8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549


FORM 8-K

CURRENT REPORT
Pursuant To Section 13 Or 15(d) of
The Securities Exchange Act of 1934


Date of report (Date of earliest event reported): March 29, 2005

MCI, Inc.
(Exact Name of Registrant as Specified in Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
001-10415	20-0533283
(Commission File Number)	(IRS Employer Identification No.)
22001 Loudoun County Parkway, Ashburn, Virginia	20147
(Address of Principal Executive Offices)	(Zip Code)
Registrant’s telephone number, including area code: (703) 886-5600
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)

     Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement

     On March 29, 2005, Verizon Communications Inc., a Delaware corporation (“Verizon”), MCI, Inc., a Delaware corporation (“MCI”) and Eli Acquisition, LLC, a wholly owned subsidiary of Verizon and a Delaware limited liability company (“Merger Sub”) entered into an amendment (the “Amendment”) to the Agreement and Plan of Merger dated as of February 14, 2005, among Verizon, MCI and Merger Sub, as previously amended by the letter agreement dated as of March 4, 2005 (as so amended, the “Merger Agreement”). Capitalized terms used but not defined herein shall have the respective meanings specified in the Merger Agreement.

     The Amendment amends the terms of the Merger Agreement to, among other things, (i) increase the per share amount of the special cash dividend expected to be declared by MCI as soon as practicable following approval of the Merger Agreement by stockholders of MCI from $4.10 to up to $5.60 (less the amount of any dividends declared by MCI during the period from February 14, 2005 to the consummation of the Merger), (ii) increase the per share amount of cash consideration to be paid by Verizon to the stockholders of MCI at the effective time from $1.50 to $2.75 (plus, if the special cash dividend is less than $5.60, an amount equal to such difference), and (iii) provide that, in lieu of receiving a fixed exchange ratio of 0.4062 Verizon shares, MCI stockholders will receive the greater of 0.4062 Verizon shares or such number of Verizon shares that has a value of $14.75 at the effective time, based on the volume weighted average of the closing prices of Verizon shares, as such prices are reported on the NYSE Composite Transactions Tape, for each of the 20 trading days ending on the third trading day immediately preceding the effective time; provided that, Verizon may, at its option, elect to pay additional cash instead of issuing additional shares over the 0.4062 exchange ratio. The purchase price adjustment mechanism from the Merger Agreement based on MCI bankruptcy claims and certain tax liabilities has been retained, but the threshold at which the adjustment is triggered has been increased from $1.725 billion to $1.775 billion.

     In addition, pursuant to the terms of the Amendment, the termination fee that MCI may be required to pay to Verizon upon termination of the Merger Agreement under specified circumstances has been increased from $200 to $240 million, and MCI has also agreed to reimburse Verizon for up to $10 million of its expenses upon termination of the Merger Agreement under specified circumstances. In addition, under the Amendment, in the event that the MCI board of directors makes a change in its recommendation of the Merger to MCI stockholders, Verizon has the option to request MCI to cause a stockholder meeting to be held to consider approval of the Merger and the other transactions contemplated by the Merger Agreement, notwithstanding the MCI board’s change in recommendation.

     The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the Amendment, which is filed as Exhibit 2.1 hereto, and the Merger Agreement, which was filed as Exhibit 2.1 to Form 8-K on February 17, 2005, both of which are incorporated herein by reference.

Item 8.01. Other Events.

     On March 29, 2005, MCI issued a press release announcing the execution of the Amendment. The press release is attached as Exhibit 99.1 hereto and is incorporated herein by reference.

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FORWARD-LOOKING STATEMENTS

This document contains statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The following important factors could affect future results and could cause those results to differ materially from those expressed in the forward-looking statements: a significant change in the timing of, or the imposition of any government conditions to, the closing of the previously announced proposed transaction; actual and contingent liabilities; and the extent and timing of our ability to obtain revenue enhancements and cost savings following the previously announced proposed transaction. Additional factors that may affect the future results of MCI and Verizon are set forth in their respective filings with the Securities and Exchange Commission, which are available at investor.verizon.com/SEC/ and www.mci.com/about/investor_relations/sec/.

Additional Information and Where to Find It

In connection with the previously announced proposed transaction between MCI and Verizon, a registration statement, including a proxy statement of MCI, and other materials will be filed with the Securities and Exchange Commission (“SEC”). We urge investors to read these documents when they become available because they will contain important information. Investors will be able to obtain free copies of the registration statement and proxy statement, as well as other filed documents containing information about MCI and Verizon, at www.sec.gov, the SEC’s website. Investors may also obtain free copies of these documents at www.verizon.com/investor, or by request to Verizon Communications Inc., Investor Relations, 1095 Avenue of the Americas, 36th Floor, New York, NY 10036. Free copies of MCI’s filings are available at www.mci.com/about/investor_relations, or by request to MCI, Inc., Investor Relations, 22001 Loudoun County Parkway, Ashburn, VA 20147.

Participants in the Solicitation

MCI, Verizon, and their respective directors, executive officers, and other employees may be deemed to be participants in the solicitation of proxies from MCI shareowners with respect to the previously announced proposed transaction between MCI and Verizon. Information about MCI’s directors and executive officers is available in MCI’s annual report on Form 10-K for the year ended December 31, 2003. Information about Verizon’s directors and executive officers is available in Verizon’s proxy statement for its 2005 annual meeting of stockholders, dated March 21, 2005. Additional information about the interests of potential participants will be included in the registration statement and proxy statement and other materials filed with the SEC.

Item 9.01. Financial Statements and Exhibits

(c) Exhibits

Exhibit No.	Description
2.1	Amendment, dated as of March 29, 2005, to the Agreement and Plan of Merger dated as of February 14, 2005 among Verizon Communications Inc., Eli Acquisition, LLC, and MCI, Inc., as previously amended by letter agreement dated as of March 4, 2005, among the parties to the Merger Agreement.
99.1	Press Release issued by MCI, dated March 29, 2005.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		MCI, INC.
Date:	March 29, 2005	By:	/s/ Robert T. Blakely
			Name:	Robert T. Blakely
			Title:	Executive Vice President and Chief Financial Officer

EX-2.1

Exhibit 2.1

AMENDMENT TO
AGREEMENT AND PLAN OF MERGER

     This Amendment, dated as of March 29, 2005 (this “Amendment”) to the Agreement and Plan of Merger, dated as of February 14, 2005, among Verizon Communications Inc., a Delaware corporation, Eli Acquisition, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Verizon Communications Inc., and MCI, Inc., a Delaware corporation, as previously amended by letter agreement dated as of March 4, 2005, among the parties to the Merger Agreement (as so amended, the “Merger Agreement”), is entered into by the parties to the Merger Agreement. Capitalized terms used but not defined herein shall have the respective meanings specified in the Merger Agreement.

     WHEREAS, Parent, Merger Sub and the Company have entered into the Merger Agreement;

     WHEREAS, Parent, Merger Sub and the Company desire to amend the Merger Agreement as provided in this Amendment; and

     WHEREAS, the respective Boards of Directors of Parent, Merger Sub and the Company have deemed this Amendment advisable and in the best interests of their respective companies;

     NOW, THEREFORE, in consideration of the foregoing and the mutual agreements herein made and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows:

     1. Merger Consideration and Related Provisions.

     (a) Section 1.8(a) of the Merger Agreement shall be amended and restated to read in its entirety as follows:

     “At the Effective Time, by virtue of the Merger and without any action on the part of the holder thereof, each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (excluding any Company Restricted Shares and Excluded Shares) shall be converted into the right to receive (i) a number (the “Exchange Ratio”) of validly issued, fully paid and non-assessable shares of Parent Common Stock equal to the greater of (A) 0.4062 and (B) the quotient obtained by dividing $14.75 by the Average Parent Stock Price (the “Stock Consideration”), and (ii) an amount in cash equal to $8.35 minus the amount of the Special Cash Dividend declared pursuant to Section 6.16 (the “Per Share Cash Amount”), without interest, together with any cash in lieu of fractional shares of Parent Common Stock to be paid pursuant to Section 2.5 (such shares and cash, the “Base Merger Consideration”). Notwithstanding the foregoing, if the

Exchange Ratio is greater than 0.4062, then Parent shall have the right, in its absolute discretion, to reduce the Exchange Ratio to an amount no less than 0.4062 and, in such case, the Per Share Cash Amount shall be increased by an amount (rounded to the nearest hundredth of a cent) equal to the product of (x) the amount by which Parent has reduced the Exchange Ratio and (y) the Average Parent Stock Price. The Exchange Ratio and the Per Share Cash Amount determined above shall be subject to adjustment pursuant to Section 1.10 (as so adjusted, the “Merger Consideration”). For purposes of this Agreement, “Average Parent Stock Price” shall mean the volume weighted average of the closing prices of Parent Common Stock, as such prices are reported on the NYSE Composite Transactions Tape, for each of the 20 trading days ending on the third trading day immediately preceding the Effective Time.”

     (b) Section 1.10(g) of the Merger Agreement shall be amended by (i) deleting the words “shall be equal to the product of (x) 0.4062” and replacing them with the words “following such adjustment shall be equal to the product of (x) the Exchange Ratio prior to such adjustment”, and (ii) deleting each reference to the number “$1,725,000,000” and replacing it with the number “$1,775,000,000”.

     (c) Section 3.28 of the Merger Agreement shall be amended by (i) deleting the words “February 13, 2005” and replacing them with the words “March 29, 2005”, and (ii) deleting the words “, the Special Cash Dividend and the $0.40 per share cash dividend declared by the Board of Directors of the Company on February 11, 2005” and replacing them with the words “and the Special Cash Dividend”.

     (d) Section 6.16 of the Merger Agreement shall be amended by (i) deleting the words “unless prohibited by applicable law or covenants in instruments of Indebtedness existing as of the date hereof” and replacing them with the words “to the extent not prohibited by applicable law or covenants in instruments of Indebtedness existing as of the date hereof”, and (ii) deleting the reference to the number “$4.10” and replacing it with the number “$5.60” .

     2. Representations and Warranties.

     (a) The first paragraph of Article III of the Merger Agreement shall be amended by (i) adding, immediately after the words “prior to the date hereof”, the words “or in the Company’s Form 10-K for the year ended December 31, 2004”, and (ii) adding, immediately after the words “any such Company SEC Document”, the words “or such Form 10-K”.

     (b) The first paragraph of Article IV of the Merger Agreement shall be amended by (i) adding, immediately after the words “prior to the date hereof”, the words “or in Parent’s Form 10-K for the year ended December 31, 2004”, and (ii) adding,

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immediately after the words “any such Parent SEC Document”, the words “or such Form 10-K”.

     3. Non-Solicitation. Section 6.5(c) of the Merger Agreement shall be amended by (a) deleting the words “two Business Days” in the parenthetical to clause (ii) in the second proviso of its second sentence and replacing them with the words “three Business Days”, and (b) deleting the words “as a result of an Intervening Event” in its fourth sentence.

     4. Termination and Termination Fee.

     (a) Section 8.1(d)(ii) of the Merger Agreement shall be amended and restated to read in its entirety as follows:

           “(ii) pursuant to the last sentence of Section 6.5(c), if the Company, prior to the termination of this Agreement, pays the Termination Fee (as defined in Section 8.3(a)) to Parent.”

     (b) Sections 8.3(a) and 8.3(b) of the Merger Agreement shall be amended and restated to read in their entirety as follows:

           “(a) If this Agreement is terminated pursuant to any of the following provisions, the Company shall pay to Parent a fee equal to $240,000,000 (the “Termination Fee”), which Termination Fee, together with the reimbursement of Expenses pursuant to Section 8.3(b), shall be Parent’s sole remedy in respect of termination of this Agreement except in the case of any willful breach of this Agreement by the Company:

     (i) Sections 8.1(c)(ii) or (iii);

     (ii) Section 8.1(d)(ii);

     (iii) Section 8.1(b)(iii), provided that within twelve months after the date of such termination, the Company enters into a definitive agreement to consummate, or consummates, the transactions contemplated by any Takeover Proposal; and provided, further, that, solely for purposes of this Section 8.3(a)(iii), the term “Takeover Proposal” shall have the meaning ascribed thereto in Section 6.5(e), except that all references to 15% shall be changed to 40%; or

     (iv) Section 8.1(c)(i), provided, that such termination is based on a material breach of Section 6.2.

     (b) If the Company is required to pay Parent a Termination Fee, such Termination Fee shall be payable immediately prior to termination of this Agreement in

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the event of termination by the Company, and not later than one Business Day after the receipt by the Company of a notice of termination from Parent in the event of termination by Parent, in each case by wire transfer of immediately available funds to an account designated by Parent (except that, in the case of termination pursuant to Section 8.1(b)(iii), such payment shall be made on the date of the first to occur of either of the events referred to in the first proviso to Section 8.3(a)(iii)) . If the Company is required to pay Parent a Termination Fee, or this Agreement is terminated pursuant to Section 8.1(b)(iii), the Company shall, in addition to any Termination Fee that may be payable, reimburse Parent and Merger Sub for all of their Expenses, up to a maximum amount of $10,000,000, within one Business Day of receipt of written notice from Parent requesting payment thereof.”

     5. Ratification. Except as otherwise provided herein, all of the terms, covenants and other provisions of the Merger Agreement are hereby ratified and confirmed and shall continue to be in full force and effect in accordance with their respective terms. After the date hereof, all references to the Merger Agreement shall refer to the Merger Agreement as amended by this Amendment.

     6. Miscellaneous. Section 9.10 of the Merger Agreement shall apply to this Amendment mutatis mutandi. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall together constitute one and the same instrument and shall bind and inure to the benefit of the parties and their respective successors and assigns.

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      IN WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this Amendment to be signed by their respective officers thereunto duly authorized, all as of the date first written above.

VERIZON COMMUNICATIONS INC.
By:	/s/ Ivan Seidenberg
	Name:	Ivan Seidenberg
	Title:	Chairman of the Board and Chief Executive Officer
ELI ACQUISITION, LLC
By:	/s/ John W. Diereksen
	Name:	John W. Diereksen
	Title:	Executive Vice President Strategy, Planning and Development
MCI, INC.
By:	/s/ Michael D. Capellas
	Name:	Michael D. Capellas
	Title:	Chief Executive Officer

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EX-99.1

Exhibit 99.1

MCI ACCEPTS REVISED PROPOSAL FROM VERIZON

Increase in cash of $2.75 per share (or approximately $900 million)

Guarantees minimum equity value

ASHBURN, Va., March 29, 2005 – MCI, Inc. (NASDAQ: MCIP) today said that it received revised proposals from Verizon and Qwest. After a review of both proposals MCI’s Board of Directors accepted Verizon’s revised offer. MCI and Verizon have amended their February 14, 2005 merger agreement accordingly.

Revised Verizon Proposal
Under the revised Verizon proposal, each MCI share will receive cash and stock worth at least $23.50, comprising an increase in cash of $2.75 (or approximately $900 million in the aggregate) to $8.75 (including MCI’s March 15 dividend payment of $0.40 per share) as well as the greater of 0.4062 Verizon shares for every share of MCI Common Stock or Verizon shares valued at $14.75. Under this price protection feature, Verizon may elect to pay additional cash instead of issuing additional shares over the 0.4062 exchange ratio.

Of the $8.75, up to $5.60 is expected to be paid upon approval of the transaction by MCI’s shareholders.

Under the revised proposal, MCI may be required to pay Verizon a termination fee in the event the agreement is terminated. Under specified circumstances, this termination fee has been increased to $240 million from $200 million and reimbursement to Verizon for its expenses up to $10 million.

In making its determination, MCI’s Board considered the following factors, among others: the changing competitive nature of the telecommunications industry; increasing need for scale and comprehensive wireless capabilities; access economics; the level and achievability of synergies; strength of capital structure; the ongoing ability to sustain network service quality and invest in new capabilities; and ensuring ongoing customer confidence among MCI’s large enterprise and government customers.

“MCI’s Board has been closely and carefully evaluating all of the recent developments,” said Nicholas deB. Katzenbach, MCI Chairman of the Board. “We believe Verizon’s substantial increase in its offer, the strength of its competitive position and the financial certainty at close make this offer compelling to our shareholders, customers and employees.”

Original MCI/Verizon Merger Terms
The original merger agreement entered into with Verizon on February 14, 2005 provided MCI shareholders with $6.00 in cash (including MCI’s March 15 dividend payment of $0.40 per share) and 0.4062 Verizon shares, representing a total value of $20.12 per MCI share based on Verizon’s closing share price on March 24, 2005.

Revised Qwest Proposal
Qwest’s latest offer stands at $10.50 in cash (including MCI’s March 15 dividend payment of $0.40 per share) and 3.735 Qwest shares (subject to adjustment under a collar which fixes the value of the Qwest shares at $15.50 provided Qwest’s share price is between $3.74 and $4.57) per MCI share. The revised Qwest offer included increased financing by $500 million to $5.75 billion. Qwest’s offer terminates on April 5, 2005.

About MCI
MCI, Inc. (NASDAQ: MCIP) is a leading global communications provider, delivering innovative, cost-effective, advanced communications connectivity to businesses, governments and consumers. With the industry's most expansive global IP backbone, based on the number of company-owned points of presence, and wholly-owned data networks, MCI develops the converged communications products and services that are the foundation for commerce and communications in today's market. For more information, go to www.mci.com.

In connection with the previously announced proposed transaction between MCI and Verizon, a registration statement, including a proxy statement of MCI, and other materials will be filed with the Securities and Exchange Commission ("SEC"). We urge investors to read these documents when they become available because they will contain important information. Investors will be able to obtain free copies of the registration statement and proxy statement, as well as other filed documents containing information about MCI and Verizon, at www.sec.gov, the SEC’s website. Investors may also obtain free copies of these documents at www.verizon.com/investor, or by request to Verizon Communications Inc., Investor Relations, 1095 Avenue of the Americas, 36th Floor, New York, NY 10036. Free copies of MCI’s filings are available at www.mci.com/about/investor_relations, or by request to MCI, Inc., Investor Relations, 22001 Loudoun County Parkway, Ashburn, VA 20147.

MCI, Verizon, and their respective directors, executive officers, and other employees may be deemed to be participants in the solicitation of proxies from MCI shareowners with respect to the previously announced proposed transaction between MCI and Verizon. Information about MCI’s directors and executive officers is available in MCI’s annual report on Form 10-K for the year ended December 31, 2003. Information about Verizon’s directors and executive officers is available in Verizon’s proxy statement for its 2004 annual meeting of shareholders, dated March 15, 2004. Additional information about the interests of potential participants will be included in the registration statement and proxy statement and other materials filed with the SEC.

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