<PAGE>


                                                                 Exhibit 10.1.38



                               AT&T ADOPTED TERMS


<PAGE>


                                                             Washington Contract


                                     RESALE
                                 AND UNBUNDLING

                                    AGREEMENT

                                     between

                           GTE NORTHWEST INCORPORATED

                                       and

                       AMERICAN TELEPHONE TECHNOLOGY INC.

The filing of this arbitrated Agreement with the Washington Utilities and
Transportation Commission in accordance with the Arbitrator's Report dated
December 11, 1996, the Arbitrator's Supplemental Report dated February 4,1997,
the Decision Maker's Resolution of Contract Language Disputes dated June 2,1997
and the Commission Order Approving Interconnection Agreement effective August
25, 1997 (collectively, the "Order") with respect to AT&T Communications of the
Pacific Northwest, Inc.'s Petition for Arbitration pursuant to Section 252(b) of
the Telecommunications Act of 1996 to establish an interconnection agreement
between AT&T Communications of the Pacific Northwest, Inc. and GTE Northwest
Incorporated, Docket No. UT-960307, does not in any way constitute a waiver by
either AT&T Communications of the Pacific Northwest, Inc. or GTE Northwest
Incorporated, of any right which any such Party may have to appeal to a
competent court of law, or to petition the Washington Utilities and
Transportation Commission for reconsideration of any determination contained in
the Order. or any provision included in this Agreement pursuant to the Order.

In this document the Parties attempt to comply with the Order which directs the
Parties to reduce to contractual language the substantive provisions and
directives of the Order. Nothing contained herein shall be construed or is
intended to be a concession or admission by either Party that any such provision
of the Order or the language herein complies with the duties imposed by the
Telecommunications Act of 1996, the decisions of the FCC and the Washington
Utilities and Transportation Commission, or other law and each Party thus
expressly reserves its full right to assert and pursue claims that the Order
does not comport with applicable law.


<PAGE>

                                                             Washington Contract


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
SECTION                                                                                                            PAGE
-------                                                                                                            -----

<S>                                                                                                                 <C>
PREFACE...............................................................................................................1

AGREEMENT.............................................................................................................1

RECITALS..............................................................................................................1

SCOPE, INTENT AND DEFINITIONS.........................................................................................2

GENERAL TERMS AND CONDITIONS..........................................................................................3

1.   PROVISION OF LOCAL SERVICE UNBUNDLED NETWORK ELEMENTS............................................................3

2.   TERM OF AGREEMENT................................................................................................3

3.   TERMINATION OF AGREEMENT; TRANSITIONAL SUPPORT...................................................................3

4.   GOOD FAITH PERFORMANCE...........................................................................................5

5.   OPTION TO OBTAIN LOCAL SERVICES OR NETWORK ELEMENTS UNDER OTHER AGREEMENTS

6.   RESPONSIBILITY OF EACH PARTY.....................................................................................5

7.   GOVERNMENTAL COMPLIANCE..........................................................................................6

8.   RESPONSIBILITY FOR ENVIRONMENTAL CONTAMINATION...................................................................6

9.   REGULATORY MATTERS...............................................................................................9

10.   LIABILITY AND INDEMNITY........................................................................................10

11.   SERVICE PARITY AND STANDARDS...................................................................................12

12.   CUSTOMER CREDIT HISTORY........................................................................................12

13.   FORCE MAJEURE..................................................................................................13

14.   CERTAIN STATE AND LOCAL TAXES..................................................................................14

15.   ALTERNATIVE DISPUTE RESOLUTION.................................................................................14

16.   NOTICES........................................................................................................15

17.   CONFIDENTIALITY AND PROPRIETARY INFORMATION....................................................................16

18.   BRANDING.......................................................................................................18

19.   DIRECTORY LISTINGS AND DIRECTORY DISTRIBUTION..................................................................19
</TABLE>


<PAGE>

                                                             Washington Contract


<TABLE>
<S>                                                                                                                <C>
20.   DIRECTORY ASSISTANCE LISTING INFORMATION.......................................................................22

21.   BUSY LINE VERIFICATION AND BUSY LINE VERIFICATION INTERRUPT....................................................22

22.   NUMBER ASSIGNMENT..............................................................................................22

23.   MISCELLANEOUS..................................................................................................23

PART I LOCAL SERVICES RESALE.........................................................................................28

24.   TELECOMMUNICATIONS SERVICES PROVIDED FOR RESALE................................................................28

25.   GENERAL TERMS AND CONDITIONS FOR RESALE........................................................................28

26.   REQUIREMENTS FOR SPECIFIC SERVICES.............................................................................30

27.   ADVANCED INTELLIGENT NETWORK...................................................................................32

28.   ROUTING TO DIRECTORY ASSISTANCE, OPERATOR AND REPAIR SERVICES..................................................32

29.   SERVICE SUPPORT FUNCTIONS......................................................................................35

30.   PAY PHONE LINES AND PAY PHONE SERVICES.........................................................................40

PART II:  UNBUNDLED NETWORK ELEMENTS.................................................................................43

31.   INTRODUCTION...................................................................................................43

32.   UNBUNDLED NETWORK ELEMENTS.....................................................................................43

PART III:  ANCILLARY FUNCTIONS.......................................................................................46

33.   INTRODUCTION...................................................................................................46

34.   GTE PROVISION OF ANCILLARY FUNCTIONS...........................................................................46

35.   STANDARDS FOR ANCILLARY FUNCTIONS..............................................................................46

PART IV:  DELETED, INTENTIONALL LEFT BLANK
</TABLE>



ATTACHMENTS

Attachment I  Alternative Dispute Resolution

<PAGE>

                                                             Washington Contract




Attachment 2  Services Description: Unbundled Network Elements ("UNE")

Attachment 3  Service Description: Ancillary Functions

Attachment 4  Provisioning and Ordering - UNE

Attachment 5  Maintenance for Local Services Resale and UNE

Attachment 6  Local Services Resale and UNE Billing and Recording

Attachment 7  Provision of Customer Usage Data

Attachment 8  Local Number Portability

Attachment 9  Network Security

Attachment 10 Acronyms

Attachment 11 Definitions

Attachment 12 Service Quality Standards and Processes

Attachment 13 Electronic Interface for Operations Support Systems

Attachment 14 Pricing

Attachment 15 Reciprocal Compensation For Call Termination Agreement




<PAGE>

                                                                          Page 1



                                     PREFACE

                                    AGREEMENT

     This Agreement is entered into as of the ____ day of ___________ 1997, by
and between American Telephone Technology Inc. having an office at 12668
Interurban Avenue South, Seattle, WA 98168, in its capacity as a certified
provider of local dial-tone service ("ATTI"), and GTE Northwest Incorporated, a
Washington Corporation, having an office for purposes of this Agreement at 600
Hidden Ridge Drive, Irving, Texas 75038 ("GTE"), in its capacity as an incumbent
local exchange carrier. This Agreement covers services only in the state of
Washington (the "State").

                                    RECITALS

         WHEREAS, The Telecommunications Act of 1996 (the "Act") was signed into
law on February 8,1996; and

         WHEREAS, the Act places certain duties and obligations upon, and grants
certain rights to, Telecommunications Carriers, with respect to the
interconnection of their networks, resale of their telecommunications services,
access to their poles, ducts, conduits and rights of way and, in certain cases,
the offering of certain unbundled network elements and physical collocation of
equipment in Local Exchange Carrier premises, and

         WHEREAS, GTE is an Incumbent Local Exchange Carrier; and

         WHEREAS, ATTI is a Telecommunications Carrier and has requested that
GTE negotiate an agreement with ATTI for the provision of Network Elements,
Local Services for resale, collocation and access to poles, ducts, conduits and
rights of way pursuant to the Act and in conformance with GTE's and ATTI's
duties under the Act; and


<PAGE>

                                                                          Page 2


                          SCOPE, INTENT AND DEFINITIONS

This Agreement governs the purchase by ATTI of certain telecommunications
services provided by GTE in its service areas for resale by ATTI ,the purchase
by ATTI of certain unbundled network elements from GTE, the terms and conditions
of the collocation of certain equipment of AT&T in the premises of GTE, the
provision by GTE of access to its poles, conduits and rights of way.

The Parties agree that their entry into this Agreement is without prejudice to
any positions they may have taken previously, or may take in the future, in any
legislative, regulatory, judicial or other public forum addressing any matters,
including matters related to the same types of arrangements covered in this
Agreement.

For purposes of this Agreement, certain terms have been defined in Attachment 11
and elsewhere in this Agreement to encompass meanings that may differ from the
normal connotation of the defined word. A defined word intended to convey its
special meaning is capitalized when used. Unless the context clearly indicates
otherwise, any term defined or used in the singular shall include the plural.
The words "shall" and "will" are used interchangeably throughout this Agreement
and the use of either connotes a mandatory requirement. The use of one or the
other shall not mean a different degree of right or obligation for either Party.
Other terms that are capitalized, and not defined in this Agreement, shall have
the meaning given them in the Act. For convenience of reference only, Attachment
10 provides a list of acronyms used throughout this Agreement.


<PAGE>

                                                                          Page 3


                          GENERAL TERMS AND CONDITIONS

1.       PROVISION OF LOCAL SERVICE AND UNBUNDLED NETWORK ELEMENTS

         This Agreement, which consists of these General Terms and Conditions
         and Attachments 1-15 and their accompanying Appendices, sets forth the
         terms conditions and prices under which GTE agrees to provide (a)
         telecommunications services for resale (hereinafter referred to as
         "Local Services") and (b) certain unbundled Network Elements, Ancillary
         Functions and additional features to ATTI or combinations of such
         Network Elements ("Combinations"), for purposes of offering
         telecommunications services of any kind, including, but not limited to,
         local exchange services, intrastate toll services, and intrastate and
         interstate exchange access services and (c) access to GTE's poles,
         conduits and rights of way. The Network Elements, Combinations or Local
         Services provided pursuant to this Agreement may be connected to other
         Network Elements, Combinations or Local Services provided by GTE or to
         any Network Elements, Combinations or Local Services provided by ATTI
         itself or by any other vendor. Subject to the requirements of this
         Agreement, ATTI may, at any time add or delete the Local Services, or
         Network Elements or Combinations purchased hereunder.

2.       TERM OF AGREEMENT

         This Agreement shall become effective in accordance with Section 23.8
         (the "Effective Date"), and shall remain effective for a period of
         three (3) years. This Agreement shall continue in effect for
         consecutive one (1) year terms thereafter unless either Party gives the
         other Party at least ninety (90) calendar days written notice of
         termination, which termination shall be effective at the end of the
         initial term.


<PAGE>

                                                                          Page 4


3.       TERMINATION OF AGREEMENT; TRANSITIONAL SUPPORT

3.1      Subject to any applicable restrictions and requirements contained
         elsewhere in this Agreement, ATTI may elect at any time to terminate
         this entire Agreement at ATTI's sole discretion, upon ninety (90) days
         prior written notice to GTE. Unless otherwise provided in this
         Agreement, in such case, ATTI's liability shall be limited to payment
         of the amounts due for Local Services, Network Elements, and
         Combinations provided up to and including the date of termination. The
         Parties recognize that provision of uninterrupted service to customers
         is vital and services must be continued without interruption. Upon the
         termination or expiration of this Agreement, ATTI may itself provide or
         retain another vendor to provide comparable Local Services, Network
         Elements, or Combinations. GTE agrees to cooperate in an orderly and
         efficient transition to ATTI or another vendor such that the level and
         quality of the Local Services, Network Elements and Combinations are
         not degraded and to exercise reasonable efforts to assist in an orderly
         and efficient transition.

3.2      ATTI may terminate any Local Service(s), Network Element(s) or
         Combination(s) provided under this Agreement upon thirty (30) days
         written notice to GTE, unless a different notice period or different
         conditions are specified for termination of such Local Service(s),
         Network Element(s) or Combination(s) in this Agreement, in which event
         such specific period and conditions shall apply.

3.3      GTE will not discontinue any unbundled Network Element, Ancillary
         Function or Combination thereof during the term of this Agreement
         without ATTI's written consent which consent shall not be unreasonably
         withheld, except (1) to the extent required by network changes or
         upgrades, in which event GTE will comply with the network disclosure
         requirements stated in the Act and the FCC's implementing regulations;
         or (2) if required by a final order of the Court, the FCC or the
         Commission as a result of remand or appeal of the FCC's order In the
         Matter of Implementation of Local Competition Provisions of the
         Telecommunications Act of 1996, Docket 96-98. In the event such a final
         order allows but does not require discontinuance, GTE shall make a
         proposal for ATTI's approval, and if the Parties are unable to agree,
         either Party may submit the matter to the Dispute resolution procedures
         described in Attachment 1. GTE will not discontinue any Local Service
         or Combination of Local Services without providing 45 days advance
         written notice to ATTI, provided however, that if such services are
         discontinued with less than 45 days notice to the regulatory authority,
         GTE will notify ATTI at the same time it determines to discontinue the
         service. If GTE grandfathers a Local Service or combination of Local
         Services, GTE shall grandfather the service for ATTI resale customers
         who subscribe to the service as of the date of discontinuance.


<PAGE>

                                                                          Page 5


3.4      Either Party may terminate this Agreement at any time by giving written
         notice in writing to the other Party in the event the other Party files
         a petition for bankruptcy, is declared bankrupt, is insolvent, makes an
         assignment for the benefit of creditors, or goes into liquidation or
         receivership. In addition, either Party may terminate this Agreement in
         the event of a Party's refusal or failure to pay all or any portion of
         any amount required to be paid to the other Party as and when due;
         provided however that the Party allegedly due payment (1) notifies the
         other Party of the amounts due, (2) utilizes the ADR process set forth
         in Attachment 1, (3) obtains a favorable final ruling in that process
         and (4) does not receive payment within thirty (30) calendar days of
         the final ruling. There shall be no other reason for the unilateral
         termination of this Agreement.

4.       GOOD FAITH PERFORMANCE

         In the performance of their obligations under this Agreement, the
         Parties shall act in accordance with the good faith requirements of the
         Act. In situations in which notice, consent, approval or similar action
         by a Party is permitted or required by any provision of this Agreement,
         (including, without limitation, the obligation of the Parties to
         further negotiate the resolution of new or open issues under this
         Agreement), such action shall not be unreasonably delayed, withheld or
         conditioned.

5.       SECTION 252(i) ELECTION

         GTE shall allow ATTI to elect terms other than those set forth in this
         Agreement to the extent required by Section 252 of the Act, final
         regulations thereunder and relevant court decisions.

6.       RESPONSIBILITY OF EACH PARTY

         Each Party is an independent contractor, and has and hereby retains the
         right to exercise full control of and supervision over its own
         performance of its obligations under this Agreement and retains full
         control over the employment, direction, compensation and discharge of
         all employees assisting in the performance of such obligations. Each
         Party will be solely responsible for all matters relating to payment of
         such employees, including compliance with social security taxes,
         withholding taxes and all other regulations governing such matters.
         Subject to the limitations on liability contained in this Agreement and
         except as otherwise provided in this Agreement, each Party shall be
         responsible for (i) its own acts and performance of all obligations
         imposed by Applicable Law in connection with its activities, legal
         status and property, real or personal and, (ii) the acts of its own
         affiliates, employees,


<PAGE>

                                                                          Page 6


         agents and contractors during the performance of that Party's
         obligations hereunder.

7.       GOVERNMENTAL COMPLIANCE

         ATTI and GTE each shall comply with all Applicable Law that relates to
         i) its obligations under or activities in connection with this
         Agreement; or ii) its activities undertaken at, in connection with or
         relating to Work Locations. ATTI and GTE each agree to indemnify,
         defend (at the other Party's request) and save harmless the other, each
         of its officers, directors and employees from and against any losses,
         damages, claims, demands, suits, liabilities, fines, penalties and
         expenses (including reasonable attorneys' fees) that arise out of or
         result from its failure or the failure of its contractors or agents to
         so comply. Each Party will be solely responsible for obtaining from
         governmental authorities, building owners, other carriers, and any
         other persons or entities, all rights and privileges which are
         necessary for such Party to perform its obligations under this
         Agreement.

8.       RESPONSIBILITY FOR ENVIRONMENTAL CONTAMINATION

8.1      ATTI shall in no event be liable to GTE for any costs whatsoever
         resulting from the presence of any Environmental Hazard that ATTI did
         not introduce to the affected Work Location or the Release of any
         Environmental Hazard that ATTI did not cause at the affected Work
         Location. GTE shall indemnify, defend (at ATTI's request) and hold
         harmless ATTI T, each of its officers, directors and employees from and
         against any losses, damages, claims, demands, suits, liabilities,
         fines, penalties and expenses (including reasonable attorneys' fees)
         that arise out of or result from (i) any Environmental Hazard that GTE,
         its contractors or agents introduce to the Work Locations or (ii) any
         Environmental Hazard that GTE, its contractors or agents Releases at
         the Work Locations.

         GTE shall in no event be liable to ATTI for any costs whatsoever
         resulting from the presence of any Environmental Hazard that GTE did
         not introduce to the affected Work Location or the Release of any
         Environmental Hazard that GTE did not cause at the affected Work
         Location. ATTI shall indemnify, defend (at GTE's request) and hold
         harmless GTE, each of its officers, directors and employees from and
         against any losses, damages, claims, demands, suits, liabilities,
         fines, penalties and expenses (including reasonable attorney's fees)
         that arise out of or result from (i) any Environmental Hazard that
         ATTI, its contractors or agents introduce to the Work Locations or (ii)
         any Environmental Hazard that ATTl ,its contractor or agents Release at
         the Work Locations.

8.2      GTE and ATTI agree to comply with applicable federal, state and local
         environmental and safety laws and regulations including U.S.
         Environmental


<PAGE>

                                                                          Page 7


         Protection Agency (EPA) regulations issued under the Clean Air Act,
         Clean Water Act, Resource Conservation and Recovery Act, Comprehensive
         Environmental Response, Compensation and Liability Act, Superfund
         Amendments and Reauthorization Act and the Toxic Substances Control Act
         and OSHA regulations issued under the Occupational Safety and Health
         Act of 1970 applicable to their performance under this Agreement. Each
         Party has the responsibility to notify the other if compliance
         inspections occur, and/or citations are issued, at Work Locations that
         impact any aspect of performance under this Agreement or involve
         potential employee exposure.

8.3      GTE shall provide prompt reasonable notice to ATTI of known and
         discovered physical hazards or hazardous chemicals at any portion of an
         affected Work Location which ATTI uses, and ATTI shall provide prompt
         reasonable notice to GTE of known and discovered physical hazards or
         hazardous chemicals at any portion of an affected Work Location which
         ATTI uses. This includes Material Safety Data Sheets (MSDSs), when
         necessary, for materials existing at, or brought on site to, the
         affected Work Location by the party with the obligation to notify the
         other. Each Party is required to provide specific notice for imminent
         danger conditions which could include, but is not limited to. a
         defective utility pole or significant petroleum contamination in a
         manhole.

8.4      ATTI and GTE will make available to each other their respective
         internal environmental control or safety procedures for review in
         planning work at a GTE Work Location. These practices/procedures will
         represent the regular work practices required to be followed by the
         employees and contractors for safety and environmental protection. ATTI
         will follow its practices unless for a specific Work Location or
         emergency procedure, GTE's practice provides a greater degree of safety
         or environmental control.

8.5      Any materials brought to, stored at, or otherwise remaining at a Work
         Location belong to the party which brought the materials to, is storing
         the materials at, or is otherwise causing the materials to remain at
         the Work Location. Both parties have a duty to cooperate with each
         other in introducing new hazardous materials or other new environmental
         hazards at a Work Location to minimize adverse impacts on safety. Each
         party must demonstrate adequate emergency response capabilities for
         materials it uses, stores, or causes to remain at the other party's
         Work Location.

8.6      ATTI agrees to promptly notify GTE of any third-party contamination it
         discovers at a GTE affected Work Location. Notification obligations to
         regulatory authorities shall be the responsibility of GTE to evaluate
         and act upon, unless ATTI is required by applicable law to directly
         report.

8.7      ATTI agrees to obtain and use its own environmental permits, if
         necessary for its performance under this Agreement. If GTE's permit or
         EPA identification

<PAGE>

                                                                          Page 8


         number must be used, ATTI must comply with applicable GTE environmental
         procedures, including environmental "best management practices ("BMP")
         and/or selection of disposition vendors and disposal sites to the
         extent provided by GTE. In the event that ATTI must use GTE's vendors
         for waste disposal, GTE assumes all liability for such materials, and
         GTE agrees to indemnify ATTI for any and all claims that may arise from
         such waste disposal.

8.8      ATTI visitors must comply with GTE security, fire safety, safety,
         environmental and building practices/codes including equivalent
         employee training when working in GTE Work Locations, to the extent
         provided by GTE. GTE will, to the extent possible, supply such
         practices/codes to ATTI prior to ATTI's first entry into the Work
         Location.

8.9      GTE and ATTI shall coordinate plans or information required to be
         submitted to government agencies, such as emergency response plans and
         community reporting if applicable to their performance under this
         Agreement. If fees are associated with any required filing, GTE and
         ATTI will develop a cost sharing procedure. GTE and ATTl will determine
         for each Work Location which party has the lead responsibility for such
         filings and coordination.

8.10     Activities impacting safety or the environment of a Right of Way must
         be harmonized with the specific agreement and the relationship between
         GTE and the private land owner. This may include limitations on
         equipment access due to environmental conditions (e.g., wetland area
         with equipment restrictions).

8.11     For the purposes of this Section 8 only, the following terms have the
         meanings set forth in this subsection 8.11:

         hazardous chemical: Means any chemical which is a health hazard or
         physical hazard as defined in the U.S. Occupational Safety and Health
         (OSHA) hazard communication standard (29 CFR 1910.1200).

         third party contamination: Environmental pollution that is not
         generated by the LEC or CLEC but results from off-site activities
         impacting an affected Work Location.

8.12     SPILL AND RELEASE NOTIFICATIONS

         GTE and ATTI shall promptly notify the other of any spill or release of
         a Regulated Material at the facility. GTE's obligation under this
         Section is limited to those spills or releases likely to impact the
         portion of the facility used by ATTI, or any portion of the facility
         where ATTI personnel are reasonably expected to be present. ATTI shall
         be responsible for reporting any spill or release of a Regulated
         Material occurring as part of or in connection with its operations that
         must be reported to any

<PAGE>

                                                                          Page 9


         regulatory authority. ATTI will consult with GTE prior to making such
         report, unless the time required for prior consultation would preclude
         ATTI from complying with the applicable reporting requirement.

8.13     MANAGEMENT OF MANHOLE OR VAULT WATER

         When conducting operations in any GTE manhole or vault area, ATTI shall
         follow the ATTI or GTE practice/procedure that provides the greatest
         degree of environmental control in evaluating and managing any water
         present in the manhole or vault area. ATTI shall be responsible for
         obtaining any permit or other regulatory approval necessary for any of
         its operations involving the evaluation, collection, discharge,
         storage, disposal, or other management of water present in a GTE
         manhole or vault area. GTE shall not be responsible for any costs
         incurred by ATTI in meeting its obligations under this Section unless
         GTE placed or otherwise caused materials or substances to be present in
         the manhole or vault area.

9.       REGULATORY MATTERS

9.1      GTE shall be responsible for obtaining and keeping in effect all FCC,
         state regulatory commission, franchise authority and other regulatory
         approvals that may be required in connection with the performance of
         its obligations under this Agreement. ATTI shall be responsible for
         obtaining and keeping in effect all FCC, state regulatory commission,
         franchise authority and other regulatory approvals that may be required
         in connection with its offering of services to ATTI Customers
         contemplated by this Agreement. ATTI shall reasonably cooperate with
         GTE in obtaining and maintaining any required approvals for which GTE
         is responsible, and GTE shall reasonably cooperate with ATTI in
         obtaining and maintaining any required approvals for which ATTI is
         responsible.

9.2      Nothing in this Agreement shall be construed to deny either Party the
         right to file tariffs from time to time in the normal course of
         business. If GTE files a tariff that changes the price, term or other
         condition of a retail service offered for resale under Section 24
         hereunder, such tariff change shall apply to modify the appropriate
         price, term or condition of such retail service under this Agreement.
         In the case of tariff changes affecting other prices, terms or
         conditions of this Agreement other than retail services offered for
         resale, the Commission shall determine on a case by case basis whether
         any such tariff change will apply to modify the relevant price, term or
         condition of this Agreement.

9.3      If any effective legislative, regulatory, judicial or other legal
         actions, including a change in Applicable Law, materially affects any
         material terms of this Agreement, or the ability of ATTI or GTE to
         perform any material terms of this


<PAGE>

                                                                         Page 10


         Agreement, ATTI or GTE may, on thirty (30) days written notice
         (delivered not later than 30 days following the date on which such
         action has become effective) request that such term(s) be renegotiated,
         and the parties agree to so negotiate in good faith such mutually
         acceptable new term(s). If agreement is not achieved within thirty (30)
         days, either party may request mediation, in which case the parties
         shall submit to voluntary mediation.

10.      LIABILITY AND INDEMNITY

10.1     LIABILITIES OF AT&T - ATTI's `s liability to GTE during any Contract
         Year resulting from any and all causes under this Agreement, other than
         as specified in Sections 7, 8,10.3 and 10.4 below, shall not exceed an
         amount equal to the amount due and owing by ATTI to GTE under this
         Agreement during the Contract Year in which such cause accrues or
         arises.

10.2     LIABILITIES OF GTE - GTE's liability to ATTI during any Contract Year
         resulting from any and all causes under this Agreement, other than as
         specified in Sections 7, 8 and 10.4 below, shall not exceed an amount
         equal to any amounts due and owing by ATTI to GTE under this Agreement
         during the Contract Year in which such cause accrues or arises.

10.3     NO CONSEQUENTIAL DAMAGES - NEITHER ATTI NOR GTE SHALL BE LIABLE TO THE
         OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, RELIANCE, OR
         SPECIAL DAMAGES SUFFERED BY SUCH OTHER PARTY (INCLUDING WITHOUT
         LIMITATION DAMAGES FOR HARM TO BUSINESS, LOST REVENUES, LOST SAVINGS,
         OR LOST PROFITS SUFFERED BY SUCH OTHER PARTIES), REGARDLESS OF THE FORM
         OF ACTION, WHETHER IN CONTRACT, WARRANTY, STRICT LIABILITY, OR TORT,
         INCLUDING WITHOUT LIMITATION NEGLIGENCE OF ANY KIND WHETHER ACTIVE OR
         PASSIVE, AND REGARDLESS OF WHETHER THE PARTIES KNEW OF THE POSSIBILITY
         THAT SUCH DAMAGES COULD RESULT. EACH PARTY HEREBY RELEASES THE OTHER
         PARTY AND SUCH OTHER PARTY'S SUBSIDIARIES AND AFFILIATES, AND THEIR
         RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS FROM ANY SUCH
         CLAIM.

10.4     OBLIGATION TO INDEMNIFY

         Each Party shall, and hereby agrees to, defend at the other's request,
         indemnify and hold harmless the other Party and each of its officers,
         directors, employees and agents (each, an "Indemnitee") against and in
         respect of any loss, debt, liability, damage, obligation, claim,
         demand, judgment or settlement or any nature or kind, known or unknown,
         liquidated or unliquidated, including without limitation all reasonable
         costs and expenses incurred (legal, accounting or otherwise)
         (collectively, "Damages") arising out of, resulting from or based upon
         any pending or threatened claim, action, proceeding or


<PAGE>

                                                                         Page 11


         suit by any third party (a "Claim"): (i) based upon injuries or damage
         to any person or property or the environment arising out of or in
         connection with this Agreement, that are the result of such
         Indemnifying Party's actions, breach of Applicable Law, or breach of
         representations, warranties or covenants made in this Agreement, or the
         actions, breach of Applicable Law or of this Agreement by its officers,
         directors, employees, agents and subcontractors, or (ii) for actual or
         alleged infringement of any patent, copyright, trademark, service mark,
         trade name, trade dress, trade secret or any other intellectual
         property right now known or later developed (referred to as
         "Intellectual Property Rights") to the extent that such claim or action
         arises from the Indemnifying Party's or the Indemnifying Party's
         Customer's use of the Network Elements, Ancillary Functions,
         Combinations, Local Services or other services provided under this
         Agreement.

10.5     OBLIGATION TO DEFEND; NOTICE; CO-OPERATION - Whenever a Claim shall
         arise for indemnification under this Agreement, the relevant
         Indemnitee, as appropriate, shall promptly notify the Indemnifying
         Party and request the Indemnifying Party to defend the same. Failure to
         so notify the Indemnifying Party shall not relieve the Indemnifying
         Party of any liability that the Indemnifying Party might have, except
         to the extent that such failure prejudices the Indemnifying Party's
         ability to defend such Claim. The Indemnifying Party shall have the
         right to defend against such liability or assertion in which event the
         Indemnifying Party shall give written notice to the Indemnitee of
         acceptance of the defense of such Claim and the identity of counsel
         selected by the Indemnifying Party. Except as set forth below, such
         notice to the relevant Indemnitee shall give the Indemnifying Party
         full authority to defend, adjust, compromise or settle such Claim with
         respect to which such notice shall have been given, except to the
         extent that any compromise or settlement shall prejudice the
         Intellectual Property Rights of the relevant Indemnitees. The
         Indemnifying Party shall consult with the relevant Indemnitee prior to
         any compromise or settlement that would affect the Intellectual
         Property Rights of any Indemnitee, and the relevant Indemnitee shall
         have the right to refuse such compromise or settlement and at the
         refusing Party's or refusing Parties' cost, to take over such defense,
         provided that in such event the Indemnifying Party shall not be
         responsible for, nor shall it be obligated to indemnify the relevant
         Indemnitee against, any cost or liability in excess of such refused
         compromise or settlement. With respect to any defense accepted by the
         Indemnifying Party, the relevant Indemnitee shall be entitled to
         participate with the Indemnifying Party in such defense to the extent
         the Claim requests equitable relief or other relief that could affect
         the rights of the Indemnitee and also shall be entitled to employ
         separate counsel for such defense at such Indemnitee's expense. - In
         the event the Indemnifying Party does not accept the defense of any
         indemnified Claim as provided above, the relevant Indemnitee shall have
         the right to


<PAGE>

                                                                         Page 12


         employ counsel for such defense at the expense of the Indemnifying
         Party. Each Party agrees to cooperate and to cause its employees and
         agents to cooperate with the other Party in the defense of any such
         Claim and the relevant records of each Party shall be available to the
         other Party with respect to any such defense.

11.      SERVICE PARITY AND STANDARDS

11.1     Notwithstanding anything in this Agreement to the contrary, GTE shall
         meet any service standard imposed by the FCC or by any state regulatory
         authority for any Local Services, Unbundled Network Elements, and
         Ancillary Functions provided by GTE to ATTI for resale.

11.2     GTE shall ensure that the quality of Local Services, network elements
         and ancillary functions, provided to ATTI are at least equal in quality
         to that provided by GTE to itself.

11.3     GTE and ATTI agree to implement standards to measure the quality of the
         Local Services and Unbundled Network Elements supplied by GTE, in
         particular with respect to pre-ordering, ordering/provisioning,
         maintenance and billing. These quality standards are described in
         Attachment 12. In the event of a violation of Quality Standards by
         either Party, which the Complaining Party alleges constitutes a breach
         of this Agreement, the Complaining Party may elect, subject to the
         procedures set forth in Attachment 1, either (1) to seek such money
         damages as may be available at law; or (2) to claim the penalties
         specified in Attachment 12, but the Complaining Party may not seek both
         (1) and (2) based on the same alleged breach; provided, however, that
         nothing in this sentence shall prevent the Complaining Party from
         seeking equitable relief at the same time that it pursues a claim for
         money damages or a claim under Attachment 12.

11.4     [Intentionally Left Blank]

11.5     If ATTI requests a standard higher than GTE provides to itself, such
         request shall be made as a Bona Fide Request pursuant to Attachment 12,
         and GTE may provide such standard to the extent technically feasible.
         ATTI shall pay the incremental cost of such higher standard or other
         measurement of quality.

12.      CUSTOMER CREDIT HISTORY

12.1     ATTI and GTE agree to make available to a designated third-party credit
         bureau, on a timely basis, such of the following customer payment
         history information that is available solely from internal business
         records of the providing Party for each person or entity that applies
         for local or IntraLATA toll Telecommunications Service(s) from either
         carrier. Such information shall be


<PAGE>

                                                                         Page 13


         provided on the condition that the credit bureau will only make such
         information available to the carrier to which the person or entity in
         question has applied for Telecommunication Service.

                       Applicants name;
                       Applicant's address;
                       Applicant's previous phone number; if any; Amount, if
                       any, of unpaid balance in applicant's name; Whether
                       applicant is delinquent on payments; Length of service
                       with prior local or IntraLATA toll provider;

                       Whether applicant had local or IntraLATA toll service
                       terminated or suspended within the last six months with
                       an explanation of the reason therefor; and Whether
                       applicant was required by prior local or IntraLATA toll
                       provider to pay a deposit or make an advance payment,
                       including the amount of each.

         Nothing contained herein shall require either Party to undertake
         obligations which would subject that Party to requirements or
         liabilities as a consumer reporting agency under 15 U.S.C. Section 1681
         et seq. and its implementing regulations or any similar statute, order
         or administrative rule of the State.

12.2     COOPERATION ON FRAUD MINIMIZATION - The Parties shall cooperate with
         one another to investigate, minimize and take corrective action in
         cases of fraud. The Parties' fraud minimization procedures are to be
         cost effective and implemented so as not to unreasonably burden or harm
         one Party as compared to the other. At a minimum, such cooperation
         shall include, when permitted by law or regulation, providing the other
         Party, upon reasonable request, information concerning end users who
         terminate services to that Party without paying all outstanding
         charges, when that Party is notified that such end user seeks service
         from the other Party. If required, it shall be the responsibility of
         the Party seeking the information to secure the end user's permission
         (in the format required by law) to obtain the information. Although in
         most circumstances the end user's current telephone number may be
         retained by the end user when switching local service providers, if an
         end user has past due charges associated with the account, for which
         payment arrangements have not been made with one Party, the end user's
         previous telephone number will not be made available to the other Party
         until the end user's outstanding balance has been paid.

13.      FORCE MAJEURE

13.1     Except as otherwise specifically provided in this Agreement, neither
         Party shall be liable for any delay or failure in performance of any
         part of this Agreement caused by any condition beyond the reasonable
         control of the


<PAGE>

                                                                         Page 14


         Party claiming excusable delay or other failure to perform, including
         acts of the United States of America or any state, territory or
         political subdivision thereof, acts of God or a public enemy, fires,
         floods, freight embargoes, earthquakes, volcanic actions, wars, or
         civil disturbances. If any Force Majeure condition occurs, the Party
         whose performance fails or is delayed because of such Force Majeure
         condition shall give prompt notice to the other Party, and upon
         cessation of such Force Majeure condition, shall give like notice and
         commence performance hereunder as promptly as reasonably practicable,
         including implementation of disaster recovery plans.

13.2     Notwithstanding subsection 1, preceding, no delay or other failure to
         perform shall be excused pursuant to this Section:

         (i) by the acts or omission of a Party's subcontractors, material men,
         suppliers or other third persons providing products or services to such
         Party unless such acts or omissions are themselves the product of a
         Force Majeure condition, and
         (ii) unless such delay or failure and the consequences thereof are
         beyond the reasonable control and without the fault or negligence of
         the Party claiming excusable delay or other failure to perform.

14.      CERTAIN STATE AND LOCAL TAXES

         Any state or local excise, sales, or use taxes (excluding any taxes
         levied on income) resulting from the performance of this Agreement
         shall be borne by the Party upon which the obligation for payment is
         imposed under applicable law, even if the obligation to collect and
         remit such taxes is placed upon the other Party. The collecting Party
         shall charge and collect from the obligated Party, and the obligated
         Party agrees to pay to the collecting Party, all applicable taxes,
         except to the extent that the obligated Party notifies the collecting
         Party and provides to the collecting Party appropriate documentation
         that qualifies the obligated Party for a full or partial exemption. Any
         such taxes shall be shown as separate items on applicable billing
         documents between the Parties. The obligated Party may contest the same
         in good faith, at its own expense, and shall be entitled to the benefit
         of any refund or recovery, provided that such Party shall not permit
         any lien to exist on any asset of the other Party by reason of the
         contest. The collecting Party shall cooperate in any such contest by
         the other Party, provided that the contesting Party shall pay the
         reasonable expenses of the collecting Party for any such cooperative
         activities.

15.      ALTERNATIVE DISPUTE RESOLUTION

         All Disputes arising under this Agreement or the breach hereof, except
         those arising pursuant to Attachment 6, Connectivity Billing, shall be
         resolved according to the procedures set forth in Attachment 1.
         Disputes involving


<PAGE>

                                                                         Page 15


         matters subject to the Connectivity Billing provisions contained in
         Attachment 6, shall be resolved in accordance with the Billing Disputes
         section of Attachment 6. In no event shall the Parties permit the
         pendency of a Dispute to disrupt service to any customer of any Party
         contemplated by this Agreement except in the case of default and
         termination of this Agreement pursuant to Section 3.4. The foregoing
         notwithstanding, neither this Section 15 nor Attachment 1 shall be
         construed to prevent either Party from seeking and obtaining temporary
         equitable remedies, including temporary restraining orders.

16.      NOTICES

         Any notices or other communications required or permitted to be given
         or delivered under this Agreement shall be in hard-copy writing (unless
         otherwise specifically provided herein) and shall be sufficiently given
         if delivered personally or delivered by prepaid overnight express
         service or certified mail, return receipt requested or by facsimile
         (followed by a hard copy delivered by U.S. Mail or another method
         specified herein) to the following (unless otherwise specifically
         required by this Agreement to be delivered to another representative or
         point of contact):

         If to ATTI:

         Richard A. Smith
         Chief Operating Officer
         730 Second Avenue South
         Suite 1200
         Minneapolis, MN 55402

         If to GTE:

         Lida Tong
         State Director - External Affairs
         GTE Northwest Incorporated
         1800 41st Street
         MC:    WA0101RA
         Everett, WA 98201
         Facsimile number: 206-261-5262

         and

         Thomas R. Parker, Esq.
         Assistant Vice President and Associate General Counsel
         HQ E03J43
         600 Hidden Ridge Drive


<PAGE>

                                                                         Page 16


         Irving, TX 75038
         Facsimile Number: 972-718-1250

         Either Party may unilaterally change its designated representative
         and/or address for the receipt of notices by giving seven (7) days'
         prior written notice to the other Party in compliance with this
         Section. Any notice or other communication shall be deemed given when
         received.

17.      CONFIDENTIALITY AND PROPRIETARY INFORMATION

17.1     For the purposes of this Agreement, "Confidential Information" means
         confidential or proprietary technical or business information, in
         written or tangible form, given by the Discloser to the Recipient that
         is stamped, labeled, or otherwise designated as "Proprietary" or
         "Confidential" or that contains other words or symbols clearly
         indicating that the information is intended to be secure from public
         disclosure. "Confidential Information" also includes information that
         is intentionally provided or disclosed orally or visually if it is
         identified as proprietary or confidential when provided or disclosed
         and is summarized in a writing so marked and delivered within ten (10)
         days following such disclosure. "Confidential Information" also
         includes information that is observed or learned by one Party while it
         is on the premises (including leased collocation space) of the other
         Party. Notwithstanding the foregoing, all orders for Local Services,
         Network Elements or Combinations placed by ATTI pursuant to this
         Agreement, and information that would constitute Customer Proprietary
         Network Information of ATTI Customers pursuant to the Act and the rules
         and regulations of the FCC and Recorded Usage Data as described in
         Attachment 7, whether disclosed by ATTI to GTE or otherwise acquired by
         GTE in the course of the performance of this Agreement, shall be deemed
         Confidential Information of ATTI for all purposes under this Agreement
         whether or not specifically marked or designated as confidential or
         proprietary.

17.2     For the period set forth in Section 17.6, except as otherwise specified
         in this Agreement, the Recipient agrees (a) to use it only for the
         purpose of performing under this Agreement, (b) to hold it in
         confidence and disclose it to no one other than its employees or agents
         or consultants having a need to know for the purpose of performing
         under this Agreement, and (c) to safeguard it from unauthorized use or
         disclosure with at least the same degree of care with which the
         Recipient safeguards its own Confidential Information. Any agent or
         consultant must have executed a written agreement of non-disclosure and
         non-use comparable in scope to the terms of this Section 17 which
         agreement shall be enforceable by the Discloser.


<PAGE>

                                                                         Page 17


17.3     The Recipient may make copies of Confidential Information only as
         reasonably necessary to perform its obligations under this Agreement.
         All such copies shall be subject to the same restrictions and
         protections as the original and shall bear the same copyright and
         proprietary rights notices as are contained on the original.

17.4     The Recipient agrees to return to the Discloser all Confidential
         Information received in tangible form from the Discloser, including any
         copies made by the Recipient, within thirty (30) days after a written
         request is delivered to the Recipient, or to destroy or erase all such
         Confidential Information and certify as to such event, except for
         Confidential Information that the Recipient reasonably requires to
         perform its obligations under this Agreement or as otherwise required
         by applicable law. If either Party loses or makes an unauthorized
         disclosure of the other Party's Confidential Information, it shall
         notify such other Party as soon as is reasonably practicable after the
         loss is discovered and use reasonable efforts to retrieve the lost or
         wrongfully disclosed information.

17.5     The Recipient shall have no obligation to safeguard Confidential
         Information: (a) which was in the possession of the Recipient free of
         restriction on use or disclosure prior to its receipt from the
         Discloser; (b) after it becomes publicly known or available through no
         breach of this Agreement or other restriction on use or disclosure by
         the Recipient; (c) after it is rightfully acquired by the Recipient
         free of restrictions on its use or disclosure; or (d) after it is
         proven to be independently developed by personnel of the Recipient to
         whom the Discloser's Confidential Information had not been previously
         disclosed. In addition, either Party shall have the right to disclose
         Confidential Information to any mediator, arbitrator, state or federal
         regulatory body, the Department of Justice or any court in the conduct
         of any mediation, arbitration or approval of this Agreement subject to
         the requirements concerning notice and other measures specified in the
         last sentence of this Subsection. Additionally, the Recipient may
         disclose Confidential Information if so required by law, a court of
         competent jurisdiction, or governmental or administrative agency, so
         long as the Discloser has been notified of the requirement promptly
         after the Recipient becomes aware of the requirement, but prior to such
         disclosure and so long as the Recipient undertakes all lawful measures
         to avoid disclosing such information until Discloser has had reasonable
         time to seek a protective order and Discloser complies with any
         protective order that covers the Confidential Information to be
         disclosed.

17.6     Each Party's obligations with respect to Confidential Information
         disclosed prior to expiration or termination of this Agreement shall
         expire three (3) years from the date of receipt of the initial
         disclosure, regardless of any termination of this Agreement prior to
         such expiration date; provided that the duties with


<PAGE>

                                                                         Page 18


         respect to Confidential Information that is software, protocols and
         interfaces shall expire fifteen (15) years from the date of the initial
         disclosure.

17.7     Except as otherwise expressly provided elsewhere in this Agreement, no
         license is hereby granted under any patent, trademark, copyright or
         other Intellectual Property Right, nor is any such license implied,
         solely by virtue of the disclosure of any Confidential Information.

17.8     Each Party agrees that the Discloser would be irreparably injured by a
         breach of this Agreement by the Recipient or its representatives and
         that the Discloser shall be entitled to seek equitable relief,
         including injunctive relief and specific performance, in the event of
         any breach of the provisions of this Section 17. Such remedies shall
         not be deemed to be the exclusive remedies for a breach of this Section
         17, but shall be in addition to all other remedies available at law or
         in equity.

18.      BRANDING

18.1     ATTI may, at its option, use the Network Elements, Combinations and
         Local Services provided in accordance with this Agreement to provide to
         its customers services branded as ATTI. Except as otherwise provided in
         this Agreement or specified in a separate writing by ATTI, ATTI shall
         provide the exclusive interface to ATTI Customers in connection with
         the marketing or offering of ATTI services. When a GTE technical
         representative goes to a customer premise on behalf of ATTI, in the
         event the representative has contact with the customer, the
         representative will indicate to the customer that he or she works for
         GTE but is at the customer premise on behalf of ATTI regarding ATTI
         service. If the customer is not at the premise at the time that the
         technical representative is at the premise, GTE agrees to deliver
         generic material or documents to the customer, and the representative
         will write ATTI's name on the document or material left for the
         customer. GTE personnel acting on behalf of ATTI will not discuss,
         provide, or leave information or material relative to GTE's services
         and products.

18.2     Operator Services and Directory Assistance provided by GTE to ATTI
         local service customers under this Agreement will be branded
         exclusively as ATTI services, where technically feasible. GTE will
         perform the necessary software upgrades to allow for rebranding of its
         Operator Services and Directory Assistance in ATTI's name on a switch
         by switch basis, subject to capability and capacity limitations; until
         those upgrades have been completed, GTE will provide rebranded services
         through alternate means to the extent technically feasible. Where it is
         not technically feasible for GTE to provide Operator Services and
         Directory Assistance as rebranded services, then GTE will provide such
         services without any branding, if allowed by state laws and
         regulations. Live operators handling Operator Services and Directory


<PAGE>

                                                                         Page 19


         Assistance calls from ATTI local service customers will identify
         themselves as ATTI operators: where such rebranding is not technically
         feasible, live operator response will be provided on an unbranded
         basis.

19.      DIRECTORY LISTINGS AND DIRECTORY DISTRIBUTION

         GTE shall offer the following to AT&T:

19.1     DIRECTORY LISTINGS (WHITE PAGES) - A basic listing for each ATTI
         Customer shall be included in the GTE white pages directory for such
         ATTI Customer's specific geographic area at no charge to ATTI or ATTI's
         Customers. Where an ATTI Customer has two numbers for a line due to the
         implementation of interim Local Number Portability, the second number
         shall be considered part of the White pages basic listing. Other
         listings that are made available to GTE Customers (e.g. additional
         listings, non-published status, foreign listings, etc.,) will be made
         available to ATTI Customers on the same rates, terms and conditions as
         available to GTE Customers. ATTI Customer Government listings will be
         listed in the same manner as GTE Customer Government listings.

19.2     DIRECTORY LISTINGS (YELLOW PAGES) GTE will provide ATTI Customers with
         the same yellow page services on the same terms and conditions as those
         provided to GTE Customers. GTE will provide each ATTI Customer within
         the geographical area covered by the yellow pages directory a basic
         listing in GTE "yellow pages" under the classified heading that most
         accurately reflects the primary nature of the ATTI Customer's business
         at no charge to ATTI or ATTI Customers for this listing. GTE will
         supply ATTI with a list of authorized classified headings and will
         notify ATTI of any changes to such headings. ATTI agrees to supply GTE,
         on a regularly scheduled basis and in the format mutually agreed
         between ATTI and GTE, with a classified heading assignment for each
         ATTI Customer who wishes to receive this listing. GTE shall provide
         ATTI with monthly schedules (for a rolling twelve (12) month period)
         for Yellow Pages publications in the State.

19.3     LISTING INFORMATION - ATTI agrees to supply GTE, on a regularly
         scheduled basis and in the format mutually agreed between ATTI and GTE,
         all listing information for ATTI Customers who wish to be listed in the
         white or yellow pages of the GTE published directory for that
         subscriber area. Listing information will consist of names, addresses
         (including city and ZIP code where provided in that directory) and
         telephone numbers. GTE shall employ the listing information for the
         production of GTE-published white and yellow page directories. Listing
         inclusion in a given directory will be in accordance with directory
         configuration, scope and schedules established by GTE which are
         applicable to all GTE entities. GTE shall obtain ATTI' prior written
         approval for the use of ATTl Customers' listings for any other purpose.
         GTE


<PAGE>

                                                                         Page 20


         will not sell or license, nor allow any third party, the use of ATTI
         subscriber listing and GTE will not disclose non-listed name or address
         information for any purpose without the prior written consent of ATTI,
         which shall not be unreasonably withheld. GTE will charge ATTI a
         reasonable service bureau extraction fee for all third party
         translations and ATTI will be free to establish its own fees for direct
         billing the third parties.

19.4     DIRECTORY DISTRIBUTION - Initial directories will be provided to ATTI
         Customers for each ATTI Customer's specific geographic region on the
         same basis as GTE Customers within the same directory area. More
         specifically, GTE will not charge ATTI or ATTI Customers for annual
         distribution of directories. GTE will provide secondary distributions
         of directories (e.g. a new customer, requests for additional copies) to
         ATTI Customers at the same price that GTE is charged for secondary
         distribution by GTE Directories. ATTI shall pay GTE Directories for
         such secondary distributions based on GTE's agreement that the
         secondary distribution costs will be excluded from GTE's cost studies
         and resulting avoided cost discounts and prices for unbundled elements.
         Timing of such delivery and the determination of which Telephone
         Directories shall be delivered (by customer address, NPA/NXX or other
         criteria), and the number of Telephone Directories to be provided per
         customer, shall be provided under the same terms that GTE delivers
         Telephone Directories to GTE Customers. ATTI will supply GTE in a
         timely manner with all required subscriber mailing information,
         including non-listed and non-published subscriber mailing information,
         to enable GTE to perform its distribution responsibilities.

19.5     CRITICAL CUSTOMER CONTACT INFORMATION - GTE will list in the
         information pages of its directories at no charge to ATTI, ATTI's
         critical customer contact information for business and residential
         customers regarding emergency services, billing, sales and service
         information, repair service and ATTI's logo. GTE shall list Competitive
         Local Exchange Carrier critical customer contact information on an
         alphabetical basis.

19.6     GTE shall also include, in the customer call guide page(s) of each
         Telephone Directory, up to four full pages of consolidated space for
         the inclusion of information about ATTI products and services,
         including addresses and telephone numbers for AT&T customer service.
         The form and content of such customer information shall be provided by
         ATTI to GTE and shall be subject to GTE review and approval, which
         approval shall not be unreasonably withheld. ATTI agrees to pay a price
         per page to be determined by GTE Directories, provided that such price
         shall be nondiscriminatory to GTE and ATTI.

19.7     GTE shall, at no charge to ATTI, make available recycling services for
         Telephone Directories to ATTI Customers under the same terms and


<PAGE>

                                                                         Page 21


         conditions that GTE makes such services available to its own local
         service customers.

19.8     Notwithstanding anything to the contrary contained herein, GTE may
         terminate this Section 19 as to a specific GTE exchange in the event
         that GTE sells or otherwise transfers the exchange to an entity other
         than a GTE Affiliate. GTE shall provide ATTI with at least ninety (90)
         days' prior written notice of such termination, which shall be
         effective on the date specified in the notice. Notwithstanding
         termination as to a specific exchange, this Section 19 shall remain in
         full force and effect in the remaining exchanges.

19.9     Notwithstanding the termination of this Section 19, the Parties'
         obligations with respect to any directories whose annual publication
         cycle has begun prior to the effective date of termination shall
         survive such termination. For example, if a Party terminates this
         Section 19 effective as of June 30, 1997, the Parties' survival
         obligations shall apply as follows:

<TABLE>
<CAPTION>
            Exchange                       Beginning of                       Expiration of Obligations
                                           Publication Cycle

            <S>                            <C>                                <C>
            1                              January 1,1997                     December 31, 1997
            2                              June 1,1997                        May 31,1998
            3                              August 1,1997                      June 30, 1997
</TABLE>

         a publication cycle begins the day following the listing activity close
         date for the current year's publication.

19.10    Directory Listing criteria shall be specified by GTE. GTE shall provide
         any changes to its Directory Listing Criteria thirty (30) days in
         advance of such changes becoming effective. The Directory Listing
         criteria shall include:

19.10.1  Classified heading information

19.10.2  Rules for White Pages and Yellow Pages listings (e.g., eligibility for
         free Yellow Pages listing, space restrictions, unlisted and unpublished
         listings, abbreviated listings, foreign listings, and heading
         requirements);

19.10.3  Identification of Enhanced White Pages and Enhanced Yellow Pages
         listings available;

19.10.4  Publication schedules for White Pages and Yellow Pages;

19.10.5  Identification of which Telephone Directories are provided to which
         customers by customer address, NPA/NXX or other criteria;

19.10.6  Telephone Directory delivery schedules;


<PAGE>

                                                                         Page 22


19.10.7  Restrictions, if any, on number of Telephone Directories provided at no
         charge to customer;

19.10.8  Processes and terms and conditions for obtaining foreign Telephone
         Directories from GTE; and

19.10.9  Geographic coverage areas of each Telephone (by municipality and
         NPA/NXX).

20.      DIRECTORY ASSISTANCE LISTING INFORMATION

20.1     GTE shall include in its directory assistance database all directory
         assistance listing information, which consists of name and address ("DA
         Listing Information") for all ATTI Customers, including those with
         nonpublished and unlisted numbers, at no charge to ATTI.

         GTE shall provide to ATTI, at ATTI's request, for purposes of ATTI
         providing ATTI-branded directory assistance services to its local
         customers, within thirty (30) days after the Effective Date, all
         published GTE DA Listing Information via magnetic tape delivered within
         twenty-four (24) hours of preparation, at a the rate specified in
         Attachment 14. Changes to the DA Listing Information shall be updated
         on a daily basis through the same means used to transmit the initial
         list. DA Listing Information provided shall indicate whether the
         customer is a residence or business customer.

20.2     Neither Party will release, sell, or license DA Listing Information
         that includes the other Party's end user information to third parties
         without the other Party's approval. The other Party shall inform the
         releasing Party if it desires to have the releasing Party provide the
         other Party's DA Listing Information to the third party, in which case,
         the releasing Party shall provide the other Party's DA Listing
         Information at the same time as the releasing Party provides the
         releasing Party's DA Listing Information to the third party. The rate
         to be paid by the releasing Party to the other Party for such sales
         shall be negotiated on a case-by-case basis.

21.      BUSY LINE VERIFICATION AND BUSY LINE VERIFICATION INTERRUPT

         Prior to the exchange of traffic under this Agreement, each Party shall
         establish procedures whereby its operator bureau will coordinate with
         the operator bureau of the other Party to provide Busy Line
         Verification ("BLV") and Busy Line Verification Interrupt ("BLVI")
         services on calls between their respective end users. Each Party shall
         route BLV and BLVI inquiries over separate inward operator services
         trunks. Each Party's operator assistance bureau will only verify and/or
         interrupt the call and will not complete the call of the end-user
         initiating the BLV or BLVI. Each Party shall charge the other for the
         BLV and BLVI services on a bill-and-keep basis.


<PAGE>

                                                                         Page 23


22.      NUMBER ASSIGNMENT

22.1     GTE shall allocate Central Office Codes, i.e. NXXs, in a neutral manner
         at parity with itself in those LATAs where GTE is the number
         administrator. GTE shall not charge a fee for the allocation of NXXs to
         AT&T for any costs including, but not limited to, programming expenses
         incurred by GTE in their role as number administrator; provided,
         however, that when responsibility for number assignment is transferred
         to a neutral third party, GTE shall charge a fee for such services to
         recover costs incurred that is consistent with the applicable rules and
         regulations for such.

22.2     GTE shall process all ATTI NXX requests in a timely manner as per the
         ICCF Code Assignment Guidelines and will provide numbers in any NPA/NXX
         associated with a terminating line within the boundaries of an LSO, in
         those LATAs where GTE is the number administrator.

22.3     GTE, during the interim period, will maintain its current process of
         notifying public utility commissions and state regulatory bodies of
         plans for NPA splits and code relief.

22.4     GTE shall treat as confidential, and solely for use in its role as Code
         Administrator and for no other purpose, any and all information
         received from ATTI regarding NPA/NXX forecasts. This information shall
         be used only for the purposes of code administration, e.g. NPA code
         relief studies.

22.5     GTE shall participate in the transition of its code administration
         responsibilities to a neutral third party and will notify ATTI if there
         are not sufficient numbers to meet the forecasted requirements of ATTI.

22.6     GTE shall provide ATTI with a file, or files, containing a street
         address/LSO cross reference indicating which LSO serves the cross
         referenced street address.

23.      MISCELLANEOUS

23.1     DELEGATION OR ASSIGNMENT - Any assignment by either Party of any right,
         obligation, or duty, in whole or in part, or of any interest, without
         the written consent of the other Party shall be void, except that
         either Party may assign all of its rights, and delegate its
         obligations, liabilities and duties under this Agreement, either in
         whole or in part, to any entity that is, or that was, an Affiliate of
         that Party without consent, but with written notification, provided
         that in the case of ATTI, such Affiliate is a certified provider of
         local dial-tone service in the State to the extent such State requires
         such certification. The effectiveness of an assignment shall be
         conditioned upon the assignee's assumption of the rights, obligations,
         and duties of the assigning Party.


<PAGE>

                                                                         Page 24


23.2     SUBCONTRACTING - GTE may subcontract the performance of any obligation
         under this Agreement without the prior written consent of ATTI,
         provided that GTE shall remain fully responsible for the performance of
         this Agreement in accordance with its terms, including any obligations
         it performs through subcontractors, and GTE shall be solely responsible
         for payments due its subcontractors. No contract, subcontract or other
         Agreement entered into by either Party with any third party in
         connection with the provision of Local Services or Network Elements
         hereunder shall provide for any indemnity, guarantee or assumption of
         liability by, or other obligation of, the other Party to this Agreement
         with respect to such arrangement, except as consented to in writing by
         the other Party. No subcontractor shall be deemed a third party
         beneficiary for any purposes under this Agreement.

23.3     [Intentionally deleted].

23.4     BINDING EFFECT - This Agreement shall be binding on and inure to the
         benefit of the respective successors and permitted assigns of the
         Parties.

23.5     NONEXCLUSIVE REMEDIES - Except as otherwise expressly provided in this
         Agreement, each of the remedies provided under this Agreement is
         cumulative and is in addition to any remedies that may be available at
         law or in equity.

23.6     NO THIRD-PARTY BENEFICIARIES - Except as specifically set forth in
         Section 10.4 and 10.5, this Agreement does not provide and shall not be
         construed to provide third parties with any remedy, claim, liability,
         reimbursement, cause of action, or other privilege.

23.7     REFERENCED DOCUMENTS - Whenever any provision of this Agreement refers
         to A technical reference, technical publication, ATTI Practice, GTE
         Practice, any publication of telecommunications industry administrative
         or technical standards, or any other document expressly incorporated
         into this Agreement, it will be deemed to be a reference to the most
         recent version or edition (including any amendments, supplements,
         addenda, or successors) of such document that is in effect at the time
         of the execution of this Agreement, and will include the most recent
         version or edition (including any amendments, supplements, addenda, or
         successors) of each document incorporated by reference in such a
         technical reference, technical publication, ATTI Practice, GTE
         Practice, or publication of industry standards.

23.8     REGULATORY AGENCY CONTROL - This Agreement shall at all times be
         subject to changes, modifications, orders, and rulings by the FCC
         and/or the applicable state utility regulatory commission to the extent
         the substance of this Agreement is or becomes subject to the
         jurisdiction of such agency. This Agreement is subject to approval of
         the Commission in accordance with Section 252 of the Act. This
         Agreement shall not become effective until five


<PAGE>

                                                                         Page 25

          (5) Business Days after receipt by the Parties of written notice of
          such approval. "Business Day" shall mean Monday through Friday, except
          for holidays on which the U. S. Mail is not delivered.

23.9      [Intentionally deleted].

23.10     PUBLICITY AND ADVERTISING - Any news release, public announcement,
          advertising, or any form of publicity pertaining to this Agreement, or
          the provision of Local Services, Unbundled Network Elements, Ancillary
          Functions or Interconnection Services pursuant to it, or association
          of the Parties with respect to provision of the services described in
          this Agreement shall be subject to prior written approval of both GTE
          And ATTI. Neither Party shall publish or use any advertising, sales
          promotions or other publicity materials that use the other Party's
          logo, trademarks or service marks without the prior written approval
          of the other Party.

23.11     AMENDMENTS OR WAIVERS - Except as otherwise provided in this
          Agreement, no amendment or waiver of any provision of this Agreement,
          and no consent to any default under this Agreement, shall be effective
          unless the same is in writing and signed by an officer of the Party
          against whom such amendment, waiver or consent is claimed. In
          addition, no course of dealing or failure of a Party strictly to
          enforce any term, right or condition of this Agreement shall be
          construed as a waiver of such term, right or condition. By entering
          into this Agreement, neither Party waives any right granted to it
          pursuant to the Act.

23.12     SEVERABILITY - If any term, condition or provision of this Agreement
          is held by a governmental body of competent jurisdiction to be invalid
          or unenforceable for any reason, such invalidity or unenforceability
          shall not invalidate the entire Agreement. The Agreement shall be
          construed as if it did not contain the invalid or unenforceable
          provision or provisions, and the rights and obligations of each Party
          shall be construed and enforced accordingly.

23.13     ENTIRE AGREEMENT - This Agreement, which shall include the
          Attachments, Appendices and other documents referenced herein,
          constitutes the entire Agreement between the Parties concerning the
          subject matter hereof and supersedes any prior agreements,
          representations, statements, negotiations, understandings, proposals
          or undertakings, oral or written, with respect to the subject matter
          expressly set forth herein.

23.14     SURVIVAL OF OBLIGATIONS - Any liabilities or obligations of a Party
          for acts or omissions prior to the cancellation or termination of this
          Agreement; any obligation of a Party under the provisions regarding
          indemnification, Confidential Information, limitations on liability,
          and any other provisions of this Agreement which, by their terms, are
          contemplated to survive (or to be performed after) termination of this
          Agreement, shall survive cancellation or termination thereof.


<PAGE>

                                                                         Page 26


23.15     [Intentionally deleted].

23.16     HEADINGS OF NO FORCE OR EFFECT - The headings of Articles and Sections
          of this Agreement are for convenience of reference only, and shall in
          no way define, modify or restrict the meaning or interpretation of the
          terms or provisions of this Agreement.

23.17     TRADEMARKS AND TRADE NAMES - Except as specifically set out in this
          Agreement, nothing in this Agreement shall grant, suggest, or imply
          any right, license or authority for one Party to use the name,
          trademarks, service marks, or trade names of the other Party for any
          purpose whatsoever.

23.18     NOTICE OF NETWORK AND TECHNOLOGY CHANGES - GTE shall establish
          quarterly reviews of network and technologies plans. GTE shall notify
          ATTI at least six (6) months in advance of changes that would impact
          ATTI's provision of service.

23.19     TECHNICAL REFERENCES -

23.19.1   The technical references cited throughout this Agreement shall apply
          unless GTE shall offer, within ninety (90) days following Commission
          approval of this Agreement, GTE's proposed substitute technical
          references, for consideration and review by subject matter experts
          designated, respectively, by ATTI and GTE. Within ten (10) business
          days following ATTI's receipt of true and complete copies of GTE's
          proposed substitute technical references, ATTI and GTE subject matter
          experts shall meet in person or via teleconference to review the
          substitute reference(s) with a view toward achieving agreement on the
          suitability of such references for implementation and incorporation
          into this Agreement. The subject matter experts may agree to implement
          and incorporate, to modify or supplement, or to replace any such
          substitute technical reference proposed by GTE. Where they so agree,
          the resulting substitute technical reference shall be implemented and
          incorporated forthwith, by formal amendment in writing, into this
          Agreement. Where they disagree with respect to the suitability or
          adequacy of any such proposed substitute technical reference, the
          GTE-proposed substitute technical reference shall be incorporated into
          this Agreement at the conclusion of the ten business day period cited
          above, by formal amendment in writing, subject to ATTI's right to
          pursue the dispute and the implementation of more suitable technical
          references through the ADR procedures set forth in Attachment I to
          this Agreement. ATTI may initiate such ADR procedures within sixty
          (60) days following the incorporation of the challenged technical
          reference into this Agreement.

23.19.2   The parties recognize the possibility that some equipment vendors may
          manufacture telecommunications equipment that does not fully
          incorporate or may deviate from the technical references contained in
          this Agreement. To


<PAGE>

                                                                         Page 27


          the extent that, due to the manner in which individual manufacturers
          may have chosen to implement industry standards into the design of
          their product, or due to the differing vintages of these individual
          facility components and the presence of embedded technologies that
          pre-date certain technical references, some of the individual facility
          components deployed with GTE's network may not adhere to the technical
          references, then, within forty-five (45) days after the Effective Date
          of this Agreement:

                    (a) the Parties will develop processes by which GTE will
          inform ATTI of any such deviations from technical standards for
          Network Elements or Combinations ordered by ATTI;

                    (b) the Parties will develop further processes and
          procedures designed, upon notice of such deviations from technical
          standards, to address the treatment of GTE and ATTI customers at
          parity; and

                    (c) the parties will take such other mutually agreed upon
          actions as shall be appropriate in the circumstances.

23.20     Any figures and/or schematics used throughout this Agreement,
          including, but not limited to, the figures and/or schematics used in
          Attachment 2 to this Agreement, are for the convenience of reference
          only, and shall in no way define, modify or restrict the meaning or
          interpretation of the terms or provisions of this Agreement.


<PAGE>

                                                                         Page 28


                          PART I LOCAL SERVICES RESALE

24.       TELECOMMUNICATIONS SERVICES PROVIDED FOR RESALE

          Upon request by ATTI in accordance with Section 25.1 and subject to
          the restrictions contained in Section 25.3 hereunder, GTE shall make
          available to ATTI at the applicable rate set forth in Attachment 14,
          any Telecommunications Service that GTE currently offers or may
          hereafter offer at retail to subscribers that are not
          telecommunications carriers. Such Telecommunications Services provided
          by GTE pursuant to this Section are collectively referred to as "Local
          Services.

25.       GENERAL TERMS AND CONDITIONS FOR RESALE

25.1      ORDERING

25.1.1    Orders for resale of Local Services will be placed utilizing a
          standard Local Service Request ("LSR") form. A complete and accurate
          LSR must be provided by ATTI before a request can be processed;
          provided, however, that immaterial deviations or omissions in the LSR
          will not prevent an order from being processed. Each Party shall
          transfer the customer's service features and functionalities "as is"
          to the other Party when requested by a customer. For purposes of this
          Section 25, an "as is transfer" is the transfer of all the
          telecommunications services and features available for resale that are
          currently being provided for the specified account without the
          requirement of a specific enumeration of the services and features on
          the LSR.

25.1.2    A Letter of Authorization ("LOA") will be required before Local
          Services will be provided for resale to a subscriber that currently
          receives local exchange service from GTE or from a local service
          provider other that ATTI. Such LOA may be a blanket letter of
          authorization (Blanket LOA) or such other form as agreed upon by ATTI
          and GTE. When a Blanket LOA has been provided by ATTI, GTE shall not
          require an additional disconnect order, LOA or other writing from a
          customer, or another LEC, in order to process an order for Local
          Service. Each Party will provide the capability for customers to
          retain their current phone number in the event that they change local
          service providers to the extent technically feasible, allowing them to
          retain all existing features and functionalities.

25.1.3    GTE shall include an ATTI Customer's listing in its Directory
          Assistance database as part of the Local Service Request ("LSR")
          process. GTE will honor ATTI Customer's preferences for listing
          status, including non-published and unlisted, as noted on the LSR and
          will enter the listing in the GTE


<PAGE>

                                                                         Page 29


          database which is used to perform Directory Assistance functions as it
          appears on the LSR.

25.1.4    GTE shall accept requests for a change in the primary interexchange
          carrier of a local exchange customer of ATTI only from ATTl.

25.2      PRICING

          The prices to be charged to ATTI for Local Services under this
          Agreement are set forth in Part V of this Agreement.

25.3      RESTRICTIONS ON RESALE

          To the extent consistent with the applicable rules and regulations of
          the FCC and the Commission, ATTI may resell all GTE Local Services as
          defined in GTE's tariffs. The following restrictions shall apply to
          the resale of Local Services, as described in Section 24 of this
          Agreement by ATTI: (i) ATTI shall not resell residential services to
          business customers; (ii) GTE shall not be required to offer at a
          wholesale discount to ATTI any GTE promotional offering that is made
          available to any GTE customer for a period of ninety (90) days or
          less; (iii) and GTE shall not be required to provide to ATTI for
          resale any retail service which a telecommunications carrier is by law
          required to provide as a social benefit to a specially designated
          class of customer. ATTI shall determine whether its customers qualify
          for any such social programs and shall bear the costs associated with
          the provision of such programs.

25.4      [Intentionally deleted]

25.5      DIALING AND SERVICE PARITY

25.5.1    GTE will provide the same dialing parity to ATTI Customers as
          similarly-situated GTE Customers, such that, for all call types, an
          ATTI Customer is not required to dial any greater number of digits
          than a similarly-situated GTE Customer; provided however with respect
          to intra-LATA dialing, GTE shall provide dialing parity to ATTI
          customers in the State in accordance with the provisions and schedule
          established by the Commission.

25.5.2    GTE will provide service levels for Local Services for resale that are
          equal to service levels for similarly-situated GTE Customers, such
          that there is no loss of features or functionalities including, but
          not limited to: same dial tone and ringing; same capability for either
          dial pulse or touch tone recognition; flat and measured services;
          speech recognition as available; same extended local free calling
          area; 1+ IntraLATA toll calling; InterLATA toll calling and
          international calling; 500, 700, 800, 900, 976 and Dial Around (10xxx)
          Services; restricted collect and third number billing; all available
          speeds of


<PAGE>

                                                                         Page 30


          analogue and digital private lines; off-premise extensions; CENTRANET
          and ISDN.

25.6      CHANGES IN RETAIL SERVICE

          GTE will notify ATTI of proposed new retail services or modifications
          to existing retail services forty-five (45) days prior to the expected
          date of regulatory approval of the new or modified services. If new
          services or modifications are introduced with less than forty-five
          (45) days notice to the regulatory authority, GTE will notify ATTI at
          the same time it determines to introduce the new or modified service.
          With respect to changes in prices for existing retail services or
          related resale rates, GTE will notify ATTI at the same time as GTE
          begins internal implementation efforts (i.e., at least at the time
          that GTE's Product Management Committee is notified of the proposed
          change) or obtains internal approval to make the price change,
          whichever is sooner.

26.       REQUIREMENTS FOR SPECIFIC SERVICES

26.1      [Intentionally deleted]

26.2      CLASS/LASS and Custom Features Requirements

          ATTI may purchase the entire set of CLASS/LASS and Custom features and
          functions, or a subset of any one or any combination of such features,
          on a customer-specific basis, without restriction on the minimum or
          maximum number of lines or features that may be purchased for any one
          level of service, provided such CLASS/LASS and Custom features are
          available to GTE Customers served by the same GTE Central Office. GTE
          shall provide to ATTI a list of CLASS/LASS and Custom features and
          functions within ten (10) business days of the Effective Date and
          shall provide updates to such list when new features and functions
          become available. GTE shall provide to ATTI a list of all services,
          features, and products including a definition of the service (by
          specific reference to the appropriate tariff sections) and how such
          services interact with each other. GTE shall provide features and
          services by street address guide and by switch. All features shall be
          at least at parity with the GTE service offering.

26.3      This Section intentionally left blank.

26.4      INTERCEPT AND TRANSFER SERVICE

          GTE shall provide intercept and transfer service to ATTI for ATTI
          Customers on the same basis and for the same length of time as such
          service is available to similarly-situated GTE Customers. To that end,
          when an end-user customer transfers service from GTE to ATTI , or from
          ATTI to GTE, and does


<PAGE>

                                                                         Page 31


          not retain its original telephone number, the Party formerly providing
          service to the end user will provide, upon request, a referral
          announcement on the original telephone number. The announcement will
          provide the new number of the customer.

26.5      E911/911 SERVICES

          GTE shall provide to ATTI, for ATTI Customers, E911/911 call routing
          to the appropriate PSAP. ATTI shall provide ATTI Customer information
          to GTE, and GTE shall validate and provide ATTI Customer information
          to the PSAP. GTE shall use its service order process to update and
          maintain, on the same schedule that it uses for its end users, the
          ATTI Customer service information -in the ALI/DMS (Automatic Location
          Identification/Location Information Database Management System) used
          to support E911/911 services, pursuant National Emergency Number
          Agency (NENA) standards. ATTI shall have the right to verify the
          accuracy of the information regarding ATTI Customers in the ALI
          database.

26.6      TELEPHONE RELAY SERVICE

          GTE will provide the following information to ATTI at no additional
          charge: (i) information concerning a customer's qualification for
          Telephone Relay Service (TRS) on the Customer Service Record (CSR)
          when that customer chooses ATTI for local service; and (ii) all usage
          billing information which GTE receives from a provider of TRS for TRS
          usage by an ATTI Customer.

26.7      VOICE MAIL RELATED SERVICES

          Nothing in this Agreement shall limit the right of ATTI to purchase
          features capabilities of voice mail services in accordance with GTE's
          tariffs. In addition, nothing in this Agreement shall limit the right
          of ATTI to combine features capabilities of voice mail services
          purchased in accordance with GTE's tariffs with any Local Services
          purchased for resale in accordance with this Agreement.

26.8      VOLUNTARY FEDERAL CUSTOMER FINANCIAL ASSISTANCE PROGRAMS

          Local Services provided to low-income subscribers, pursuant to
          requirements established by the appropriate state or federal
          regulatory body, include programs such as Voluntary Federal Customer
          Financial Assistance Programs, such as Lifeline, and Link-up America
          (collectively referred to as "Voluntary Federal Customer Financial
          Assistance Programs") and Directory Assistance - Exempt. When a GTE
          Customer eligible for these services chooses to obtain Local Service
          from ATTI , GTE shall forward to ATTI on the Customer Service Record
          information regarding such customer's eligibility to participate in
          such programs. If GTE under the applicable laws of the State


<PAGE>

                                                                         Page 32


          cannot provide the CSR to ATTI, GTE shall otherwise inform ATTI of
          such customer's eligibility.

27.       ADVANCED INTELLIGENT NETWORK

27.1      GTE will provide ATTI access to the GTE Service Creation Environment
          (SCE) to design, create, test, deploy and provision AIN-based
          features, equivalent to the access GTE provides to itself, providing
          that security arrangements can be made. ATTI requests to use the GTE
          SCE will be subject to request, review and testing procedures to be
          agreed upon by the parties.

27.2      When ATTI utilizes GTE's Local Switching network element and requests
          GTE to provision such network element with a technically feasible AIN
          trigger, GTE will provide access to the appropriate AIN Call Related
          Database for the purpose of invoking either a GTE AIN feature or an
          ATTI developed AIN feature described in 27.1, above.

27.3      When ATTI utilizes its own local switch, GTE will provide access to
          the appropriate AIN Call Related Database for the purpose of invoking
          either a GTE AIN feature or an ATTI developed AIN feature described in
          27.1, above.

27.4      Any mediation to GTE's AIN database will be performed on a
          competitively neutral, nondiscriminatory basis. Any network management
          controls found necessary to protect the SCP from an overload condition
          must be applied on a nondiscriminatory basis for all users of that
          database, including GTE. GTE and ATTI agree that any load mediation
          will affect all links to the STP, including GTE's, in a like manner.
          ATTI will provide the information necessary to ensure that GTE is able
          to engineer sufficient capacity on the AIN SOP platform.

28.       ROUTING TO DIRECTORY ASSISTANCE AND OPERATOR SERVICES

28.1      Where ATTI purchases either Local Services or Local Switching as an
          Unbundled Element, unless ATTI requests otherwise, GTE will, where
          technically feasible, provide the functionality and features required
          to modify the ATTI Customer's line at GTE's local switch (LS) to route
          all calls to the ATTI Network for local Directory Assistance and the
          ATTI Platform for Operator Services.

28.2      DIRECTORY ASSISTANCE


<PAGE>

                                                                         Page 33


          Upon ATTI's request, and where technically feasible GTE shall route
          local Directory Assistance calls, including 411 and (NPA) 555-1212,
          dialed by ATTI Customers directly to the ATTI platform, unless ATTI
          requests otherwise pursuant to Section 28.7.2.

28.3      OPERATOR SERVICES

          Upon ATTI's request, and where technically feasible, GTE shall route
          local Operator Services calls (0+, 0-) dialed by ATTI Customers
          directly to the ATTI Local Operator Services platform, unless ATTI
          requests otherwise pursuant to Section 28.7.1. Such traffic shall be
          routed over trunk groups specified by ATTI which connect GTE end
          offices and the ATTI Local Operator Services platform, using standard
          Operator Services dialing protocols of 0+ or 0-. Where intraLATA
          presubscription is not available, GTE will provide the functionality
          and features within its local switch (LS), to route ATTI Customer
          dialed 0- and 0+ intraLATA calls to the ATTI T designated line or
          trunk on the Main Distributing Frame (MDF) or Digital Cross Connect
          (DSX) panel via Modified Operator Services (MOS) Feature Group C
          signaling. Where intraLATA presubscription is available, ATTI Customer
          dialed 0- and 0+ intraLATA calls will be routed to the intraLATA PlC
          carrier's designated operator services platform. In all cases, GTE
          will provide post-dial delay no greater than that provided by GTE for
          its end user customers. For switches lacking the existing capacity and
          capability to provide the customized rerouting described in this
          Section 28, GTE shall develop alternative forms of customized routing.

28.4      REPAIR CALLS

          In the event an ATTI Customer calls GTE with a request for repairs,
          GTE shall provide the ATTI Customer with ATTI's repair 800-telephone
          number. ATTI agrees to provide GTE with ATTI's repair 800-telephone
          numbers.

          In the event a GTE Customer calls ATTI with a request for repairs,
          ATTI shall provide the GTE Customer with GTE's repair 800-telephone
          number. GTE agrees to provide ATTI with GTE's repair 800-telephone
          number.

28.5      NON-DISCRIMINATORY TREATMENT

          All direct routing capabilities described herein shall permit ATTI
          Customers to dial the same telephone numbers for ATTI Directory
          Assistance, Local Operator and the same number of digits for Repair
          Services that similarly-situated GTE Customers dial for reaching
          equivalent GTE services. ATTI and GTE will use 800/888 numbers where
          necessary to achieve this result.


<PAGE>

                                                                         Page 34


28.6      EMERGENCY CALLS

          Within thirty (30) days of ATTI's request, GTE shall provide to ATTI
          the emergency public agency (e.g., police, fire, ambulance) telephone
          numbers linked to each NPA-NXX. Such data will be transmitted in a
          mutually agreeable format.

28.7      OPTIONAL ROUTING

28.7.1    Operator Services: ATTI may request GTE to route ATTI Customers to GTE
          Operator Services. In this case, the requirements for GTE-provided
          Operator Services as part of the Total Services Resale service shall
          be those requirements specified in Attachment 2, "Unbundled Elements",
          Section 5.1 "Operator Services."

28.7.2    Directory Assistance: ATTI T may request GTE to route ATTI Customers
          to GTE's Directory Assistance. In this case, the requirements for
          GTE-provided Directory Assistance Services as part of the Total
          Services Resale service shall be those requirements specified in
          Attachment 2, "Unbundled Elements", Section 6, "Directory Services."

28.8      LINE INFORMATION DATABASE UPDATES

          GTE shall update and maintain ATTI Customer information in the GTE
          Line Information Database ("LIDB") in the same manner and on the same
          schedule that it maintains information in LIDB for GTE Customers.

28.9      TELEPHONE LINE NUMBER CALLING CARDS

          Upon request by an ATTI Customer or by ATTI on behalf of an ATTI
          Customer, and effective as of the date of an end user's subscription
          to ATTI service (or such later date as such request is received), GTE
          will remove any GTE-assigned telephone line calling card number
          (including area code) ("TLN") from GTE's LIDB. ATTI may issue a new
          telephone calling card to such customer, utilizing the same TLN, and
          ATTI shall have the right to enter such TLN in ATTI's LIDB for calling
          card validation purposes.

28.10     END OFFICE FEATURES

          GTE shall provide the following end-office features in those end
          offices in which such features are available to GTE Customers: CLASS
          features; Repeat Dial Capability; Multi-line Hunting; and trunk
          connectivity to private branch exchange switches (PBX's) and Direct
          Inward Dialed Services and all other end-office features that GTE
          makes available to GTE Customers.


<PAGE>

                                                                         Page 35


28.11     CALL BLOCKING

          Upon ATTI's `s request and when available to similarly-situated GTE
          Customers, GTE will provide blocking on a line by line basis of an
          ATTI Customer's access to any or all of the following call types:
          900/976; bill to third and collect; and such other call types for
          which GTE provides blocking to similarly situated GTE Customers.

28.12     LAW ENFORCEMENT AND SERVICE ANNOYANCE

          Not later than forty-five (45) business days after the Effective Date,
          GTE and ATTI will begin the process of developing procedures to handle
          requests from law enforcement agencies for service termination, wire
          taps and provisions of Customer Usage Data pursuant to a lawful
          process as well as procedures to handle ATTI Customer complaints
          concerning harassing or annoying calls. Such procedures will include,
          but not be limited to, a process for ATTI to interface with GTE
          regarding law enforcement and service annoyance issues on a 24 hour
          per day, 7 days a week basis and otherwise on the same basis as GTE
          provides access for its own customers.

29.       SERVICE SUPPORT FUNCTIONS

29.1      ELECTRONIC INTERFACE

29.1.1    Until such time as GTE and ATTI are able to fully implement electronic
          interfaces ("El"), GTE and ATTI agree to use interim processes for
          Pre-Ordering, Ordering, Provisioning, Maintenance, Repair and Billing.

29.1.1.1  The schedule for implementing an interim electronic interface shall be
          subject to the memorandum of understanding ("MOU") relating to
          electronic interfaces negotiated by GTE and AT&T under the direction
          of the California Commission in connection with the decision in
          96-07-022.

29.1.2    In accordance with the schedule set out in the MOU, GTE shall provide
          a Real Time electronic interface ("El") for sending and receiving
          information on demand for Pre-Ordering, for Ordering/Provisioning data
          and materials (e.g., access to Street Address Guide ("SAG") and
          Telephone Number Assignment database), and for scheduling service
          delivery. GTE shall provide an electronic interface ("El") for sending
          and receiving information on agreed, pre-defined schedules ("batch
          communications") for reports and Billing. These interfaces shall be
          administered through a national ordering platform that will serve as a
          single point of contact for the transmission of such data from ATTI to
          GTE, and from GTE to ATTI.

29.1.3    No later than six (6) months after the Effective Date of this
          Agreement, GTE will: (i) establish the national gateway standards to
          be used by ATTI and all


<PAGE>

                                                                         Page 36


          other carriers connecting to GTE's Operations Support Systems ("OSS");
          and (ii) establish the date by which GTE will provide permanent
          national gateway access to its OSS. GTE will provide this permanent
          national gateway access at the earliest practical date but in no case
          later than twelve (12) months after the Effective Date of this
          Agreement, which shall include ensuring that all interfaces are
          operational and end-to-end testing has been successfully completed.

29.1.4    [DELETED]

29.1.5    The Parties agree that the principles outlined in Attachment 13 and
          related time schedules will be used as a starting point for the
          development of the permanent national gateway.

29.1.6    GTE shall provide the same information, of the same quality and within
          the same time frames for Pre-Ordering, Ordering/Provisioning,
          Maintenance! Repairs and Billing to ATTI as GTE provides to itself.
          The Parties recognize that GTE is not required to establish new
          systems or processes in order to provide information to ATTI which GTE
          does not provide to itself.

29.1.7    GTE shall recover its costs of creating the permanent OSS gateway and
          any interim interfaces in a competitively neutral manner.

29.2      SERVICE STANDARDS

29.2.1    GTE shall ensure that all Service Support Functions used to provision
          Local Service to ATTI for resale are provided at a quality level which
          GTE is required to meet by its own internal procedures or by law, or
          is actually meeting, in providing Local Service to itself, to its end
          users or to its affiliates.

29.2.2    Not later than twenty (20) business days after the Effective Date of
          this Agreement, GTE and TATTI shall begin the process of developing
          mutually agreed-upon escalation and expedite procedures to be employed
          at any point in the Local Service Pre-Ordering, Ordering/Provisioning,
          Testing, Maintenance, Billing and Customer Usage Data transfer
          processes to facilitate rapid and timely resolution of Disputes.

29.3      POINT OF CONTACT FOR THE AT&T CUSTOMER

29.3.1    Except as otherwise provided in this Agreement or as directed by ATTI,
          ATTI shall be the single and sole point of contact for all ATTI
          Customers with respect to ATTI Local Services.

29.3.2    GTE shall refer all questions regarding any ATTI service or product
          directly to ATTI at a telephone number specified by ATTI and provided
          to GTE for that purpose.


<PAGE>

                                                                         Page 37



29.3.3    GTE representatives who receive inquiries regarding ATTI services: (i)
          shall refer callers who inquire about ATTI services or products to the
          numbers provided; and (ii) will not in any way disparage or
          discriminate against ATTl, or its products or services.

29.4      SINGLE POINT OF CONTACT

          Each Party shall provide the other Party with a single point of
          contact ("SPOC") for each functional area for all inquiries regarding
          the implementation of this Part. Each Party shall accept all inquiries
          from the other Party and provide timely responses.

29.5      SERVICE ORDER

          To facilitate the ordering of new service for resale or changes to
          such service to an ATTI Customer, ATI's representative will have
          access to GTE Customer information to enable the ATTI representative
          to perform the tasks enumerated below. Until electronic interfaces are
          established, these functions will be performed with the use of an 800
          number.

29.5.1    Obtain customer account information through the same nondiscriminatory
          access to Operation Support Systems for pre-ordering, ordering,
          provisioning, maintenance and repair, and billing as GTE provides
          itself including information regarding the facilities and services
          assigned to individual customers.

29.5.2    Obtain information on all features and services available, including
          new services, by LSO identified by switch, NPA-NXX and customer street
          address.

29.5.3    Submit the ATTI T Customer order by submitting an LSR using the agreed
          upon electronic interface (the Network Data Mover or NDM) for all
          desired features and services;

29.5.4    Assign a telephone number, including a vanity number, (if the ATTI
          Customer does not have one assigned). As an interim step prior to the
          implementation of the electronic interface specified in Section 29.1,
          GTE will establish an 800 (toll-free) number for ATTI;

29.5.5    Submit the appropriate directory listing using the agreed to El;

29.5.6    Determine if a service call is needed to install the line or service;

29.5.7    Schedule dispatch and installation, if applicable;

29.5.8    Provide service availability dates to customer;


<PAGE>

                                                                         Page 38


29.5.9    Order local and intraLATA toll service and enter ATTI Customer's
          choice of primary interexchange carrier on a single, unified order;
          and

29.5.10   Suspend, terminate or restore service to an ATTI Customer using agreed
          to methods (temporary disconnects for nonpayment may not be requested
          using the LSR).

29.6      PROVISIONING

29.6.1    After receipt and acceptance of an LSR, GTE shall provision such LSR
          in accordance with the following Intervals and in accordance with the
          service parity standards and other performance standards specified in
          Section 11 and Attachment 12.

29.6.2    GTE shall provide ATTI with service status notices, on a Real Time
          basis. Such status notices shall include the following:

29.6.2.1  Firm order confirmation, including service availability date and
          information regarding the need for a service dispatch for
          installation;

29.6.2.2  Notice of service installation issued at time of installation,
          including any additional information, such as material charges;

29.6.2.3  Changes/rejections/errors in LSRs;

29.6.2.4  Service completion;

29.6.2.5  Jeopardies and missed appointments;

29.6.2.6  Charges associated with necessary construction;

29.6.2.7  Order status at critical intervals;

29.6.2.8  Test results of the same type that GTE records for itself or its own
          customers.

29.6.3    GTE shall inform ATTI of overall change order flexibility and any
          changes thereto on a Real Time basis.

29.6.4    GTE shall notify ATTI prior to making any changes in the services,
          features or functions specified on the LSR. If an ATTI Customer
          requests a service change at the time of installation GTE shall refer
          the ATTI Customer to ATTI.

29.6.5    GTE shall provide provisioning support to ATTI on the same basis that
          it provides to other competitive LECs and to itself. GTE retains full
          discretion to control the scheduling of its provisioning workforce.


<PAGE>

                                                                         Page 39


29.6.6    GTE shall provide training for all GTE employees who may communicate,
          either by telephone or face-to-face, with ATTI Customers, during the
          provisioning process. Such training shall include training on
          compliance with the branding requirements of this Agreement.

29.7      PROVISION OF CUSTOMER USAGE DATA

          GTE shall provide the Customer Usage Data recorded by GTE. Such data
          shall include complete ATTI Customer usage data for Local Service,
          (i.e., the same usage data that GTE records for billing its own
          customers), in accordance with the terms and conditions set forth in
          Attachment 7.

29.8      SERVICE/OPERATION READINESS TESTING

29.8.1    In addition to testing described elsewhere in this Section 29, GTE
          shall test the systems used to perform the following functions at a
          negotiated interval and in no event less than ten (10) business days
          prior to commencement of GTE's provision of Local Service to ATTI, in
          order to establish system readiness capabilities:

29.8.1.1  All interfaces between TATTI and GTE work centers for Service Order
          Provisioning;

29.8.1.2  Maintenance, Billing and Customer Usage Data;

29.8.1.3  The process for GTE to provide customer profiles;

29.8.1.4  The installation scheduling process;

29.8.1.5  Network alarm reporting;

29.8.1.6  Telephone number assignment;

29.8.1.7  Procedures for communications and coordination between ATTI SPOC and
          GTE SPOC;

29.8.1.8  Procedures for transmission of Customer Usage Data; and

29.8.1.9  Procedures for transmitting bills to AT&T for Local Service.

29.8.2    The functionalities identified above shall be tested in order to
          determine whether GTE performance meets the service parity
          requirements and other performance standards specified in Section 11.
          GTE shall make available sufficient technical staff to perform such
          testing. GTE technical staff shall be available to meet with ATTI as
          necessary to facilitate testing. GTE and ATTI shall mutually agree on
          the schedule for such testing.


<PAGE>

                                                                         Page 40


29.8.3    At ATTI's request, GTE shall provide to ATTI any results of the
          testing performed pursuant to the terms of this Part. ATTI may review
          such results and may notify GTE of any failures to meet the
          requirements of this Agreement.

29.8.4    GTE shall provide to ATTI the same type and quality of loop testing
          information that it provides to and records for itself. Where GTE
          develops loop testing information as a matter of course, it will make
          that information available to ATTI where such information is relevant
          to ATTI's business. Where GTE maintains the internal discretion to
          test loops as needed, GTE will provide similar testing discretion to
          ATTI. ATTI shall pay the full cost of any such discretionary testing.

29.8.5    Within 60 days of the Effective Date of this Agreement, ATTI and GTE
          will agree upon a process to resolve cooperative testing issues and
          technical issues relating to GTE's provision of Local Services to
          ATTI. The agreed upon process shall include procedures for escalating
          disputes and unresolved issues up through higher levels of each
          company s management. If ATTI and GTE do not reach agreement on such a
          process within 60 days, any issues that have not been resolved by the
          Parties with respect to such process shall be submitted to the ADR
          procedures set forth in Section 14 and Attachment I of this Agreement
          unless both Parties agree to extend the time to reach agreement on
          such issues.

29.9      MAINTENANCE

          GTE shall provide maintenance in accordance with the requirements and
          standards set forth in Attachment 5 and in accordance with the service
          parity requirements set forth in this Agreement.

29.10     BILLING FOR LOCAL SERVICE

29.10.1   GTE shall bill ATTI for Local Service provided by GTE to ATTI pursuant
          to the terms of this Part, and in accordance with the terms and
          conditions for Connectivity Billing and Recording in Attachment 6.

29.10.2   GTE shall recognize ATTI as the customer of record for all Local
          Service and will send all notices, bills and other pertinent
          information directly to ATTI.

30.       PAY PHONE LINES AND PAY PHONE SERVICES

30.1      Intentionally left blank.

30.2      "Pay phone lines" are defined as the loop from the pay phone point of
          demarcation to the Service Wiring Center and includes all supporting
          central office functions and features.


<PAGE>

                                                                         Page 41


30.3      GTE shall make available to ATTI for resale the following classes of
          pay phone lines:

30.3.1    Customer Owned Coin Operated Telephone (COCOT) Lines;

30.3.2    Coinless COCOT Lines;

30.3.3    Coin Lines in those jurisdictions where provision of such lines is
          required by law

30.3.4    [This section left intentionally blank]

30.3.5    Semi Public Lines.

30.4      GTE shall also make available to ATTI for resale any future class of
          pay phone lines that GTE provides at retail to subscribers other than
          telecommunication carriers.

30.5      GTE shall make available pay phone line service options as follows:

30.6      When providing COCOT Lines to ATTI for resale, GTE shall offer the
          following, to the extent that GTE provides such services and in those
          jurisdictions and/or central offices where available: originating line
          screening; billed number screening; PlC protection for all 1+ inter
          and intraLATA traffic (when presubscription is authorized); one way
          and/or two way service (if so provided in the applicable tariff) on
          the line; detailed billing showing all 1+ traffic; ATTI's service
          center phone number to all ATTI end users that contact GTE service
          centers; number portability for end users; touchtone service; line
          side answer supervision; GTE designated contact center as single point
          of contact for customer service; provisioning of 9 1 1 service; access
          to Answer Number Identifier (ANI) Information; all information
          necessary to permit ATTI to bill end users for access line usage; the
          same monitoring and diagnostic routines as GTE utilizes on its own
          facilities; one directory for each line installed; blocking for 1+
          international calls, 10XXX1+ international calls 1-900 calls, 1-976
          calls DA link, any 1+ service that can be billed to the line but that
          is not rated, 1-700 calls, 1-500 calls, and in bound international
          calls where SS7 signalling is available.

30.7      When providing Coinless COCOT Lines to ATTI for resale, GTE shall
          offer the following, to the extent that GTE provides such services and
          in those jurisdictions and/or central offices where available:
          originating line screening; billed number screening; PlC protection
          for all 1+ inter and intraLATA traffic (where inter and intraLATA
          presubscription is available); one way and/or two way service on the
          line (if so provided in the tariff); flat service where flat service
          is required by the applicable tariff, measured service where measured
          service is required by the applicable tariff, and both flat and
          measured service


<PAGE>

                                                                         Page 42


          where both flat and measured service are required by the applicable
          tariff; detailed billing showing all 1+ traffic; ATTI's service center
          phone number to all ATTI end users that contact GTE service center;
          number portability for end users; touchtone service; GTE designated
          contact center as single point of contact for customer service;
          provisioning of 911 service; access to ANI information; all
          information necessary to permit ATTI to bill end users for access line
          usage; the same monitoring and diagnostic routines as GTE utilizes on
          its own facilities; one directory for each line installed; blocking
          for any service that can be billed to the line but not rated and all
          1+ calls except where local mandate requires access to Directory
          Assistance.

30.8      [Intentionally deleted.]

30.9      When providing Customer Owned Pay Telephone (COPT) Lines to ATTI for
          resale, GTE shall offer the following to the extent that GTE provides
          such services and in those jurisdictions and/or central offices where
          available. Access to all Central Office intelligence required to
          provide COPT Line pay phone services; far end disconnect recognition;
          call timing for intra- and interLATA calls; at the customer's option,
          one way or two way service on the line in those jurisdictions where
          available; detailed billing showing all 1+ traffic ATTI's service
          center phone number to all ATTI end users; touchtone service; line
          side supervision in those jurisdictions where available; GTE
          designated contact center for use by ATTI only as single point of
          contact for customer service; provisioning of 911 service; access to
          ANI information; all information necessary to permit ATTI to bill end
          users for access line usage; the same monitoring and diagnostic
          routines as GTE utilizes on its own facilities; one directory for each
          line installed; blocking for 1+ international calls and any 1+ service
          that cannot be rated by the phone pay line or any operator service.

30.10     For any pay phone line provided to ATTI for resale, GTE shall also
          make available to ATTI any future pay phone line option that GTE
          provides to any of its own customers using such a pay phone line.

30.11     GTE shall adhere to the following additional requirements when
          providing pay phone lines for resale:

30.11.1   GTE shall provide ATTI with the same call restrictions and fraud
          protections used by GTE in connection with its pay phones;

30.11.2   GTE shall not block ATTI's existing access to [NAI] codes;

30.11.3   GTE shall forward all ATTI pay phone customers to the designated ATTI
          line or trunk group for handling Operator Services or Directory
          Assistance calls;

30.11.4   [Intentionally Deleted]


<PAGE>

                                                                         Page 43


                       PART II: UNBUNDLED NETWORK ELEMENTS

31.       INTRODUCTION

          This Part II sets forth the unbundled Network Elements that GTE agrees
          to offer to ATTI in accordance with its obligations under Section 251
          (c)(3) of the Act and 47 CFR 51.307 to 51.321 of the FCC Rules. The
          specific terms and conditions that apply to the unbundled Network
          Elements are described below and in Attachment 2. Prices for Network
          Elements are set forth in Part V and Attachment 14 of this Agreement.

32.       UNBUNDLED NETWORK ELEMENTS

32.1      GTE will offer Network Elements to ATTI on an unbundled basis at rates
          set forth in Attachment 14.

32.2      GTE will permit ATTI to interconnect ATTI's facilities or facilities
          provided by ATTI or by third parties with each of GTE's unbundled
          Network Elements at any point designated by ATTI that is technically
          feasible.

32.3      ATTI, at its option, may designate any technically feasible network
          interface at a Served Premises, including without limitation, DSO,
          DS-1, DS-3, and STS-1.

32.4      Pursuant to the terms of this Agreement, ATTI may use one or more
          Network Elements to provide any Telecommunications Service that such
          Network Element is capable of providing.

32.5      GTE shall offer each Network Element individually and in combination
          with any other Network Element or Network Elements, so long as such
          combination is technically feasible, in order to permit ATTI to
          combine such Network Element or Network Elements with another Network
          Element or other Network Elements obtained from GTE or with network
          components provided by itself or by third parties to provide
          telecommunications services to its customers.

32.6      For each Network Element, GTE shall provide a demarcation point (e.g.,
          an interconnection point at a Digital Signal Cross-Connect or Light
          Guide Cross-Connect panels or a Main Distribution Frame) and, if
          necessary, access to such demarcation point, which ATTI agrees is
          suitable. However, where GTE provides contiguous Network Elements to
          ATTI, GTE may provide the existing interconnections and no demarcation
          point shall exist between such contiguous Network Elements.


<PAGE>

                                                                         Page 44


32.7      [Intentionally deleted].

32.8      [Intentionally deleted].

32.9      Except with respect to the Loop Distribution, Loop
          Concentrator/Multiplexer, and Loop Feeder elements, which shall in all
          cases be subject to the bona fide request process described in
          Attachment 12, set forth below is a list of Network Elements that ATTI
          and GTE have identified as of the Effective Date of this Agreement and
          will be offered by GTE. ATTI and GTE agree that ATTI may identify
          additional or revised Network Elements that it desires. All such
          additional or modified Network Elements shall be subject to the Bona
          Fide Requests Procedures outlined in Attachment 12. Descriptions and
          requirements for each Network Element identified below are set forth
          in Attachment 2. The Network Elements described in Attachment 2
          consist of:

                       Loop or Loop Combination
                       Network Interface Device (NID)
                       Loop Distribution, otherwise known as Distribution Media
                       Loop Concentrator/Multiplexer
                       Loop Feeder Local Switching
                       Operator Service
                       Directory Assistance Service
                       Common Transport
                       Dedicated Transport
                       Signaling Link Transport
                       Signaling Transfer Points
                       Service Control Points (SCPs)/Data bases
                       Tandem Switching
                       Unused Transmission Media

32.10     Standards for Network Elements

32.10.1   [Intentionally Deleted]

32.10.2   [Intentionally left blank]

32.10.3   [Intentionally Deleted]

32.10.3.1 If ATTI contends that GTE has failed to meet the requirements of this
          Section 32, ATTI will provide GTE documentation of such purported
          failure. Within a reasonable time period after receiving such
          documentation, GTE shall provide to ATTI engineering, design,
          performance and other network data that the parties mutually agree


<PAGE>

                                                                         Page 45


          is necessary and sufficient for ATTI to determine that the
          requirements of this Section 32 are being met. In the event that such
          data establishes that the requirements of this Section 32 are not
          being met, GTE shall, within ten (10) business days, cure any design,
          performance or other deficiency and provide new data that the parties
          mutually agree is sufficient for ATTI to determine that such
          deficiencies have been cured. To the extent that GTE is unable to meet
          the above timeframe, GTE shall promptly notify ATTI prior to the
          expiration of such timeframe and the Parties shall agree on a revised
          completion date.

32.10.3.2 [Intentionally deleted].

32.10.4   [Intentionally Deleted].


<PAGE>

                                                                         Page 46


                          PART III: ANCILLARY FUNCTIONS

33.       INTRODUCTION

          This Part III sets forth the Ancillary Functions that GTE agrees to
          offer to ATTI so that ATTI may interconnect to GTE's network and
          obtain access to unbundled Network Elements to use to provide services
          to its customers.

34.       GTE PROVISION OF ANCILLARY FUNCTIONS

34.1      [Intentionally deleted].

34.2      GTE will permit ATTI to interconnect ATTI's equipment and facilities
          or equipment and facilities provided by ATTI or by third parties for
          purposes of interconnection or access to Network Elements at any point
          that is technically feasible in accordance with the terms and
          conditions of this Agreement.

34.3      Pursuant to the terms of this Agreement, ATTI may use any Ancillary
          Function to provide any Telecommunications Service that such Ancillary
          Function is capable of providing.

34.4      Set forth below is the list of the Ancillary Functions that ATTI and
          GTE have identified as of the Effective Date of this Agreement. Either
          Party may identify additional or revised Ancillary Functions that it
          desires. All such additional or revised Ancillary Functions shall be
          subject to the Bona Fide Requests procedures outlined in Attachment
          12. Descriptions and requirements for each Ancillary Function are set
          forth in Attachment 3. The Ancillary Functions described in Attachment
          3 consist of:

                       Collocation
                       Right of Way (ROW)
                       Conduit
                       Pole attachment

35.       STANDARDS FOR ANCILLARY FUNCTIONS

35.1      Subject to Section 23.19, each Ancillary Function shall meet or exceed
          the requirements set forth in applicable technical references, as well
          as the performance and other requirements, identified in this
          Agreement.

35.2      Each Ancillary Function provided by GTE to ATTI shall be equal in the
          quality of design, performance, features, functions and other


<PAGE>

                                                                         Page 47


          characteristics, including, but not limited to levels and types of
          redundant equipment and facilities for diversity and security, that
          GTE provides in the GTE network to itself, its affiliates or any other
          carrier.

35.3      If ATTI contends that GTE has failed to meet the requirements of Part
          III and Attachment 3, ATTI will provide GTE documentation of such
          purported failure. Within a reasonable time period after receiving
          such documentation, GTE shall provide to ATTI engineering, design,
          performance and other network data that the parties mutually agree is
          necessary and sufficient for ATTI to determine that the requirements
          of Part III and Attachment 3 of this Agreement are being met. In the
          event that such data establishes that the requirements of Part III and
          Attachment 3 of this Agreement are not being met, GTE shall, within 30
          business days, cure any design, performance or other deficiency and
          provide new data that the parties mutually agree is sufficient for
          ATTI to determine that such deficiencies have been cured. To the
          extent that GTE is unable to meet the above timeframe, GTE shall
          promptly notify ATTI prior to the expiration of such timeframe and the
          Parties shall agree on a revised completion date.

35.4      Unless otherwise designated by ATTI, each Ancillary Function provided
          by GTE to ATTI shall be made available to ATTI on a priority basis
          that is at least equal to the priorities that GTE provides to itself,
          its affiliates or any other carrier.

35.5      (Intentionally deleted)


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                                                                         Page 48


35.6      911/E911 ARRANGEMENTS

35.6.1    DESCRIPTION OF SERVICE

          ATTI shall have the right to utilize the existing GTE 911/E911
          infrastructure (as agreed in Sections 37.10.3 and 37.10.5 below) to
          provide all 911/E911 capabilities to its end users. ATTI will
          install a minimum of two dedicated trunks to GTE's 911/E911
          selective routers (i.e., 911 tandem offices) that serve the areas in
          which ATTI provides Exchange Services, for the provision of 911/E911
          services and for access to all subtending PSAPs. The dedicated trunks
          shall be, at minimum, DSO level trunks configured as a 2-wire analog
          interface or as part of a digital (1.544 Mbps) interface. Either
          configuration shall use CAMA type signaling with multifrequency (MF)
          tones that will deliver ANI with the voice portion of the call. At the
          request of ATTI, GTE will provide ATTI with the appropriate CLLI codes
          and specifications of the tandem office serving area. If an ATTI
          Central Office serves end users in an area served by more than one GTE
          911/E911 selective router, ATTI will install a minimum of two
          dedicated trunks in accordance with this section to each of such
          911/E911 selective routers.

35.6.2    TRANSPORT

          If ATTI desires to obtain transport from its end office to the GTE 911
          selective routers, ATTI may purchase such transport from GTE at the
          rates set forth in GTE's intrastate switched access tariff or in GTE's
          intrastate special access tariff.

35.6.3    COOPERATION AND LEVEL OF PERFORMANCE

35.6.3.1  The Parties agree to provide access to 911/E911 in a manner that is
          transparent to the end user. The Parties will work together to
          facilitate the prompt, reliable and efficient interconnection of
          ATTI's systems to the 911/E911 platforms to ensure that 911/E911
          service is fully available to ATTI's end users, with a level of
          performance that will provide the same grade of service as that which
          GTE provides to its own end users and that meets State requirements.
          To this end, GTE will provide documentation to ATTI showing the
          correlation of its rate centers to its E911 tandems.

35.6.3.2  In the event of an GTE or ATTI 911 trunk group failure, the Party
          that owns the trunk group will notify, on a priority basis, the other
          Party of such failure, which notification shall occur within two (2)


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                                                                         Page 49


          hours of the occurrence or sooner if required under Applicable Law.
          The Parties will exchange a list containing the names and telephone
          numbers of the support center personnel responsible for maintaining
          the 911 Service between the Parties.

35.6.3.3  When ATTI purchases transport, GTE will provide ATTI with the order
          number and the circuit identification code in advance of the service
          due date.

35.6.3.4  ATTI or its third party agent will provide CNA data to GTE for use in
          entering the data into the 911 data base. The initial CNA data will
          be provided to GTE in a format prescribed by NENA (National Emergency
          Number Association). ATTI is responsible for providing GTE updates to
          the CNA data and error corrections which may occur during the entry of
          CNA data to the GTE 911 Database System. GTE will confirm receipt of
          such data and corrections by close of business on the next Business
          Day by providing ATTI with a report of the number of items sent, the
          number of items entered correctly, and the number of errors.

35.6.3.5  ATTI will monitor the 911 circuits for the purpose of determining
          originating network traffic volumes. ATTI will notify GTE if the
          traffic study information indicates that additional circuits are
          required to meet the current level of 911 call volumes.

35.6.3.6  [Intentionally deleted.]

35.6.3.7  Inter-office trunks provided for 911 shall be engineered to assure
          minimum P.01 transmission grade of service as measured during the busy
          day/busy hour. A minimum of two trunks shall be provided by ATTI.

35.6.4    UPDATES TO MSAG

          It shall be the responsibility of ATTI to ensure that the address of
          each of its end users is included in the Master Street Address Guide
          ("MSAG") via information provided on ATTI's Local Service Request
          ("LSR") or via a separate feed established by ATTI and GTE pursuant to
          section 37.10.5 of this Article. Any MSAG change that appears to be
          required by ATTI must be approved by the County. Within thirty (30)
          days after the Effective Date of this Agreement, GTE shall provide
          ATTI with an initial electronic copy and a paper copy of the MSAG or
          its equivalent. Prior to the time that updates are available
          electronically, GTE will provide updates to ATTI on a monthly basis.
          Thereafter, GTE will provide updates to ATTI as changes are made.


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                                                                         Page 50


35.6.5    UPDATES TO DATABASE

          GTE and ATTI will work together to develop the process by which the
          911/E911 database will be updated with ATTI's end user 911/E911
          information. ATTI shall have the right to verify the accuracy of the
          information regarding ATTI's end users in the 911/E911 database.

35.6.6    COMPENSATION

          In situations in which GTE is responsible for maintenance of the
          911/E911 database and can be compensated for maintaining ATTI's
          information by the municipality, GTE will seek such compensation from
          the municipality. GTE will seek compensation from ATTI only if and to
          the extent that GTE is unable to obtain such compensation from the
          municipality.


<PAGE>

                                                                         Page 51


                                 PART V: PRICING

36.       GENERAL PRINCIPLES

          All services currently provided hereunder including resold Local
          Services, Network Elements and Combinations, and any new and
          additional services or Network Elements to be provided hereunder shall
          be priced in accordance with all applicable provisions of the Act and
          the rules and orders of the FCC and any state public utility
          commission having jurisdiction over this Agreement.

37.       PRICE SCHEDULES

37.1      LOCAL SERVICE RESALE

          The prices to be charged to ATTI for Local Services shall be as
          specified in Attachment 14.

37.2      UNBUNDLED NETWORK ELEMENTS

          The prices charged to ATTI for Unbundled Network Elements shall be as
          specified in Attachment 14 and shall be nondiscriminatory.

37.2.1    If implementation of an unbundled loop feeder supports shared used of
          required unbundling facilities, the cost of such facilities shall be
          allocated and prorated among all users in a non-discriminatory and
          competitively neutral manner. If such implementation supports only
          ATTI's use, then ATTI shall pay to GTE the incremental cost of such
          implementation.

37.2.2    If implementation of an unbundled loop concentrator /mutiplexer
          element supports shared used of required unbundling facilities, the
          cost of such facilities shall be allocated and prorated among all
          users in a non-discriminatory and competitively neutral manner. If
          implementation supports only ATTI's use, then ATTI shall pay to GTE
          the incremental cost of such implementation.

37.2.3    ATTI will be responsible for the costs (if any) required to create an
          interface at the main distribution frame if such interface does not
          already exist, such as in the case of an Integrated Digital Loop
          Carrier System.


<PAGE>

                                                                         Page 52


In witness whereof, the Parties have executed this Agreement through their
authorized representatives.

GTE Northwest Incorporated                  American Telephone Technology Inc.

By:                                         By:
   -----------------------------               ----------------------------
Signature                                   Signature

   -----------------------------               ----------------------------
Name                                        Name

   -----------------------------               ----------------------------
Title                                       Title

   -----------------------------               ----------------------------
Date                                        Date