exv4w2



 







Exhibit 4.2




(FACE OF NOTE)



THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY. UNLESS AND UNTIL IT IS
EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM IN ACCORDANCE WITH THE PROVISIONS
OF THE INDENTURE AND THE TERMS OF THE SECURITIES, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.



UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO AT&T INC., OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE
& CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.




AT&T INC.




6.800% Notes due 2036




			
	 
	 	CUSIP NO. 00206R AB 8
	 	 	 
	 
	 	ISIN NO. US00206RAB87
	 	 	 
	No. R-1
	 	$500,000,000






     AT&T Inc., a corporation duly organized and existing under the laws of the State of Delaware
formerly known as SBC Communications Inc. (herein called “AT&T”, which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to
Cede & Co., or registered assigns, the principal sum of Five Hundred Million Dollars ($500,000,000)
on May 15, 2036 (the “Maturity Date”), and to pay interest on said principal sum from May 18, 2006
or from the most recent Interest Payment Date to which interest has been paid or duly provided for,
semi-annually in arrears on May 15 and November 15 in each year, commencing on November 15, 2006
(each an “Interest Payment Date”) and on the Maturity Date, at the interest rate of 6.800% per
annum, until the principal



 









 




hereof is paid or made available for payment. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of
business on the Regular Record Date for such interest, which shall be the close of business on May
1 or November 1, as the case may be (each, a “Regular Record Date”), next preceding such Interest
Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to
be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose
name this Note (or one or more Predecessor Notes) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Notes not less than 15 days prior to such Special Record Date,
or be paid at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed, and upon such notice as may be required by
such exchange, all as more fully provided in said Indenture.




     Any money that AT&T deposits with the Trustee or any Paying Agent for the payment of principal
or any interest on this Note that remains unclaimed for two years after the date upon which the
principal and interest are due and payable, will be repaid to AT&T upon AT&T’s request unless
otherwise required by mandatory provisions of any applicable unclaimed property law. After that
time, unless otherwise required by mandatory provisions of any unclaimed property law, the Holder
of this Note will be able to seek any payment to which such Holder may be entitled to collect only
from AT&T.



     If the Notes are issued in definitive form, payment of the principal and interest on this Note
due at the Maturity Date or upon redemption will be made at the Maturity Date or upon redemption,
as the case may be, upon presentation of this Note, in immediately available funds, at the office
of The Bank of New York, the Paying and Transfer Agent and Registrar for the Notes, currently
located at 101 Barclay Street, New York, New York 10286.



     Payment of interest on this Note due on an Interest Payment Date, other than interest at
maturity or upon redemption, may be paid by check mailed to the address of the Holder entitled
thereto as such address shall appear in the Note register. Notwithstanding the foregoing, (1) the
Depository as Holder of the Notes or (2) a Holder of more than U.S. $5,000,000 in aggregate
principal amount of Notes in definitive form is entitled to require the Paying Agent to make
payments of interest, other than interest due at maturity or upon redemption, by wire transfer of
immediately available funds into an account maintained by the Holder in the United States, by
sending appropriate wire transfer instructions as long as the Paying Agent receives the
instructions not less than ten days prior to the applicable Interest Payment Date.



     Reference is hereby made to the further provisions of this Note set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.



     Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.



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     IN WITNESS WHEREOF, AT&T Inc. has caused this instrument to be signed in its corporate name,
manually or by facsimile, by its duly authorized officers and has caused its corporate seal to be
imprinted hereon.



	 	 	 	 	 
	Dated:  May 18, 2006

[SEAL] 	AT&T INC.

 	 
	 	By:  	/s/
Richard G. Lindner	 
	 	 	Richard G. Lindner 	 
	 	 	Senior Executive Vice President and

Chief Financial Officer 	 
	 
	 	 	 
	 	By:  	/s/
Jonathan P. Klug	 
	 	 	Jonathan P. Klug 	 
	 	 	Vice President and Treasurer 	 
	 



Trustee’s Certificate of Authentication



This is one of the 6.800% Notes due 2036

of the series designated herein referred to

in the within-mentioned Indenture.



THE BANK OF NEW YORK, as Trustee




	 	 	 	 	 
	By:
	 	/s/ Beata Hryniewicka	 	 
	 

	 	 	 	 
	 

	 	Authorized Signatory
	 	 






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REVERSE OF NOTE




     This Note is one of a duly authorized issue of debt securities of AT&T of the series specified
on the face hereof, issued under and pursuant to an Indenture, dated as of November 1, 1994,
between AT&T and The Bank of New York, as Trustee (the “Trustee,” which term includes any successor
Trustee under the Indenture), to which indenture and all indentures supplemental thereto
(collectively, the “Indenture”) reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the Trustee, AT&T and the
Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and
delivered. The Notes will be issued in fully registered form only and in minimum denominations of
$2,000 and integral multiples of $1,000.



     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of AT&T and the rights of the Holders of the Notes
under the Indenture at any time by AT&T and the Trustee with the consent of the Holders of a
majority in principal amount of the Notes at the time outstanding. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount of the Notes at the
time outstanding to waive compliance by AT&T with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or waiver by the Holder
of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this
Note and of any Note issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon this Note.



     No reference herein to the Indenture and no provision of this Note or of the Indenture shall
alter or impair the obligation of AT&T, which is absolute and unconditional, to pay the principal
of and interest on this Note at the times, place and rate, and in the coin or currency, herein
prescribed.



     Registrar and Paying Agent



     AT&T shall maintain in the Borough of Manhattan, The City of New York, an office or agency
where Notes may be surrendered for registration of transfer or exchange (“Registrar”) and an office
or agency where Notes may be presented for payment or for exchange (“Paying Agent”). AT&T has
initially appointed the Trustee, The Bank of New York, as its Registrar and Paying Agent. AT&T may
vary or terminate the appointment of any of its paying or transfer agencies, and may appoint
additional paying or transfer agencies.



     Optional Redemption by AT&T



     The Notes will be redeemable, as a whole or in part, at AT&T’s option, at any time, on at
least 30 days’, but not more than 60 days’, prior notice mailed to the registered address of each
Holder of the Notes. The redemption prices will be equal to the greater of (1) 100% of the
principal amount of the Notes to be redeemed or (2) the sum of the present values of the Remaining
Scheduled Payments (as defined below) discounted to the redemption date, on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months), at a rate equal



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to the sum of the Treasury Rate (as defined below) and 25 basis points. In either case,
accrued interest will be payable to the redemption date.



     “Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the
semiannual equivalent yield to maturity or interpolation (on a day count basis) of the interpolated
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for such redemption
date.



     “Comparable Treasury Issue” means the United States Treasury security or securities selected
by an Independent Investment Banker as having an actual or interpolated maturity comparable to the
remaining term of the Notes to be redeemed that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate debt securities of
a comparable maturity to the remaining term of such Notes.



     “Independent Investment Banker” means one of the Reference Treasury Dealers, appointed by the
Trustee after consultation with AT&T.



     “Comparable Treasury Price” means, with respect to any redemption date, (1) the average of the
Reference Treasury Dealer Quotations for such redemption date after excluding the highest and
lowest of such Reference Treasury Dealer Quotations, or (2) if the Trustee obtains fewer than three
such Reference Treasury Dealer Quotations, the average of all such quotations.



     “Reference Treasury Dealer Quotations” means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Trustee, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by such Reference Treasury Dealer at 3:30 p.m., New York City
time, on the third Business Day preceding such redemption date.



     “Reference Treasury Dealer” means each of ABN AMRO Incorporated, Goldman, Sachs & Co. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated and their respective affiliates which are
primary U.S. Government securities dealers, and their respective successors and, at the option of
AT&T, other nationally recognized investment banking firms that are primary U.S. Government
securities dealers. If any of the foregoing or their affiliates shall cease to be a primary U.S.
Government securities dealer in The City of New York (a “Primary Treasury Dealer”), we shall
substitute therefore another Primary Treasury Dealer.



     “Remaining Scheduled Payments” means, with respect to each Note to be redeemed, the remaining
scheduled payments of principal of and interest on the Note that would be due after the related
redemption date but for the redemption. If that redemption date is not an interest payment date
with respect to a Note, the amount of the next succeeding scheduled interest payment on the Note
will be reduced by the amount of interest accrued on the Note to the redemption date.



     On and after the redemption date, interest will cease to accrue on the Notes or any portion of
the Notes called for redemption, unless AT&T defaults in the payment of the redemption price



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and accrued interest. On or before the redemption date, AT&T will deposit with a Paying Agent
or the Trustee money sufficient to pay the redemption price of and accrued interest on the Notes to
be redeemed on that date. If less than all of the Notes of any series are to be redeemed, the
Notes to be redeemed shall be selected by the Trustee by lot or by such other method as the Trustee
in its sole discretion deems to be fair and appropriate.



     Further Issues



     AT&T reserves the right from time to time, without notice to or the consent of the Holders of
the Notes, to create and issue further notes ranking equally and ratably with the Notes in all
respects, or in all respects except for the payment of interest accruing prior to the issue date or
except for the first payment of interest following the issue date of those further notes. Any
further notes will have the same terms as to status, redemption or otherwise as the Notes. Any
further notes shall be issued pursuant to a resolution of the board of directors of AT&T, a
supplement to the Indenture, or under an officers’ certificate pursuant to the Indenture.



     Notes in Definitive Form



     If (1) an Event of Default has occurred with regard to the Notes represented by this Note and
has not been cured or waived in accordance with the Indenture, or (2) the Depository is at any time
unwilling or unable to continue as depository and a successor depository is not appointed by AT&T
within 90 days, AT&T may issue notes in definitive form in exchange for this Note. In either
instance, an owner of a beneficial interest in the Notes will be entitled to the physical delivery
in definitive form in exchange for this Note, equal in principal amount to such beneficial interest
and to have such Notes registered in its name.



     Notes so issued in definitive form will be issued as registered notes in minimum denominations
of $2,000 and integral multiples of $1,000, unless otherwise specified by AT&T.



     Notes so issued in definitive form may be transferred by presentation for registration to the
Registrar at its New York office and must be duly endorsed by the Holder or the Holder’s attorney
duly authorized in writing, or accompanied by a written instrument or instruments of transfer in
form satisfactory to AT&T or the Trustee duly executed by the Holder or his attorney duly
authorized in writing.



     AT&T may require payment of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any exchange or registration of transfer of definitive
Notes.



     Default



     In case an Event of Default, as defined in the Indenture, shall have occurred and be
continuing, the principal hereof may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided in the Indenture.



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     Miscellaneous



     For purposes of the Notes, a Business Day means a day that is not a Saturday or Sunday and
that, in The City of New York, is not a day on which banking institutions are generally authorized
or obligated by law to close. If the date on which a payment of interest or principal is scheduled
to be paid is not a Business Day, then such interest or principal shall be paid on the next
succeeding Business Day and no additional interest shall accrue on the Notes from such originally
scheduled date for payment of principal or interest.



     No director, officer, employee or stockholder, as such, of AT&T shall have any liability for
any obligations of AT&T under this Note, the Indenture or for any claim based on, in respect of or
by reason of such obligations or their creation. Each Holder by accepting this Note waives and
releases all such liability. The waiver and release are part of the consideration for the issue of
this Note.



     The Notes are the unsecured and unsubordinated obligations of AT&T and will rank pari passu
with all other evidences of indebtedness issued in accordance with the Indenture.



     Notices to Holders of the Notes will be published in authorized newspapers in The City of New
York. AT&T is deemed to have given the notice on the date of each publication or, if published
more than once, on the date of the first publication.



     Prior to due presentment of this Note for registration of transfer, AT&T, the Trustee and any
agent of AT&T or the Trustee may treat the Person in whose name this Note is registered as the
owner hereof for all purposes, whether or not this Note be overdue, and neither AT&T, the Trustee
nor any such agent shall be affected by notice to the contrary.



     All terms used in this Note which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.



     The Indenture and this Note shall be governed by and construed in accordance with the laws of
the State of New York.




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