circumstances likely to result      
in revocation of any such favorable determination letter. There is no           
pending or, to the actual knowledge of its executive officers, threatened       
in writing material litigation relating to its Compensation and Benefit         
Plans. Neither it nor any Subsidiary has engaged in a transaction with          
respect to any of its Compensation and Benefit Plans that, assuming the         
taxable period of such transaction expired as of the date hereof, would         
subject it or any of its Subsidiaries to a material tax or penalty imposed      
by either Section 4975 of the Code or Section 502 of ERISA.                     

       (iii)     As of the date hereof, no
liability under Subtitle C or D of Title IV of ERISA (other than the            
payment of prospective premium amounts to the Pension Benefit Guaranty          
Corporation in the normal course) has been or is expected to be incurred by     
it or any Subsidiary with respect to any ongoing, frozen or terminated          
"single-employer plan", within the meaning of Section 4001(a)(15) of ERISA,     
currently or formerly maintained by any of them, or the single-employer         
plan of any entity which is considered one employer with it under Section       
4001 of ERISA or Section 414 of the Code (its "ERISA Affiliate") (each such     
single-employer plan, its "ERISA Affiliate Plan"). It and its Subsidiaries      
and ERISA Affiliates have not contributed, or been obligated to contribute,     
to a multiemployer plan under Subtitle E of Title IV of ERISA at any time       
since September 26, 1980. No notice of a "reportable event", within the         
meaning of Section 4043 of ERISA for which the 30-day reporting requirement     
has not been waived, has been required to be filed for any of its Pension       
Plans or any of its ERISA Affiliate Plans within the 12-month period ending     
on the date hereof or will be required to be filed in connection with the       
transactions contemplated by this Agreement.                                    

            (iv)     All contributions required to
be made under the terms of any of its Compensation and Benefit Plans as of      
the date hereof have been timely made or have been reflected on the most        
recent consolidated balance sheet filed or incorporated by reference in its     
Reports prior to the date hereof. Neither any of its Pension Plans nor any      
of any of its ERISA Affiliate Plans has an "accumulated funding deficiency"     
(whether or not waived) within the meaning of Section 412 of the Code or        
Section 302 of ERISA. Neither it nor its Subsidiaries has provided, or is       
required to provide, security to any of its Pension Plans or to any of its      
ERISA Affiliate Plans pursuant to Section 401(a)(29) of the Code.               

         (v)     Under each of its Pension
Plans which is a single-employer plan and each of its ERISA Affiliate           
Plans, as of the last day of the most recent plan year ended prior to the       
date hereof, the actuarially determined present value of all "benefit           
liabilities", within the meaning of Section 4001(a)(16) of ERISA (as            
determined on the basis of the actuarial assumptions contained in such          
Pension Plan's or ERISA Affiliate Plan's most recent actuarial valuation),      
did not exceed the then current value of the assets of such Pension Plan or     
ERISA Affiliate Plan, and there has been no material change in the              
financial condition of such Pension Plan or ERISA Affiliate Plan since the      
last day of the most recent plan year.                                          

                       (vi)     Neither it nor its Subsidiaries have any
obligations for retiree health and life benefits under any of its Compensatio   
and Benefit Plans, except as set forth in its Reports filed prior to the        
date hereof or as required by applicable law.                                   

                      (vii) None of the consummation of the Merger and
the other transactions contemplated by this Agreement, in the case of SBC       
and the Company, the adoption of this Agreement by the stockholders of the      
Company, in the case of the Company, the approval by the stockholders of        
SBC of the issuance of the shares of SBC Common Stock required to be issued     
pursuant to Article IV, in the case of SBC, shall (x) entitle any of their      
respective employees or directors or any employees of their respective          
Subsidiaries to severance pay, directly or indirectly, upon termination of      
employment, (y) accelerate the time of funding (whether through a grantor       
trust or otherwise), payment or vesting or trigger any payment of               
compensation or benefits under, increase the amount payable or trigger any      
other material obligation pursuant to, any of their respective Compensation     
and Benefit Plans or (z) result in any breach or violation of, or a default     
under, any of their respective Compensation and Benefit Plans.                  

            (i) Compliance with Laws. Except as set forth in its
Reports filed prior to the date hereof, the businesses of each of it and        
its Subsidiaries have not been, and are not being, conducted in violation       
of any law, statute, ordinance, regulation, judgment, order, decree,            
injunction, arbitration award, license, authorization, opinion, agency          
requirement or permit of any Governmental Entity or common law                  
(collectively, "Laws"), except for violations or possible violations that       
are not, individually or in the aggregate, reasonably likely to have a          
Material Adverse Effect on it or prevent, materially delay or materially        
impair its ability to consummate the transactions contemplated by this          
Agreement. Except as set forth in its Reports filed prior to the date           
hereof, no investigation or review by any Governmental Entity with respect      
to it or any of its Subsidiaries is pending or, to the actual knowledge of      
its executive officers, threatened, nor has any Governmental Entity             
indicated an intention to conduct the same, except for those the outcome of     
which are not, individually or in the aggregate, reasonably likely to have      
a Material Adverse Effect on it or prevent, materially delay or materially      
impair its ability to consummate the transactions contemplated by this          
Agreement. To the actual knowledge of its executive officers, no material       
change is required in its or any of its Subsidiaries' processes, properties     
or procedures in connection with any such Laws, and it has not received any     
notice or communication of any material noncompliance with any such Laws        
that has not been cured as of the date hereof, except for such changes and      
noncompliance that are not, individually or in the aggregate, reasonably        
likely to have a Material Adverse Effect on it or prevent, materially delay     
or materially impair its ability to consummate the transactions                 
contemplated by this Agreement. Each of it and its Subsidiaries has all         
permits, licenses, franchises, variances, exemptions, orders and other          
governmental authorizations, consents and approvals (collectively,              
"Permits"), necessary to conduct their business as presently conducted,         
except for those the absence of which are not, individually or in the           
aggregate, reasonably likely to have a Material Adverse Effect on it or         
prevent, materially delay or materially impair its ability to consummate        
the transactions contemplated by this Agreement.                                

            (j) Takeover Statutes. The Board of Directors of the
Company has taken all appropriate and necessary actions such that SBC will      
not be prohibited from entering into a "business combination" with the          
Company as an "interested stockholder" (in each case as such term is used       
in Section 203 of the DGCL) as a result of the execution and delivery of        
this Agreement or the consummation of the transactions contemplated hereby.     
To the best knowledge of the Company, no other "fair price," "moratorium,"      
"control share acquisition" or other similar anti-takeover statute or           
regulation (each a "Takeover Statute") as in effect on the date hereof is       
applicable to the Company, the Company Shares, the Merger or the other          
transactions contemplated by this Agreement. No antitakeover provision          
contained in the Company's certifi cate of incorporation, including Article     
Ninth thereof, or its by-laws is, or at the Effective Time will be,             
applicable to the Company, the Company Shares, the Merger or the other          
transactions contemplated by this Agreement.                                    

             (k) Environmental Matters. Except as disclosed in its
Reports filed prior to the date hereof and except for such matters that,        
alone or in the aggregate, are not reasonably likely to have a Material         
Adverse Effect on it: (i) each of it and its Subsidiaries has complied with     
all applicable Environmental Laws (as defined below); (ii) the properties       
currently owned or operated by it or any of its Subsidiaries (including         
soils, groundwater, surface water, buildings or other structures) are not       
contaminated with any Hazardous Substances (as defined below); (iii) the        
properties formerly owned or operated by it or any of its Subsidiaries were     
not contaminated with Hazardous Substances during the period of ownership       
or operation by it or any of its Subsidiaries; (iv) neither it nor any of       
its Subsidiaries is subject to liability for any Hazardous Substance            
disposal or contamination on any third party property; (v) neither it nor       
any Subsidiary has been associated with any release or threat of release of     
any Hazardous Substance; (vi) neither it nor any Subsidiary has received        
any notice, demand, letter, claim or request for information alleging that      
it or any of its Subsidiaries may be in violation of or liable under any        
Environmental Law (including any claims relating to electromagnetic fields      
or microwave transmissions); (vii) neither it nor any of its Subsidiaries       
is subject to any orders, decrees, injunctions or other arrangements with       
any Governmental Entity or is subject to any indemnity or other agreement       
with any third party relating to liability under any Environmental Law or       
relating to Hazardous Substances; and (viii) there are no circumstances or      
conditions involving it or any of its Subsidiaries that could reasonably be     
expected to result in any claims, liability, investigations, costs or           
restrictions on the ownership, use, or transfer of any of its properties        
pursuant to any Environmental Law.                                              

  As used herein, the term "Environmental Law" means any Law
relating to: (A) the protection, investigation or restoration of the            
environment, health, safety, or natural resources, (B) the handling, use,       
presence, disposal, release or threatened release of any Hazardous              
Substance or (C) noise, odor, wetlands, pollution, contamination or any         
injury or threat of injury to persons or property in connection with any        
Hazardous Substance.                                                            

As used herein, the term "Hazardous Substance" means any
substance that is: listed, classified or regulated pursuant to any              
Environmental Law, including any petroleum product or by-product,               
asbestos-containing material, lead-containing paint or plumbing,                
polychlorinated biphenyls, radioactive materials or radon.                      

              (l) Accounting and Tax Matters. As of the date hereof,
neither it nor any of its affiliates (as determined in accordance with          
Section 6.7) has taken or agreed to take any action, nor do its executive       
officers have any actual knowledge of any fact or circumstance, that, to        
their actual knowledge, would prevent SBC from accounting for the business      
combination to be effected by the Merger as a "pooling-ofinterests" or          
prevent the Merger and the other transactions contemplated by this              
Agreement from qualifying as a "reorganization" within the meaning of           
Section 368(a) of the Code.                                                     

       (m) Taxes. It and each of its Subsidiaries have
prepared in good faith and duly and timely filed (taking into account any       
extension of time within which to file) all material Tax Returns (as            
defined below) required to be filed by any of them and all such filed tax       
returns are complete and accurate in all material respects and: (i) it and      
each of its Subsidiaries have paid all Taxes (as defined below) that are        
shown as due on such filed Tax Returns or that it or any of its                 
Subsidiaries is obligated to withhold from amounts owing to any employee,       
creditor or third party, except with respect to matters contested in good       
faith or for such amounts that, alone or in the aggregate, are not              
reasonably likely to have a Material Adverse Effect on it; (ii) as of the       
date hereof, there are not pending or, to the actual knowledge of its           
executive officers threatened in writing, any audits, examinations,             
investigations or other proceedings in respect of Taxes or Tax matters; and     
(iii) there are not, to the actual knowledge of its executive officers, any     
unresolved questions or claims concerning its or any of its Subsidiaries'       
Tax liability that are reasonably likely to have a Material Adverse Effect      
on it. Neither it nor any of its Subsidiaries has any liability with            
respect to income, franchise or similar Taxes in excess of the amounts          
accrued in respect thereof that are reflected in the financial statements       
included in its Reports, except such excess liabilities as are not,             
individually or in the aggregate, reasonably likely to have a Material          
Adverse Effect on it. No payments to be made to any of the officers and         
employees of it or its Subsidiaries will as a result of consummation of the     
Merger be subject to the deduction limitations under Section 280G of the        
Code.                                                                           

     As used in this Agreement, (i) the term "Tax"
(including, with correlative meaning, the terms "Taxes", and "Taxable")         
includes all federal, state, local and foreign income, profits, franchise,      
gross receipts, environmental, customs duty, capital stock, severance,          
stamp, payroll, sales, employment, unemployment, disability, use, property,     
withholding, excise, production, value added, occupancy and other taxes,        
duties or assessments of any nature whatsoever, together with all interest,     
penalties and additions imposed with respect to such amounts and any            
interest in respect of such penalties and additions, and (ii) the term "Tax     
Return" includes all returns and reports (including elections,                  
declarations, disclosures, schedules, estimates and information returns)        
required to be supplied to a Tax authority relating to Taxes.                   

    (n) Labor Matters. Neither it nor any of its
Subsidiaries is the subject of any material proceeding asserting that it or     
any of its Subsidiaries has committed an unfair labor practice or is            
seeking to compel it to bargain with any labor union or labor organization      
nor is there pending or, to the actual knowledge of its executive officers,     
threatened in writing, nor has there been for the past five years, any          
labor strike, dispute, walkout, work stoppage, slow-down or lockout             
involving it or any of its Subsidiaries, except in each case as is not,         
individually or in the aggregate, reasonably likely to have a Material          
Adverse Effect on it.                                                           

            (o) Rights Agreement. (i) The Company has adopted an
amendment to the Rights Agreement (the "Rights Amendment") with the effect      
that neither SBC nor Merger Sub shall be deemed to be an Acquiring Person       
(as such term is defined in the Rights Agreement) and the Distribution Date     
(as defined in the Rights Agreement) shall not be deemed to occur and that      
the Rights will not separate from the Company Shares, as a result of            
entering into this Agreement or consummating the Merger and/or the other        
transactions contemplated hereby.                                               

        (ii)     The Company has taken all
necessary action with respect to all of the outstanding Rights (as defined      
in the Rights Agreement) so that, as of immediately prior to the Effective      
Time, as a result of entering into this Agreement or consummating the           
Merger and/or the other transactions contemplated by this Agreement, (A)        
neither the Company nor SBC will have any obligations under the Rights or       
the Rights Agreement and (B) the holders of the Rights will have no rights      
under the Rights or the Rights Agreement.                                       

          (p) Brokers and Finders. Neither it nor any of its
officers, directors or employees has employed any broker or finder or           
incurred any liability for any brokerage fees, commissions or finders, fees     
in connection with the Merger or the other transactions contemplated in         
this Agreement except that (i) the Company has employed Goldman, Sachs &        
Co. as its financial advisor, the arrangements with which have been             
disclosed to SBC prior to the date hereof, and (ii) SBC and Merger Sub have     
employed Salomon Brothers Inc and Smith Barney Inc. as their financial          
advisor, the arrangements with which have been disclosed to the Company         
prior to the date hereof.                                                       

ARTICLE VI    

Covenants     

     6.1. Interim Operations. (a) The Company covenants and agrees
as to itself and its Subsidiaries that, after the date hereof and prior to      
the Effective Time (unless SBC shall otherwise approve in writing, which        
approval shall not be unreasonably withheld or delayed, and except as           
otherwise expressly contemplated by this Agreement, disclosed in the            
Company Disclosure Letter or required by applicable Law):                       

          (i)     the business of it and its
Subsidiaries shall be conducted in the ordinary and usual course and, to        
the extent consistent therewith, it and its Subsidiaries shall use all          
reasonable best efforts to preserve its business organization intact and        
maintain its existing relations and goodwill with customers, suppliers,         
regulators, distributors, creditors, lessors, employees and business            
associates;                                                                     

      (ii) it shall not (A) amend its certificate of
incorporation or by-laws or amend, modify or terminate the Rights               
Agreement; provided, however, that nothing in this Agreement shall prevent      
the Company from reducing below 20% the beneficial ownership threshold in       
the definition of an Acquiring Person (as defined in the Rights Agreement)      
or extending the Final Expiration Date of the Rights Agreement (as defined      
therein) or adopting a new rights agreement having substantially similar        
terms as the Rights Agreement and not inconsistent with (x) this proviso,       
(y)Section 5.1(o) (assuming references therein are to such a new rights         
agreement) or (z) the transactions contemplated by this Agreement; (B)          
split, combine, subdivide or reclassify its outstanding shares of capital       
stock; (C) declare, set aside or pay any dividend or distribution payable       
in cash, stock or property in respect of any capital stock, other than          
regular quarterly cash dividends in amounts consistent with its past            
practice or rights to purchase Company Shares or Company Preference Shares      
pursuant to any successor agreement to the Rights Agreement, adopted in         
accordance with the terms of this Agreement; or (D) repurchase, redeem or       
otherwise acquire or permit any of its Subsidiaries to purchase or              
otherwise acquire, except in open market transactions in connection with        
the Company Stock Plans, any shares of its capital stock or any securities      
convertible into or exchangeable or exercisable for any shares of its           
capital stock, but subject to the Company's obligations under subparagraph      
(iii) below.                                                                    

       (iii)     neither it nor any of its
Subsidiaries shall knowingly take any action that would prevent the Merger      
from qualifying for "pooling of interests" accounting treatment or as a         
"reorganization" within the meaning of Section 368(a) of the Code or that       
would cause any of its representations and warranties herein to become          
untrue in any material respect;                                                 

        (iv)     neither it nor any of its
Subsidiaries shall terminate, establish, adopt, enter into, make any new        
grants or awards of stock-based compensation or other benefits under, amend     
or otherwise modify, any Company Compensation and Benefit Plans or increase     
the salary, wage, bonus or other compensation of any directors, officers or     
key employees except (A) for grants or awards to directors, officers and        
employees of it or its Subsidiaries under existing Company Compensation and     
Benefit Plans in such amounts and on such terms as are consistent with past     
practice, (B) in the normal and usual course of business (which shall           
include normal periodic performance reviews and related Company                 
Compensation and Benefit Plan increases and the provision of individual         
Company Compensation and Benefit Plans consistent with past practice for        
promoted or newly hired officers and employees and the adoption of Company      
Compensation and Benefit Plans for employees of new Subsidiaries in amounts     
and on terms consistent with past practice); provided, that in no event         
shall it institute a broad based change in compensation, unless it shall        
have used its reasonable best efforts to provide SBC with prior notice of       
any such change or, if the Company was unable to provide such prior notice,     
the Company shall provide SBC with notice as soon as practicable following      
any such change, or (C) for actions necessary to satisfy existing               
contractual obligations under Company Compensation and Benefit Plans            
existing as of the date hereof;                                                 

         (v)     neither it nor any of its
Subsidiaries shall issue any Company Preferred Shares or Company Preference     
Shares or incur any indebtedness for borrowed money or guarantee any such       
indebtedness if it should reasonably anticipate that after such incurrence      
any of its or any of its Subsidiaries' outstanding senior indebtedness          
would be rated A or lower by Standard & Poor's;                                 

        (vi)     neither it nor any of its
Subsidiaries shall make any capital expenditures in any period of twelve        
consecutive months following the date hereof in an aggregate amount in          
excess of 150% of the aggregate amount reflected in the Company's capital       
expenditure budget for such year, a copy of which has been provided to SBC;     

       (vii)     neither it nor any of its
Subsidiaries shall transfer, lease, license, sell, mortgage, pledge,            
encumber or otherwise dispose of any of its or its Subsidiaries property or     
assets (including capital stock of any of its Subsidiaries) with a fair         
market value in excess of $1 billion in the aggregate in any period of          
twelve consecutive months following the date hereof except for transfers,       
leases, licenses, sales, mortgages, pledges, encumbrances, or other             
dispositions in the ordinary course of business consistent with past            
practice;                                                                       

      (viii)     neither it nor any of its
Subsidiaries shall issue, deliver, sell, or encumber shares of any class of     
its common stock or any securities convertible into, or any rights,             
warrants or options to acquire, any such shares except, (A) any such shares     
issued pursuant to options and other awards outstanding on the date hereof      
under the Company Stock Plans, awards of options and other awards granted       
hereafter under the Company Stock Plans in accordance with this Agreement       
and shares issuable pursuant to such awards, and (B) up to an aggregate         
amount of $3.6 billion of such shares, securities, rights, warrants or          
options (valued at their fair market value as of the date of the agreement      
to make such acquisition) in any period of twelve consecutive months            
following the date hereof to fund, in whole or in part, the cost of any         
acquisition or acquisitions permitted under clause (ix) below following         
reasonable notice to SBC of its intention to take such action;                  

         (ix)      neither it nor any of its
Subsidiaries shall spend in excess of $3.6 billion in the aggregate in any      
period of twelve consecutive months following the date hereof to acquire        
any business, whether by merger, consolidation, purchase of property or         
assets or otherwise (valuing any non-cash consideration at its fair market      
value as of the date of the agreement for such acquisition); provided, that     
no such acquisition would prevent, materially delay or materially impair        
its ability to consummate the transactions contemplated by this Agreement.      
Notwithstanding the foregoing, neither it nor any of its Subsidiaries shall     
acquire any business the acquisition of which would subject SBC and its         
Subsidiaries following the consummation of the Merger to any Commercial         
Mobile Radio Service spectrum aggregation limit restriction pursuant to the     
provisions of 47 C.F.R. Section 20.6 or place SBC and its Subsidiaries          
following the consummation of the Merger in violation of the Cellular Cross     
Ownership limits contained in 47 C.F.R. Section 22.942. For purposes of         
this clause (ix), the amount spent with respect to any acquisition shall be     
deemed to include the aggregate amount of capital expenditures that the         
Company is obligated to make at any time or plans to make as a result of        
such acquisition within two years after the date of acquisition;                

                     (x) neither it nor its Subsidiaries shall enter
into any business other than the telecommunications business and those          
businesses traditionally associated with the telecommunications business;       
and                                                                             

                     (xi)     neither it nor any of its Subsidiaries
shall authorize or enter into any agreement to do any of the foregoing.         

         (b) SBC covenants and agrees as to itself and its
Subsidiaries that after the date hereof and prior to the Effective Time         
(unless the Company shall otherwise approve in writing, which approval          
shall not be unreasonably withheld or delayed, and except as otherwise          
expressly contemplated by this Agreement, disclosed in the SBC Disclosure       
Letter or required by applicable Law):                                          

                       (i) the business of it and its Subsidiaries shall
be conducted in the ordinary and usual course and, to the extent consistent     
therewith, it and its Subsidiaries shall use all reasonable best efforts to     
preserve its business organization intact and maintain its existing             
relations and goodwill with customers, suppliers, regulators, distributors,     
creditors, lessors, employees and business associates;                          

         (ii)     it shall not (A) amend its
certificate of incorporation or bylaws in any manner that would prohibit or     
hinder, impede or delay in any material respect the Merger or the               
consummation of the transactions contemplated hereby, provided that any         
amendment to its certificate of incorporation to increase the authorized        
number of shares of any class or series of the capital stock of SBC shall       
in no way be restricted by the foregoing; (B) declare, set aside or pay any     
dividend or other distribution payable in cash or property (other than SBC      
Common Stock or rights to purchase SBC Common Stock or SBC Preferred Stock      
pursuant to any successor agreement to the SBC Rights Agreement) in respect     
of any capital stock, other than per share regular quarterly cash dividends     
in amounts consistent with its past practice; or (C) repurchase, redeem or      
otherwise acquire, or permit any of its Subsidiaries to purchase or             
otherwise acquire, except in open market transactions in connection with        
the SBC Stock Plans, any shares of its capital stock or any securities          
convertible into or exchangeable for any shares of its capital stock, but       
subject to SBC's obligations under subparagraph (iii) below;                    

       (iii)     neither it nor any of its
Subsidiaries shall knowingly take any action that would prevent the Merger      
from qualifying for "poolingof interests" accounting treatment or as a          
taxfree "reorganization" within the meaning of Section 368(a) of the Code       
or that would cause any of its representations and warranties herein to         
become untrue in any material respect;                                          

        (iv)     neither it nor any of its
Subsidiaries shall issue any SBC Preferred Shares or incur any indebtedness     
for borrowed money or guarantee any such indebtedness if it should              
reasonably anticipate that after such incurrence any of its or any of its       
Subsidiaries' outstanding senior indebtedness would be rated A or lower by      
Standard & Poor's;                                                              

                      (v) neither it nor any of its Subsidiaries shall
make any capital expenditures in any period of twelve consecutive months        
following the date hereof in an aggregate amount in excess of 150% of the       
aggregate amount of capital expenditures reflected in its capital               
expenditure budget for such year, a copy of which has been provided to the      
Company;                                                                        

        (vi)     neither it nor any of its
Subsidiaries shall transfer, lease, license, sell, mortgage, pledge,            
encumber or otherwise dispose of any of its or its Subsidiaries property or     
assets (including capital stock of any of its Subsidiaries) with a fair         
market value in excess of $1.5 billion in the aggregate in any period of        
twelve consecutive months following the date hereof except for transfers,       
leases, licenses, sales, mortgages, pledges, encumbrances, or other             
dispositions in the ordinary course of business consistent with past            
practice;                                                                       

       (vii)     neither it nor any of its
Subsidiaries shall issue, deliver, sell or encumber shares of any class of      
its common stock or any securities convertible into, or any rights,             
warrants or options to acquire, any such shares, except (A) any such shares     
issued pursuant to options and other awards outstanding on the date hereof      
under the SBC Stock Plans, awards of options and other awards granted           
hereafter under the SBC Stock Plans and shares issuable pursuant to such        
awards, (B) up to an aggregate amount of $4.8 billion of such shares,           
securities, rights, warrants or options (valued at their fair market value      
as of the date of the agreement to make such acquisition) in any period of      
twelve consecutive months following the date hereof to fund, in whole or in     
part, the cost of any acquisition or acquisitions permitted under clause        
(viii) below, following reasonable notice to the Company of its intention       
to take such action, and (C) pursuant to the terms of the Agreement and         
Plan of Merger dated as of January 4, 1998, by and among Southern New           
England Telecommunications Corporation ("SNET"), SBC and SBC(CT) Sub, Inc.      
a Connecticut corporation and a whollyowned subsidiary of SBC (the "SNET        
Agreement"), which issuances of SBC capital stock shall not be included in      
calculating the $4.8 billion of permissible issuances, deliveries, sales or     
encumbrances, or require notice to the Company, pursuant to clause (B)          
above;                                                                          

                   (viii) neither it nor any of its Subsidiaries
shall spend in excess of $4.8 billion in the aggregate in any period of         
twelve consecutive months following the date hereof to acquire any              
business, whether by merger, consolidation, purchase of property or assets      
or otherwise (valuing any noncash consideration at its fair market value as     
of the date of the agreement for such acquisition); provided, however, that     
no such acquisition would prevent, materially delay or materially impair        
its ability to consummate the transactions contemplated by this Agreement;      
provided, further, that the SNET Agreement and the transactions                 
contemplated thereby shall not be subject to the terms of the foregoing         
restriction. Notwithstanding the foregoing, neither it nor any of its           
Subsidiaries shall acquire any business the acquisition of which would          
subject SBC and its Subsidiaries following the consummation of the Merger       
to any Commercial Mobile Radio Service spectrum aggregation limit               
restriction pursuant to the provisions of 47 C.F.R. Section 20.6 or place       
SBC and its Subsidiaries following the consummation of the Merger in            
violation of the Cellular Cross Ownership limits contained in 47 C.F.R.         
Section 22.942; provided, that, the SNET Agreement and the transactions         
contemplated thereby shall not be subject to the terms of the foregoing         
restriction. For purposes of this clause (viii), the amount spent with          
respect to any acquisition shall be deemed to include the aggregate amount      
of capital expenditures that the Company is obligated to make at any time       
or plans to make as a result of such acquisition within two years after the     
date of acquisition;                                                            

                 (ix) neither it nor any of its Subsidiaries
shall enter any business other than the telecommunications business and         
those businesses traditionally associated with the telecommunications           
business; and                                                                   

                      (x) neither it nor any of its Subsidiaries shall
authorize or enter into an agreement to do any of the foregoing.                

               (c) SBC and the Company agree that any written approval
obtained under this Section 6.1 may be relied upon by the other party if        
signed by the Chief Executive Officer or another executive officer of the       
other party.                                                                    

       6.2. Acquisition Proposals. (a) The Company agrees that neither
it nor any of its Subsidiaries shall, and that it shall direct and use its      
best efforts to cause its and its Subsidiaries' employees, agents and           
representatives (including any investment banker, attorney or accountant        
retained by it or any of its Subsidiaries) (the Company, its Subsidiaries       
and their officers, directors, employees, agents and representatives being      
the "Company Representatives") not to, directly or indirectly, initiate,        
solicit, encourage or otherwise facilitate any inquiries or the making of       
any proposal or offer with respect to a merger, reorganization, share           
exchange, consolidation or similar transaction involving, or any purchase       
of, or tender offer for, any of the assets of it or any of its Subsidiaries     
or its voting securities if, as a result of such transaction, (i) the           
stockholders of the Company would not hold more than 50% of the voting          
securities of the surviving corporation or its ultimate parent, (ii) the        
directors of the Company would not constitute a majority of the board of        
directors of the surviving corporation or its ultimate parent, or (iii)         
another Person would acquire more than 50% of the assets of the Company and     
its Subsidiaries (any such proposal or offer being hereinafter referred to      
as a "Company Acquisition Proposal"). The Company further agrees that           
neither it nor any of its Subsidiaries shall, and that it shall direct and      
use its best efforts to cause the Company Representatives not to, directly      
or indirectly, have any discussion with or provide any confidential             
information or data to any Person relating to a Company Acquisition             
Proposal or engage in any negotiations concerning a Company Acquisition         
Proposal, or otherwise facilitate any effort or attempt to make or              
implement a Company Acquisition Proposal; provided, however, that nothing       
contained in this Agreement shall prevent either the Company or the Company     
Representatives from (A) complying with Rule 14e-2 promulgated under the        
Exchange Act with regard to a Company Acquisition Proposal; (B) engaging in     
any discussions or negotiations with or providing any information to, any       
Person in response to an unsolicited bona fide written Company Acquisition      
Proposal by any such Person; or (C) recommending such an unsolicited bona       
fide written Company Acquisition Proposal to the stockholders of the            
Company if and only to the extent that, in such case referred to in clause      
(B) or (C), (i) the Board of Directors of the Company concludes in good         
faith (after consultation with its financial advisor) that such Company         
Acquisition Proposal is reasonably capable of being completed, taking into      
account all legal, financial, regulatory and other aspects of the proposal      
and the Person making the proposal, and would, if consummated, result in a      
transaction more favorable to the Company's stockholders from a financial       
point of view than the transaction contemplated by this Agreement (any such     
more favorable Company Acquisition Proposal being referred to in this           
Agreement as a "Superior Company Proposal"), (ii) the Board of Directors of     
the Company determines in good faith after consultation with outside legal      
counsel that such action is necessary for the Board of Directors to comply      
with its fiduciary duty under applicable law and (iii) prior to providing       
any information or data to any Person in connection with a Company              
Acquisition Proposal by any such Person, the Board of Directors of the          
Company shall receive from such Person a confidentiality agreement in           
customary form; provided, that such confidentiality agreement shall not         
contain terms that prevent the Company from complying with its obligations      
under this Section 6.2.                                                         

     (b) SBC agrees that neither it nor any of its
Subsidiaries shall, and that it shall direct and use its best efforts to        
cause its and its Subsidiaries' employees, agents and representatives           
(including any investment banker, attorney or accountant retained by it or      
any of its Subsidiaries) (SBC, its Subsidiaries and their officers,             
directors, employees, agents and representatives being the "SBC                 
Representatives") not to, directly or indirectly, initiate, solicit,            
encourage or otherwise facilitate any inquiries or the making of any            
proposal or offer with respect to a merger, reorganization, share exchange,     
consolidation or similar transaction involving, or any purchase of, or          
tender offer for, all or any assets of it or any of its Subsidiaries or its     
voting securities if, as a result of such transaction, (i) the stockholders     
of SBC would not hold more than 50% of the voting securities of the             
surviving corporation or its ultimate parent, (ii) the directors of SBC         
would not constitute a majority of the board of directors of the surviving      
corporation or its ultimate parent, or (iii) another Person would acquire       
more than 50% of the assets of SBC and its Subsidiaries (any such proposal      
or offer being hereinafter referred to as a "SBC Acquisition Proposal").        
SBC further agrees that neither it nor any of its Subsidiaries nor any of       
the officers and directors of it or its Subsidiaries shall, and that it         
shall direct and use its best efforts to cause the SBC Representatives not      
to, directly or indirectly, have any discussion with or provide any             
confidential information or data to any Person relating to a SBC                
Acquisition Proposal or engage in any negotiations concerning a SBC             
Acquisition Proposal, or otherwise facilitate any effort or attempt to make     
or implement a SBC Acquisition Proposal; provided, however, that nothing        
contained in this Agreement shall prevent either SBC or the SBC                 
Representatives from (A) complying with Rule 14e-2 promulgated under the        
Exchange Act with regard to a SBC Acquisition Proposal; (B) engaging in any     
discussions or negotiations with or providing any information to, any           
Person in response to an unsolicited bona fide written SBC Acquisition          
Proposal by any such Person; or (C) recommending such an unsolicited bona       
fide written SBC Acquisition Proposal to the stockholders of SBC if and         
only to the extent that, in such cases referred to in clause (B) or (C),        
(i) the Board of Directors of SBC concludes in good faith (after                
consultation with its financial advisor) that such SBC Acquisition Proposal     
is reasonably capable of being completed, taking into account all legal,        
financial, regulatory and other aspects of the proposal and the Person          
making the proposal, and would, if consummated, result in a transaction         
more favorable to SBC or SBC's stockholders from a financial point of view      
than the transaction contemplated by this Agreement (any such more              
favorable SBC Acquisition Proposal being referred to herein as a "Superior      
SBC Proposal"), (ii) the Board of Directors of SBC determines in good faith     
after consultation with outside legal counsel that such action is necessary     
for the Board of Directors to comply with its fiduciary duty under              
applicable law and (iii) prior to providing any information or data to any      
Person in connection with a SBC Acquisition Proposal by any such Person,        
the Board of Directors of SBC shall receive from such Person a                  
confidentiality agreement in customary form; provided, that, such               
confidentiality agreement shall not contain terms that prevent SBC from         
complying with its obligations under this Section 6.2.                          

        (c) The Company and SBC each agrees that it will
immediately cease and cause to be terminated any existing activities,           
discussions or negotiations with any parties conducted heretofore with          
respect to any Company Acquisition Proposal or SBC Acquisition Proposal, as     
the case may be. The Company and SBC each agrees that it will take the          
necessary steps to promptly inform the individuals or entities referred to      
in the first sentence of paragraphs (a) and (b), respectively, of the           
obligations undertaken in Section 6.2(a) or (b), as the case may be. The        
Company and SBC each agrees that it will notify the other immediately if        
any such inquiries, proposals or offers are received by, any such               
information is requested from, or any such discussions or negotiations are      
sought to be initiated or continued with, any of its representatives            
indicating, in connection with such notice, the name of such Person and the     
terms and conditions of any proposals or offers, and thereafter shall           
inform the other of any material modification of the terms of any such          
proposal or offer or the withdrawal thereof. The Company and SBC each also      
agrees that it will promptly request each Person that has heretofore            
executed a confidentiality agreement in connection with its consideration       
of any Company Acquisition Proposal or any SBC Acquisition Proposal, as the     
case may be, to return all confidential information heretofore furnished to     
such Person by or on behalf of it or any of its Subsidiaries.                   

      6.3. Information Supplied. The Company and SBC each agrees, as
to itself and its Subsidiaries, that none of the information supplied or to     
be supplied by it or its Subsidiaries for inclusion or incorporation by         
reference in (i) the Registration Statement on Form S-4 to be filed with        
the SEC by SBC in connection with the issuance of shares of SBC Common          
Stock in the Merger (including the joint proxy statement and prospectus         
(the "Prospectus/Proxy Statement") constituting a part thereof) (the "S-4       
Registration Statement") will, at the time the S-4 Registration Statement       
becomes effective under the Securities Act, and (ii) the Prospectus/Proxy       
Statement and any amendment or supplement thereto will, at the date of          
mailing to stockholders and at the times of the meetings of stockholders of     
the Company and SBC to be held in connection with the Merger, in any such       
case, contain any untrue statement of a material fact or omit to state any      
material fact required to be stated therein or necessary in order to make       
the statements therein, in light of the circumstances under which they were     
made, not misleading. If at any time prior to the Effective Time any            
information relating to SBC or the Company, or any of their respective          
affiliates, officers or directors, should be discovered by SBC or the           
Company which should be set forth in an amendment or supplement to either       
the S4 Registration Statement or the Prospectus/Proxy Statement, so that        
any of such documents would not include any misstatement of a material fact     
or omit to state any material fact required to be stated therein or             
necessary to make the statements therein, in the light of the circumstances     
under which they were made, not misleading, the party which discovers such      
information shall promptly notify the other parties hereto and an               
appropriate amendment or supplement describing such information shall be        
promptly filed with the SEC and, to the extent required by law,                 
disseminated to the stockholders of the Company and SBC.                        

6.4. Stockholders Meetings. The Company will take, in   
accordance with applicable law and its certificate of incorporation and         
by-laws, all action necessary to convene a meeting of holders of Company        
Shares (the "Company Stockholders Meeting") as promptly as practicable          
after the S-4 Registration Statement is declared effective to consider and      
vote upon the adoption of this Agreement. SBC will take, in accordance with     
applicable law and its certificate of incorporation and by-laws, all action     
necessary to convene a meeting of holders of the SBC Common Stock (the "SBC     
Stockholders Meeting", and either the SBC Stockholders Meeting or the           
Company Stockholders Meeting, a "Stockholders Meeting") as promptly as          
practicable after the S-4 Registration Statement is declared effective to       
consider and vote upon the approval of the issuance of SBC Common Stock         
required to be issued pursuant to Article IV. Subject to fiduciary              
obligations under applicable law and the terms of this Agreement, the           
Company's Board of Directors shall recommend that the stockholders of the       
Company adopt this Agreement and thereby approve the transactions               
contemplated hereby and shall take all lawful action to solicit such            
adoption, and SBC's Board of Directors shall recommend that the                 
stockholders of SBC approve the issuance of SBC Common Stock required to be     
issued pursuant to Article IV and shall take all lawful action to solicit       
such approval.                                                                  

  6.5. Filings; Other Actions; Notification. (a) SBC and the
Company shall promptly prepare and file with the SEC the Prospectus/Proxy       
Statement, and SBC shall prepare and file with the SEC the S-4 Registration     
Statement as promptly as practicable. SBC and the Company each shall use        
all reasonable best efforts to have the S-4 Registration Statement declared     
effective under the Securities Act as promptly as practicable after such        
filing, and promptly thereafter mail the Prospectus/Proxy Statement to the      
respective stockholders of each of the Company and SBC. SBC shall also use      
all reasonable best efforts to obtain prior to the effective date of the        
S-4 Registration Statement all necessary state securities law or "blue sky"     
permits and approvals required in connection with the Merger and to             
consummate the other transactions contemplated by this Agreement and will       
pay all expenses incident thereto.                                              

             (b) The Company and SBC each shall use all reasonable
best efforts to cause (x) the Merger to qualify for "pooling of interests"      
accounting treatment and (y) to be delivered to the other party and its         
directors a letter of its independent auditors, dated (i) the date on which     
the S-4 Registration Statement shall become effective and (ii) the Closing      
Date, and addressed to the other party and its directors, in form and           
substance customary for "comfort" letters delivered by independent public       
accountants in connection with registration statements similar to the S-4       
Registration Statement.                                                         

               (c) The Company and SBC shall cooperate with each other
and use (and shall cause their respective Subsidiaries to use) all their        
respective reasonable best efforts to take or cause to be taken all             
actions, and do or cause to be done all things, necessary, proper or            
advisable on its part under this Agreement and applicable Laws to               
consummate and make effective the Merger and the other transactions             
contemplated by this Agreement as soon as practicable, including preparing      
and filing as promptly as practicable all documentation to effect all           
necessary applications, notices, petitions, filings and other documents and     
to obtain as promptly as practicable all consents, registrations,               
approvals, permits and authorizations required to be obtained from any          
third party and/or any Governmental Entity in connection with the execution     
and delivery of this Agreement and the consummation of the Merger and the       
other transactions contemplated hereby; provided, however, that nothing in      
this Section 6.5 shall require, or be construed to require, SBC or the          
Company to agree to, or comply with, any conditions to the granting of any      
such consent, registration, approval, permit or authorization by any            
Governmental Entity if compliance with such conditions, individually or in      
the aggregate, would be reasonably likely to have a Material Adverse Effect     
on the Surviving Corporation or SBC following the Effective Time (it being      
understood that, for this purpose only, materiality shall be determined by      
reference to the trading market equity value of SBC prior to the                
consummation of the Merger and after taking into account (i) any adverse        
effects reasonably likely to arise from any restrictions on the ability of      
the Surviving Corporation or SBC or any of their respective Subsidiaries to     
conduct its operations as currently conducted or as proposed as of the date     
of this Agreement to be conducted resulting from complying with the             
conditions to or from the grant of any such consent, registration,              
approval, permit or authorization, (ii) any benefits reasonably likely to       
be realized by SBC on a consolidated basis (other than those operational        
benefits reasonably likely to be realized directly from the consummation of     
the Merger) resulting from complying with the conditions to or from the         
grant of any such consent, registration, approval, permit or authorization,     
and (iii) any proceeds resulting from any divestiture required by a             
Governmental Entity as a condition to its granting any such consent,            
registration, approval, permit or authorization); provided, further, that       
any divestiture by either SBC or the Company or any of their respective         
Subsidiaries reasonably required to cause the Surviving Corporation to be       
in compliance with the Commercial Mobile Radio Service spectrum aggregation     
limits established by the FCC in 47 C.F.R. Section 20.6 and the Cellular        
Cross Ownership limits contained in 47 C.F.R. Section 22.942 shall be           
deemed not to have any adverse effect on either the Surviving Corporation       
or SBC following the Effective Time (a "Regulatory Material Adverse             
Effect"). Subject to applicable laws relating to the exchange of                
information, SBC and the Company shall have the right to review in advance,     
and to the extent practicable each will consult the other on, all the           
information relating to SBC or the Company, as the case may be, and any of      
their respective Subsidiaries, that appear in any filing made with, or          
written materials submitted to, any third party and/or any Governmental         
Entity in connection with the Merger and the other transactions                 
contemplated by this Agreement. In exercising the foregoing right, each of      
the Company and SBC shall act reasonably and as promptly as practicable.        

               (d) The Company and SBC each shall, upon request by the
other, furnish the other with all information concerning itself, its            
Subsidiaries, directors, officers and stockholders and such other matters       
as may be reasonably necessary or advisable in connection with the              
Prospectus/Proxy Statement, the S-4 Registration Statement or any other         
statement, filing, notice or application made by or on behalf of SBC, the       
Company or any of their respective Subsidiaries to any third party and/or       
any Governmental Entity in connection with the Merger and the transactions      
contemplated by this Agreement.                                                 

         (e) The Company and SBC each shall keep the other
apprised of the status of matters relating to completion of the                 
transactions contemplated hereby, including promptly furnishing the other       
with copies of notice or other communications received by SBC or the            
Company, as the case may be, or any of its Subsidiaries, from any third         
party and/or any Governmental Entity with respect to the Merger and the         
other transactions contemplated by this Agreement. Each of the Company and      
SBC shall give prompt notice to the other of any change that is reasonably      
likely to result in a Material Adverse Effect on it or of any failure of        
any condition to the other party's obligations to effect the Merger set         
forth in Article VII.                                                           

  6.6. Access; Consultation. (a) Upon reasonable notice, and
except as may otherwise be required by applicable law, the Company and SBC      
each shall (and shall cause its Subsidiaries to) afford the SBC                 
Representatives or the Company Representatives, as the case may be,             
reasonable access, during normal business hours throughout the period prior     
to the Effective Time, to its properties, books, contracts and records and,     
during such period, each shall (and shall cause its Subsidiaries to)            
furnish promptly to the other all information concerning its business,          
properties and personnel as may reasonably be requested, provided that no       
investigation pursuant to this Section shall affect or be deemed to modify      
any representation or warranty made by the Company, SBC or Merger Sub           
hereunder, and provided, further, that the foregoing shall not require the      
Company or SBC to permit any inspection, or to disclose any information,        
that in the reasonable judgment of the Company or SBC, as the case may be,      
would result in the disclosure of any trade secrets of third parties or         
violate any of its obligations with respect to confidentiality if the           
Company or SBC, as the case may be, shall have used all reasonable best         
efforts to obtain the consent of such third party to such inspection or         
disclosure. All requests for information made pursuant to this Section          
shall be directed to an executive officer of the Company or SBC, as the         
case may be, or such Person as may be designated by any such executive          
officer, as the case may be.                                                    

               (b) From the date hereof to the Effective Time, SBC and
the Company agree to consult with each other on a regular basis on a            
schedule to be agreed with regard to their respective operations.               

           (c) From the date hereof to the Effective Time, the
Company agrees to notify SBC in advance of any issuance by the Company or       
any of its Subsidiaries of any longterm debt in excess of $50 million,          
Company Preferred Shares or Company Preference Shares.                          

      6.7. Affiliates. (a) Each of the Company and SBC shall deliver
to the other a letter identifying all Persons whom such party believes to       
be, at the date of the Stockholders Meeting of such party, "affiliates" of      
such party for purposes of applicable interpretations regarding use of the      
poolingofinterests accounting method and, in the case of "affiliates" of        
the Company, for purposes of Rule 145 under the Securities Act. Each of the     
Company and SBC shall use all reasonable best efforts to cause each Person      
who is identified as an "affiliate" in the letter referred to above to          
deliver to SBC on or prior to the date of the Stockholders Meeting of such      
party a written agreement, in the form attached hereto as Exhibit A, in the     
case of affiliates of the Company (the "Company Affiliate's Letter"), and       
Exhibit B, in the case of affiliates of SBC (the "SBC Affiliate's Letter").     
Prior to the Effective Time, each of the Company and SBC shall use all          
reasonable best efforts to cause each additional Person who is identified       
as an "affiliate" after the date of the relevant Stockholders Meeting to        
execute the applicable written agreement as set forth in this Section 6.7,      
as soon as practicable after such Person is identified.                         

     (b) If the Merger would otherwise qualify for
poolingofinterests accounting treatment, shares of SBC Common Stock issued      
to such affiliates of the Company in exchange for Company Shares shall not      
be transferable until such time as financial results covering at least 30       
days of combined operations of SBC and the Company shall have been              
published within the meaning of Section 201.01 of the SEC's Codification of     
Financial Reporting Policies, regardless of whether each such affiliate has     
provided the written agreement referred to in this Section, except to the       
extent permitted by, and in accordance with, SEC Accounting Series Release      
135 and SEC Staff Accounting Bulletins 65 and 76. Any Company Shares held       
by any such affiliate shall not be transferable, regardless of whether such     
affiliate has provided the applicable written agreement referred to in this     
Section, if such transfer, either alone or in the aggregate with other          
transfers by affiliates, would preclude SBC's ability to account for the        
business combination to be effected by the Merger as a pooling of               
interests. The Company shall not register the transfer of any Certificate,      
unless such transfer is made in compliance with the foregoing.                  

     6.8. Stock Exchange Listing and De-listing. SBC shall use its
best efforts to cause the shares of SBC Common Stock to be issued in the        
Merger to be approved for listing on the New York Stock Exchange ("NYSE"),      
subject to official notice of issuance, prior to the Closing Date. The          
Surviving Corporation shall use its best efforts to cause the Company           
Shares to be de-listed from the NYSE and the Chicago, Boston, Pacific and       
Philadelphia stock exchanges and de-registered under the Exchange Act as        
soon as practicable following the Effective Time.                               

     6.9. Publicity. The initial press release with respect to the
Merger shall be a joint press release and thereafter the Company and SBC        
shall consult with each other prior to issuing any press releases or            
otherwise making public announcements with respect to the Merger and the        
other transactions contemplated by this Agreement and prior to making any       
filings with any third party and/or any Governmental Entity (including any      
national securities exchange) with respect thereto, except as may be            
required by law or by obligations pursuant to any listing agreement with or     
rules of any national securities exchange.                                      

6.10.   Benefits.                                       

(a) Stock Options.                      

             (i) At the Effective Time, each outstanding option to
purchase Company Shares (a "Company Option") under the Company Stock Plans,     
whether vested or unvested, shall be deemed to constitute an option to          
acquire, on the same terms and conditions as were applicable under such         
Company Option (except to the extent such terms and conditions are altered      
in accordance with their terms as a result of the consummation of the           
transactions contemplated by this Agreement), the same number of shares of      
SBC Common Stock as the holder of such Company Option would have been           
entitled to receive pursuant to the Merger had such holder exercised such       
Company Option in full immediately prior to the Effective Time (rounded         
down to the nearest whole number) (a "Substitute Option"), at an exercise       
price per share (rounded up to the nearest whole cent)(the "Substitute          
Option Price") equal to (y) the aggregate exercise price for the Company        
Shares otherwise purchasable pursuant to such Company Option divided by (z)     
the number of full shares of SBC Common Stock deemed purchasable pursuant       
to such Company Option in accordance with the foregoing. For each               
Substitute Option substituted for a Company Option that included a right        
under certain circumstances to receive dividend equivalents in the form of      
stock units ("Company Stock Units"), all Company Stock Units credited to        
the account of the holder of such Substitute Option at the Effective Time       
shall, as of the Effective Time, be deemed to constitute a number of stock      
units, each of which shall represent one share of SBC Common Stock ("SBC        
Stock Units"), equal to the number of shares of SBC Common Stock the holder     
of such Substitute Option would have been entitled to receive pursuant to       
this Agreement had such Company Stock Units been distributed to such holder     
in full immediately prior to the Effective Time and thereafter SBC Stock        
Units shall continue to be credited to the account of the holder of such        
Substitute Option to the same extent and on the same terms and conditions       
as they would have under the Company Option for which the Substitute Option     
was substituted (except that the record dates and dividend amounts shall be     
the record dates and dividend amounts for SBC Common Stock), and all such       
SBC Stock Units shall be distributed at the same times and in the same          
manner as the Company Stock Units would have been distributed had the           
Substitute Option not been substituted for the Company Option (except that      
the option price used to determine if the SBC Stock Units can be                
distributed shall be the Substitute Option Price). At or prior to the           
Effective Time, the Company shall make all necessary arrangements with          
respect to the Company Stock Plans to permit the assumption of the              
unexercised Company Options by SBC pursuant to this Section and as soon as      
practicable after the Effective Time SBC shall use its best efforts to          
register under the Securities Act on Form S-8 or other appropriate form         
(and use its best efforts to maintain the effectiveness thereof) shares of      
SBC Common Stock issuable pursuant to all Substitute Options.                   

              (ii) Effective at the Effective Time, SBC shall assume
each Company Option in accordance with the terms of the Company Stock Plan      
under which it was issued and the stock option agreement by which it is         
evidenced. As promptly as practicable after the Effective Time, the Company     
shall deliver to the participants in the Stock Plans appropriate notices        
setting forth such participants' rights pursuant to such assumed Company        
Options.                                                                        

             (b) Employee Benefits. SBC agrees that it shall cause
the Surviving Corporation for at least two years after the Effective Time       
to provide or cause to be provided to employees of the Company and its          
Subsidiaries compensation and benefit plans that are no less favorable, in      
the aggregate, than the Company Compensation and Benefit Plans disclosed in     
Section 6.10(b) of the Company Disclosure Letter; provided, however, if         
during this period SBC implements any widespread increase or decrease in        
benefits under compensation and benefit plans or in the cost thereof to         
participants under compensation and benefit plans applicable to employees       
of SBC and its Subsidiaries (other than the Surviving Corporation and its       
Subsidiaries), the Surviving Corporation shall proportionately adjust the       
benefits under the Company's compensation and benefit plans or the cost         
thereof to participants, and provided, further with respect to employees        
who are subject to collective bargaining, all benefits shall be provided        
only in accordance with the applicable collective bargaining agreement. At      
or prior to the Effective Time, the Company shall make all necessary            
arrangements to cause any Company Share units under the Company's               
Compensation and Benefit Plans to be converted into share units with            
respect to SBC Common Stock by multiplying the Company Shares subject to        
such Company Share units by the Exchange Ratio. SBC shall, and shall cause      
the Surviving Corporation to, honor, pursuant to their terms, all employee      
benefit obligations existing at the Closing Date to current and former          
employees under the Company Compensation and Benefit Plans.                     

     6.11. Expenses. Whether or not the Merger is consummated, all
costs and expenses incurred in connection with this Agreement and the           
Merger and the other transactions contemplated by this Agreement shall be       
paid by the party incurring such expense, except that expenses incurred in      
connection with the filing fee for the S-4 Registration Statement and           
printing and mailing the Prospectus/Proxy Statement and the S-4                 
Registration Statement and the filing fee under the HSR Act shall be shared     
equally by SBC and the Company.                                                 

      6.12. Indemnification; Directors' and Officers' Insurance. (a)
From and after the Effective Time, SBC shall, and shall cause the Surviving     
Corporation to, indemnify and hold harmless each present and former             
director and officer of the Company (when acting in such capacity)              
determined as of the Effective Time (the "Indemnified Parties"), against        
any costs or expenses (including reasonable attorneys' fees), judgments,        
fines, losses, claims, damages or liabilities (collectively, "Costs")           
incurred in connection with any claim, action, suit, proceeding or              
investigation, whether civil, criminal, administrative or investigative,        
arising out of or pertaining to matters existing or occurring at or prior       
to the Effective Time, whether asserted or claimed prior to, at or after        
the Effective Time, to the fullest extent permitted under Delaware law (and     
the Surviving Corporation shall also advance expenses as incurred to the        
fullest extent permitted under applicable law, provided the Person to whom      
expenses are advanced provides an undertaking to repay such advances if it      
is ultimately determined that such Person is not entitled to                    
indemnification).                                                               

                  (b) Any Indemnified Party wishing to claim indemnification
under paragraph (a) of this Section 6.12, upon learning of any such claim,      
action, suit, proceeding or investigation, shall promptly notify the            
Surviving Corporation thereof, but the failure to so notify shall not           
relieve the Surviving Corporation of any liability it may have to such          
Indemnified Party if such failure does not materially prejudice the             
Surviving Corporation. In the event of any such claim, action, suit,            
proceeding or investigation (whether arising before or after the Effective      
Time), (i) the Surviving Corporation shall have the right to assume the         
defense thereof and the Surviving Corporation shall not be liable to such       
Indemnified Parties for any legal expenses of other counsel or any other        
expenses subsequently incurred by such Indemnified Parties in connection        
with the defense thereof, except that if the Surviving Corporation elects       
not to assume such defense or counsel for the Indemnified Parties advises       
that there are issues which raise conflicts of interest between the             
Surviving Corporation and the Indemnified Parties, the Indemnified Parties      
may retain counsel satisfactory to them, and the Surviving Corporation          
shall pay all reasonable fees and expenses of such counsel for the              
Indemnified Parties promptly as statements therefor are received; provided,     
however, that the Surviving Corporation shall be obligated pursuant to this     
paragraph (b) to pay for only one firm of counsel for all Indemnified           
Parties in any jurisdiction (unless there is a conflict of interest as          
provided above) (ii) the Indemnified Parties will cooperate in the defense      
of any such matter and (iii) the Surviving Corporation shall not be liable      
for any settlement effected without its prior written consent.                  

             (c) The Surviving Corporation shall maintain a policy
of officers' and directors' liability insurance for acts and omissions          
occurring prior to the Effective Time ("D&O Insurance") with coverage in        
amount and scope at least as favorable as the Company's existing directors'     
and officers' liability insurance coverage for a period of six years after      
the Effective Time; provided, however, if the existing D&O Insurance            
expires, is terminated or cancelled, or if the annual premium therefor is       
increased to an amount in excess of 175% of the last annual premium paid        
prior to the date hereof (the "Current Premium"), in each case during such      
six year period, the Surviving Corporation will use its best efforts to         
obtain D&O Insurance in an amount and scope as great as can be obtained for     
the remainder of such period for a premium not in excess (on an annualized      
basis) of 175% of the Current Premium.                                          

          (d) If SBC or any of its successors or assigns (i)
shall consolidate with or merge into any other corporation or entity and        
shall not be the continuing or surviving corporation or entity of such          
consolidation or merger or (ii) shall transfer all or substantially all of      
its properties and assets to any individual, corporation or other entity,       
then and in each such case, proper provisions shall be made so that the         
successors and assigns of SBC shall assume all of the obligations set forth     
in this Section.                                                                

             (e) The provisions of this Section are intended to be
for the benefit of, and shall be enforceable by, each of the Indemnified        
Parties, their heirs and their representatives.                                 

 6.13. Takeover Statute. If any Takeover Statute is or may
become applicable to the Merger or the other transactions contemplated by       
this Agreement, each of SBC and the Company and its Board of Directors          
shall grant such approvals and take such actions as are necessary so that       
such transactions may be consummated as promptly as practicable on the          
terms contemplated by this Agreement or by the Merger and otherwise act to      
eliminate or minimize the effects of such statute or regulation on such         
transactions. The Company will cause the Rights Agent to promptly execute       
the Rights Amendment.                                                           

  6.14. Dividends. The Company shall coordinate with SBC the
declaration, setting of record dates and payment dates of dividends on          
Company Shares so that holders of Company Shares do not receive dividends       
on both Company Shares and SBC Common Stock received in the Merger in           
respect of any calendar quarter or fail to receive a dividend on either         
Company Shares or SBC Common Stock received in the Merger in respect of any     
calendar quarter.                                                               

    6.15. Confidentiality. The Company and SBC each acknowledges
and confirms that it has entered into a Confidentiality and NonDisclosure       
Agreement, dated April 8, 1997 (the "Confidentiality Agreement"), that          
information provided by each party hereto to the other party hereto             
pursuant to this Agreement is subject to the terms of the Confidentiality       
Agreement and that the Confidentiality Agreement shall remain in full force     
and effect in accordance with its terms, except that notwithstanding any        
provision to the contrary contained in the Confidentiality Agreement, the       
Confidentiality Agreement shall not terminate until the earlier to occur of     
the following: (i) the Effective Time and (ii) the expiration of two years      
following the date of any termination of this Agreement pursuant to Article     
VIII.                                                                           

       6.16. Control of the Company's Operations. Nothing contained in
this Agreement shall give SBC or the Company, directly or indirectly,           
rights to control or direct the operations of the other prior to the            
Effective Time. Prior to the Effective Time, each of SBC and the Company        
shall exercise, consistent with the terms and conditions of this Agreement,     
complete control and supervision of its operations.                             

ARTICLE VII     

Conditions    

7.1. Conditions to Each Party's Obligation to Effect the
Merger. The respective obligation of each party to effect the Merger is         
subject to the satisfaction or waiver at or prior to the Effective Time of      
each of the following conditions:                                               

           (a) Stockholder Approval. This Agreement shall have
been duly adopted by holders of Company Shares constituting the Company         
Requisite Vote and have been duly adopted by the sole stockholder of Merger     
Sub, and the issuance of SBC Common Stock required to be issued pursuant to     
Article IV shall have been duly approved by the holders of shares of SBC        
Common Stock constituting the SBC Requisite Vote;                               

        (b) NYSE Listing. The shares of SBC Common Stock
issuable to the Company stockholders pursuant to this Agreement shall have      
been authorized for listing on the NYSE upon official notice of issuance.       

     (c) Governmental Consents. The waiting period
applicable to the consummation of the Merger under the HSR Act shall have       
expired or been terminated and all material Company Required Consents and       
material SBC Required Consents from or with any Governmental Entity shall       
have been made or obtained pursuant to a Final Order, free of any               
conditions (other than conditions that are not reasonably likely, either        
individually or in the aggregate, to have a Regulatory Material Adverse         
Effect). For the purposes of this Agreement, "Final Order" means an action      
or decision that has been granted as to which (a) no request for a stay or      
any similar request is pending, no stay is in effect, the action or             
decision has not been vacated, reversed, set aside, annulled or suspended       
and any deadline for filing such a request that may be designated by            
statute or regulation has passed, (b) no petition for rehearing or              
reconsideration or application for review is pending and the time for the       
filing of any such petition or application has passed, (c) no Governmental      
Entity has undertaken to reconsider the action on its own motion and the        
time within which it may effect such reconsideration has passed and (d) no      
appeal is pending (including other administrative or judicial review) or in     
effect and any deadline for filing any such appeal that may be specified by     
statute or rule has passed, which in any such case (a), (b), (c) or (d) is      
reasonably likely to result in vacating, reversing, setting aside,              
annulling, suspending or modifying such action or decision (in any such         
case in a manner which would have a Regulatory Material Adverse Effect          
following the Effective Time).                                                  

               (d) Laws and Order. No Governmental Entity of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered       
any Law (whether temporary, preliminary or permanent) that is in effect and     
restrains, enjoins or otherwise prohibits consummation of the Merger or the     
other transactions contemplated by this Agreement or that is, individually      
or in the aggregate with all other such Laws, reasonably likely to have a       
Material Adverse Effect on SBC or the Company (collectively, an "Order"),       
and no Governmental Entity shall have instituted any proceeding, or, in the     
case of a federal Governmental Entity, threatened in writing to institute       
any proceeding, seeking any such Order.                                         

          (e) S-4. The S-4 Registration Statement shall have
become effective under the Securities Act. No stop order suspending the         
effectiveness of the S-4 Registration Statement shall have been issued, and     
no proceedings for that purpose shall have been initiated or be threatened      
by the SEC.                                                                     

           (f) Accountants' Letters. SBC and the Company shall
have received the "comfort" letters described in Section 6.5(b). SBC and        
the Company shall have received letters from their respective independent       
public accounting firms to the effect that the Merger will qualify for          
"pooling of interests" accounting treatment.                                    

           (g) Blue Sky Approvals. SBC shall have received all
state securities and "blue sky" permits and approvals necessary to              
consummate the transactions contemplated hereby.                                

 7.2. Conditions to Obligations of SBC and Merger Sub. The
obligations of SBC and Merger Sub to effect the Merger are also subject to      
the satisfaction or waiver by SBC at or prior to the Effective Time of the      
following conditions:                                                           

               (a) Representations and Warranties. The representations
and warranties of the Company set forth in this Agreement (i) to the extent     
qualified by Material Adverse Effect shall be true and correct and (ii) to      
the extent not qualified by Material Adverse Effect shall be true and           
correct, except that this clause (ii) shall be deemed satisfied so long as      
any failures of such representations and warranties to be true and correct,     
taken together, do not have a Material Adverse Effect on the Company, in        
each case (i) and (ii), as of the Closing Date as though made on and as of      
the Closing Date (except to the extent such representations and warranties      
speak as of an earlier date), and SBC shall have received a certificate         
signed on behalf of the Company by an executive officer of the Company to       
such effect.                                                                    

          (b) Performance of Obligations of the Company. The
Company shall have performed in all material respects all obligations           
required to be performed by it under this Agreement at or prior to the          
Closing Date, and SBC shall have received a certificate signed on behalf of     
the Company by an executive officer of the Company to such effect.              

             (c) Consents Under Agreements. The Company shall have
obtained the consent or approval of each Person whose consent or approval       
shall be required in order to consummate the transactions contemplated by       
this Agreement under any Contract to which the Company or any of its            
Subsidiaries is a party, except those for which the failure to obtain such      
consent or approval, individually or in the aggregate, is not reasonably        
likely to have, a Material Adverse Effect on the Company.                       

               (d) Tax Opinion. SBC shall have received the opinion of
Sullivan & Cromwell, counsel to SBC, dated the Closing Date, to the effect      
that the Merger will be treated for Federal income tax purposes as a            
reorganization within the meaning of Section 368(a) of the Code, and that       
each of SBC, Merger Sub and the Company will be a party to that                 
reorganization within the meaning of Section 368(b) of the Code; it being       
understood that in rendering such opinion, such counsel shall be entitled       
to rely on certain customary representations and assumptions.                   

       7.3. Conditions to Obligation of the Company. The obligation of
the Company to effect the Merger is also subject to the satisfaction or         
waiver by the Company at or prior to the Effective Time of the following        
conditions:                                                                     

               (a) Representations and Warranties. The representations
and warranties of SBC and Merger Sub set forth in this Agreement (i) to the     
extent qualified by Material Adverse Effect shall be true and correct, and      
(ii) to the extent not qualified by Material Adverse Effect shall be true       
and correct, except that this clause (ii) shall be deemed satisfied so long     
as any failures of such representations and warranties to be true and           
correct, taken together, do not have a Material Adverse Effect on SBC, in       
each case (i) and (ii), as of the Closing Date as though made on and as of      
the Closing Date (except to the extent such representations and warranties      
speak as of an earlier date), and the Company shall have received a             
certificate signed on behalf of SBC by an executive officer of SBC to such      
effect.                                                                         

             (b) Performance of Obligations of SBC and Merger Sub.
Each of SBC and Merger Sub shall have performed in all material respects        
all obligations required to be performed by it under this Agreement at or       
prior to the Closing Date, and the Company shall have received a                
certificate signed on behalf of SBC and Merger Sub by an executive officer      
of SBC to such effect.                                                          

            (c) Tax Opinion. The Company shall have received the
opinion of Skadden, Arps, Slate, Meagher & Flom (Illinois), counsel to the      
Company, dated the Closing Date, to the effect that the Merger will be          
treated for Federal income tax purposes as a reorganization within the          
meaning of Section 368(a) of the Code, and that each of SBC, Merger Sub and     
the Company will be a party to that reorganization within the meaning of        
Section 368(b) of the Code; it being understood that in rendering such          
opinion, such counsel shall be entitled to rely on certain customary            
representations and assumptions.                                                

ARTICLE VIII    

Termination     

 8.1. Termination by Mutual Consent. This Agreement may be
terminated and the Merger may be abandoned at any time prior to the             
Effective Time, whether before or after the approval by stockholders of the     
Company and SBC referred to in Section 7.1(a), by mutual written consent of     
the Company and SBC, by action of their respective Boards of Directors.         

     8.2. Termination by Either SBC or the Company. This Agreement
may be terminated and the Merger may be abandoned at any time prior to the      
Effective Time by action of the Board of Directors of either SBC or the         
Company if (i) the Merger shall not have been consummated by July 31, 1999      
(the "Termination Date"), whether such date is before or after the date of      
approval by the stockholders of the Company or SBC; provided, however, that     
if SBC or the Company determines that additional time is necessary in           
connection with obtaining a SBC Required Consent or a Company Required          
Consent from or with any Governmental Entity, the Termination Date may be       
extended for up to 60 calendar days at any one time by SBC or the Company       
from time to time by written notice to the other party up to a date not         
beyond March 31, 2000, which date shall be deemed to be the Termination         
Date, (ii) the adoption of this Agreement by the Company's stockholders         
required by Section 7.1(a) shall not have occurred at a meeting duly            
convened therefor or at any adjournment or postponement thereof, (iii) the      
approval of SBC's stockholders necessary for the issuance of SBC Common         
Stock required to be issued pursuant to Article IV as required by Section       
7.1(a) shall not have been obtained at a meeting duly convened therefor or      
at any adjournment or postponement thereof, or (iv) any Order permanently       
restraining, enjoining or otherwise prohibiting consummation of the Merger      
shall become final and non-appealable (whether before or after the adoption     
or approval by the stockholders of the Company or SBC, as the case may be);     
provided, that the right to terminate this Agreement pursuant to clause (i)     
above shall not be available to any party that has breached in any material     
respect its obligations under this Agreement in any manner that shall have      
proximately contributed to the failure of the Merger to be consummated.         

8.3. Termination by the Company. This Agreement may be  
terminated and the Merger may be abandoned at any time prior to the             
Effective Time, whether before or after the adoption of this Agreement by       
the stockholders of the Company referred to in Section 7.1(a), by action of     
the Board of Directors of the Company:                                          

                 (a) if (i) the Board of Directors of the Company approves
entering into a binding written agreement concerning a transaction that         
constitutes a Superior Company Proposal and the Company notifies SBC in         
writing that the Company desires to enter into such agreement, (ii) SBC         
does not make, within ten calendar days after receipt of the Company's          
written notification of its desire to enter into a binding agreement for a      
Superior Company Proposal, the terms of which are specified in such notice,     
an offer that the Board of Directors of the Company believes, in good faith     
after consultation with its financial advisors, is at least as favorable,       
from a financial point of view, to the stockholders of the Company as the       
Superior Company Proposal, and (iii) the Company prior to such termination      
pays to SBC in immediately available funds any fees required to be paid         
pursuant to Section 8.5(b). The Company agrees to notify SBC promptly if        
its desire to enter into a written agreement referred to in its                 
notification shall change at any time after giving such notification; or        

           (b) if (i) the Board of Directors of SBC shall have
withdrawn or adversely modified its approval of this Agreement or its           
recommendation to the stockholders of SBC that such stockholders approve the    
issuance of SBC Common Stock required to be issued pursuant to Article IV or    
failed to reconfirm such recommendation within fifteen business days after a    
written request by the Company to do so; provided that such a request is made   
after the Board of Directors of SBC or any SBC Representative shall have taken  
any of the actions that would be proscribed by Section 6.2(b) but for the       
exception therein allowing certain actions to be taken pursuant to clause       
(B) or (C) of the proviso thereof with respect to any bona fide written SBC     
Acquisition Proposal that has not been withdrawn or rejected by the Board       
of Directors of SBC, (ii) there has been a material breach by SBC or Merger     
Sub of any representation, warranty, covenant or agreement contained in         
this Agreement which (x) would result in a failure of a condition set forth     
in Section 7.3(a) or 7.3(b) and (y) cannot be or is not cured prior to the      
Termination Date, or (iii) SBC or any SBC Representative shall take any of      
the actions that would be proscribed by Section 6.2(b) but for the              
exception therein allowing certain actions to be taken pursuant to clause       
(B) or (C) of the proviso thereof (other than any such actions taken            
pursuant to such clause (B) with respect to any bona fide written SBC           
Acquisition Proposal (received after the date hereof that was not solicited     
by SBC after the date hereof) during the Initial 50 Day Period, if such SBC     
Acquisition Proposal is received during the first through the 30th days of      
the Initial 50 Day Period or during the 20 calendar day period following        
receipt of such SBC Acquisition Proposal by SBC if such SBC Acquisition         
Proposal is received during the 31st through 50th days of the Initial 50        
Day Period, in each case if, and only if, SBC receives such SBC Acquisition     
Proposal during the Initial 50 Day Period). For purposes of this Agreement,     
the "Initial 50 Day Period" shall mean the 50 calendar day period               
commencing with the first calendar day after the day on which this              
Agreement shall have been filed by SBC or the Company with the SEC as an        
exhibit to a Current Report on Form 8K under the Exchange Act.                  

     8.4. Termination by SBC. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time, before     
or after the approval by the stockholders of SBC referred to in Section         
7.1(a), by action of the Board of Directors of SBC:                             

(a)  If (i) the Board of Directors of   
SBC approves entering into a binding written agreement concerning a             
transaction that constitutes a Superior SBC Proposal and SBC notifies the       
Company in writing that SBC desires to enter into such agreement, (ii) the      
Company does not make, within ten days after receipt of SBC's written           
notification of its desire to enter into a binding agreement for a Superior     
SBC Proposal, the terms of which are specified in such notice, an offer         
that the Board of Directors of SBC believes, in good faith after                
consultation with its financial advisors, is at least as favorable, from a      
financial point of view, to the stockholders of SBC as the Superior SBC         
Proposal, and (iii) SBC prior to such termination pays to the Company in        
immediately available funds any fees required to be paid pursuant to            
Section 8.5(c). SBC agrees to notify the Company promptly if its desire to      
enter into a written agreement referred to in its notification shall change     
at any time after giving such notification.                                     

              (b) If (i) the Board of Directors of the Company shall
have withdrawn or adversely modified its approval or recommendation to the      
Company's stockholders of this Agreement, or failed to reconfirm such           
recommendation within fifteen business days after a written request by SBC      
to do so; provided that such a request is made after the Board of Directors     
of the Company or any Company Representative shall have taken any of the        
actions that would be proscribed by Section 6.2(a) but for the exception        
therein allowing certain actions to be taken pursuant to clause (B) or (C)      
of the proviso thereof with respect to any bona fide written Company            
Acquisition Proposal that has not been withdrawn or rejected by the Board       
of Directors of the Company, or (ii) there has been a material breach by        
the Company of any representation, warranty, covenant or agreement              
contained in this Agreement which (x) would result in a failure of a            
condition set forth in Section 7.2(a) or 7.2(b) and (y) cannot be or is not     
cured prior to the Termination Date, or (iii) if the Company or any Company     
Representative shall take any of the actions that would be proscribed by        
Section 6.2(a) but for the exception therein allowing certain actions to be     
taken pursuant to clause (B) or (C) of the proviso thereof (other than any      
such actions taken pursuant to such clause (B) with respect to any bona         
fide written Company Acquisition Proposal (received after the date hereof       
that was not solicited by the Company after the date hereof) during the         
Initial 50 Day Period, if such Company Acquisition Proposal is received         
during the first through the 30th days of the Initial 50 Day Period or          
during the 20 calendar day period following receipt of such Company             
Acquisition Proposal by the Company if such Company Acquisition Proposal is     
received during the 31st through 50th days of the Initial 50 Day Period, in     
each case if, and only if, the Company receives such Company Acquisition        
Proposal during the Initial 50 Day Period).                                     

       8.5. Effect of Termination and Abandonment. (a) In the event of
termination of this Agreement and the abandonment of the Merger pursuant to     
this Article VIII, this Agreement (other than as set forth in Section 9.1)      
shall become void and of no effect with no liability on the part of any         
party hereto (or of any of its directors, officers, employees, agents,          
legal or financial advisors or other representatives); provided, however,       
no such termination shall relieve any party hereto from any liability for       
damages resulting from any willful and intentional breach of this Agreement     
(to the extent any such damages exceed any Termination Fee that may have        
been paid pursuant to Section 8.5(b) or 8.5(c)) or from any obligation to       
pay, if applicable, the Termination Fee pursuant to Section 8.5(b) or           
8.5(c).                                                                         

                 (b) In the event that (i) a bona fide Company Acquisition
Proposal shall have been made to the Company and made known to stockholders     
generally or have been made directly to stockholders generally or any           
Person shall have publicly announced an intention (whether or not               
conditional) to make a bona fide Company Acquisition Proposal and such          
Company Acquisition Proposal or announced intention shall not have been         
withdrawn prior to the Company's Stockholders Meeting and thereafter this       
Agreement is terminated by either SBC or the Company pursuant to Section        
8.2(ii) and within nine months after such termination the Company shall         
have entered into an agreement to consummate a transaction that would           
constitute a Company Acquisition Proposal if it were the subject of a           
proposal, or (ii) this Agreement is terminated (x) by the Company pursuant      
to Section 8.3(a) or (y) by SBC pursuant to Section 8.4(b)(i), (b)(ii)          
(solely with respect to a willful and intentional breach) or (b)(iii), then     
the Company shall promptly, but in no event later than two days after the       
date of such termination (except as otherwise provided in Section 8.3(a)),      
or, in the case of termination pursuant to Section 8.2(ii), two days after      
the relevant agreement is entered into, pay SBC a fee equal to $1.2 billion     
(the "Termination Fee"), which amount shall be exclusive of any expenses to     
be paid pursuant to Section 6.11, payable by wire transfer of same day          
funds. The Company acknowledges that the agreements contained in this           
Section 8.5(b) are an integral part of the transactions contemplated by         
this Agreement, and that, without these agreements, SBC and Merger Sub          
would not enter into this Agreement; accordingly, if the Company fails to       
pay promptly the amount due pursuant to this Section 8.5(b), and, in order      
to obtain such payment, SBC or Merger Sub commences a suit which results in     
a judgment against the Company for the fee set forth in this paragraph (b),     
the Company shall pay to SBC or Merger Sub its costs and expenses               
(including attorneys' fees) in connection with such suit, together with         
interest on the amount of the fee at the prime rate of Citibank N.A. in         
effect on the date such payment was required to be made.                        

             (c) In the event that (i) a bona fide SBC Acquisition
Proposal shall have been made to SBC and made known to stockholders generally   
or shall have been made directly to stockholders generally or any Person shall  
have publicly announced an intention (whether or not conditional) to make a     
bona fide SBC Acquisition Proposal and such SBC Acquisition Proposal or         
announced intention shall not have been withdrawn prior to the SBC              
Stockholder Meeting and thereafter this Agreement is terminated by the          
Company or SBC pursuant to Section 8.2(iii) and within nine months after        
such termination SBC shall have entered into an agreement to consummate a       
transaction that would constitute a SBC Acquisition Proposal if it were the     
subject of a proposal, or (ii) this Agreement is terminated (x) by SBC          
pursuant to Section 8.4(a) or (y) by the Company pursuant to Section            
8.3(b)(i), (b)(ii) (solely with respect to a willful and intentional            
breach) or (b)(iii), then SBC shall promptly, but in no event later than        
two days after the date of such termination (except as otherwise provided       
in Section 8.4(a)), or, in the case of a termination pursuant to Section        
8.2(iii), two (2) days after the relevant agreement is entered into, pay        
the Company a fee equal to the Termination Fee, which amount shall be           
exclusive of any expenses to be paid pursuant to Section 6.11, payable by       
wire transfer of same day funds. SBC acknowledges that the agreements           
contained in this Section 8.5(c) are an integral part of the transactions       
contemplated by this Agreement, and that, without these agreements, the         
Company would not enter into this Agreement; accordingly, if SBC fails to       
pay promptly the amount due pursuant to this Section 8.5(c), and, in order      
to obtain such payment, the Company commences a suit which results in a         
judgment against SBC for the fee set forth in this paragraph (c), SBC shall     
pay to the Company its costs and expenses (including attorneys' fees) in        
connection with such suit, together with interest on the amount of the fee      
at the prime rate of Citibank N.A. in effect on the date such payment was       
required to be made.                                                            

ARTICLE IX    

Miscellaneous and General     

9.1. Survival. This Article IX and the agreements of the
Company, SBC and Merger Sub contained in Sections 6.10 (Benefits), 6.11         
(Expenses) and 6.12 (Indemnification; Directors' and Officers' Insurance)       
shall survive the consummation of the Merger. This Article IX (other than       
Section 9.2 (Modification or Amendment), Section 9.3 (Waiver of Conditions)     
and Section 9.13 (Assignment)) and the agreements of the Company, SBC and       
Merger Sub contained in Section 6.11 (Expenses), Section 6.15                   
(Confidentiality) and Section 8.5 (Effect of Termination and Abandonment)       
shall survive the termination of this Agreement. All other representations,     
warranties, covenants and agreements in this Agreement shall not survive        
the consummation of the Merger or the termination of this Agreement.            

    9.2. Modification or Amendment. Subject to the provisions of
applicable law, at any time prior to the Effective Time, the parties hereto     
may modify or amend this Agreement, by written agreement executed and           
delivered by duly authorized officers of the respective parties.                

      9.3. Waiver of Conditions. (a) Any provision of this Agreement
may be waived prior to the Effective Time if, and only if, such waiver is       
in writing and signed by the party against whom the waiver is to be             
effective.                                                                      

              (b) No failure or delay by any party in exercising any
right, power or privilege hereunder shall operate as a waiver thereof nor       
shall any single or partial exercise thereof preclude any other or further      
exercise thereof or the exercise of any other right, power or privilege.        
Except as otherwise herein provided, the rights and remedies herein             
provided shall be cumulative and not exclusive of any rights or remedies        
provided by law.                                                                

       9.4. Counterparts. This Agreement may be executed in any number
of counterparts, each such counter part being deemed to be an original          
instrument, and all such counterparts shall together constitute the same        
agreement.                                                                      

9.5.    GOVERNING LAW AND VENUE; WAIVER OF JURY         
TRIAL.                                                                          

                 (a) THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL
RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE      
WITH THE LAW OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAW     
PRINCIPLES THEREOF. The parties hereby irrevocably submit to the                
jurisdiction of the Federal courts of the United States of America and the      
state courts located in the State of Delaware solely in respect of the          
interpretation and enforcement of the provisions of this Agreement and of       
the documents referred to in this Agreement, and in respect of the              
transactions contemplated hereby, and hereby waive, and agree not to            
assert, as a defense in any action, suit or proceeding for the                  
interpretation or enforcement hereof or of any such document, that it is        
not subject thereto or that such action, suit or proceeding may not be          
brought or is not maintainable in said courts or that the venue thereof may     
not be appropriate or that this Agreement or any such document may not be       
enforced in or by such courts, and the parties hereto irrevocably agree         
that all claims with respect to such action or proceeding shall be heard        
and determined in such a Federal or state court. The parties hereby consent     
to and grant any such court jurisdiction over the Person of such parties        
and over the subject matter of such dispute and agree that mailing of           
process or other papers in connection with any such action or proceeding in     
the manner provided in Section 9.6 or in such other manner as may be            
permitted by law, shall be valid and sufficient service thereof.                

                 (b) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND       
DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND          
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN      
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING     
TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH     
PARTY CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR           
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT       
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE     
FOREGOING WAIVER, (ii) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE       
IMPLICATIONS OF THIS WAIVER, (iii) EACH SUCH PARTY MAKES THIS WAIVER            
VOLUNTARILY, AND (iv) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS       
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN      
THIS SECTION 9.5.                                                               

9.6. Notices. Notices, requests, instructions or other  
documents to be given under this Agreement shall be in writing and shall be     
deemed given, (i) when sent if sent by facsimile, provided that the fax is      
promptly confirmed by telephone confirmation thereof, (ii) when delivered,      
if delivered personally to the intended recipient, and (iii) one business       
day later, if sent by overnight delivery via a national courier service,        
and in each case, addressed to a party at the following address for such        
party:                                                                          

if to SBC or Merger Sub                                 

SBC Communications Inc.                                 
175 E. Houston                                          
San Antonio, Texas 78205                                
Attention:  James D. Ellis, Esq.                        
Fax: (210) 3512298                                      

with a copy to:                                                     

Benjamin F. Stapleton, Esq.                             
Sullivan & Cromwell                                     
125 Broad Street                                        
New York, NY  10004                                     
Fax:  (212) 558-3588                                    

if to the Company                                                   

Ameritech Corporation                                   
30 S. Wacker Drive                                      
Chicago, Illinois 60606                                 
Attention: Chairman of the Board, President and         
Chief Executive Officer     
Fax: (312) 2070892    

with copies to:                                                     

Ameritech Corporation                                   
30 S. Wacker Drive                                      
Chicago, Illinois 60606                                 
Attention: Executive Vice President and                 
General Counsel               
Fax: (312) 2071540                                      

and                                                                 

Ameritech Corporation                                   
30 S. Wacker Drive                                      
Chicago, Illinois 60606                                 
Attention: Assistant General Counsel                    
Transactions                  
Fax: (312) 2070086                                      

and                                                                 

Charles W. Mulaney, Jr., Esq.                           
Skadden, Arps, Slate, Meagher & Flom (Illinois)         
333 W. Wacker Dr.                                       
Chicago, Illinois 60606                                 
Fax:  (312) 4070411                                     

or to such other persons or addresses as may be designated in writing by        
the party to receive such notice as provided above.                             

     9.7. Entire Agreement. This Agreement (including any exhibits
hereto), the Confidentiality Agreement, the Company Disclosure Letter and       
the SBC Disclosure Letter constitute the entire agreement, and supersede        
all other prior agreements, understandings, representations and warranties      
both written and oral, among the parties, with respect to the subject           
matter hereof. EACH PARTY HERETO AGREES THAT, EXCEPT FOR THE                    
REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT, NEITHER SBC AND     
MERGER SUB NOR THE COMPANY MAKES ANY OTHER REPRESENTATIONS OR WARRANTIES,       
AND EACH HEREBY DISCLAIMS ANY OTHER REPRESENTATIONS OR WARRANTIES MADE BY       
ITSELF OR ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, FINANCIAL AND      
LEGAL ADVISORS OR OTHER REPRESENTATIVES, WITH RESPECT TO THE EXECUTION AND      
DELIVERY OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY,             
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE OTHER OR THE OTHER'S          
REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION WITH RESPECT TO       
ANY ONE OR MORE OF THE FOREGOING.                                               

9.8. No Third Party Beneficiaries. Except as provided in
Section 6.12 (Indemnification; Directors' and Officers' Insurance), this        
Agreement is not intended to confer upon any Person other than the parties      
hereto any rights or remedies hereunder.                                        

 9.9. Obligations of SBC and of the Company. Whenever this
Agreement requires a Subsidiary of SBC to take any action, such requirement     
shall be deemed to include an undertaking on the part of SBC to cause such      
Subsidiary to take such action. Whenever this Agreement requires a              
Subsidiary of the Company to take any action, such requirement shall be         
deemed to include an undertaking on the part of the Company to cause such       
Subsidiary to take such action and, after the Effective Time, on the part       
of the Surviving Corporation to cause such Subsidiary to take such action.      

     9.10. Severability. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision        
shall not affect the validity or enforceability or the other provisions         
hereof. If any provision of this Agreement, or the application thereof to       
any Person or any circumstance, is invalid or unenforceable, (a) a suitable     
and equitable provision shall be substituted therefor in order to carry         
out, so far as may be valid and enforceable, the intent and purpose of such     
invalid or unenforceable provision and (b) the remainder of this Agreement      
and the application of such provision to other Persons or circumstances         
shall not be affected by such invalidity or unenforceability, nor shall         
such invalidity or unenforceability affect the validity or enforceability       
of such provision, or the application thereof, in any other jurisdiction.       

       9.11. Interpretation. The table of contents and headings herein
are for convenience of reference only, do not constitute part of this           
Agreement and shall not be deemed to limit or otherwise affect any of the       
provisions hereof. Where a reference in this Agreement is made to a Section     
or Exhibit, such reference shall be to a Section of or Exhibit to this          
Agreement unless otherwise indicated. Whenever the words "include,"             
"includes" or "including" are used in this Agreement, they shall be deemed      
to be followed by the words "without limitation."                               

   9.12. Captions. The Article, Section and paragraph captions
herein are for convenience of reference only, do not constitute part of         
this Agreement and shall not be deemed to limit or otherwise affect any of      
the provisions hereof.                                                          

   9.13. Assignment. This Agreement shall not be assignable by
operation of law or otherwise; provided, however, that SBC may designate        
prior to the Effective Time, by written notice to the Company, another          
wholly-owned direct or indirect Subsidiary to be a party to the Merger in       
lieu of Merger Sub, in which event all references herein to Merger Sub          
shall be deemed references to such other Subsidiary (except with respect to     
representations and warranties made herein with respect to Merger Sub as of     
the date hereof) and all representations and warranties made herein with        
respect to Merger Sub as of the date hereof shall also be made with respect     
to such other subsidiary as of the date of such designation. Any assignment     
in contravention of the preceding sentence shall be null and void.              

     IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties hereto as of the       
date first written above.                                                       

 AMERITECH CORPORATION

        By: /s/ Richard C. Notebaert
                   _______________________________
                 Name:  Richard C. Notebaert
                      Title: Chairman of the the Board
                               and Chief Executive Officer

   SBC COMMUNICATIONS INC.

           By: /s/ Edward E. Whitacre, Jr.
                  ______________________________
                    Name:  Edward E. Whitacre, Jr.
                  Title: Chairman of the Board
                               and Chief Executive Officer

SBC DELAWARE, INC.  

           By: /s/ Edward E. Whitacre, Jr.
                   _______________________________
                    Name:  Edward E. Whitacre, Jr.
      Title: President

                                                             EXHIBIT A

FORM OF COMPANY AFFILIATE'S LETTER    

_______, 1998                                                                   

SBC Communications Inc.                                                         
175 E. Houston                                                                  
San Antonio, TX   78205                                                         

Ladies and Gentlemen:                                                           

The undersigned is a holder of shares of Common Stock, $1.00 par value per      
share ("Company Common Stock"), of Ameritech Corporation, a Delaware            
corporation (the "Company"). Pursuant to the terms of that certain              
Agreement and Plan of Merger, dated as of May 10, 1998, among the Company,      
SBC Communications Inc., a Delaware corporation ("SBC"), and SBC                
(Delaware), Inc., a Delaware corporation and a whollyowned subsidiary of        
SBC ("Merger Sub"), Merger Sub will be merged with and into the Company and     
the Company will become a wholly owned subsidiary of SBC (the "Merger"). In     
connection with the Merger, the undersigned, as a holder of Company Common      
Stock, will be entitled to receive Common Stock, par value $1.00 per share,     
of SBC (the "Securities") in exchange for the shares of Company Common          
Stock held by the undersigned at the effective time of the Merger.              

The undersigned acknowledges that the undersigned may be deemed an              
"affiliate" of the Company within the meaning of Rule 145 ("Rule 145")          
promulgated under the Securities Act of 1933, as amended (the "Act"),           
and/or as such term is used in and for purposes of Accounting Series            
Release Nos. 130 and 135, as amended, of the Securities and Exchange            
Commission (the "Commission"), although nothing contained herein shall be       
construed as an admission of such status.                                       

If in fact the undersigned were an affiliate of the Company under the Act,      
the undersigned's ability to sell, assign or transfer any Securities            
received by the undersigned in exchange for any shares of Company Common        
Stock pursuant to the Merger may be restricted unless such sale, assignment     
or transfer is registered under the Act or an exemption from such               
registration is available. The undersigned understands that such exemptions     
are limited and the undersigned has obtained advice of counsel as to the        
nature and conditions of such exemptions, including information with            
respect to the applicability to the sale of such Securities of Rules 144        
and 145(d) promulgated under the Act.                                           

The undersigned hereby represents to and covenants with SBC that it will        
not sell, assign or transfer any Securities received by the undersigned in      
exchange for shares of Company Common Stock pursuant to the Merger except       
(i) pursuant to an effective registration statement under the Act, (ii) by      
a sale made in conformity with the volume and other limitations of Rule 145     
(and otherwise in accordance with Rule 144 under the Act, if the                
undersigned is an affiliate of SBC and if so required at the time) or (iii)     
in a transaction which, in the opinion of independent counsel reasonably        
satisfactory to the Company or as described in a "noaction" or interpretive     
letter from the Staff of the Commission reasonably satisfactory to SBC, is      
not required to be registered under the Act.                                    

The undersigned understands that SBC is under no obligation to register the     
sale, assignment, transfer or other disposition of the Securities by the        
undersigned or on behalf of the undersigned under the Act or to take any        
other action necessary in order to make compliance with an exemption from       
such registration available solely as a result of the Merger.                   

In the event of a sale of Securities pursuant to Rule 145, the undersigned      
will supply SBC with evidence of compliance with such Rule, in the form of      
customary seller's and broker's Rule 145 representation letters or as SBC       
may otherwise reasonably request. The undersigned understands that SBC may      
instruct its transfer agent to withhold the transfer of any Securities          
disposed of by the undersigned in a manner inconsistent with this letter.       

The undersigned acknowledges and agrees that appropriate legends will be        
placed on certificates representing Securities received by the undersigned      
in the Merger or held by a transferee thereof, which legends will be            
removed (i) by delivery of substitute certificates upon receipt of a letter     
from the staff of the Commission, or an opinion of counsel in form and          
substance reasonably satisfactory to SBC, to the effect that such legends       
are no longer required for the purposes of the Act and the rules and            
regulations of the Commission promulgated thereunder, (ii) in the event of      
a sale of the Securities which has been registered under the Act or made in     
conformity with the provisions of Rule 145.                                     

The undersigned further represents to and covenants with SBC that (i) the       
undersigned will not, during the 30 days prior to the effective time of the     
Merger sell, transfer or otherwise dispose of, or reduce any risk relative      
to, any securities of the Company or SBC, and (ii) the undersigned will         
not, after the effective time of the Merger, sell, transfer or otherwise        
dispose of, or reduce any risk relative to, the Securities, whether             
received by the undersigned in the Merger or otherwise, until after such        
time as financial results covering at least 30 days of postMerger               
operations of SBC (including the combined operations of the Company and         
SBC) have been published by SBC in the form of a quarterly earnings report,     
an effective registration statement filed with the Commission, a report to      
the Commission on Form 10K, 10Q or 8K, or any other public filing or            
announcement which includes such results of operations, except in the cases     
of clauses (i) and (ii) of this paragraph to the extent permitted by, and       
in accordance with, SEC Accounting Series Release 135 and SEC Staff             
Accounting Bulletins 65 and 76 if and to the extent that such release and       
bulletins remain in full force and effect at the relevant time.                 

I further understand and agree that this letter agreement shall apply to        
all shares of Company Common Stock and Securities that I am deemed to           
beneficially own pursuant to applicable federal securities law.                 

The undersigned acknowledges that it has carefully reviewed this letter and     
understands the requirements hereof and the limitations imposed upon the        
distribution, sale, transfer or other disposition of Securities.                

Sincerely,                                                                      

[NAME OF COMPANY AFFILIATE]                                                     

                                                             EXHIBIT B

FORM OF SBC AFFILIATE'S LETTER    

_______, 1998                                                                   

SBC Communications Inc.                                                         
175 E. Houston                                                                  
San Antonio, TX   78205                                                         

Ladies and Gentlemen:                                                           

The undersigned is a holder of shares of Common Stock, par value $1.00 per      
share (the "Securities"), of SBC Communications Inc., a Delaware                
corporation ("SBC"). Pursuant to the terms of that certain Agreement and        
Plan of Merger, dated as of May 10, 1998, among Ameritech Corporation, a        
Delaware corporation (the "Company"), SBC and SBC Delaware, Inc., a             
Delaware corporation and a whollyowned subsidiary of SBC ("Merger Sub"),        
Merger Sub will be merged with and into the Company and the Company will        
become a wholly owned subsidiary of SBC (the "Merger").                         

The undersigned acknowledges that the undersigned may be deemed an              
"affiliate" of SBC as such term is used in and for purposes of Accounting       
Series Release Nos. 130 and 135, as amended, of the Securities and Exchange     
Commission (the "Commission"), although nothing contained herein shall be       
construed as an admission of such status.                                       

The undersigned hereby represents to and covenants with SBC that the            
undersigned will not, during the 30 days prior to the effective time of the     
Merger sell, transfer or otherwise dispose of, or reduce any risk relative      
to, the Securities or any other shares of the capital stock of SBC until        
after such time as financial results covering at least 30 days of               
postMerger operations of SBC (including the combined operations of the          
Company and SBC) have been published by SBC in the form of a quarterly          
earnings report, an effective registration statement filed with the             
Commission, a report to the Commission on Form 10K, 10Q or 8K, or any other     
public filing or announcement which includes such results of operations,        
except to the extent permitted by, and in accordance with, SEC Accounting       
Series Release 135 and SEC Staff Accounting Bulletins 65 and 76 if and to       
the extent that such release and bulletins remain in full force and effect      
at the relevant time.                                                           

I further understand and agree that this letter agreement shall apply to        
all Securities that I am deemed to beneficially own pursuant to applicable      
federal securities law.                                                         

The undersigned acknowledges that the undersigned has carefully reviewed        
this letter and understands the requirements hereof and the limitations         
imposed upon the sale, transfer or other disposition of Securities.             

Sincerely,                                                                      

[NAME OF SBC AFFILIATE]                                                         

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘8-K’ Filing		Date		Other Filings
		3/31/00
		7/31/99
Filed on / For Period End:		5/11/98
		5/10/98
		5/8/98
		4/30/98
		1/4/98
		12/31/97		10-K/A,  10-K405
		4/8/97
		6/15/94		10-K/A
		8/5/92
				List all Filings