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Talk America (TALK) today announced that it has signed a commercial agreement with the incumbent local exchange carrier subsidiaries of SBC Communications Inc., the Company's largest network supplier. We are pleased with the terms of the agreement, which enables us to continue offering high quality telecommunications services to our customers who are currently served on SBC's UNE-P platform. These customers will experience a seamless transition to the SBC Telephone Companies' wholesale platform.

This new agreement enables us to continue our relationship with SBC and presents the opportunity to serve customers, such as multi-location business customers, that are outside our local network footprint. In addition, the agreement gives us flexibility to continue to move customers onto our own local network. Entering into this agreement now removes any uncertainty regarding the cost of providing services to our off-net customers after March 11, 2006.

The economics of the agreement are better than expected resale pricing and more favorable than our previously announced expectations. For lines outside our networking footprint, we are expecting an increase in monthly costs of a range of $4 to $6 per line. As a result, we are not adjusting our previously announced guidance for the end of the year, despite entering into this agreement earlier than forecasted.

Who takes this to mean that they got more out of SBC than they had expected...
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