DOCKET UT-971424 Page 1 BEFORE THE WASHINGTON UTILITIES AND TRANSPORTATION COMMISSION Joint Application of ) U.S. LONG DISTANCE, INC., and ) DOCKET UT-971424 LCI INTERNATIONAL, INC., ) for Approval of the Transfer of Control ) ORDER GRANTING of U.S. LONG DISTANCE, INC., to ) APPLICATION LCI INTERNATIONAL, INC., ) . . . . . . . . . . . . . . . . . . . . ) On December 13, 1996, USLD Communications, Inc., (USLDI) and LCI International, Inc., (LCI), jointly filed an application with the Commission under the provisions of chapter RCW 80.12 and chapter WAC 480-143 for an order approving the transfer of control of USLDI to LCI. USLDI was registered as a telecommunications company in Docket UT-893222. The order authorizing registration was based upon USLDI providing resold direct dial long distance services. LCI was authorized to provide services as a telecommunications company in Docket UT-920034. LCI was authorized to provide resold direct dial long distance services. LCI and USLD Communications Corp., (USLDC) entered into a definitive Agreement and Plan of Merger pursuant to which LCI will acquire USLDC by purchasing all of the company's outstanding shares. Since USLDI is wholly owned by USLDC, the acquisition of USLDC by LCI will result in a transfer of ultimate control of USLDI to LCI. The transfer of control will be accomplished through use of a reverse triangular merger whereby a newly formed, special purpose subsidiary of LCI, LCI Acquisition Corp., will be merged with and into USLDC. USLDC will be the surviving entity, and will thereafter be a wholly owned subsidiary of LCI. USLDI will continue to exist as a wholly owned subsidiary of USLDC. The merger of USLDC and LCI is defined in the Agreement and Plan of Merger filed as part of the application. After the transfer of control, USLDC will survive for an indefinite period as a wholly owned subsidiary of LCI, and USLDI will remain a subsidiary of USLDC. USLDI will continue to operate as it has in the past, pursuant to the same name, tariff, and operating authority. The transfer of control will be seamless and will have no adverse impact on USLDI's customers in Washington. FINDINGS THE COMMISSION FINDS: 1. USLD Communications, Inc., is a public service company subject to regulation by this Commission, under the provisions of chapters, RCW 80.12 and RCW 80.36. 2. LCI International, Inc., is a public service company subject to regulation by this Commission, under the provisions of chapters, RCW 80.12 and RCW 80.36. 3. As to form, the application filed herein meets the requirements of chapter RCW 80.12 and the rules and regulations of the Commission adopted pursuant thereto. 4. The proposed transfer of control is not inconsistent with the public interest and should therefore be approved under the terms and conditions of this order. O R D E R THE COMMISSION ORDERS: 1. After the effective date of this order and subject to the conditions hereof, USLD Communications, Inc., is hereby authorized to transfer control to LCI International, Inc., in accordance with the Agreement and Plan of Merger filed as part of the application herein. 2. Prior to exercising the above authorized transfer of control, LCI International, Inc., will file with the Commission true copies of the instruments of the merger that were executed pursuant to this order. 3. This order shall in no way affect the authority of this Commission over rates, service, evaluations, or accounts that may come before it, nor shall anything herein be construed as an acquiescence in any estimate or determination of cost or any valuation of property claimed or asserted. DATED at Olympia, Washington, and effective this 26th day of November, 1997. STEVE McLELLAN, Secretary