AT&T (T)

For the purposes of this Plan, the following words and phrases shall have the meanings indicated, unless the context indicates otherwise:

As used in this Plan, the following terms shall have the respective meanings set forth below, and, when the meaning is intended, the initial letter of the word is capitalized:

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(1)         “Business Associate” shall mean an outside entity or person that performs administrative or other functions on behalf of the Plan;

(2)         “Health Care Operations” shall mean activities that involve, but are not limited to, quality assessment and improvement, the assessment of health care professionals, disease management, case management, legal services, benefits fraud and abuse investigations, and business planning and development (including cost-management and planning analyses). Health Care Operations also include, but are not limited to, general health care plan administrative functions such as management activities relating to compliance with HIPAA’s administrative simplification requirements, customer service involving the provision of data analysis for the Plan Sponsor of the HIPAA Plan and other entities whose employees participate in the HIPAA Plan, resolution of internal grievances and due diligence in connection with the sale or transfer of assets to a potential successor in interest if the potential successor is a covered entity, or will become a covered entity, under HIPAA;

(3)         “HIPAA” shall mean the Health Insurance Portability and Accountability Act of 1996 as amended from time to time.

(4)         “Payment” shall mean any activities performed that involve making benefit determinations and payment. These activities include, but are not limited to, billing, reviews for medical necessity, claims management, coordination of benefits, adjudication of health benefits claims (including appeals and other payment-related disputes), subrogation, plan reimbursement, investigations of potential fraud, determining employee contributions, reviews of appropriateness of care, preauthorizations and utilization reviews;

(5)          “Protected Health Information” or “PHI” shall mean individually identifiable information created or retained by the HIPAA Plan beginning on or after April 14, 2003 which pertains to a person’s past, present or future physical or mental health, the health care the person is receiving or has received in the past and all past, present or future Payments for the person’s health care;

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(6)         “Treatment” means the provision, coordination or management of health care and related services by one or more health care providers. This category includes, but is not limited to, consultations and referrals between health care providers, the coordination or management of health care by a health care provider with a third party and the referral of a patient for health care from one health care provider to another.

For purposes of the Plan, each of the following terms, when used with an initial capital letter, shall have the meaning set forth below unless a different meaning plainly is required by the context.

1.1 "Account" shall mean, with respect to a Participant or Beneficiary, the total dollar amount or value evidenced by the last balance posted in accordance with the terms of the Plan to the account record established for such Participant or Beneficiary with respect to the Deferral Contributions of such Participant for any Plan Year. "Account" shall also refer to a Master Account.

1.2 "Affiliate" shall mean at any time any corporation, joint venture or partnership in which BellSouth owns directly or indirectly, (i) with respect to a corporation, stock possessing at least ten percent (10%) of the total combined voting power of all classes of stock in the corporation, or (ii) in the case of a joint venture or partnership, a ten percent (10%) or greater interest in the capital or profits of such joint venture or partnership.

1.3 "BellSouth" shall mean BellSouth Corporation, a Georgia corporation.

1.4 "Beneficiary" shall mean, with respect to a Participant, the person(s) determined in accordance with Section 5.5 to receive any death benefits that may be payable under the Plan upon the death of the Participant.

1.5 "Board" shall mean the Board of Directors of BellSouth.

1.6 "Business Day" shall mean each day on which the New York Stock Exchange operates and is open to the public for trading.

1.7 "Code" shall mean the Internal Revenue Code of 1986, as amended.

1.8 "Company Stock" shall mean the $1.00 par value per share voting common stock of BellSouth.

1.9 "Compensation" shall mean the total of the directors' fees and retainers which actually would be payable to a Nonemployee Director during a Plan Year absent a Deferral Election under this Plan.

1.10 "Credited Interest Rate" shall mean, for each Plan Year, the rate of return equal to Moody's Monthly Average of Yields of a Corporate Bonds, as published by Moody's Investors Service, Inc., for the month of July immediately preceding such Plan Year. If such rate (or any alternative rate described in this sentence) is at any time no longer available, the Plan Administrator shall designate an alternative rate which in the Plan Administrator's reasonable judgment is generally comparable to the rate described in the preceding sentence, and such alternative rate shall thereafter be the Credited Interest Rate.

1.11 "Deferral Contributions" shall mean, for each Plan Year, that portion of a Participant's Compensation and that portion of a Participant's Stock Grant deferred under the Plan pursuant to Section 3.2.

1.12 "Deferral Election" shall mean a written election form provided by the Plan Administrator on which a Nonemployee Director may elect to defer under the Plan all or a portion of such individual's Compensation and/or Stock Grant for a Plan Year.

1.13 "Effective Date" shall mean May 1, 1997, the original effective date of the Plan.

1.14 "Election Deadline" shall mean, with respect to a Plan Year:

(a) For a Nonemployee Director who is then a member of the Board, the November 30 (or if November 30 is not a Business Day, the last Business Day immediately preceding November 30) immediately preceding the first day of such Plan Year.

(b) For a Nonemployee Director who is first elected by shareholders to be a member of the Board after (or within thirty (30) days before) the Election Deadline described in Section 1.14(a) above with respect to a Plan Year, the date which is thirty (30) days after the date the Nonemployee Director first becomes eligible to participate in the Plan.

1.15 "Election Package" shall mean a package consisting of a Deferral Election, an Investment Election and such other forms and documents distributed to Nonemployee Directors by the Plan Administrator for the purpose of allowing them to elect to actively participate in the Plan for a Plan Year.

1.16 "Interest Income Option" shall mean the Investment Option described in Section 4.4, pursuant to which a Participant's deemed investment earnings are determined on the basis of the Credited Interest Rate.

1.17 "Interest Income Subaccount" shall mean a bookkeeping subaccount reflecting that portion of a Participant's Accounts for each Plan Year which is deemed to be invested in the Interest Income Option.

1.18 "Investment Election" shall mean a written election form provided by the Plan Administrator on which a Nonemployee Director may elect to have such individual's Deferral Contributions for a Plan Year (and all investment earnings attributable thereto) deemed invested in either the Stock Unit Option and/or the Interest Income Option, to the extent permitted under the terms of the Plan.

1.19 "Investment Options" shall mean the Stock Unit Option and the Interest Income Option.

1.19A "Master Account" shall have the meaning ascribed to such term in Article VI-A.

1.20 "Nonemployee Director" shall mean a member of the Board, or a member of the Board of Directors of any other Participating Company, who is not concurrently a common law employee of a Participating Company.

1.21 "Participant" shall mean any person participating in the Plan pursuant to the provisions of Article II.

1.22 "Participating Company" shall mean BellSouth and each Affiliate which, by action of its Board of Directors (or equivalent governing body), adopts the Plan as a Participating Company with the approval of the Plan Administrator.

1.23 "Plan" shall mean the BellSouth Corporation Directors' Compensation Deferral Plan, as contained herein and all amendments hereto.

1.24 "Plan Administrator" shall mean the Chief Executive Officer of BellSouth and any individual or committee the Chief Executive Officer designates to act on his or her behalf with respect to any or all of the Chief Executive Officer's responsibilities hereunder; provided, the Board may designate any other person or committee to serve in lieu of the Chief Executive Officer as the Plan Administrator with respect to any or all of the administrative responsibilities hereunder.

1.25 "Plan Year" shall mean each fiscal year period beginning on May 1 and ending on April 30 of the succeeding calendar year.

1.26 "Stock Grant" shall mean for each Plan Year the annual grant of two hundred (200) shares of Company Stock awarded to Nonemployee Directors beginning May 1, 1997, or such other amount as may be determined by the Board from time to time.

1.27 "Stock Unit" shall mean an accounting entry that represents an unsecured obligation of a Participating Company to pay to a Participant an amount which is based on the fair market value of one share of Company Stock as set forth herein. A Stock Unit shall not carry any voting, dividend or other similar rights and shall not constitute an option or any other right to acquire any equity securities of BellSouth.

1.28 "Stock Unit Option" shall mean the Investment Option described in Section 4.3, pursuant to which a Participant's deemed investment earnings are determined by the rate of return (determined as provided in the Plan) applicable to Stock Units.

1.29 "Stock Unit Subaccount" shall mean a bookkeeping subaccount reflecting that portion of a Participant's Account for each Plan Year which is deemed to be invested in the Stock Unit Option.

1.30 "Valuation Date" shall mean (i) for purposes of Article V, each December 31 (or, if December 31 is not a Business Day, the last Business Day immediately preceding December 31), and (ii) for all other purposes, each April 30, July 31, October 31, and January 31 (or if any such date is not a Business Day, the last Business Day immediately preceding such date), and each other day declared by the Plan Administrator to be a Valuation Date.

As used in this Plan, the following terms shall have the respective meanings set forth below, and, when the meaning is intended, the initial letter of the word is capitalized:

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