-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, NsW6Bxg4x1f1z6jb+eTzT8VlGKX68OkhPaUcZBavHPpLnM47bjkfYC40yvIhWC0W e9qpR0iCw+z3UGDTS6c86g== 0000821130-94-000011.txt : 19941109 0000821130-94-000011.hdr.sgml : 19941109 ACCESSION NUMBER: 0000821130-94-000011 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19941108 EFFECTIVENESS DATE: 19941127 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: UNITED STATES CELLULAR CORP CENTRAL INDEX KEY: 0000821130 STANDARD INDUSTRIAL CLASSIFICATION: 4812 IRS NUMBER: 621147325 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 033-56361 FILM NUMBER: 94558103 BUSINESS ADDRESS: STREET 1: 8410 W BRYN MAWR AVE STREET 2: STE 700 CITY: CHICAGO STATE: IL ZIP: 60631 BUSINESS PHONE: 3123998900 MAIL ADDRESS: STREET 1: 301 S. WESTFIELD ROAD STREET 2: P.O. BOX 5158 CITY: MADISON STATE: WI ZIP: 53705-0158 S-8 1 FORMS8 Registration No. 33- - ----------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________ FORM S-8 REGISTRATION STATEMENT Under the SECURITIES ACT OF 1933 _______________ UNITED STATES CELLULAR CORPORATION (Exact name of registrant as specified in its charter) Delaware 62-1147325 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 8410 West Bryn Mawr, Suite 700 Chicago, Illinois 60631 (Address of Principal Executive Offices) (Zip Code) United States Cellular Corporation 1994 Employee Stock Purchase Plan (Full title of the plan) H. Donald Nelson President United States Cellular Corporation 8410 West Bryn Mawr, Suite 700 Chicago, Illinois 60631 (Name and address of agent for service) (312) 399-8900 (Telephone number, including area code, of agent for service) _______________ CALCULATION OF REGISTRATION FEE Proposed Proposed Title of Maximum Maximum Securities Amount Offering Aggregate Amount of to be to be Price Per Offering Registration Registered Registered Share (1) Price Fee Common Shares $1.00 par value 90,000 shares $ 32.125 $ 2,891,250 $ 997 (1) Estimated for the Common Shares solely for the purpose of calculating the registration fee on the basis of the average of the high and low prices of the Common Shares of the Company on the American Stock Exchange on November 4, 1994. PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS Item 1. Plan Information* ----------------- Item 2. Registrant Information and Employee Plan Annual Information* ------------------------------------------------------------ * Information required by Part I to be contained in the Section 10(a) prospectus is omitted from the Registration Statement in accordance with Rule 428 under the Securities Act of 1933, as amended (the "Securities Act") and the Note to Part I of Form S-8. PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. ----------------------------------------- The following documents which have heretofore been filed by United States Cellular Corporation (the "Company" or the "Registrant"), with the Securities and Exchange Commission (the "Commission") pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are incorporated by reference herein and shall be deemed to be a part hereof: 1. The Company's Annual Report on Form 10-K as amended by form 10-K/A-1 as filed on November 7, 1994, for the year ended December 31, 1993; 2. The Company's Quarterly Reports on Form 10-Q for the quarters ended March 31 and June 30, 1994; 3. The Company's Current Reports on Form 8-K, dated February 7 and March 30, 1994; and 4. The description of the Common Shares, par value $1.00 per share ("Common Shares"), of the Company contained in the Company's Amendment No. 2 on Form 8, dated December 28, 1992, to the Company's Report on Form 8-A. All documents, subsequently filed by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment to this Registration Statement which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and made a part hereof from their respective dates of filing (such documents, and the documents enumerated above, being hereinafter referred to as "Incorporated Documents"). Any statement contained in an Incorporated Document shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained herein or in any other subsequently filed Incorporated Document modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement. Item 4. Description of Securities. ------------------------- See Item 3. Item 5. Interests of Named Experts and Counsel. -------------------------------------- The legality of the Common Shares offered hereby is being passed upon for the Company by Sidley & Austin, One First National Plaza, Chicago, Illinois 60603. The Company is controlled by Telephone and Data Systems, Inc. ("TDS") and TDS is controlled by a voting trust. Walter C.D. Carlson, a trustee and beneficiary of the voting trust and a director of TDS, the Company and certain other subsidiaries of TDS, Michael G. Hron, the Secretary of TDS and certain other subsidiaries of TDS, Stephen P. Fitzell, the Secretary of the Company and certain other subsidiaries of TDS, and Sherry S. Treston, the Assistant Secretary of the Company and certain other subsidiaries of TDS, are partners of Sidley & Austin. Item 6. Indemnification of Directors and Officers. ------------------------------------------ The Company's Restated Certificate of Incorporation contains a provision providing that no director or officer of the Company shall be personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director or officer except for breach of the director's or officer's duty of loyalty to the Company or its stockholders, acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, unlawful payment of dividends, unlawful stock redemptions or repurchases and transactions from which the director or officer derived an improper personal benefit. Section 145 of the General Corporation Law of Delaware permits indemnification of directors, officers and employees of a corporation under certain conditions and subject to certain limitations. Article XI of the Company's Restated Certificate of Incorporation, as amended, contains provisions for the indemnification of directors, officers and employees of the Company within the limitations permitted by Section 145. Section 145 of the General Corporation Law of Delaware contains provisions permitting (and, in some situations, requiring) Delaware corporations such as the Company to provide indemnification to their officers and directors for losses and litigation expense incurred in connection with, among other things, their service to the corporation in those capacities. Among other things, these provisions provide that the Company is required to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (including any action by or in the right of the Company) (a "Proceeding") by reason of the fact that he is or was a director, officer or employee of the Company, or is or was serving at the request of the Company as a director, officer or employee of another corporation, partnership, joint venture, trust or other enterprise (including service with respect to any employee benefit plan) against expenses (including attorney's fees), judgments, fines, ERISA excise taxes, penalties and amounts paid in settlement actually and reasonably incurred by him in connection with such Proceeding to the fullest extent permitted by the Delaware General Corporation Law, as the same exists or may be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Company to provide broader indemnification rights than such law permitted the Company to provide prior to such amendment). These provisions also provide for the advance payment of fees and expenses reasonably incurred by the director or officer in defense of any such Proceeding, subject to reimbursement by the director or officer if it is ultimately determined that such officer or director is not entitled to be indemnified by the Company. The Company has directors' and officers' liability insurance which provides, subject to certain policy limits, deductible amounts and exclusions, coverage for all persons who have been, are or may in the future be, directors or officers of the Company, against amounts which such persons must pay resulting from claims against them by reason of their being such directors or officers during the policy period for certain breaches of duty, omissions or other acts done or wrongfully attempted or alleged. Item 7. Exemption from Registration Claimed. ------------------------------------ Not Applicable. -2- Item 8. Exhibits. --------- The exhibits accompanying this Registration Statement are listed on the accompanying Exhibit Index. The Plan is not intended to be qualified under Section 401(a) of the Internal Revenue Code. Item 9. Undertakings. ------------- 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: (a) To include any prospectus required by Section 10(a)(3) of the Securities Act; (b) 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; (c) 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 1.(a) and 1.(b) do 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 Securities 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 Common Shares being registered hereby which remain unsold at the termination of the offering. 4. That, for the purposes of determining any liability under the Securities Act, each filing of the Company's Annual Report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of 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 hereof. 5. That, insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, the Company has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Company of expenses incurred or paid by a director, officer or controlling person of the Company in the successful defense of any action, suit or proceeding) is asserted by such director, -3- officer 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 Securities Act and will be governed by the final adjudication of such issue. -4- 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-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Chicago, State of Illinois, on the 8th day of November, 1994. UNITED STATES CELLULAR CORPORATION By: /s/ H. Donald Nelson -------------------------------- H. Donald Nelson President Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated and on the 8th day of November, 1994. /s/ LeRoy T. Carlson, Jr. Chairman and Director - ------------------------- LeRoy T. Carlson, Jr. /s/ H. Donald Nelson President (Principal Executive - ------------------------- Officer) and Director H. Donald Nelson /s/ LeRoy T. Carlson Director - ------------------------- LeRoy T. Carlson /s/ Murray L. Swanson Director - ------------------------ Murray L. Swanson /s/ Paul-Henri Denuit Director - ------------------------ Paul-Henri Denuit /s/ Allan Z. Loren Director - ------------------------ Allan Z. Loren /s/ Walter C.D. Carlson Director - ------------------------ Walter C.D. Carlson /s/ Kenneth R. Meyers Vice President - Finance and - ------------------------ Treasurer (Principal Financial Kenneth R. Meyers Officer) /s/ Phillip A. Lorenzini Controller (Principal - ------------------------ Accounting Officer) Phillip A. Lorenzini -5- EXHIBIT INDEX The following documents are filed herewith or incorporated herein by reference. Exhibit No. Description - ------- ----------- 4.1 Restated Certificate of Incorporation, as amended, of the Company (Incorporated herein by reference to Exhibit 2(a) to Amendment No. 2 on Form 8 dated December 28, 1992 to the Company's Report on Form 8-A). 4.2 Restated Bylaws, as amended, of the Company (Incorporated herein by reference to Exhibit 2(b) to Amendment No. 2 on Form 8 dated December 28, 1992 to the Company's Report on Form 8-A). 5 Opinion of Sidley & Austin. 23.1 Consent of Independent Public Accountants. 23.2 Consents of Independent Accountants. 23.3 Consent of Sidley & Austin (contained in Exhibit 5 hereto). 99.1 United States Cellular Corporation 1994 Employee Stock Purchase Plan. EX-5 2 EXHIBIT5 EXHIBIT 5 SIDLEY & AUSTIN ONE FIRST NATIONAL PLAZA CHICAGO, ILLINOIS 60603 November 8, 1994 United States Cellular Corporation Suite 700 8410 West Bryn Mawr Avenue Chicago, Illinois 60631 Re: United States Cellular Corporation Registration Statement on Form S-8 ---------------------------------- Gentlemen: We are counsel to United States Cellular Corporation, a Delaware corporation (the "Company"), and have represented the Company in connection with the Registration Statement on Form S-8 (the "Registration Statement") being filed by the Company with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "Securities Act"), with respect to the offer and sale of 90,000 shares, par value $1.00 per share (the "Common Shares"), of the Company pursuant to the United States Cellular Corporation 1994 Employee Stock Purchase Plan (the "Plan"). In rendering this opinion, we have examined and relied upon a copy of the Plan and the Registration Statement, including the related Prospectus dated the date hereof. We have also examined and relied upon originals, or copies of originals certified to our satisfaction, of such agreements, documents, certificates and other statements of governmental officials and other instruments, and examined such questions of law and have satisfied ourselves as to such matters of fact, as we have considered relevant and necessary as a basis for this opinion. We have assumed the authenticity of all documents submitted to us as originals, the genuineness of all signatures, the legal capacity of all natural persons and the conformity with the original documents of any copies thereof submitted to us for our examination. Based on the foregoing, we are of the opinion that: 1. The Company is duly incorporated and validly existing under the laws of the State of Delaware; and 2. The Common Shares will be legally issued, fully paid and nonassessable when: (i) the Registration Statement shall have become effective under the Securities Act; (ii) the Common Shares shall have been duly issued and sold in the manner contemplated by the Plan; and (iii) certificates representing the Common Shares shall have been duly executed, countersigned and registered and duly delivered to the purchasers thereof against payment of the agreed consideration therefor. United States Cellular Corporation November 8, 1994 Page 2 We do not find it necessary for the purposes of this opinion to cover, and accordingly we express no opinion as to, the application of the securities or "Blue Sky" laws of the various states to the sale of the Common Shares. The Company is controlled by Telephone and Data Systems, Inc. ("TDS") and TDS is controlled by a voting trust. Walter C.D. Carlson, a trustee and beneficiary of the voting trust and a director of TDS, the Company and certain other subsidiaries of TDS, Michael G. Hron, the Secretary of TDS and of certain other subsidiaries of TDS, Stephen P. Fitzell, the Secretary of the Company and certain other subsidiaries of TDS, and Sherry S. Treston, the Assistant Secretary of the Company and certain other subsidiaries of TDS, are partners of this Firm. This opinion is being delivered in connection with the Registration Statement and, accordingly, may not be utilized for any other purpose without our prior written consent. We assume no obligation to update or supplement this opinion to reflect any facts or circumstances which may hereafter come to our attention with respect to the opinions expressed above, including any changes in applicable law which may hereafter occur. We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to all references to our Firm in or made a part of the Registration Statement. Very truly yours, SIDLEY & AUSTIN EX-23 3 EXHIBIT23 EXHIBIT 23.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this Form S-8 Registration Statement of United States Cellular Corporation of our report dated February 7, 1994 (except with respect to the matters discussed in the fifth, seventh and eighth paragraphs of Note 3, as to which the date is October 17, 1994), on the consolidated financial statements of United States Cellular Corporation and Subsidiaries, to the incorporation by reference in this Form S-8 Registration Statement of United States Cellular Corporation of our report dated February 7, 1994 (except with respect to the matters discussed in the fifth, seventh, and eighth paragraphs of Note 3, as to which the date is October 17, 1994), on the financial statement schedules of the Company and to the incorporation by reference in this Form S-8 Registration Statement of our compilation report dated February 11, 1994 (except with respect to the matters discussed in the third, fifth and sixth paragraphs of Note 7, as to which the date is October 17, 1994), on the combined financial statements of the Los Angeles SMSA Limited Partnership, the Nashville/Clarksville MSA Limited Partnership and the Baton Rouge MSA Limited Partnership, included or incorporated by reference in the United States Cellular Corporation Form 10-K for the year ended December 31, 1993. We also consent to all references to our Firm included in this Form S-8 Registration Statement. ARTHUR ANDERSEN LLP Chicago, Illinois November 2, 1994 EX-23 4 EXHIBIT23 EXHIBIT 23.2 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Form S-8 Registration Statement of United States Cellular Corporation of our report, which includes explanatory paragraphs relating to contingencies, dated February 4, 1994, except for the information presented in paragraphs three, five and six of Note 9, as to which the date is October 17, 1994, on our audits of the financial statements of the Los Angeles SMSA Limited Partnership as of December 31, 1993 and 1992, and for each of the three years in the period ended December 31, 1993, included in the United States Cellular Corporation Annual Report on Form 10-K/A-1 for the year ended December 31, 1993; such financial statements were not included separately in such Form 10-K/A-1. COOPERS & LYBRAND L.L.P. Newport Beach, California November 2, 1994 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Form S-8 Registration Statement of United States Cellular Corporation of our reports dated February 11, 1994, February 11, 1993 and February 10, 1992, respectively, on our audits of the financial statements of the Nashville/Clarksville MSA Limited Partnership as of December 31, 1993, 1992 and 1991 and for the years ended December 31, 1993, 1992 and 1991, included in the United States Cellular Corporation Annual Report on Form 10-K for the year ended December 31, 1993; such financial statements were not included separately in such Form 10-K. COOPERS & LYBRAND L.L.P. Atlanta, Georgia November 2, 1994 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Form S-8 Registration Statement of United States Cellular Corporation of our reports dated February 11, 1994, February 11, 1993 and February 10, 1992, respectively, on our audits of the financial statements of the Baton Rouge MSA Limited Partnership as of December 31, 1993, 1992 and 1991 and for the years ended December 31, 1993, 1992 and 1991, included in the United States Cellular Corporation Annual Report on Form 10-K for the year ended December 31, 1993; such financial statements were not included separately in such Form 10-K. COOPERS & LYBRAND L.L.P. Atlanta, Georgia November 2, 1994 EX-99 5 EXHIBIT99 EXHIBIT 99.1 UNITED STATES CELLULAR CORPORATION 1994 EMPLOYEE STOCK PURCHASE PLAN SECTION 1. ESTABLISHMENT; PURPOSE; SCOPE. ------------------------------- United States Cellular Corporation hereby establishes the United States Cellular Corporation 1994 Employee Stock Purchase Plan to encourage and facilitate the purchase of Common Shares of the Company by eligible employees. The Plan is intended to provide a further incentive for eligible employees to promote the best interests of the Controlled Group and an additional opportunity to participate in its economic progress. It is the intention of the Company to have the Plan qualify as an "employee stock purchase plan" within the meaning of Section 423 of the Internal Revenue Code of 1986, as amended (the "Code"), and provisions of the Plan shall be construed in a manner consistent with the Code. SECTION 2. DEFINITIONS; CONSTRUCTION. -------------------------- As used in this Plan, as of any time of reference, and unless the context otherwise requires: (a) "Affiliate" means any trade or business entity which is a member of a controlled group with Telephone and Data Systems, Inc. ("TDS") (as described in Section 414(b) and (c) of the Code) or is a member of an affiliated service group with TDS (as described in Section 414(m) of the Code) and any other entity required to be aggregated with TDS pursuant to final regulations under Section 414(o) of the Code. (b) "Board" means the Board of Directors of the Company as from time to time constituted. (c) "Common Shares" means the common shares, par value $1.00 per share, of the Company. (d) "Company" means United States Cellular Corporation, a Delaware corporation, and any successor thereto. (e) "Controlled Group" means the Company and its Subsidiaries. (f) "Effective Date" means October 1, 1994. (g) "Employer" means the Company and any corporation that is a member of the Controlled Group that adopts the Plan with the prior approval of the Company, as evidenced by a resolution of the Board. (h) "Fair Market Value" means the average closing price of a Common Share on the American Stock Exchange on the twenty business days preceding the date of reference . (i) "Offering Price" means 85 percent of the Fair Market Value of a Common Share on the Effective Date, i.e., $26.94 (85% x $31.69). (j) "Participant" means any employee of an Employer who meets the eligibility requirements of Section 4 and who has accepted an offer made by the Committee pursuant to Section 6(b) hereof. (k) "Plan" means the 1994 Employee Stock Purchase Plan herein set forth and any amendment or supplement thereto. (l) "Purchase Date" means December 31, 1995 or December 31, 1996, as the case may be. (m) "Subsidiary" means a corporation (other than the Company) in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50 percent or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. (n) "Termination Date" means December 31, 1996, or earlier at the discretion of the Board. The masculine gender, when appearing in this Plan, shall be deemed to include the feminine gender unless the context clearly indicates to the contrary. The words "hereof," "herein," and "hereunder," and other similar compounds of the word "here," shall mean and refer to the entire Plan and not to any particular provision or section of this document. SECTION 3. ADMINISTRATION. --------------- This Plan shall be administered by the 1994 Employee Stock Purchase Plan Committee (hereinafter referred to as the "Committee"), the members of which shall be two individuals selected by the Board who do not satisfy the eligibility requirements of Section 4 hereunder. Pursuant to resolution approved by the Board, as of the adoption date, the Committee shall be comprised of LeRoy T. Carlson, Jr. and Murray L. Swanson. Subject to the express provisions hereof, the Committee shall have complete authority to interpret this Plan, to prescribe, amend and rescind rules and regulations relating to it and to make all other determinations necessary or advisable for the administration of this Plan. The Committee's determinations -2- on the matters referred to in this paragraph shall be conclusive. No member of the Committee shall be personally liable for any decision or determination made in good faith under the Plan. SECTION 4. ELIGIBILITY. ------------ (a) Any employee of an Employer shall be eligible to participate in the Plan, provided he has at least six (6) months of continuous service with an Employer immediately prior to January 1, 1995. For the sole purpose of calculating length of service under the Plan, employees shall be credited for service with an Employer immediately prior to the Company's acquisition of such Employer or other member of the Controlled Group and for service with TDS, or any Affiliate thereof. No eligibility provision hereof shall permit or deny participation in the Plan in a manner contrary to the applicable requirements of the Code and the regulations promulgated thereunder. (b) Notwithstanding anything herein to the contrary, no employee shall be entitled to participate in the Plan if such employee, immediately after the grant of an option would own shares (including shares which may be purchased under the Plan) possessing five percent or more of the total combined voting power or value of all classes of stock of the Company, its Subsidiaries, TDS or TDS' Subsidiaries actually issued and outstanding immediately after such grant. For the foregoing purposes, the rules of stock attribution set forth in Section 424(d) of the Code shall apply in determining share ownership. SECTION 5. PURCHASE PRICE. --------------- The purchase price shall be the lesser of (i) the Offering Price or (ii) the Fair Market Value of a Common Share on the Purchase Date. SECTION 6. NUMBER OF COMMON SHARES OFFERED. -------------------------------- (a) The maximum number of shares which shall be available for purchase under the Plan shall be 90,000 Common Shares of the Company, subject to adjustment as provided in Section 14. The Common Shares to be sold under this Plan may at the election of the Company be either treasury shares or shares originally issued for such purpose. (b) An employee shall be entitled to elect to purchase a total number of shares equal to one share for each $150.00 of his compensation ("base shares") plus any number of additional shares up to a maximum of 200 percent of his base shares ("additional shares"), provided that no employee may purchase fewer than twenty shares. If the total of an employee's base shares and additional shares is less than twenty, the employee nevertheless shall be entitled to elect to purchase twenty shares. For purposes of this subsection, compensation means (i) -3- for a sales consultant, the greater of $25,000 or 200 percent of all of his base salary and commissions paid by an Employer during the period beginning April 1, 1994, and ending September 30, 1994 (the "compensation period"), (ii) for a market manager, 145 percent of his base salary in effect at July 1, 1994, (iii) for a part-time employee, 200 percent of all remuneration paid to him by an Employer during such compensation period, (iv) for any hourly full-time employee, the hourly rate in effect as of July 1, 1994 multiplied by the number of regular hours in a work year, and (v) for any salaried employee, the annual salary in effect at July 1, 1994. Amounts which are not included in an employee's income for federal income tax purposes due to Section 125 or 402(e)(3) of the Code shall be included in determining base salary, commissions and remuneration, for purposes of items (i)-(v) above. (c) No Participant shall be granted an option to purchase shares under the Plan that permits the Participant to purchase shares in any calendar year under the Plan and other employee stock purchase plans (within the meaning of Section 423 of the Code) of the Company, its Subsidiaries and TDS, and TDS' Subsidiaries, with an aggregate fair market value (determined at the time such option is granted) in excess of $25,000. (d) In the event that Participants elect to purchase more shares than are available under clause (a) above, the maximum percentage of base shares that any Participant shall be permitted to purchase as additional shares shall be reduced until the total number of shares that all Participants, in the aggregate, have elected to purchase pursuant to clause (b) above (after reducing the number of additional shares elected by each Participant whose election reflects a maximum percentage in excess of the revised maximum percentage) equals the number of shares available under clause (a) above. The number of additional shares elected by each Participant who has elected more than the revised maximum shall be reduced so that no Participant may purchase more additional shares than the revised maximum percentage of base shares. Notwithstanding the preceding sentences of this clause (d), no Participant may purchase fewer than twenty shares. SECTION 7. ENROLLMENT PERIOD; EMPLOYEE'S ELECTION TO PARTICIPATE. ------------------------------------------ (a) The Committee shall establish an enrollment period, during which an eligible employee may elect to purchase shares by executing and delivering to the TDS Employee Benefits Division an enrollment and payroll deduction authorization form. (b) An election to purchase shall not constitute a contract to purchase. Such an election shall merely notify the -4- Company of the number of shares to be held for purchase by the Participant. SECTION 8. PURCHASE PERIOD; PAYMENT FOR SHARES. ------------------------------------ (a) The "Purchase Period" shall commence on January 1, 1995 and shall end on the earliest of the following dates: (i) the Termination Date, (ii) the date the Participant elects to abandon his purchase, and (iii) the date the Participant terminates service with the Employer. (b) Concurrently with his election, the Participant shall authorize a payroll deduction in an amount that over the Purchase Period shall provide for full payment for each share which he elects to purchase. (c) All payroll deductions held by the Company under the Plan shall be held without interest. (d) Subject to each Participant's right to abandon Common Shares pursuant to Section 10 hereof, the Company shall purchase Common Shares on behalf of each Participant pursuant to Section 9 hereof as soon as is administratively practicable after each Purchase Date. (e) All payroll deductions in the possession of the Company shall be segregated from the general funds of the Company in an account established to hold such payroll deductions (hereinafter referred to as the "Employee Stock Purchase Plan Account"). The Employee Stock Purchase Plan Account shall be restricted to the uses provided herein until such time as the Company issues certificates to Participants purchasing Common Shares under the Plan. The Committee shall have custody of such account. SECTION 9. ISSUANCE AND DELIVERY OF STOCK CERTIFICATES; REGISTRATION. --------------------------------------------- (a) Certificates for Common Shares shall be issued and delivered to each Participant for the number of Common Shares paid for in full as soon as is administratively practicable after each Purchase Date. No fractional shares will be issued at any time. (b) As and whenever the Common Shares are issued to Participants pursuant to this Section 9, the Committee shall remit to the Company for its general purposes, out of the Employee Stock Purchase Plan Account, cash in an amount equal to the purchase price under the Plan of the Common Shares so issued. When all Common Shares purchasable under the Plan have been issued, any payroll deductions that have not been used to purchase Common Shares shall be returned to each Participant in accordance with his payroll deduction authorization under Section -5- 7(a) and his exercise of his right to abandon Common Shares pursuant to Section 10. (c) Shares to be delivered to a Participant under the Plan shall be registered in the name of the Participant or, if the Participant so directs by written notice to the TDS Employee Benefits Division prior to the issuance thereof, in the names of the Participant and one other person as the Participant may designate, as joint tenants with right of survivorship. SECTION 10. PARTICIPANT'S RIGHT TO ABANDON SHARES. -------------------------------------- At any time during the term of the Plan a Participant may elect to abandon all or any number of the Common Shares then purchasable by and not yet issued to him, provided that a Participant may not retain the right to purchase fewer than twenty Common Shares. As to any Common Shares so abandoned, the Participant shall have no further rights of any nature at any subsequent time. If the Participant retains the right to purchase a lesser number of Common Shares, his election will continue with respect to such lesser number of Common Shares and any amount in the Employee Stock Purchase Plan Account contributed by the Participant that exceeds the amount necessary to purchase such lesser number of Common Shares shall be refunded to the Participant. If the Participant retains no right to purchase Common Shares, any amount in the Employee Stock Purchase Plan Account contributed by the Participant shall be refunded to the Participant. SECTION 11. EMPLOYEE'S HARDSHIP WITHDRAWAL. ------------------------------- If a Participant makes a hardship withdrawal from any plan with a cash or deferred arrangement qualified under Section 401(k) of the Code which plan is sponsored, or participated in, by any Employer, such Participant shall be prohibited from making contributions under this Plan for a period of twelve months from the date of such withdrawal. If, after the expiration of such twelve month period, the Purchase Period has not yet expired, the Participant shall be permitted to resume payroll deductions in an amount which over the remaining Purchase Period shall provide for full payment for each share which he has elected to purchase and for which he has not yet made payroll deductions. SECTION 12. TERMINATION OF EMPLOYMENT OR ELIGIBILITY. ----------------------------------------- (a) "Retirement or Death". Upon termination of employment because of retirement or death, the number of Common Shares paid for in full by the Participant upon the application of all accumulated payroll deductions, including from compensation due and owing, shall be purchased for the Participant (or, in the case of the Participant's death, the beneficiary designated by the Participant in accordance with procedures prescribed by the Committee, or if no such beneficiary designation is in effect with respect to such Participant, the Participant's estate), unless the Participant (or, in the case of the Participant's death, his designated beneficiary or estate, as the case may be) elects to abandon all or any such number of -6- the Common Shares then purchasable, pursuant to Section 10 hereof and any rules or regulations the Committee shall make. (b) "Other Termination of Employment". Upon termination of employment with an Employer for any reason other than as a result of retirement or death as described in clause (a) of this Section, the amount withheld from the Participant's pay pursuant to Section 8 which has not already been used to purchase Common Shares shall be returned to him as soon as administratively practicable. SECTION 13. RIGHTS NOT TRANSFERABLE. ------------------------ The right to purchase Common Shares under this Plan shall not be transferable by any Participant or exercisable, during his lifetime, by any person other than the Participant. SECTION 14. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE. ------------------------------------------- (a) The existence of the Plan shall not affect in any way the right or power of the Company or its shareholders to make or authorize any adjustment, recapitalization, reorganization or other change in the Company's capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock that affects the Common Shares or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. (b) If, during the term of the Plan, the Company shall effect (i) a distribution or payment of a dividend on its Common Shares in shares of the Company, (ii) a subdivision of its outstanding Common Shares by a stock split or otherwise, (iii) a combination of the outstanding Common Shares into a smaller number of shares by a reverse stock split or otherwise, or (iv) an issuance by reclassification or other reorganization of its Common Shares (other than by merger or consolidation) of any shares of the Company, then each Participant shall be entitled to receive upon the purchase of shares pursuant to this Plan such shares of the Company which the Participant would have owned or would have been entitled to receive after the happening of such event had the Participant purchased Common Shares pursuant to the Plan immediately prior to the happening of such event. If any other event shall occur that, in the judgment of the Board, necessitates adjusting the Offering Price, the number of Common Shares offered or other terms of the Plan, the Board shall take any action that in its judgment shall be necessary to preserve each Participant's rights substantially proportionate to the rights existing prior to such event. To the extent that any event or action pursuant to this paragraph shall entitle Participants to purchase additional Common Shares or other shares of the Company, the shares available under Section 6 shall be deemed to include such additional Common Shares or such other shares of the Company. (c) In the event of a merger of one or more corporations into the Company, or a consolidation of the Company and one or more corporations in which the Company shall be the surviving corporation, each Participant in the Plan shall, at no additional cost, be entitled, upon his payment for all or part of -7- the Common Shares purchasable by him under the Plan, to receive (subject to any required action by shareholders) in lieu of the number of Common Shares which he was entitled to purchase, the number and class of shares of stock or other securities to which such holder would have been entitled pursuant to the terms of the agreement of merger or consolidation if, immediately prior to such merger or consolidation, such holder had been the holder of record of the number of Common Shares equal to the number of shares paid for by the Participant. (d) If the Company is merged into or consolidated with another corporation under circumstances where the Company is not the surviving corporation, or if the Company sells or otherwise disposes of substantially all its assets to another corporation during the term of the Plan: (i) subject to the provisions of clause (ii) below, after the effective date of such merger, consolidation or sale, as the case may be, each holder of a right to purchase shall be entitled to receive, upon his payment for all or part of the Common Shares purchasable by him under the Plan and receive in lieu of Common Shares, shares of such stock or other securities as the holders of Common Shares received pursuant to the terms of the merger, consolidation or sale; and (ii) all outstanding rights to purchase may be cancelled by the Board as of the effective date of any such merger, consolidation or sale, provided that (i) notice of such cancellation shall be given to each Participant and (ii) each such Participant shall have the right to purchase, during a 30-day period preceding the effective date of such merger, consolidation or sale, all or any part of the shares allocated to him under the terms of the Plan. (e) Except as hereinbefore expressly provided, the issue by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Common Shares then available for purchase under the Plan. SECTION 15. SHAREHOLDER APPROVAL. --------------------- The Plan is subject to the approval of a majority of the votes cast on the matter by the shareholders of the Company within twelve months before or after its adoption by the Board. SECTION 16. RIGHTS OF A SHAREHOLDER. ------------------------ No Participant shall have rights or privileges of a shareholder of the Company with respect to shares purchasable under this Plan unless and until the Participant shall become the holder of record of one or more Common Shares. -8- SECTION 17. NO REPURCHASE OF COMMON SHARES BY COMPANY. ----------------------------------------- The Company is not obligated to repurchase from any Participant Common Shares he has acquired under the Plan. SECTION 18. AMENDMENT OF THE PLAN. ---------------------- The Board may at any time, and from time to time, amend the Plan in any respect, except that, without the approval of the shareholders of the Company, no amendment may be made that changes the number of shares to be reserved under the Plan (other than as provided in Section 14) or the designation of Subsidiaries whose employees may be offered options under the Plan. SECTION 19. TERMINATION OF THE PLAN. ------------------------ While it is intended that the Plan remain in effect for the term of the Plan, the Board may terminate the Plan at any time in its discretion. Upon termination of the Plan, the Committee shall terminate payroll deductions and, unless the Participant elects to abandon his shares, shall issue and deliver to each Participant certificates for the number of Common Shares paid for in full. A Participant may elect, upon termination of the Plan, to abandon all or any number of the Common Shares then purchasable by and not yet issued to him, provided that a Participant may not retain the right to purchase fewer than twenty Common Shares. The Committee shall refund to the Participant any amount in the Employee Stock Purchase Plan Account contributed by the Participant that exceeds the amount necessary to purchase the number of Common Shares the Participant elects to purchase and not abandon. If the Participant retains no right to purchase Common Shares, the Committee shall refund to the Participant any amount in the Employee Stock Purchase Plan Account contributed by the Participant. Any contributions remaining in the Employee Stock Purchase Plan Account shall be refunded to the Participants making such contributions as soon as administratively practicable after termination of the Plan. SECTION 20. COMPLIANCE WITH STATUTES AND REGULATIONS. ---------------------------------------- The sale and delivery of Common Shares under the Plan shall be in compliance with relevant statutes and regulations of governmental authorities, including state securities laws and regulations, and with the regulations of applicable stock exchanges. SECTION 21. GOVERNING LAW. -------------- This Plan and all determinations made hereunder and action taken pursuant hereto shall be governed by the laws of the State of Delaware and construed in accordance therewith. -9- -----END PRIVACY-ENHANCED MESSAGE-----