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Bell Atlantic Stock Compensation Plan - VERIZON COMMUNICATIONS INC - 3-28-1996

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Bell Atlantic Stock Compensation Plan - VERIZON COMMUNICATIONS INC - 3-28-1996 Powered By Docstoc
					BELL ATLANTIC STOCK COMPENSATION PLAN FOR OUTSIDE DIRECTORS Restated as of January 1, 1996, to incorporate amendments adopted through December 31, 1995 1. NAME OF PLAN. The plan shall be known as the Bell Atlantic Stock Compensation Plan for Outside Directors (and is referred to herein as the "Plan"). 2. OBJECTIVES OF THE PLAN. The objectives of the Plan are to encourage ownership of shares of the Common Stock (the "Stock") of Bell Atlantic Corporation (the "Corporation"), and to further align the interests of non- employee members of the boards of directors of Participating Companies with the interests of shareowners of the Corporation. 3. EFFECTIVE DATE. The effective date of the Plan is July 1, 1991. The Plan was submitted to, and was approved by, shareowners at the annual meeting of the Corporation in April 1991. 4. PARTICIPATING COMPANIES. The "Participating Companies" in the Plan shall be the Corporation and the domestic operating telephone company subsidiaries of the Corporation (the "OTCs"). 5. ELIGIBLE PARTICIPANTS. Each member of the board of directors of a Participating Company who is, as of the date of any award or grant hereunder, in active service as a director, but who is not then an employee of the Corporation or any subsidiary of the Corporation (each, an "Outside Director"), shall be eligible to receive an award or grant under the Plan. For purposes of certain provisions of Section 6 ("Stock Options"), a "Post-1/1/96 Outside Director" shall mean (a) each Outside Director who is first elected to the Board of Directors of the Corporation on or after January 1, 1996, and (b) each existing Outside Director as of December 31, 1995 who elected in January 1996 to forfeit his or her accrued pension benefit under the Bell Atlantic Retirement Plan for Outside Directors (the "Pension Plan") in exchange for the right to participate in stock option grants for Post1/1/96 Outside Directors under Sections 6(a) and 6(e) of this Plan. 6. STOCK OPTIONS (a) Annual Grant of Options. Commencing in January 1995, and annually thereafter, each individual who, at the close of the regular January meeting of the Board of Directors of the Corporation (the "Board"), is then serving as an Outside Director of the Corporation, except Post-1/1/96 Outside Directors, shall receive a grant of nonqualified stock options ("Options") to purchase 1,000 shares of Stock at an exercise price per Option equal to the fair market value of the Stock on the date of grant, and, effective January 1996, the number of such Options granted annually to each Post-1/1/96 Outside Director shall be 2,500. "Fair market value", for purposes of the previous sentence, shall have the same meaning as stated in the Bell Atlantic 1985 Incentive Stock Option Plan, as that plan may be amended from time to time (the "ISO Plan"). Options granted under this Plan shall be granted on the same date, and with the same exercise price, as the principal annual grant of options by the Human Resources Committee ("HRC") of the Board under the ISO Plan. Options shall be granted under this Plan automatically, and no action by the Board shall be required. The Board Stock Compensation Plan for Outside Directors Page 1 of 5

shall retain the authority in its sole discretion to revise, from time to time, the number of Options to be automatically granted annually under this Plan, provided, however, that no such action shall be taken without first obtaining the advice of counsel. (b) Initial Grant Upon Election to the Board. Effective as of the first day on which Stock is publicly traded in the calendar month first following the month in which an individual's initial election to the Board, as an Outside Director, becomes effective, the Outside Director shall receive a grant of Options to purchase 1,000 shares of

shall retain the authority in its sole discretion to revise, from time to time, the number of Options to be automatically granted annually under this Plan, provided, however, that no such action shall be taken without first obtaining the advice of counsel. (b) Initial Grant Upon Election to the Board. Effective as of the first day on which Stock is publicly traded in the calendar month first following the month in which an individual's initial election to the Board, as an Outside Director, becomes effective, the Outside Director shall receive a grant of Options to purchase 1,000 shares of Stock, with an exercise price equal to the fair market value of the Stock on said first trading day of said month. (c) Terms of Options. Options shall be subject to the following terms and conditions: (i) Options shall expire not later than the tenth anniversary of the date of grant; (ii) Options shall be subject to a waiting period of one year, and shall first become exercisable on the first anniversary of the date of grant; (iii) In the event of the retirement of an Outside Director from the Board upon having attained mandatory retirement age, or on account of disability, any outstanding Options which are not yet exercisable shall become exercisable on the day following the Outside Director's retirement, and all outstanding Options shall expire on the earlier of the fifth anniversary of the date of retirement or the tenth anniversary of the date of grant; (iv) In the event of a resignation or a termination of the service of an Outside Director from the Board for any reason other than disability or retirement upon having attained mandatory retirement age, any outstanding Options shall expire at the close of business on the effective date of said resignation; provided, however, that the Board may, in its discretion, take action to cause the Options of such an Outside Director to become exercisable, and/or to remain exercisable, for a period of time subsequent to said resignation or termination, but in no event may the Options remain exercisable after the later of the fifth anniversary of the last date of service as an Outside Director or the tenth anniversary of the date of grant; (v) In the event of the death of an Outside Director at a time when Options are outstanding, any such Options shall be exercisable until the earlier of the first anniversary of the date of death or the tenth anniversary of the date of grant; and (vi) The exercise price for Options shall be payable solely in cash. (d) Option Agreements. With respect to each grant of Options, the Plan Administrator, with the advice and assistance of counsel, shall have the authority, responsibility and discretion to prepare a form of agreement (the "Option Agreement") which shall state the terms and conditions stated in section 6(c) hereof, and such additional terms and conditions as the Plan Administrator determines are appropriate. In each case, the grant of Options to an Outside Director shall be conditioned on the Outside Director signing the corresponding Option Agreement within a period determined by the Plan Administrator. In the event that an Optionee does not deliver to the Plan Administrator a signed Option Agreement within an applicable period, or signs an Option Stock Compensation Plan for Outside Directors Page 2 of 5

Agreement which has been modified in a manner unacceptable to the Plan Administrator, the Optionee shall forfeit the Options stated on said Option Agreement. (e) Special Grant. Each incumbent Outside Director as of December 31, 1995, who elected on or before January 22, 1996 to forfeit his or her accrued benefit under the Pension Plan in exchange for eligibility to receive Option grants as a Post-1/1/96 Outside Director, shall receive, on January 22, 1996, in addition to the grant described in Section 6(a), a one-time grant of Options in an amount equal to the product of (i) 1,500, times (ii) the Outside Director's years of service, as of that date of grant, as determined under the terms of the Pension Plan. (f) Adjustments in Stock. Notwithstanding any other provision of this Plan, in a transaction to which section 424

Agreement which has been modified in a manner unacceptable to the Plan Administrator, the Optionee shall forfeit the Options stated on said Option Agreement. (e) Special Grant. Each incumbent Outside Director as of December 31, 1995, who elected on or before January 22, 1996 to forfeit his or her accrued benefit under the Pension Plan in exchange for eligibility to receive Option grants as a Post-1/1/96 Outside Director, shall receive, on January 22, 1996, in addition to the grant described in Section 6(a), a one-time grant of Options in an amount equal to the product of (i) 1,500, times (ii) the Outside Director's years of service, as of that date of grant, as determined under the terms of the Pension Plan. (f) Adjustments in Stock. Notwithstanding any other provision of this Plan, in a transaction to which section 424 (a) of the Internal Revenue Code applies, the Board of Directors shall determine whether, and to what extent, it is appropriate to make adjustments in the class or issuer of stock subject to outstanding Options under the Plan, and/or in the number and corresponding exercise prices of outstanding Options, in order to preserve the aggregate value of the spreads between the exercise prices of the outstanding Options and the value of the applicable Stock or stocks. Such modifications shall be consistent with the terms of any such reorganization, recapitalization, stock split, stock dividend, combination of shares, or any other change affecting the Stock. 7. STOCK AWARDS. (a) Annual Awards. On the first business day of July of each year, each Participating Company except the Corporation shall cause to be transferred to each of its Outside Directors who is on that day in active service as an elected Outside Director of the Participating Company, an award of Stock (and cash in lieu of any fractional share) for services to be rendered as an Outside Director for the twelve-month period on and after that date (or for any portion of said twelve-month period during which the Outside Director remains on the respective board). (b) Value of Awards. For Outside Directors of Participating Companies other than the Corporation, the annual Stock award shall be a number of whole shares (and cash in lieu of any fractional share) the value of which shall equal $1,000. For purposes of computing the number of shares to be awarded, the value of a share of Stock at the time of an award shall be deemed to be equal to the average of the closing prices of the Stock for each of the last five trading days of the month of June immediately preceding the date of the award. (c) Election to Transfer Shares to DRSPP. Each Outside Director who is eligible for an award of Stock under this section 7 shall, prior to the date of the award for a given year, have the right to elect whether to receive the award in the form of a share certificate, which shall be solely in the name of the Outside Director, or to have the Corporation deposit the share award directly into an account, which shall be solely in the name of the Outside Director, under the Corporation's Dividend Reinvestment and Stock Purchase Plan ("DRSPP"). For an Outside Director who elects to deposit the award in a DRSPP account, the terms of DRSPP shall thereafter apply and the shares awarded under this Plan shall be treated no differently than any other shares held under DRSPP. Stock Compensation Plan for Outside Directors Page 3 of 5

(d) No Accrued Interest In Subsequent Awards. Until the applicable award date under the Plan, an eligible Outside Director shall have no accrued right to receive all or any portion of any subsequent award, except to the extent provided in any plan amendment adopted by the Plan Administrator pursuant to Section 12(c)(iii). An eligible Outside Director shall have no right to assign or alienate any interest in any award which has not yet been presented under this Plan. 8. SOURCE OF STOCK. Shares of Stock awarded under the Plan, and Stock transferred to an Outside Director upon exercise of Options, may be treasury shares, or authorized but unissued shares, or outstanding shares of Stock acquired by the Corporation in the open market or elsewhere. 9. TAXES. Any and all tax consequences for an Outside Director which are associated with an award of shares or an exercise of Options under this Plan shall be the sole responsibility of the participating Outside Director. 10. AUTHORIZED NUMBER OF SHARES. The aggregate number of shares of Stock which may be awarded

(d) No Accrued Interest In Subsequent Awards. Until the applicable award date under the Plan, an eligible Outside Director shall have no accrued right to receive all or any portion of any subsequent award, except to the extent provided in any plan amendment adopted by the Plan Administrator pursuant to Section 12(c)(iii). An eligible Outside Director shall have no right to assign or alienate any interest in any award which has not yet been presented under this Plan. 8. SOURCE OF STOCK. Shares of Stock awarded under the Plan, and Stock transferred to an Outside Director upon exercise of Options, may be treasury shares, or authorized but unissued shares, or outstanding shares of Stock acquired by the Corporation in the open market or elsewhere. 9. TAXES. Any and all tax consequences for an Outside Director which are associated with an award of shares or an exercise of Options under this Plan shall be the sole responsibility of the participating Outside Director. 10. AUTHORIZED NUMBER OF SHARES. The aggregate number of shares of Stock which may be awarded under this Plan, or transferred upon exercise of Options, shall be 100,000. Said limit shall be adjusted, in the manner determined appropriate by the Plan Administrator with the advice of counsel, in the event of any stock split, stock dividend, recapitalization, or other change affecting the Stock. 11. NO EFFECT ON RETIREMENT PLAN OR DEFERRED FEE PLAN. The awards of Stock, and transfers of Stock upon exercise of Options, under this Plan shall not be treated as a portion of the Outside Directors' retainer, or as benefit bearing compensation of any kind, for purposes of determining the amount of any benefit under the Bell Atlantic Retirement Plan for Outside Directors. Neither the Options nor the Stock received under this Plan shall be eligible for deferral under the Bell Atlantic Deferred Fee Plan for Outside Directors. 12. ADMINISTRATION; AMENDMENT AND TERMINATION. (a) Authority of the Board. The Board of the Corporation shall have the authority to amend and to terminate the Plan at any time in its discretion; provided, however, that any amendment adopted by the Board may be submitted for approval by the shareowners of the Corporation if, in the opinion of counsel, such approval is required to exempt the awards of Stock, and the grant or exercise of Options, under this Plan from the shortswing trading provisions of Section 16 of the Securities Exchange Act of 1934, or to preserve the status of Outside Directors as "disinterested administrators" (within the meaning of regulations issued pursuant to said Section 16) for purposes of the Corporation's compensation plans for officers and key employees. The Committee on Directors of the Board may recommend amendments to the Plan for the approval of the full Board. (b) Authority of Board of Directors of Operating Telephone Companies. The board of directors of an OTC shall have the authority to adopt the Plan on behalf of the OTC, and to withdraw from participation in the Plan at any time in its sole discretion. (c) Authority of Plan Administrator. The Vice President - Human Resources of the Corporation, or any person to whom that officer delegates administrative responsibility for Stock Compensation Plan for Outside Directors Page 4 of 5

the Plan, shall be the "Plan Administrator" (as that term is used herein), with the authority (i) to administer and interpret the Plan, (ii) to prepare and distribute Option Agreements and administer the exercise of Options, (iii) to adopt minor and administrative modifications of the Plan and amendments which the Plan Administrator believes, with the advice of counsel, to be necessary or appropriate to comply with changes in applicable law or to ensure that transactions under the Plan remain exempt from Section 16(b) of the Securities Exchange Act of 1934 to the maximum extent practicable, (iv) to adopt Plan provisions for the awarding of prorated amounts of Stock in appropriate circumstances, and (v) with advice of counsel, to submit the Plan, or amendments to the Plan, to the shareowners of the Corporation for approval. (d) Authority of Corporate Secretaries of OTCs. The corporate secretary of each OTC shall have the status of deputy administrator of the Plan, with authority to assist the Plan Administrator with communications and

the Plan, shall be the "Plan Administrator" (as that term is used herein), with the authority (i) to administer and interpret the Plan, (ii) to prepare and distribute Option Agreements and administer the exercise of Options, (iii) to adopt minor and administrative modifications of the Plan and amendments which the Plan Administrator believes, with the advice of counsel, to be necessary or appropriate to comply with changes in applicable law or to ensure that transactions under the Plan remain exempt from Section 16(b) of the Securities Exchange Act of 1934 to the maximum extent practicable, (iv) to adopt Plan provisions for the awarding of prorated amounts of Stock in appropriate circumstances, and (v) with advice of counsel, to submit the Plan, or amendments to the Plan, to the shareowners of the Corporation for approval. (d) Authority of Corporate Secretaries of OTCs. The corporate secretary of each OTC shall have the status of deputy administrator of the Plan, with authority to assist the Plan Administrator with communications and correspondence with Outside Directors of the respective OTC.

Stock Compensation Plan for Outside Directors Page 5 of 5

Exhibit 10(n) EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT is made this 2nd day of May, 1995, by and between Bell Atlantic Corporation ("Bell Atlantic") and Lawrence T. Babbio, Jr. (the "Executive"). WHEREAS, Bell Atlantic seeks to retain the services of the Executive and to provide for an efficient transition upon any change in the Chief Executive Officer of Bell Atlantic; WHEREAS, the Executive is willing to remain in the employ of Bell Atlantic upon the following terms and conditions; and WHEREAS, Bell Atlantic and the Executive wish to set forth their agreement as to the terms and conditions upon which the Executive's employment will continue. NOW, THEREFORE, for good and valuable consideration, including the compensation and benefits recited below, the Executive and Bell Atlantic hereby agree as follows: 1. Definitions: (a) Effective Date shall mean the announced effective date of the election of any individual to succeed the person who, on the date of this Agreement, is the incumbent Chief Executive Officer of Bell Atlantic. (b) Bell Atlantic Companies shall mean Bell Atlantic and each corporate subsidiary and other affiliated company in which Bell Atlantic directly or indirectly owns a fifty percent or greater interest. (c) Board shall mean the board of directors of Bell Atlantic. (d) Chief Executive Officer shall mean the Chief Executive Officer of Bell Atlantic, as elected and serving from time to time. (e) Committed Employment Period shall mean the period commencing on the date of this Agreement and continuing until the earlier of the second anniversary of the Effective Date or July 1, 1998. (f) Release shall mean a legal release in the form attached to this Agreement as Exhibit A, which shall be signed by the Executive at the time of his retirement from Bell Atlantic as a condition of receiving any and all pension and severance benefits provided under the terms of this Agreement. 2. Termination of this Agreement: In the event that the Executive is elected Chief Executive Officer as of the

Exhibit 10(n) EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT is made this 2nd day of May, 1995, by and between Bell Atlantic Corporation ("Bell Atlantic") and Lawrence T. Babbio, Jr. (the "Executive"). WHEREAS, Bell Atlantic seeks to retain the services of the Executive and to provide for an efficient transition upon any change in the Chief Executive Officer of Bell Atlantic; WHEREAS, the Executive is willing to remain in the employ of Bell Atlantic upon the following terms and conditions; and WHEREAS, Bell Atlantic and the Executive wish to set forth their agreement as to the terms and conditions upon which the Executive's employment will continue. NOW, THEREFORE, for good and valuable consideration, including the compensation and benefits recited below, the Executive and Bell Atlantic hereby agree as follows: 1. Definitions: (a) Effective Date shall mean the announced effective date of the election of any individual to succeed the person who, on the date of this Agreement, is the incumbent Chief Executive Officer of Bell Atlantic. (b) Bell Atlantic Companies shall mean Bell Atlantic and each corporate subsidiary and other affiliated company in which Bell Atlantic directly or indirectly owns a fifty percent or greater interest. (c) Board shall mean the board of directors of Bell Atlantic. (d) Chief Executive Officer shall mean the Chief Executive Officer of Bell Atlantic, as elected and serving from time to time. (e) Committed Employment Period shall mean the period commencing on the date of this Agreement and continuing until the earlier of the second anniversary of the Effective Date or July 1, 1998. (f) Release shall mean a legal release in the form attached to this Agreement as Exhibit A, which shall be signed by the Executive at the time of his retirement from Bell Atlantic as a condition of receiving any and all pension and severance benefits provided under the terms of this Agreement. 2. Termination of this Agreement: In the event that the Executive is elected Chief Executive Officer as of the Effective Date, this Agreement shall then terminate and shall be of no further force or effect. 3. Bell Atlantic Obligations during the Committed Employment Period: During the Committed Employment Period: Employment Agreement Page 1

(a) Bell Atlantic shall continue to employ the Executive as a Bell Atlantic officer with the title of Vice Chairman, with duties of a type and level appropriate to such a title; (b) Bell Atlantic shall compensate the Executive at a Salary Grade not less than 37, and, to the extent not otherwise modified by the terms of this Agreement, the Executive shall be eligible to participate in all of the benefit and compensation plans, and the programs of perquisites, applicable to similarly-situated Senior Managers of Bell Atlantic, as those plans and programs may be amended from time to time; (c) The Board shall nominate the Executive for election as a director at each annual meeting of shareowners of Bell Atlantic which occurs during the Committed Employment Period; and

(a) Bell Atlantic shall continue to employ the Executive as a Bell Atlantic officer with the title of Vice Chairman, with duties of a type and level appropriate to such a title; (b) Bell Atlantic shall compensate the Executive at a Salary Grade not less than 37, and, to the extent not otherwise modified by the terms of this Agreement, the Executive shall be eligible to participate in all of the benefit and compensation plans, and the programs of perquisites, applicable to similarly-situated Senior Managers of Bell Atlantic, as those plans and programs may be amended from time to time; (c) The Board shall nominate the Executive for election as a director at each annual meeting of shareowners of Bell Atlantic which occurs during the Committed Employment Period; and (d) In the event that the Executive does not become Chief Executive Officer on the Effective Date, Bell Atlantic shall, as of the Effective Date, promote the Executive to Salary Grade 38, and shall for the remainder of the Committed Employment Period deliver compensation, benefits and perquisites to the Executive commensurate with that Salary Grade, including, without limitation, annual base salary increases not less than one-third of the amount by which the mid-point of Salary Grade 38 exceeds the Executive's initial salary upon promotion to that Salary Grade. (e) In the event that James G. Cullen is elected Chief Executive Officer as of the Effective Date, the Executive will be elected Vice Chairman and Chief Operating Officer of Bell Atlantic effective as of the Effective Date, and Bell Atlantic shall retain the Executive in that position, with duties commensurate with that title, through the end of the Committed Employment Period. 4. Obligations of the Executive during the Committed Employment Period: During the Committed Employment Period, the Executive shall have the following obligations and duties. (a) The Executive shall continue to fully and faithfully perform his duties and responsibilities (i) as a director, so long as he is elected and serving, and (ii) as an officer, reporting only to the Chief Executive Officer and the Board. (b) The Executive shall serve in such executive capacities, titles and authorities with respect to the Bell Atlantic Companies as the Board or the CEO may from time to time prescribe, and the Executive shall perform all duties incidental to such positions, shall cooperate fully with the Board and the CEO, and shall work cooperatively with the other officers of the Bell Atlantic Companies. (c) The Executive shall continue to diligently devote his entire business skill, time and effort to the affairs of the Bell Atlantic Companies in accordance with the duties assigned to him that are not inconsistent with the terms hereof, and shall perform all such duties, and otherwise conduct himself, in a manner reasonably calculated in good faith by him to promote the best interests of the Bell Atlantic Companies. Prior to the Executive's retirement from Bell Atlantic, except to the extent specifically permitted by the Chief Executive Officer or the Board and except as set forth below, the Officer shall not, directly or indirectly, render any services of a Employment Agreement Page 2

business, commercial or professional nature to any other person or organization other than a Bell Atlantic Company or a venture in which a Bell Atlantic Company has a financial interest, whether or not the services are rendered for compensation. However, the Executive is not prohibited from serving on committees or boards of charitable, educational, civic or other nonprofit organizations, so long as such service does not interfere with his full-time responsibilities to Bell Atlantic. (d) The failure of the Executive to perform his obligations pursuant to paragraphs (a) through (c) above shall be excused when such failure is on account of the Executive's disability within the meaning of the applicable disability benefit plans in which the Executive participates from time to time. 5. Retirement. If the Executive is not elected Chief Executive Officer as of the Effective Date, the Executive hereby agrees, at any time after the last day of the Committed Employment Period, upon request of the thencurrent Chief Executive Officer or the Board, to retire from active service with Bell Atlantic, effective as of the

business, commercial or professional nature to any other person or organization other than a Bell Atlantic Company or a venture in which a Bell Atlantic Company has a financial interest, whether or not the services are rendered for compensation. However, the Executive is not prohibited from serving on committees or boards of charitable, educational, civic or other nonprofit organizations, so long as such service does not interfere with his full-time responsibilities to Bell Atlantic. (d) The failure of the Executive to perform his obligations pursuant to paragraphs (a) through (c) above shall be excused when such failure is on account of the Executive's disability within the meaning of the applicable disability benefit plans in which the Executive participates from time to time. 5. Retirement. If the Executive is not elected Chief Executive Officer as of the Effective Date, the Executive hereby agrees, at any time after the last day of the Committed Employment Period, upon request of the thencurrent Chief Executive Officer or the Board, to retire from active service with Bell Atlantic, effective as of the date specified in the request. The parties acknowledge that Bell Atlantic shall have the right to cause the Executive to be retired and removed from active service as of any date after the last day of the Committed Employment Period. On the date of such retirement, as a condition of eligibility to receive the pension and severance benefits described in Sections 6 and 7 of this Agreement, the Executive shall sign and deliver the Release and shall not revoke his signature. 6. Retirement Pension Benefits. (a) Eligibility for Waiver of Early Retirement Pension Discount. If a person other than the Executive is elected Chief Executive Officer as of the Effective Date, and if the Executive thereafter completes the Committed Employment Period by remaining in active service with Bell Atlantic in accordance with the terms of this Agreement, the Executive shall at any time thereafter be entitled, subject to signing and delivering the Release, to retire with a two-year waiver of any applicable early retirement pension discount under the terms of the Bell Atlantic Senior Management Retirement Income Plan or any successor to that plan which applies to Senior Managers, as that plan may be amended from time to time ("RIP"), as more fully described in the following paragraph. The parties acknowledge that the pension enhancement described in this Section is part of the consideration given by Bell Atlantic in exchange for the Release and the non-compete and proprietary information covenants granted by the Executive under Sections 10 and 11 of this Agreement. (b) Calculation of Waiver of Early Retirement Pension Discount. If the Executive qualifies for the waiver of early retirement pension discount, as described in the previous paragraph, the Executive's target pension under RIP shall be equal to the greater of: (i) The target pension determined under the applicable pension formula under RIP which is in effect and applicable to the Executive at the time of the Executive's retirement, after adding two additional years to the Executive's age at the time of retirement for purposes of determining the amount of any applicable early retirement discount (but not for any other purpose under RIP); or Employment Agreement Page 3

(ii) The target pension which would have been applicable to the Executive if he had retired at any time during the Committed Employment Period, under the terms of any early retirement incentive, pension window, or other special provision of RIP which may then have been in effect but which is no longer in effect at the time of the Executive's actual retirement. In such a case, the calculation of the RIP enhanced benefit shall not be subject to further supplementation by the discount waiver provisions of the prior paragraph. 7. Further Consideration for Non-Compete Agreement: (a) If a person other than the Executive is elected Chief Executive Officer as of the Effective Date, and if the Executive thereafter completes the Committed Employment Period by remaining in active service with Bell Atlantic in accordance with the terms of this Agreement, then, subject to the Executive signing and delivering the Release, Bell Atlantic shall pay the Executive a cash severance payment, as described in the following paragraph, upon the Executive's retirement at any time thereafter. The parties acknowledge that the severance payment

(ii) The target pension which would have been applicable to the Executive if he had retired at any time during the Committed Employment Period, under the terms of any early retirement incentive, pension window, or other special provision of RIP which may then have been in effect but which is no longer in effect at the time of the Executive's actual retirement. In such a case, the calculation of the RIP enhanced benefit shall not be subject to further supplementation by the discount waiver provisions of the prior paragraph. 7. Further Consideration for Non-Compete Agreement: (a) If a person other than the Executive is elected Chief Executive Officer as of the Effective Date, and if the Executive thereafter completes the Committed Employment Period by remaining in active service with Bell Atlantic in accordance with the terms of this Agreement, then, subject to the Executive signing and delivering the Release, Bell Atlantic shall pay the Executive a cash severance payment, as described in the following paragraph, upon the Executive's retirement at any time thereafter. The parties acknowledge that the severance payment described in this Section is part of the consideration given by Bell Atlantic in exchange for the Release and the non-compete and proprietary information covenants granted by the Executive under Sections 10 and 11 of this Agreement. (b) The severance benefit described in the previous paragraph shall be equal to two times the sum of (i) the annualized amount of the Executive's then-current base salary, plus (ii) the greatest of (A) the value of the Executive's most recent award of cash and deferred stock under the Senior Management Short Term Incentive Plan or any successor to that plan (the "STIP"), or (B) the value of the most recent award of cash and deferred stock under the STIP for the Executive's salary grade without taking into account any individual performance adjustments to the award, or (C) 150% of the target STIP award for the Executive's salary grade as of the date of retirement. This cash separation benefit shall be payable in one installment, not later than 30 days after the termination of employment date, subject to the Executive's continuing compliance with the terms of this Agreement. 8. Retirement or Discharge for Cause during Committed Employment Period. (a) In the event that the Executive voluntarily resigns or retires for any reason (except a "constructive discharge", as defined in Section 9(c)), or is discharged by Bell Atlantic for "cause" (as hereinafter defined), prior to the end of the Committed Employment Period, the Executive shall forfeit any and all rights to receive the special supplementary pension benefits and the severance benefits set forth in Sections 6 and 7 of this Agreement, but shall otherwise be eligible to receive any and all compensation and benefits for which a similarly-situated retiring Senior Manager would be eligible under the applicable provisions of the compensation and benefit plans, as those plans may be amended from time to time. In such event, the Executive shall be subject to the terms of the covenant not to compete, as described in Section 10 of this Agreement, for a period which shall extend from the actual date of retirement through the second anniversary of the end of the Committed Employment Period. (b) For purposes of this Agreement, the term "cause" shall mean a violation of law (other than a traffic violation or other minor civil offense), or behavior that Bell Employment Agreement Page 4

Atlantic concludes amounts to a material breach of any company policy or provision of the Employee Code of Business Conduct, and including, by way of example: dishonesty; working outside the Bell Atlantic Companies in violation of Section 4(c) or 10 of this Agreement in competition with any Bell Atlantic Company; other conduct that poses a material conflict of interest; revealing confidential or proprietary information of any Bell Atlantic Company in violation of Section 11 of this Agreement; or a substantial and deliberate abuse of the voucher or expense reimbursement processes of any Bell Atlantic Company. 9. Certain Involuntary Terminations of Employment: (a) Consequences of Certain Involuntary Terminations. Except in the case of a discharge for cause, in the event that Bell Atlantic involuntarily discharges the Executive, or the Executive is "constructively discharged" (as hereinafter defined), prior to the end of the Committed Employment Period, then the Executive shall be entitled to receive, as liquidated damages, subject to signing and delivering the Release, an amount of cash equal to the

Atlantic concludes amounts to a material breach of any company policy or provision of the Employee Code of Business Conduct, and including, by way of example: dishonesty; working outside the Bell Atlantic Companies in violation of Section 4(c) or 10 of this Agreement in competition with any Bell Atlantic Company; other conduct that poses a material conflict of interest; revealing confidential or proprietary information of any Bell Atlantic Company in violation of Section 11 of this Agreement; or a substantial and deliberate abuse of the voucher or expense reimbursement processes of any Bell Atlantic Company. 9. Certain Involuntary Terminations of Employment: (a) Consequences of Certain Involuntary Terminations. Except in the case of a discharge for cause, in the event that Bell Atlantic involuntarily discharges the Executive, or the Executive is "constructively discharged" (as hereinafter defined), prior to the end of the Committed Employment Period, then the Executive shall be entitled to receive, as liquidated damages, subject to signing and delivering the Release, an amount of cash equal to the compensation and benefits which he would have been entitled to receive had Bell Atlantic fulfilled its obligation to employ the Executive in accordance with the provisions of Section 3 of this Agreement, calculated and paid in accordance with paragraph (b) of this Section. In such a case, in addition to the liquidated damages described in the previous sentence, subject to signing and delivering the Release, the Executive shall be entitled to receive the benefits set forth in Sections 6 and 7 of this Agreement, but calculated as though the Executive had actually remained in active service with Bell Atlantic, earning the compensation described in Section 3 of this Agreement, until the end of the Committed Employment Period, with the payment of the cash separation benefit under Section 7 to be made within 30 days after the termination of employment date. Under the circumstances described in this paragraph, the Executive shall be subject to the non-compete covenants of this Agreement through the period ending on the second anniversary of the date of termination of the Executive's employment. (b) Calculation and Payment of Liquidated Damages. The liquidated damages described in the first sentence of the previous paragraph shall consist of all five of the following items, but only the following items. All of the following items of liquidated damages shall be subject to applicable withholding taxes. Each payment contemplated by this subsection (b) shall be contingent upon the absence, as of the time of such payment, of any knowing and material violation by the Executive of any of the covenants contained in Sections 10 and 11. (i) Salary: The liquidated damages shall be paid monthly in cash, in an amount each month equal to the salary which would have been paid to the Executive under Section 3 of this Agreement, assuming salary adjustments annually at a percentage equal to the merit increase budget percentage for Bell Atlantic Senior Managers. (ii) Short-Term Incentives: The liquidated damages for foregone short-term incentives under STIP shall be paid annually in cash, not later than 30 days after the date on which incentives are awarded by Bell Atlantic under the STIP for the prior year's performance, in an amount equal to the value of the cash and deferred stock which the Executive would have been entitled to receive under the STIP, without adjustment for individual performance. Employment Agreement Page 5

(iii) Long-Term Incentives: The liquidated damages for foregone long- term incentives shall be paid annually in cash, within 30 days of the granting of stock options for the year, in an amount equal to the Black-Scholes value of options which the Executive would have been entitled to receive. (iv) RIP Pension Benefits: The RIP target pension will be recalculated after the completion of the Committed Employment Period taking into account the liquidated damages under paragraphs (i) and (ii) above as though they were earned as salary and short-term incentives during a period of employment ending on the last day of the Committed Employment Period, and (A) Bell Atlantic shall pay the Executive a true-up payment based on said recalculation if the Executive has elected a lump-sum payment of the benefit provided by Section 6(a), and (B) if the Executive has elected a pension in the form of an annuity, the Executive's RIP pension benefits thereafter shall be based on said recalculation. (v) Miscellaneous Benefits: The liquidated damages for all other foregone benefits shall be paid monthly in an amount equal to the sum of: (A) the BellFlex allowance that the Executive would have been entitled to receive, plus (B) one-twelfth of the annual maximum company matching contribution that the Executive would have been

(iii) Long-Term Incentives: The liquidated damages for foregone long- term incentives shall be paid annually in cash, within 30 days of the granting of stock options for the year, in an amount equal to the Black-Scholes value of options which the Executive would have been entitled to receive. (iv) RIP Pension Benefits: The RIP target pension will be recalculated after the completion of the Committed Employment Period taking into account the liquidated damages under paragraphs (i) and (ii) above as though they were earned as salary and short-term incentives during a period of employment ending on the last day of the Committed Employment Period, and (A) Bell Atlantic shall pay the Executive a true-up payment based on said recalculation if the Executive has elected a lump-sum payment of the benefit provided by Section 6(a), and (B) if the Executive has elected a pension in the form of an annuity, the Executive's RIP pension benefits thereafter shall be based on said recalculation. (v) Miscellaneous Benefits: The liquidated damages for all other foregone benefits shall be paid monthly in an amount equal to the sum of: (A) the BellFlex allowance that the Executive would have been entitled to receive, plus (B) one-twelfth of the annual maximum company matching contribution that the Executive would have been eligible to receive if the Executive made the maximum contributions to the Bell Atlantic Savings Plan then permitted by law. (c) Constructive Discharge: The Executive shall be deemed to have been "constructively discharged" for purposes of this Agreement, if, in the absence of conduct amounting to cause for discharge on the part of the Executive, and without the Executive's express written consent, any of the following events has occurred within 12 months prior to the Executive electing to retire: (i) the Executive's status as a "Senior Manager" has been revoked; (ii) the Executive's base recurring salary has been reduced by more than 10%; (iii) the Executive has suffered a negative individual performance adjustment which causes the Executive's short term award under the STIP for a particular year to be reduced by 25% or more; or (iv) the Executive's responsibilities have been substantially reduced in type or scope, other than in a general reorganization of the management functions of one or more Bell Atlantic Companies, with the result that the Executive has materially less status and authority. Nothing in this Section 9(c) shall limit or qualify the obligations of Bell Atlantic under Section 3 of this Agreement, which are absolute. 10. Prohibition Against Competitive Activities: (a) Prohibited Conduct by the Executive: During the period of the Executive's employment with any Bell Atlantic Company, and for a period of two years (or any longer period expressly provided under any applicable provision of this Agreement) following the Executive's retirement or termination of employment for any other reason from any and all Bell Atlantic Companies, the Executive, without the prior written consent of the Chief Executive Officer, shall not: (i) personally engage in "Competitive Activities" (as defined in paragraph 10(b)) within any geographic area in which any Bell Atlantic Company is then engaged (or, at the time of the Executive's termination of employment, Employment Agreement Page 6

had a board-approved business plan under which it planned to engage) in such Competitive Activities; (ii) work for, own, manage, operate, control or participate in the ownership, management, operation or control of, or provide consulting or advisory services to, any individual, partnership, firm, corporation or institution engaged in Competitive Activities within any geographic area described in Section 10(a)(i); provided, however, that the Executive's purchase or holding, for investment purposes, of securities of a publicly-traded company shall not constitute "ownership" or "participation in ownership" for purposes of this paragraph so long as the Executive's equity interest in any such company is less than a controlling interest; (iii) interfere with the relationship of any Bell Atlantic Company with any of its employees, agents, representatives, suppliers or vendors under contract, or joint venturers, where any such person or entity cooperates with or supports a Bell Atlantic Company in its performance of any Competitive Activities; or (iv) directly or indirectly attempt to divert from any Bell Atlantic Company any business in connection with Competitive Activities.

had a board-approved business plan under which it planned to engage) in such Competitive Activities; (ii) work for, own, manage, operate, control or participate in the ownership, management, operation or control of, or provide consulting or advisory services to, any individual, partnership, firm, corporation or institution engaged in Competitive Activities within any geographic area described in Section 10(a)(i); provided, however, that the Executive's purchase or holding, for investment purposes, of securities of a publicly-traded company shall not constitute "ownership" or "participation in ownership" for purposes of this paragraph so long as the Executive's equity interest in any such company is less than a controlling interest; (iii) interfere with the relationship of any Bell Atlantic Company with any of its employees, agents, representatives, suppliers or vendors under contract, or joint venturers, where any such person or entity cooperates with or supports a Bell Atlantic Company in its performance of any Competitive Activities; or (iv) directly or indirectly attempt to divert from any Bell Atlantic Company any business in connection with Competitive Activities. (b) Competitive Activities: For purposes of Section 10(a) hereof, "Competitive Activities" means business activities relating to products or services of the same or similar type as those for which the Executive had responsibility to plan, develop, manage or oversee within the last 24 months of the Executive's employment with any Bell Atlantic Company. (c) Notice. Bell Atlantic shall send the Executive written notice in the event that Bell Atlantic believes that the Executive has violated any of the prohibitions of this Section 10; provided, however, that any failure by Bell Atlantic to give notice under this provision or to enforce its rights under this Agreement in any one or more instances shall not be a bar to Bell Atlantic giving notice and taking action to enforce its rights under this Agreement at any later time. For a period of 15 days after the giving of such notice, the Executive shall have the opportunity to respond and discuss with Bell Atlantic the underlying facts and the basis for Bell Atlantic's belief that the Executive is in breach of this Section 10. During such 15-day period, Bell Atlantic shall not pursue any remedy provided by this Agreement or at law or in equity. (d) Forfeiture of Benefits. The Executive acknowledges that the Executive's violation of any of the prohibitions of this Section 10 or the rules against wrongful competitive activity by the Executive as defined under the RIP and the Bell Atlantic Performance Share Plan ("PSP"), as the terms of those plans may be amended from time to time, may result in the Executive's forfeiture of any and all rights to benefits or awards under the RIP and the PSP. (e) Waiver: Nothing in this Agreement shall bar the Executive from requesting, at the time of the Executive's retirement or at any time thereafter, that the then-current Chief Executive Officer waive Bell Atlantic's rights to enforce the non-compete covenants of this Section 10, and the Chief Executive Officer shall have the Employment Agreement Page 7

power to agree to such a waiver if the Chief Executive Officer determines that it is not inconsistent with the interests of Bell Atlantic to do so. 11. Prohibition Against Disclosure of Proprietary Information: (a) Prohibited Conduct by the Executive: The Executive acknowledges that, as one of the most senior officers of the Bell Atlantic Companies, the Executive has continuing access to confidential and proprietary information of Bell Atlantic Companies. The Executive shall, therefore, at all times during the period of active employment with any Bell Atlantic Company, and for a period of three years thereafter, preserve the confidentiality of all proprietary information of any Bell Atlantic Company. The three-year limitation under this paragraph shall not in any way limit any Bell Atlantic Company's common law and statutory rights to protect its trade secrets or intellectual property rights at any time, to the full extent of the law. "Proprietary information" includes, but is not limited to, information in the possession or control of a Bell Atlantic Company that has not been fully disclosed in a writing which has been generally circulated to the public at large, and which gives the Bell Atlantic Company an opportunity to obtain or maintain advantages over its current and potential competitors, such as strategic or tactical business plans, and undisclosed financial data; ideas, processes, methods, techniques, systems, patented

power to agree to such a waiver if the Chief Executive Officer determines that it is not inconsistent with the interests of Bell Atlantic to do so. 11. Prohibition Against Disclosure of Proprietary Information: (a) Prohibited Conduct by the Executive: The Executive acknowledges that, as one of the most senior officers of the Bell Atlantic Companies, the Executive has continuing access to confidential and proprietary information of Bell Atlantic Companies. The Executive shall, therefore, at all times during the period of active employment with any Bell Atlantic Company, and for a period of three years thereafter, preserve the confidentiality of all proprietary information of any Bell Atlantic Company. The three-year limitation under this paragraph shall not in any way limit any Bell Atlantic Company's common law and statutory rights to protect its trade secrets or intellectual property rights at any time, to the full extent of the law. "Proprietary information" includes, but is not limited to, information in the possession or control of a Bell Atlantic Company that has not been fully disclosed in a writing which has been generally circulated to the public at large, and which gives the Bell Atlantic Company an opportunity to obtain or maintain advantages over its current and potential competitors, such as strategic or tactical business plans, and undisclosed financial data; ideas, processes, methods, techniques, systems, patented or copyrighted information, models, devices, programs, computer software or related information; documents relating to regulatory matters and correspondence with governmental entities; pricing and cost data; reports and analyses of business prospects; business transactions which are contemplated or planned; research data; personnel information and data; identities of users and purchasers of any Bell Atlantic Company's products or services; and other confidential matters pertaining to or known by one or more Bell Atlantic Companies, including confidential information of a third party which a Bell Atlantic Company is bound to protect. (b) Obligation to Return Company Property: If and when the Executive retires or terminates employment for any other reason with all Bell Atlantic Companies, the Executive shall, prior to the last day of active employment and without charge to any Bell Atlantic Company, return to the employing Bell Atlantic Company (or the rightful Bell Atlantic Company) all company property, including, without limitation, originals and copies of records, papers, programs, computer software, documents and other materials which contain Proprietary Information, as defined in Section 11(a). The Executive shall thereafter cooperate with each applicable Bell Atlantic Company in executing and delivering documents requested by the company that are necessary to assist the Bell Atlantic Company in patenting or registering any programs, ideas, inventions, discoveries, copyright material or trademarks, and to vest title thereto in the Bell Atlantic Company. (c) Forfeiture of Benefits. The Executive acknowledges that the Executive's violation of the prohibitions of this Section 11, or other "misconduct" by the Executive (as that term is interpreted by the Human Resources Committee of the Board under the RIP and PSP plans, as those plans may be amended from time to time), may result in the Executive's forfeiture of any and all rights to benefits or awards under the RIP and the PSP. Employment Agreement Page 8 12. Remedies in Addition to Forfeiture of Benefits. The Executive recognizes that irreparable injury will result to one or more Bell Atlantic Companies, and to the business and property of any of them, in the event of a breach by the Executive of any of the provisions of Section 10 or 11 of this Agreement, and that the Executive's continued employment is predicated on the commitments made by the Executive in those Sections. In the event of any breach of any of the Executive's commitments under Section 10 or 11, any Bell Atlantic Company that is damaged by such breach shall be entitled, in addition to declaring a forfeiture of benefits as described herein, and in addition to any other remedies and damages available, to injunctive relief to restrain the violation of such commitments by the Executive or by any person or persons acting for or with the Executive in any capacity whatsoever. 13. Miscellaneous Provisions. (a) Legal Release: Notwithstanding any provision of this Agreement, no liquidated damages or benefits under the terms of this Agreement shall be payable in connection with a separation from service by the Executive unless and until the Executive signs the Release in a form satisfactory to Bell Atlantic; provided, however, that nothing in this Agreement is intended to cause the Executive to waive his right to submit claims for employee benefits in accordance with the terms of any employee benefit plans in which the Executive remains a participant.

12. Remedies in Addition to Forfeiture of Benefits. The Executive recognizes that irreparable injury will result to one or more Bell Atlantic Companies, and to the business and property of any of them, in the event of a breach by the Executive of any of the provisions of Section 10 or 11 of this Agreement, and that the Executive's continued employment is predicated on the commitments made by the Executive in those Sections. In the event of any breach of any of the Executive's commitments under Section 10 or 11, any Bell Atlantic Company that is damaged by such breach shall be entitled, in addition to declaring a forfeiture of benefits as described herein, and in addition to any other remedies and damages available, to injunctive relief to restrain the violation of such commitments by the Executive or by any person or persons acting for or with the Executive in any capacity whatsoever. 13. Miscellaneous Provisions. (a) Legal Release: Notwithstanding any provision of this Agreement, no liquidated damages or benefits under the terms of this Agreement shall be payable in connection with a separation from service by the Executive unless and until the Executive signs the Release in a form satisfactory to Bell Atlantic; provided, however, that nothing in this Agreement is intended to cause the Executive to waive his right to submit claims for employee benefits in accordance with the terms of any employee benefit plans in which the Executive remains a participant. (b) Assignment by Bell Atlantic: Bell Atlantic may assign this Agreement without the Executive's consent to any company that acquires all or substantially all of the assets of Bell Atlantic, or into which or with which Bell Atlantic or the company which is then the Executive's employing company is merged or consolidated. If and when the Executive transfers employment to a Bell Atlantic Company other than Bell Atlantic, that employing company shall automatically be deemed to be a party to this Agreement in addition to Bell Atlantic. This Agreement may not be assigned by the Executive, and no person other than the Executive or his estate may assert the rights of the Executive under this Agreement. The right to receive further compensation or benefits of any kind under this Agreement shall be forfeited upon the death of the Executive, except as expressly provided to the contrary under the terms of any applicable compensation and benefit plan in which the Executive was a participant on the date of his death, and except that, in the event of the death of the Executive during the Committed Employment Period, the cash severance payment provided for by Section 7 of this Agreement shall become payable in full. (c) Waiver: The waiver by any Bell Atlantic Company of a breach by the Executive of any provision of this Agreement shall not be construed as a waiver of any subsequent breach by the Executive. (d) Severability: If any clause, phrase or provision of this Agreement, or the application thereof to any person or circumstance, shall be invalid or unenforceable under any applicable law, such event shall not affect or render invalid or unenforceable the remainder of this Agreement and shall not affect the application of any clause, phrase or provision hereof to other persons or circumstances. Furthermore, in the event that a court of law or equity determines that the geographic scope of the covenants under Section 10, or the duration of any of the restrictions under this Agreement, are not enforceable, this Agreement shall hereby be deemed to be Employment Agreement Page 9

amended to the extent necessary, but only to the extent necessary, to permit the enforcement of the terms of this Agreement. (e) Governing Law: This Agreement shall be construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania. (f) Entire Agreement: This Agreement supersedes the Non-Compete and Proprietary Information Agreement, between Bell Atlantic and the Executive, dated January 24, 1994, and that Agreement is hereby cancelled. Except for the terms and conditions of the compensation and benefit plans applicable to the Executive (as such plans may be amended by the applicable Bell Atlantic Company from time to time), this Agreement sets forth the entire understanding of BAC and the Executive and supersedes all prior agreements, arrangements, and communications, whether oral or written, pertaining to the subject matter hereof; and this Agreement shall not be modified or amended except by written agreement of the Executive, Bell Atlantic and the Bell Atlantic Company which then employs the Executive.

amended to the extent necessary, but only to the extent necessary, to permit the enforcement of the terms of this Agreement. (e) Governing Law: This Agreement shall be construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania. (f) Entire Agreement: This Agreement supersedes the Non-Compete and Proprietary Information Agreement, between Bell Atlantic and the Executive, dated January 24, 1994, and that Agreement is hereby cancelled. Except for the terms and conditions of the compensation and benefit plans applicable to the Executive (as such plans may be amended by the applicable Bell Atlantic Company from time to time), this Agreement sets forth the entire understanding of BAC and the Executive and supersedes all prior agreements, arrangements, and communications, whether oral or written, pertaining to the subject matter hereof; and this Agreement shall not be modified or amended except by written agreement of the Executive, Bell Atlantic and the Bell Atlantic Company which then employs the Executive. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first set forth above. BELL ATLANTIC CORPORATION By:__________________________________ Raymond W. Smith Chairman of the Board and Chief Executive Officer THE EXECUTIVE Lawrence T. Babbio, Jr. Employment Agreement Page 10

EXHIBIT A RELEASE THIS RELEASE (the "Release") is entered into by LAWRENCE T. BABBIO, JR. (the "Executive"), for the benefit of BELL ATLANTIC CORPORATION ("Bell Atlantic"), and all companies, and their officers, directors and employees, which are affiliated with Bell Atlantic (Bell Atlantic and said affiliated companies are sometimes referred to collectively herein as "Bell Atlantic Companies"). WHEREAS, the Executive has retired from his employing Bell Atlantic Company on ____________ (the "Retirement Date") pursuant to the terms of an Employment Agreement, dated _______________, 1995, between Bell Atlantic and the Executive (the "Agreement"), and he wishes to execute this Release as contemplated under the terms of the Agreement. NOW, THEREFORE, the Executive affirms as follows: 1. Except for any as-yet unfulfilled obligations of Bell Atlantic under the terms of the Agreement, or any benefits which the Executive is entitled to receive under the terms of the benefit plans in which he participates (as those plans may be amended from time to time), the Executive, as his free and voluntary act, hereby releases and discharges Bell Atlantic, its affiliates, and their successors and assigns, and the directors, officers, employees, and agents of each of them, of and from any and all debts, obligations, claims, demands, judgments or causes of action of any kind whatsoever, known or unknown, in tort, contract, by statute or on any other basis, for equitable relief, compensatory, punitive or other damages, expenses (including attorneys' fees), reimbursements or costs of any kind, including but not limited to, any and all claims, demands, rights and/or causes of action, including those which might arise out of allegations relating to a claimed breach of an alleged oral or written

EXHIBIT A RELEASE THIS RELEASE (the "Release") is entered into by LAWRENCE T. BABBIO, JR. (the "Executive"), for the benefit of BELL ATLANTIC CORPORATION ("Bell Atlantic"), and all companies, and their officers, directors and employees, which are affiliated with Bell Atlantic (Bell Atlantic and said affiliated companies are sometimes referred to collectively herein as "Bell Atlantic Companies"). WHEREAS, the Executive has retired from his employing Bell Atlantic Company on ____________ (the "Retirement Date") pursuant to the terms of an Employment Agreement, dated _______________, 1995, between Bell Atlantic and the Executive (the "Agreement"), and he wishes to execute this Release as contemplated under the terms of the Agreement. NOW, THEREFORE, the Executive affirms as follows: 1. Except for any as-yet unfulfilled obligations of Bell Atlantic under the terms of the Agreement, or any benefits which the Executive is entitled to receive under the terms of the benefit plans in which he participates (as those plans may be amended from time to time), the Executive, as his free and voluntary act, hereby releases and discharges Bell Atlantic, its affiliates, and their successors and assigns, and the directors, officers, employees, and agents of each of them, of and from any and all debts, obligations, claims, demands, judgments or causes of action of any kind whatsoever, known or unknown, in tort, contract, by statute or on any other basis, for equitable relief, compensatory, punitive or other damages, expenses (including attorneys' fees), reimbursements or costs of any kind, including but not limited to, any and all claims, demands, rights and/or causes of action, including those which might arise out of allegations relating to a claimed breach of an alleged oral or written employment contract, or relating to purported employment discrimination or civil rights violations, such as, but not limited to, those arising under Title VII of the Civil Rights Act of 1964 (42 U.S.C. Section 2000e et seq.), the Civil Rights Acts of 1866 and 1871 (42 U.S.C. Sections 1981 and 1983), Executive Order 11246, as amended, the Age Discrimination in Employment Act of 1967, as amended (29 U.S.C. Section 621 et seq.), the Equal Pay Act of 1963 (29 U.S.C. Section 206(d)(1)), the Rehabilitation Act of 1973 (29 U.S.C. Sections 701-794), the Civil Rights Act of 1991, the Americans with Disabilities Act, or any other applicable federal, state or local employment discrimination statute or ordinance, which the Executive might have or assert against any of said entities or persons (a) by reason of the Executive's active employment by Bell Atlantic or any Bell Atlantic Company, or the termination of said employment and all circumstances related thereto; or (b) by reason of any other matter, cause or thing whatsoever which may have occurred prior to the date of execution of this Release. 2. No Litigation or Other Legal Action. Except for any as-yet unfulfilled obligations of Bell Atlantic under the terms of the Agreement, or any benefits which the Executive is entitled to receive under the terms of the benefit plans in which he participates (as those plans may be amended from time to time), the Executive promises not to initiate a lawsuit or to bring a claim against Bell Atlantic or any Bell Atlantic Company or their successors or assigns, or the directors, officers, employees, or agents of any of them, in any court, government agency, or otherwise, relating to the Executive's employment, the termination of said employment, or Release Page 1

other events, including, but not limited to, any claim under any federal, state or local statute, ordinance, or rule of law. The Executive waives any remedy or recovery in any action which may be brought on the Executive's behalf by any government agency or other person. 3. The Executive hereby reaffirms the terms and conditions of the Agreement in all respects. 4. Should any provision of this Release be declared or be determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said illegal or invalid part, term or provision shall be deemed not to be a part of this Release. STATEMENT BY THE EXECUTIVE WHO IS SIGNING BELOW: BELL ATLANTIC HAS

other events, including, but not limited to, any claim under any federal, state or local statute, ordinance, or rule of law. The Executive waives any remedy or recovery in any action which may be brought on the Executive's behalf by any government agency or other person. 3. The Executive hereby reaffirms the terms and conditions of the Agreement in all respects. 4. Should any provision of this Release be declared or be determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said illegal or invalid part, term or provision shall be deemed not to be a part of this Release. STATEMENT BY THE EXECUTIVE WHO IS SIGNING BELOW: BELL ATLANTIC HAS ADVISED ME IN WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THIS RELEASE. I HAVE CAREFULLY READ AND FULLY UNDERSTAND THE PROVISIONS OF THIS RELEASE AND HAVE HAD SUFFICIENT TIME AND OPPORTUNITY (OVER A PERIOD OF SUBSTANTIALLY MORE THAN 21 DAYS) TO CONSULT WITH MY PERSONAL TAX, FINANCIAL AND LEGAL ADVISORS PRIOR TO EXECUTING THIS DOCUMENT, AND I INTEND TO BE LEGALLY BOUND BY ITS TERMS. I UNDERSTAND THAT I MAY REVOKE THIS RELEASE WITHIN SEVEN (7) DAYS FOLLOWING MY SIGNING, AND THIS RELEASE WILL NOT BECOME ENFORCEABLE OR EFFECTIVE UNTIL THAT SEVEN-DAY PERIOD HAS EXPIRED. THE UNDERSIGNED, intending to be legally bound, has executed this Release as of the _____ day of __________, 19___, that being the Executive's Retirement Date. THE EXECUTIVE Witness:____________________ Signed:__________________________________ THIS IS A RELEASE READ CAREFULLY BEFORE SIGNING

Release Page 2

EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT is made this 2nd day of May, 1995, by and between Bell Atlantic Corporation ("Bell Atlantic") and James G. Cullen (the "Executive"). WHEREAS, Bell Atlantic seeks to retain the services of the Executive and to provide for an efficient transition upon any change in the Chief Executive Officer of Bell Atlantic; WHEREAS, the Executive is willing to remain in the employ of Bell Atlantic upon the following terms and conditions; and WHEREAS, Bell Atlantic and the Executive wish to set forth their agreement as to the terms and conditions upon which the Executive's employment will continue. NOW, THEREFORE, for good and valuable consideration, including the compensation and benefits recited below, the Executive and Bell Atlantic hereby agree as follows: 1. Definitions: (a) Effective Date shall mean the announced effective date of the election of any individual to succeed the person

EMPLOYMENT AGREEMENT THIS EMPLOYMENT AGREEMENT is made this 2nd day of May, 1995, by and between Bell Atlantic Corporation ("Bell Atlantic") and James G. Cullen (the "Executive"). WHEREAS, Bell Atlantic seeks to retain the services of the Executive and to provide for an efficient transition upon any change in the Chief Executive Officer of Bell Atlantic; WHEREAS, the Executive is willing to remain in the employ of Bell Atlantic upon the following terms and conditions; and WHEREAS, Bell Atlantic and the Executive wish to set forth their agreement as to the terms and conditions upon which the Executive's employment will continue. NOW, THEREFORE, for good and valuable consideration, including the compensation and benefits recited below, the Executive and Bell Atlantic hereby agree as follows: 1. Definitions: (a) Effective Date shall mean the announced effective date of the election of any individual to succeed the person who, on the date of this Agreement, is the incumbent Chief Executive Officer of Bell Atlantic. (b) Bell Atlantic Companies shall mean Bell Atlantic and each corporate subsidiary and other affiliated company in which Bell Atlantic directly or indirectly owns a fifty percent or greater interest. (c) Board shall mean the board of directors of Bell Atlantic. (d) Chief Executive Officer shall mean the Chief Executive Officer of Bell Atlantic, as elected and serving from time to time. (e) Committed Employment Period shall mean the period commencing on the date of this Agreement and continuing until the earlier of the second anniversary of the Effective Date or July 1, 1998. (f) Release shall mean a legal release in the form attached to this Agreement as Exhibit A, which shall be signed by the Executive at the time of his retirement from Bell Atlantic as a condition of receiving any and all pension and severance benefits provided under the terms of this Agreement. 2. Termination of this Agreement: In the event that the Executive is elected Chief Executive Officer as of the Effective Date, this Agreement shall then terminate and shall be of no further force or effect. 3. Bell Atlantic Obligations during the Committed Employment Period: During the Committed Employment Period: Employment Agreement Page 1

(a) Bell Atlantic shall continue to employ the Executive as a Bell Atlantic officer with the title of Vice Chairman, with duties of a type and level appropriate to such a title; (b) Bell Atlantic shall compensate the Executive at a Salary Grade not less than 37, and, to the extent not otherwise modified by the terms of this Agreement, the Executive shall be eligible to participate in all of the benefit and compensation plans, and the programs of perquisites, applicable to similarly-situated Senior Managers of Bell Atlantic, as those plans and programs may be amended from time to time; (c) The Board shall nominate the Executive for election as a director at each annual meeting of shareowners of Bell Atlantic which occurs during the Committed Employment Period; and

(a) Bell Atlantic shall continue to employ the Executive as a Bell Atlantic officer with the title of Vice Chairman, with duties of a type and level appropriate to such a title; (b) Bell Atlantic shall compensate the Executive at a Salary Grade not less than 37, and, to the extent not otherwise modified by the terms of this Agreement, the Executive shall be eligible to participate in all of the benefit and compensation plans, and the programs of perquisites, applicable to similarly-situated Senior Managers of Bell Atlantic, as those plans and programs may be amended from time to time; (c) The Board shall nominate the Executive for election as a director at each annual meeting of shareowners of Bell Atlantic which occurs during the Committed Employment Period; and (d) In the event that the Executive does not become Chief Executive Officer on the Effective Date, Bell Atlantic shall, as of the Effective Date, promote the Executive to Salary Grade 38, and shall for the remainder of the Committed Employment Period deliver compensation, benefits and perquisites to the Executive commensurate with that Salary Grade, including, without limitation, annual base salary increases not less than one-third of the amount by which the mid-point of Salary Grade 38 exceeds the Executive's initial salary upon promotion to that Salary Grade. (e) In the event that Lawrence T. Babbio, Jr. is elected Chief Executive Officer as of the Effective Date, the Executive will be elected Vice Chairman and Chief Operating Officer of Bell Atlantic effective as of the Effective Date, and Bell Atlantic shall retain the Executive in that position, with duties commensurate with that title, through the end of the Committed Employment Period. 4. Obligations of the Executive during the Committed Employment Period: During the Committed Employment Period, the Executive shall have the following obligations and duties. (a) The Executive shall continue to fully and faithfully perform his duties and responsibilities (i) as a director, so long as he is elected and serving, and (ii) as an officer, reporting only to the Chief Executive Officer and the Board. (b) The Executive shall serve in such executive capacities, titles and authorities with respect to the Bell Atlantic Companies as the Board or the CEO may from time to time prescribe, and the Executive shall perform all duties incidental to such positions, shall cooperate fully with the Board and the CEO, and shall work cooperatively with the other officers of the Bell Atlantic Companies. (c) The Executive shall continue to diligently devote his entire business skill, time and effort to the affairs of the Bell Atlantic Companies in accordance with the duties assigned to him that are not inconsistent with the terms hereof, and shall perform all such duties, and otherwise conduct himself, in a manner reasonably calculated in good faith by him to promote the best interests of the Bell Atlantic Companies. Prior to the Executive's retirement from Bell Atlantic, except to the extent specifically permitted by the Chief Executive Officer or the Board and except as set forth below, the Officer shall not, directly or indirectly, render any services of a Employment Agreement Page 2

business, commercial or professional nature to any other person or organization other than a Bell Atlantic Company or a venture in which a Bell Atlantic Company has a financial interest, whether or not the services are rendered for compensation. However, the Executive is not prohibited from serving on committees or boards of charitable, educational, civic or other nonprofit organizations, so long as such service does not interfere with his full-time responsibilities to Bell Atlantic. (d) The failure of the Executive to perform his obligations pursuant to paragraphs (a) through (c) above shall be excused when such failure is on account of the Executive's disability within the meaning of the applicable disability benefit plans in which the Executive participates from time to time. 5. Retirement. If the Executive is not elected Chief Executive Officer as of the Effective Date, the Executive hereby agrees, at any time after the last day of the Committed Employment Period, upon request of the then-

business, commercial or professional nature to any other person or organization other than a Bell Atlantic Company or a venture in which a Bell Atlantic Company has a financial interest, whether or not the services are rendered for compensation. However, the Executive is not prohibited from serving on committees or boards of charitable, educational, civic or other nonprofit organizations, so long as such service does not interfere with his full-time responsibilities to Bell Atlantic. (d) The failure of the Executive to perform his obligations pursuant to paragraphs (a) through (c) above shall be excused when such failure is on account of the Executive's disability within the meaning of the applicable disability benefit plans in which the Executive participates from time to time. 5. Retirement. If the Executive is not elected Chief Executive Officer as of the Effective Date, the Executive hereby agrees, at any time after the last day of the Committed Employment Period, upon request of the thencurrent Chief Executive Officer or the Board, to retire from active service with Bell Atlantic, effective as of the date specified in the request. The parties acknowledge that Bell Atlantic shall have the right to cause the Executive to be retired and removed from active service as of any date after the last day of the Committed Employment Period. On the date of such retirement, as a condition of eligibility to receive the pension and severance benefits described in Sections 6 and 7 of this Agreement, the Executive shall sign and deliver the Release and shall not revoke his signature. 6. Retirement Pension Benefits. (a) Eligibility for Waiver of Early Retirement Pension Discount. If a person other than the Executive is elected Chief Executive Officer as of the Effective Date, and if the Executive thereafter completes the Committed Employment Period by remaining in active service with Bell Atlantic in accordance with the terms of this Agreement, the Executive shall at any time thereafter be entitled, subject to signing and delivering the Release, to retire with a two-year waiver of any applicable early retirement pension discount under the terms of the Bell Atlantic Senior Management Retirement Income Plan or any successor to that plan which applies to Senior Managers, as that plan may be amended from time to time ("RIP"), as more fully described in the following paragraph. The parties acknowledge that the pension enhancement described in this Section is part of the consideration given by Bell Atlantic in exchange for the Release and the non-compete and proprietary information covenants granted by the Executive under Sections 10 and 11 of this Agreement. (b) Calculation of Waiver of Early Retirement Pension Discount. If the Executive qualifies for the waiver of early retirement pension discount, as described in the previous paragraph, the Executive's target pension under RIP shall be equal to the greater of: (i) The target pension determined under the applicable pension formula under RIP which is in effect and applicable to the Executive at the time of the Executive's retirement, after adding two additional years to the Executive's age at the time of retirement for purposes of determining the amount of any applicable early retirement discount (but not for any other purpose under RIP); or Employment Agreement Page 3

(ii) The target pension which would have been applicable to the Executive if he had retired at any time during the Committed Employment Period, under the terms of any early retirement incentive, pension window, or other special provision of RIP which may then have been in effect but which is no longer in effect at the time of the Executive's actual retirement. In such a case, the calculation of the RIP enhanced benefit shall not be subject to further supplementation by the discount waiver provisions of the prior paragraph. 7. Further Consideration for Non-Compete Agreement: (a) If a person other than the Executive is elected Chief Executive Officer as of the Effective Date, and if the Executive thereafter completes the Committed Employment Period by remaining in active service with Bell Atlantic in accordance with the terms of this Agreement, then, subject to the Executive signing and delivering the Release, Bell Atlantic shall pay the Executive a cash severance payment, as described in the following paragraph, upon the Executive's retirement at any time thereafter. The parties acknowledge that the severance payment

(ii) The target pension which would have been applicable to the Executive if he had retired at any time during the Committed Employment Period, under the terms of any early retirement incentive, pension window, or other special provision of RIP which may then have been in effect but which is no longer in effect at the time of the Executive's actual retirement. In such a case, the calculation of the RIP enhanced benefit shall not be subject to further supplementation by the discount waiver provisions of the prior paragraph. 7. Further Consideration for Non-Compete Agreement: (a) If a person other than the Executive is elected Chief Executive Officer as of the Effective Date, and if the Executive thereafter completes the Committed Employment Period by remaining in active service with Bell Atlantic in accordance with the terms of this Agreement, then, subject to the Executive signing and delivering the Release, Bell Atlantic shall pay the Executive a cash severance payment, as described in the following paragraph, upon the Executive's retirement at any time thereafter. The parties acknowledge that the severance payment described in this Section is part of the consideration given by Bell Atlantic in exchange for the Release and the non-compete and proprietary information covenants granted by the Executive under Sections 10 and 11 of this Agreement. (b) The severance benefit described in the previous paragraph shall be equal to two times the sum of (i) the annualized amount of the Executive's then-current base salary, plus (ii) the greatest of (A) the value of the Executive's most recent award of cash and deferred stock under the Senior Management Short Term Incentive Plan or any successor to that plan (the "STIP"), or (B) the value of the most recent award of cash and deferred stock under the STIP for the Executive's salary grade without taking into account any individual performance adjustments to the award, or (C) 150% of the target STIP award for the Executive's salary grade as of the date of retirement. This cash separation benefit shall be payable in one installment, not later than 30 days after the termination of employment date, subject to the Executive's continuing compliance with the terms of this Agreement. 8. Retirement or Discharge for Cause during Committed Employment Period. (a) In the event that the Executive voluntarily resigns or retires for any reason (except a "constructive discharge", as defined in Section 9(c)), or is discharged by Bell Atlantic for "cause" (as hereinafter defined), prior to the end of the Committed Employment Period, the Executive shall forfeit any and all rights to receive the special supplementary pension benefits and the severance benefits set forth in Sections 6 and 7 of this Agreement, but shall otherwise be eligible to receive any and all compensation and benefits for which a similarly-situated retiring Senior Manager would be eligible under the applicable provisions of the compensation and benefit plans, as those plans may be amended from time to time. In such event, the Executive shall be subject to the terms of the covenant not to compete, as described in Section 10 of this Agreement, for a period which shall extend from the actual date of retirement through the second anniversary of the end of the Committed Employment Period. (b) For purposes of this Agreement, the term "cause" shall mean a violation of law (other than a traffic violation or other minor civil offense), or behavior that Bell Employment Agreement Page 4

Atlantic concludes amounts to a material breach of any company policy or provision of the Employee Code of Business Conduct, and including, by way of example: dishonesty; working outside the Bell Atlantic Companies in violation of Section 4(c) or 10 of this Agreement in competition with any Bell Atlantic Company; other conduct that poses a material conflict of interest; revealing confidential or proprietary information of any Bell Atlantic Company in violation of Section 11 of this Agreement; or a substantial and deliberate abuse of the voucher or expense reimbursement processes of any Bell Atlantic Company. 9. Certain Involuntary Terminations of Employment: (a) Consequences of Certain Involuntary Terminations. Except in the case of a discharge for cause, in the event that Bell Atlantic involuntarily discharges the Executive, or the Executive is "constructively discharged" (as hereinafter defined), prior to the end of the Committed Employment Period, then the Executive shall be entitled to receive, as liquidated damages, subject to signing and delivering the Release, an amount of cash equal to the

Atlantic concludes amounts to a material breach of any company policy or provision of the Employee Code of Business Conduct, and including, by way of example: dishonesty; working outside the Bell Atlantic Companies in violation of Section 4(c) or 10 of this Agreement in competition with any Bell Atlantic Company; other conduct that poses a material conflict of interest; revealing confidential or proprietary information of any Bell Atlantic Company in violation of Section 11 of this Agreement; or a substantial and deliberate abuse of the voucher or expense reimbursement processes of any Bell Atlantic Company. 9. Certain Involuntary Terminations of Employment: (a) Consequences of Certain Involuntary Terminations. Except in the case of a discharge for cause, in the event that Bell Atlantic involuntarily discharges the Executive, or the Executive is "constructively discharged" (as hereinafter defined), prior to the end of the Committed Employment Period, then the Executive shall be entitled to receive, as liquidated damages, subject to signing and delivering the Release, an amount of cash equal to the compensation and benefits which he would have been entitled to receive had Bell Atlantic fulfilled its obligation to employ the Executive in accordance with the provisions of Section 3 of this Agreement, calculated and paid in accordance with paragraph (b) of this Section. In such a case, in addition to the liquidated damages described in the previous sentence, subject to signing and delivering the Release, the Executive shall be entitled to receive the benefits set forth in Sections 6 and 7 of this Agreement, but calculated as though the Executive had actually remained in active service with Bell Atlantic, earning the compensation described in Section 3 of this Agreement, until the end of the Committed Employment Period, with the payment of the cash separation benefit under Section 7 to be made within 30 days after the termination of employment date. Under the circumstances described in this paragraph, the Executive shall be subject to the non-compete covenants of this Agreement through the period ending on the second anniversary of the date of termination of the Executive's employment. (b) Calculation and Payment of Liquidated Damages. The liquidated damages described in the first sentence of the previous paragraph shall consist of all five of the following items, but only the following items. All of the following items of liquidated damages shall be subject to applicable withholding taxes. Each payment contemplated by this subsection (b) shall be contingent upon the absence, as of the time of such payment, of any knowing and material violation by the Executive of any of the covenants contained in Sections 10 and 11. (i) Salary: The liquidated damages shall be paid monthly in cash, in an amount each month equal to the salary which would have been paid to the Executive under Section 3 of this Agreement, assuming salary adjustments annually at a percentage equal to the merit increase budget percentage for Bell Atlantic Senior Managers. (ii) Short-Term Incentives: The liquidated damages for foregone short- term incentives under STIP shall be paid annually in cash, not later than 30 days after the date on which incentives are awarded by Bell Atlantic under the STIP for the prior year's performance, in an amount equal to the value of the cash and deferred stock which the Executive would have been entitled to receive under the STIP, without adjustment for individual performance. Employment Agreement Page 5

(iii) Long-Term Incentives: The liquidated damages for foregone long- term incentives shall be paid annually in cash, within 30 days of the granting of stock options for the year, in an amount equal to the Black-Scholes value of options which the Executive would have been entitled to receive. (iv) RIP Pension Benefits: The RIP target pension will be recalculated after the completion of the Committed Employment Period taking into account the liquidated damages under paragraphs (i) and (ii) above as though they were earned as salary and short-term incentives during a period of employment ending on the last day of the Committed Employment Period, and (A) Bell Atlantic shall pay the Executive a true-up payment based on said recalculation if the Executive has elected a lump-sum payment of the benefit provided by Section 6(a), and (B) if the Executive has elected a pension in the form of an annuity, the Executive's RIP pension benefits thereafter shall be based on said recalculation. (v) Miscellaneous Benefits: The liquidated damages for all other foregone benefits shall be paid monthly in an amount equal to the sum of: (A) the BellFlex allowance that the Executive would have been entitled to receive, plus (B) one-twelfth of the annual maximum company matching contribution that the Executive would have been

(iii) Long-Term Incentives: The liquidated damages for foregone long- term incentives shall be paid annually in cash, within 30 days of the granting of stock options for the year, in an amount equal to the Black-Scholes value of options which the Executive would have been entitled to receive. (iv) RIP Pension Benefits: The RIP target pension will be recalculated after the completion of the Committed Employment Period taking into account the liquidated damages under paragraphs (i) and (ii) above as though they were earned as salary and short-term incentives during a period of employment ending on the last day of the Committed Employment Period, and (A) Bell Atlantic shall pay the Executive a true-up payment based on said recalculation if the Executive has elected a lump-sum payment of the benefit provided by Section 6(a), and (B) if the Executive has elected a pension in the form of an annuity, the Executive's RIP pension benefits thereafter shall be based on said recalculation. (v) Miscellaneous Benefits: The liquidated damages for all other foregone benefits shall be paid monthly in an amount equal to the sum of: (A) the BellFlex allowance that the Executive would have been entitled to receive, plus (B) one-twelfth of the annual maximum company matching contribution that the Executive would have been eligible to receive if the Executive made the maximum contributions to the Bell Atlantic Savings Plan then permitted by law. (c) Constructive Discharge: The Executive shall be deemed to have been "constructively discharged" for purposes of this Agreement, if, in the absence of conduct amounting to cause for discharge on the part of the Executive, and without the Executive's express written consent, any of the following events has occurred within 12 months prior to the Executive electing to retire: (i) the Executive's status as a "Senior Manager" has been revoked; (ii) the Executive's base recurring salary has been reduced by more than 10%; (iii) the Executive has suffered a negative individual performance adjustment which causes the Executive's short term award under the STIP for a particular year to be reduced by 25% or more; or (iv) the Executive's responsibilities have been substantially reduced in type or scope, other than in a general reorganization of the management functions of one or more Bell Atlantic Companies, with the result that the Executive has materially less status and authority. Nothing in this Section 9(c) shall limit or qualify the obligations of Bell Atlantic under Section 3 of this Agreement, which are absolute. 10. Prohibition Against Competitive Activities: (a) Prohibited Conduct by the Executive: During the period of the Executive's employment with any Bell Atlantic Company, and for a period of two years (or any longer period expressly provided under any applicable provision of this Agreement) following the Executive's retirement or termination of employment for any other reason from any and all Bell Atlantic Companies, the Executive, without the prior written consent of the Chief Executive Officer, shall not: (i) personally engage in "Competitive Activities" (as defined in paragraph 10(b)) within any geographic area in which any Bell Atlantic Company is then engaged (or, at the time of the Executive's termination of employment, Employment Agreement Page 6

had a board-approved business plan under which it planned to engage) in such Competitive Activities; (ii) work for, own, manage, operate, control or participate in the ownership, management, operation or control of, or provide consulting or advisory services to, any individual, partnership, firm, corporation or institution engaged in Competitive Activities within any geographic area described in Section 10(a)(i); provided, however, that the Executive's purchase or holding, for investment purposes, of securities of a publicly-traded company shall not constitute "ownership" or "participation in ownership" for purposes of this paragraph so long as the Executive's equity interest in any such company is less than a controlling interest; (iii) interfere with the relationship of any Bell Atlantic Company with any of its employees, agents, representatives, suppliers or vendors under contract, or joint venturers, where any such person or entity cooperates with or supports a Bell Atlantic Company in its performance of any Competitive Activities; or (iv) directly or indirectly attempt to divert from any Bell Atlantic Company any business in connection with

had a board-approved business plan under which it planned to engage) in such Competitive Activities; (ii) work for, own, manage, operate, control or participate in the ownership, management, operation or control of, or provide consulting or advisory services to, any individual, partnership, firm, corporation or institution engaged in Competitive Activities within any geographic area described in Section 10(a)(i); provided, however, that the Executive's purchase or holding, for investment purposes, of securities of a publicly-traded company shall not constitute "ownership" or "participation in ownership" for purposes of this paragraph so long as the Executive's equity interest in any such company is less than a controlling interest; (iii) interfere with the relationship of any Bell Atlantic Company with any of its employees, agents, representatives, suppliers or vendors under contract, or joint venturers, where any such person or entity cooperates with or supports a Bell Atlantic Company in its performance of any Competitive Activities; or (iv) directly or indirectly attempt to divert from any Bell Atlantic Company any business in connection with Competitive Activities. (b) Competitive Activities: For purposes of Section 10(a) hereof, "Competitive Activities" means business activities relating to products or services of the same or similar type as those for which the Executive had responsibility to plan, develop, manage or oversee within the last 24 months of the Executive's employment with any Bell Atlantic Company. (c) Notice. Bell Atlantic shall send the Executive written notice in the event that Bell Atlantic believes that the Executive has violated any of the prohibitions of this Section 10; provided, however, that any failure by Bell Atlantic to give notice under this provision or to enforce its rights under this Agreement in any one or more instances shall not be a bar to Bell Atlantic giving notice and taking action to enforce its rights under this Agreement at any later time. For a period of 15 days after the giving of such notice, the Executive shall have the opportunity to respond and discuss with Bell Atlantic the underlying facts and the basis for Bell Atlantic's belief that the Executive is in breach of this Section 10. During such 15-day period, Bell Atlantic shall not pursue any remedy provided by this Agreement or at law or in equity. (d) Forfeiture of Benefits. The Executive acknowledges that the Executive's violation of any of the prohibitions of this Section 10 or the rules against wrongful competitive activity by the Executive as defined under the RIP and the Bell Atlantic Performance Share Plan ("PSP"), as the terms of those plans may be amended from time to time, may result in the Executive's forfeiture of any and all rights to benefits or awards under the RIP and the PSP. (e) Waiver: Nothing in this Agreement shall bar the Executive from requesting, at the time of the Executive's retirement or at any time thereafter, that the then-current Chief Executive Officer waive Bell Atlantic's rights to enforce the non-compete covenants of this Section 10, and the Chief Executive Officer shall have the Employment Agreement Page 7

power to agree to such a waiver if the Chief Executive Officer determines that it is not inconsistent with the interests of Bell Atlantic to do so. 11. Prohibition Against Disclosure of Proprietary Information: (a) Prohibited Conduct by the Executive: The Executive acknowledges that, as one of the most senior officers of the Bell Atlantic Companies, the Executive has continuing access to confidential and proprietary information of Bell Atlantic Companies. The Executive shall, therefore, at all times during the period of active employment with any Bell Atlantic Company, and for a period of three years thereafter, preserve the confidentiality of all proprietary information of any Bell Atlantic Company. The three-year limitation under this paragraph shall not in any way limit any Bell Atlantic Company's common law and statutory rights to protect its trade secrets or intellectual property rights at any time, to the full extent of the law. "Proprietary information" includes, but is not limited to, information in the possession or control of a Bell Atlantic Company that has not been fully disclosed in a writing which has been generally circulated to the public at large, and which gives the Bell Atlantic Company an opportunity to obtain or maintain advantages over its current and potential competitors, such as strategic or tactical business plans, and undisclosed financial data; ideas, processes, methods, techniques, systems, patented

power to agree to such a waiver if the Chief Executive Officer determines that it is not inconsistent with the interests of Bell Atlantic to do so. 11. Prohibition Against Disclosure of Proprietary Information: (a) Prohibited Conduct by the Executive: The Executive acknowledges that, as one of the most senior officers of the Bell Atlantic Companies, the Executive has continuing access to confidential and proprietary information of Bell Atlantic Companies. The Executive shall, therefore, at all times during the period of active employment with any Bell Atlantic Company, and for a period of three years thereafter, preserve the confidentiality of all proprietary information of any Bell Atlantic Company. The three-year limitation under this paragraph shall not in any way limit any Bell Atlantic Company's common law and statutory rights to protect its trade secrets or intellectual property rights at any time, to the full extent of the law. "Proprietary information" includes, but is not limited to, information in the possession or control of a Bell Atlantic Company that has not been fully disclosed in a writing which has been generally circulated to the public at large, and which gives the Bell Atlantic Company an opportunity to obtain or maintain advantages over its current and potential competitors, such as strategic or tactical business plans, and undisclosed financial data; ideas, processes, methods, techniques, systems, patented or copyrighted information, models, devices, programs, computer software or related information; documents relating to regulatory matters and correspondence with governmental entities; pricing and cost data; reports and analyses of business prospects; business transactions which are contemplated or planned; research data; personnel information and data; identities of users and purchasers of any Bell Atlantic Company's products or services; and other confidential matters pertaining to or known by one or more Bell Atlantic Companies, including confidential information of a third party which a Bell Atlantic Company is bound to protect. (b) Obligation to Return Company Property: If and when the Executive retires or terminates employment for any other reason with all Bell Atlantic Companies, the Executive shall, prior to the last day of active employment and without charge to any Bell Atlantic Company, return to the employing Bell Atlantic Company (or the rightful Bell Atlantic Company) all company property, including, without limitation, originals and copies of records, papers, programs, computer software, documents and other materials which contain Proprietary Information, as defined in Section 11(a). The Executive shall thereafter cooperate with each applicable Bell Atlantic Company in executing and delivering documents requested by the company that are necessary to assist the Bell Atlantic Company in patenting or registering any programs, ideas, inventions, discoveries, copyright material or trademarks, and to vest title thereto in the Bell Atlantic Company. (c) Forfeiture of Benefits. The Executive acknowledges that the Executive's violation of the prohibitions of this Section 11, or other "misconduct" by the Executive (as that term is interpreted by the Human Resources Committee of the Board under the RIP and PSP plans, as those plans may be amended from time to time), may result in the Executive's forfeiture of any and all rights to benefits or awards under the RIP and the PSP. Employment Agreement Page 8 12. Remedies in Addition to Forfeiture of Benefits. The Executive recognizes that irreparable injury will result to one or more Bell Atlantic Companies, and to the business and property of any of them, in the event of a breach by the Executive of any of the provisions of Section 10 or 11 of this Agreement, and that the Executive's continued employment is predicated on the commitments made by the Executive in those Sections. In the event of any breach of any of the Executive's commitments under Section 10 or 11, any Bell Atlantic Company that is damaged by such breach shall be entitled, in addition to declaring a forfeiture of benefits as described herein, and in addition to any other remedies and damages available, to injunctive relief to restrain the violation of such commitments by the Executive or by any person or persons acting for or with the Executive in any capacity whatsoever. 13. Miscellaneous Provisions. (a) Legal Release: Notwithstanding any provision of this Agreement, no liquidated damages or benefits under the terms of this Agreement shall be payable in connection with a separation from service by the Executive unless and until the Executive signs the Release in a form satisfactory to Bell Atlantic; provided, however, that nothing in this Agreement is intended to cause the Executive to waive his right to submit claims for employee benefits in accordance with the terms of any employee benefit plans in which the Executive remains a participant.

12. Remedies in Addition to Forfeiture of Benefits. The Executive recognizes that irreparable injury will result to one or more Bell Atlantic Companies, and to the business and property of any of them, in the event of a breach by the Executive of any of the provisions of Section 10 or 11 of this Agreement, and that the Executive's continued employment is predicated on the commitments made by the Executive in those Sections. In the event of any breach of any of the Executive's commitments under Section 10 or 11, any Bell Atlantic Company that is damaged by such breach shall be entitled, in addition to declaring a forfeiture of benefits as described herein, and in addition to any other remedies and damages available, to injunctive relief to restrain the violation of such commitments by the Executive or by any person or persons acting for or with the Executive in any capacity whatsoever. 13. Miscellaneous Provisions. (a) Legal Release: Notwithstanding any provision of this Agreement, no liquidated damages or benefits under the terms of this Agreement shall be payable in connection with a separation from service by the Executive unless and until the Executive signs the Release in a form satisfactory to Bell Atlantic; provided, however, that nothing in this Agreement is intended to cause the Executive to waive his right to submit claims for employee benefits in accordance with the terms of any employee benefit plans in which the Executive remains a participant. (b) Assignment by Bell Atlantic: Bell Atlantic may assign this Agreement without the Executive's consent to any company that acquires all or substantially all of the assets of Bell Atlantic, or into which or with which Bell Atlantic or the company which is then the Executive's employing company is merged or consolidated. If and when the Executive transfers employment to a Bell Atlantic Company other than Bell Atlantic, that employing company shall automatically be deemed to be a party to this Agreement in addition to Bell Atlantic. This Agreement may not be assigned by the Executive, and no person other than the Executive or his estate may assert the rights of the Executive under this Agreement. The right to receive further compensation or benefits of any kind under this Agreement shall be forfeited upon the death of the Executive, except as expressly provided to the contrary under the terms of any applicable compensation and benefit plan in which the Executive was a participant on the date of his death, and except that, in the event of the death of the Executive during the Committed Employment Period, the cash severance payment provided for by Section 7 of this Agreement shall become payable in full. (c) Waiver: The waiver by any Bell Atlantic Company of a breach by the Executive of any provision of this Agreement shall not be construed as a waiver of any subsequent breach by the Executive. (d) Severability: If any clause, phrase or provision of this Agreement, or the application thereof to any person or circumstance, shall be invalid or unenforceable under any applicable law, such event shall not affect or render invalid or unenforceable the remainder of this Agreement and shall not affect the application of any clause, phrase or provision hereof to other persons or circumstances. Furthermore, in the event that a court of law or equity determines that the geographic scope of the covenants under Section 10, or the duration of any of the restrictions under this Agreement, are not enforceable, this Agreement shall hereby be deemed to be Employment Agreement Page 9

amended to the extent necessary, but only to the extent necessary, to permit the enforcement of the terms of this Agreement. (e) Governing Law: This Agreement shall be construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania. (f) Entire Agreement: This Agreement supersedes the Non-Compete and Proprietary Information Agreements, between Bell Atlantic and the Executive, dated August 10, 1993 and January 24, 1994, and each of those Agreements is hereby cancelled. Except for the terms and conditions of the compensation and benefit plans applicable to the Executive (as such plans may be amended by the applicable Bell Atlantic Company from time to time), this Agreement sets forth the entire understanding of BAC and the Executive and supersedes all prior agreements, arrangements, and communications, whether oral or written, pertaining to the subject matter hereof; and this Agreement shall not be modified or amended except by written agreement of the Executive, Bell Atlantic and the Bell Atlantic Company which then employs the Executive.

amended to the extent necessary, but only to the extent necessary, to permit the enforcement of the terms of this Agreement. (e) Governing Law: This Agreement shall be construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania. (f) Entire Agreement: This Agreement supersedes the Non-Compete and Proprietary Information Agreements, between Bell Atlantic and the Executive, dated August 10, 1993 and January 24, 1994, and each of those Agreements is hereby cancelled. Except for the terms and conditions of the compensation and benefit plans applicable to the Executive (as such plans may be amended by the applicable Bell Atlantic Company from time to time), this Agreement sets forth the entire understanding of BAC and the Executive and supersedes all prior agreements, arrangements, and communications, whether oral or written, pertaining to the subject matter hereof; and this Agreement shall not be modified or amended except by written agreement of the Executive, Bell Atlantic and the Bell Atlantic Company which then employs the Executive. IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first set forth above. BELL ATLANTIC CORPORATION By: Raymond W. Smith Chairman of the Board and Chief Executive Officer THE EXECUTIVE James G. Cullen Employment Agreement Page 10

EXHIBIT A RELEASE THIS RELEASE (the "Release") is entered into by JAMES G. CULLEN (the "Executive"), for the benefit of BELL ATLANTIC CORPORATION ("Bell Atlantic"), and all companies, and their officers, directors and employees, which are affiliated with Bell Atlantic (Bell Atlantic and said affiliated companies are sometimes referred to collectively herein as "Bell Atlantic Companies"). WHEREAS, the Executive has retired from his employing Bell Atlantic Company on ____________ (the "Retirement Date") pursuant to the terms of an Employment Agreement, dated _______________, 1995, between Bell Atlantic and the Executive (the "Agreement"), and he wishes to execute this Release as contemplated under the terms of the Agreement. NOW, THEREFORE, the Executive affirms as follows: 1. Except for any as-yet unfulfilled obligations of Bell Atlantic under the terms of the Agreement, or any benefits which the Executive is entitled to receive under the terms of the benefit plans in which he participates (as those plans may be amended from time to time), the Executive, as his free and voluntary act, hereby releases and discharges Bell Atlantic, its affiliates, and their successors and assigns, and the directors, officers, employees, and agents of each of them, of and from any and all debts, obligations, claims, demands, judgments or causes of action of any kind whatsoever, known or unknown, in tort, contract, by statute or on any other basis, for equitable relief, compensatory, punitive or other damages, expenses (including attorneys' fees), reimbursements or costs of any kind, including but not limited to, any and all claims, demands, rights and/or causes of action, including those which might arise out of allegations relating to a claimed breach of an alleged oral or written employment contract, or relating to purported employment discrimination or civil rights violations, such as, but not

EXHIBIT A RELEASE THIS RELEASE (the "Release") is entered into by JAMES G. CULLEN (the "Executive"), for the benefit of BELL ATLANTIC CORPORATION ("Bell Atlantic"), and all companies, and their officers, directors and employees, which are affiliated with Bell Atlantic (Bell Atlantic and said affiliated companies are sometimes referred to collectively herein as "Bell Atlantic Companies"). WHEREAS, the Executive has retired from his employing Bell Atlantic Company on ____________ (the "Retirement Date") pursuant to the terms of an Employment Agreement, dated _______________, 1995, between Bell Atlantic and the Executive (the "Agreement"), and he wishes to execute this Release as contemplated under the terms of the Agreement. NOW, THEREFORE, the Executive affirms as follows: 1. Except for any as-yet unfulfilled obligations of Bell Atlantic under the terms of the Agreement, or any benefits which the Executive is entitled to receive under the terms of the benefit plans in which he participates (as those plans may be amended from time to time), the Executive, as his free and voluntary act, hereby releases and discharges Bell Atlantic, its affiliates, and their successors and assigns, and the directors, officers, employees, and agents of each of them, of and from any and all debts, obligations, claims, demands, judgments or causes of action of any kind whatsoever, known or unknown, in tort, contract, by statute or on any other basis, for equitable relief, compensatory, punitive or other damages, expenses (including attorneys' fees), reimbursements or costs of any kind, including but not limited to, any and all claims, demands, rights and/or causes of action, including those which might arise out of allegations relating to a claimed breach of an alleged oral or written employment contract, or relating to purported employment discrimination or civil rights violations, such as, but not limited to, those arising under Title VII of the Civil Rights Act of 1964 (42 U.S.C. Section 2000e et seq.), the Civil Rights Acts of 1866 and 1871 (42 U.S.C. Sections 1981 and 1983), Executive Order 11246, as amended, the Age Discrimination in Employment Act of 1967, as amended (29 U.S.C. Section 621 et seq.), the Equal Pay Act of 1963 (29 U.S.C. Section 206(d)(1)), the Rehabilitation Act of 1973 (29 U.S.C. Sections 701-794), the Civil Rights Act of 1991, the Americans with Disabilities Act, or any other applicable federal, state or local employment discrimination statute or ordinance, which the Executive might have or assert against any of said entities or persons (a) by reason of the Executive's active employment by Bell Atlantic or any Bell Atlantic Company, or the termination of said employment and all circumstances related thereto; or (b) by reason of any other matter, cause or thing whatsoever which may have occurred prior to the date of execution of this Release. 2. No Litigation or Other Legal Action. Except for any as-yet unfulfilled obligations of Bell Atlantic under the terms of the Agreement, or any benefits which the Executive is entitled to receive under the terms of the benefit plans in which he participates (as those plans may be amended from time to time), the Executive promises not to initiate a lawsuit or to bring a claim against Bell Atlantic or any Bell Atlantic Company or their successors or assigns, or the directors, officers, employees, or agents of any of them, in any court, government agency, or otherwise, relating to the Executive's employment, the termination of said employment, or Release Page 1

other events, including, but not limited to, any claim under any federal, state or local statute, ordinance, or rule of law. The Executive waives any remedy or recovery in any action which may be brought on the Executive's behalf by any government agency or other person. 3. The Executive hereby reaffirms the terms and conditions of the Agreement in all respects. 4. Should any provision of this Release be declared or be determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said illegal or invalid part, term or provision shall be deemed not to be a part of this Release. STATEMENT BY THE EXECUTIVE WHO IS SIGNING BELOW: BELL ATLANTIC HAS

other events, including, but not limited to, any claim under any federal, state or local statute, ordinance, or rule of law. The Executive waives any remedy or recovery in any action which may be brought on the Executive's behalf by any government agency or other person. 3. The Executive hereby reaffirms the terms and conditions of the Agreement in all respects. 4. Should any provision of this Release be declared or be determined by any court to be illegal or invalid, the validity of the remaining parts, terms or provisions shall not be affected thereby, and said illegal or invalid part, term or provision shall be deemed not to be a part of this Release. STATEMENT BY THE EXECUTIVE WHO IS SIGNING BELOW: BELL ATLANTIC HAS ADVISED ME IN WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTING THIS RELEASE. I HAVE CAREFULLY READ AND FULLY UNDERSTAND THE PROVISIONS OF THIS RELEASE AND HAVE HAD SUFFICIENT TIME AND OPPORTUNITY (OVER A PERIOD OF SUBSTANTIALLY MORE THAN 21 DAYS) TO CONSULT WITH MY PERSONAL TAX, FINANCIAL AND LEGAL ADVISORS PRIOR TO EXECUTING THIS DOCUMENT, AND I INTEND TO BE LEGALLY BOUND BY ITS TERMS. I UNDERSTAND THAT I MAY REVOKE THIS RELEASE WITHIN SEVEN (7) DAYS FOLLOWING MY SIGNING, AND THIS RELEASE WILL NOT BECOME ENFORCEABLE OR EFFECTIVE UNTIL THAT SEVEN-DAY PERIOD HAS EXPIRED. THE UNDERSIGNED, intending to be legally bound, has executed this Release as of the _____ day of __________, 19___, that being the Executive's Retirement Date. THE EXECUTIVE
Witness: ----------------------Signed: ------------------------------------James G. Cullen

THIS IS A RELEASE READ CAREFULLY BEFORE SIGNING

Release Page 2

EXHIBIT 11 FILE NO. 1-8606 BELL ATLANTIC CORPORATION AND SUBSIDIARIES COMPUTATION OF PER COMMON SHARE EARNINGS (DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
YEARS ENDED DECEMBER 31, ------------------------------------------1995 1994 1993 ------------- ------------- ------------Income before extraordinary items and cumulative effect of changes in accounting principles.............. Extraordinary items......................................... Cumulative effect of changes in accounting principles....... Net income (loss)........................................... $ 1,861.8 (3.5) ------------$ 1,858.3 ============ 1,401.9 (2,156.7) ------------$ (754.8) ============ $ 1,481.6 (58.4) (19.8) -----------$ 1,403.4 ============ $

EXHIBIT 11 FILE NO. 1-8606 BELL ATLANTIC CORPORATION AND SUBSIDIARIES COMPUTATION OF PER COMMON SHARE EARNINGS (DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
YEARS ENDED DECEMBER 31, ------------------------------------------1995 1994 1993 ------------- ------------- ------------Income before extraordinary items and cumulative effect of changes in accounting principles.............. Extraordinary items......................................... Cumulative effect of changes in accounting principles....... Net income (loss)........................................... 1,861.8 (3.5) ------------$ 1,858.3 ============ $ 1,401.9 (2,156.7) ------------$ (754.8) ============ $ 1,481.6 (58.4) (19.8) -----------$ 1,403.4 ============ $

EARNINGS (LOSS) PER COMMON SHARE Weighted average shares outstanding......................... Incremental shares from assumed exercise of stock options and payment of performance share award.................. Total shares................................................ Income before extraordinary items and cumulative effect of changes in accounting principles........................ Extraordinary items......................................... Cumulative effect of changes in accounting principles....... Net income (loss)...........................................

436,760,686 1,584,328 -----------438,345,014 ============ $ 4.25 (.01) ------------$ 4.24 ============

436,283,155 952,652 -----------437,235,807 ============ 3.21 (4.94) ------------$ (1.73) ============ $

435,136,371 1,170,838 -----------436,307,209 ============ 3.39 (.13) (.04) -----------$ 3.22 ============ $

FULLY DILUTED EARNINGS (LOSS) PER COMMON SHARE* Weighted average shares outstanding......................... Incremental shares from assumed exercise of stock options and payment of performance share awards................. Total shares................................................ Income before extraordinary items and cumulative effect of changes in accounting principles........................ Extraordinary items......................................... Cumulative effect of changes in accounting principles....... Net income (loss)...........................................

436,760,686 1,815,245 -----------438,575,931 ============ $ 4.25 (.01) ------------$ 4.24 ============

436,283,155 1,007,218 -----------437,290,373 ============ 3.21 (4.94) ------------$ (1.73) ============ $

435,136,371 1,298,288 -----------436,434,659 ============ 3.39 (.13) (.04) -----------$ 3.22 ============ $

*Fully diluted earnings per share calculation is presented in accordance with Regulation S-K item 601(b)(11) although not required by footnote 2 to paragraph 14 of Accounting Principles Board Opinion No. 15 because it results in dilution of less than 3%.

EXHIBIT 12 FILE NO. 1-8606 BELL ATLANTIC CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (DOLLARS IN MILLIONS)

EXHIBIT 12 FILE NO. 1-8606 BELL ATLANTIC CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (DOLLARS IN MILLIONS)
YEARS ENDED DECEMBER 31, ----------------------------------------1995 1994 1993 1992 ---------------------------Income before provision for income taxes, extraordinary items, and cumulative effect of changes in accounting principles......................................... Equity in income of less than majority-owned subsidiaries...... Dividends from less than majority-owned subsidiaries........... Interest expense, including interest on capital lease obligations................................................. Portion of rent expense representative of the interest factor.. Income, as adjusted............................................

$3,009.4 (152.5) 146.0 571.1 90.9 -------$3,664.9 ========

$2,286.8 (41.1) 101.0 624.6 95.2 -------$3,066.5 ========

$2,273.6 (48.3) 73.4 719.6 102.6 -------$3,120.9 ========

$2,025. (52. 48. 828. 98. ------$2,948. =======

Fixed charges: Interest expense, including interest on capital lease obligations.................................................. Portion of rent expense representative of the interest factor.. Capitalized interest........................................... Preferred stock dividend requirement........................... Fixed charges..................................................

571.1 90.9 64.4 9.9 -------$ 736.3 ======== 4.98 ========

$

624.6 95.2 19.1 5.7 -------$ 744.6 ======== 4.12 ========

$

719.6 102.6 1.1 --------$ 823.3 ======== 3.79 ========

$

828. 98. 3. ------$ 930. ======= 3.1 =======

$

Ratio of Earnings to Fixed Charges.............................

EXHIBIT 13 Selected Financial and Operating Data
(Dollars in Millions, Except --------------------------------------------------------1995/(a)/ 1994/(b)/ 1993/(c)/ 1992 --------------------------------------------------------FOR THE YEAR Operating Revenues Operating Income Income Before Extraordinary Items and Cumulative Effect of Changes in Accounting Principles Net Income (Loss) PER COMMON SHARE Income Before Extraordinary Items and Cumulative Effect of Changes in Accounting Principles Net Income (Loss) Cash Dividends Declared AT YEAR END Total Assets Long-Term Debt Employee Benefit Obligations Preferred Stock of Subsidiary Shareowners' Investment Debt Ratio Book Value Per Common Share $13,429.5 $ 3,086.2 $13,791.4 $ 2,804.6 $13,145.6 $ 2,797.6 $12,836 $ 2,506

$ 1,861.8 $ 1,858.3

$ 1,401.9 $ (754.8)

$ 1,481.6 $ 1,403.4

$ 1,382 $ 1,340

$ $ $

4.25 4.24 2.80

$ $ $

3.21 (1.73) 2.76

$ $ $

3.39 3.22 2.68

$ $ $

3. 3. 2.

$24,156.8 $ 6,407.2 $ 3,841.3 $ 145.0 $ 6,683.6 55.5% $ 15.27

$24,271.8 $ 6,805.7 $ 3,773.8 $ 85.0 $ 6,081.3 59.4% $ 13.94

$29,544.2 $ 7,206.2 $ 3,396.0 $ 8,224.4 54.6% $ 18.85

$28,099 $ 7,348 $ 3,058 $ 7,816 56 $ 18.

EXHIBIT 13 Selected Financial and Operating Data
(Dollars in Millions, Except --------------------------------------------------------1995/(a)/ 1994/(b)/ 1993/(c)/ 1992 --------------------------------------------------------FOR THE YEAR Operating Revenues Operating Income Income Before Extraordinary Items and Cumulative Effect of Changes in Accounting Principles Net Income (Loss) PER COMMON SHARE Income Before Extraordinary Items and Cumulative Effect of Changes in Accounting Principles Net Income (Loss) Cash Dividends Declared AT YEAR END Total Assets Long-Term Debt Employee Benefit Obligations Preferred Stock of Subsidiary Shareowners' Investment Debt Ratio Book Value Per Common Share Network Access Lines (in thousands) Number of Employees OTHER DATA Return on Average Common Equity Additions to Plant, Property and Equipment $13,429.5 $ 3,086.2 $13,791.4 $ 2,804.6 $13,145.6 $ 2,797.6 $12,836 $ 2,506

$ 1,861.8 $ 1,858.3

$ 1,401.9 $ (754.8)

$ 1,481.6 $ 1,403.4

$ 1,382 $ 1,340

$ $ $

4.25 4.24 2.80

$ $ $

3.21 (1.73) 2.76

$ $ $

3.39 3.22 2.68

$ $ $

3. 3. 2.

$24,156.8 $ 6,407.2 $ 3,841.3 $ 145.0 $ 6,683.6 55.5% $ 15.27 19,820 61,800

$24,271.8 $ 6,805.7 $ 3,773.8 $ 85.0 $ 6,081.3 59.4% $ 13.94 19,168 72,300

$29,544.2 $ 7,206.2 $ 3,396.0 $ 8,224.4 54.6% $ 18.85 18,645 73,600

$28,099 $ 7,348 $ 3,058 $ 7,816 56 $ 18. 18,1 71,4

28.6% $ 2,641.8

(9.8)% $ 2,699.0

17.3% $ 2,519.0

17 $ 2,546

/(a)/ On July 1, 1995, the company contributed its domestic cellular and paging businesses to a partnership, and accounts for its share of the partnership's results under the equity method. /(b)/ 1994 includes an extraordinary charge for the discontinuation of regulatory accounting principles at the telephone subsidiaries. /(c)/ 1993 includes the adoption of changes in accounting for income taxes and postemployment benefits. /(d)/ 1991 includes the adoption of a change in accounting for postretirement benefits other than pensions. 4

Management's Discussion and Analysis of Results of Operations and Financial Condition OVERVIEW Bell Atlantic Corporation (Bell Atlantic or the Company) is a diversified telecommunications company. Bell Atlantic's network operations subsidiaries provide voice and data transport and calling services, network access, directory publishing and public telephone services to customers in the mid-Atlantic region. Other network-related subsidiaries principally provide systems integration services, customer premises equipment distribution and video services. The Company's network operations subsidiaries comprise seven operating telephone companies and a subsidiary that performs centralized services on their behalf. The operating telephone companies are public utilities subject to regulation by each of the state jurisdictions in which they operate and by the Federal Communications Commission.

Management's Discussion and Analysis of Results of Operations and Financial Condition OVERVIEW Bell Atlantic Corporation (Bell Atlantic or the Company) is a diversified telecommunications company. Bell Atlantic's network operations subsidiaries provide voice and data transport and calling services, network access, directory publishing and public telephone services to customers in the mid-Atlantic region. Other network-related subsidiaries principally provide systems integration services, customer premises equipment distribution and video services. The Company's network operations subsidiaries comprise seven operating telephone companies and a subsidiary that performs centralized services on their behalf. The operating telephone companies are public utilities subject to regulation by each of the state jurisdictions in which they operate and by the Federal Communications Commission. Through several joint ventures, the Company provides wireless communications services in the United States and has invested in wireless businesses in Mexico, Italy, Slovakia, and the Czech Republic. The Company also has an investment in Telecom Corporation of New Zealand Limited, which provides a full range of telecommunications services. Effective July 1, 1995, Bell Atlantic and NYNEX Corporation (NYNEX) combined substantially all of their domestic cellular and paging businesses and formed Bell Atlantic NYNEX Mobile, a partnership which owns such businesses in the Northeast, mid-Atlantic, Southeast and Southwest portions of the United States (see Note 2 to the Consolidated Financial Statements). In 1994, Bell Atlantic and NYNEX formed two partnerships with U S WEST, Inc. and AirTouch Communications to provide nationwide personal communications services (PCS). The first partnership (PCS PrimeCo) acquired licenses for approximately $1.1 billion which will allow PCS PrimeCo to provide PCS services in 11 major markets across the United States. The second partnership was formed to develop a national branding and marketing strategy and wireless communications service standards. Bell Atlantic also formed two partnerships with NYNEX and Pacific Telesis Group to provide multimedia services. TELE-TV Media, L.P. will license, acquire and develop entertainment and information services. TELE-TV Systems, L.P. will provide the systems necessary to deliver these services over the partners' networks. RESULTS OF OPERATIONS Bell Atlantic reported income before extraordinary items and cumulative effect of changes in accounting principles of $1,861.8 million, $1,401.9 million and $1,481.6 million in 1995, 1994 and 1993, respectively. Earnings per share before extraordinary items and cumulative effect of changes in accounting principles for those years were $4.25, $3.21 and $3.39, respectively. Results for 1995 included a pretax gain of approximately $314 million ($200 million after-tax) as a result of the sale of certain cellular properties in Massachusetts and Rhode Island in connection with the formation of the Bell Atlantic NYNEX Mobile partnership. In 1994, the Company recorded a pretax charge of $161.9 million ($99.5 million after-tax), in accordance with Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits" (Statement No. 112), to recognize benefit costs for the separation of employees who are entitled to benefits under preexisting separation pay plans. Results for 1994 also included a non-cash, after-tax extraordinary charge of $2,150.0 million in connection with the Company's decision to discontinue application of regulatory accounting principles required by Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation" (see Note 4 to the Consolidated Financial Statements). In 1993, the Company recorded a net after-tax charge of $19.8 million for the cumulative effect of adopting new financial accounting standards related to income taxes and postemployment benefits. Results for the three years included extraordinary charges for the early extinguishment of debt, net of tax, of $3.5 million, $6.7 million and $58.4 million for 1995, 1994 and 1993, respectively.

FORMATION OF THE BELL ATLANTIC NYNEX MOBILE PARTNERSHIP As a result of the formation of the Bell Atlantic NYNEX Mobile partnership, the Company discontinued consolidation of the domestic cellular and paging operations contributed to the partnership. The Company's investment in the partnership is accounted for under the equity method. Under this method, the Company's proportionate share of the partnership's pretax income is included in Equity in Income of Affiliates. The Consolidated Statements of Operations continue to reflect the results of Bell Atlantic's domestic cellular and paging businesses on a consolidated basis for all periods prior to July 1, 1995. Revenues and expenses of the Company's domestic cellular and paging businesses reflected in the financial statements for periods prior to the formation of the partnership are provided in Note 2 to the Consolidated Financial Statements. To facilitate the comparison of financial results for purposes of the Management's Discussion and Analysis, the net revenues and expenses of the Company's domestic cellular and paging operations prior to July 1, 1995 are classified in the Statements of Operations below as a component of Equity in Income of Affiliates. 11

Management's Discussion and Analysis continued CONSOLIDATED STATEMENTS OF OPERATIONS with Domestic Cellular and Paging Results of Operations prior to July 1, 1995 presented as though accounted for under the equity method
(Dollars ------------------------------------For the Years Ended December 31, 1995 1994 - ------------------------------------------------------------------------------------------------------OPERATING REVENUES Transport Services Local service Network access Toll service Ancillary Services Directory publishing Other Value-added Services Other Services

$

4,423.6 3,394.7 1,435.1

$

4,333.2 3,237.6 1,555.5

1,107.7 557.4 1,393.2 515.9 ----------12,827.6 -----------

1,084.2 481.0 1,284.4 800.6 ----------12,776.5 -----------

OPERATING EXPENSES Employee costs, including benefits and taxes Depreciation and amortization Other 3,932.8 2,548.5 3,358.0 ----------9,839.3 ----------2,988.3 236.4 331.8 547.1 ----------4,174.7 2,516.1 3,396.8 ----------10,087.6 ----------2,688.9 128.9 36.3 567.3 -----------

OPERATING INCOME Equity in Income of Affiliates Other Income and Expense, Net Interest Expense Income Before Provision for Income Taxes, Extraordinary Items, and Cumulative Effect of Changes in Accounting Principles Provision for Income Taxes

3,009.4 1,147.6 -----------

2,286.8 884.9 -----------

INCOME BEFORE EXTRAORDINARY ITEMS AND CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES

1,861.8

1,401.9

Management's Discussion and Analysis continued CONSOLIDATED STATEMENTS OF OPERATIONS with Domestic Cellular and Paging Results of Operations prior to July 1, 1995 presented as though accounted for under the equity method
(Dollars ------------------------------------For the Years Ended December 31, 1995 1994 - ------------------------------------------------------------------------------------------------------OPERATING REVENUES Transport Services Local service Network access Toll service Ancillary Services Directory publishing Other Value-added Services Other Services

$

4,423.6 3,394.7 1,435.1

$

4,333.2 3,237.6 1,555.5

1,107.7 557.4 1,393.2 515.9 ----------12,827.6 -----------

1,084.2 481.0 1,284.4 800.6 ----------12,776.5 -----------

OPERATING EXPENSES Employee costs, including benefits and taxes Depreciation and amortization Other 3,932.8 2,548.5 3,358.0 ----------9,839.3 ----------2,988.3 236.4 331.8 547.1 ----------4,174.7 2,516.1 3,396.8 ----------10,087.6 ----------2,688.9 128.9 36.3 567.3 -----------

OPERATING INCOME Equity in Income of Affiliates Other Income and Expense, Net Interest Expense Income Before Provision for Income Taxes, Extraordinary Items, and Cumulative Effect of Changes in Accounting Principles Provision for Income Taxes

3,009.4 1,147.6 -----------

2,286.8 884.9 -----------

INCOME BEFORE EXTRAORDINARY ITEMS AND CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES Extraordinary Items Discontinuation of regulatory accounting principles, net of tax Early extinguishment of debt, net of tax

1,861.8 ----------(3.5) ----------(3.5) ------------------------------$ 1,858.3 ===========

1,401.9 ----------(2,150.0) (6.7) ----------(2,156.7) ------------------------------$ (754.8) ===========

Cumulative Effect of Changes in Accounting Principles Income taxes Postemployment benefits, net of tax

NET INCOME (LOSS)

For the years ended December 31, 1995, 1994 and 1993, previously eliminated intercompany transactions aggregating $28.0 million, $48.4 million and $37.4 million, respectively, are added back to both operating revenues and operating expenses. Items affecting the comparison of the above operating results between 1995 and 1994, and between 1994 and

1993, are discussed in the following sections. 12

Management's Discussion and Analysis continued A bar chart is presented, depicting the following data:
Access Line in Service (in thousands) -------------At December 31, 1993 18,645 At December 31, 1994 19,168 At December 31, 1995 19,820 - --------------------------------------------------------------------------------

OPERATING REVENUES LOCAL SERVICE REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 90.4 2.1% - -------------------------------------------------------------------------------1994 - 1993 $ 128.6 3.1% - --------------------------------------------------------------------------------

Local service revenues are earned by the operating telephone subsidiaries from the provision of local exchange, local private line and public telephone services. Local service revenues increased in 1995 and 1994 due primarily to growth in network access lines in service of 3.4% and 2.8%, respectively. Business and residence access lines increased 5.5% and 2.4%, respectively, compared to growth rates of 4.3% and 2.1% in 1994. Stronger access line growth in 1995 reflects higher demand for Centrex services and an increase in the number of second residential lines in service. A bar chart is presented, depicting the following data:
Access Minutes of Use (in thousands) -------------Year ended December 31, 1993 65,080 Year ended December 31, 1994 70,864 Year ended December 31, 1995 76,464 - --------------------------------------------------------------------------------

NETWORK ACCESS REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 157.1 4.9% - -------------------------------------------------------------------------------1994 - 1993 $ 166.7 5.4% - --------------------------------------------------------------------------------

Network access revenues are received from interexchange carriers (IXCs) for their use of the Company's local exchange facilities in providing long distance services to IXCs' customers and from end-user subscribers.

Management's Discussion and Analysis continued A bar chart is presented, depicting the following data:
Access Line in Service (in thousands) -------------At December 31, 1993 18,645 At December 31, 1994 19,168 At December 31, 1995 19,820 - --------------------------------------------------------------------------------

OPERATING REVENUES LOCAL SERVICE REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 90.4 2.1% - -------------------------------------------------------------------------------1994 - 1993 $ 128.6 3.1% - --------------------------------------------------------------------------------

Local service revenues are earned by the operating telephone subsidiaries from the provision of local exchange, local private line and public telephone services. Local service revenues increased in 1995 and 1994 due primarily to growth in network access lines in service of 3.4% and 2.8%, respectively. Business and residence access lines increased 5.5% and 2.4%, respectively, compared to growth rates of 4.3% and 2.1% in 1994. Stronger access line growth in 1995 reflects higher demand for Centrex services and an increase in the number of second residential lines in service. A bar chart is presented, depicting the following data:
Access Minutes of Use (in thousands) -------------Year ended December 31, 1993 65,080 Year ended December 31, 1994 70,864 Year ended December 31, 1995 76,464 - --------------------------------------------------------------------------------

NETWORK ACCESS REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 157.1 4.9% - -------------------------------------------------------------------------------1994 - 1993 $ 166.7 5.4% - --------------------------------------------------------------------------------

Network access revenues are received from interexchange carriers (IXCs) for their use of the Company's local exchange facilities in providing long distance services to IXCs' customers and from end-user subscribers. Switched access service revenues are derived from usage-based charges paid by IXCs for access to the Company's network. Special access revenues arise from access charges paid by IXCs and end-users who have private networks. End-user access revenues are earned from local exchange carrier customers who pay for access to the network.

Network access revenues increased in 1995 and 1994 principally due to higher customer demand for access services as reflected by growth in access minutes of use. Access minutes of use for the years 1995 and 1994 grew by 7.9% and 8.9%, respectively. Higher end-user revenues attributable to increases in access lines in service also contributed to revenue growth in both years. Revenues in 1995 were positively impacted by a temporary rate increase that was in effect from March 17, 1995 through July 31, 1995 to recover prior years "exogenous" postemployment benefit costs. Revenue growth from volume increases for both years was partially offset by the effect of price reductions under the Federal Communications Commission's (FCC) Price Cap Plans. In March 1995, the FCC adopted an order approving an Interim Price Cap Plan for interstate access charges, which replaced the prior Price Cap Plan. As required by the FCC's order, the Company filed its Transmittal of Interstate Rates, which resulted in price decreases totaling approximately $305 million on an annual basis, effective August 1, 1995. These price decreases included the scheduled expiration of a temporary rate increase of approximately $98 million on an annualized basis that was in effect from March 17, 1995 through July 31, 1995 to recover prior years "exogenous" postemployment benefit costs. Also as part of the filing, the Company selected a 5.3% Productivity Factor, which eliminates the requirement to share a portion of interstate overearnings related to the August 1995 to June 1996 tariff period. While the Company expects current volume growth trends to continue, the impact of the August 1, 1995 price decreases is expected to substantially offset volume-related growth during the first half of 1996, relative to 1995 network access revenues. TOLL SERVICE REVENUES
Dollars in Millions (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (120.4) (7.7)% - -------------------------------------------------------------------------------1994 - 1993 $ (2.5) (.2)% - --------------------------------------------------------------------------------

Toll service revenues are earned from calls made outside a customer's local calling area, but within the same service area boundaries of the Company's telephone subsidiaries, commonly referred to as Local Access and Transport Areas (LATAs). Other toll services include 800 services, Wide Area Telephone Service (WATS), and corridor services (between Northern New Jersey and New York City and between Southern New Jersey and Philadelphia.) The reduction in toll service revenues in 1995 was caused by a decline in toll message volumes of 2.4% and company-initiated price reductions. The decrease in toll messages was due primarily to increased competition throughout the region for intraLATA toll, WATS and private line services. Price reductions were implemented on certain toll services as part of the Company's competitive response. Local calling areas were also extended in Virginia. 13

Management's Discussion and Analysis continued Toll service revenues grew in the first half of 1994 by $37.0 million, but declined by $39.5 million during the second half of 1994 over the comparable periods in 1993. Growth in the first half of the year was primarily the result of the recovering economy and severe winter conditions, which caused an increase in toll calling volumes. The decline in the second half of 1994 reflected the impact of competition for intraLATA toll, WATS and private line services, price reductions and extended local calling areas. Toll message volumes increased 1.8% in 1994, compared to the prior year. The Company expects that competition for toll service revenues will continue in 1996, however, the revenue

Management's Discussion and Analysis continued Toll service revenues grew in the first half of 1994 by $37.0 million, but declined by $39.5 million during the second half of 1994 over the comparable periods in 1993. Growth in the first half of the year was primarily the result of the recovering economy and severe winter conditions, which caused an increase in toll calling volumes. The decline in the second half of 1994 reflected the impact of competition for intraLATA toll, WATS and private line services, price reductions and extended local calling areas. Toll message volumes increased 1.8% in 1994, compared to the prior year. The Company expects that competition for toll service revenues will continue in 1996, however, the revenue decline is expected to be less than in 1995. See "Factors That May Impact Future Results" below for a further discussion of toll service revenue issues. DIRECTORY PUBLISHING REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 23.5 2.2% - -------------------------------------------------------------------------------1994 - 1993 $ 30.8 2.9% - --------------------------------------------------------------------------------

Directory publishing revenues are earned primarily from local advertising and marketing services provided to businesses in White and Yellow Pages directories published throughout the region. Other directory publishing services include database and foreign directory marketing. Growth in directory publishing revenues in 1995 and 1994 was principally due to higher rates charged for these services. Volume growth continues to be impacted by competition from other directory companies, as well as other advertising media. OTHER ANCILLARY SERVICES REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 76.4 15.9% - -------------------------------------------------------------------------------1994 - 1993 $ 96.0 24.9% - --------------------------------------------------------------------------------

Other ancillary services include systems integration services provided to business customers and the federal government, billing and collection services provided to IXCs, facilities rental, customer premises distribution and video services. Other ancillary services revenues increased in both years principally due to an increase in the number of contracts for systems integration services. The growth in revenues in 1995 was negatively impacted by the timing of certain contracts with the federal government and a reduction in billing and collection services as a result of the elimination of certain services from a contract with an IXC. VALUE-ADDED SERVICES REVENUES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 108.8 8.5%

- -------------------------------------------------------------------------------1994 - 1993 $ 90.8 7.6% - --------------------------------------------------------------------------------

Value-added services represent a family of services which expand the utilization of the network. These services include recent products such as voice messaging services, Caller ID and Return Call as well as more mature products such as Centrex, Touch-Tone, and customer premises wiring and maintenance services. Continued growth in the network customer base (access lines) and higher demand by customers for certain value-added central office and voice messaging services offered by the telephone subsidiaries increased valueadded services revenues in 1995 and 1994. Revenue increases in 1995 were partially offset by the elimination of Touch-Tone service charges for Bell Atlantic - Virginia customers, effective January 1, 1995. OTHER SERVICES REVENUES
Dollars in Millions (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (284.7) (35.6)% - -------------------------------------------------------------------------------1994 - 1993 $ (128.5) (13.8)% - --------------------------------------------------------------------------------

Other services include the Company's computer maintenance, real estate and leasing businesses. During 1995 and 1994, the Company sold several non-strategic businesses, including substantially all of its lease financing businesses and a liquefied petroleum gas distribution business in 1994 and its domestic computer maintenance business in October 1995 (see Note 6 to the Consolidated Financial Statements). The decline in other services revenues in 1995 and 1994 was caused principally by the effect of the disposition of these businesses. Due to the disposition of the Company's domestic computer maintenance business, Bell Atlantic Business Systems Services, Inc., future periods will no longer include operating revenues from this business. Total operating revenues related to this business were approximately $402 million, $472 million and $386 million for the years ended December 31, 1995, 1994 and 1993, respectively. 14

Management's Discussion and Analysis continued A bar chart is presented, depicting the following data:
Number of Employees ------------------73,600

At December 31, 1993

Management's Discussion and Analysis continued A bar chart is presented, depicting the following data:
Number of Employees ------------------At December 31, 1993 73,600 At December 31, 1994 72,300 At December 31, 1995 61,800* - --------------------------------------------------------------------------------

* No longer includes employees of the Company's domestic cellular and paging businesses and domestic computer maintenance business. At December 31, 1994, employees of these businesses were 3,400 and 4,100, respectively. OPERATING EXPENSES EMPLOYEE COSTS
Dollars in Millions Increase (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (241.9) (5.8)% - -------------------------------------------------------------------------------1994 - 1993 $ 268.5 6.9% - --------------------------------------------------------------------------------

Employee costs consist of salaries, wages, and other employee compensation, employee benefits, and payroll taxes. Employee costs at the network operations subsidiaries decreased in 1995 by $201.5 million or 5.4% and increased by $218.7 million or 6.2% in 1994, compared with the corresponding prior years. The decrease in 1995 employee costs at the network operations subsidiaries was principally due to the effect of a third quarter 1994 charge of $161.9 million to recognize benefit costs, in accordance with Statement No. 112, for the separation of employees who are entitled to benefits under preexisting separation pay plans. Decreased overtime pay, lower workforce levels and a reduction in pension cost further reduced employee costs in 1995. These cost reductions were partially offset by annual salary and wage increases and the recognition of certain contract labor and separation pay costs in 1995 associated with a new five-year labor contract with the International Brotherhood of Electrical Workers (IBEW) and the contract settlement with the Communications Workers of America (CWA). In June 1995, the telephone companies executed a five-year contract with the IBEW, representing approximately 9,000 employees. The IBEW contract, which became effective May 21, 1995, provided for a 14.5% wage increase over the five- year contract period, a ratification bonus, improved pensions and benefits, and certain employment security provisions. The Bell Atlantic telephone companies' contract with the CWA, representing approximately 34,000 employees, expired on August 5, 1995. In January 1996, a tentative three-year labor agreement was reached, which was subsequently ratified in February 1996. The agreement includes a 10.6% wage increase over the three-year contract period, a ratification bonus, improved pensions and benefits, and certain employment security provisions. In 1994, employee costs were higher at the network operations subsidiaries principally as a result of the $161.9 million charge for separation pay costs, salary and wage increases, and increased overtime pay. Lower workforce levels partially offset these cost increases. Employee costs at the Company's nonregulated subsidiaries decreased by $40.4 million or 9.4% in 1995 and increased by $49.8 million or 13.1% in 1994. Employee costs were lower in 1995, as compared to the prior

year, principally due to a reduction in workforce levels resulting from the sale of the Company's domestic computer maintenance subsidiary in late 1995 and the disposition of the Company's lease financing subsidiaries and certain other non-strategic businesses during 1994. In 1994, employee costs at the nonregulated subsidiaries were higher as a result of workforce increases at the Company's computer maintenance, video services and systems integration subsidiaries. This increase was offset, in part, by a reduction in workforce levels resulting from the aforementioned disposition of certain non-strategic businesses during 1994. DEPRECIATION AND AMORTIZATION
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 32.4 1.3% - -------------------------------------------------------------------------------1994 - 1993 $ 78.5 3.2% - --------------------------------------------------------------------------------

Depreciation and amortization expense at the network operations subsidiaries in 1995 and 1994 increased $87.7 million or 3.7% and $139.1 million or 6.2%, respectively, compared with the corresponding prior years, principally due to growth in depreciable telephone plant. Increased depreciation in 1994 also reflected the impact of higher rates of depreciation resulting principally from the discontinued application of regulatory accounting principles in August 1994 (see Note 4 to the Consolidated Financial Statements). The composite depreciation rates for the network operations subsidiaries were 7.9% in 1995, 7.8% in 1994 and 7.5% in 1993. Depreciation and amortization expense at the nonregulated subsidiaries decreased by $55.3 million or 43.4% in 1995 and $60.6 million or 32.2% in 1994 over the corresponding prior years. The decreases were primarily due to the effect of the disposition of the Company's domestic computer maintenance business in October 1995 and the sale of substantially all of the assets of the Company's lease financing businesses during 1994. 15

Management's Discussion and Analysis continued OTHER OPERATING EXPENSES
Dollars in Millions Increase (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (38.8) (1.1)% - -------------------------------------------------------------------------------1994 - 1993 $ 97.1 2.9% - --------------------------------------------------------------------------------

Other operating expenses consist primarily of contract services, rent, network software costs, provision for uncollectible accounts receivable and other costs. The reduction in other operating expenses in 1995 was largely due to the effect of the aforementioned disposition of several non-strategic businesses during 1995 and 1994. These cost reductions were partially offset by additional costs incurred at the network operations subsidiaries to enhance systems, consolidate work activities and market value-added services. In 1994, other operating expenses were higher, as compared to 1993, principally due to higher volumes of business at the Company's network operations, computer maintenance, and systems integration subsidiaries. The Company also incurred higher expenses in 1994, relative to 1993, for video services development. These cost increases were partially offset by the effect of the disposition of several non-strategic businesses, and reimbursements received from other Bell Communications Research, Inc. (Bellcore) owners who decided to participate in Bellcore's Advanced Intelligent Network project. This project previously was supported entirely by the Company.

Management's Discussion and Analysis continued OTHER OPERATING EXPENSES
Dollars in Millions Increase (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (38.8) (1.1)% - -------------------------------------------------------------------------------1994 - 1993 $ 97.1 2.9% - --------------------------------------------------------------------------------

Other operating expenses consist primarily of contract services, rent, network software costs, provision for uncollectible accounts receivable and other costs. The reduction in other operating expenses in 1995 was largely due to the effect of the aforementioned disposition of several non-strategic businesses during 1995 and 1994. These cost reductions were partially offset by additional costs incurred at the network operations subsidiaries to enhance systems, consolidate work activities and market value-added services. In 1994, other operating expenses were higher, as compared to 1993, principally due to higher volumes of business at the Company's network operations, computer maintenance, and systems integration subsidiaries. The Company also incurred higher expenses in 1994, relative to 1993, for video services development. These cost increases were partially offset by the effect of the disposition of several non-strategic businesses, and reimbursements received from other Bell Communications Research, Inc. (Bellcore) owners who decided to participate in Bellcore's Advanced Intelligent Network project. This project previously was supported entirely by the Company. Due to the disposition of the Company's domestic computer maintenance subsidiary in October 1995, future periods will no longer include employee costs, depreciation and other operating expenses from this business. Total operating expenses related to this business were approximately $392 million, $450 million and $384 million for the years ended December 31, 1995, 1994 and 1993, respectively. EQUITY IN INCOME OF AFFILIATES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 107.5 83.4% - -------------------------------------------------------------------------------1994 - 1993 $ 58.1 82.1% - --------------------------------------------------------------------------------

Equity in income of affiliates includes equity income and losses and goodwill amortization related to the Company's investments in unconsolidated businesses. For comparative purposes, the domestic cellular and paging businesses previously consolidated in periods prior to July 1, 1995 are presented as though accounted for under the equity method. Equity in income of the Company's investment in domestic cellular and paging businesses was $267.1 million in 1995, compared to $122.0 million in 1994 and $56.9 million in 1993. The increase in both years was driven by strong revenue growth due to an increase of approximately 43% in 1995 and 58% in 1994 in the cellular subscriber base. Equity in income of affiliates in 1995 and 1994 was further boosted by improved operating results from the Company's investment in Telecom Corporation of New Zealand Limited (Telecom). Higher equity income from the Company's investments in domestic cellular and paging businesses and Telecom was partially offset in both years by the effects of goodwill amortization and equity losses associated with the

Company's investment in Grupo Iusacell, S. A. de C.V. (Iusacell). Results in 1995 were also impacted by equity losses associated with TELE-TV, the Company's multimedia joint venture which was formed in 1994. The equity losses associated with Iusacell were $87.8 million, $65.4 million and $3.0 million in 1995, 1994 and 1993, respectively. The equity losses in Iusacell in 1995 and 1994 were impacted by an increase in the Company's economic interest from 23.2% to 41.9% in August 1994 and by the effect of the devaluation of the Mexican peso on Iusacell's net liabilities, primarily debt, denominated in U.S. dollars. It is expected that the Company's equity in income of Iusacell will continue to be impacted positively or negatively by changes in the peso exchange rate. OTHER INCOME AND EXPENSE, NET
Dollars in Millions Increase (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ 295.5 - -------------------------------------------------------------------------------1994 - 1993 $ (16.2) - --------------------------------------------------------------------------------

Other income and expense, net consists primarily of interest and dividend income, and gains and losses from the disposition of subsidiaries and non- operating assets and investments. Other income and expense, net was $331.8 million in 1995, compared to $36.3 million in 1994. The increase in 1995 is principally attributable to the recognition of a pretax gain of approximately $314 million on the sale of certain cellular properties in connection with the formation of the Bell Atlantic NYNEX Mobile partnership (see Note 2 to the Consolidated Financial Statements). Other income and expense in 1994 included principally the pretax gains and losses associated with the aforementioned disposition of certain non-strategic businesses, and additional interest income related to notes receivable held by the Company in connection with the sale of its lease financing business. 16

Management's Discussion and Analysis continued In 1993, other income and expense, net totaled $52.5 million and consisted principally of a pretax gain of approximately $65 million related to the private sale of a portion of the Company's investment in Telecom offset, in part, by a pretax charge associated with the planned disposition of the Company's non- strategic software development businesses. INTEREST EXPENSE
Dollars in Millions (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (20.2) (3.6)% - -------------------------------------------------------------------------------1994 - 1993 $ (33.5) (5.6)% - --------------------------------------------------------------------------------

Interest expense decreased in 1995 and 1994 due to lower levels of debt, lower interest rates on long-term debt, and the recognition of increased capitalized interest costs at the telephone subsidiaries. Upon the discontinued application of regulatory accounting principles, effective August 1, 1994, the Company began recognizing capitalized interest costs as a reduction of interest expense. Previously, the Company recorded an allowance for funds used during construction as an item of other income. The decrease in 1994 was partially offset by interest expense related to debt instruments retained by the

Management's Discussion and Analysis continued In 1993, other income and expense, net totaled $52.5 million and consisted principally of a pretax gain of approximately $65 million related to the private sale of a portion of the Company's investment in Telecom offset, in part, by a pretax charge associated with the planned disposition of the Company's non- strategic software development businesses. INTEREST EXPENSE
Dollars in Millions (Decrease) - -------------------------------------------------------------------------------1995 - 1994 $ (20.2) (3.6)% - -------------------------------------------------------------------------------1994 - 1993 $ (33.5) (5.6)% - --------------------------------------------------------------------------------

Interest expense decreased in 1995 and 1994 due to lower levels of debt, lower interest rates on long-term debt, and the recognition of increased capitalized interest costs at the telephone subsidiaries. Upon the discontinued application of regulatory accounting principles, effective August 1, 1994, the Company began recognizing capitalized interest costs as a reduction of interest expense. Previously, the Company recorded an allowance for funds used during construction as an item of other income. The decrease in 1994 was partially offset by interest expense related to debt instruments retained by the Company in connection with the disposition of the Company's lease financing subsidiary, which was previously recognized as an operating expense. Also included in 1994 was interest expense related to the debt incurred to finance the Company's investment in Iusacell. INCOME TAXES
Dollars in Millions Increase - -------------------------------------------------------------------------------1995 - 1994 $ 262.7 - -------------------------------------------------------------------------------1994 - 1993 $ 92.9 - --------------------------------------------------------------------------------

EFFECTIVE INCOME TAX RATES
For the Years Ended December 31, - -------------------------------------------------------------------------------1995 38.1% - -------------------------------------------------------------------------------1994 38.7% - -------------------------------------------------------------------------------1993 34.8% - --------------------------------------------------------------------------------

The Company's effective income tax rate was lower in 1995, as compared to 1994, due principally to a decrease in the Pennsylvania state income tax rate during 1995 and the effect of recording additional deferred state income taxes on the Company's leveraged lease portfolio in 1994. The effect of these decreases was partially offset by the reduction in the amortization of investment tax credits and the elimination of the benefit of the income tax rate differential applied to reversing timing differences at the telephone subsidiaries, both as a result of the discontinued application of regulatory accounting principles in August 1994. The higher effective income tax rate in 1994, as compared to 1993, was due principally to the aforementioned tax impacts associated with the discontinued application of regulatory accounting principles in August 1994 and

tax impacts associated with the discontinued application of regulatory accounting principles in August 1994 and additional deferred taxes recognized on the Company's leveraged lease portfolio. A reconciliation of the statutory federal income tax rate to the effective income tax rate for each period is provided in Note 15 to the Consolidated Financial Statements. FACTORS THAT MAY IMPACT FUTURE RESULTS FEDERAL LEGISLATION The Telecommunications Act of 1996 (the "Act"), which became effective on February 8, 1996, is the most comprehensive revision of the federal communications laws in over 60 years. In general, the Act includes provisions that would open the telephone subsidiaries' local exchange markets to competition and would permit local exchange carriers, such as the Company, upon meeting certain conditions, to provide interLATA services (long distance) and video programming and to engage in manufacturing. With regard to the rules governing competition in the interLATA market, the Act takes a two-fold approach. Effective February 8, 1996, the Company is permitted to apply for approval to offer interLATA services outside of the geographic region in which it currently operates as a local exchange carrier. The Company has announced its plans to offer such services in Illinois, Florida, North Carolina, South Carolina, and Texas. Secondly, within the Company's geographic region, each of the telephone subsidiaries must demonstrate to the FCC that it has satisfied certain requirements in order to be permitted to offer interLATA services within its jurisdiction. Among the requirements with which a telephone subsidiary must comply is a 14-point "competitive checklist" which is aimed at ensuring that competitors have the ability to connect to the telephone subsidiary's network. A telephone subsidiary must also demonstrate to the FCC that its entry into the interLATA market would be in the public interest. No definitive prediction can be made as to the specific impact of the Act on the business or financial condition of the Company. The financial impact on the Company will be dependent on several factors, including the timing and extent of competition in the Company's markets and the timing and extent of the Company's pursuit of new business opportunities resulting from the Act. 17

Management's Discussion and Analysis continued COMPETITION IntraLATA Toll Services Competition to offer intrastate intraLATA toll services is currently permitted in all of the Company's state jurisdictions that provide intraLATA toll services. Increased competition from IXCs has resulted in a decline in several components of the telephone subsidiaries' toll service revenues. Currently, intraLATA toll calls in all of such jurisdictions are completed by the telephone subsidiaries unless the customer dials a five-digit access code. Presubscription for intraLATA toll services would enable customers to make intraLATA toll calls using the carrier of their choice without having to dial the five-digit access code. The Act prohibits a state from requiring presubscription or "dialing parity" until the earlier of such time as a local exchange carrier in the state is authorized to provide long distance services within the state or three years from the effective date of the Act. This prohibition does not apply to a final order for presubscription that was issued on or prior to December 19, 1995. During 1995, state regulatory commissions in Pennsylvania, New Jersey, West Virginia and Delaware conducted proceedings to determine whether, and under what conditions, to authorize presubscription. Proceedings in Delaware were suspended pending the outcome of the Congressional legislative process.

Management's Discussion and Analysis continued COMPETITION IntraLATA Toll Services Competition to offer intrastate intraLATA toll services is currently permitted in all of the Company's state jurisdictions that provide intraLATA toll services. Increased competition from IXCs has resulted in a decline in several components of the telephone subsidiaries' toll service revenues. Currently, intraLATA toll calls in all of such jurisdictions are completed by the telephone subsidiaries unless the customer dials a five-digit access code. Presubscription for intraLATA toll services would enable customers to make intraLATA toll calls using the carrier of their choice without having to dial the five-digit access code. The Act prohibits a state from requiring presubscription or "dialing parity" until the earlier of such time as a local exchange carrier in the state is authorized to provide long distance services within the state or three years from the effective date of the Act. This prohibition does not apply to a final order for presubscription that was issued on or prior to December 19, 1995. During 1995, state regulatory commissions in Pennsylvania, New Jersey, West Virginia and Delaware conducted proceedings to determine whether, and under what conditions, to authorize presubscription. Proceedings in Delaware were suspended pending the outcome of the Congressional legislative process. In October 1995, the West Virginia Public Service Commission issued an order directing the implementation of presubscription within eighteen months of that order. Bell Atlantic - West Virginia has filed an appeal with the West Virginia Supreme Court. On December 19, 1995, the Pennsylvania Public Utility Commission issued an order directing the implementation of presubscription within eighteen months of that order. However, the order stated that a reasonable effort should be made to coordinate implementation of presubscription with Bell Atlantic - Pennsylvania's entry into the interLATA market in Pennsylvania. In New Jersey, the Board of Public Utilities issued an order on December 14, 1995 finding that implementation of presubscription for intraLATA toll services in New Jersey would be in the public interest and proposed rules for implementation. The rulemaking to determine the timing of implementation of presubscription in New Jersey is expected to be held in 1996. Implementation of presubscription for intraLATA toll services could have a material negative impact on toll service revenues, especially if the telephone subsidiaries are not permitted contemporaneously to offer interLATA services. Local Exchange Services The ability to offer local exchange service has historically been subject to regulation by state public utility commissions. In 1994 and 1995, applications from competitors to provide and resell local exchange services were approved by the Maryland Public Service Commission and the Pennsylvania Public Utility Commission. In addition, applications from competitors to provide local exchange services are pending in Delaware, Maryland, New Jersey and Virginia. The Act is expected to significantly increase the level of competition in all of the telephone subsidiaries' local exchange markets. However, increased competition in the local exchange markets will facilitate FCC approval of the telephone subsidiaries' entry into the interLATA markets. BUSINESS DEVELOPMENT The Company expects to incur significant business development expenses in 1996 in connection with its investments in PCS PrimeCo and Omnitel-Pronto Italia, and its entry into the long distance business. OTHER MATTERS

ENVIRONMENTAL ISSUES The Company is subject to a number of environmental proceedings as a result of the operations of its subsidiaries and the shared liability provisions in the Plan of Reorganization related to the Modification of Final Judgement. Certain of these environmental matters relate to Superfund sites for which the Company's subsidiaries have been designated as potentially responsible parties by the U.S. Environmental Protection Agency or joined as thirdparty defendants in pending Superfund litigation. Such designation or joinder subjects the named company to potential liability for costs relating to cleanup of the affected sites. The Company is also responsible for the remediation of sites with underground fuel storage tanks and other expenses associated with environmental compliance. The Company continually monitors its operations with respect to potential environmental issues, including changes in legally mandated standards and remediation technologies. The Company's recorded liabilities reflect those specific situations where remediation activities are currently deemed to be probable and where the cost of remediation is estimable. Management believes that the aggregate amount of any additional potential liability would not have a material effect on the Company's results of operations or financial condition. 18

Management's Discussion and Analysis continued PROSPECTIVE ACCOUNTING CHANGE The Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123, "Accounting for Stock-based Compensation" (Statement No. 123) in October 1995. Statement No. 123 encourages companies to recognize expense for stock options and other stock-based employee compensation plans based on their fair value at the date of grant. As permitted by Statement No. 123, the Company plans to continue to apply its current accounting policy under APB Opinion No. 25, "Accounting for Stock Issued to Employees" in 1996 and future years, and will provide disclosure of the pro forma impact on net income and earnings per share as if the fair value-based method had been applied. FINANCIAL CONDITION
(Dollars in Millions) ------------------------------------------For the Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------Cash Flows From (Used In) Operating activities $ 3,981.0 $ 3,777.0 $ 4,169.5 Investing activities (2,090.8) (1,694.2) (2,968.2) Financing activities (1,676.3) (2,086.0) (1,351.2) ----------------------------

Management believes that the Company has adequate internal and external resources available to meet ongoing operating requirements, including network expansion and modernization and the payment of dividends. Management expects that presently foreseeable capital requirements will be financed primarily through internally generated funds. Additional long-term debt and equity financing may be needed to fund additional development activities and to maintain the Company's capital structure within management's guidelines. The Company determines the appropriateness of the level of its dividend payments on a periodic basis by considering such factors as long-term growth opportunities, internal requirements of the Company, and the expectations of shareowners. The use of derivatives by the Company is limited to managing risk that could endanger the financing and operating flexibility of the Company, making cash flows more stable over the long run, and achieving savings over traditional means of financing. Derivative agreements are tied to a specific liability or asset and hedge the related economic exposures. The use of these hedging agreements has not had a material impact on the Company's financial condition or results of operations. The Company does not hold derivatives for trading purposes.

Management's Discussion and Analysis continued PROSPECTIVE ACCOUNTING CHANGE The Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123, "Accounting for Stock-based Compensation" (Statement No. 123) in October 1995. Statement No. 123 encourages companies to recognize expense for stock options and other stock-based employee compensation plans based on their fair value at the date of grant. As permitted by Statement No. 123, the Company plans to continue to apply its current accounting policy under APB Opinion No. 25, "Accounting for Stock Issued to Employees" in 1996 and future years, and will provide disclosure of the pro forma impact on net income and earnings per share as if the fair value-based method had been applied. FINANCIAL CONDITION
(Dollars in Millions) ------------------------------------------For the Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------Cash Flows From (Used In) Operating activities $ 3,981.0 $ 3,777.0 $ 4,169.5 Investing activities (2,090.8) (1,694.2) (2,968.2) Financing activities (1,676.3) (2,086.0) (1,351.2) ----------------------------

Management believes that the Company has adequate internal and external resources available to meet ongoing operating requirements, including network expansion and modernization and the payment of dividends. Management expects that presently foreseeable capital requirements will be financed primarily through internally generated funds. Additional long-term debt and equity financing may be needed to fund additional development activities and to maintain the Company's capital structure within management's guidelines. The Company determines the appropriateness of the level of its dividend payments on a periodic basis by considering such factors as long-term growth opportunities, internal requirements of the Company, and the expectations of shareowners. The use of derivatives by the Company is limited to managing risk that could endanger the financing and operating flexibility of the Company, making cash flows more stable over the long run, and achieving savings over traditional means of financing. Derivative agreements are tied to a specific liability or asset and hedge the related economic exposures. The use of these hedging agreements has not had a material impact on the Company's financial condition or results of operations. The Company does not hold derivatives for trading purposes. CASH FLOWS FROM OPERATING ACTIVITIES The Company's primary source of funds continued to be cash generated from operations. Improved cash flows from operating activities during 1995 resulted principally from growth in operating income. Cash provided from operations in 1994 decreased versus 1993 due principally to higher income tax payments in 1994. CASH FLOWS USED IN INVESTING ACTIVITIES Capital expenditures continued to be the primary use of capital resources in 1995. During 1995, 1994 and 1993, the Company invested approximately $2.4 billion, $2.2 billion and $2.1 billion, respectively, in its network operations subsidiaries to facilitate the introduction of new products and services, enhance responsiveness to competitive challenges and increase the operating efficiency and productivity of the network. During 1995, the Company invested $392.4 million in joint ventures, including $292.0 million in PCS PrimeCo, primarily to fund the purchase of PCS licenses. During the first quarter of 1995, the Company prefunded a trust with $135.0 million in short-term investments for the purpose of compensating employees for vacation pay earned during 1994. At December 31, 1995, the trust held no investments.

19

Management's Discussion and Analysis continued In 1995, the Company received cash proceeds of approximately $362 million from the sale of certain cellular properties and approximately $250 million in connection with the sale of Bell Atlantic Business Systems Services, Inc. and the Company's interests in certain European computer maintenance operations. Cash proceeds from investing activities in 1995 also included approximately $221 million in connection with a note receivable resulting from the April 1994 sale of the Company's lease financing business and $87.0 million in connection with a note receivable established with the formation of the Bell Atlantic NYNEX Mobile partnership. In 1994, cash proceeds from investing activities included $1,323.8 million from the sale of the Company's lease financing subsidiary and $123.0 million from the disposition of certain other nonregulated subsidiaries. Additionally, the Company received $67.4 million under a special capital reduction plan implemented by Telecom in which 20% of Telecom's outstanding shares were canceled and shareowners received one New Zealand Dollar for each share canceled. Telecom's capital reduction did not change the Company's percentage ownership of Telecom. In 1993, the sale of a portion of the Company's interest in Telecom provided cash proceeds from investing activities of $253.7 million. In connection with Bell Atlantic's investment in Iusacell, the Company purchased shares in 1993 for $520.0 million and additional shares in 1994 for $524.0 million. The Company also used approximately $97 million in 1994 principally for the acquisition of a domestic cellular property, a minority interest in a directory company, and to fund an equity investment in a consortium that was awarded the second cellular license in Italy. In 1993, the Company used $190.0 million for the acquisition of two directory companies and certain other investments. CASH FLOWS USED IN FINANCING ACTIVITIES A bar chart is presented, depicting the following data:
Dividends Paid (dollars in millions) --------------------Year ended December 31, 1993 $ 1,156.5 Year ended December 31, 1994 $ 1,195.1 Year ended December 31, 1995 $ 1,218.0 - --------------------------------------------------------------------------------

Dividend payments in 1995, as in prior years, were a significant use of capital resources. The Company reduced its long-term debt (including capital leases) and short-term debt by $555.9 million in 1995, $990.2 million in 1994 and $168.2 million in 1993. Approximately $200 million, $250 million and $1.7 billion of debt in 1995, 1994 and 1993, respectively, was refinanced at more favorable interest rates. A bar chart is presented, depicting the following data:
Debt Ratio ---------At December 31, 1993 54.6% At December 31, 1994 59.4% At December 31, 1995 55.5% - --------------------------------------------------------------------------------

As of December 31, 1995, the Company and its subsidiaries had in excess of $2.2 billion of unused bank lines of credit. The Company and its telephone subsidiaries also have shelf registrations for the issuance of up to $1.9 billion of unsecured debt securities. The Company and its subsidiaries had $200.5 million in borrowings

Management's Discussion and Analysis continued In 1995, the Company received cash proceeds of approximately $362 million from the sale of certain cellular properties and approximately $250 million in connection with the sale of Bell Atlantic Business Systems Services, Inc. and the Company's interests in certain European computer maintenance operations. Cash proceeds from investing activities in 1995 also included approximately $221 million in connection with a note receivable resulting from the April 1994 sale of the Company's lease financing business and $87.0 million in connection with a note receivable established with the formation of the Bell Atlantic NYNEX Mobile partnership. In 1994, cash proceeds from investing activities included $1,323.8 million from the sale of the Company's lease financing subsidiary and $123.0 million from the disposition of certain other nonregulated subsidiaries. Additionally, the Company received $67.4 million under a special capital reduction plan implemented by Telecom in which 20% of Telecom's outstanding shares were canceled and shareowners received one New Zealand Dollar for each share canceled. Telecom's capital reduction did not change the Company's percentage ownership of Telecom. In 1993, the sale of a portion of the Company's interest in Telecom provided cash proceeds from investing activities of $253.7 million. In connection with Bell Atlantic's investment in Iusacell, the Company purchased shares in 1993 for $520.0 million and additional shares in 1994 for $524.0 million. The Company also used approximately $97 million in 1994 principally for the acquisition of a domestic cellular property, a minority interest in a directory company, and to fund an equity investment in a consortium that was awarded the second cellular license in Italy. In 1993, the Company used $190.0 million for the acquisition of two directory companies and certain other investments. CASH FLOWS USED IN FINANCING ACTIVITIES A bar chart is presented, depicting the following data:
Dividends Paid (dollars in millions) --------------------Year ended December 31, 1993 $ 1,156.5 Year ended December 31, 1994 $ 1,195.1 Year ended December 31, 1995 $ 1,218.0 - --------------------------------------------------------------------------------

Dividend payments in 1995, as in prior years, were a significant use of capital resources. The Company reduced its long-term debt (including capital leases) and short-term debt by $555.9 million in 1995, $990.2 million in 1994 and $168.2 million in 1993. Approximately $200 million, $250 million and $1.7 billion of debt in 1995, 1994 and 1993, respectively, was refinanced at more favorable interest rates. A bar chart is presented, depicting the following data:
Debt Ratio ---------At December 31, 1993 54.6% At December 31, 1994 59.4% At December 31, 1995 55.5% - --------------------------------------------------------------------------------

As of December 31, 1995, the Company and its subsidiaries had in excess of $2.2 billion of unused bank lines of credit. The Company and its telephone subsidiaries also have shelf registrations for the issuance of up to $1.9 billion of unsecured debt securities. The Company and its subsidiaries had $200.5 million in borrowings outstanding under bank lines of credit at December 31, 1995. The debt securities of Bell Atlantic's subsidiaries continue to be accorded high ratings by primary rating agencies.

In the fourth quarter of 1995, Bell Atlantic New Zealand Holdings, Inc. (BANZHI), a subsidiary of the Company, issued 600,000 shares of Series B Preferred Stock at a price per share of $100 with a dividend rate of $5.80 per share per annum resulting in a net cash inflow from financing activities of $59.5 million. In 1994, BANZHI also issued 850,000 shares of Series A Preferred Stock at a price per share of $100 with a dividend rate of $7.08 per share per annum resulting in cash proceeds of $85.0 million. 20

Report of Management The management of Bell Atlantic Corporation is responsible for the consolidated financial statements and the information and representations contained in this report. Management believes that the financial statements have been prepared in conformity with generally accepted accounting principles and that the information in this report is consistent with those statements. In meeting its responsibility for the financial statements of the Company, management maintains a strong internal control structure, including the appropriate control environment, accounting systems, and control procedures. The internal control structure is designed to provide reasonable assurance that assets are safeguarded from unauthorized use or disposition, that transactions are properly recorded and executed in accordance with management's authorizations, and that the financial records permit the preparation of reliable financial statements. There are, however, inherent limitations that should be recognized in considering the assurances provided by the internal control structure. The concept of reasonable assurance recognizes that the costs of the internal control structure should not exceed the benefits to be derived. The internal control structure is reviewed and evaluated on a regular basis. Compliance is monitored by the internal auditors through an annual plan of internal audits. The Board of Directors pursues its review and oversight role for the financial statements through an Audit Committee composed of six outside directors. The Audit Committee meets periodically with management and the Board of Directors. It also meets with representatives of the internal auditors and independent accountants and reviews the work of each to ensure that their respective responsibilities are being carried out and to discuss related matters. Both the internal auditors and independent accountants have direct access to the Audit Committee.
/s/ Raymond W. Smith Raymond W. Smith Chairman of the Board and Chief Executive Officer

/s/ William O. Albertini William O. Albertini Executive Vice President and Chief Financial Officer

Report of Independent Accountants TO THE BOARD OF DIRECTORS AND SHAREOWNERS OF BELL ATLANTIC CORPORATION: We have audited the accompanying consolidated balance sheets of Bell Atlantic Corporation and subsidiaries as of December 31, 1995 and 1994, and the related consolidated statements of operations and cash flows for each of the three years in the period ended December 31, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our

Report of Management The management of Bell Atlantic Corporation is responsible for the consolidated financial statements and the information and representations contained in this report. Management believes that the financial statements have been prepared in conformity with generally accepted accounting principles and that the information in this report is consistent with those statements. In meeting its responsibility for the financial statements of the Company, management maintains a strong internal control structure, including the appropriate control environment, accounting systems, and control procedures. The internal control structure is designed to provide reasonable assurance that assets are safeguarded from unauthorized use or disposition, that transactions are properly recorded and executed in accordance with management's authorizations, and that the financial records permit the preparation of reliable financial statements. There are, however, inherent limitations that should be recognized in considering the assurances provided by the internal control structure. The concept of reasonable assurance recognizes that the costs of the internal control structure should not exceed the benefits to be derived. The internal control structure is reviewed and evaluated on a regular basis. Compliance is monitored by the internal auditors through an annual plan of internal audits. The Board of Directors pursues its review and oversight role for the financial statements through an Audit Committee composed of six outside directors. The Audit Committee meets periodically with management and the Board of Directors. It also meets with representatives of the internal auditors and independent accountants and reviews the work of each to ensure that their respective responsibilities are being carried out and to discuss related matters. Both the internal auditors and independent accountants have direct access to the Audit Committee.
/s/ Raymond W. Smith Raymond W. Smith Chairman of the Board and Chief Executive Officer

/s/ William O. Albertini William O. Albertini Executive Vice President and Chief Financial Officer

Report of Independent Accountants TO THE BOARD OF DIRECTORS AND SHAREOWNERS OF BELL ATLANTIC CORPORATION: We have audited the accompanying consolidated balance sheets of Bell Atlantic Corporation and subsidiaries as of December 31, 1995 and 1994, and the related consolidated statements of operations and cash flows for each of the three years in the period ended December 31, 1995. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Bell Atlantic Corporation and subsidiaries as of December 31, 1995 and 1994, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 1995 in conformity with generally accepted accounting principles. As discussed in Notes 1 and 4 to the consolidated financial statements, the Company discontinued accounting for the operations of its telephone subsidiaries in accordance with Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation," effective August 1, 1994. Also, as discussed in Notes 1, 14 and 15 to the consolidated financial statements, the Company changed its method of accounting for income taxes and postemployment benefits in 1993.
/s/ Coopers & Lybrand L.L.P.

2400 Eleven Penn Center Philadelphia, Pennsylvania February 5, 1996

21 Bell Atlantic Corporation and Subsidiaries Consolidated Statements of Operations
(Dollars in Millions, Except Per Sha -----------------------------------FOR THE YEARS ENDED DECEMBER 31, 1995 1994 - ------------------------------------------------------------------------------------------------------OPERATING REVENUES $ 13,429.5 $ 13,791.4 OPERATING EXPENSES Employee costs, including benefits and taxes Depreciation and amortization Other

OPERATING INCOME Equity in Income of Affiliates Other Income and Expense, Net Interest Expense Income Before Provision for Income Taxes, Extraordinary Items, and Cumulative Effect of Changes in Accounting Principles Provision for Income Taxes INCOME BEFORE EXTRAORDINARY ITEMS AND CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES Extraordinary Items Discontinuation of regulatory accounting principles, net of tax Early extinguishment of debt, net of tax

4,022.0 2,627.1 3,694.2 ---------10,343.3 ---------3,086.2 152.5 331.7 561.0 ----------

4,333.1 2,652.1 4,001.6 ---------10,986.8 ---------2,804.6 41.1 23.2 582.1 ----------

3,009.4 1,147.6 ----------

2,286.8 884.9 ----------

1,861.8 ----------

1,401.9 ----------

(3.5) ---------(3.5) ----------

(2,150.0) (6.7) ---------(2,156.7) ----------

Cumulative Effect of Changes in Accounting Principles Income taxes Postemployment benefits, net of tax

NET INCOME (LOSS)

------------------$ 1,858.3 ==========

------------------$ (754.8) ==========

PER COMMON SHARE: INCOME BEFORE EXTRAORDINARY ITEMS AND CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES

$

4.25

$

3.21

Bell Atlantic Corporation and Subsidiaries Consolidated Statements of Operations
(Dollars in Millions, Except Per Sha -----------------------------------FOR THE YEARS ENDED DECEMBER 31, 1995 1994 - ------------------------------------------------------------------------------------------------------OPERATING REVENUES $ 13,429.5 $ 13,791.4 OPERATING EXPENSES Employee costs, including benefits and taxes Depreciation and amortization Other

OPERATING INCOME Equity in Income of Affiliates Other Income and Expense, Net Interest Expense Income Before Provision for Income Taxes, Extraordinary Items, and Cumulative Effect of Changes in Accounting Principles Provision for Income Taxes INCOME BEFORE EXTRAORDINARY ITEMS AND CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES Extraordinary Items Discontinuation of regulatory accounting principles, net of tax Early extinguishment of debt, net of tax

4,022.0 2,627.1 3,694.2 ---------10,343.3 ---------3,086.2 152.5 331.7 561.0 ----------

4,333.1 2,652.1 4,001.6 ---------10,986.8 ---------2,804.6 41.1 23.2 582.1 ----------

3,009.4 1,147.6 ----------

2,286.8 884.9 ----------

1,861.8 ----------

1,401.9 ----------

(3.5) ---------(3.5) ----------

(2,150.0) (6.7) ---------(2,156.7) ----------

Cumulative Effect of Changes in Accounting Principles Income taxes Postemployment benefits, net of tax

NET INCOME (LOSS)

------------------$ 1,858.3 ==========

------------------$ (754.8) ==========

PER COMMON SHARE: INCOME BEFORE EXTRAORDINARY ITEMS AND CUMULATIVE EFFECT OF CHANGES IN ACCOUNTING PRINCIPLES Extraordinary Items Cumulative Effect of Changes in Accounting Principles NET INCOME (LOSS)

$

4.25 (.01)

$

3.21 (4.94)

---------$ 4.24 ==========

---------$ (1.73) ==========

Weighted Average Number of Common Shares and Equivalent Shares Outstanding (in millions)

438.3 ==========

437.2 ==========

See Notes to Consolidated Financial Statements. 22 Bell Atlantic Corporation and Subsidiaries Consolidated Balance Sheets
(Dollars in Millions, Except Per Share Amounts) ----------------------------------------------1995 1994

DECEMBER 31,

Bell Atlantic Corporation and Subsidiaries Consolidated Balance Sheets
(Dollars in Millions, Except Per Share Amounts) ----------------------------------------------DECEMBER 31, 1995 1994 - --------------------------------------------------------------------------------------------------ASSETS Current Assets Cash and cash equivalents $ 356.8 $ 142.9 Accounts receivable, net of allowances of $189.8 and $188.9 2,386.0 2,328.1 Inventories 132.8 274.6 Prepaid expenses 611.7 545.5 Other 385.4 492.2 ------------------3,872.7 3,783.3 ------------------Plant, Property and Equipment 33,553.8 33,745.8 Less accumulated depreciation 17,632.5 16,807.7 ------------------15,921.3 16,938.1 ------------------Investments in Affiliates 2,950.5 1,590.5 Other Assets Total Assets 1,412.3 ---------$ 24,156.8 ========== 1,959.9 ---------$ 24,271.8 ==========

LIABILITIES AND SHAREOWNERS' INVESTMENT Current Liabilities Debt maturing within one year Accounts payable and accrued liabilities Other

$

Long-Term Debt Employee Benefit Obligations Deferred Credits and Other Liabilities Deferred income taxes Unamortized investment tax credits Other

1,930.2 2,723.5 719.3 ---------5,373.0 ---------6,407.2 ---------3,841.3 ---------1,213.9 147.3 345.5 ---------1,706.7 ---------145.0 ----------

$

2,087.6 2,737.4 751.7 ---------5,576.7 ---------6,805.7 ---------3,773.8 ---------1,305.7 176.7 466.9 ---------1,949.3 ---------85.0 ----------

Preferred Stock of Subsidiary

Commitments (Note 8) Shareowners' Investment Preferred and Preference stock ($1 par value; none issued) Common stock ($1 par value; 437,765,346 shares and 436,405,646 shares issued) Common stock issuable (92,899 shares) Contributed capital Reinvested earnings Foreign currency translation adjustment

437.8 5,506.4 1,776.5 (515.9) ---------7,204.8 3.1 518.1 ---------6,683.6 ---------$ 24,156.8 ==========

436.4 .1 5,428.4 1,144.4 (330.8) ---------6,678.5 11.0 586.2 ---------6,081.3 ---------$ 24,271.8 ==========

Less common stock in treasury, at cost Less deferred compensation-employee stock ownership plans

Total Liabilities and Shareowners' Investment

See Notes to Consolidated Financial Statements. 23 Bell Atlantic Corporation and Subsidiaries Consolidated Statements of Cash Flows
---------------FOR THE YEARS ENDED DECEMBER 31, 1995 - ------------------------------------------------------------------------------------------------------CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $ 1,858.3 $ ( Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 2,627.1 2, Extraordinary items, net of tax 3.5 2, Cumulative effect of changes in accounting principles, net of tax Gain on sale of cellular properties, net of tax (200.1) Equity in income of affiliates (152.5) Dividends received from affiliates 146.0 Other items, net 62.3 Changes in certain assets and liabilities, net of effects from acquisition/disposition of businesses: Accounts receivable (310.2) ( Inventories (47.6) Other assets (18.7) ( Accounts payable and accrued taxes 67.1 Deferred income taxes, net (95.4) ( Unamortized investment tax credits (29.4) Employee benefit obligations 84.8 Other liabilities (14.2) -------------Net cash provided by operating activities 3,981.0 3, -------------CASH FLOWS FROM INVESTING ACTIVITIES Purchases of short-term investments Proceeds from sale of short-term investments Additions to plant, property and equipment Proceeds from sale of plant, property and equipment Investment in finance lease and notes receivable Proceeds from finance lease and notes receivable Investment in notes receivable and preferred stock Proceeds from notes receivable Acquisition of businesses, less cash acquired Investment in Grupo Iusacell, S.A. de C.V. Proceeds from Telecom Corporation of New Zealand Limited 1994 capital reduction plan and 1993 sale of ownership interest Investment in joint ventures Proceeds from disposition of businesses Other, net Net cash used in investing activities

(135.0) 135.0 (2,627.2) 3.5 93.1 (55.0) 338.7 (41.4) (392.4) 611.2 (21.3) ---------(2,090.8) ----------

(2, (

(

1, ----(1, -----

CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from borrowings Principal repayments of borrowings and capital lease obligations Early extinguishment of debt Net change in short-term borrowings with original maturities of three months or less Dividends paid Proceeds from sale of common stock Purchase of common stock for treasury Net change in outstanding checks drawn on controlled disbursement accounts Proceeds from sale of preferred stock by subsidiary Net cash used in financing activities Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year

106.6 (439.3) (200.0) (48.1) (1,218.0) 76.9 (11.2) (2.7) 59.5 ---------(1,676.3) ---------213.9 142.9 ---------$ 356.8 ==========

( ( ( (1,

----(2, -----

----$ =====

Bell Atlantic Corporation and Subsidiaries Consolidated Statements of Cash Flows
---------------FOR THE YEARS ENDED DECEMBER 31, 1995 - ------------------------------------------------------------------------------------------------------CASH FLOWS FROM OPERATING ACTIVITIES Net income (loss) $ 1,858.3 $ ( Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 2,627.1 2, Extraordinary items, net of tax 3.5 2, Cumulative effect of changes in accounting principles, net of tax Gain on sale of cellular properties, net of tax (200.1) Equity in income of affiliates (152.5) Dividends received from affiliates 146.0 Other items, net 62.3 Changes in certain assets and liabilities, net of effects from acquisition/disposition of businesses: Accounts receivable (310.2) ( Inventories (47.6) Other assets (18.7) ( Accounts payable and accrued taxes 67.1 Deferred income taxes, net (95.4) ( Unamortized investment tax credits (29.4) Employee benefit obligations 84.8 Other liabilities (14.2) -------------Net cash provided by operating activities 3,981.0 3, -------------CASH FLOWS FROM INVESTING ACTIVITIES Purchases of short-term investments Proceeds from sale of short-term investments Additions to plant, property and equipment Proceeds from sale of plant, property and equipment Investment in finance lease and notes receivable Proceeds from finance lease and notes receivable Investment in notes receivable and preferred stock Proceeds from notes receivable Acquisition of businesses, less cash acquired Investment in Grupo Iusacell, S.A. de C.V. Proceeds from Telecom Corporation of New Zealand Limited 1994 capital reduction plan and 1993 sale of ownership interest Investment in joint ventures Proceeds from disposition of businesses Other, net Net cash used in investing activities

(135.0) 135.0 (2,627.2) 3.5 93.1 (55.0) 338.7 (41.4) (392.4) 611.2 (21.3) ---------(2,090.8) ----------

(2, (

(

1, ----(1, -----

CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from borrowings Principal repayments of borrowings and capital lease obligations Early extinguishment of debt Net change in short-term borrowings with original maturities of three months or less Dividends paid Proceeds from sale of common stock Purchase of common stock for treasury Net change in outstanding checks drawn on controlled disbursement accounts Proceeds from sale of preferred stock by subsidiary Net cash used in financing activities Increase (decrease) in cash and cash equivalents Cash and cash equivalents, beginning of year Cash and cash equivalents, end of year

106.6 (439.3) (200.0) (48.1) (1,218.0) 76.9 (11.2) (2.7) 59.5 ---------(1,676.3) ---------213.9 142.9 ---------$ 356.8 ==========

( ( ( (1,

----(2, -----

----$ =====

See Notes to Consolidated Financial Statements. 24

Notes to Consolidated Financial Statements (1) DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES DESCRIPTION OF BUSINESS Bell Atlantic Corporation (Bell Atlantic or the Company) is a diversified telecommunications company. Bell Atlantic's network operations subsidiaries provide voice and data transport and calling services, network access, directory publishing and public telephone services to customers in the mid-Atlantic region. The Company's network operations subsidiaries comprise seven operating telephone companies and a subsidiary that performs services on their behalf. Other network-related subsidiaries principally provide systems integration services, customer premises equipment distribution and video services. Through several joint ventures, Bell Atlantic provides wireless communications services in the United States and has invested in wireless businesses in Mexico, Italy, Slovakia, and the Czech Republic. The Company also has an investment in Telecom Corporation of New Zealand Limited, which provides a full range of telecommunications services. The Company and its subsidiaries have approximately 61,800 employees, of which approximately 55% are represented by the Communications Workers of America (CWA), and approximately 15% are represented by the International Brotherhood of Electrical Workers (IBEW), which are both affiliated with the American Federation of Labor-Congress of Industrial Organizations. The terms of a five- year contract with the IBEW became effective in May 1995 and expire in August 2000. The contract with the CWA expired on August 5, 1995. In January 1996, the Company's telephone subsidiaries and the CWA reached a tentative three-year labor agreement, which was subsequently ratified in February 1996. The Telecommunications Act of 1996 is the most comprehensive revision of the federal communications laws in over 60 years. In general, the Telecommunications Act includes provisions that would open the telephone subsidiaries' local exchange markets to competition and would permit local exchange carriers, such as the Company, upon meeting certain conditions, to provide interLATA services (long distance) and video programming and to engage in manufacturing. CONSOLIDATION AND BASIS OF PRESENTATION The consolidated financial statements include the accounts of Bell Atlantic Corporation and its majority-owned subsidiaries. Investments in businesses in which the Company does not have control, but has the ability to exercise significant influence over operating and financial policies, are accounted for using the equity method. Other investments are accounted for by the cost method. All significant intercompany accounts and transactions have been eliminated. The Company operates predominantly in a single industry segment - communications and related services. Effective August 1, 1994, the telephone subsidiaries discontinued accounting for their operations under the provisions of Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation" (Statement No. 71) (see Note 4). USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, and liabilities and disclosure of contingencies. Actual results could differ from those estimates. REVENUE RECOGNITION Revenues are recognized as earned on the accrual basis. The telephone subsidiaries recognize revenues when services are rendered based on usage of the Company's local exchange network and facilities. Other subsidiaries recognize revenues when products are delivered or services are rendered to customers. Revenues recognized from leasing transactions are recorded in accordance with Statement of Financial

Notes to Consolidated Financial Statements (1) DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES DESCRIPTION OF BUSINESS Bell Atlantic Corporation (Bell Atlantic or the Company) is a diversified telecommunications company. Bell Atlantic's network operations subsidiaries provide voice and data transport and calling services, network access, directory publishing and public telephone services to customers in the mid-Atlantic region. The Company's network operations subsidiaries comprise seven operating telephone companies and a subsidiary that performs services on their behalf. Other network-related subsidiaries principally provide systems integration services, customer premises equipment distribution and video services. Through several joint ventures, Bell Atlantic provides wireless communications services in the United States and has invested in wireless businesses in Mexico, Italy, Slovakia, and the Czech Republic. The Company also has an investment in Telecom Corporation of New Zealand Limited, which provides a full range of telecommunications services. The Company and its subsidiaries have approximately 61,800 employees, of which approximately 55% are represented by the Communications Workers of America (CWA), and approximately 15% are represented by the International Brotherhood of Electrical Workers (IBEW), which are both affiliated with the American Federation of Labor-Congress of Industrial Organizations. The terms of a five- year contract with the IBEW became effective in May 1995 and expire in August 2000. The contract with the CWA expired on August 5, 1995. In January 1996, the Company's telephone subsidiaries and the CWA reached a tentative three-year labor agreement, which was subsequently ratified in February 1996. The Telecommunications Act of 1996 is the most comprehensive revision of the federal communications laws in over 60 years. In general, the Telecommunications Act includes provisions that would open the telephone subsidiaries' local exchange markets to competition and would permit local exchange carriers, such as the Company, upon meeting certain conditions, to provide interLATA services (long distance) and video programming and to engage in manufacturing. CONSOLIDATION AND BASIS OF PRESENTATION The consolidated financial statements include the accounts of Bell Atlantic Corporation and its majority-owned subsidiaries. Investments in businesses in which the Company does not have control, but has the ability to exercise significant influence over operating and financial policies, are accounted for using the equity method. Other investments are accounted for by the cost method. All significant intercompany accounts and transactions have been eliminated. The Company operates predominantly in a single industry segment - communications and related services. Effective August 1, 1994, the telephone subsidiaries discontinued accounting for their operations under the provisions of Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation" (Statement No. 71) (see Note 4). USE OF ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets, and liabilities and disclosure of contingencies. Actual results could differ from those estimates. REVENUE RECOGNITION Revenues are recognized as earned on the accrual basis. The telephone subsidiaries recognize revenues when services are rendered based on usage of the Company's local exchange network and facilities. Other subsidiaries recognize revenues when products are delivered or services are rendered to customers. Revenues recognized from leasing transactions are recorded in accordance with Statement of Financial

Accounting Standards No. 13, "Accounting for Leases." CASH AND CASH EQUIVALENTS The Company considers all highly liquid investments with a maturity of 90 days or less when purchased to be cash equivalents. Cash equivalents are stated at cost, which approximates market value. SHORT-TERM INVESTMENTS Short-term investments consist of investments that mature 91 days to 12 months from the date of purchase. Short-term investments are stated at cost, which approximates market value. INVENTORIES New and reusable materials of the telephone subsidiaries are carried in inventory, principally at average original cost, except that specific costs are used in the case of large individual items. Inventories of other subsidiaries are carried at the lower of cost (determined principally on either an average or first-in, first-out basis) or market. 25

Notes to Consolidated Financial Statements continued Note 1 continued PREPAID DIRECTORY Costs of directory production and advertising sales are principally deferred until the directory is published. Such costs are amortized to expense and the related advertising revenues are recognized over the average life of the directory, which is generally 12 months. PLANT AND DEPRECIATION The telephone subsidiaries' provision for depreciation is based principally on the composite group remaining life method of depreciation and straight-line composite rates. This method provides for the recovery of the remaining net investment in telephone plant, less anticipated net salvage value, over the remaining asset lives. The composite group method requires periodic revisions to depreciation rates based on a number of variables, including retirement estimates, survivor curves, salvage, and cost of removal. In connection with the discontinued application of Statement No. 71, effective August 1, 1994, for financial reporting purposes, the Company began using estimated asset lives for certain categories of plant and equipment that were shorter than those approved by regulators prior to the discontinuance of Statement No. 71. The shorter lives result principally from the Company's expectation as to the revenue-producing lives of the assets. The following asset lives were used by the telephone subsidiaries in 1994 and 1995:
January 1, 1994 to Effective July 31, August 1, Average Lives (in years) 1994 1994 1995 - -------------------------------------------------------------------------------Buildings 18-60 18-40 15-40 Central office equipment 6-13 4-12 5-12 Cable, wiring and conduit 20-60 14-50 16-50 Other equipment 6-38 6-38 5-35

When depreciable plant of the telephone subsidiaries is replaced or retired, the amounts at which such plant has been carried in plant, property and equipment are removed from the respective accounts and charged to accumulated depreciation, and any gains or losses on disposition are amortized over the remaining asset lives of

Notes to Consolidated Financial Statements continued Note 1 continued PREPAID DIRECTORY Costs of directory production and advertising sales are principally deferred until the directory is published. Such costs are amortized to expense and the related advertising revenues are recognized over the average life of the directory, which is generally 12 months. PLANT AND DEPRECIATION The telephone subsidiaries' provision for depreciation is based principally on the composite group remaining life method of depreciation and straight-line composite rates. This method provides for the recovery of the remaining net investment in telephone plant, less anticipated net salvage value, over the remaining asset lives. The composite group method requires periodic revisions to depreciation rates based on a number of variables, including retirement estimates, survivor curves, salvage, and cost of removal. In connection with the discontinued application of Statement No. 71, effective August 1, 1994, for financial reporting purposes, the Company began using estimated asset lives for certain categories of plant and equipment that were shorter than those approved by regulators prior to the discontinuance of Statement No. 71. The shorter lives result principally from the Company's expectation as to the revenue-producing lives of the assets. The following asset lives were used by the telephone subsidiaries in 1994 and 1995:
January 1, 1994 to Effective July 31, August 1, Average Lives (in years) 1994 1994 1995 - -------------------------------------------------------------------------------Buildings 18-60 18-40 15-40 Central office equipment 6-13 4-12 5-12 Cable, wiring and conduit 20-60 14-50 16-50 Other equipment 6-38 6-38 5-35

When depreciable plant of the telephone subsidiaries is replaced or retired, the amounts at which such plant has been carried in plant, property and equipment are removed from the respective accounts and charged to accumulated depreciation, and any gains or losses on disposition are amortized over the remaining asset lives of the remaining net investment in telephone plant. Plant, property and equipment of other subsidiaries is depreciated principally on a straight-line basis over the following estimated useful lives, effective July 1, 1995: buildings, 25 to 40 years; and other equipment, 2 to 10 years. Previously, these assets were depreciated using 15 to 40 years and 2 to 15 years, respectively. The change in estimated useful lives resulted from the contribution of plant, property and equipment of the Company's domestic cellular and paging subsidiaries to Bell Atlantic NYNEX Mobile (see Note 2). When the depreciable assets of other subsidiaries are retired or otherwise disposed of, the related cost and accumulated depreciation are removed from the respective accounts, and any gains or losses on disposition are recognized in income. MAINTENANCE AND REPAIRS The cost of maintenance and repairs, including the cost of replacing minor items not constituting substantial betterments, is charged to operating expense. CAPITALIZED INTEREST COST Upon the discontinued application of Statement No. 71, effective August 1, 1994, the telephone subsidiaries

began reporting capitalized interest as a cost of telephone plant and equipment and a reduction in interest expense, in accordance with the provisions of Statement of Financial Accounting Standards No. 34, "Capitalization of Interest Cost" (Statement No. 34). The Company's other subsidiaries account for capitalized interest in accordance with Statement No. 34 provisions. Prior to the discontinued application of Statement No. 71, the telephone subsidiaries recorded an allowance for funds used during construction, which included both interest and equity return components, as a cost of plant and as an item of other income. COST IN EXCESS OF NET ASSETS ACQUIRED The excess of the acquisition cost over the fair value of net assets of businesses acquired is amortized by the straight-line method over periods not exceeding 40 years. The Company assesses the impairment of the cost in excess of net assets acquired related to consolidated subsidiaries in accordance with Statement of Financial Accounting Standards No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed Of." The cost in excess of net assets acquired related to affiliates accounted for under the equity method is reviewed whenever events or changes in circumstances indicate that the carrying value may not be recoverable and a determination of impairment (if any) is made based on estimates of future cash flows. FOREIGN CURRENCY Assets and liabilities of foreign subsidiaries and equity investees are translated into U.S. dollars at exchange rates in effect at the end of the reporting period. Foreign entity revenues and expenses are translated into U.S. dollars at the 26

Notes to Consolidated Financial Statements continued Note 1 continued average rates that prevailed during the period. The resultant net translation gains and losses are reported as foreign currency translation adjustments in Shareowners' Investment. Exchange gains and losses on transactions of the Company and its equity investees denominated in a currency other than their functional currency are generally included in results of operations as incurred. Exchange gains and losses on intercompany foreign currency transactions of a long-term investment nature are reported as foreign currency translation adjustments in Shareowners' Investment. HEDGING INSTRUMENTS The Company periodically enters into hedging agreements to reduce its exposure to fluctuations in foreign exchange rates and interest rates. Forward exchange contracts are generally used to hedge the exposure to currency fluctuations on certain shortterm transactions denominated in a currency other than the entities' functional currency. Gains and losses on these contracts generally offset the foreign exchange gains and losses on the underlying hedged transactions and are included in results of operations. The discount or premium on these contracts is included in results of operations over the life of the contract. Gains and losses on forward exchange contracts which hedge identifiable foreign currency commitments are deferred and reflected as adjustments to the related transactions. Gains and losses and related discounts or premiums arising from financial instruments that hedge foreign balances of a long-term investment nature are included as foreign currency translation adjustments in Shareowners' Investment. Interest rate hedge agreements are used to reduce interest rate risks and costs inherent in the Company's debt portfolio. These agreements involve the exchange of fixed and variable interest rate payments over the life of the

Notes to Consolidated Financial Statements continued Note 1 continued average rates that prevailed during the period. The resultant net translation gains and losses are reported as foreign currency translation adjustments in Shareowners' Investment. Exchange gains and losses on transactions of the Company and its equity investees denominated in a currency other than their functional currency are generally included in results of operations as incurred. Exchange gains and losses on intercompany foreign currency transactions of a long-term investment nature are reported as foreign currency translation adjustments in Shareowners' Investment. HEDGING INSTRUMENTS The Company periodically enters into hedging agreements to reduce its exposure to fluctuations in foreign exchange rates and interest rates. Forward exchange contracts are generally used to hedge the exposure to currency fluctuations on certain shortterm transactions denominated in a currency other than the entities' functional currency. Gains and losses on these contracts generally offset the foreign exchange gains and losses on the underlying hedged transactions and are included in results of operations. The discount or premium on these contracts is included in results of operations over the life of the contract. Gains and losses on forward exchange contracts which hedge identifiable foreign currency commitments are deferred and reflected as adjustments to the related transactions. Gains and losses and related discounts or premiums arising from financial instruments that hedge foreign balances of a long-term investment nature are included as foreign currency translation adjustments in Shareowners' Investment. Interest rate hedge agreements are used to reduce interest rate risks and costs inherent in the Company's debt portfolio. These agreements involve the exchange of fixed and variable interest rate payments over the life of the agreement without the exchange of the underlying principal amounts. The interest differential to be paid or received under these agreements is accrued as interest rates change and is recognized as an adjustment to interest expense over the life of the agreements. EMPLOYEE BENEFITS Pensions, Postretirement Benefits Other Than Pensions, and Postemployment Benefits Substantially all employees of the Company are covered under noncontributory defined benefit pension plans and postretirement health and life insurance benefit plans. Amounts contributed to the Company's pension plans are actuarially determined, principally under the aggregate cost actuarial method, and are subject to applicable federal tax regulations. Amounts contributed to 501(c)(9) trusts and 401(h) accounts under applicable federal income tax regulations to pay certain postretirement benefits are actuarially determined, principally under the aggregate cost actuarial method. The Company also provides employees with postemployment benefits such as disability benefits, workers' compensation, and severance pay. Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits." Savings Plans and Employee Stock Ownership Plans The Company maintains savings plans which cover substantially all of its employees. A substantial portion of the Company's matching contribution is provided through employee stock ownership plans (ESOPs). The Company recognizes expense based on accounting rules applicable to companies with ESOP trusts that held securities prior to December 15, 1989. Under this method, the Company recognizes 80 percent of the cumulative expense that

would have been recognized under the shares allocated method. The 80 percent of shares allocated method is applied until cumulative cash payments exceed the cumulative minimum charge. Subsequently, expense is recognized such that cumulative expense equals cumulative cash payments. The transition from the 80 percent of shares allocated method to the cash payments method occurred during 1995. All ESOP shares are included in earnings per share computations. The obligations of the ESOP trusts, which are guaranteed by the Company, are recorded as long-term debt and the offsetting deferred compensation is classified as a reduction of Shareowners' Investment. As the ESOP trusts make principal payments, the Company reduces the long-term debt balance. The deferred compensation balance is reduced by the amount of employee compensation recognized as the ESOP shares are allocated to participants. INCOME TAXES Bell Atlantic Corporation and its domestic subsidiaries file a consolidated federal income tax return. Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" (Statement No. 109). The Tax Reform Act of 1986 repealed the investment tax credit (ITC) as of January 1, 1986, subject to certain transitional rules. ITCs of the telephone subsidiaries were deferred and are being amortized as a reduction to income tax expense over the estimated service lives of the related assets. 27

Notes to Consolidated Financial Statements continued Note 1, continued EARNINGS PER COMMON SHARE Earnings per common share calculations are based on the weighted average number of shares and equivalent shares outstanding during the year. PROSPECTIVE ACCOUNTING CHANGE The Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123, "Accounting for Stock-based Compensation" (Statement No. 123) in October 1995. Statement No. 123 encourages companies to recognize expense for stock options and other stock-based employee compensation plans based on their fair value at the date of grant. As permitted by Statement No. 123, the Company plans to continue to apply its current accounting policy under APB Opinion No. 25, "Accounting for Stock Issued to Employees" in 1996 and future years, and will provide disclosure of the pro forma impact on net income and earnings per share as if the fair value-based method had been applied. RECLASSIFICATIONS Certain reclassifications of prior years' data have been made to conform to 1995 classifications.

(2) FORMATION OF WIRELESS PARTNERSHIP Effective July 1, 1995, Bell Atlantic and NYNEX Corporation (NYNEX) completed the combination of substantially all of their domestic cellular and paging businesses and the formation of a partnership, Bell Atlantic NYNEX Mobile, which owns and operates such businesses. Bell Atlantic NYNEX Mobile operates as a general partnership and is controlled equally by Bell Atlantic and NYNEX. Bell Atlantic owns an approximate 63% equity interest in Bell Atlantic NYNEX Mobile. The Company accounts for its interest in the partnership under the equity method.

Notes to Consolidated Financial Statements continued Note 1, continued EARNINGS PER COMMON SHARE Earnings per common share calculations are based on the weighted average number of shares and equivalent shares outstanding during the year. PROSPECTIVE ACCOUNTING CHANGE The Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 123, "Accounting for Stock-based Compensation" (Statement No. 123) in October 1995. Statement No. 123 encourages companies to recognize expense for stock options and other stock-based employee compensation plans based on their fair value at the date of grant. As permitted by Statement No. 123, the Company plans to continue to apply its current accounting policy under APB Opinion No. 25, "Accounting for Stock Issued to Employees" in 1996 and future years, and will provide disclosure of the pro forma impact on net income and earnings per share as if the fair value-based method had been applied. RECLASSIFICATIONS Certain reclassifications of prior years' data have been made to conform to 1995 classifications.

(2) FORMATION OF WIRELESS PARTNERSHIP Effective July 1, 1995, Bell Atlantic and NYNEX Corporation (NYNEX) completed the combination of substantially all of their domestic cellular and paging businesses and the formation of a partnership, Bell Atlantic NYNEX Mobile, which owns and operates such businesses. Bell Atlantic NYNEX Mobile operates as a general partnership and is controlled equally by Bell Atlantic and NYNEX. Bell Atlantic owns an approximate 63% equity interest in Bell Atlantic NYNEX Mobile. The Company accounts for its interest in the partnership under the equity method. Coincident with, and as a condition to, the completion of the combination, Bell Atlantic sold certain cellular properties in Massachusetts and Rhode Island. The Company recorded a pretax gain of approximately $314 million on the sale of the cellular properties in 1995. Bell Atlantic contributed certain assets and liabilities of its domestic cellular and paging operating subsidiaries in exchange for an equity interest in Bell Atlantic NYNEX Mobile. No gain or loss was recognized on the contribution of the assets and liabilities. The following amounts were contributed in 1995 by the Company to the partnership:
(Dollars in Millions) - -------------------------------------------------------------------------------Current assets $ 124.0 Noncurrent assets 1,291.3 ---------Total assets $ 1,415.3 Current liabilities $ 167.1 Noncurrent liabilities 70.1 ---------Total liabilities 237.2 ---------Net assets contributed $ 1,178.1 ==========

An equity investment of approximately $143 million in a preexisting cellular partnership with NYNEX serving the New York metropolitan area was retained by the Company. This investment is scheduled to be contributed to

the Bell Atlantic NYNEX Mobile partnership in July 1996 and July 1997, pursuant to the partnership agreement. Revenues and expenses of the Company's domestic cellular and paging businesses reflected in the financial statements for periods prior to the formation of the partnership are as follows:
(Dollars in - ------------------------------------------------------------------------------------------------------Six months ended Year ended Y June 30, 1995 December 31, 1994 December - ------------------------------------------------------------------------------------------------------Operating revenues $ 629.9 $ 1,063.3 $ Operating expenses 532.0 947.6 ------------------Operating income 97.9 115.7 Equity in income of unconsolidated affiliates 22.6 34.2 Other expenses, net .1 13.1 Interest expense 13.9 14.8 ------------------Income before income taxes $ 106.5 $ 122.0 $ ========== ========== =

28

Notes to Consolidated Financial Statements continued (3) INVESTMENTS IN AFFILIATES The Company's investments in affiliates, which are accounted for under the equity method, consist of the following at December 31:
- ------------------------------------------------------------------------------------------------------1995 Ownership Investment Owner - ------------------------------------------------------------------------------------------------------Bell Atlantic NYNEX Mobile/*/ 62.594% $ 1,446.7 PCS PrimeCo 25.0% 298.8 2 Telecom Corporation of New Zealand Limited 24.8% 639.4 2 Grupo Iusacell, S.A. de C.V. 41.9% 356.2 4 Other Various 209.4 Var --------Total $ 2,950.5 =========

* Includes the Company's investment in a New York cellular partnership (see Note 2) The Bell Atlantic NYNEX Mobile partnership, which was formed on July 1, 1995 through the combination of substantially all of the domestic cellular and paging businesses of Bell Atlantic and NYNEX (see Note 2), provides wireless local services to customers in the Northeast, mid-Atlantic, Southeast and Southwest domestic cellular markets. PCS PrimeCo, which was formed in October 1994, is a four-way partnership of Bell Atlantic, NYNEX, AirTouch Communications and U S West, Inc. In March 1995, the PCS PrimeCo partnership acquired licenses for approximately $1.1 billion which will allow PCS PrimeCo to provide personal communications services (PCS) in 11 major markets across the United States. Telecom Corporation of New Zealand Limited (Telecom) is the principal provider of telecommunications services in that country. At the date of acquisition in 1990, the Company's interest in Telecom exceeded the recorded value of the proportionate share of the underlying net assets by approximately $285 million. This amount is being amortized by the straight-line method over a period of 40 years.

Notes to Consolidated Financial Statements continued (3) INVESTMENTS IN AFFILIATES The Company's investments in affiliates, which are accounted for under the equity method, consist of the following at December 31:
- ------------------------------------------------------------------------------------------------------1995 Ownership Investment Owner - ------------------------------------------------------------------------------------------------------Bell Atlantic NYNEX Mobile/*/ 62.594% $ 1,446.7 PCS PrimeCo 25.0% 298.8 2 Telecom Corporation of New Zealand Limited 24.8% 639.4 2 Grupo Iusacell, S.A. de C.V. 41.9% 356.2 4 Other Various 209.4 Var --------Total $ 2,950.5 =========

* Includes the Company's investment in a New York cellular partnership (see Note 2) The Bell Atlantic NYNEX Mobile partnership, which was formed on July 1, 1995 through the combination of substantially all of the domestic cellular and paging businesses of Bell Atlantic and NYNEX (see Note 2), provides wireless local services to customers in the Northeast, mid-Atlantic, Southeast and Southwest domestic cellular markets. PCS PrimeCo, which was formed in October 1994, is a four-way partnership of Bell Atlantic, NYNEX, AirTouch Communications and U S West, Inc. In March 1995, the PCS PrimeCo partnership acquired licenses for approximately $1.1 billion which will allow PCS PrimeCo to provide personal communications services (PCS) in 11 major markets across the United States. Telecom Corporation of New Zealand Limited (Telecom) is the principal provider of telecommunications services in that country. At the date of acquisition in 1990, the Company's interest in Telecom exceeded the recorded value of the proportionate share of the underlying net assets by approximately $285 million. This amount is being amortized by the straight-line method over a period of 40 years. Through purchases of stock totaling $1,044.0 million, the Company has acquired a 41.9% economic interest in Grupo Iusacell, S.A. de C.V. (Iusacell), the second largest telecommunications company in Mexico. Shares held by Bell Atlantic represent approximately 44% of the voting rights pertaining to Iusacell stock. At acquisition, the cumulative investment in Iusacell exceeded the recorded value of the underlying net assets by approximately $760 million. This amount is being amortized by the straight-line method over a period of 25 years. As a result of foreign currency translation losses recorded as a component of Shareowners' Investment, the Company's investment in Iusacell was reduced by approximately $530 million at December 31, 1995 and by approximately $330 million at December 31, 1994. The Company also has telecommunications investments in Italy, Slovakia, and the Czech Republic. These investments consist of joint ventures to build and operate cellular networks in these countries. Other investments also include a video services joint venture, real estate partnerships, a one-seventh interest in Bell Communications Research, Inc. (Bellcore), and several other domestic and international joint ventures. During 1995, 1994 and 1993, the Company received dividends from unconsolidated equity investees of $146.0 million, $101.0 million and $73.4 million. Summarized unaudited financial information for investments which the Company accounts for under the equity method is shown below on a 100 percent basis.

(Dollars in Millions) - -------------------------------------------------------------------------------Year Ended December 31, 1995 - -------------------------------------------------------------------------------Results of Operations: Revenues $ 5,088.8 Operating income 926.9 Net income 407.1 Bell Atlantic's Equity in Income of Affiliates $ 152.5 ========

(Dollars in Millions) - -------------------------------------------------------------------------------December 31, 1995 - -------------------------------------------------------------------------------Financial Position: Current assets $ 1,707.8 Noncurrent assets 8,370.6 Current liabilities 2,697.8 Noncurrent liabilities 1,260.9 Minority interests 253.9 Stockholders' equity 5,865.8 Bell Atlantic's Investments in Affiliates $2,950.5 ========

The unaudited summarized financial information at December 31, 1995 includes net assets of foreign unconsolidated subsidiaries totaling approximately $2.1 billion (on a 100% basis), of which $1.4 billion is located in New Zealand and the remainder is located in Mexico and European and Asian countries. These assets may be subject to risks in the event of changes in government policies or other unforeseen circumstances. 29

Notes to Consolidated Financial Statements continued (4) DISCONTINUATION OF REGULATORY ACCOUNTING PRINCIPLES In the third quarter of 1994, the Company determined that it was no longer eligible for continued application of the accounting required by Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation" (Statement No. 71). In connection with the decision to discontinue regulatory accounting principles under Statement No. 71, the Company recorded a noncash, extraordinary charge of $2,150.0 million, which is net of an income tax benefit of $1,498.4 million. The Company's determination that it was no longer eligible for continued application of the accounting required by Statement No. 71 was based on the belief that the convergence of competition, technological change, actual and potential regulatory, legislative and judicial actions, and other factors were creating fully open and competitive markets. In such markets, the Company does not believe it can be assured that prices can be maintained at levels that will recover the net carrying amount of existing telephone plant and equipment, which has been depreciated over relatively long regulator-prescribed lives. In addition, changes from cost-based regulation to various forms of incentive regulation in all jurisdictions contributed to the determination that the continued application of Statement No. 71 was inappropriate. A summary of the components of the after-tax charge recognized as a result of the discontinued application of Statement No. 71 follows:
(Dollars in Millions) - -------------------------------------------------------------------------------Increase in plant and equipment depreciation reserve $ 2,128.9 Accelerated investment

Notes to Consolidated Financial Statements continued (4) DISCONTINUATION OF REGULATORY ACCOUNTING PRINCIPLES In the third quarter of 1994, the Company determined that it was no longer eligible for continued application of the accounting required by Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation" (Statement No. 71). In connection with the decision to discontinue regulatory accounting principles under Statement No. 71, the Company recorded a noncash, extraordinary charge of $2,150.0 million, which is net of an income tax benefit of $1,498.4 million. The Company's determination that it was no longer eligible for continued application of the accounting required by Statement No. 71 was based on the belief that the convergence of competition, technological change, actual and potential regulatory, legislative and judicial actions, and other factors were creating fully open and competitive markets. In such markets, the Company does not believe it can be assured that prices can be maintained at levels that will recover the net carrying amount of existing telephone plant and equipment, which has been depreciated over relatively long regulator-prescribed lives. In addition, changes from cost-based regulation to various forms of incentive regulation in all jurisdictions contributed to the determination that the continued application of Statement No. 71 was inappropriate. A summary of the components of the after-tax charge recognized as a result of the discontinued application of Statement No. 71 follows:
(Dollars in Millions) - -------------------------------------------------------------------------------Increase in plant and equipment depreciation reserve $ 2,128.9 Accelerated investment tax credit amortization (136.2) Tax-related regulatory asset and liability elimination 42.5 Other regulatory asset and liability elimination 114.8 ---------Total $ 2,150.0 ==========

The increase in the accumulated depreciation reserve was supported by both an impairment analysis, which identified estimated amounts not recoverable from future discounted cash flows, and a depreciation study, which identified inadequate depreciation reserve levels which the Company believes resulted principally from the cumulative underdepreciation of plant as a result of the regulatory process. Investment tax credit amortization was accelerated as a result of the reduction in remaining asset lives of the associated telephone plant and equipment. Tax-related regulatory assets of $757.2 million and tax-related regulatory liabilities of $714.7 million, which were established upon the adoption of Statement No. 109 and amortized as the related deferred taxes were recognized in the ratemaking process, were eliminated (see Note 15). The elimination of other regulatory assets and liabilities relates principally to deferred debt refinancing and vacation pay costs, which were being amortized as they were recognized in the ratemaking process.

(5) PLANT, PROPERTY AND EQUIPMENT Plant, property and equipment, which is stated at cost, is summarized as follows at December 31:
(Dollars in Millions) - -------------------------------------------------------------------------------1995 1994 - -------------------------------------------------------------------------------Land $ 262.2 $ 273.5 Buildings 2,736.8 2,741.7

Central office equipment Cable, wiring and conduit Other equipment Other Construction-in-progress

Accumulated depreciation Total

12,812.6 12,404.6 4,145.7 619.4 572.5 -----------33,553.8 (17,632.5) -----------$ 15,921.3 ============

12,261.8 12,074.9 4,976.2 587.6 830.1 -----------33,745.8 (16,807.7) -----------$ 16,938.1 ============

Due to the formation of the Bell Atlantic NYNEX Mobile partnership (see Note 2) and the disposition of the Company's domestic computer maintenance subsidiary, Bell Atlantic Business Systems Services, Inc. (see Note 6), plant, property and equipment at December 31, 1995 no longer includes fixed assets of these businesses. At December 31, 1994, amounts related to these businesses, principally other equipment, totaled $933.5 million, net of accumulated depreciation of $484.5 million. Certain prior year amounts previously included in Construction-in-progress have been reclassified to Other to conform to 1995 classifications. Plant, property and equipment at December 31, 1995 and 1994 includes real estate property under operating leases, or held for lease, of $327.5 million and $313.4 million, less accumulated depreciation of $82.3 million and $71.0 million, respectively. 30

Notes to Consolidated Financial Statements continued (6) DISPOSITION OF BUSINESSES COMPUTER MAINTENANCE In the fourth quarter of 1995, the Company sold its domestic computer maintenance subsidiary, Bell Atlantic Business Systems Services, Inc., and its interests in certain European computer maintenance operations for approximately $250 million in cash. The Company recorded a small gain as a result of this disposition. This disposition did not have a material effect on the Company's results of operations or financial position. LEASE FINANCING In the second quarter of 1994, the Company sold the assets of Bell Atlantic TriCon Leasing Corporation (TriCon), except for leveraged lease and project finance portfolios, to The Finova Group Inc. (Finova) (formerly GFC Financial Corporation). The sale price consisted of $344.2 million in cash and $835.9 million in notes receivable, plus the assumption of $81.8 million of liabilities by Finova. In addition, the Company retained $586.7 million of debt instruments of TriCon and received a note of an equal amount from Finova. The principal and interest payments on the retained debt match the principal and interest payments received on the note from Finova. At December 31, 1995, the remaining balance of a note receivable from Finova was $213.8 million. The Company recorded a pretax gain of $42.0 million as a result of this transaction. In the fourth quarter of 1994, the Company sold substantially all of the assets of a leasing subsidiary, Bell Atlantic Systems Leasing International, Inc., including the Company's 50% ownership interest in Pacific Atlantic Systems Leasing, Inc. This sale did not have a material effect on the Company's results of operations or financial position. OTHER In 1994, the Company recorded pretax charges aggregating $38.9 million in connection with the disposition of a subsidiary that sells and distributes liquefied petroleum gas and a foreign cellular operation.

Notes to Consolidated Financial Statements continued (6) DISPOSITION OF BUSINESSES COMPUTER MAINTENANCE In the fourth quarter of 1995, the Company sold its domestic computer maintenance subsidiary, Bell Atlantic Business Systems Services, Inc., and its interests in certain European computer maintenance operations for approximately $250 million in cash. The Company recorded a small gain as a result of this disposition. This disposition did not have a material effect on the Company's results of operations or financial position. LEASE FINANCING In the second quarter of 1994, the Company sold the assets of Bell Atlantic TriCon Leasing Corporation (TriCon), except for leveraged lease and project finance portfolios, to The Finova Group Inc. (Finova) (formerly GFC Financial Corporation). The sale price consisted of $344.2 million in cash and $835.9 million in notes receivable, plus the assumption of $81.8 million of liabilities by Finova. In addition, the Company retained $586.7 million of debt instruments of TriCon and received a note of an equal amount from Finova. The principal and interest payments on the retained debt match the principal and interest payments received on the note from Finova. At December 31, 1995, the remaining balance of a note receivable from Finova was $213.8 million. The Company recorded a pretax gain of $42.0 million as a result of this transaction. In the fourth quarter of 1994, the Company sold substantially all of the assets of a leasing subsidiary, Bell Atlantic Systems Leasing International, Inc., including the Company's 50% ownership interest in Pacific Atlantic Systems Leasing, Inc. This sale did not have a material effect on the Company's results of operations or financial position. OTHER In 1994, the Company recorded pretax charges aggregating $38.9 million in connection with the disposition of a subsidiary that sells and distributes liquefied petroleum gas and a foreign cellular operation.

(7) LEASING ARRANGEMENTS AS LESSOR In 1994, the Company sold substantially all of its lease financing business, except for leveraged lease and project finance portfolios (see Note 6). The Company is no longer providing new leasing services and during 1995 portions of the remaining portfolios were sold. Finance lease receivables, which are included in Other (current assets) and Other Assets (noncurrent assets) in the Consolidated Balance Sheets, consist of the following at December 31:
(Dollars in Millions) - -------------------------------------------------------------------------------1995 1994 - -------------------------------------------------------------------------------Leveraged leases $ 802.3 $ 896.0 Direct finance leases 27.3 29.1 --------------Total $ 829.6 $ 925.1 ======== ========

The components of the net investment in leveraged leases at December 31 are as follows:
(Dollars in Millions) - -------------------------------------------------------------------------------1995 1994 - --------------------------------------------------------------------------------

Minimum lease payments receivable Estimated residual value Unearned income Total

$

746.2 496.8 (440.7) ---------$ 802.3 ==========

$

852.3 548.7 (505.0) --------$ 896.0 =========

Minimum lease payments receivable are shown net of principal and interest on the associated nonrecourse debt. Accumulated deferred taxes arising from leveraged leases, which are included in deferred income taxes, amounted to $755.6 million and $779.5 million at December 31, 1995 and 1994, respectively. Future minimum lease payments to be received from noncancelable leases, net of nonrecourse loan payments related to leveraged leases, for the periods shown are as follows at December 31, 1995:
(Dollars in Millions) - -------------------------------------------------------------------------------Years Capital Leases Operating Leases - -------------------------------------------------------------------------------1996 $ 4.1 $ 34.9 1997 9.9 32.2 1998 14.5 26.6 1999 15.8 17.1 2000 16.7 11.7 Thereafter 723.0 15.5 ----------------Total $ 784.0 $ 138.0 ========= =========

31

Notes to Consolidated Financial Statements continued (8) LEASING ARRANGEMENTS AS LESSEE The Company leases certain facilities and equipment for use in its operations under both capital and operating leases. Plant, property and equipment included capital leases of $172.8 million and $171.6 million, and related accumulated amortization of $87.4 million and $82.8 million at December 31, 1995 and 1994, respectively. In 1995, 1994 and 1993, the Company incurred initial capital lease obligations of $14.0 million, $11.9 million and $13.6 million, respectively. Total rent expense amounted to $272.6 million in 1995, $285.5 million in 1994 and $307.8 million in 1993. At December 31, 1995, the aggregate minimum rental commitments under noncancelable leases for the periods shown are as follows:
(Dollars in Millions) ------------------------------------Years Capital Leases Operating Leases - -------------------------------------------------------------------------------1996 $ 26.7 $ 84.3 1997 23.5 79.2 1998 23.3 67.7 1999 19.0 57.9 2000 29.2 56.3 Thereafter 92.6 583.5 --------------------Total 214.3 $ 928.9 =========== Less imputed interest and executory costs Present value of net

94.6 -----------

Notes to Consolidated Financial Statements continued (8) LEASING ARRANGEMENTS AS LESSEE The Company leases certain facilities and equipment for use in its operations under both capital and operating leases. Plant, property and equipment included capital leases of $172.8 million and $171.6 million, and related accumulated amortization of $87.4 million and $82.8 million at December 31, 1995 and 1994, respectively. In 1995, 1994 and 1993, the Company incurred initial capital lease obligations of $14.0 million, $11.9 million and $13.6 million, respectively. Total rent expense amounted to $272.6 million in 1995, $285.5 million in 1994 and $307.8 million in 1993. At December 31, 1995, the aggregate minimum rental commitments under noncancelable leases for the periods shown are as follows:
(Dollars in Millions) ------------------------------------Years Capital Leases Operating Leases - -------------------------------------------------------------------------------1996 $ 26.7 $ 84.3 1997 23.5 79.2 1998 23.3 67.7 1999 19.0 57.9 2000 29.2 56.3 Thereafter 92.6 583.5 --------------------Total 214.3 $ 928.9 =========== Less imputed interest and executory costs Present value of net minimum lease payments Less current installments Long-term obligation at December 31, 1995

94.6 ----------119.7 12.0 ----------$ 107.7 ===========

As of December 31, 1995, the total minimum sublease rentals to be received in the future under noncancelable operating subleases was $81.4 million.

(9) DEBT DEBT MATURING WITHIN ONE YEAR Debt maturing within one year consists of the following at December 31:
(Dollars in Millions) ---------------------------1995 1994 - -----------------------------------------------------------------------------Notes payable: Bank loans $ 200.5 $ 666.9 Commercial paper 1,415.8 918.3 Long-term debt maturing within one year 313.9 502.4 ------------------Total $ 1,930.2 $ 2,087.6 ========== ========== Weighted average interest

rates for notes payable outstanding at year-end

5.8% ----------

6.0% ----------

Capital expenditures, primarily construction of telephone plant, are partially financed, pending long-term financing, through bank loans and the issuance of commercial paper payable within 12 months. At December 31, 1995, the Company had in excess of $2.2 billion of unused bank lines of credit. The availability of these lines, for which there are no formal compensating balances or commitment fee agreements, is at the discretion of each bank. 32

Notes to Consolidated Financial Statements continued Note 9 continued LONG-TERM DEBT Long-term debt consists of the following at December 31:
- ------------------------------------------------------------------------------------------------------Interest Rates Maturities 199 - ------------------------------------------------------------------------------------------------------Telephone subsidiaries' debentures 3.25% - 7.00% 1996 - 2025 $ 2,172. 7.125% - 7.75% 2002 - 2033 1,955. 7.85% - 8.75% 2019 - 2031 1,080. ----------------------------------------------------5,207. Notes payable 4.46% - 12.42% 1996 - 2005 916. Mortgage and installment notes 9.42% - 11.00% 1996 - 2003 11. Employee Stock Ownership Plan loans - senior notes 8.17% 2000 497. Capital lease obligations average rate 10.4% and 10.6% 119. Unamortized discount and premium, net (32. --------Total long-term debt, including current maturities 6,721. Less maturing within one year 313. --------Total long-term debt $ 6,407. =========

Maturities of long-term debt outstanding at December 31, 1995, excluding unamortized discount and premium and capital lease obligations, are: $301.9 million due in 1996, $279.3 million due in 1997, $397.4 million due in 1998, $294.4 million due in 1999, $318.9 million due in 2000, and $5,041.6 million thereafter. Telephone subsidiaries' debentures outstanding at December 31, 1995 include $1,572.0 million that are callable. The call prices range from 102.7% to 100.0% of face value, depending upon the remaining term to maturity of the issue. In addition, the telephone subsidiaries' debentures include $640.0 million that will become redeemable for a limited period at the option of the holders. Of this amount, $200.0 million becomes redeemable in 1996; $175.0 million becomes redeemable in 1997, 2000, or 2002; and $265.0 million becomes redeemable in 1999. The redemption prices will be 100.0% of face value plus accrued interest. Included in notes payable are medium-term notes issued by Bell Atlantic Financial Services, Inc. (FSI), a wholly owned subsidiary that provides financing for Bell Atlantic and certain of its subsidiaries. FSI debt securities (aggregating $731.3 million at December 31, 1995) have the benefit of a Support Agreement dated October 1, 1992 between Bell Atlantic and FSI, under which Bell Atlantic has committed to make payments of interest, premium, if any, and principal on the FSI debt in the event of FSI's failure to pay. The Support Agreement provides that the holders of FSI debt shall not have recourse to the stock or assets of Bell Atlantic's telephone

Notes to Consolidated Financial Statements continued Note 9 continued LONG-TERM DEBT Long-term debt consists of the following at December 31:
- ------------------------------------------------------------------------------------------------------Interest Rates Maturities 199 - ------------------------------------------------------------------------------------------------------Telephone subsidiaries' debentures 3.25% - 7.00% 1996 - 2025 $ 2,172. 7.125% - 7.75% 2002 - 2033 1,955. 7.85% - 8.75% 2019 - 2031 1,080. ----------------------------------------------------5,207. Notes payable 4.46% - 12.42% 1996 - 2005 916. Mortgage and installment notes 9.42% - 11.00% 1996 - 2003 11. Employee Stock Ownership Plan loans - senior notes 8.17% 2000 497. Capital lease obligations average rate 10.4% and 10.6% 119. Unamortized discount and premium, net (32. --------Total long-term debt, including current maturities 6,721. Less maturing within one year 313. --------Total long-term debt $ 6,407. =========

Maturities of long-term debt outstanding at December 31, 1995, excluding unamortized discount and premium and capital lease obligations, are: $301.9 million due in 1996, $279.3 million due in 1997, $397.4 million due in 1998, $294.4 million due in 1999, $318.9 million due in 2000, and $5,041.6 million thereafter. Telephone subsidiaries' debentures outstanding at December 31, 1995 include $1,572.0 million that are callable. The call prices range from 102.7% to 100.0% of face value, depending upon the remaining term to maturity of the issue. In addition, the telephone subsidiaries' debentures include $640.0 million that will become redeemable for a limited period at the option of the holders. Of this amount, $200.0 million becomes redeemable in 1996; $175.0 million becomes redeemable in 1997, 2000, or 2002; and $265.0 million becomes redeemable in 1999. The redemption prices will be 100.0% of face value plus accrued interest. Included in notes payable are medium-term notes issued by Bell Atlantic Financial Services, Inc. (FSI), a wholly owned subsidiary that provides financing for Bell Atlantic and certain of its subsidiaries. FSI debt securities (aggregating $731.3 million at December 31, 1995) have the benefit of a Support Agreement dated October 1, 1992 between Bell Atlantic and FSI, under which Bell Atlantic has committed to make payments of interest, premium, if any, and principal on the FSI debt in the event of FSI's failure to pay. The Support Agreement provides that the holders of FSI debt shall not have recourse to the stock or assets of Bell Atlantic's telephone subsidiaries. However, in addition to dividends paid to Bell Atlantic by any of its consolidated subsidiaries, certain assets of Bell Atlantic that are not subject to such exclusion are available as recourse to holders of FSI debt. The carrying value of the available assets reflected in the consolidated financial statements of Bell Atlantic was approximately $4.6 billion at December 31, 1995. See Note 14 for information on the Employee Stock Ownership Plan Loans. The Company has recorded extraordinary charges associated with the early extinguishment of debentures. These charges reduced net income by $3.5 million (net of an income tax benefit of $2.5 million) in 1995, $6.7 million (net of an income tax benefit of $3.6 million) in 1994, and $58.4 million (net of an income tax benefit of $36.2 million) in 1993. 33

Notes to Consolidated Financial Statements continued (10) PREFERRED STOCK OF SUBSIDIARY Bell Atlantic New Zealand Holdings, Inc. (BANZHI), a subsidiary of the Company, issued 850,000 shares of Series A Preferred Stock in 1994 at a price per share of $100 with a dividend rate of $7.08 per share per annum, and 600,000 shares of Series B Preferred Stock in 1995 at a price per share of $100 with a dividend rate of $5.80 per share per annum. The dividend rate on the Series B Preferred Stock may be adjusted if, under certain circumstances, legislation is enacted that reduces the dividends received deduction generally available to corporate shareholders for federal income tax purposes. Both series of preferred stock are subject to mandatory redemption on May 1, 2004 at a redemption price per share of $100, together with any accrued and unpaid dividends. BANZHI and another subsidiary of the Company indirectly own the Company's investment in Telecom Corporation of New Zealand Limited.

(11) FINANCIAL INSTRUMENTS DERIVATIVES The use of derivatives by the Company is limited to managing risk that could endanger the financing and operating flexibility of the Company, making cash flows more stable over the long run and achieving savings over traditional means of financing. Derivative agreements are tied to a specific liability or asset and hedge the related economic exposures. The use of these hedging agreements has not had a material impact on the Company's financial condition or results of operations. The Company does not hold derivatives for trading purposes. INTEREST RATE HEDGE AGREEMENTS The notional amounts outstanding, maturity dates, and weighted average receive and pay rates of interest rate hedge agreements are as follows at December 31:
(Dollars in Millions) ---------------------------------------------------Weighted Average Rate Notional --------------------Variable to Fixed: Amount Maturities Receive Pay - -----------------------------------------------------------------------------------------1995 $ 200.0 1999 - 2005 5.4% 5.7% 1994 $ 70.0 1995 - 1999 5.6% 5.4%

The notional amounts are used to calculate contractual payments to be exchanged and are not actually paid or received, nor are they a measure of the Company's exposure in the event of nonperformance by a counterparty. The Company also entered into forward interest rate hedge agreements with notional amounts of $1.9 million and $50.3 million at December 31, 1995 and 1994, respectively, in connection with a specific lease. Interest rate hedge agreements have not significantly impacted the Company's relative proportion of variable and fixed interest expense. FOREIGN EXCHANGE CONTRACTS Foreign exchange contracts have generally been limited to forward contracts for delivery or purchase of certain foreign currencies on a specified future date, usually within ninety days. At December 31, 1995, the Company had contracts for the sale of $.4 million and the purchase of $8.5 million of foreign currencies, compared to contracts for the sale of $27.6 million and the purchase of $5.6 million of foreign currencies at December 31, 1994. No position in any individual foreign currency exceeded $6.8 million and $16.1 million at December 31, 1995 and 1994, respectively. All of these contracts have maturities within ninety days of the respective year end.

Notes to Consolidated Financial Statements continued (10) PREFERRED STOCK OF SUBSIDIARY Bell Atlantic New Zealand Holdings, Inc. (BANZHI), a subsidiary of the Company, issued 850,000 shares of Series A Preferred Stock in 1994 at a price per share of $100 with a dividend rate of $7.08 per share per annum, and 600,000 shares of Series B Preferred Stock in 1995 at a price per share of $100 with a dividend rate of $5.80 per share per annum. The dividend rate on the Series B Preferred Stock may be adjusted if, under certain circumstances, legislation is enacted that reduces the dividends received deduction generally available to corporate shareholders for federal income tax purposes. Both series of preferred stock are subject to mandatory redemption on May 1, 2004 at a redemption price per share of $100, together with any accrued and unpaid dividends. BANZHI and another subsidiary of the Company indirectly own the Company's investment in Telecom Corporation of New Zealand Limited.

(11) FINANCIAL INSTRUMENTS DERIVATIVES The use of derivatives by the Company is limited to managing risk that could endanger the financing and operating flexibility of the Company, making cash flows more stable over the long run and achieving savings over traditional means of financing. Derivative agreements are tied to a specific liability or asset and hedge the related economic exposures. The use of these hedging agreements has not had a material impact on the Company's financial condition or results of operations. The Company does not hold derivatives for trading purposes. INTEREST RATE HEDGE AGREEMENTS The notional amounts outstanding, maturity dates, and weighted average receive and pay rates of interest rate hedge agreements are as follows at December 31:
(Dollars in Millions) ---------------------------------------------------Weighted Average Rate Notional --------------------Variable to Fixed: Amount Maturities Receive Pay - -----------------------------------------------------------------------------------------1995 $ 200.0 1999 - 2005 5.4% 5.7% 1994 $ 70.0 1995 - 1999 5.6% 5.4%

The notional amounts are used to calculate contractual payments to be exchanged and are not actually paid or received, nor are they a measure of the Company's exposure in the event of nonperformance by a counterparty. The Company also entered into forward interest rate hedge agreements with notional amounts of $1.9 million and $50.3 million at December 31, 1995 and 1994, respectively, in connection with a specific lease. Interest rate hedge agreements have not significantly impacted the Company's relative proportion of variable and fixed interest expense. FOREIGN EXCHANGE CONTRACTS Foreign exchange contracts have generally been limited to forward contracts for delivery or purchase of certain foreign currencies on a specified future date, usually within ninety days. At December 31, 1995, the Company had contracts for the sale of $.4 million and the purchase of $8.5 million of foreign currencies, compared to contracts for the sale of $27.6 million and the purchase of $5.6 million of foreign currencies at December 31, 1994. No position in any individual foreign currency exceeded $6.8 million and $16.1 million at December 31, 1995 and 1994, respectively. All of these contracts have maturities within ninety days of the respective year end. Market risk related to these contracts arises from fluctuations in the value of the underlying currencies. The

Company continually monitors the relationship between gains and losses recognized on forward exchange contracts and on the underlying transactions being hedged to ensure an adequate correlation exists and to mitigate this market risk. Foreign exchange gains and losses recognized on these contracts were not material to the Company's results of operations or financial condition and generally offset the foreign exchange gains and losses on the underlying hedged transactions. Deferred gains and losses from hedging identifiable foreign currency commitments were not material. At December 31, 1995, Bell Atlantic and its consolidated subsidiaries had no material foreign currency cash flow exposure resulting from monetary assets and liabilities, firm commitments, or highly anticipated cash flow exposures denominated in a currency other than the Company's functional currency. 34

Notes to Consolidated Financial Statements continued Note 11 continued The Company has not hedged its accounting translation exposure to foreign currency fluctuations relative to its net equity position in foreign subsidiaries since it does not represent actual cash flow exposure. The Company's net equity position in its principal unconsolidated foreign subsidiaries totaled $1,099.8 million and $1,335.7 million at December 31, 1995 and 1994, respectively. These subsidiaries have operations primarily in New Zealand and Mexico. Certain unconsolidated foreign subsidiaries accounted for using the equity method have net liabilities, primarily debt, denominated in a currency other than the investees' functional currency. The Company is subject to fluctuations in its equity income from these subsidiaries related to foreign currency gains and losses on such net liabilities. Foreign currency losses on such net liabilities included in equity income totaled $29.0 million and $21.5 million for the years ended December 31, 1995 and 1994, respectively. CONCENTRATIONS OF CREDIT RISK Financial instruments that subject the Company to concentrations of credit risk consist primarily of temporary cash investments, trade receivables, certain notes receivable, preferred stock, interest rate hedge agreements and foreign exchange forward contracts. The Company places its temporary cash investments with high-credit-quality financial institutions and, by policy, limits the amount of credit exposure to any one financial institution. Concentrations of credit risk with respect to trade receivables other than those from AT&T are limited due to the large number of customers in the Company's customer base. For the years ended December 31, 1995, 1994 and 1993, revenues generated from services provided to AT&T, primarily network access and billing and collection, were $1,316.4 million, $1,352.6 million and $1,368.4 million, respectively. At December 31, 1995 and 1994, Accounts receivable, net, included $125.3 million and $153.0 million, respectively, from AT&T. At December 31, 1995 and 1994, the Company had an uncollateralized note receivable from Finova of $213.8 million and $435.0 million, respectively, in connection with the disposition of TriCon (see Note 6). The counterparties to the interest rate hedge agreements and forward exchange agreements are all major financial institutions. The Company continually monitors its positions and the credit ratings of its counterparties, and limits the amount of contracts with any one party. The Company believes the risk of incurring losses related to credit risk is remote and any losses would not be material to results of operations or financial condition. FAIR VALUE OF FINANCIAL INSTRUMENTS

Notes to Consolidated Financial Statements continued Note 11 continued The Company has not hedged its accounting translation exposure to foreign currency fluctuations relative to its net equity position in foreign subsidiaries since it does not represent actual cash flow exposure. The Company's net equity position in its principal unconsolidated foreign subsidiaries totaled $1,099.8 million and $1,335.7 million at December 31, 1995 and 1994, respectively. These subsidiaries have operations primarily in New Zealand and Mexico. Certain unconsolidated foreign subsidiaries accounted for using the equity method have net liabilities, primarily debt, denominated in a currency other than the investees' functional currency. The Company is subject to fluctuations in its equity income from these subsidiaries related to foreign currency gains and losses on such net liabilities. Foreign currency losses on such net liabilities included in equity income totaled $29.0 million and $21.5 million for the years ended December 31, 1995 and 1994, respectively. CONCENTRATIONS OF CREDIT RISK Financial instruments that subject the Company to concentrations of credit risk consist primarily of temporary cash investments, trade receivables, certain notes receivable, preferred stock, interest rate hedge agreements and foreign exchange forward contracts. The Company places its temporary cash investments with high-credit-quality financial institutions and, by policy, limits the amount of credit exposure to any one financial institution. Concentrations of credit risk with respect to trade receivables other than those from AT&T are limited due to the large number of customers in the Company's customer base. For the years ended December 31, 1995, 1994 and 1993, revenues generated from services provided to AT&T, primarily network access and billing and collection, were $1,316.4 million, $1,352.6 million and $1,368.4 million, respectively. At December 31, 1995 and 1994, Accounts receivable, net, included $125.3 million and $153.0 million, respectively, from AT&T. At December 31, 1995 and 1994, the Company had an uncollateralized note receivable from Finova of $213.8 million and $435.0 million, respectively, in connection with the disposition of TriCon (see Note 6). The counterparties to the interest rate hedge agreements and forward exchange agreements are all major financial institutions. The Company continually monitors its positions and the credit ratings of its counterparties, and limits the amount of contracts with any one party. The Company believes the risk of incurring losses related to credit risk is remote and any losses would not be material to results of operations or financial condition. FAIR VALUE OF FINANCIAL INSTRUMENTS The following methods and assumptions were used to estimate the fair value of each class of financial instruments. Cash and Cash Equivalents and Forward Exchange Contracts The carrying amounts approximate fair value. Debt Fair value is estimated based on the quoted market prices for the same or similar issues or on the net present value of the expected future cash flows using current interest rates. Preferred Stock and Notes Receivable Fair value is based on the present value of the expected future cash flows using current interest rates or on quoted

market prices for similar instruments, if available. Interest Rate Hedge Agreements The fair value of interest rate hedge agreements is based on the estimated amount the Company would pay or receive to terminate the agreements, taking into account current interest rates and the creditworthiness of the counterparties. The estimated fair values of the Company's financial instruments are as follows at December 31:
- ------------------------------------------------------------------------------------------------------1995 -------------------------Carrying Fair Car Amount Value A - ------------------------------------------------------------------------------------------------------Debt/*/ $ 8,249.8 $ 8,604.3 $ 8, Preferred stock and notes receivable, net 315.6 318.4 Unrealized (loss) gain on interest rate hedge agreements (3.8)

* Debt includes Long-term debt and Debt maturing within one year, but excludes capital lease obligations and unamortized discount and premium. 35

Notes to Consolidated Financial Statements continued (12) SHAREOWNERS' INVESTMENT
Common Stock Common Stock Issu

(Dollars in Millions, Shares (in Shares (in Except Per Share Amounts) Thousands) Amount Thousands) Am - ------------------------------------------------------------------------------------------------------Balance at December 31, 1992 434,155 $ 434.2 186 $ Net income Dividends declared ($2.68 per share) Common stock issued: Employee plans 844 .7 Shareowner plans 200 .2 Acquisition agreements 47 .1 (44) Former Metro Mobile CTS, Inc. shareowners 884 .9 Foreign currency translation adjustment, net of tax benefit of $6.3 Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs - ------------------------------------------------------------------------------------------------------Balance at December 31, 1993 436,130 436.1 142 Loss Dividends declared ($2.76 per share) Purchase of common stock Common stock issued: Employee plans 230 .2 Acquisition agreements 46 .1 (49) Foreign currency translation adjustment, net of tax benefit of $.9 Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs - ------------------------------------------------------------------------------------------------------Balance at December 31, 1994 Net income Dividends declared ($2.80 per share) Purchase of common stock Common stock issued: 436,406 436.4 93

Notes to Consolidated Financial Statements continued (12) SHAREOWNERS' INVESTMENT
Common Stock Common Stock Issu

(Dollars in Millions, Shares (in Shares (in Except Per Share Amounts) Thousands) Amount Thousands) Am - ------------------------------------------------------------------------------------------------------Balance at December 31, 1992 434,155 $ 434.2 186 $ Net income Dividends declared ($2.68 per share) Common stock issued: Employee plans 844 .7 Shareowner plans 200 .2 Acquisition agreements 47 .1 (44) Former Metro Mobile CTS, Inc. shareowners 884 .9 Foreign currency translation adjustment, net of tax benefit of $6.3 Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs - ------------------------------------------------------------------------------------------------------Balance at December 31, 1993 436,130 436.1 142 Loss Dividends declared ($2.76 per share) Purchase of common stock Common stock issued: Employee plans 230 .2 Acquisition agreements 46 .1 (49) Foreign currency translation adjustment, net of tax benefit of $.9 Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs - ------------------------------------------------------------------------------------------------------Balance at December 31, 1994 436,406 436.4 93 Net income Dividends declared ($2.80 per share) Purchase of common stock Common stock issued: Employee plans 1,258 1.3 Shareowner plans 8 Acquisition agreements 93 .1 (93) Foreign currency translation adjustment, net of tax benefit of $1.1 Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs - ------------------------------------------------------------------------------------------------------Balance at December 31, 1995 437,765 $ 437.8 $ =========================================================================================================

Foreign Currency Treasur (Dollars in Millions, Reinvested Translation Shares (in Except Per Share Amounts) Earnings Adjustment Thousands) - ------------------------------------------------------------------------------------------------------Balance at December 31, 1992 $ 2,853.4 $ (140.1) 186 $ Net income 1,403.4 Dividends declared ($2.68 per share) (1,166.6) Common stock issued: Employee plans (8.2) (66) Shareowner plans Acquisition agreements (70) Former Metro Mobile CTS, Inc. shareowners Foreign currency translation adjustment, net of tax benefit of $6.3 56.2 Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs 11.6 - -------------------------------------------------------------------------------------------------------

Balance at December 31, 1993 3,093.6 (83.9) 50 Loss (754.8) Dividends declared ($2.76 per share) (1,203.9) Purchase of common stock 209 Common stock issued: Employee plans (.9) (13) Acquisition agreements (26) Foreign currency translation adjustment, net of tax benefit of $.9 (246.9) Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs 10.4 - ------------------------------------------------------------------------------------------------------Balance at December 31, 1994 1,144.4 (330.8) 220 Net income 1,858.3 Dividends declared ($2.80 per share) (1,223.4) Purchase of common stock 211 Common stock issued: Employee plans (11.8) (43) Shareowner plans (234) Acquisition agreements (91) Foreign currency translation adjustment, net of tax benefit of $1.1 (185.1) Reduction of ESOP obligations Tax benefit of dividends paid to ESOPs 9.0 - ------------------------------------------------------------------------------------------------------Balance at December 31, 1995 $ 1,776.5 $ (515.9) 63 $ =========================================================================================================

Bell Atlantic Corporation is authorized to issue up to 12.5 million shares each of Preferred and Preference stock and 1.5 billion shares of common stock. A cellular telephone acquisition closed during 1992 required the Company to deliver shares of its common stock in 1993, 1994 and 1995. In 1993, the Company issued 883,832 shares of common stock to settle certain litigation arising from the merger in 1992 with Metro Mobile CTS, Inc., which was accounted for as a pooling of interests. This distribution represents additional merger consideration to the former Metro Mobile shareholders and was reflected as a credit to the common stock account with a corresponding charge to contributed capital. On January 23, 1996, the Board of Directors adopted a resolution ordering the redemption of all Rights granted under the Company's Shareholder Rights Plan, approved by the Board in 1989. Shareholders of record as of April 10, 1996 will be entitled to receive the redemption price of $.01 per Right ($.005 per share as a result of a two-for-one stock split declared on March 16, 1990) on May 1, 1996. 36

Notes to Consolidated Financial Statements continued

Notes to Consolidated Financial Statements continued (13) STOCK INCENTIVE PLANS Under the stock option and performance share components of the Bell Atlantic Stock Incentive Plan, a total of 25,000,000 shares of common stock may be distributed upon the exercise of stock options under the 1985 Incentive Stock Option Plan (the "ISO Plan"), and as a result of awards under the Performance Share Plan (the "Shares Plan"). Under the ISO Plan, key employees may be granted incentive stock options, and/or nonqualified stock options, to purchase shares of Bell Atlantic's common stock at prices not less than the fair market value of the stock on the date of the option grant. Under the ISO Plan, certain key employees may receive reload options upon tendering shares of Bell Atlantic stock to exercise options. In 1991 and prior years, stock appreciation rights ("SARs") were granted to certain officers in tandem with stock options under the ISO Plan. No SARs have been granted since 1991. In 1994, the Bell Atlantic "Options Plus" Plan was adopted. Nonqualified stock options may be granted under the plan to approximately 800 managers below the rank of officer, in place of a portion of each such manager's annual cash bonus incentive. The Shares Plan provides for the granting of awards to certain key employees, in the form of shares of Bell Atlantic common stock. A key employee may receive the distributions of shares at the end of the applicable performance measurement period or the employee may elect to defer the distribution of the awards for one or more years. Awards are based on the total return of Bell Atlantic stock in comparison to the total return on the stock of a number of other telecommunications companies. Authority to make new grants under the Shares Plan expired in December 1994. Final awards were distributed in January 1996. Certain key employees receive awards under the Company's Short Term Incentive Plan ("STIP"). Under the STIP, 80% of the amount of the awards is payable in cash and 20% is deferred for future distribution in the form of Bell Atlantic common stock. Activity associated with the deferred stock portion of the STIP awards is included with the Shares Plan activity in the Performance Share Awards section below. Stock options, SARs and performance share awards under plans maintained by Bell Atlantic and its subsidiaries are as follows:
Weighted Average Price of Stock Pe Stock Options SARs Options Sha - ------------------------------------------------------------------------------------------------------Outstanding at December 31, 1992 2,412,202 15,402 $ 48.68 1 Granted 930,219 53.45 Exercised/Distributed (664,753) 47.77 Canceled (95,100) (2,742) 52.08 ------------------Outstanding at December 31, 1993 2,582,568 12,660 50.50 Granted Exercised/Distributed Canceled Outstanding at December 31, 1994 Granted Exercised/Distributed Canceled Outstanding at December 31, 1995 5,838,885 (177,796) (326,323) -----------7,917,334 3,798,970 (1,332,155) (350,609) -----------10,033,540 ============ ------12,660 (6,160) -----6,500 ====== 54.75 46.86 54.69 --53.55 51.06 52.27 52.53 --52.81 ===

At December 31, 1995, stock options to purchase 6,258,259 shares of common stock were exercisable under the ISO Plan, and 274,920 shares were exercisable under Options Plus. A total of 10,879,082 and 14,003,993

shares of common stock were available for the granting of stock options under the ISO Plan and for distributions of shares under the Shares Plan, as of December 31, 1995 and 1994, respectively. There is no established limit on the number of options granted pursuant to Options Plus. At December 31, 1995, employees had deferred receipt of 309,842 shares which had previously been awarded under the STIP and Shares Plan. 37

Notes to Consolidated Financial Statements continued (14) EMPLOYEE BENEFITS PENSION PLANS Substantially all of the Company's management and associate employees are covered under noncontributory defined benefit pension plans. The pension benefit formula is based on a flat dollar amount per year of service according to job classification under the associate plan. The pension benefit formula for plans covering management employees in 1995 and prior years is based on a stated percentage of adjusted career average earnings. The Company's objective in funding the plans is to accumulate funds at a relatively stable level over participants' working lives so that benefits are fully funded at retirement. Plan assets consist principally of investments in domestic and foreign corporate equity securities, U.S. and foreign government and corporate debt securities, and real estate. Effective January 1, 1996, the plan covering management employees was converted to a cash balance plan. Under the cash balance plan, pension benefits are determined by a combination of compensation credits based on age and service and individual account-based interest credits. Each management employee's opening account balance is based on accrued pension benefits as of December 31, 1995, and converted to a lump-sum amount determined under the prior plan's provisions. The lump-sum value is multiplied by a transition factor, based on age and service, to arrive at the opening balance. Pension cost is composed of the following:
(Dollars in Millions) - ------------------------------------------------------------------------------------------------------Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------------------Benefits earned during the year $ 162.6 $ 196.4 $ 162.7 Interest on projected benefit obligation 820.8 821.1 818.9 Actual return on plan assets (2,559.9) (27.6) (1,731.7) Deferral of difference between actual and assumed returned on plan assets 1,703.0 (817.7) 898.3 Net amortization (64.8) (24.2) .9 ---------------------------------Pension cost $ 61.7 $ 148.0 $ 149.1 ============ ============ ============

The reduction in 1995 pension cost is principally due to an increase in the discount rate from 7.25% at December 31, 1993 to 8.25% at December 31, 1994, and plan changes. 38

Notes to Consolidated Financial Statements continued Note 14 continued The following table sets forth the pension plans' funded status and amounts recognized in the Company's Consolidated Balance Sheets as of December 31:

Notes to Consolidated Financial Statements continued (14) EMPLOYEE BENEFITS PENSION PLANS Substantially all of the Company's management and associate employees are covered under noncontributory defined benefit pension plans. The pension benefit formula is based on a flat dollar amount per year of service according to job classification under the associate plan. The pension benefit formula for plans covering management employees in 1995 and prior years is based on a stated percentage of adjusted career average earnings. The Company's objective in funding the plans is to accumulate funds at a relatively stable level over participants' working lives so that benefits are fully funded at retirement. Plan assets consist principally of investments in domestic and foreign corporate equity securities, U.S. and foreign government and corporate debt securities, and real estate. Effective January 1, 1996, the plan covering management employees was converted to a cash balance plan. Under the cash balance plan, pension benefits are determined by a combination of compensation credits based on age and service and individual account-based interest credits. Each management employee's opening account balance is based on accrued pension benefits as of December 31, 1995, and converted to a lump-sum amount determined under the prior plan's provisions. The lump-sum value is multiplied by a transition factor, based on age and service, to arrive at the opening balance. Pension cost is composed of the following:
(Dollars in Millions) - ------------------------------------------------------------------------------------------------------Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------------------Benefits earned during the year $ 162.6 $ 196.4 $ 162.7 Interest on projected benefit obligation 820.8 821.1 818.9 Actual return on plan assets (2,559.9) (27.6) (1,731.7) Deferral of difference between actual and assumed returned on plan assets 1,703.0 (817.7) 898.3 Net amortization (64.8) (24.2) .9 ---------------------------------Pension cost $ 61.7 $ 148.0 $ 149.1 ============ ============ ============

The reduction in 1995 pension cost is principally due to an increase in the discount rate from 7.25% at December 31, 1993 to 8.25% at December 31, 1994, and plan changes. 38

Notes to Consolidated Financial Statements continued Note 14 continued The following table sets forth the pension plans' funded status and amounts recognized in the Company's Consolidated Balance Sheets as of December 31:
(Dollars in M -----------------------1995 - ------------------------------------------------------------------------------------------------------Actuarial present value of benefit obligations: Benefits based on service to date and present salary levels Vested $ 8,747.2 $ Nonvested 1,847.1 ---------------

Notes to Consolidated Financial Statements continued Note 14 continued The following table sets forth the pension plans' funded status and amounts recognized in the Company's Consolidated Balance Sheets as of December 31:
(Dollars in M -----------------------1995 - ------------------------------------------------------------------------------------------------------Actuarial present value of benefit obligations: Benefits based on service to date and present salary levels Vested $ 8,747.2 $ Nonvested 1,847.1 --------------Accumulated benefit obligation 10,594.3 Additional benefits related to estimated future salary levels 708.9 --------------Projected benefit obligation 11,303.2 --------------Fair value of plan assets 13,218.9 --------------Plan assets in excess of projected benefit obligation (1,915.7) Unrecognized net gain 2,565.8 Unamortized prior service cost 3.4 Unamortized net transition asset 173.6 Additional minimum liability for nonqualified plans 27.7 --------------Accrued pension obligation $ 854.8 $ ============ ====

The significant assumptions used for the pension measurements were as follows at December 31:
1995 1994 1993 - ------------------------------------------------------------------------------------Discount rate 7.25% 8.25% 7.25% Rate of future increases in compensation levels 4.75% 5.25% 5.25% -------------

The expected long-term rate of return on plan assets was 8.25% for 1995, 1994 and 1993. Pension benefits for approximately 70% of employees are subject to collective bargaining. Modifications in pension benefits have been bargained from time to time. Additionally, the Company has amended the benefit formula under pension plans maintained for its management employees. Substantive commitments for future amendments to the Company's pension plans have been reflected in determining the Company's pension cost. The actuarial assumptions used to determine pension cost are based on financial market interest rates, past experience, and management's best estimate of future benefit changes and economic conditions. Changes in these assumptions may impact future pension cost levels and benefit obligations. POSTRETIREMENT BENEFITS OTHER THAN PENSIONS Substantially all of the Company's management and associate employees are covered under postretirement health and life insurance benefit plans. The determination of benefit cost for postretirement health benefit plans is based on comprehensive medical and dental benefit plan provisions. The postretirement life insurance benefit formula used in the determination of postretirement benefit cost is primarily based on annual basic pay at retirement. The Company funds the postretirement health and life insurance benefits of current and future retirees. Plan assets consist principally of investments in domestic and foreign corporate equity securities, and U.S. Government and corporate debt securities. 39

Notes to Consolidated Financial Statements continued Note 14 continued Postretirement benefit cost is composed of the following:
(Dollars in Millions) - -------------------------------------------------------------------------------------------------Years Ended December 31, 1995 1994 1993 - -------------------------------------------------------------------------------------------------Benefits earned during the year $ 63.8 $ 81.6 $ 73.3 Interest on accumulated postretirement benefit obligation 297.6 298.0 302.1 Actual return on plan assets (330.7) 12.4 (163.7) Net amortization and deferral 237.6 (89.0) 102.7 ---------------------------Postretirement benefit cost $ 268.3 $ 303.0 $ 314.4 ========== ========== ==========

Postretirement benefit cost decreased in 1995 principally as a result of an increase in the discount rate from 7.25% at December 31, 1993 to 8.25% at December 31, 1994, and the effect of favorable plan experience. The following table sets forth the postretirement benefit plans' funded status and the amounts recognized in the Company's Consolidated Balance Sheets as of December 31:
(Dollars in Million - ------------------------------------------------------------------------------------------------------1995 19 - ------------------------------------------------------------------------------------------------------Accumulated postretirement benefit obligation attributable to: Retirees $ 2,503.4 $ 2,143 Fully eligible plan participants 368.9 313 Other active plan participants 1,384.7 1,340 --------------------Total accumulated postretirement benefit obligation 4,257.0 3,797 --------------------Fair value of plan assets 1,632.5 1,279 --------------------Accumulated postretirement benefit obligation in excess of plan assets 2,624.5 2,518 Unrecognized net gain 145.7 214 Unamortized prior service cost (56.7) (60 --------------------Accrued postretirement benefit obligation $ 2,713.5 $ 2,672 ============ ========== Total accumulated postretirement benefit obligation by plan: Health $ 3,747.2 $ 3,367 Life insurance 509.8 429 --------------------$ 4,257.0 $ 3,797 ============ ========== Fair value of plan assets by plan: Health $ 932.1 $ 705 Life insurance 700.4 574 --------------------$ 1,632.5 $ 1,279 ============ ==========

Assumptions used in the actuarial computations for postretirement benefits are as follows at December 31:
1995 1994 1993 - ------------------------------------------------------------------------------------------------Discount rate 7.25% 8.25% 7.25% Rate of future increases in compensation levels 4.75 5.25 5.25 Medical cost trend rate:

Year ending Ultimate (year 2003) Dental cost trend rate

11.00 5.00 4.00 -------

12.00 5.00 4.00 -------

13.00 5.00 4.00 -------

40

Notes to Consolidated Financial Statements continued Note 14 continued The expected long-term rate of return on plan assets was 8.25% for 1995, 1994 and 1993. A one-percentage-point increase in the assumed health care cost trend rates for each future year would have increased the aggregate of the service and interest cost components of 1995 net periodic postretirement benefit cost by $46.6 million and would have increased the accumulated postretirement benefit obligation as of December 31, 1995 by $453.8 million. Postretirement benefits other than pensions for approximately 70% of employees are subject to collective bargaining agreements and have been modified from time to time. The Company also has periodically modified benefits under plans maintained for its management employees. Substantive commitments for future amendments to the Company's postretirement benefit plans have been reflected in determining the Company's postretirement benefit cost. The actuarial assumptions used to determine postretirement benefit cost are based on financial market interest rates, past experience, and management's best estimate of future benefit changes and economic conditions. Changes in these assumptions may impact future postretirement benefit cost levels and benefit obligations. POSTEMPLOYMENT BENEFITS Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits" (Statement No. 112). The cumulative effect at January 1, 1993 of adopting Statement No. 112 reduced net income by $85.0 million, net of a deferred income tax benefit of $50.6 million. In the third quarter of 1994, the Company recorded a pretax charge of $161.9 million to recognize benefit costs for the separation of employees who are entitled to benefits under preexisting separation pay plans. The charge, which was actuarially determined, represents benefits earned through July 1, 1994 for employees who are expected to receive separation payments in the future. SAVINGS PLANS AND EMPLOYEE STOCK OWNERSHIP PLANS The Company has established savings plans to provide opportunities for eligible employees to save for retirement on a tax-deferred basis and encourage employees to acquire and maintain an equity interest in the Company. Under these plans, the Company matches a certain percentage of eligible employee contributions with shares of the Company's common stock. Two leveraged employee stock ownership plans (ESOPs) were established to purchase the Company's common stock and fund the Company's matching contribution. Common stock is allocated from the ESOP trusts based on the proportion of principal and interest paid on ESOP debt in a year to the remaining principal and interest due over the term of the debt. At December 31, 1995, the number of unallocated and allocated shares of common stock was 8,367,068 and 8,653,180, respectively. The ESOP trusts were funded by the issuance of $790.0 million in ESOP Senior Notes. Effective January 1, 1993, the annual interest rate on the ESOP Senior Notes was reduced from 8.25% to 8.17%. The ESOP Senior Notes are payable in semiannual installments, which began on January 1, 1990 and end in the year 2000. The ESOP trusts repay the notes, including interest, with funds from the Company's contributions to the ESOP trusts, as well as dividends received on unallocated shares of common stock and interest earned on the cash balances of the ESOP trusts.

Notes to Consolidated Financial Statements continued Note 14 continued The expected long-term rate of return on plan assets was 8.25% for 1995, 1994 and 1993. A one-percentage-point increase in the assumed health care cost trend rates for each future year would have increased the aggregate of the service and interest cost components of 1995 net periodic postretirement benefit cost by $46.6 million and would have increased the accumulated postretirement benefit obligation as of December 31, 1995 by $453.8 million. Postretirement benefits other than pensions for approximately 70% of employees are subject to collective bargaining agreements and have been modified from time to time. The Company also has periodically modified benefits under plans maintained for its management employees. Substantive commitments for future amendments to the Company's postretirement benefit plans have been reflected in determining the Company's postretirement benefit cost. The actuarial assumptions used to determine postretirement benefit cost are based on financial market interest rates, past experience, and management's best estimate of future benefit changes and economic conditions. Changes in these assumptions may impact future postretirement benefit cost levels and benefit obligations. POSTEMPLOYMENT BENEFITS Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 112, "Employers' Accounting for Postemployment Benefits" (Statement No. 112). The cumulative effect at January 1, 1993 of adopting Statement No. 112 reduced net income by $85.0 million, net of a deferred income tax benefit of $50.6 million. In the third quarter of 1994, the Company recorded a pretax charge of $161.9 million to recognize benefit costs for the separation of employees who are entitled to benefits under preexisting separation pay plans. The charge, which was actuarially determined, represents benefits earned through July 1, 1994 for employees who are expected to receive separation payments in the future. SAVINGS PLANS AND EMPLOYEE STOCK OWNERSHIP PLANS The Company has established savings plans to provide opportunities for eligible employees to save for retirement on a tax-deferred basis and encourage employees to acquire and maintain an equity interest in the Company. Under these plans, the Company matches a certain percentage of eligible employee contributions with shares of the Company's common stock. Two leveraged employee stock ownership plans (ESOPs) were established to purchase the Company's common stock and fund the Company's matching contribution. Common stock is allocated from the ESOP trusts based on the proportion of principal and interest paid on ESOP debt in a year to the remaining principal and interest due over the term of the debt. At December 31, 1995, the number of unallocated and allocated shares of common stock was 8,367,068 and 8,653,180, respectively. The ESOP trusts were funded by the issuance of $790.0 million in ESOP Senior Notes. Effective January 1, 1993, the annual interest rate on the ESOP Senior Notes was reduced from 8.25% to 8.17%. The ESOP Senior Notes are payable in semiannual installments, which began on January 1, 1990 and end in the year 2000. The ESOP trusts repay the notes, including interest, with funds from the Company's contributions to the ESOP trusts, as well as dividends received on unallocated shares of common stock and interest earned on the cash balances of the ESOP trusts. Total ESOP cost and trust activity consist of the following:
(Dollars in Millions) - ------------------------------------------------------------------------------------------------------Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------------------Compensation $ 68.0 $ 48.1 $ 45.0 Interest incurred 48.6 48.0 52.9 Dividends (26.0) (29.8) (33.3

Other trust earnings and expenses, net Net leveraged ESOP cost Additional ESOP cost Total ESOP cost Dividends received for debt service Total company contributions to trusts

(.5) ---------90.1 (3.2) ---------$ 86.9 ========== $ 43.8 ========== $ 99.1 ==========

(.3) ---------66.0 7.1 ---------$ 73.1 ========== $ 44.1 ========== $ 78.4 ==========

.1 ---------64.7 .9 ---------$ 65.6 ========== $ 43.4 ========== $ 80.3 ==========

41

Notes to Consolidated Financial Statements continued (15) INCOME TAXES Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" (Statement No. 109). As of January 1, 1993, the Company recorded a tax benefit of $65.2 million, which has been reflected in the Consolidated Statement of Operations as the cumulative effect of a change in accounting principle. This tax benefit is principally attributable to net operating loss (NOL) carryforwards of the Metro Mobile CTS, Inc. (Metro Mobile) subsidiaries that the Company expected to realize based on projections of future taxable income. Upon adoption of Statement No. 109, the effects of required adjustments to deferred tax balances of the telephone subsidiaries, which would be recognized in the future for regulatory purposes, were deferred on the balance sheet as regulatory assets and liabilities, in accordance with Statement No. 71. At January 1, 1993, the telephone subsidiaries recorded income tax-related regulatory assets totaling $976.6 million in Other Assets and income tax-related regulatory liabilities totaling $1,043.8 million in Deferred Credits and Other Liabilities-Other. During 1993, these regulatory assets were increased by $23.9 million and regulatory liabilities were reduced by $94.1 million for the effect of the federal income tax rate increase from 34% to 35%, effective January 1, 1993. The income tax-related regulatory assets and liabilities were eliminated as a result of the discontinued application of Statement No. 71, effective August 1, 1994 (see Note 4). The components of income tax expense from continuing operations are as follows:
(Dollars in Millions) ----------------------------------------------------------Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------------------Current: Federal $ 1,093.0 $ 1,010.8 $ 814.0 State and local 179.4 194.0 150.0 ------------------------------Total 1,272.4 1,204.8 964.0 ------------------------------Deferred: Federal (79.7) (278.0) (107.9) State and local (15.7) 7.5 2.1 ------------------------------Total (95.4) (270.5) (105.8) ------------------------------1,177.0 934.3 858.2 ------------------------------Investment tax credits (29.4) (49.4) (66.2) ------------------------------Total income tax expense $ 1,147.6 $ 884.9 $ 792.0 =========== =========== ===========

Changes in federal and state income tax rates in 1995, 1994 and 1993 did not have a material impact on income

Notes to Consolidated Financial Statements continued (15) INCOME TAXES Effective January 1, 1993, the Company adopted Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" (Statement No. 109). As of January 1, 1993, the Company recorded a tax benefit of $65.2 million, which has been reflected in the Consolidated Statement of Operations as the cumulative effect of a change in accounting principle. This tax benefit is principally attributable to net operating loss (NOL) carryforwards of the Metro Mobile CTS, Inc. (Metro Mobile) subsidiaries that the Company expected to realize based on projections of future taxable income. Upon adoption of Statement No. 109, the effects of required adjustments to deferred tax balances of the telephone subsidiaries, which would be recognized in the future for regulatory purposes, were deferred on the balance sheet as regulatory assets and liabilities, in accordance with Statement No. 71. At January 1, 1993, the telephone subsidiaries recorded income tax-related regulatory assets totaling $976.6 million in Other Assets and income tax-related regulatory liabilities totaling $1,043.8 million in Deferred Credits and Other Liabilities-Other. During 1993, these regulatory assets were increased by $23.9 million and regulatory liabilities were reduced by $94.1 million for the effect of the federal income tax rate increase from 34% to 35%, effective January 1, 1993. The income tax-related regulatory assets and liabilities were eliminated as a result of the discontinued application of Statement No. 71, effective August 1, 1994 (see Note 4). The components of income tax expense from continuing operations are as follows:
(Dollars in Millions) ----------------------------------------------------------Years Ended December 31, 1995 1994 1993 - ------------------------------------------------------------------------------------------------------Current: Federal $ 1,093.0 $ 1,010.8 $ 814.0 State and local 179.4 194.0 150.0 ------------------------------Total 1,272.4 1,204.8 964.0 ------------------------------Deferred: Federal (79.7) (278.0) (107.9) State and local (15.7) 7.5 2.1 ------------------------------Total (95.4) (270.5) (105.8) ------------------------------1,177.0 934.3 858.2 ------------------------------Investment tax credits (29.4) (49.4) (66.2) ------------------------------Total income tax expense $ 1,147.6 $ 884.9 $ 792.0 =========== =========== ===========

Changes in federal and state income tax rates in 1995, 1994 and 1993 did not have a material impact on income tax expense. 42

Notes to Consolidated Financial Statements continued Note 15 continued The provision for income taxes varies from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The difference is attributable to the following factors:

Notes to Consolidated Financial Statements continued Note 15 continued The provision for income taxes varies from the amount computed by applying the statutory federal income tax rate to income before provision for income taxes. The difference is attributable to the following factors:
Years Ended December 31, 1995 1994 1 - ------------------------------------------------------------------------------------------------------Statutory federal income tax rate 35.0% 35.0% 3 Investment tax credits (.6) (2.2) ( State income taxes, net of federal tax benefits 3.4 5.4 Benefit of rate differential applied to reversing timing differences (1.0) ( Other, net .3 1.5 --------Effective income tax rate 38.1% 38.7% 3 ===== ===== =

Significant components of deferred tax liabilities (assets) are as follows at December 31:
(Dollars in Millions) --------------------------------------1995 1994 - -----------------------------------------------------------------------------------------------Deferred tax liabilities: Depreciation $ 2,019.4 $ 2,171.6 Leasing activities 774.1 869.8 Other 465.7 418.9 ------------------------3,259.2 3,460.3 ------------------------Deferred tax assets: Employee benefits (1,593.7) (1,553.1) Investment tax credits (56.6) (69.3) Net operating loss carryforwards: Federal (105.8) State (12.0) (22.5) Advance payments (48.5) (51.5) Other (520.1) (548.6) ------------------------(2,230.9) (2,350.8) ------------------------Valuation allowance 9.6 22.4 ------------------------Net deferred tax liability $ 1,037.9 $ 1,131.9 ============= =============

Deferred tax assets include approximately $1,108 million and $1,083 million at December 31, 1995 and 1994, respectively, related to postretirement benefit costs recognized in accordance with Statement of Financial Accounting Standards No. 106, "Accounting for Postretirement Benefits Other Than Pensions." This deferred tax asset will gradually be realized over the estimated lives of current retirees and employees. In 1995, the Company utilized the remaining federal NOL carryforwards of the Metro Mobile subsidiaries as a result of the sale of certain cellular properties (see Note 2). At December 31, 1995, NOL carryforwards for state income tax purposes were $188.5 million (excluding amounts attributable to leveraged leases) and expire from 1996 to 2009. Based on projections of future taxable income, the Company expects to realize future tax benefits of state NOL carryforwards in the amount of $7.7 million. The valuation allowance required under Statement No. 109 primarily represents tax benefits of certain state NOL carryforwards and other deferred state tax assets, which may expire unutilized. During 1995, the valuation

allowance decreased $12.8 million as a result of the disposition of certain nonregulated subsidiaries and the writeoff of state NOLs that will expire prior to utilization. 43

Notes to Consolidated Financial Statements continued (16) ADDITIONAL FINANCIAL INFORMATION
(Dollars in Millions) - ------------------------------------------------------------------------------------------December 31, 1995 1994 - ------------------------------------------------------------------------------------------CONSOLIDATED BALANCE SHEETS: Accounts payable and accrued liabilities: Accounts payable $ 1,668.9 $ 1,595.2 Accrued expenses 513.1 625.0 Accrued vacation pay 242.4 251.5 Accrued taxes 195.9 137.2 Interest payable 103.2 128.5 --------------------$ 2,723.5 $ 2,737.4 =========== =========== Other current liabilities: Advance billings and customer deposits $ 412.9 $ 450.7 Dividend payable 306.4 301.0 --------------------$ 719.3 $ 751.7 =========== ===========

(Do - ------------------------------------------------------------------------------------------------------Years Ended December 31, 1995 1994 - ------------------------------------------------------------------------------------------------------CONSOLIDATED STATEMENTS OF CASH FLOWS: Cash paid during the year for: Interest, net of amounts capitalized $ 564.1 $ 569.1 Income taxes, net of amounts refunded 1,182.1 1,283.7 Noncash investing and financing activities: Conversion of accounts receivable to note receivable 3.4 Note receivable on sale of business 435.0 Note receivable on sale of asset 39.0 Acquisition of plant under capital leases 14.0 11.9 Common stock issued for incentive plans 4.0 5.3 Common stock issued for acquisitions 5.5 1.5 Contribution of net assets to joint ventures: Bell Atlantic NYNEX Mobile 1,178.1 Other 16.4 1.6 CONSOLIDATED STATEMENTS OF OPERATIONS: Interest expense incurred, net of amounts capitalized Capitalized interest

571.1 64.4 ------------

624.6 19.1 ------------

Interest expense incurred includes $10.1 million in 1995, $42.5 million in 1994 and $107.5 million in 1993 related to the Company's lease financing business. Such interest expense is classified as other operating expenses. Income taxes, as well as payroll, gross receipts, property, capital stock and other taxes, totaled $2,026.8 million for 1995. Included in operating expenses are amounts billed by Bell Communications Research, Inc. (Bellcore). Such expenses for 1995, 1994 and 1993 were $103.7 million, $99.8 million and $143.2 million, respectively, for various network planning, engineering, and software development projects. Bellcore expenses in 1994 include reimbursements of approximately $50 million from other Bellcore owners in connection with their decision to

Notes to Consolidated Financial Statements continued (16) ADDITIONAL FINANCIAL INFORMATION
(Dollars in Millions) - ------------------------------------------------------------------------------------------December 31, 1995 1994 - ------------------------------------------------------------------------------------------CONSOLIDATED BALANCE SHEETS: Accounts payable and accrued liabilities: Accounts payable $ 1,668.9 $ 1,595.2 Accrued expenses 513.1 625.0 Accrued vacation pay 242.4 251.5 Accrued taxes 195.9 137.2 Interest payable 103.2 128.5 --------------------$ 2,723.5 $ 2,737.4 =========== =========== Other current liabilities: Advance billings and customer deposits $ 412.9 $ 450.7 Dividend payable 306.4 301.0 --------------------$ 719.3 $ 751.7 =========== ===========

(Do - ------------------------------------------------------------------------------------------------------Years Ended December 31, 1995 1994 - ------------------------------------------------------------------------------------------------------CONSOLIDATED STATEMENTS OF CASH FLOWS: Cash paid during the year for: Interest, net of amounts capitalized $ 564.1 $ 569.1 Income taxes, net of amounts refunded 1,182.1 1,283.7 Noncash investing and financing activities: Conversion of accounts receivable to note receivable 3.4 Note receivable on sale of business 435.0 Note receivable on sale of asset 39.0 Acquisition of plant under capital leases 14.0 11.9 Common stock issued for incentive plans 4.0 5.3 Common stock issued for acquisitions 5.5 1.5 Contribution of net assets to joint ventures: Bell Atlantic NYNEX Mobile 1,178.1 Other 16.4 1.6 CONSOLIDATED STATEMENTS OF OPERATIONS: Interest expense incurred, net of amounts capitalized Capitalized interest

571.1 64.4 ------------

624.6 19.1 ------------

Interest expense incurred includes $10.1 million in 1995, $42.5 million in 1994 and $107.5 million in 1993 related to the Company's lease financing business. Such interest expense is classified as other operating expenses. Income taxes, as well as payroll, gross receipts, property, capital stock and other taxes, totaled $2,026.8 million for 1995. Included in operating expenses are amounts billed by Bell Communications Research, Inc. (Bellcore). Such expenses for 1995, 1994 and 1993 were $103.7 million, $99.8 million and $143.2 million, respectively, for various network planning, engineering, and software development projects. Bellcore expenses in 1994 include reimbursements of approximately $50 million from other Bellcore owners in connection with their decision to participate in the Advanced Intelligent Network project. This project previously had been supported entirely by the Company. Total advertising expense amounted to $122.0 million in 1995, $122.6 million in 1994 and $169.0 million in 1993.

44

Notes to Consolidated Financial Statements continued (17) QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
(Dollars in Millions, Exce --------------------------------------------------------------------------------Income Before Operating Operating Income Before Extraordinary Items Quarter Ended Revenues Income Extraordinary Items Per Common Share - ------------------------------------------------------------------------------------------------------1995: March 31 $ 3,449.7 $ 831.5 $ 414.5 $ .95 June 30 3,564.5 843.0 447.1 1.02 September 30/*/ 3,261.1 719.4 604.8 1.38 December 31 3,154.2 692.3 395.4 .90 ----------------------------------------------------1994: March 31 June 30 September 30/**/ December 31

3,419.6 3,430.0 3,455.3 3,486.5 --------------

$

748.8 797.5 591.0 667.3 --------------

$

395.9 415.4 275.7 314.9 --------------

$

.91 .95 .63 .72 --------------

$

* Net income for the third quarter of 1995 includes a gain of approximately $200 million related to the sale of certain cellular properties in connection with the formation of the Bell Atlantic NYNEX Mobile partnership (see Note 2). ** The loss for the third quarter of 1994 includes an extraordinary charge of $2,150.0 million, net of an income tax benefit of $1,498.4 million, related to the discontinuation of regulatory accounting principles by the Company's telephone subsidiaries (see Note 4). 45

EXHIBIT 21 Bell Atlantic Subsidiaries Anderson CellTelCo Atlantic West B.V. BA Parkway Associates BA Parkway Associates II BABS Australia Pty. Ltd. BAC Financial Services International B.V. BAC International - The Netherlands B.V. BAC International - The Netherlands B.V. Sucursal en Espana BACPE, Inc. BAP - 1760 Market, Inc. BAP - 1800 Arch Land Parcel, Inc. BAP - 6755 Snowdrift, Inc. BAP - 7150 Windsor, Inc. BAP - Caroline, Inc. BAP-Durham, Inc. BAPCI Services, Inc. BATCL - 1987 - I, Inc. BATCL - 1987 - II, Inc. BATCL - 1987 - III, Inc. BATCL-1991-I, Inc. BATCL-1991-II, Inc. BATCO-1989-II, Inc.

Notes to Consolidated Financial Statements continued (17) QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
(Dollars in Millions, Exce --------------------------------------------------------------------------------Income Before Operating Operating Income Before Extraordinary Items Quarter Ended Revenues Income Extraordinary Items Per Common Share - ------------------------------------------------------------------------------------------------------1995: March 31 $ 3,449.7 $ 831.5 $ 414.5 $ .95 June 30 3,564.5 843.0 447.1 1.02 September 30/*/ 3,261.1 719.4 604.8 1.38 December 31 3,154.2 692.3 395.4 .90 ----------------------------------------------------1994: March 31 June 30 September 30/**/ December 31

3,419.6 3,430.0 3,455.3 3,486.5 --------------

$

748.8 797.5 591.0 667.3 --------------

$

395.9 415.4 275.7 314.9 --------------

$

.91 .95 .63 .72 --------------

$

* Net income for the third quarter of 1995 includes a gain of approximately $200 million related to the sale of certain cellular properties in connection with the formation of the Bell Atlantic NYNEX Mobile partnership (see Note 2). ** The loss for the third quarter of 1994 includes an extraordinary charge of $2,150.0 million, net of an income tax benefit of $1,498.4 million, related to the discontinuation of regulatory accounting principles by the Company's telephone subsidiaries (see Note 4). 45

EXHIBIT 21 Bell Atlantic Subsidiaries Anderson CellTelCo Atlantic West B.V. BA Parkway Associates BA Parkway Associates II BABS Australia Pty. Ltd. BAC Financial Services International B.V. BAC International - The Netherlands B.V. BAC International - The Netherlands B.V. Sucursal en Espana BACPE, Inc. BAP - 1760 Market, Inc. BAP - 1800 Arch Land Parcel, Inc. BAP - 6755 Snowdrift, Inc. BAP - 7150 Windsor, Inc. BAP - Caroline, Inc. BAP-Durham, Inc. BAPCI Services, Inc. BATCL - 1987 - I, Inc. BATCL - 1987 - II, Inc. BATCL - 1987 - III, Inc. BATCL-1991-I, Inc. BATCL-1991-II, Inc. BATCO-1989-II, Inc. BATCO-1989-III, Inc. Bell Atlantic - Delaware, Inc.

EXHIBIT 21 Bell Atlantic Subsidiaries Anderson CellTelCo Atlantic West B.V. BA Parkway Associates BA Parkway Associates II BABS Australia Pty. Ltd. BAC Financial Services International B.V. BAC International - The Netherlands B.V. BAC International - The Netherlands B.V. Sucursal en Espana BACPE, Inc. BAP - 1760 Market, Inc. BAP - 1800 Arch Land Parcel, Inc. BAP - 6755 Snowdrift, Inc. BAP - 7150 Windsor, Inc. BAP - Caroline, Inc. BAP-Durham, Inc. BAPCI Services, Inc. BATCL - 1987 - I, Inc. BATCL - 1987 - II, Inc. BATCL - 1987 - III, Inc. BATCL-1991-I, Inc. BATCL-1991-II, Inc. BATCO-1989-II, Inc. BATCO-1989-III, Inc. Bell Atlantic - Delaware, Inc. Bell Atlantic - Maryland, Inc. Bell Atlantic - New Jersey, Inc. Bell Atlantic - Pennsylvania, Inc. Bell Atlantic - Virginia, Inc. Bell Atlantic - Washington, D.C., Inc. Bell Atlantic - West Virginia, Inc. Bell Atlantic Administrative Services, Inc. Bell Atlantic Asia, Inc. Bell Atlantic Australia Pty. Limited Bell Atlantic Austria, Inc. Bell Atlantic Aviation Services, Inc. Bell Atlantic Benelux, Inc. Bell Atlantic Capital Corporation Bell Atlantic Capital Funding Corp. Bell Atlantic Cellular Consulting Group, Inc. Bell Atlantic China Holdings Ltd. Bell Atlantic Communications and Construction Services, Inc. Bell Atlantic Computer Services International, Inc. Bell Atlantic Construction Services, Inc. Bell Atlantic Czech Republic, Inc. Bell Atlantic Directory Graphics, Inc. Bell Atlantic Electronic Publishing, Inc. Bell Atlantic Enterprises International, Inc. Bell Atlantic Entertainment and Information Services Group, Inc.

Bell Atlantic Europe S.A. Bell Atlantic Federal Integrated Systems, Inc. Bell Atlantic Federal Integrated Systems - Puerto Rico, Inc. Bell Atlantic Financial Services, Inc. Bell Atlantic Foreign Sales Corporation Bell Atlantic Foundation Bell Atlantic Gulf Holdings Ltd. Bell Atlantic Holdings Limited Bell Atlantic India, Inc. Bell Atlantic Indonesia, Inc. Bell Atlantic Information Systems, Inc.

Bell Atlantic Europe S.A. Bell Atlantic Federal Integrated Systems, Inc. Bell Atlantic Federal Integrated Systems - Puerto Rico, Inc. Bell Atlantic Financial Services, Inc. Bell Atlantic Foreign Sales Corporation Bell Atlantic Foundation Bell Atlantic Gulf Holdings Ltd. Bell Atlantic Holdings Limited Bell Atlantic India, Inc. Bell Atlantic Indonesia, Inc. Bell Atlantic Information Systems, Inc. Bell Atlantic InfoSpeed Corp. Bell Atlantic Integrated Systems, Inc. Bell Atlantic International - Italia S.r.L. Bell Atlantic International Ventures, Inc. Bell Atlantic International, Inc. Bell Atlantic Internet Solutions, Inc. Bell Atlantic Investment Development Corporation Bell Atlantic Investments, Inc. Bell Atlantic Land Development, Inc. Bell Atlantic Latin America Holdings, Inc. Bell Atlantic Market Research, Inc. Bell Atlantic Media Ventures, Inc. Bell Atlantic Meridian Systems Bell Atlantic Mexico, S.A. de C.V. Bell Atlantic Mobile Systems of Allentown, Inc. Bell Atlantic Mobile Systems of Northern New Jersey, Inc. Bell Atlantic Mobile Systems, Inc. Bell Atlantic Mobilfunk GmbH Bell Atlantic Network Funding Corporation Bell Atlantic Network Integration, Inc. Bell Atlantic Network Services, Inc. Bell Atlantic New Holdings, Inc. Bell Atlantic New Zealand Holdings, Inc. Bell Atlantic NSI Holdings, Inc. Bell Atlantic NYNEX Mobile, Inc. Bell Atlantic Paging, Inc. Bell Atlantic PAI Comunicaciones C.A. Bell Atlantic Payment Systems, Inc. Bell Atlantic Personal Communications, Inc. Bell Atlantic Poland, Inc. Bell Atlantic Professional Services, Inc. Bell Atlantic Properties, Inc. Bell Atlantic Property Holdings II, Inc. Bell Atlantic Property Holdings III, Inc. Bell Atlantic Puerto Rico, Inc. Bell Atlantic TELE-TV Holdings, Inc. Bell Atlantic Telecommunications Systems, Inc. Bell Atlantic TeleProducts Corp. Bell Atlantic Telezone Holdings, Inc. Bell Atlantic TriCon Leasing Corporation Bell Atlantic Utilities Systems, Inc. Bell Atlantic Vehicle Management Bell Atlantic Vehicle Management, Inc.

Bell Atlantic Ventures II, Inc. Bell Atlantic Ventures XXIII, Inc. Bell Atlantic Ventures XXV, Inc. Bell Atlantic Ventures XXVIII, Inc. Bell Atlantic Video Services Company Bell Atlantic Video Services, Inc. Bell Atlanticom Systems, Inc. Bell Communications Research CAI Wireless Systems, Inc. Chesapeake Directory Sales Company Columbia Cellular Telephone Company Essar Commvision Limited Essar Telecom Limited EuroTel Bratislava Ltd. EuroTel Praha Ltd.

Bell Atlantic Ventures II, Inc. Bell Atlantic Ventures XXIII, Inc. Bell Atlantic Ventures XXV, Inc. Bell Atlantic Ventures XXVIII, Inc. Bell Atlantic Video Services Company Bell Atlantic Video Services, Inc. Bell Atlanticom Systems, Inc. Bell Communications Research CAI Wireless Systems, Inc. Chesapeake Directory Sales Company Columbia Cellular Telephone Company Essar Commvision Limited Essar Telecom Limited EuroTel Bratislava Ltd. EuroTel Praha Ltd. FBA Computer Technology Services FM America Corp. Greenville Cellular Telephone Company HKP Partners of New Zealand Limited Howard W. Sams & Company ICA Foreign Financial, Inc. Infostrada S.p.A. IR Northlight II Associates Iron Run Venture I Iron Run Venture II Iron Run Venture III Las Cruces Cellular Telephone Company Metro Mobile CTS MIS, Inc. Metro Mobile CTS of Albuquerque, Inc. Metro Mobile CTS of Anderson, Inc. Metro Mobile CTS of Charlotte, Inc. Metro Mobile CTS of Cherokee, Inc. Metro Mobile CTS of Columbia, Inc. Metro Mobile CTS of El Paso, Inc. Metro Mobile CTS of Fairfield County, Inc. Metro Mobile CTS of Greenville, Inc. Metro Mobile CTS of Hartford, Inc. Metro Mobile CTS of Lancaster, Inc. Metro Mobile CTS of Las Cruces, Inc. Metro Mobile CTS of New Bedford, Inc. Metro Mobile CTS of New Haven, Inc. Metro Mobile CTS of New London, Inc. Metro Mobile CTS of Newport, Inc. Metro Mobile CTS of Phoenix, Inc. Metro Mobile CTS of Pittsfield, Inc. Metro Mobile CTS of Providence, Inc. Metro Mobile CTS of Springfield, Inc. Metro Mobile CTS of the Northeast, Inc. Metro Mobile CTS of the Southeast, Inc. Metro Mobile CTS of the Southwest, Inc. Metro Mobile CTS of Tucson, Inc. Metro Mobile CTS of Windham, Inc. Metro Mobile of Venezuela, Inc. Metro Mobile Real Estate Development of New York, Inc.

Metro Mobile Transport, Inc. MMDS Holdings II, Inc.

Metro Mobile Transport, Inc. MMDS Holdings II, Inc. MMDS Holdings, Inc. National Telephone Directory Company New Bedford Cellular Telephone Company Omnitel-Pronto Italiani S.p.A Omnitel-Sistemi Radiocellulari Italiani S.p.A. P.T. Citra Sari Makmur Pacific Star Communications (NSW) Pty. Ltd. Pacific Star Communications (QLD) Pty. Ltd. Pacific Star Communications Pty. Ltd. Penn-Del Directory Company Portal Investments, Inc. Sodalia S.p.A. Southwestco Wireless, Inc. Springfield Cellular Telephone Company The Bell Atlantic Systems Group, Inc. The Penn's Landing Marina Corporation

EXHIBIT 23 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the registration statements of Bell Atlantic Corporation on Form S-3 (File No. 33-30642), Form S-8 (File No. 2- 97281), Form S-3 (File No. 33-8451), Form S-8 (File No. 33-10377), Form S-8 (File No. 33-10378), Form S-8 (File No. 33-58681), Form S-8 (File No. 33-58683), Form S-8 (File No. 333-00409), Form S-3 (File No. 33-36551), Form S-3 (File No. 33-49085), Form S-3 (File No. 33-62393), Form S-4 (File No. 33-49025), of our reports dated February 5, 1996, which include an explanatory paragraph stating that the Company discontinued accounting for the operations of its telephone subsidiaries in accordance with Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation," effective August 1, 1994, and changed its method of accounting for income taxes and postemployment benefits in 1993, on our audits of the consolidated financial statements and financial statement schedule of the Company and its subsidiaries as of December 31, 1995 and December 31, 1994, and for each of three years in the period ended December 31, 1995, which reports are incorporated by reference or included in this Annual Report on Form 10-K.
/s/ Coopers & Lybrand L.L.P.

2400 Eleven Penn Center Philadelphia, Pennsylvania

March 27, 1996

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing

EXHIBIT 23 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the registration statements of Bell Atlantic Corporation on Form S-3 (File No. 33-30642), Form S-8 (File No. 2- 97281), Form S-3 (File No. 33-8451), Form S-8 (File No. 33-10377), Form S-8 (File No. 33-10378), Form S-8 (File No. 33-58681), Form S-8 (File No. 33-58683), Form S-8 (File No. 333-00409), Form S-3 (File No. 33-36551), Form S-3 (File No. 33-49085), Form S-3 (File No. 33-62393), Form S-4 (File No. 33-49025), of our reports dated February 5, 1996, which include an explanatory paragraph stating that the Company discontinued accounting for the operations of its telephone subsidiaries in accordance with Statement of Financial Accounting Standards No. 71, "Accounting for the Effects of Certain Types of Regulation," effective August 1, 1994, and changed its method of accounting for income taxes and postemployment benefits in 1993, on our audits of the consolidated financial statements and financial statement schedule of the Company and its subsidiaries as of December 31, 1995 and December 31, 1994, and for each of three years in the period ended December 31, 1995, which reports are incorporated by reference or included in this Annual Report on Form 10-K.
/s/ Coopers & Lybrand L.L.P.

2400 Eleven Penn Center Philadelphia, Pennsylvania

March 27, 1996

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ WILLIAM W. ADAMS ----------------------------------William W. Adams

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ WILLIAM W. ADAMS ----------------------------------William W. Adams

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS E. BOLGER ----------------------------------Thomas E. Bolger

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ FRANK C. CARLUCCI ----------------------------------Frank C. Carlucci

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS E. BOLGER ----------------------------------Thomas E. Bolger

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ FRANK C. CARLUCCI ----------------------------------Frank C. Carlucci

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 22nd day of March, 1996.
/s/ WILLIAM G. COPELAND ----------------------------------William G. Copeland

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ FRANK C. CARLUCCI ----------------------------------Frank C. Carlucci

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 22nd day of March, 1996.
/s/ WILLIAM G. COPELAND ----------------------------------William G. Copeland

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JAMES H. GILLIAM, JR. ----------------------------------James H. Gilliam, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 22nd day of March, 1996.
/s/ WILLIAM G. COPELAND ----------------------------------William G. Copeland

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JAMES H. GILLIAM, JR. ----------------------------------James H. Gilliam, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS H. KEAN ----------------------------------Thomas H. Kean

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JAMES H. GILLIAM, JR. ----------------------------------James H. Gilliam, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS H. KEAN ----------------------------------Thomas H. Kean

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOHN C. MAROUS, JR. ----------------------------------John C. Marous, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS H. KEAN ----------------------------------Thomas H. Kean

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOHN C. MAROUS, JR. ----------------------------------John C. Marous, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOHN F. MAYPOLE ----------------------------------John F. Maypole

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOHN C. MAROUS, JR. ----------------------------------John C. Marous, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOHN F. MAYPOLE ----------------------------------John F. Maypole

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOSEPH NEUBAUER ----------------------------------Joseph Neubauer

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOHN F. MAYPOLE ----------------------------------John F. Maypole

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOSEPH NEUBAUER ----------------------------------Joseph Neubauer

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS H. O'BRIEN ----------------------------------Thomas H. O'Brien

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JOSEPH NEUBAUER ----------------------------------Joseph Neubauer

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS H. O'BRIEN ----------------------------------Thomas H. O'Brien

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ ECKHARD PFEIFFER ----------------------------------Eckhard Pfeiffer

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ THOMAS H. O'BRIEN ----------------------------------Thomas H. O'Brien

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ ECKHARD PFEIFFER ----------------------------------Eckhard Pfeiffer

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ ROZANNE L. RIDGWAY ----------------------------------Rozanne L. Ridgway

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ ECKHARD PFEIFFER ----------------------------------Eckhard Pfeiffer

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ ROZANNE L. RIDGWAY ----------------------------------Rozanne L. Ridgway

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ SHIRLEY YOUNG ----------------------------------Shirley Young

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ ROZANNE L. RIDGWAY ----------------------------------Rozanne L. Ridgway

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ SHIRLEY YOUNG ----------------------------------Shirley Young

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ DOREEN A. TOBEN ----------------------------------Doreen A. Toben

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ SHIRLEY YOUNG ----------------------------------Shirley Young

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ DOREEN A. TOBEN ----------------------------------Doreen A. Toben

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ LAWRENCE T. BABBIO, JR. ----------------------------------Lawrence T. Babbio, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ DOREEN A. TOBEN ----------------------------------Doreen A. Toben

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ LAWRENCE T. BABBIO, JR. ----------------------------------Lawrence T. Babbio, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JAMES G. CULLEN ----------------------------------James G. Cullen

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 25th day of March, 1996.
/s/ LAWRENCE T. BABBIO, JR. ----------------------------------Lawrence T. Babbio, Jr.

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JAMES G. CULLEN ----------------------------------James G. Cullen

POWER OF ATTORNEY The undersigned does hereby constitute and appoint William O. Albertini, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ RAYMOND W. SMITH -----------------------------------

POWER OF ATTORNEY The undersigned does hereby constitute and appoint Raymond W. Smith and William O. Albertini, or either of them (with full power to act without the other), his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ JAMES G. CULLEN ----------------------------------James G. Cullen

POWER OF ATTORNEY The undersigned does hereby constitute and appoint William O. Albertini, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ RAYMOND W. SMITH -----------------------------------

Raymond W. Smith

ARTICLE 5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1995 AND THE CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. MULTIPLIER: 1,000,000

PERIOD TYPE FISCAL YEAR END PERIOD START PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS

YEAR DEC 31 1995 JAN 01 1995 DEC 31 1995 357 0 2,576 190 133 3,873

POWER OF ATTORNEY The undersigned does hereby constitute and appoint William O. Albertini, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, to sign in the name and on behalf of the undersigned, in any and all capacities in which the signature of the undersigned would be appropriate, the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and any and all amendments thereto for filing with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, and the rules, regulations and requirements of the Securities and Exchange Commission, and generally to do and perform all things which such attorneys, or any of them, may deem necessary or advisable in connection with the preparation, signing and filing of such Annual Report as fully and effectually in all respects as the undersigned could do if personally present. IN WITNESS WHEREOF, the undersigned has hereunto set his hand and seal this 26th day of March, 1996.
/s/ RAYMOND W. SMITH -----------------------------------

Raymond W. Smith

ARTICLE 5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1995 AND THE CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. MULTIPLIER: 1,000,000

PERIOD TYPE FISCAL YEAR END PERIOD START PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS PP&E DEPRECIATION TOTAL ASSETS CURRENT LIABILITIES BONDS COMMON PREFERRED MANDATORY PREFERRED OTHER SE TOTAL LIABILITY AND EQUITY SALES TOTAL REVENUES CGS TOTAL COSTS OTHER EXPENSES LOSS PROVISION INTEREST EXPENSE INCOME PRETAX INCOME TAX INCOME CONTINUING DISCONTINUED EXTRAORDINARY CHANGES NET INCOME EPS PRIMARY EPS DILUTED

YEAR DEC 31 1995 JAN 01 1995 DEC 31 1995 357 0 2,576 190 133 3,873 33,554 17,633 24,157 5,373 6,407 438 0 0 6,246 24,157 0 13,430 0 10,343 0 0 561 3,009 1,148 1,862 0 (4) 0 1,858 4.24 0

ARTICLE 5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 1995 AND THE CONSOLIDATED BALANCE SHEET AS OF DECEMBER 31, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. MULTIPLIER: 1,000,000

PERIOD TYPE FISCAL YEAR END PERIOD START PERIOD END CASH SECURITIES RECEIVABLES ALLOWANCES INVENTORY CURRENT ASSETS PP&E DEPRECIATION TOTAL ASSETS CURRENT LIABILITIES BONDS COMMON PREFERRED MANDATORY PREFERRED OTHER SE TOTAL LIABILITY AND EQUITY SALES TOTAL REVENUES CGS TOTAL COSTS OTHER EXPENSES LOSS PROVISION INTEREST EXPENSE INCOME PRETAX INCOME TAX INCOME CONTINUING DISCONTINUED EXTRAORDINARY CHANGES NET INCOME EPS PRIMARY EPS DILUTED

YEAR DEC 31 1995 JAN 01 1995 DEC 31 1995 357 0 2,576 190 133 3,873 33,554 17,633 24,157 5,373 6,407 438 0 0 6,246 24,157 0 13,430 0 10,343 0 0 561 3,009 1,148 1,862 0 (4) 0 1,858 4.24 0