2006 Annual Meeting Newsletter

Because we will be using a conference bridge, additional volunteer hosting sites will be appreciated. Please contact the association at info@aasbcr.org . We will provide you with the specifics upon your contact.

The tentative agenda is as follows:
1:00 P.M. CDT - 2:00 P.M. EDT

(All agenda changes will be posted on the web page.
Please check shortly before the meeting for the final agenda.)

· Call to order by President Bruce Beckman.

· Review 2005-2006 accomplishments – Bruce and the Board

· Introduction of the new AASBCR Board of Directors

· Review of the Membership Survey – Board and Membership

· Plans for the 2006-2007 year – Bruce and the New Board

(Membership input is encouraged)

· Membership “Open Mike”

· Adjourn

ATT Annual Shareholders Meeting Report

April 28, 2006

San Antonio, Texas

Chet Przybyslawski and I attended the annual ATT shareholders two weeks ago. This is a brief summary of activities. During the two days there, in addition to the Shareholders Meeting, we held an all day confab with the three other official retiree groups that represent other segments now known as ATT. They included the old Pac Bell, SNET and ATT segments. Most of the afternoon segment was devoted to meeting with mid and senior managers from ATT Human Resources.

During the last year, representatives from these groups have met on an ad-hoc basis and have come to be known as the Coalition of ATT Retiree Associations. The following is a summary of those two days:

Attendees: Ameritech (AASBCR) - Bruce Beckman, President, Chet Przybyslawski, Vice President; Southern New England Telephone (SRA) - JoAnn Alix Gagain, President; AT&T (ACER) - Jane Banfield; Pacific Bell/Nevada Bell - (Telco Retirees Association, Inc.) - S.K. Emery, President, Muriel Wick, Secretary.

AT&T Corporate Attendees: Sue Colburn, Vice President - Benefits; Debbie Trammell, Executive Director - Health Benefits; Forrest Parrott, Executive Director - AT&T Employee Communications; Martin Webb, Assistant Vice President - Health Plan Operations; John Brockman, Executive Director - Retirement Plan Design; Jeff Mains, Executive Director - Health Plan Design; Pam Medina, Associate Director - Human Resources.

Agenda

This included:

- Review of individual retiree association issues and programs

- Selection and appointment of a Coalition facilitator (It was agreed that on many issues we will need to speak with one voice but before that can happen we need to start to build a national plan. We believe the selection of a Coalition facilitator to evaluate, design and implement a potential organization process that can encompass all existing retiree organizations as well as the future development of retiree associations in Bell South and Southwestern Bell would drive this process).

- Benefit issues (mandatory portability amendment, retiree Death Benefits, Medicare Part D coverage - 2007, deferred vested pensions - spousal eligibility, AT&T retiree communication plan),

Coalition Facilitator

It was agreed by all attendees the selection and appointment of a retiree facilitator with extensive organizational skills and capabilities is needed to review, analyze and develop a long term plan for the future growth and development of an all-encompassing AT&T retiree Coalition. The project will include the following: Type of corporate organization, legal structure, administrative and leadership needs, financial arrangements, website, communication requirements and membership growth plans.

Mandatory Portability

This is an issue that affects both present and future retirees but must be addressed.

This issue involves former AT&T employees who have been merged into the “new” AT&T Company and who qualify under the MPA rules. Are their pensions to be recalculated on the premise they had been an SBC/AT&T employee from the beginning?

Retiree Death Benefits

In December 1992 Pacific Telesis issued a Benefits document entitled “Assignment for Value and Accelerated Death Benefits.” These new provisions were added to their Group Basic and Supplementary Death Benefit Plan for both active and retired employees. The provisions allow eligible retirees to receive a cash benefit through their Basic and/or Supplementary Group Term Life Insurance coverage prior to their death. While this was via Pac Bell, it has implications for Ameritech Retirees in that ATT will need to develop a consistent policy that may permit Ameritech retirees to gain access to the future revenue stream.

This issue has not been publicized by SBC or AT&T. We requested AT&T Benefits include this information in a future Summary of Material Modifications.

Medicare Part D (2007): Coalition representatives requested a clear understanding relative to AT&T’s future plans for continuation of the current (federally subsidized) pharmaceutical program for 2007. Sue Colburn, Vice President - Benefits, indicated AT&T has no plans for altering the present retiree pharmaceutical program for the year 2007.

Deferred Vested Pension: SBC Annual Financial Reports (5500) for 2002, 2003 and 2004 contained a “Summary of Plan Provisions - PTG Pension Plan” entitled “Deferred Vested Pension.”

A study found that (At least 5 years of vesting service - eligibility: termination of employment after completing at least 5 years of vesting service and before reaching eligibility for service pension.) the monthly benefit, payable as a straight life annuity starting on the Participant’s Normal Retirement Age (the latter of age 65 or the fifth anniversary of plan participation), equals the Participant’s Accrued Benefit on the date of termination. This is an important issue for those who have access to a vested pension from ATT (Ameritech, SWBT, Pac Bell, etc.)

Surviving Spouse’s Benefit: Eligibility: The Surviving spouse of an active vested or deferred vested Participant in the event of the Participant’s death is entitled to one of the following benefits:

- If the Participant dies with 5 or more years of Vesting Service, has less than 15 years of Pension Eligibility Service, and is not eligible for a Service Pension, the eligible spouse receives a deferred monthly survivor benefit for life beginning on the date the Participant would have reached earliest eligibility. (This is contrary to previous information and will need to be clarified)

- If the Participant dies eligible for a Service Pension or with 15 years of Pension Eligibility Service, a surviving spouse receives a monthly survivor pension payable for life equal to 45% of the Accrued Benefit.

This Vested Retirement Benefit has not appeared in an SBC/AT&T Summary of Material Modifications. The coalition requested AT&T Health Benefits Group provides such a document in the future.

AT&T Retiree Communication Plans

Plans are in progress for the development of an entirely new e-mail concept in AT&T retiree communications. Forrest Parrott, ATT Corporate Communications, was invited to attend the Coalition meeting in San Antonio.

When asked, the coalition representatives recommended the new publications be all-encompassing, including issues germane to retirees and their benefits, inclusion of the “In Memoriam” segment, news of company plans and programs where retirees could provide public affairs support on issues of vital importance to AT&T.

We also strongly reminded Mr. Parrott that approximately one-third of retirees lacked access to the internet and would require another form of communication. This issue was unresolved during the conference and was identified as an area of concern.

Mr. Parrott said his organization would give careful consideration to our recommendations. He also emphasized his personal commitment for an immediate improvement in retiree communications and announced plans were under way for the mailing of a post card to all AT&T retirees requesting their personal email addresses.

AT&T Stockholders’ Meeting

On April 28, 2006 the Coalition of AT&T Retirees adjourned its formal meeting and attended the AT&T stockholders’ meeting held at the Shriners building in San Antonio Texas.

While Mr. Whitacre’s leadership was impressive and absolute and while there was a minimum of questions from the audience impacted by a failure to have stockholders’ questions passed to the center aisle for consideration, it should be noted that there were 7 shareholder proposals presented. This is more than ever before and more than is found at a typical Shareholders Meeting. Three of the Seven Proposals dealt with CEO Compensation issues plus a question regarding Director Compensation. This experience reinforced our Association’s view that our strategy to become an ATT shareholder and seek to file Shareholder Proposals is an appropriate process. I believe Mr. Whitacre managed the meeting to minimize any discussion of his compensation package. Please remember that his package was the basis for an article just days before the meeting.

Your President had a brief conversation with Mr. Whitacre and a more comprehensive discussion with Randall Stephenson, ATT COO, and Karen Jennings, Sr Exec VP-HR regarding ATT decision to sustain their current policy on EPR retirees. Basically, Mr. Whitacre deferred the decision to Mr. Stephenson who told me it seemed like a lot of work to permit EPR retirees to bid on ATT Contract Work on the same basis as other ATT Retirees and so he decided not to approve HR’s request for a lifting of the “embargo”.

Dear fellow retiree, I can assure you this is not the last time Mr. Stephenson will hear from me about EPR retiree benefits. Mr. Stephenson is the heir apparent to the CEO position at ATT. He needs to realize he can not perceive retirees in such a cavalier manner. It bordered on being Arbitrary and Capricious.

I found the working session with ATT HR very productive.

Bruce