GTE CALIFORNIA INC
S-3, 1998-02-20
TELEPHONE COMMUNICATIONS (NO RADIOTELEPHONE)
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<PAGE>
 
  AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 20, 1998.
                                                     REGISTRATION NO. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                               ----------------
                                   FORM S-3
                            REGISTRATION STATEMENT
                                     UNDER
                          THE SECURITIES ACT OF 1933
 
                               ----------------
                          GTE CALIFORNIA INCORPORATED
            (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
                               ----------------
 
<TABLE>
<S>                                            <C>
                 CALIFORNIA                                      95-0510200
          (STATE OF INCORPORATION)                  (I.R.S. EMPLOYER IDENTIFICATION NO.)
</TABLE>
 
                     600 HIDDEN RIDGE, IRVING, TEXAS 75038
                                (972) 718-5600
         (ADDRESS AND TELEPHONE NUMBER OF PRINCIPAL EXECUTIVE OFFICES)
 
                               ----------------
<TABLE>
<S>                                            <C>
           DAVID S. KAUFFMAN, ESQ.                         CHARLES J. SOMES, ESQ.
           GTE SERVICE CORPORATION                      GTE CALIFORNIA INCORPORATED
             ONE STAMFORD FORUM                               600 HIDDEN RIDGE
         STAMFORD, CONNECTICUT 06904                        IRVING, TEXAS 75038
               (203) 965-2986                                  (972) 718-5600
</TABLE>
        (NAMES, ADDRESSES AND TELEPHONE NUMBERS OF AGENTS FOR SERVICE)
 
                                  COPIES TO:
                         ROBERT W. MULLEN, JR., ESQ.,
                       MILBANK, TWEED, HADLEY & MCCLOY,
                           1 CHASE MANHATTAN PLAZA,
                           NEW YORK, NEW YORK 10005
                               ----------------
 
  APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of the Registration Statement.
 
  If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
 
  If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
 
  If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
registration statement for the same offering. [_] 333-
 
  If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] 333-
 
  If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
                        CALCULATION OF REGISTRATION FEE
<TABLE>
- -----------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------
<CAPTION>
                                                       PROPOSED       PROPOSED
                                                       MAXIMUM        MAXIMUM       AMOUNT OF
 TITLE OF EACH CLASS OF SECURITIES    AMOUNT TO BE  OFFERING PRICE   AGGREGATE     REGISTRATION
         TO BE REGISTERED              REGISTERED      PER UNIT    OFFERING PRICE      FEE*
- -----------------------------------------------------------------------------------------------
 <S>                                  <C>              <C>       <C>              <C>
                                      
 Debentures...................        $300,000,000 **  100%      $300,000,000     $88,500.00 **
- -----------------------------------------------------------------------------------------------
</TABLE>
*  Registration fee is calculated pursuant to Rule 457(a) under the Securities
   Act of 1933.
** As permitted by Rule 429 under the Securities Act of 1933, as amended, the
   prospectus contained in this Registration Statement also covers
   $100,000,000 of Debentures previously registered and unissued (Registration
   Statement No. 333-01001). The Registrant previously paid a filing fee of
   $139,310.35 with such registration statement ($34,482.75 of which is
   associated with the $100,000,000 of Debentures covered by the prospectus
   contained in this Registration Statement).
 
                               ----------------
  THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE
REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION,
ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
 
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
 
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A         +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE   +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY  +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT        +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR   +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE      +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE    +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF  +
+ANY SUCH STATE.                                                               +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

                 SUBJECT TO COMPLETION, DATED FEBRUARY 20, 1998
 
                      [LOGO] GTE CALIFORNIA INCORPORATED
 
                                   DEBENTURES
 
                                 ------------
 
  GTE California Incorporated (the "Company") intends to offer from time to
time up to $400,000,000 aggregate principal amount of its debentures (the "New
Debentures") in one or more series at prices and on terms to be determined at
the time or times of sale. The aggregate principal amount, rate and time of
payment of interest, maturity, initial public offering price, if any,
redemption provisions and other specific terms of each series of New Debentures
will be set forth in an accompanying prospectus supplement ("Prospectus
Supplement").
 
                                 ------------
 
   THESE SECURITIES HAVE NOT BEEN APPROVED  OR DISAPPROVED BY THE SECURITIES
      AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS 
             THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE 
              SECURITIES COMMISSION PASSED UPON THE ACCURACY OR 
               ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION 
                    TO THE CONTRARY IS A CRIMINAL OFFENSE.
 
                                 ------------
 
  The Company may sell the New Debentures through underwriters or agents, or
directly to one or more institutional purchasers. A Prospectus Supplement will
set forth the names of underwriters, if any, any applicable commissions or
discounts, the price of the New Debentures and the net proceeds to the Company
from any such sale or sales.
 
                                 ------------
 
 
 
                 The date of this Prospectus is        , 1998.
<PAGE>
 
                      STATEMENT OF AVAILABLE INFORMATION
 
  The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports and other information with the Securities and
Exchange Commission (the "SEC"). These reports and other information can be
inspected and copied at the public reference facilities maintained by the SEC
at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, as well as at
the following Regional Offices: Seven World Trade Center, New York, New York
10048 and 500 West Madison Street, Chicago, Illinois 60661. Copies of such
material can be obtained from the public reference section of the SEC at its
prescribed rates. In addition, the SEC maintains a web site that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the SEC. The address of this site is
http://www.sec.gov.
 
                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
 
  The following documents are incorporated herein by reference:
 
  1.   The Annual Report on Form 10-K of the Company for the year ended
       December 31, 1996;
 
  2.   The Quarterly Reports on Form 10-Q of the Company for the quarters
       ended March 31, 1997, June 30, 1997 and September 30, 1997; and
 
  3.   The Current Report on Form 8-K of the Company dated September 4, 1997.
 
  All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the New Debentures hereunder shall be deemed to
be incorporated by reference in this Prospectus and to be part hereof from the
date of filing of such documents.
 
  The Company hereby undertakes to provide without charge to each person to
whom a copy of this Prospectus has been delivered, on the written or oral
request of any such person, including any beneficial owner, a copy of any or
all of the documents referred to above which have been or may be incorporated
in this Prospectus by reference, other than exhibits to such documents unless
such exhibits are specifically incorporated by reference into the information
that the Prospectus incorporates. Requests for such copies should be directed
to David S. Kauffman, Esq., Assistant Secretary of the Company, at One
Stamford Forum, Stamford, Connecticut 06904. Mr. Kauffman's telephone number
is (203) 965-2986.
 
                                  THE COMPANY
 
  The Company was incorporated under the laws of the State of California in
1929 and provides telecommunications services in southern and central
California, Nevada and Arizona. All of the common stock of the Company,
constituting approximately 99.6% of the total voting stock, is owned by GTE
Corporation ("GTE"). The Company has one wholly-owned subsidiary, Contel
Advance Systems, Inc., which markets telecommunications customer premise
equipment and other products and services. The Company's principal executive
offices are located at 600 Hidden Ridge, Irving, Texas 75038, telephone number
(972) 718-5600.
 
                                       2
<PAGE>
 
                                USE OF PROCEEDS
 
  The net proceeds from the offering and sale of the New Debentures, exclusive
of accrued interest, will be applied (A) toward the repayment of short-term
borrowings incurred (i) in connection with the redemption on May 1, 1997 of
(a) the Company's 7.48% Cumulative Preferred Stock in the amount (including
premium) of $32,822,623 and (b) the following series of first mortgage bonds
of the Company:
 
<TABLE>
<CAPTION>
                                                                      TOTAL
                                       OUTSTANDING                  PRINCIPAL
                            ORIGINAL    PRINCIPAL      PREMIUM     AND PREMIUM
                 INTEREST   MATURITY    AMOUNT AT      PAID AT          AT
       SERIES      RATE       DATE      REDEMPTION    REDEMPTION    REDEMPTION
       ------    --------   --------   ------------   ----------   ------------
       <S>       <C>        <C>        <C>            <C>          <C>
       T          6.750%     12/1/97   $ 55,000,000         --     $ 55,000,000
        U         7.125%     12/1/98     60,000,000    $150,000      60,150,000
        X         7.625%     12/1/01     50,000,000     525,000      50,525,000
        J         7.625%    12/31/97     10,000,000         --       10,000,000
                                       ------------    --------    ------------
                                       $175,000,000    $675,000    $175,675,000
                                       ============    ========    ============
</TABLE>
 
and (ii) for the purpose of financing the Company's construction program and
(B) for general corporate purposes. At November 30, 1997, the Company had
short-term borrowings exclusive of current maturities of approximately
$150,296,000 at an annual average interest rate of 5.81%. The Company's
construction budget was approximately $625,000,000 for 1997, approximately
$530,054,000 of which was incurred through November 30, 1997, principally for
central office equipment, outside plant and land and buildings. The balance of
the funds for the completion of the 1997 construction program was obtained
primarily from internal sources and short-term loans. The Company's
construction budget is currently estimated at approximately $573,000,000 for
1998.
 
               CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
 
<TABLE>
<CAPTION>
                                  NINE MONTHS ENDED YEARS ENDED DECEMBER 31,
                                    SEPTEMBER 30,   ---------------------------
                                        1997        1996 1995 1994 1993    1992
                                  ----------------- ---- ---- ---- ----    ----
                                     (UNAUDITED)
<S>                               <C>               <C>  <C>  <C>  <C>     <C>
Consolidated Ratios of Earnings
 to Fixed Charges(a).............       8.38        8.06 5.33 7.37 2.77(b) 6.15
</TABLE>
- --------
(a) Computed as follows: (1) "earnings" have been calculated by adding income
    taxes and fixed charges to income before extraordinary charge; (2) "fixed
    charges" include interest expense and the portion of rentals representing
    interest.
 
(b) Results for 1993 include an after-tax restructuring charge of
    approximately $304,400,000 for the implementation of a re-engineering plan
    and a one-time, after-tax charge of approximately $23,000,000 related to
    the enhanced early retirement and voluntary separation programs offered to
    eligible employees in 1993. Excluding these items, the consolidated ratio
    of earnings to fixed charges for the year ended December 31, 1993 would
    have been 6.45.
 
                              THE NEW DEBENTURES
 
  The New Debentures are to be issued as one or more series of the Company's
debentures (the "Debentures") under an Indenture, dated as of December 1,
1993, as amended and supplemented by the First Supplemental Indenture dated as
of April 15, 1996 (as amended and supplemented, the "Indenture"), between the
Company and First Trust of California, National Association, as successor
trustee to Bank of America National Trust and Savings Association (the
"Trustee"). By resolution of the Board of Directors of the Company or a
certificate of authorized officers of the Company pursuant to such a
resolution, the Company will designate the title of each series, aggregate
principal amount, date or dates of maturity, dates for payment and rate of
interest, redemption dates, prices, obligations and restrictions, if any, and
any other terms with respect to each
 
                                       3
<PAGE>
 
such series. The following summary does not purport to be complete and is
subject in all respects to the provisions of, and is qualified in its entirety
by express reference to, the cited Articles and Sections of the Indenture and
the form of New Debenture, which are filed as exhibits to the Registration
Statement of which this Prospectus is a part, or incorporated by reference
therein.
 
FORM AND EXCHANGE
 
  Unless issued in the form of a Global Debenture as described under "Book-
Entry, Delivery and Form" below, the New Debentures are to be issued in
registered form only in denominations of $1,000 and integral multiples thereof
and will be exchangeable for New Debentures of the same series of other
denominations of a like aggregate principal amount without charge except for
reimbursement of taxes, if any. (ARTICLE TWO)
 
MATURITY, INTEREST AND PAYMENT
 
  Information concerning the maturity, interest rate and payment dates of each
series of the New Debentures will be contained in a Prospectus Supplement
relating to that series of New Debentures.
 
REDEMPTION PROVISIONS, SINKING FUND AND DEFEASANCE
 
  Each series of the New Debentures may be redeemed upon not less than 30 days
notice at the redemption prices and subject to the conditions that will be set
forth in a Prospectus Supplement relating to that series of New Debentures.
(ARTICLE THREE) If a sinking fund is established with respect to any series of
the New Debentures, a description of the terms of such sinking fund will be
set forth in a Prospectus Supplement relating to that series of New
Debentures. The Indenture provides that each series of the New Debentures is
subject to defeasance. (SECTION 11.02)
 
BOOK-ENTRY, DELIVERY AND FORM
 
  If a Prospectus Supplement specifies that any series of New Debentures will
be issued in the form of one or more registered global certificates (for each
such series, collectively, the "Global Debenture"), unless otherwise specified
in such Prospectus Supplement, the Global Debenture will be deposited with, or
on behalf of, The Depository Trust Company (the "Depository") and registered
in the name of the Depository's nominee. Except as set forth below, the Global
Debenture may be transferred, in whole but not in part, only to another
nominee of the Depository or to a successor of the Depository or its nominee.
 
  The Depository has advised as follows: It is a limited-purpose trust company
which was created to hold securities for its participants and facilitate the
clearance and settlement of securities transactions between participants in
such securities through electronic book-entry changes in accounts of its
participants. Participants include securities brokers and dealers (including
the underwriters or dealers named in the Prospectus Supplement relating to the
New Debentures), banks and trust companies, clearing corporations and certain
other organizations. Access to the Depository's system is also available to
others such as banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a participant, either directly or
indirectly ("indirect participants"). Persons who are not participants may
beneficially own securities held by the Depository only through participants
or indirect participants.
 
  The Depository has advised that pursuant to procedures established by it (i)
upon issuance of the New Debentures by the Company, the Depository will credit
the accounts of the participants designated by the underwriters or dealers
with the principal amounts of the New Debentures purchased by the underwriters
or dealers and (ii) ownership of beneficial interests in the Global Debenture
will be shown on, and the transfer of that ownership will be effected only
through, records maintained by the Depository (with respect to participants'
interests) or by the participants and indirect participants (with respect to
the owners of beneficial interests in the Global Debenture). The laws of some
states require that certain persons take physical delivery in definitive form
of securities which they own. Consequently, the ability to transfer beneficial
interests in the Global Debenture is limited to such extent.
 
                                       4
<PAGE>
 
  So long as the Depository's nominee is the registered owner of the Global
Debenture, such nominee for all purposes will be considered the sole owner or
holder of the New Debentures. Except as provided below, owners of beneficial
interests in the Global Debenture will not be entitled to have any of the New
Debentures registered in their names and will not receive or be entitled to
receive physical delivery of the New Debentures in definitive form.
 
  Neither the Company, the Trustee, any paying agent of the Company nor the
Depository will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in the Global Debenture, or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
 
  Principal and interest payments on the New Debentures registered in the name
of the Depository's nominee will be made to the Depository's nominee as the
registered owner of the Global Debenture. The Company and the Trustee will
treat the persons in whose names the New Debentures are registered as the
owners of such New Debentures for the purpose of receiving payment of
principal and interest on the New Debentures and for all other purposes
whatsoever. Therefore, neither the Company, the Trustee nor any paying agent
of the Company will have any direct responsibility or liability for the
payment of principal and interest on the New Debentures to owners of
beneficial interests in the Global Debenture. The Depository has advised the
Company and the Trustee that its present practice is, upon receipt of any
payment of principal and interest, to immediately credit the accounts of the
participants with such payment in amounts proportionate to their respective
holdings in principal amount of beneficial interests in the Global Debenture
as shown in the records of the Depository. Payments by participants and
indirect participants to owners of beneficial interests in the Global
Debenture will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers in
bearer form or registered in "street name," and will be the responsibility of
the participants or indirect participants.
 
  If the Depository is at any time unwilling or unable to continue as
depository with respect to an outstanding series of New Debentures or if at
any time the Depository shall no longer be registered or in good standing
under the Exchange Act or other applicable statute and a successor depository
is not appointed by the Company within 90 days, the Company will issue New
Debentures in definitive form in exchange for the Global Debenture. In
addition, the Company may at any time determine not to have an outstanding
series of New Debentures represented by a Global Debenture. In either
instance, an owner of a beneficial interest in the Global Debenture will be
entitled to have New Debentures equal in principal amount to such beneficial
interest registered in its name and will be entitled to physical delivery of
such New Debentures in definitive form. New Debentures so issued in definitive
form will be issued in denominations of U.S. $1,000 and integral multiples
thereof and will be issued in registered form only, without coupons.
 
RESTRICTIONS
 
  The New Debentures will not be secured. The Indenture provides, however,
that if the Company shall at any time mortgage or pledge any of its property,
the Company will secure the New Debentures, equally and ratably with the other
indebtedness or obligations secured by such mortgage or pledge, so long as
such other indebtedness or obligations shall be so secured. There are certain
exceptions to the foregoing, among them that the Debentures need not be
secured:
 
    (i) in the case of (a) purchase money mortgages, (b) conditional sales
  agreements or (c) mortgages existing at the time of purchase, on property
  acquired after the date of the Indenture;
 
    (ii) with respect to certain deposits or pledges to secure the
  performance of bids, tenders, contracts or leases or in connection with
  worker's compensation and similar matters;
 
    (iii) with respect to mechanics' and similar liens in the ordinary course
  of business;
 
                                       5
<PAGE>
 
    (iv) with respect to the Company's first mortgage bonds outstanding on
  the date of the Indenture, issued and secured by the Company and its
  predecessors in interest under various security instruments, all of which
  have been assumed by the Company (collectively, the "First Mortgage
  Bonds"), and any replacement or renewal (without increase in principal
  amount or extension of final maturity date) of such outstanding First
  Mortgage Bonds;
 
    (v) with respect to First Mortgage Bonds which may be issued by the
  Company in connection with the consolidation or merger of the Company with
  or into certain affiliates of the Company in exchange for or otherwise in
  substitution for long-term senior indebtedness of any such affiliate
  ("Affiliate Debt") which by its terms (x) is secured by a mortgage on all
  or a portion of the property of such affiliate, (y) prohibits long-term
  senior secured indebtedness from being incurred by such affiliate, or a
  successor thereto, unless the Affiliate Debt shall be secured equally and
  ratably with such long-term senior secured indebtedness or (z) prohibits
  long-term senior secured indebtedness from being incurred by such
  affiliate; or
 
    (vi) with respect to indebtedness required to be assumed by the Company
  in connection with the merger or consolidation of certain affiliates of the
  Company with or into the Company. (SECTION 4.05)
 
  The Indenture does not limit the amount of debt securities which may be
issued or the amount of debt which may be incurred by the Company. (SECTION
2.01) However, while the restriction in the Indenture described above would
not afford holders of the New Debentures protection in the event of a highly
leveraged transaction in which unsecured indebtedness was incurred, the
issuance of most debt securities by the Company, including the New Debentures,
does require state regulatory approval (which may or may not be granted). In
addition, in the event of a highly leveraged transaction in which secured
indebtedness was incurred, the above restriction would require the New
Debentures to be secured equally and ratably with such secured indebtedness,
subject to the exceptions described above. It is unlikely that a leveraged
buyout initiated or supported by the Company, the management of the Company or
an affiliate of either party would occur, because all of the common stock of
the Company, constituting approximately 99.6% of the total voting stock, is
owned by GTE, which has no current intention of selling its ownership in the
Company.
 
MODIFICATIONS OF INDENTURE
 
  The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of not less than a majority in aggregate
principal amount of the Debentures of any series at the time outstanding and
affected by such modification, to modify the Indenture or any supplemental
indenture affecting that series of the Debentures or the rights of the holders
of that series of Debentures. However, no such modification shall (i) extend
the fixed maturity of any Debenture, or reduce the principal amount thereof,
or reduce the rate or extend the time of payment of interest thereon, or
reduce any premium payable upon the redemption thereof, without the consent of
the holder of each Debenture so affected, or (ii) reduce the aforesaid
percentage of Debentures, the holders of which are required to consent to any
such supplemental indenture, without the consent of each holder of Debentures
then outstanding and affected thereby. (SECTION 9.02)
 
  The Company and the Trustee may execute, without the consent of any holder
of Debentures, any supplemental indenture for certain other usual purposes
including the creation of any new series of Debentures. (SECTIONS 2.01, 9.01
and 10.01)
 
EVENTS OF DEFAULT
 
  The Indenture provides that the following described events constitute
"Events of Default" with respect to each series of the Debentures thereunder:
(a) failure for 30 business days to pay interest on the Debentures of that
series when due; (b) failure to pay principal or premium, if any, on the
Debentures of that series when due, whether at maturity, upon redemption, by
declaration or otherwise, or to make any sinking fund payment with respect to
that series; (c) failure to observe or perform any other covenant (other than
those specifically relating to another series) in the Indenture for 90 days
after notice with respect thereto; or (d) certain events in bankruptcy,
insolvency or reorganization. (SECTION 6.01)
 
                                       6
<PAGE>
 
  The holders of a majority in aggregate outstanding principal amount of any
series of the Debentures have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee for that
series. (SECTION 6.06) The Trustee or the holders of not less than 25% in
aggregate outstanding principal amount of any particular series of the
Debentures may declare the principal due and payable immediately upon an Event
of Default with respect to such series, but the holders of a majority in
aggregate outstanding principal amount of such series may rescind and annul
such declaration and waive the default if the default has been cured and a sum
sufficient to pay all matured installments of interest and principal and any
premium has been deposited with the Trustee. (SECTION 6.01)
 
  The holders of a majority in aggregate outstanding principal amount of any
series of the Debentures may, on behalf of the holders of all the Debentures
of such series, waive any past default except a default in the payment of
principal, premium, if any, or interest. (SECTION 6.06) The Company is
required to file annually with the Trustee a certificate as to whether or not
the Company is in compliance with all the conditions and covenants under the
Indenture. (SECTION 5.03)
 
CONCERNING THE TRUSTEE
 
  The Trustee, prior to an Event of Default, undertakes to perform only such
duties as are specifically set forth in the Indenture and, after the
occurrence of an Event of Default, shall exercise the same degree of care as a
prudent individual would exercise in the conduct of his own affairs. (SECTION
7.01) Subject to such provision, the Trustee is under no obligation to
exercise any of the powers vested in it by the Indenture at the request of any
holders of Debentures, unless offered reasonable security or indemnity by such
security holders against the costs, expenses and liabilities which might be
incurred thereby. (SECTION 7.02) The Trustee is not required to expend or risk
its own funds or incur personal financial liability in the performance of its
duties if the Trustee reasonably believes that repayment or adequate indemnity
is not reasonably assured to it. (SECTION 7.01)
 
                                    EXPERTS
 
  The financial statements, schedule and exhibit pertaining to the Company's
Statements re: Calculation of Consolidated Ratio of Earnings to Fixed Charges
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1996, which are incorporated by reference in this Prospectus,
have been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their report with respect thereto, and are incorporated herein in
reliance upon the authority of said firm as experts in giving said report.
Reference is made to said report on the financial statements of the Company,
which includes an explanatory paragraph with respect to the discontinuance of
the provisions of Statement of Financial Accounting Standards No. 71,
"Accounting for the Effects of Certain Types of Regulation," as discussed in
Note 2 to the financial statements.
 
                             CERTAIN LEGAL MATTERS
 
  The validity of the New Debentures will be passed upon for the Company by
William G. Mundy, Esq., Vice President--General Counsel of the Company.
Certain legal matters in connection with the New Debentures will be passed
upon for the underwriters, agents, or institutional purchasers by Milbank,
Tweed, Hadley & McCloy of New York, New York.
 
                                       7
<PAGE>
 
                             PLAN OF DISTRIBUTION
 
  The Company may sell any series of the New Debentures in one or more of the
following ways: (i) to underwriters for resale to the public or to
institutional purchasers; (ii) directly to institutional purchasers; or
(iii) through Company agents to the public or to institutional purchasers. The
Prospectus Supplement with respect to each series of New Debentures will set
forth the terms of the offering of such New Debentures, including the name or
names of any underwriters or agents, the purchase price of such New Debentures
and the proceeds to the Company from such sale, any underwriting discounts or
agency fees and other items constituting underwriters' or agents'
compensation, any initial public offering price, any discounts or concessions
allowed or reallowed or paid to dealers and any securities exchanges on which
such New Debentures may be listed.
 
  If underwriters are used in the sale, such New Debentures will be acquired
by the underwriters for their own account and may be resold from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
 
  Unless otherwise set forth in the Prospectus Supplement, the obligations of
the underwriters to purchase any series of New Debentures will be subject to
certain conditions precedent and the underwriters will be obligated to
purchase all such New Debentures if any are purchased. In the event of a
default of one or more of the underwriters involving not more than 10% of the
aggregate principal amount of the New Debentures offered for sale, the non-
defaulting underwriters would be required to purchase the New Debentures
agreed to be purchased by such defaulting underwriter or underwriters. In the
event of a default in excess of 10% of the aggregate principal amount of the
New Debentures, the Company may, at its option, sell less than all the New
Debentures offered.
 
  Underwriters and agents may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act of 1933, as
amended, or to contribution with respect to payments which the underwriters or
agents may be required to make in respect thereof. Underwriters and agents may
be customers of, engage in transactions with, or perform services for, the
Company in the ordinary course of business.
 
                                       8
<PAGE>
 
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
 
  NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS, AND, IF
GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFERING BY THE COMPANY OR ANY DEALER IN
ANY JURISDICTION IN WHICH SUCH OFFERING MAY NOT BE LAWFULLY MADE.
 
 
                               ----------------
 
 
                               TABLE OF CONTENTS
 
<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
Statement of Available Information.........................................   2
Incorporation of Certain Documents by Reference............................   2
The Company................................................................   2
Use of Proceeds............................................................   3
Consolidated Ratios of Earnings to Fixed Charges...........................   3
The New Debentures.........................................................   3
Experts....................................................................   7
Certain Legal Matters......................................................   7
Plan of Distribution.......................................................   8
</TABLE>
 
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

                      [LOGO] GTE CALIFORNIA INCORPORATED
 
 
                               ----------------
 
                                  PROSPECTUS
 
                               ----------------
 
 
 
 
 
                                        , 1998
 
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
 
                                    PART II
 
                    INFORMATION NOT REQUIRED IN PROSPECTUS
 
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
 
  The following is a statement of estimated expenses in connection with the
issuance and distribution of the securities being registered, other than
underwriting discounts and commission.
 
<TABLE>
   <S>                                                               <C>
   1. Registration fee.............................................. $ 88,500.00
   2. Trustee's fees................................................    3,200.00
   3. Cost of printing..............................................   40,000.00
   4. Accounting fees...............................................   26,000.00
   5. Miscellaneous.................................................   10,300.00
                                                                     -----------
                                                                     $168,000.00
                                                                     ===========
</TABLE>
 
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
 
  Pursuant to Section 317 of the California Corporations Code (the "CCC"), a
corporation may indemnify its directors and officers by reason of service in
such capacities against expenses, judgments, fines, settlements and other
amounts actually and reasonably incurred in connection with any proceeding to
which the director or officer was or is a party or is threatened to be made a
party; provided, however, the director or officer has acted in good faith and
in a manner reasonably believed to be in the best interests of the
corporation. With respect to any criminal proceedings, the director or officer
must have had no reasonable cause to believe that his or her conduct was
unlawful. In actions by, or in the right of, a corporation, no indemnification
is available for expenses incurred with respect to a pending action settled or
disposed of without court approval or with respect to any claim, issue or
matter as to which such director or officer is adjudged liable unless, and
only to the extent that, it is determined upon application in the court
adjudicating the proceeding that, in view of all of the circumstances in the
case, such person is fairly and reasonably entitled to indemnity for such
expenses. Indemnification against reasonable expenses incurred is mandatory to
the extent the director or officer is successful in defense of the proceeding
or any claim, issue or matter therein. In cases where the director or officer
is not successful, indemnification must be approved by the court adjudicating
the proceeding or by the corporation acting through its shareholders,
disinterested directors or independent legal counsel.
 
  The indemnification provided as set forth above is not exclusive and a
corporation may, under the CCC, grant additional rights to indemnification;
provided, however, that in cases where directors or officers breach their duty
to the corporation or its stockholders such indemnification may not limit the
liability of directors or officers (i) for acts or omissions that involve
intentional misconduct or a knowing and culpable violation of law, (ii) for
acts or omissions believed to be contrary to the best interests of the
corporation or its shareholders or that involve the absence of good faith,
(iii) for any transaction from which the director or officer derived an
improper personal benefit, (iv) for acts or omissions that show a reckless
disregard for the duty to the corporation or its shareholders in circumstances
in which the director or officer was aware, or should have been aware, in the
ordinary course of performing his or her duties, of a risk of serious injury
to the corporation or its shareholders, (v) for acts or omissions that
constitute an unexcused pattern of inattention that amounts to an abdication
of the duty to the corporation or its shareholders, (vi) in actions arising
out of contracts in which the director or officer has a material financial
interest or (vii) for claims arising from corporate actions which subject
directors to joint and several liability under Section 316 of the CCC.
 
  As permitted by the CCC, the Company's By-laws provide for indemnification
of directors and officers in accordance with the foregoing standards, provided
such persons have acted in accordance with such standards. The Company also
has insurance policies, as permitted by the CCC, on behalf of its directors
and officers against certain liabilities which might be incurred by them in
such capacities.
 
                                     II-1
<PAGE>
 
ITEM 16. EXHIBITS.
 
  See Exhibit Index on Page E-1.
 
ITEM 17. UNDERTAKINGS.
 
  The Company hereby undertakes that, for the purpose of determining any
liability under the Securities Act of 1933, as amended (the "Act"), each
filing of the Company's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
 
  Insofar as indemnification for liabilities arising under the Act may be
permitted to officers, directors and controlling persons of the Company
pursuant to any charter provision, by-law or otherwise, the Company has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than payment by the Company of expenses
incurred or paid by an officer, director or controlling person of the Company
in the successful defense of any action, suit or proceeding) is asserted by
such officer, director or controlling person in connection with the securities
being registered, the Company will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
 
  The Company hereby undertakes:
 
  (1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
 
    (i) To include any prospectus required by Section 10(a)(3) of the Act;
 
    (ii) To reflect in the prospectus any facts or events arising after the
  effective date of the registration statement (or the most recent post-
  effective amendment thereof) which, individually or in the aggregate,
  represent a fundamental change in the information set forth in the
  registration statement. Notwithstanding the foregoing, any increase or
  decrease in volume of securities offered (if the total dollar value of
  securities offered would not exceed that which was registered) and any
  deviation from the low or high and of the estimated maximum offering range
  may be reflected in the form of prospectus filed with the Commission
  pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
  price represent no more than a 20 percent change in the maximum aggregate
  offering price set forth in the "Calculation of Registration Fee" table in
  the effective registration statement.
 
    (iii) To include any material information with respect to the plan of
  distribution not previously disclosed in the registration statement or any
  material change to such information in the registration statement;
  provided, however, that paragraphs (i) and (ii) shall not apply if the
  information required to be included in a post-effective amendment by those
  paragraphs is contained in periodic reports filed by the Company pursuant
  to Section 13 or Section 15(d) of the Exchange Act that are incorporated by
  reference in the registration statement.
 
  (2) That, for the purpose of determining any liability under the Act, each
such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
 
  (3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
 
                                     II-2
<PAGE>
 
                                  SIGNATURES
 
  Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Irving, State of Texas, on the 20th day of
February, 1998.
 
                                          GTE CALIFORNIA INCORPORATED
                                                   (Registrant)
 
                                                      DAVID R. BOWMAN
                                          By: _________________________________
                                                      David R. Bowman
                                                         President
 
  Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement is signed below by the following persons in the
capacities and on the dates indicated.
 
<TABLE>
<CAPTION>
             SIGNATURE                           TITLE                   DATE
             ---------                           -----                   ----
 
<S>                                  <C>                           <C>
          DAVID R. BOWMAN            President (Principal           February 20, 1998
____________________________________  Executive Officer)
          David R. Bowman
 
         GERALD K. DINSMORE          Senior Vice President--        February 20, 1998
____________________________________  Finance and Planning
         Gerald K. Dinsmore           (Principal Financial
                                      Officer)
 
      WILLIAM M. EDWARDS, III        Vice President--Controller     February 20, 1998
____________________________________  (Principal Accounting
      William M. Edwards, III         Officer)
 
       MATELAND L. KEITH, JR.        Director                       February 20, 1998
____________________________________
       Mateland L. Keith, Jr.
 
           JOHN C. APPEL             Director                       February 20, 1998
____________________________________
           John C. Appel
 
          WILLIAM G. MUNDY           Director                       February 20, 1998
____________________________________
          William G. Mundy
 
        LAWRENCE R. WHITMAN          Director                       February 20, 1998
____________________________________
        Lawrence R. Whitman

</TABLE>
 
 
 
                                     II-3
<PAGE>
 
                   CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
 
  As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-3 of our reports, dated
January 28, 1997, included in the GTE California Incorporated Form 10-K for
the year ended December 31, 1996 and to all references to our Firm included in
this Registration Statement.
 
                                          ARTHUR ANDERSEN LLP
 
Dallas, Texas
February 18, 1998
 
 
                                     II-4
<PAGE>
 
                                 EXHIBIT INDEX
 
<TABLE>
<CAPTION>
 EXHIBIT
 NUMBER
 -------
 <C>     <S>
  1.1    Form of Purchase Agreement, including Standard Purchase Agreement
         Provisions (February 1998 Edition).

  4.1    Indenture between GTE California Incorporated and Bank of America
         National Trust and Savings Association, as Trustee, dated as of
         December 1, 1993 (incorporated by reference from Exhibit 4.1 to GTE
         California Incorporated's Registration Statement on Form S-3,
         File No. 33-51541, filed with the Securities and Exchange Commission
         on December 17, 1993), as amended and supplemented by the First
         Supplemental Indenture dated as of April 15, 1996 between GTE
         California Incorporated and First Trust of California, National
         Association, as Trustee (as successor trustee to Bank of America
         National Trust and Savings Association) (incorporated by reference
         from Exhibit 4.3 to GTE California Incorporated's Current Report on
         Form 8-K dated April 23, 1996).

  4.2    Form of New Debenture.

  5      Opinion and consent of William G. Mundy, Esq.

 12      Consolidated Statements of the Ratio of Earnings to Fixed Charges
         (contained in Exhibit 12 to GTE California Incorporated's Report on
         Form 10-Q for the quarter ended September 30, 1997 and Exhibit 12 to
         GTE California Incorporated's Report on Form 10-K for year ended
         December 31, 1996).

 23.1    Consent of Arthur Andersen LLP is included on page II-4 of this
         Registration Statement.

 23.2    Consent of William G. Mundy, Esq. (contained in opinion filed as
         Exhibit 5).

 25      Form T-1 Statement of Eligibility under the Trust Indenture Act of
         1939, as amended, of First Trust of California, National Association,
         as successor trustee to Bank of America National Trust and Savings
         Association under the Indenture incorporated by reference in Exhibit
         4.1.

 26.1    Form of Invitation for Bids.
</TABLE>

<PAGE>
 
                                                   Exhibit 1.1

                          GTE CALIFORNIA INCORPORATED


                               PURCHASE AGREEMENT



          GTE California Incorporated, a California corporation (the "Company"),
proposes to issue and sell $___,000,000 aggregate principal amount of its ___%
Debentures, Series __, Due ____ (the "New Debentures"). Subject to the terms and
conditions set forth or incorporated by reference herein, the Company agrees to
sell and the purchaser or purchasers named in Schedule A attached hereto (the
"Purchasers") severally agree to purchase the New Debentures at __% of their
principal amount, plus accrued interest from ______________ to the date of
payment for the New Debentures and delivery thereof.  Interest on the New
Debentures will be payable semi-annually on ___________ and ___________,
commencing _________.  The New Debentures will be reoffered to the public at
____% of their principal amount.

          All the provisions contained in the Company's Standard Purchase
Agreement Provisions (February 1998 Edition) (the "Standard Purchase Agreement
Provisions") annexed hereto shall be deemed to be a part of this Purchase
Agreement to the same extent as if such provisions had been set forth in full
herein.

REDEMPTION PROVISIONS:

          [The New Debentures will not be redeemable prior to maturity.]

                                       OR

          [The New Debentures will not be redeemable prior to _____.
Thereafter, the New Debentures will be redeemable on not less 30 nor more than
60 days' notice given as provided in the Indenture, as a whole or in part, at
the option of the Company at the redemption price set forth below.  The "initial
regular redemption price" will be the initial public offering price as defined
below plus the rate of interest on the New Debentures.  The redemption price
during the twelve month period beginning ________ and during the twelve month
periods beginning on each ____________ thereafter through the twelve month
period ended ____________ will be determined by reducing the initial regular
redemption price by an amount determined by multiplying (a) 1/_ of the amount by
which such initial regular redemption price exceeds 100% by (b) the number of
such full twelve month periods which shall have elapsed between ___________ and
the date fixed for redemption; and thereafter the redemption prices during the
twelve month periods beginning ____________ shall be 100%; provided, however,
that all such prices will be specified to the nearest 0.01% or if there is no
nearest 0.01%, then to the next higher 0.01%.

          For the purpose of determining the redemption prices of the New
Debentures, the initial public offering price of the New Debentures shall be the
price, expressed in percentage of principal amount (exclusive of accrued
interest), at which the New Debentures are to be initially offered for sale to
          
<PAGE>
 
                                      -2-


the public; if there is not a public offering of the New Debentures, the
initial public offering price of the New Debentures shall be deemed to be the
price, expressed in percentage of principal amount (exclusive of accrued
interest), to be paid to the Company by the Purchasers.]

CLOSING:

          The Purchasers agree to pay for the New Debentures, at the option of
the Company, by certified or official bank check or checks or by wire transfer
in each case in same day funds, upon delivery of such New Debentures at 10:00
A.M. (New York City time) on _____________ (the "Closing Date") or at such other
time, not later than the seventh full business day thereafter, as shall be
agreed upon by the Company and the Purchasers or the firm or firms designated as
the representative or representatives, as the case may be, of the Purchasers
(the "Representative").  The Company shall advise the Representative not later
than the business day immediately preceding the Closing Date of its decision
whether to accept payment for the New Debentures by certified or official bank
check or by wire transfer and, if the Company chooses to accept payment by wire
transfer, the Company shall provide the Representative on such date immediately
preceding the Closing Date with the appropriate wire transfer instructions.

DENOMINATION OF THE NEW DEBENTURES:

          [The New Debentures shall be in the form of temporary or definitive
fully-registered New Debentures in denominations of One Thousand Dollars
($1,000) or any integral multiple thereof, registered in such names as the
Purchasers or the Representative shall request not less than two business days
before the Closing Date.  The Company agrees to make the New Debentures
available to the Purchasers or the Representative for inspection at the office
of First Trust of California, National Association, Los Angeles, California or
The Depository Trust Company, New York, New York, at least twenty-four hours
prior to the time fixed for the delivery of the New Debentures on the Closing
Date.]

                                       OR

          [The New Debentures shall be in the form of one or more Global
Debentures which shall represent, and shall be denominated in an amount equal to
the aggregate principal amount of, the New Debentures and shall be registered in
the name of The Depository Trust Company or its nominee.  The Company agrees to
make the New Debentures available to the Purchasers or the Representative for
inspection at the office of First Trust of California, National Association, Los
Angeles, California or The Depository Trust Company, New York, New York, at
least twenty-four hours prior to the time fixed for the delivery of the New
Debentures on the Closing Date.]
<PAGE>
 
                                      -3-


RESALE:

          [The Purchasers represent that they intend to resell the New
Debentures, and therefore the provisions applicable to Reselling Purchasers in
the Standard Purchase Agreement Provisions will be applicable.]

                                      OR

          [The Purchasers represent that they do not intend to resell the New
Debentures, and therefore the provisions applicable to Reselling Purchasers in
the Standard Purchase Agreement Provisions will not be applicable.]


           In witness whereof, the parties have executed this Purchase Agreement
this _____ day of __________, _____.

                              [Names of Purchasers or
                              Representative]


                              By: ___________________________
                                  Title:


                              GTE CALIFORNIA INCORPORATED


                              By: ___________________________
                                  Vice President
<PAGE>
 
                                   SCHEDULE A


          The names of the Purchasers and the principal amount of New Debentures
which each respectively agrees to purchase are as follows:

                                 Principal
                                  Amount
                                  of New
Name                            Debentures
- ----                                      
                                ____________
 
                                $___,000,000





                               ______________


Total........................   $___,000,000
<PAGE>
 
                          GTE CALIFORNIA INCORPORATED



                     STANDARD PURCHASE AGREEMENT PROVISIONS

                            (February 1998 Edition)
<PAGE>
 
          GTE California Incorporated, a California corporation (the "Company"),
may enter into one or more purchase agreements providing for the sale of
debentures to the purchaser or purchasers named therein (the "Purchasers").  The
standard provisions set forth herein will be incorporated by reference in any
such purchase agreement ("Purchase Agreement").  The Purchase Agreement,
including these Standard Purchase Agreement Provisions incorporated therein by
reference, is hereinafter referred to as "this Agreement".  Unless otherwise
defined herein, terms used in this Agreement that are defined in the Purchase
Agreement have the meanings set forth therein.

                           I.  SALE OF THE DEBENTURES

          The Company proposes to issue one or more series of debentures
pursuant to the provisions of an Indenture dated as of December 1, 1993, as
amended and supplemented by the First Supplemental Indenture dated as of April
15, 1996 (as amended and supplemented, the "Indenture"), between the Company and
First Trust of California, National Association, as successor trustee to Bank of
America National Trust and Savings Association (the "Trustee").  In a
supplemental indenture to the Indenture, a resolution of the Board of Directors
of the Company or an officers' certificate pursuant to a supplemental indenture
or board resolution specifically authorizing each new series of debentures, the
Company will designate the title of each new series of debentures, and the
aggregate principal amount, date or dates of maturity, dates for payment and
rate of interest, redemption dates, prices, obligations and restrictions, if
any, and any other terms with respect to each such series.

          The Company has filed with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Act"),
registration statement No. 333-_____ relating to $300,000,000 of the Company's
debentures registered thereunder and $100,000,000 of the Company's debentures
registered under Registration Statement No. 333-01001 (the amount remaining
unsold thereunder, from time to time, is hereinafter referred to as the
"Debentures"), including a prospectus which, pursuant to Rule 429 under the Act,
relates to the Debentures, and has filed with, or transmitted for filing to, the
Commission (or will promptly after the sale so file or transmit for filing) a
prospectus supplement specifically relating to a particular series of Debentures
(such particular series being hereinafter referred to as the "New Debentures")
pursuant to Rule 424(b) under the Act ("Rule 424(b)"). The term "Registration
Statement" means the registration statement referred to herein, as amended to
the date of the Purchase Agreement. The term "Basic Prospectus" means the
prospectus relating to the Debentures included in the Registration Statement.
The term "Prospectus" means the Basic Prospectus together with the prospectus
supplement specifically relating to the New Debentures, as filed with, or
transmitted for filing to, the Commission pursuant to Rule 424(b). As used
herein, the terms "Registration Statement", "Basic Prospectus" and "Prospectus"
shall include in each case the material, if any, incorporated by reference
therein.

                  II.  PURCHASERS' REPRESENTATIONS AND RESALE

          Each Purchaser represents and warrants that information furnished in
writing to the Company expressly for use with respect to the New Debentures will
not contain any untrue statement of a material fact and will not omit any
material fact in connection with such information necessary to make such
information not misleading.
<PAGE>
 
                                      -2-

          If the Purchasers advise the Company in the Purchase Agreement that
they intend to resell the New Debentures, the Company will assist the Purchasers
as hereinafter provided.  The terms of any such resale will be set forth in the
Prospectus.  The provisions of Paragraphs C and D of Article VI and Articles
VIII, IX and X of this Agreement apply only to Purchasers that have advised the
Company of their intention to resell the New Debentures ("Reselling
Purchasers").  All other provisions apply to any Purchaser including a Reselling
Purchaser.

                                 III.  CLOSING

          The closing will be held at the office of GTE Service Corporation, 4th
Floor, One Stamford Forum, Stamford, Connecticut 06904 on the Closing Date.
Concurrent with the delivery of the New Debentures to the Purchasers or to the
Representative for the account of each Purchaser, payment of the full purchase
price of the New Debentures shall be made, at the option of the Company, by
certified or official bank check or checks in same day funds, payable to the
Company or its order, at The Bank of New York, Attention: Corporate Trust
Department, or by wire transfer in same day funds to The Bank of New York for
the account of the Company.  Upon receipt of such check or wire transfer by The
Bank of New York, such check or wire transfer shall be deemed to be delivered at
the closing.

                   IV.  CONDITIONS TO PURCHASERS' OBLIGATIONS

          The respective obligations of the Purchasers hereunder are subject to
the following conditions:

          (A)  The Registration Statement shall have become effective and no
stop order suspending the effectiveness of the Registration Statement shall be
in effect, and no proceedings for such purpose shall be pending before or
threatened by the Commission; since the latest date as of which information is
given in the Registration Statement, there shall have been no material adverse
change in the business, business prospects, properties, financial condition or
results of operations of the Company; and the Purchasers or the Representative
shall have received on the Closing Date the customary form of compliance
certificate, dated the Closing Date and signed by the President or a Vice
President of the Company, including the foregoing.  The officer executing such
certificate may rely upon the best of his or her knowledge as to proceedings
pending or threatened.

          (B)  At the Closing Date, there shall be in full force and effect an
order or orders, satisfactory to counsel for the Purchasers, of the California
Public Utility Commission and of such other regulatory authorities, if any, as
may have jurisdiction over the issue and sale of the New Debentures by the
Company to the Purchasers, authorizing such issue and sale as herein and in the
Registration Statement provided, and none of such orders shall contain any
conditions inconsistent with the provisions of this Agreement or of the
Registration Statement.
<PAGE>
 
                                      -3-

          (C)  The Purchasers or the Representative shall have received on the
Closing Date an opinion of William G. Mundy, Esq., Vice President-General
Counsel of the Company, or other counsel to the Company satisfactory to the
Purchasers and counsel to the Purchasers, dated the Closing Date, substantially
in the form set forth in Exhibit A hereto.

          (D)  The Purchasers or the Representative shall have received on the
Closing Date an opinion of Milbank, Tweed, Hadley & McCloy, counsel for the
Purchasers, dated the Closing Date, substantially in the form set forth in
Exhibit B hereto.

          (E)  The Purchasers or the Representative shall have received on the
Closing Date a letter from Arthur Andersen LLP, independent public accountants
for the Company, dated as of the Closing Date, to the effect set forth in
Exhibit C hereto.

                    V.  CONDITIONS TO COMPANY'S OBLIGATIONS

          The obligations of the Company hereunder are subject to the following
conditions:

          (A)  The Registration Statement shall have become effective and no
stop order suspending the effectiveness of the Registration Statement shall be
in effect, and no proceedings for such purpose shall be pending before or
threatened by the Commission.

          (B)  At the Closing Date, there shall be in full force and effect an
order or orders, satisfactory to the Company, of the California Public Utility
Commission and of such other regulatory authorities, if any, as may have
jurisdiction over the issue and sale of the New Debentures by the Company to the
Purchasers.

          (C)  The Company shall have received on the Closing Date the full
purchase price of the New Debentures purchased hereunder.

                         VI.  COVENANTS OF THE COMPANY

          In further consideration of the agreements contained herein of the
Purchasers, the Company covenants to the several Purchasers as follows:

          (A)  To furnish to the Purchasers or the Representative a copy of the
Registration Statement including materials, if any, incorporated by reference
therein and, during the period mentioned in (C) below, to supply as many copies
of the Prospectus, any documents incorporated by reference therein and any
supplements and amendments thereto as the Purchasers or the Representative may
reasonably request.  The terms "supplement" and "amendment" or "amend" as used
in this Agreement shall include all documents filed by the Company with the
Commission subsequent to the effective date of the Registration Statement, or
the date of the Basic Prospectus, as the case may be, pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), which are deemed to be
incorporated by reference therein.
<PAGE>
 
                                      -4-

          (B)  Before amending or supplementing the Registration Statement or
the Prospectus with respect to the New Debentures, to furnish to any Purchaser
or the Representative, and to counsel for the Purchasers, a copy of each such
proposed amendment or supplement.

           The covenants in Paragraphs (C) and (D) apply only to Reselling
Purchasers:

          (C)  If in the period after the first date of resale of the New
Debentures during which, in the opinion of counsel for the Reselling Purchasers,
the Prospectus is required by law to be delivered, any event shall occur as a
result of which it is necessary to amend or supplement the Prospectus in order
to make a statement therein, in light of the circumstances when the Prospectus
is delivered to a subsequent purchaser, not materially misleading, or if it is
otherwise necessary to amend or supplement the Prospectus to comply with law,
forthwith to prepare and furnish, at its own expense (unless such amendment
shall relate to information furnished by the Purchasers or the Representative by
or on behalf of the Purchasers in writing expressly for use in the Prospectus),
to the Reselling Purchasers, the number of copies requested by the Reselling
Purchasers or the Representative of  either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in light of the circumstances when the Prospectus is
delivered to a subsequent purchaser, be misleading or so that the Prospectus
will comply with law.

          (D)  To use its best efforts to qualify the New Debentures for offer
and sale under the securities or Blue Sky laws of such jurisdictions as the
Purchasers or the Representative shall reasonably request and to pay all
expenses (including fees and disbursements of counsel) in connection therewith;
provided, however, that the Company, in complying with the foregoing provisions
of this paragraph, shall not be required to qualify as a foreign company or to
register or qualify as a broker or dealer in securities in any jurisdiction or
to consent to service of process in any jurisdiction other than with respect to
claims arising out of the offering or sale of the New Debentures, and provided
further that the Company shall not be required to continue the qualification of
the New Debentures beyond one year from the date of the sale of the New
Debentures.

              VII.  REPRESENTATIONS AND WARRANTIES OF THE COMPANY

          The Company represents and warrants to the several Purchasers that (i)
each document, if any, filed or to be filed pursuant to the Exchange Act and
incorporated by reference in the Basic Prospectus or the Prospectus complied or
will comply when so filed in all material respects with the Exchange Act and the
rules and regulations thereunder, (ii) each part of the Registration Statement
filed with the Commission pursuant to the Act relating to the New Debentures,
when such part became effective, did not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (iii) on the effective
date of the Registration Statement, the date the Prospectus is filed pursuant to
Rule 424(b) and at all times subsequent to and including the Closing Date, the
<PAGE>
 
                                      -5-

Registration Statement and the Prospectus, as amended or supplemented, if
applicable, complied or will comply in all material respects with the Act and
the applicable rules and regulations thereunder, (iv) on the effective date of
the Registration Statement, the Registration Statement did not contain, and as
amended or supplemented, if applicable, will not contain, any untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein not misleading, and on the date the Prospectus, or any
amendment or supplement thereto, is filed pursuant to Rule 424(b) and on the
Closing Date, the Prospectus will not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; except that these representations and warranties do not apply to
statements or omissions in the Registration Statement or the Prospectus based
upon information furnished to the Company by any Purchaser or the Representative
by or on behalf of any Purchaser in writing expressly for use therein or to
statements or omissions in the Statement of Eligibility of the Trustee under the
Indenture, (v) there are no legal or governmental proceedings required to be
described in the Prospectus which are not described as required, (vi) the
consummation of any transaction herein contemplated will not result in a breach
of any of the terms of any agreement or instrument to which the Company is a
party or any statute or any order, rule or regulation of any court or
governmental agency or body by which the Company is bound, and (vii) the
Indenture has been qualified under the Trust Indenture Act of 1939, as amended.

                             VIII.  INDEMNIFICATION

          The Company agrees to indemnify and hold harmless each Reselling
Purchaser and each person, if any, who controls such Reselling Purchaser within
the meaning of either Section 15 of the Act or Section 20 of the Exchange Act,
from and against any and all losses, claims, damages and liabilities based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement, the Basic Prospectus or the Prospectus (if used
within the period set forth in Paragraph (C) of Article VI hereof, and as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto), or based upon any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are based upon any such untrue statement or omission or
alleged untrue statement or omission based upon information furnished to the
Company by any Reselling Purchaser or the Representative by or on behalf of any
Reselling Purchaser in writing expressly for use therein or by any statement or
omission in the Statement of Eligibility of the Trustee under the Indenture.
The foregoing agreement, insofar as it relates to the Prospectus, shall not
inure to the benefit of any Reselling Purchaser (or to the benefit of any person
controlling such Reselling Purchaser) on account of any losses, claims, damages
or liabilities arising from the sale of any New Debentures by said Reselling
Purchaser to any person if a copy of the Prospectus (as amended or supplemented,
if prior to distribution of the Prospectus to the Reselling Purchaser, the
Company shall have made any supplements or amendments which have been furnished
to said Reselling Purchaser) shall not have been sent or given by or on behalf
of such Reselling Purchaser to such person at or prior to the written
confirmation of the sale of the New Debentures to such person and such statement
or omission is cured in the Prospectus.
<PAGE>
 
                                      -6-

          Each Reselling Purchaser agrees to indemnify and hold harmless the
Company, its directors, its officers who sign the Registration Statement and any
person controlling the Company to the same extent as the foregoing indemnity
from the Company to each Reselling Purchaser, but only with reference to
information relating to said Reselling Purchaser furnished to the Company in
writing by the Reselling Purchaser or the Representative by or on behalf of said
Reselling Purchaser expressly for use in the Registration Statement or the
Prospectus.

          In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either of the two preceding paragraphs, such person (the
"indemnified party") shall promptly notify the person or persons against whom
such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding
(provided, however, that if such indemnified party shall object to the selection
of counsel after having been advised by such counsel that there may be one or
more legal defenses available to the indemnified party which are different from
or additional to those available to the indemnifying party, the indemnifying
party shall designate other counsel reasonably satisfactory to the indemnified
party) and the indemnifying party shall pay the fees and disbursements of such
counsel related to such proceeding.  In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless the
indemnifying party and the indemnified party shall have mutually agreed to the
retention of such counsel.  The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent but if settled
with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment.

          If the indemnification provided for in this Article VIII is
unavailable to an indemnified party under the first or second paragraph hereof
or insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party, in lieu of indemnifying such
indemnified party shall severally contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Reselling Purchasers on
the other from the offering of the New Debentures or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and of the Reselling Purchasers on the other in connection with the
statement or omission that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations.  The
relative benefits received by the Company on the one hand and the Reselling
Purchasers on the other in connection with the offering of the New Debentures
<PAGE>
 
                                      -7-

shall be deemed to be in the same proportion as the total net proceeds from the
offering of the New Debentures received by the Company bear to the total
commissions, if any, received by all of the Reselling Purchasers in respect
thereof.  If there are no commissions allowed or paid by the Company to the
Reselling Purchasers in respect of the New Debentures, the relative benefits
received by the Reselling Purchasers in the preceding sentence shall be the
difference between the price received by such Reselling Purchasers upon resale
of the New Debentures and the price paid for the New Debentures pursuant to the
Purchase Agreement.  The relative fault of the Company on the one hand and of
the Reselling Purchasers on the other shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company or by the Reselling Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.

          The amount paid or payable by an indemnified party as a result of the
losses, claims, damages and liabilities referred to in this Article VIII shall
be deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim.  No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.

                                 IX.  SURVIVAL

          The indemnity and contribution agreements contained in Article VIII
and the representations and warranties of the Company contained in Article VII
of this Agreement shall remain operative and in full force and effect regardless
of (i) any termination of this Agreement, (ii) any investigation made by any
Reselling Purchaser or on behalf of any Reselling Purchaser or any persons
controlling any Reselling Purchaser and (iii) acceptance of and payment for any
of the New Debentures.


                    X.  TERMINATION BY RESELLING PURCHASERS

          At any time prior to the Closing Date this Agreement shall be subject
to termination in the absolute discretion of the Reselling Purchasers, by notice
given to the Company, if (i) trading in securities generally on the New York
Stock Exchange shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York shall have been declared
by either Federal or New York State authorities, (iii) minimum prices shall have
been established on the New York Stock Exchange by Federal or New York State
authorities or (iv) any outbreak or material escalation of hostilities involving
the United States or declaration by the United States of a national emergency or
war or other calamity or crisis shall have occurred, the effect of any of which
is such as to make it impracticable or inadvisable to proceed with the delivery
of the New Debentures on the terms and in the manner contemplated by the
Prospectus.
<PAGE>
 
                                      -8-

                         XI.  TERMINATION BY PURCHASERS

          If this Agreement shall be terminated by the Purchasers because of any
failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason (other
than those set forth in Article V) the Company shall be unable to perform its
obligations under this Agreement, the Company will reimburse the Purchasers for
all out-of-pocket expenses (including the fees and disbursements of counsel)
reasonably incurred by such Purchasers in connection with the New Debentures.
Except as provided herein, the Purchasers shall bear all of their expenses,
including the fees and disbursements of counsel.

                        XII.  SUBSTITUTION OF PURCHASERS

          If for any reason any Purchaser shall not purchase the New Debentures
it has agreed to purchase hereunder, the remaining Purchasers shall have the
right within 24 hours to make arrangements satisfactory to the Company for the
purchase of such New Debentures hereunder.  If they fail to do so, the amounts
of New Debentures that the remaining Purchasers are obligated, severally, to
purchase under this Agreement shall be increased in the proportions which the
total amount of New Debentures which they have respectively agreed to purchase
bears to the total amount of New Debentures which all non-defaulting Purchasers
have so agreed to purchase, or in such other proportions as the Purchasers may
specify to absorb such unpurchased New Debentures, provided that such aggregate
increases shall not exceed 10% of the total amount of the New Debentures set
forth in Schedule A to the Purchase Agreement.  If any unpurchased New
Debentures still remain, the Company shall have the right either to elect to
consummate the sale except as to any such unpurchased New Debentures so
remaining or, within the next succeeding 24 hours, to make arrangements
satisfactory to the remaining Purchasers for the purchase of such New
Debentures.  In any such cases, either the Purchasers or the Representative or
the Company shall have the right to postpone the Closing Date for not more than
seven business days to a mutually acceptable date. If the Company shall not
elect to so consummate the sale and any unpurchased New Debentures remain for
which no satisfactory substitute Purchaser is obtained in accordance with the
above provisions, then this Agreement shall terminate without liability on the
part of any non-defaulting Purchaser or the Company for the purchase or sale of
any New Debenture under this Agreement.  No provision in this paragraph shall
relieve any defaulting Purchaser of liability to the Company for damages
occasioned by such default.

                              XIII.  MISCELLANEOUS

          This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.

          This Agreement shall be governed by and construed in accordance with
the substantive laws of the State of New York.
<PAGE>
 
                                                                       Exhibit A



                                 LETTERHEAD OF
                                WILLIAM G. MUNDY
                         Vice President-General Counsel


_____________, 199___



and the other Purchasers named in
the Purchase Agreement dated ____________,
199____, between GTE California Incorporated
and such Purchasers

Re:  GTE California Incorporated
  ___% Debentures, Series __, Due ____


Dear Sirs:

      I have been requested by GTE California Incorporated, a California
corporation (the "Company"), as its Vice President-General Counsel to furnish
you with my opinion pursuant to a Purchase Agreement dated ______, 199____ (the
"Agreement") between you and the Company, relating to the purchase and sale of
$___,000,000 aggregate principal amount of its ___% Debentures, Series ____, Due
____ (the "New Debentures").

      In this connection I have examined among other things:

     (a) The Restated Certificate of Incorporation of the Company, as amended,
and the By-laws of the Company, each as presently in effect;

     (b) A copy of the Indenture dated as of December 1, 1993, as amended and
supplemented by the First Supplemental Indenture dated as of April 15, 1996 (as
amended and supplemented, the "Indenture"), between the Company and First Trust
of California, National Association, as successor trustee to Bank of America
National Trust and Savings Association (the "Trustee"), under which the New
Debentures are being issued;

     (c) [The Supplemental Indenture, dated as of ____, 199_ (the "Supplemental
Indenture") between the Company and the Trustee] [The resolutions of the Board
of Directors adopted _____, 199_ (the "Board Resolution")] [The certificate,
dated _____, 199_, of an authorized officer of the Company pursuant to
authorization from the Board of Directors of the Company (the "Officers'
Certificate")] specifically authorizing the New Debentures, including the
issuance and sale of the New Debentures;

     (d) The form of the New Debentures set forth in the [Supplemental
Indenture] [Board Resolution] [Officers' Certificate];

     (e) The records of the corporate proceedings of the Company relating to the
authorization, execution and delivery of the Indenture and the [Supplemental
Indenture] [Board Resolution] [Officers' Certificate];

     (f) The records of the corporate proceedings of the Company relating to the
authorization, execution and delivery of the Agreement;
<PAGE>
 
                                      -2-


     (g) The record of all proceedings taken by the Company relating to the
registration of the New Debentures under the Securities Act of 1933, as amended
(the "Act"), and qualification of the Indenture under the Trust Indenture Act of
1939, as amended (the "TIA"), particularly Registration Statement No. 333-01001
and Registration Statement No. 333-_____, including the form of prospectus
contained therein (unless the context shall otherwise require, the Registration
Statements as amended, are hereinafter called the "Registration Statement" and
the prospectus dated _________, together with the prospectus supplement dated
__________ relating to the New Debentures in the form filed under Rule 424(b) of
the Act, are hereinafter called the "Prospectus");

     (h) Statutes, permits and other documents relating to the Company's
franchises;

     (i) The records of proceedings and orders issued by the California Public
Utility Commission authorizing the issuance and sale of the New Debentures; and

     (j) The Registration Statement, the Prospectus and all documents filed by
the Company under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), which are incorporated by reference in the Prospectus (the "Incorporated
Documents").

     On the basis of my examination of the foregoing and of such other documents
and matters as I have deemed necessary as the basis for the opinions hereinafter
expressed, I am of the opinion that:

     1.  The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of California, and has adequate
corporate power to own and operate its properties and to carry on the business
in which it is now engaged.  There are no states or jurisdictions in which the
qualification or licensing of the Company as a foreign corporation is necessary
where the failure to be qualified or licensed would have a material adverse
effect on the Company.

     2.  All legal proceedings necessary to the authorization, issue and sale of
the New Debentures to you have been taken by the Company.

     3.  The Agreement has been duly and validly authorized, executed and
delivered by the Company.

     4.  The Indenture is in proper form, has been duly authorized by the
Company, has been duly executed by the Company and the Trustee and delivered by
the Company and constitutes a legal, valid and binding agreement of the Company
enforceable in accordance with its terms, except as limited by bankruptcy,
insolvency and other laws affecting the enforcement of creditors' rights and the
availability of equitable remedies.  The Indenture has been duly qualified under
the TIA.

     5.  The New Debentures conform as to legal matters with the statements
concerning them in the Registration Statement and Prospectus and have been duly
authorized and executed by the Company and (assuming due authentication and
delivery thereof by the Trustee) have been duly issued for value by the Company
and (subject to the qualifications set forth in paragraph 4 above) constitute
legal, valid and binding obligations of the Company enforceable in accordance
with their terms and are entitled to the benefits afforded by the Indenture.
<PAGE>
 
                                      -3-


     6.  The issuance and sale of the New Debentures, as contemplated by the
Agreement, have been duly authorized by the California Public Utility
Commission, and such authorization is in full force and effect and, except as
may be required by the securities or Blue Sky laws of certain jurisdictions, no
other authorization, approval or consent of any governmental regulatory
authority is required for the issuance and sale of the New Debentures.

     7.  The Company holds valid and subsisting franchises, licenses and permits
adequate for the conduct of its business in the territory served by it, except
for limited areas where the Company operates by sufferance, and none of the
franchises, licenses or permits of the Company contain any unduly burdensome
restrictions.

     8. Registration Statement No. 333-_____ became effective on _____, 1998 and
Registration Statement No. 333-01001 became effective on February 22, 1996,
respectively, and, to the best of my knowledge, no proceedings under Section 8
of the Act looking toward the possible issuance of a stop order with respect
thereto are pending or threatened and the Registration Statement remains in
effect on the date hereof. The Registration Statement and the Prospectus comply
as to form in all material respects with the relevant provisions of the Act and
of the Exchange Act as to the Incorporated Documents and the applicable rules
and regulations of the Securities and Exchange Commission thereunder, except
that I express no opinion as to the financial statements or other financial data
contained therein. The Prospectus is lawful for use for the purposes specified
in the Act in connection with the offer for sale and sale of the New Debentures
in the manner therein specified. I have no reason to believe that the
Registration Statement or the Incorporated Documents, considered as a whole on
the effective date of the Registration Statement, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading or
that the Prospectus and the Incorporated Documents, considered as a whole on the
date hereof, contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that in
each case I express no opinion as to the financial statements or other financial
data contained therein.

     Without my prior written consent, this opinion may not be relied upon by
any person or entity other than the addressee, quoted in whole or in part, or
otherwise referred to in any report or document, or furnished to any other
person or entity, except that Milbank, Tweed, Hadley & McCloy may rely upon this
opinion as if this opinion were separately addressed to them.

                              Very truly yours,



                              William G. Mundy
                              Vice President-General Counsel

c:  Milbank, Tweed, Hadley & McCloy
<PAGE>
 
                                                        Exhibit B

                        MILBANK, TWEED, HADLEY & McCLOY
                            1 Chase Manhattan Plaza
                            New York, New York 10005



__________, 199_

                          GTE CALIFORNIA INCORPORATED

                $___,000,000 __% Debentures, Series ____, Due ____



and the other several Purchasers
referred to in the Purchase Agreement
dated ___________________, among such
Purchasers and GTE California Incorporated

Dear Sirs:

          We have been designated by GTE California Incorporated (the "Company")
as counsel for the purchasers of $___,000,000 aggregate principal amount of its
___% Debentures, Series ____, Due ____ (the "New Debentures").  Pursuant to such
designation and the terms of a Purchase Agreement dated ________, relating to
the New Debentures (the "Purchase Agreement"), entered into by you with the
Company,  we have acted as your counsel in connection with your several
purchases this day from the Company of the New Debentures, which are issued
under an Indenture dated as of December 1, 1993, as amended and supplemented by
the First Supplemental Indenture dated as of April 15, 1996 (as amended and
supplemented, the "Indenture"), between the Company and First Trust of
California, National Association, as successor trustee to Bank of America
National Trust and Savings Association (the "Trustee").

          We have reviewed originals, or copies certified to our satisfaction,
of such corporate records of the Company, indentures, agreements and other
instruments, certificates of public officials and of officers and
representatives of the Company, and other documents, as we have deemed necessary
as a basis for the opinions hereinafter expressed.  In such examination we have
assumed the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity with the original documents of all
documents submitted to us as copies, and the authenticity of the originals of
such latter documents.  As to various questions of fact material to such
opinions, we have, when relevant facts were not independently established,
relied upon certifications by officers of the Company and statements contained
in the Registration Statement hereinafter mentioned.

          In addition, we attended the closing held today at the offices of GTE
Service Corporation, One Stamford Forum, Stamford, Connecticut, at which the
Company caused the New Debentures to be delivered to your representatives at the
Depository Trust Company, 55 Water Street, New York, New York, for your several
accounts, against payment therefor.

          On the basis of the foregoing and having regard to legal
considerations which we deem relevant, we are of the opinion that:
<PAGE>
 
                                      -2-


     1.  The Company is a validly existing corporation, in good standing, under
the laws of the State of California.

     2.  The Purchase Agreement has been duly authorized, executed and delivered
by and on behalf of the Company.

     3.  The Indenture has been duly authorized, executed and delivered by the
Company and constitutes a legal, valid and binding agreement of the Company
enforceable in accordance with its terms, except as limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws of general applicability
affecting the enforceability of creditors' rights.  The enforceability of the
Indenture is subject to the effect of general principles of equity (regardless
of whether considered in a proceeding in equity or at law), including without
limitation (i) the possible unavailability of specific performance, injunctive
relief or any other equitable remedy and (ii) concepts of materiality,
reasonableness, good faith and fair dealing.  The Indenture has been duly
qualified under the Trust Indenture Act of 1939, as amended.

     4.  The New Debentures have been duly authorized and conform as to legal
matters in all substantial respects to the description thereof contained in the
Registration Statement and Prospectus hereinafter mentioned.  The New Debentures
(assuming due execution thereof by the Company and due authentication and
delivery by the Trustee) have been duly issued for value by the Company and
(subject to the qualifications stated in paragraph 3 above) constitute legal,
valid and binding obligations of the Company, and are entitled to the benefits
afforded by the Indenture in accordance with the terms of the Indenture and of
the New Debentures.

     5.  On the basis of information received by the Company from the Securities
and Exchange Commission (the "Commission") Registration Statements No. 333-_____
and No. 333-01001 with respect to the New Debentures (collectively, the
"Registration Statement"), filed with the Commission pursuant to the Securities
Act of 1933, as amended (the "Act"), became effective under the Act on ________,
1998 and February 22, 1996, respectively, and thereupon the Prospectus dated
______________ as supplemented by the Prospectus Supplement dated ____________
(collectively, the "Prospectus") became lawful for use for the purposes
specified in the Act, in connection with the offer for sale and sale of the New
Debentures in the manner therein specified, subject to compliance with the
provisions of securities or Blue Sky laws of certain States in connection with
the offer for sale or sale of the New Debentures in such States.  To the best of
our knowledge, the Registration Statement remains in effect at this date.

     6.  The Registration Statement, as of its effective date, and the
Prospectus, as of the date hereof, together with the documents incorporated by
reference therein (the "Incorporated Documents") (except any financial
statements or other financial data contained or incorporated by reference in the
Registration Statement, the Prospectus or such Incorporated Documents, as to
which no opinion is expressed) appear on their face to be appropriately
responsive, in all material respects relevant to the offering of the New
Debentures, to the requirements of the Act and the Securities Exchange Act of
1934, as amended (the "Exchange Act"), as applicable, and the applicable rules
and regulations of the Commission thereunder.
<PAGE>
 
                                      -3-


     The Registration Statement was filed on Form S-3 under the Act and,
accordingly, the Prospectus does not necessarily contain a current description
of the Company's business and affairs, since Form S-3 provides for the
incorporation by reference of certain documents filed with the Commission which
contain descriptions as of various dates.  We participated in conferences with
counsel for, and representatives of, the Company in connection with the
preparation of the Registration Statement and Prospectus and we have reviewed
the Incorporated Documents.  In connection with our participation in the
preparation of the Registration Statement and the Prospectus, we have not
independently verified the accuracy, completeness or fairness of the statements
contained therein or in the Incorporated Documents, and the limitations inherent
in the review made by us and the knowledge available to us are such that we are
unable to assume, and we do not assume, any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Prospectus or the Incorporated Documents, except as otherwise
specifically stated herein.  None of the foregoing disclosed to us any
information which gave us reason to believe that the Registration Statement or
the Incorporated Documents, considered as a whole on the effective date of the
Registration Statement, contained or contain any untrue statement of a material
fact or omitted or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein not misleading or that the
Prospectus and the Incorporated Documents, considered as a whole on the date
hereof, contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.  We express no opinion
as to any document filed by the Company under the Exchange Act, whether prior or
subsequent to such effective date, except to the extent that such documents are
Incorporated Documents read together with the Registration Statement or the
Prospectus and considered as a whole, nor do we express any opinion as to the
financial statements or other financial data included in or omitted from, or
incorporated by reference in the Registration Statement, the Prospectus or the
Incorporated Documents.

     We express no opinion as to matters governed by any laws other than the
laws of the State of New York, the Federal laws of the United States of America
and, to the extent the foregoing opinions involve the laws of the States of
Arizona, California and Nevada, in reliance upon the opinion of even date
herewith of William G. Mundy, Esq., Vice President-General Counsel of the
Company, the laws of the States of Arizona, California and Nevada.

     The opinions contained herein are rendered to you and are solely for your
benefit and the benefit of the Purchasers represented by you in connection with
the transaction contemplated by the Purchase Agreement.  These opinions may not
be relied upon by you for any other purpose, or furnished to, quoted or relied
upon by any other person, firm or corporation for any purpose, without our prior
written consent.

                                    Very truly yours,



                                    MILBANK, TWEED, HADLEY & McCLOY
<PAGE>
 
                                                        Exhibit C


                    LETTER OF INDEPENDENT PUBLIC ACCOUNTANTS


          The letter of independent public accountants for the Company to be
delivered pursuant to Article IV, paragraph (E) of the document entitled
Standard Purchase Agreement Provisions, February 1998 Edition, shall be to the
effect that:

          At the closing, the Purchasers shall have received such number of
copies as are necessary to provide one for each Purchaser of a letter addressed
to the Company and satisfactory to the Purchasers or the Representative and
counsel to the Purchasers, dated as of the Closing Date and encompassing the
performance of certain procedures described in the letter as of a date not more
than five business days prior to the Closing Date (the "Cutoff Date"), from
Arthur Andersen LLP, confirming that they are independent public accountants
with respect to the Company within the meaning of the Securities Act of 1933, as
amended (the "Act") and the applicable published rules and regulations of the
Commission thereunder, specifically Rule 2-01 of Regulation S-X, and stating in
effect (1) that in their opinion, the financial statements and schedules audited
by them and incorporated by reference in the Prospectus comply as to form in all
material respects with the applicable accounting requirements of the Act, and
the Securities Exchange Act of 1934, as amended the ("Exchange Act") and the
published rules and regulations thereunder, (2) that although they have not
audited any financial statements of the Company as of any date or for any period
subsequent to the prior-year audit, and although they have conducted an audit
for that period, the purpose (and therefore the scope) of the audit was to
enable them to express their opinion on the financial statements as of that date
and for the year then ended, but not on the financial statements for any interim
period within that year; therefore, they are unable to and do not express any
opinion on the unaudited condensed consolidated balance sheet as of the latest
available interim date, and the unaudited condensed consolidated  statements of
income, reinvested earnings, and cash flows for the latest available interim
period subsequent to that prior-year audit which are included in the Prospectus
and for the comparable period of the preceding year; they have performed the
procedures specified by the American Institute of Certified Public Accountants
for a review of interim financial information as described in SAS No. 71,
Interim Financial Information, on the latest available unaudited interim
condensed consolidated financial statements prepared by the Company, inquired of
certain officials of the Company responsible for financial and accounting
matters, and read the minutes of the Board of Directors and shareholders of the
Company, all of which procedures have been agreed to by the Purchasers, nothing
has come to their attention which caused them to believe that: (a) any unaudited
interim condensed consolidated financial statements incorporated by reference in
the Prospectus (i) do not comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act as it applies to Form 10-
Q and the related published rules and regulations thereunder or (ii) have not
been presented in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited financial
statements incorporated by reference in the Prospectus; or (b) (i) as of the
date of the latest available unaudited condensed consolidated interim financial
statements prepared by the Company, there have been any changes in the capital
stock or any increase in the short-term indebtedness or long-term debt of the
Company or any decrease in net assets, in each case as compared with the amounts
shown on the latest balance sheet incorporated by reference in the Prospectus,
(ii) for the period from the date of the latest financial statements included or
incorporated by reference in the Prospectus to the specified date referred to in
the preceding clause (i), there were any decreases in operating revenues, net
operating income, net income or the Company's ratio to earnings to fixed

<PAGE>
 
                                      -2-

charges, in each case as compared with the comparable period of the preceding
year, or (iii) as of the Cutoff Date there have been any material changes in the
capital stock or any material increase in the debt of the Company, or any
material decreases in net assets, in each case as compared with amounts shown in
the latest balance sheet included or incorporated by reference in the
Prospectus, and (iv) for the period from the date of the latest available
interim financial statements referred to in clause (b)(i) above to the Cutoff
Date, there were any material decreases in operating revenues, net operating
income or net income, in each case as compared with the comparable period of the
preceding year, except in all instances for changes or decreases which the
Prospectus discloses have occurred or may occur or as disclosed in such letter
and except for changes occasioned by the declaration and payment of dividends on
the stock of the Company or occasioned by sinking fund payments made on the debt
securities of the Company, and (3) that they have performed the following
additional procedures with respect to the ratios of earnings to fixed charges
included or incorporated by reference in the Prospectus: (i) compared the
amounts used in the computation of such ratios with the amounts included in the
financial statements incorporated by reference in the Prospectus and noted
agreement in all material respects, and (ii) recomputed the ratios and noted
agreement in all material respects.

<PAGE>
 
                                                       Exhibit 4.2

                             FORM OF NEW DEBENTURE

                          (FORM OF FACE OF DEBENTURE)

[If Debenture is a Global Debenture, insert the following:

EXCEPT AS OTHERWISE PROVIDED IN SECTION 2.11 OF THE INDENTURE, THIS GLOBAL
DEBENTURE MAY BE TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE
OF THE DEPOSITORY OR TO A SUCCESSOR DEPOSITORY OR TO A NOMINEE OF SUCH SUCCESSOR
DEPOSITORY.]

[If The Depository Trust Company is the Depository, insert the following:

Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Company or its
agent for registration of transfer, exchange, or payment, and any certificate
issued is registered in the name of DTC (and any payment is made to Cede & Co.
or to such other entity as is requested by an authorized representative of DTC),
ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.]


No. _____________                                               $ _____________

                          GTE California Incorporated
                      ____% Debentures, Series ____, Due ____

GTE California Incorporated, a corporation duly organized and existing under the
laws of the State of California (herein referred to as the "Company"), for value
received, hereby promises to pay to _______________ or registered assigns, the
principal sum of __________________ Dollars on __________________ and to pay
interest on said principal sum from __________________, or from the most recent
interest payment date to which interest has been paid or duly provided for,
semi-annually on _________ and ____________ in each year, commencing
____________, at the rate of _____% per annum until the principal hereof shall
have become due and payable, and on any overdue principal and (to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum. The interest
installment so payable, and punctually paid or duly provided for, on any
interest payment date will, as provided in the Indenture hereinafter referred
to, be paid to the person in whose name this Debenture (or one or more
Predecessor Securities, as defined in said Indenture) is registered at the close
of business on the regular record date for such interest installment, which
shall be the __________ or __________, as the case may be (whether or not a
business day), next preceding such interest payment date. Any such interest
installment not so punctually paid or duly provided for shall forthwith cease to
be payable to the registered holder on such regular record date, and may be paid
to the person in whose name this Debenture (or one or more Predecessor
Securities) is registered at the close of business on a special record date to
be fixed by the Trustee for the payment of such defaulted interest, notice

<PAGE>
 
                                      -2-

whereof shall be given to the registered holders of this series of Debentures
not less than 10 days prior to such special record date, or may be paid at any
time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Debentures may be listed, and upon such notice
as may be required by such exchange, all as more fully provided in the Indenture
hereinafter referred to. The principal of and the interest on this Debenture
shall be payable at the office or agency of the Company maintained for that
purpose in the City of Los Angeles, State of California in any coin or currency
of the United States of America which at the time of payment is legal tender for
payment of public and private debts; provided, however, that payment of interest
may be made at the option of the Company by check mailed to the registered
holder at such address as shall appear in the Security Register.

This Debenture shall not be entitled to any benefit under the Indenture
hereinafter referred to, or be valid or become obligatory for any purpose, until
the Certificate of Authentication hereon shall have been signed by or on behalf
of the Trustee.

The provisions of this Debenture are continued on the reverse side hereof and
such continued provisions shall for all purposes have the same effect as though
fully set forth at this place.

      IN WITNESS WHEREOF, the Company has caused this instrument to be executed.

Dated: _________                GTE CALIFORNIA INCORPORATED

                                By __________________________
                                          President


Attest:

By __________________________
     Secretary

                    (FORM OF CERTIFICATE OF AUTHENTICATION)

                         CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the series designated herein referred to in the
within-mentioned Indenture.

                First Trust of California, National Association
                      as Trustee, Authenticating Agent and
                               Security Registrar

                         By __________________________
                              Authorized Signatory
<PAGE>
 
                                      -3-

                         (FORM OF REVERSE OF DEBENTURE)

This Debenture is one of a duly authorized series of Securities of the Company
(herein sometimes referred to as the "Securities"), all issued or to be issued
in one or more series under and pursuant to an Indenture dated as of December 1,
1993, duly executed and delivered between the Company and Bank of America
National Trust and Savings Association, a national banking organization
organized and existing under the laws of the United States of America and a
First Supplemental Indenture dated as of April 15, 1996 duly executed and
delivered between the Company and First Trust of California, National
Association, a national banking association organized and existing under the
laws of the United States of America, as successor trustee to Bank of America
National Trust and Savings Association (hereinafter referred to as the
"Trustee") (said Indenture, as amended and supplemented by the First
Supplemental Indenture dated as of April 15,  1996, is hereinafter referred to
as the "Indenture"), to which Indenture reference is hereby made for a
description of the rights, limitation of rights, obligations, duties and
immunities thereunder of the Trustee, the Company and the holders of the
Securities. By the terms of the Indenture, the Securities are issuable in series
which may vary as to amount, date of maturity, rate of interest and in other
respects as in the Indenture provided. This Debenture is one of the series
designated on the face hereof (herein called the "Debentures") limited in
aggregate principal amount to $___,000,000.

[INSERT IF GLOBAL DEBENTURE - This Global Debenture shall be exchangeable for
Debentures in definitive form registered in the names of persons other than the
Depository or its nominee only if (i) the Depository notifies the Company that
it is unwilling or unable to continue as the Depository or if at any time such
Depository is no longer registered or in good standing under the Securities
Exchange Act of 1934 or other applicable statute and a successor depository is
not appointed by the Company within 90 days or (ii) the Company executes and
delivers to the Trustee an Officer's Certificate that the Global Debenture shall
be so exchangeable.  To the extent that the Global Debenture is exchangeable
pursuant to the preceding sentence, it shall be exchangeable for Debentures
registered in such names as the Depository shall direct.

Notwithstanding any other provision herein, this Global Debenture may not be
transferred except as a whole by the Depository to a nominee of such Depository
or by a nominee of such Depository to such Depository or another nominee of such
Depository.]

In case an Event of Default, as defined in the Indenture, with respect to the
Debentures shall have occurred and be continuing, the principal of all of the
Debentures may be declared, and upon such declaration shall become, due and
payable, in the manner, with the effect and subject to the conditions provided
in the Indenture.

The Indenture contains provisions permitting the Company and the Trustee, with
the consent of the holders of not less than a majority in aggregate principal
amount of the Securities of each series affected at the time outstanding, as
defined in the Indenture, to execute supplemental indentures for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or of modifying in

<PAGE>
 
                                      -4-

any manner the rights of the holders of the Securities; provided, however, that
no such supplemental indenture shall (i) extend the fixed maturity of any
Securities of any series, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon, or reduce any premium
payable upon the redemption thereof, without the consent of the holder of each
Security so affected or (ii) reduce the aforesaid percentage of Securities, the
holders of which are required to consent to any such supplemental indenture,
without the consent of the holders of each Security then outstanding and
affected thereby. The Indenture also contains provisions permitting the holders
of a majority in aggregate principal amount of the Securities of any series at
the time outstanding, on behalf of the holders of Securities of such series, to
waive any past default in the performance of any of the covenants contained in
the Indenture, or established pursuant to the Indenture with respect to such
series, and its consequences, except a default in the payment of the principal
of, or premium, if any, or interest on any of the Securities of such series. Any
such consent or waiver by the registered holder of this Debenture (unless
revoked as provided in the Indenture) shall be conclusive and binding upon such
holder and upon all future holders and owners of this Debenture and of any
Debenture issued in exchange herefor or in place hereof (whether by registration
of transfer or otherwise), irrespective of whether or not any notation of such
consent or waiver is made upon this Debenture.

No reference herein to the Indenture and no provision of this Debenture or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this
Debenture at the times and place and at the rate and in the money herein
prescribed.

The Debentures are issuable as registered Debentures without coupons in
denominations of $1,000 or any integral multiple thereof.  Debentures may be
exchanged, upon presentation thereof for that purpose, at the office or agency
of the Company in the City of Los Angeles, State of California, for other
Debentures of authorized denominations, and for a like aggregate principal
amount and series, and upon payment of a sum sufficient to cover any tax or
other governmental charge in relation thereto.

[The Debentures will not be redeemable prior to maturity.]

                                       OR

[The Debentures may not be redeemed prior to ________________.  The Debentures
may be redeemed on not less than 30 nor more than 60 days prior notice given as
provided in the Indenture, as a whole or from time to time in part, at the
option of the Company, on any date or dates on or after ______________, and
prior to maturity, at the applicable percentage of the principal amount thereof
to be redeemed as set forth below under the heading "Redemption Price" during
the respective twelve month periods beginning ____ of the years shown below:

               Year      Redemption Price
               ____      ________________
                                      %
<PAGE>
 
                                      -5-

together, in each case, with accrued interest to the date fixed for redemption
(but if the date fixed for redemption is an interest payment date, the interest
installment payable on such date shall be payable to the registered holder at
the close of business on the applicable record date).]

As provided in the Indenture and subject to certain limitations therein set
forth, this Debenture is transferable by the registered holder hereof on the
Security Register of the Company, upon surrender of this Debenture for
registration of transfer at the office or agency of the Company in the City of
Los Angeles, State of California accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company or the Security
Registrar duly executed by the registered holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Debentures of authorized
denominations and for the same aggregate principal amount and series will be
issued to the designated transferee or transferees.  No service charge will be
made for any such transfer, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in relation
thereto.

Prior to due presentment for registration of transfer of this Debenture the
Company, the Trustee, any paying agent and any Security Registrar may deem and
treat the registered holder hereof as the absolute owner hereof (whether or not
this Debenture shall be overdue and notwithstanding any notice of ownership or
writing hereon made by anyone other than the Security Registrar) for the purpose
of receiving payment of or on account of the principal hereof and (subject to
Section 2.03 of the Indenture) interest due hereon and for all other purposes,
and neither the Company nor the Trustee nor any paying agent nor any Security
Registrar shall be affected by any notice to the contrary.

No recourse shall be had for the payment of the principal of or the interest on
this Debenture, or for any claim based hereon, or otherwise in respect hereof,
or based on or in respect of the Indenture, against any incorporator,
stockholder, officer or director, past, present or future, as such, of the
Company or of any predecessor or successor corporation, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issuance hereof, expressly waived and
released.

[INSERT IF GLOBAL DEBENTURE - The Depository by acceptance of this Global
Debenture agrees that it will not sell, assign, transfer or otherwise convey any
beneficial interest in this Global Debenture unless such beneficial interest is
in an amount equal to an authorized denomination for Debentures of this series.]

Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings set forth in the Indenture.

<PAGE>
 
                                                        Exhibit 5


                                WILLIAM G. MUNDY
                         Vice President-General Counsel
                          GTE California Incorporated
                                600 Hidden Ridge
                              Irving, Texas 75038

                                 (972) 718-6304



February 20, 1998


GTE California Incorporated
600 Hidden Ridge
Irving, Texas 75038

Gentlemen:

I have examined a copy of the Registration Statement of GTE California
Incorporated (the "Company") on Form S-3 under the Securities Act of 1933, as
amended, and accompanying Prospectus pertaining to the issuance and sale of
$400,000,000 aggregate principal amount of debentures (the "Debentures").  I
have also examined a copy of the Company's Restated Certificate of
Incorporation, as amended, and such corporate records and other documents as I
have deemed to be requisite in the premises.  I am familiar with the proceedings
taken and proposed to be taken by you under my supervision as your counsel in
connection with the proposed authorization, issuance, and sale of the
Debentures.

It is my opinion that, subject to any applicable regulatory approvals, the
Debentures, upon the issuance and sale thereof in the manner contemplated in
said Registration Statement, will be legally and validly issued and will be
binding obligations of the Company.

I hereby consent to the reference to me under the caption "Certain Legal
Matters" in the Prospectus forming a part of the Registration Statement and to
the filing of this opinion as an exhibit to the Registration Statement.

Yours truly,


WILLIAM G. MUNDY
- ----------------
William G. Mundy
Vice President-General Counsel
GTE California Incorporated

<PAGE>
 
                                                       Exhibit 25


                       SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C.  20549
                                _______________


                                    FORM T-1
              Statement of Eligibility and Qualification under the
                  Trust Indenture Act Of 1939 of a Corporation
                          Designated to Act as Trustee

                                _______________


                FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION

              (Exact name of trustee as specified in its charter)


  United States                                    94-3160100
(State of Incorporation)                  (I.R.S. Employer Identification No.)


                        550 South Hope Street, Suite 500
                         Los Angeles, California 90071

             (Address of principal executive offices and zip code)

                         _____________________________


                          GTE CALIFORNIA INCORPORATED
                                        
              (Exact name of obligor as specified in its charter)

                                   CALIFORNIA

         (State or other jurisdiction of incorporation or organization)

                                   95-0510200

                      (I.R.S. Employer Identification No.)


                     600 Hidden Ridge, Irving, Texas 75038
                                 (972) 718-5600

   (Address and telephone number of principal executive offices and zip code)


DAVID S. KAUFFMAN, ESQ.                          CHARLES J. SOMES, ESQ.
GTE Service Corporation                       GTE California Incorporated
  One Stamford Forum                               600 Hidden Ridge
Stamford, Connecticut 06904                       Irving, Texas 75038
      (203) 965-2986                                 (214) 718-5600

         (Names, addresses and telephone numbers of agents for service)


                                Debt Securities

                      (Title of the indenture securities)
<PAGE>
 
                                      -2-


1.  GENERAL INFORMATION  Furnish the following information as to the trustee.

   (a) Name and address of each examining or supervising authority to which it
       is subject.

       Comptroller of the Currency
       Washington, D.C.

   (b) Whether it is authorized to exercise corporate trust powers.

       Yes.

2.  AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS If the obligor or any underwriter
    for the obligor is an affiliate of the trustee, describe each such
    affiliation.

    None.

    See Note following Item 16.

    Items 3-15 are not applicable because to the best of the Trustee's knowledge
    the obligor is not in default under any Indenture for which the Trustee acts
    as Trustee.

16. LIST OF EXHIBITS  List below all exhibits filed as a part of this statement
    of eligibility and qualification.

Exhibit 1 -  Articles of Association of First Trust of California, National
             Association, dated June 5, 1992. Incorporated herein by reference
             to Exhibit 1 filed with Form T-1 Statement, Registration No. 33-
             50826.

Exhibit 2 -  Certificate of the Comptroller of Currency as to authority of First
             Trust of California, National Association, to commence the business
             of banking. Incorporated herein by reference to Exhibit 2 filed
             with Form T-1 Statement, Registration No. 33-50826.

Exhibit 3 -  Authorization of the Comptroller of Currency granting First Trust
             of California, National Association, the right to exercise
             corporate trust powers. Incorporated herein by reference to Exhibit
             3 filed with Form T-1 Statement, Registration No. 33-50826.

Exhibit 4 -  By-laws of First Trust of California, National Association, dated
             June 15, 1992.  Incorporated herein by reference to Exhibit 4 filed
             with Form T-1 Statement, Registration No. 33-50826.

Exhibit 5 -  Not applicable

Exhibit 6 -  Consent of First Trust of California, National Association,
             required by Section 321(b) of the Act. Incorporated herein by
             reference to Exhibit 6 filed with Form T-1 Statement, Registration
             No. 33-50826.

Exhibit 7 -  Report of Condition of First Trust of California, National
             Association, as of the close of business on September 30, 1997
             published pursuant to law or the requirements of its supervising or
             examining authority.
<PAGE>
 
                                      -3-



                                      NOTE

   The answers to this statement insofar as such answers relate to what persons
have been underwriters for any securities of the obligor within three years
prior to the date of filing this statement, or what persons are owners of 10% or
more of the voting securities of the obligor, or affiliates, are based upon
information furnished to the trustee by the obligor.  While the trustee has no
reason to doubt the accuracy of any such information, it cannot accept any
responsibility therefor.


                                   SIGNATURE


   Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
First Trust of California, National Association, an association organized and
existing under the laws of the United States, has duly caused this statement of
eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, and its seal to be hereunto affixed and attested, all
in the City of Los Angeles and State of California on the 3rd day of February
1998.


                              FIRST TRUST OF CALIFORNIA,
                              NATIONAL ASSOCIATION



                              By:   FONDA J. HALL
                                 -------------------
                                    Fonda J. Hall
                                    Assistant Vice President
 

Attest:   SHERI B. BALL
       -------------------
          Sheri B. Ball
          Vice President
<PAGE>
 
                                      -4-



                                   EXHIBIT 6

                                    CONSENT

In accordance with Section 321(b) of the Trust Indenture Act of 1939, the
undersigned, FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION, hereby consents
that reports of examination of the undersigned by Federal, State, Territorial or
District authorities may be furnished by such authorities to the Securities and
Exchange Commission upon its request therefor.


Dated:  February 3, 1998


                              FIRST TRUST OF CALIFORNIA,
                              NATIONAL ASSOCIATION

                              By  FONDA J. HALL
                                  _________________
                                  Fonda J. Hall
                                  Assistant Vice President
<PAGE>
 
                                      -5-


                             EXHIBIT 7 TO FORM T-1


                FIRST TRUST OF CALIFORNIA, NATIONAL ASSOCIATION
                        Statement of Financial Condition
                                 As of 9/30/97

                                    ($000's)
<TABLE>
<CAPTION>


Assets:

<S>                                                                               <C>
       Cash and Balances Due From Depository Institutions:                        $ 47,286
       Federal Reserve Stock:                                                        5,071
       Fixed Assets:                                                                   725
       Intangible Assets:                                                           76,018
       Other Assets:                                                                 7,991
                                                                                  --------
                                   Total Assets:                                  $137,091
                                                                                  ========

Liabilities:
       Other Liabilities:                                                            8,860
                                                                                  --------
                             Total Liabilities:                                   $  8,860
                                                                                  ========

Equity::
<S>                                                                               <C>
       Common and Preferred Stock:                                                   1,000
       Surplus:                                                                    126,260
       Undivided Profits and Capital Reserve:                                          968
       Net unrealized holding gains(losses) on available-
            for-sale securities:                                                         3
                                                                                  --------
                   Total Equity Capital:                                          $128,231
                                                                                  ========
       Total Liabilities and Equity Capital:                                      $137,091
                                                                                  ========

</TABLE>
- --------------------------------------------------------------------------------


To the best of the undersigned's determination, as of this date the above
financial information is true and correct.

First Trust of California, National Association



By  FONDA J. HALL
    _________________
    Fonda J. Hall
    Assistant Vice President

<PAGE>
 
                                                        Exhibit 26.1
                          GTE CALIFORNIA INCORPORATED

                    Invitation For Bids For the Purchase of
               $____,000,000 ____% Debentures, Series ____, Due____


          GTE CALIFORNIA INCORPORATED (the "Company") is inviting bids from
certain investment banks ("Invited Bidders"), each of whom may bid either
individually (a "Sole Bidder") or as part of a group of bidders for which the
Invited Bidder serves as the representative of such group (the
"Representative"), subject to the terms and conditions stated herein, for the
purchase from it of $____,000,000 aggregate principal amount of its ____%
Debentures, Series ____, Due ____ (the "Debentures").

1.  Information Respecting the Company and the Debentures.

          Invited Bidders may examine, at the office of the Secretary of the
Company, 600 Hidden Ridge, Irving, Texas 75038, or at the office of GTE Service
Corporation, 10th Floor, One Stamford Forum, Stamford, Connecticut 06904
(Telephone (203) 965-2986), on any business day between 10:00 A.M. and 4:00
P.M., the following:

               (a)  the Registration Statement on Form S-3 (including the
     Prospectus, documents incorporated by reference and exhibits), with respect
     to the Debentures;

               (b)  the Restated Articles of Incorporation of the Company, as
     amended;

               (c)  a copy of the Indenture dated as of December 1, 1993 and the
     First Supplemental Indenture dated as of April 15, 1996 (the Indenture as
     so supplemented is herein called the "Indenture") under which the
     Debentures are to be issued, together with the Form of New Debenture;

               (d)  the form of Purchase Agreement (including the Standard
     Purchase Agreement Provisions (February 1998 Edition)) to be used in
     submitting bids for the purchase of the Debentures;

               (e)  the form of questionnaire to be provided by each of the
     bidders; and

               (f)  memoranda prepared by counsel to the Company with respect to
     the status of the Debentures under securities or blue sky laws of certain
     jurisdictions.

          Copies of said documents in reasonable quantities (except the Restated
Articles of Incorporation of the Company, the Indenture, and other exhibits to
the Registration Statement) will be supplied upon request, so long as available,
to Invited Bidders.

          The Company reserves the right to amend the Registration Statement
(including exhibits thereto) and Prospectus and to supplement the Prospectus in
such manner as shall not be unsatisfactory to Messrs. Milbank, Tweed, Hadley &
McCloy.  The Company will make copies of any such amendments or supplements
available for examination at the above offices in Irving and Stamford.
<PAGE>
 
                                      -2-


2.  Information Regarding the Bidders to be Furnished to the Company.

          In the case of a bid by a group of bidders, the Representative shall
be designated and authorized as the representative of the several bidders in
such group in the questionnaires filed by the members of the group.

          In the case of a bid by a group of bidders, the Representative shall
provide to the Company in writing a list of the names of any potential bidder in
its group no later than 10:00 A.M. on the business day immediately preceding the
date scheduled for the submission of bids.  No bid by a group of bidders will be
accepted by the Company if such group contains a member to which the Company has
objected prior to 5:00 P.M. on the business day immediately preceding the date
scheduled for the submission of bids. Additional members may be added to a group
of bidders after 10:00 A.M. on the business day immediately preceding the date
scheduled for the submission of bids only with the consent of the Company.

          No bid will be considered unless the Sole Bidder, or in the case of a
group of bidders, each member of the group through the Representative, shall
have furnished to the Company, and the Company shall have received, two signed
copies of the form of questionnaire referred to above, properly filled out by
the Sole Bidder or by each member of the group of bidders (the Company
reserving, however, the right to waive the form of the questionnaire or any
irregularity which it deems to be immaterial in any such questionnaire and to
extend either generally or in specific instances the time for furnishing
questionnaires, and specifically reserving the right to obtain all required
bidder information by telegraph or other means of communication).  Such copies
shall be furnished to the Company at the office of GTE Service Corporation, 10th
Floor, One Stamford Forum, Stamford, CT 06904, Attention: David S. Kauffman,
Esq., before 5:00 P.M., New York City time on the business day immediately
preceding the date scheduled for the submission of bids (or on such later date
as may be determined pursuant to Section 5 hereof).  Notwithstanding the
furnishing of such questionnaires to the Company, any Sole Bidder, or the
Representative on behalf of a group of bidders, thereafter may determine,
without liability to the Company, not to bid, or any of the several members of a
group (other than the Representative) may withdraw therefrom at or before the
time of submission of the bid of such group.

3.  Obligations of a Representative to a Group of Bidders

          In the case of a group of bidders, the Representative shall (i) make
available to the members of the group any due diligence materials received by it
from the Company and (ii) upon the request of any member of such group, request
from the Company and deliver to such member of the group copies of the documents
listed in Section 1 hereof.

4.  Form and Contents of Bids.

          Each bid shall be for the purchase of all of the Debentures.

          In case the bid of a group of bidders is accepted, the obligations of
the members of the group to purchase the respective principal amounts of
Debentures indicated in the bid shall be several and not joint.  Such bidders
shall act through the Representative, who shall be empowered to bind the bidders
in the group.  No bidder may submit or participate in more than one bid.
<PAGE>
 
                                      -3-


5.  Submission of Bids and Delivery of Confirmation of Bids.

          All bids must be submitted by telephone and confirmed in writing in
the manner set forth in Exhibit A, Confirmation of Bid, attached, signed by the
Sole Bidder or the Representative on behalf of the members of a group of
bidders.  Each bid must specify: (a) the interest rate, which shall be a
multiple of 1/8 of 1% or 1/100 of 1%; and (b) the price to be paid to the
Company for the Debentures, which shall be expressed as a percentage of the
principal amount of the Debentures and shall not be less than 98% thereof nor
more than 100% thereof.  The Confirmation of Bid shall specify the same interest
rate and price specified in the telephonic bid.

          The Company reserves the right in its discretion from time to time to
postpone the time and the date for submission of bids for an aggregate period of
not exceeding thirty days, and will give notice of any such postponement to each
Invited Bidder, specifying in such notice the changes in the times and dates set
forth in the Purchase Agreement occasioned by such postponement.  In the event
that any such postponement should be for a period of more than three full
business days after the date of sending or delivering such notice, the time for
filing of questionnaires by prospective bidders under Section 2 hereof shall by
such notice be postponed to 5:00 P.M., New York City time, at the place of
delivery specified in Section 2 hereof, on the business day immediately
preceding the newly scheduled date for the submission of bids.

6.  Acceptance or Rejection of Bids.

          The Company may reject all bids, but if any bid for the Debentures is
accepted the Company will accept that bid which shall result in the lowest
"annual cost of money" to the Company for the Debentures, and any bid not so
accepted by the Company shall, unless such bid shall be involved in rebidding as
hereinafter provided, be deemed to have been rejected.  The lowest annual cost
of money to the Company for the Debentures shall be determined by the Company
and such determination shall be final.  In case the lowest annual cost of money
to the Company is provided by two or more such bids, the Company (unless it
shall reject all bids) will give the makers of such identical bids an
opportunity (the duration of which the Company may in its sole discretion
determine) to improve their bids.  The Company will accept, unless it shall
reject all bids, the improved bid providing the Company with the lowest annual
cost of money for the Debentures.  If upon such rebidding the lowest annual cost
of money to the Company is again provided by two or more improved bids, the
Company may without liability to the maker of any other bid accept any one of
such improved bids in its sole discretion, or may reject all bids. If no
improved bid is made within the time fixed by the Company, the Company may
without liability to the maker of any other bid accept any one of the initially
submitted bids providing the lowest annual cost of money to the Company, or may
reject all bids.

          The Company further reserves the right to reject the bid of any Sole
Bidder or group of bidders if the Company, in the opinion of its counsel, may
not lawfully sell the Debentures to such bidder or to any member of such group,
unless, in the case of a group of bidders, prior to 1:00 P.M., New York City
time, on the date on which the bids are submitted, the member or members to
which, in the opinion of the Company's counsel, the Debentures may not be
lawfully sold have withdrawn from the group and the remaining members have
agreed to purchase the Debentures which such withdrawing member or members had
offered to purchase.
<PAGE>
 
                                      -4-


7.  Purchase Agreement and Completion of Registration Statement.

          The Company will signify its acceptance of a bid by signing the
Purchase Agreement.  The Company shall, upon request, execute the acceptance on
additional number of copies of the Purchase Agreement as shall be reasonably
requested by the Representative of the successful bidders.  Upon the acceptance
of a bid, the successful Sole Bidder, or, in the case of a bid by a group of
bidders, the Representative on behalf of the successful bidders, shall furnish
to the Company, in writing, all information regarding the bidder or bidders and
the public offering, if any, of the Debentures required in connection with the
prospectus supplement to the Registration Statement, any further information
regarding the bidders and the public offering, if any, to be made by them, which
may be required to complete the applications filed by the Company with public
authorities having jurisdiction over the Company, and other information required
by law in respect of the purchase or sale of the Debentures as herein
contemplated.

8.  Delivery of the Debentures.

          The Debentures will be delivered in temporary or definitive form, at
the election of the Company, to the purchasers of the Debentures at the place,
at the time and in the manner indicated in the Purchase Agreement, against
payment of the purchase price therefor as provided in the Purchase Agreement.

9.  Opinion of Counsel for the Purchasers.

          Messrs. Milbank, Tweed, Hadley & McCloy, 1 Chase Manhattan Plaza, New
York, N.Y. 10005, have been requested by the Company to act as counsel for the
successful bidder or bidders of the Debentures and to give to the purchasers an
opinion as outlined in the Purchase Agreement.  Such counsel has reviewed or
will review, from the standpoint of possible purchasers of the Debentures, the
form of the Registration Statement and the Prospectus and competitive bidding
papers, including the Purchase Agreement, and has reviewed or will review the
corporate proceedings with respect to the issue and sale of the Debentures.
Invited Bidders may confer with Messrs. Milbank, Tweed, Hadley & McCloy with
respect to any of the foregoing matters at the offices of said firm, 1 Chase
Manhattan Plaza, New York, N.Y. 10005, Attn.: Robert W. Mullen, Jr., Esq.  The
successful bidders are to pay the compensation and disbursements of such
counsel, except as otherwise provided in the Purchase Agreement.  Such counsel
will, on request, advise any Sole Bidder who has, or the Representative of any
group of bidders who have, furnished questionnaires as provided in Section 2
hereof, of the amount of such compensation and of the estimated amount of such
disbursements.


                                    GTE CALIFORNIA INCORPORATED

 
 


_________, 199_
<PAGE>
 
                                                         EXHIBIT A
                          GTE CALIFORNIA INCORPORATED
                                (the "Company")


                            CONFIRMATION OF BID FOR


             $___,000,000 ____% Debentures, Series ____, Due ____
                              (the "Debentures")

                                     TERMS
                                        

Maturity:  _______, ____.

Interest Payable:  Semi-annually on _______ and _______, commencing
                    _______.

Redemption Provisions:

          [The Debentures will not be redeemable prior to maturity.]

                                       OR

          [The New Debentures will not be redeemable prior to ________. The
"initial regular redemption price" of the New Debentures will be the initial
public offering price as defined below plus the rate of interest on the New
Debentures; the redemption price during the twelve-month period beginning ___
and during the twelve-month periods beginning on each ______ thereafter through
the twelve-month period beginning ______, will be determined by reducing the
initial regular redemption price by an amount determined by multiplying (a) 1/_
of the amount by which such initial regular redemption price exceeds 100% by (b)
the number of such full twelve-month periods which shall have elapsed between
______ and the date fixed for redemption; and thereafter the redemption prices
during the twelve-month periods beginning ______ shall be 100%; provided,
however, that all such prices will be specified to the nearest 0.01% or if there
is no nearest 0.01%, then to the next higher 0.01%.

          For the purpose of determining the redemption prices of the New
Debentures, the initial public offering price of the New Debentures shall be the
price, expressed in percentage of principal amount (exclusive of accrued
interest), at which the New Debentures are to be initially offered for sale to
the public; if there is not a public offering of the New Debentures, the initial
public offering price of the New Debentures shall be deemed to be the price,
expressed in percentage of principal amount (exclusive of accrued interest), to
be paid to the Company by the purchasers.]


NAME OF BIDDER:  _________________________________________________________

TELEPHONE NUMBER TO BE USED TO CALL IN BID:  _____________________________

TIME AND DATE BID RECEIVED:  _____________________________________________
     (to be completed by GTE Service Corporation on behalf of the Company)
<PAGE>
 
                                      -2-


By submitting this bid, the bidder named above agrees to the following terms and
conditions:

o  Each bid shall be for the purchase of all of the Debentures.

o  Each bid may be made by a single bidder or by a group of bidders.

o  The bidder acknowledges that it (and all members of the bidding group it
   represents) has received a copy of the Prospectus dated ________________.

o  If the bid is made by a group of bidders, the undersigned represents and
   warrants that it is fully authorized by all bidders in the group to act on
   their behalf and to bind them to the terms of the Purchase Agreement relating
   to the Debentures.

o  Each bid shall specify:

      -  the annual interest rate on the Debentures, which rate shall be a
         multiple of 1/8% or 0.01%;

      -  the price (exclusive of accrued interest) to be paid to the Company for
         the Debentures, which price shall not be less than 98% and not more
         than 100% of the principal amount of the Debentures, and that accrued
         interest on the Debentures from _______, to the date of payment of the
         Debentures and the delivery thereof will be paid to the Company by the
         purchaser or purchasers; and

      -  in the case of a bid by a group of bidders, the name of, and amount to
         be purchased by each bidder;

o  Bids must be received by 10:15 A.M., New York City time, on _______, or such
   later time and/or date as the Company may specify (the "Bid Time").

o  Bids shall be irrevocable for one (1) hour after the Bid Time.

o  The winning bid shall be selected on the basis of the lowest "annual cost of
   money" to the Company.

o  Whether or not this bid is accepted by the Company, an executed copy of this
   Confirmation of Bid must be sent promptly by facsimile to GTE Service
   Corporation on behalf of the Company at 203-965-2937 or 203-965-____.

o  If this bid is accepted, upon acceptance the undersigned agrees to promptly
   furnish to the Company a signed copy of the Purchase Agreement relating to
   the Debentures and a copy of all information required to be included in the
   Prospectus relating to the Debentures.

o  Closing Date:  _______ at 10:00 A.M., New York City time.
<PAGE>
 
                                      -3-


BID:

   Interest Rate  ________________ %

   Price to be paid to the Company  ________________ %

 

                                ___________________________________
                                    (Name of Bidder)



                                __________________________________
                                   (Authorized Signature)


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