MCI FOUNDED IN 1968

MCI: THE GROWTH COMPANY IN THE DYNAMIC TELECOMUNICATION INDUSTRY
COME GROW WITH US
Founded in 1968, MCI has won the right to offer U.S. business and government users a choice in the long distance telephone services they secure. The Company's own microwave radio system reaches coast-to-coast to serve metropolitan areas accounting for more than one-half of ail American telephones.
MCI is growing every day. It is expanding its system to new cities, broadening the line of its services to new markets, adding new customers daily to its network. Every day, the Company's penetration into the $15 Milieu long distance market deepens and intensifies.
And MCI needs people to grow with it, people with ail sorts of backgrounds, skills, and qualities. A brief leak at the enclosed Annual Report will give you an indication of the past and future growth of MCI. No nine-to-five routine. No hardened corporate arteries. The emphasis is on initiative, innovation, and diversity - on devising new ways to serve the customer better and more economically. The current staff has found this a thriving, satisfying environment. You might too.
MCI provides a truly comprehensive program designed to retain its most valuable resource, the MCI employee of Company paid testifies is a strong indication of the corporate commitment to MCI’s people and their future.
If you wane to participate in the challenging telecommunications industry, why not join its leader - became a part of MCI's excising environment, and watch for your future grow with us.

MCI BENEFITS

FULLY PAID .INSURANCE PLANS
Medical: Covers 80% of all doctor's care and prescriptions during illness, not just in-hospital care, after applicable deductible.
Dental: 80% Coverage for standard dental care, after applicable deductible.

Life Insurance; based on annual salary.
Disability; short and long term.
Accidental Death and Dismemberment: based on annual salary.
Dependent coverage available at nominal charge
EDUCATIONAL ASSISTANCE
Tuition and fees are reimbursed for approved job related courses or licenses (FCC license) upon satisfactory completion.
EMPLOYEE STOCK OWNERSHIP PLAN (HSOP)
Provides shares of MCI common stock depending upon years of service and total compensation.
EMPLOYES STOCK PURCHASE PLAN

Allows eligible employees to become stockholders of MCI or to increase their stockholdings in the Company through payroll deductions. This method is a convenient and more favorable way of acquiring shares o company stock than would otherwise be available to you on the open market.
PAID LEAVE

Vacation
Sick Leave
Holidays
SFECIAL BONUS

Recruitment Bonus
Employee Suggestion Bonus


For further information, contact your local MCI Representative or call the Personnel
Department at (202) 372-1600.

MCI HISTORY AT A GLANCE

- 1 -

1963 December: Microwave Communications, Inc. files application for common carrier microwave system between Chicago and St. Louis

1967 August: FCC Common Carrier Bureau supports grant of MCI application.


October: FCC Hearing Examiner issues initial decision to grant MCI application.
1968: August Microwave Communications of America, Inc. (now MCI Communications Corporation, "MCI") is organized to sponsor the development of affiliated regional common carrier applicants, whose interconnection forms a national specialized communications network.

December: President's Task Force on Communications Policy submits report backing specialized communications common carrier concept.

1969 August: In 4 - 3 Decision, FCC grants MCI construction permits for Chicago - St. Louis system.
September: MCI files first of sixteen additional MCI carrier applications to interconnect New York and Chicago.
1970 July: FCC issues Notice of Inquiry (Docket #18920) seeking comment on concept of competition from and among specialized common carriers.
December: One Hundred seventy-six separate organizations and individuals file comments with FCC in Docket #18920. One hundred sixty-six favor specialized common carriers; 10 carriers and their supporters oppose.
1971 January: Construction begins on MCI Chicago-St. Louis system.
May: In unanimous 7-0 Decision, FCC adopts policy favoring competition in specialized communications (Docket #18920), instructs staff to process applications in expedited manner.
October: FCC grants construction permits to MCI for New York -Washington, DC system. Authorizations granting coast-to-coast ^service follow in succeeding months.
1972 January: MCI inaugurates commercial service on Chicago -St. Louis link.

June: MCI public stock offering raises $33 million; Company also obtains $64 million bank credit agreement.

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1972 October: MCI, Comsat, and Lockheed Missile and Space Co. announce agreement on forming jointly-owned domestic satellite company.
November: Regional carriers begin to be merged into MCI Telecommunications Corporation, organized to assume MCI's common carrier responsibilities. (By July 1973, all but 4 of original 17 are merged into wholly-owned subsidiary.)
December: FCC approves jointly-owned satellite company's formation (Now CML Satellite).
1973 April: MCI acquires over 90% ownership in Microwave Communications, Inc., original Chicago - St. Louis regional carrier.
May: MCI Texas - East Microwave merged into MCI Telecommunications .
July: MCI issues first Annual Report to Stockholders.
July / August: Senate Antitrust and Monopoly Subcommittee holds hearings into communications industry.
September: Responding to an inquiry by the Commission, AT&T informs FCC of its intention to file tariffs applicable to the provision of local distribution facilities for specialized common carriers with state regulatory commissions rather than FCC.
October: MCI inaugurates commercial service in South Bend, Toledo and Cleveland.
MCI holds first Annual Meeting of Stockholders.
FCC, in letter signed by the Chairman, informs AT&T of the impropriety of its actions, further instructs Bell System to "promptly" file with FCC tariffs for interconnection facilities for specialized common carriers.
MCI inaugurates commercial service in Pittsburgh, Detroit, Newark and New York City.
MCI sells Spectrum Analysis & Frequency Planning ; subsidiary to Collins Radio Co.
AT&T's continuing refusal to provide interconnection facilities for MCI's customer’s forces reduction in staff of approximately sixty employees.

- 3 –

1973 November: MCI files in U.S. District Court in Philadelphia for injunctive relief to require AT&T to furnish local interconnections on regular and nondiscriminatory basis.
MCI petitions FCC to apply "fairness doctrine" to AT&T anticompetitive advertising, since public ultimately pays for such advertising.
Nonmember / December: MCI inaugurates commercial service in Philadelphia, Tulsa, Oklahoma City, Washington, Dallas and Baltimore.
December: Justice Department issues Civil Investigative Demand to AT&T regarding AT&T's response to competition.
FCC issues orders rejecting AT&T's request for hearing into competition and asking AT&T to "Show Cause" why it should not "cease and desist" carrying out a lengthy list of anticompetitive activities.
Continued delay in revenue production, directly attributable to AT&T's intransigence regarding interconnection, forces MCI to further reduce staff by approximately 150 employees.
U.S. District Court in Philadelphia grants injunctive relief against AT&T, requiring that all Bell System companies immediately provide MCI the interconnections it requires including those to FX (foreign exchange) and CCSA (common control switching arrangements).
1974 January: AT&T files in Third Circuit Court of Appeals for stay of mandatory injunction issued by District Court.
February: Third Circuit Court of Appeals refuses AT&T's request for stay. AT&T files for and is denied reconsideration by the full court. AT&T announces intention to comply with court order — pending appeal.
March: MCI and Nebraska-based regional carrier N-Triple-C, Inc. sign merger agreement effectively adding to the MCI network Kansas City, Houston, Minneapolis, Omaha and several other Midwest cities.
MCI files civil Antitrust suit in U.S. District Court in Chicago charging AT&T and Bell Operating Companies with violating Sherman Antitrust Act. •
April: Third Circuit Court of Appeals hears oral argument on appeal of preliminary injunction against AT&T, and then vacates that injunction, citing the FCC's prior jurisdiction and pending action in the case. AT&T immediately begins disconnecting MCI customers installed during period in which injunction was in effect.

- 4 –
1974 April: FCC issues "Cease and Desist" order directing AT&T to furnish, on a nondiscriminatory basis, all interconnections MCI requires. AT&T's subsequent motion for stay of FCC order is denied. AT&T begins reconnecting and installing required interconnections for MCI customers.
June: AT&T's Hi-Lo tariff — a direct response to competitors— goes into effect despite FCC's continuing request for delay pending further investigation.
June / July: Senate Antitrust and Monopoly Subcommittee holds further hearings into communications industry.
July: MCI installs 1,000th circuit/400,000 circuit mile with approximately 2,000 circuits in backlog waiting to be installed.
IBM announces intention to acquire from MCI and Lockheed 55% ownership in CML Satellite Corp., pending FCC approval.
September Third Circuit Court of Appeals rejects AT&T's appeal of FCC "Cease and Desist Order".
MCI revises its FCC Tariff No. 1 to provide for a new category of service called "metered use service" (Execunet).
October: AT&T, MCI and other carriers begin meetings at FCC to settle problems relating to interconnection fees and procedures.
MCI introduces "Quicklime" service to financial community.
November: Justice Department files Antitrust suit against AT&T.
Third Circuit Court of Appeals rejects AT&T's petition to reconsider its decision affirming FCC "Cease and Desist" order of April 1974.
December: MCI signs agreement with WTCI to operate communications facilities in Los Angeles, Phoenix, Tucson and San Diego.
1973 January: FCC rejects IBM-Comsat application to acquire joint
interest in CML Satellite Corp. while outlining
alternative plans under which reapplication would
be accepted.
MCI begins formal marketing of "Execunet" service for small business users.

- 5 –

1975 February: FCC gives "214" approval for MCI operation of WTCI system. Construction begins on link connecting MCI network in East and Midwest with West Coast.
MCI completes "overbuild" construction, tripling capacity on Chicago-New York Segment of its network.
March: FCC allows AT&T to increase interstate rates but by less than half of its January request; result is annual pretax profits for AT&T of $365 million.
AT&T signs agreement with MCI and other common carriers providing for reduced fees, more efficient procedures and additional technical cooperation in interconnection of customer circuits; effectively ends negotiations begun five months before at FCC (Docket #20099).
April: MCI files tariff at FCC requesting 8-1/2% increase in rates for private line voice and data services.
MCI introduces family of computerized telecommunication services: Telemanagement, Teleanalysis and Switched Private Line Service.
May: Having been accepted in April by FCC, negotiated agreement between AT&T, MCI and other carriers goes into effect.
MCI installs 6,000th circuit/2,000,000th circuit mile.
AT&T writes the FCC Chairman letter concluding that Execunet exceeds MCI's authority and asking the Commission to take action "to stop the unauthorized Execunet service".
June: MCI completes connecting links between its system and WTCI, becoming first specialized carrier to operate coast-to-coast system under its own control.
Supreme Court denies AT&T's request to review Court of Appeals decision affirming FCC "Cease and Desist" order of April 1974.
MCI is awarded first bulk competitive procurement of communications services ever undertaken by the U.S. Government.
July: FCC orders MCI to cease offering within 30 days its "Execunet" Service on grounds it is, in effect, message telecommunications service which MCI is not authorized to offer.

- 6 –
1975 July: U.S. Court of Appeals for the District of Columbia stays effective date of FCC order regarding "Execunet" until further notice.
MCI sells one-third interest in CML Satellite Corporation to Comsat General for $1.5 million.
September: MCI launches nationwide advertising campaign directed toward capturing the smaller, non-network customers.
MCI begins offering commercial service in San Francisco.
October: Supreme Court refuses to review FCC's "specialized carrier" decision.
November: MCI completes public offering of 1.2 million units consisting of four warrants and four shares of common stock. Net proceeds to the company are slightly over $8 million.
MCI requests that the FCC hold a special evidentiary hearing regarding the lawfulness of Execunet.
The FCC approves MCI's tariff revisions requesting rate structure changes and a 10% rate increase — effective date December 13, 1975.
Orville Wright is elected President and Chief Operating Officer of MCI Communications Corporation.
1975 January: MCI public stock offering raises $8.2 million.
The FCC rejects AT&T "Hi-Lo" rates on the grounds that they are not cost justified.
March: AT&T succeeds in having legislation introduced in both the House and Senate in an effort to thwart competition in the telephone industry.
MCI's new service offering - Telemanagement — is installed for CNA in Chicago, MCI's first customer.
April: MCI finalizes a lease agreement with Andrews Corpora-action providing MCI with $1 million in financing this year and $2 million next year.
The FCC temporarily suspends AT&T's Hi-Lo replacement tariff and orders an investigation into the legality of AT&T's new Multi-Schedule Private Line (MPL) rate structure.
An Oral Hearing is held concerning Execunet after which the FCC directs the Common Carrier Bureau to (what)? Next line below:

- 7 –
1976 May: write an order affirming their decision of July 2, 1975, that Execunet is not within the scope of MCI's authorized services.
Through an agreement with WTCI, Denver is being added to the MCI network by way of Omaha.
June: The FCC finds all revisions made by AT&T in connection with their WATS rates (filed since 1974) unlawful.
The Chicago - St. Louis overbuild is completed thus increasing its capacity from 1500 channels to 5400 channels.
New York's second Execunet switch becomes operational.
July: The FCC directs all common carriers to remove any sharing/reselling restrictions from their tariffs by September 1, 1976.
MCI files a formal complaint with the FCC stating that the Bell Companies have been overcharging them for local interconnection.
August: For the first time, MCI posts a positive income for operations during the first quarter of fiscal 1977.
MCI's CCSA tariff becomes effective.
September: MCI's Service 12 (metered-use tariff) becomes effective.
MCI's Shared Private Line Service (SPLS) tariff is rejected by the FCC, on the grounds that it is not within the lawful operating authority of MCI.

October: The Communications Subcommittee of the House Interstate and Foreign Commerce Committee holds "exploratory hearings" on competition in communications.
MCI achieves net income of $105,000 — the first month in its history for which positive results have been posted.
The U.S. Court of Appeals for the District of Columbia modifies the Execunet stay. It orders MCI not to solicit new Execunet customers after November 19, 1976, but allows MCI to maintain those currently in operation.
November: St. Louis, Missouri and Irving, Texas overbuild is completed.
December: MCI's third quarter ended December 31, 1976, reports a net income of $1,230,000 —- revenue of $16.3 million.

- 8 –

1977 February: The FCC approves two out of the three options provided in MCI's SPLS tariff.
March: MCI is listed in Standard and Poor's Directory.
The FCC rules that terminal equipment manufacturers are not required to use any of Bell's "protective" devices in interconnection if they register their equipment with the FCC.
AT&T files tariff modifications to cancel TELPAK (their bulk discount rates) effective June 8, 1977, due to the fact that it cannot exist in a selling and resale environment.
April: MCI finalizes negotiations with its five lending banks to stretch out repayment of their bank debt from 2.5 years to 7 years.
To more effectively compete with Bell's new MPL rates, MCI files tariff revisions to adjust its rates. MCI's average is now approximately 10% below Bell's MPL rates.
MCI presents an oral argument on Execunet at the U.S. Court of Appeals.
AT&T files a new tariff for WATS rates.
May: Construction is begun on the Ohio Valley System — approximately a $6 million project.
The U.S. Court of Appeals for the District of Columbia orders AT&T to continue supplying Telpak to existing customers under existing terms and conditions.
The Court of Appeals unanimously decides that MCI is entitled to offer its Execunet service over its authorized facilities, and remands the case to the FCC for further proceedings, if any. (Execunet I)
August: The Court of Appeals grants the stay of mandate sought by FCC and AT&T pending applications to the Supreme Court for writ of certiorari.
September: House Communications Subcommittee holds hearings on Consumer Communications Reform Act - the "Bell Bill". MCI testifies against the measure.
1977 November: MCI announces that its continued listing on the NASDAQ stock quotation system is in question because of the Company’s negative net worth.

- 9 -

U.S. Supreme Court declines to review the right of the Justice Department to press its antitrust action against AT&T.
1978 January:U.S. Supreme Court declines to review the Execunet decision. The mandate of the Court of Appeals issues and MCI may once again market Execunet.
AT&T tells the FCC that AT&T believes that it has no present obligation to make available to MCI additional local interconnections for Execunet.
MCI formally inaugurates service in Cincinnati, Dayton, and Columbus.
February: FCC agrees with AT&T that that Company is not presently required to make additional local interconnections available to MCI for Execunet expansion. MCI appeals this 6-1 decision to the Court of Appeals.
At the same time, FCC announces start of a new docket, MTS and WATS market structure inquiry, designed to determine whether there is any role for monopoly in that market.
House Communications Subcommittee agrees with its chairman, Lionel Van Deerlin of California, to undertake a "basement-to-attic" rewrite of the Communications Act of 1934.
April: The Court of Appeals directs the FCC to instruct AT&T that that Company must indeed make local interconnection available to MCI for Execunet expansion (Execunet II).
At the State level, the Texas Public Service Commission similarly orders Southwestern Bell to provide MCI the local interconnections it requires to expand Execunet on an intrastate basis.
May: The full Court of Appeals declines to hear the Execunet
case reargued, and FCC and AT&T press on the Supreme
Court. ;
U.S. Supreme Court denies FCC and AT&T a stay of the Court of Appeals order directing FCC to instruct AT&T to make available to MCI the local interconnections required for Execunet expansion. Execunet marketing and installation may once again resume.
AT&T files tariff for what it calls Exchange Network Facilities for Interstate Access (ENFIA), seeking to triple rates MCI pays for Execunet interconnections.

- 10 –

1978 May: Discovery in MCI's antitrust action against AT&T is completed.
June: MCI announces inauguration of Execunet in six new cities - Akron, Toledo, Columbus, Cincinnati, Dayton, and Wilmington - the filing of 10 additional cities for Execunet, and the revision of Execunet's rate to a flat 26.5 cents per minute of use.
House Communications Subcommittee releases text of the Communications Act rewrite in which competition is identified as the guiding principle for U.S. telecommunications .
FCC, in a major policy shift, instructs staff to process and grant all common carrier service and facility applications in routine manner, regardless of the :. . .__ applicant, conditioning licenses only on the final outcome of the Commission's inquiry into the MTS and WATS market structure.
July: House Communications Subcommittee commences extensive hearings on the Communications Act rewrite. MCI testifies that "rewrite reflects reality that there is no monopoly in intercity long distance".
August: FCC begins general investigation of MCI's Metered Use Service, which includes Execunet, and of the lawfulness of its tariff schedules.
September: MCI, AT&T and other interested parties begin a series of negotiations under FCC auspices to arrive at a mutually agreeable rate which specialized carriers will pay for switched service interconnection facilities. Major participants in these "ENFIA" negotiations include AT&T, GTE, OPASTCO, MCI, SPCC, ITT, USITA and NTIA.
November: U.S. Supreme Court declines to review Court of Appeals decision directing FCC to instruct AT&T to furnish MCI the interconnections required for Execunet expansion Execunet litigation is at an end.
December: MCI and other parties to the ENFIA negotiations sign an Interim Settlement Agreement which specifies the interim payments other common carriers are to make for access to the local exchange facilities of local telcos in providing Execunet/SPRINT-type interstate services.
MCI completes a public offering of 1,229,000 shares of new Convertible Preferred Stock at $25 per share, raising $28.6 million net to the Company.

- 11 –

1979 February: completed from Phoenix to Los Angeles.
March: Senate and House bills introduced to revise the 1934 Communications Act.
MCI's second route to the West Coast, from Salt Lake City to San Francisco, goes into operation.
April: FCC approves ENFIA Interim Settlement Agreement, and AT&T's ENFIA tariff becomes effective.
MCI files second antitrust suit against AT&T and some independent telcos for monopolizing the intercity telecommunications market in violation of the Sherman Act. This suit covers AT&T's monopolization efforts since 1975.
May: MCI officials testify before House and Senate subcommittees on common carrier sections of proposed legislation.
June: MCI realizes about $3.6 million from the exercise of 1.8 million warrants.
MCI introduces discounted evening and night rates in addition to a "multiple city maximum charge".
August: FCC asks for comments on what the market structure of MTS and WATS should be.
Customers are offered the use of an MCI Credit Card, /• which allows Execunet calls to be placed from 30 major cities using a universal credit card number.
September: MCI raises $69.5 million through sale of 4,950,000 shares of convertible preferred stock.
October: FCC begins inquiry whether "non-dominant" carriers like MCI should be freed from many present regulatory rules.
Per minute usage charges applicable to Execunet, Quick-line, and Network Service are increased by 4 percent. MCI introduces optional travel feature of Execunet which will compete favorably with AT&T's credit card calling.
November: MCI opens new switching centers in Phoenix, Cincinnati, and St. Louis and new terminals in New York and Chicago.
December: MCI provides its Execunet customers free Christmas Day calling and introduces $10 metered use service subscription fee which customer may substitute for present monthly minimum charge.

- 12 –

1980 January: Ending a five year-old inquiry, the FCC finds that competition in telephone private line and terminal equipment markets continues to benefit consumers.
February: MCI v. AT&T antitrust suit gets underway in Chicago.
FCC opens inquiry on permitting resale and sharing of AT&T's MTS and WATS services.
MCI limits to 15 the number of authorization codes available to each metered use service customer.
March: MCI begins offering residential long distance service in Denver and Cincinnati, and unleashes an extensive media advertising program.
April: The FCC proposes an access charge plan under which interexchange carriers would pay more to local carriers for the use of their facilities in providing all long distance services.
MCI offers a 70% night and weekend discount applicable to the distance-sensitive usage charges for its metered use service.
May: Acting under Court instructions, the FCC presents a schedule for settling the WATS tariff dispute by May 1981.
June: A Chicago jury returns a verdict in MCI's favor and awards the Company $600 million in damages (trebled under law to $1.8 billion) in its antitrust suit against AT&T.
July: The House Commerce Committee favorably reports a bill dealing with the regulation of telecommunications common carriers and the structure of the industry.
August: MCI receives net proceeds of $50.5 million from its public offering of debentures.
The FCC officially determines that competition, not monopoly, should be the standard for the MTS and WATS services market.
The FCC votes to eliminate various regulatory rules for non-dominant carriers.
Ronald A. Schaffer joins MCI Telecommunication in 1980 as a technical Service Reparative. TSR and had his FEDERAL COMMUNICATIONS COMMISSION RADIO TELEPHONE OPERATOR LICENSE Place and Date of Issuance: Denver, Colorado 23 November 1976
Date and Time Expiration: 23 November 1981 at Three O’clock A. M. Easter Stand Time. W.G. George & Ronald A. Schaffer
Ronschaffer@Deertrailco.net 11/14/2010 1:08:59 PM Today: Verizon's has joined forces with MCI Click Here