SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the fiscal year ended December 31, 1995
or
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-4996
ALLTEL CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 34-0868285
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Allied Drive, Little Rock, Arkansas 72202
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (501) 661-8000
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
Common Stock New York and Pacific
$2.06 No Par Cumulative
Convertible Preferred Stock New York and Pacific
Securities registered pursuant to Section 12(g) of the Act:
NONE
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days.
YES X NO
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. (X)
Aggregate market value of voting stock held by non-affiliates as of
January 31, 1996 - $5,940,545,794
Common shares outstanding, January 31, 1996 - 189,340,105
DOCUMENTS INCORPORATED BY REFERENCE
Document Incorporated Into
Portions of the annual report to stockholders
for the year ended December 31, 1995 Parts I, II and IV
Proxy statement for the 1996 annual meeting
of stockholders Part III
The Exhibit Index is located on pages 22 to 26.
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
THE COMPANY
GENERAL
ALLTEL Corporation ("ALLTEL" or the "Company") was incorporated in June 1960
under the laws of Ohio as Mid-Continent Telephone Corporation. In 1983, the
Company changed its name to ALLTEL Corporation and during 1990 changed its
state of incorporation to Delaware.
ALLTEL is a diversified telecommunications and information services company.
The Company owns subsidiaries or investments that provide wireline local and
network access service, cellular telephone, wide-area paging and fiber
optic-based long-distance telephone service, and information processing
management services and advanced applications software. Telecommunications
products and electronic and electric wire and cable are warehoused and
sold by the Company's distribution subsidiaries. The Company also publishes
telephone directories for affiliates and other independent telephone companies.
ACQUISITIONS
During 1995, ALLTEL Mobile Communications, Inc. ("ALLTEL Mobile") entered into
a joint venture with BellSouth Mobility, Inc. involving cellular properties in
five states. As a result of this joint venture, ALLTEL Mobile now owns a 53.5
percent interest in the Columbia and Florence, South Carolina market, an 11.1
percent interest in the Greensboro, North Carolina Metropolitan Statistical
Area ("MSA"), an 11.1 percent interest in a North Carolina Rural Service Area
("RSA"), and no longer owns a majority interest in the Jackson, Mississippi
market. In addition during 1995, ALLTEL Mobile completed an exchange of
certain assets in a West Virginia RSA and an Oklahoma RSA for certain assets
in a Georgia RSA and a North Carolina RSA owned by United States Cellular Corp.
("U.S. Cellular"). The acquired properties are contiguous to ALLTEL Mobile's
Albany, Georgia and Charlotte, North Carolina markets. In January 1995,
ALLTEL Mobile purchased U.S. Cellular's 20 percent interest in the Fort Smith,
Arkansas, MSA, thereby increasing ALLTEL Mobile's ownership interest in the
Fort Smith MSA to 100 percent.
In May 1995, ALLTEL Information Services, Inc. acquired Vertex Business
Systems, Inc. ("Vertex"), a provider of international banking software products
and services. Vertex, headquartered in New York, has clients located in
Europe, Asia and the United States.
In November 1994, the Company completed its acquisition of Medical Data
Technology, Inc. ("MDT"). MDT provides information processing services to 14
hospitals in the northeastern United States utilizing comprehensive application
software developed by ALLTEL's healthcare information services subsidiary.
Effective November 1, 1993, the Company and GTE Corporation completed an
exchange of telephone service areas in several states. ALLTEL exchanged
approximately 95,000 access lines in Illinois, Indiana and Michigan and $443
million in cash for GTE's Georgia telephone operations, which served
approximately 320,000 access lines.
In October 1993, the Company completed its acquisition of TDS Healthcare
Systems Corporation ("TDS"). TDS is a provider of comprehensive patient care
and healthcare enterprise information systems serving more than 200 hospitals
in the United States, Canada and Europe. In 1994, TDS was merged into ALLTEL
Healthcare Information Services, Inc.
1
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
THE COMPANY (continued)
ACQUISITIONS (continued)
In October 1993, ALLTEL Publishing Corporation ("ALLTEL Publishing") completed
its purchase of GTE Directories Service Corporation's ("GTE Directories")
independent publishing business, which included contracts with more than 125
independent telephone companies across the country.
During 1993, ALLTEL Mobile acquired a 100 percent interest in one Georgia RSA
which had a population of approximately 145,000. In addition, ALLTEL Mobile
acquired interests in two other Georgia RSAs and increased its ownership in one
Texas RSA and one Mississippi RSA.
In January 1993, ALLTEL Mobile acquired an additional 20 percent interest in
the Ft. Smith, Arkansas MSA. This transaction increased ALLTEL Mobile's
interest in the Ft. Smith MSA to 80 percent.
During 1992, ALLTEL Mobile acquired a 60 percent interest and a 90 percent
interest in the Ft. Smith, Arkansas and Fayetteville, Arkansas MSAs,
respectively. In addition, ALLTEL Mobile increased its ownership to 100
percent in the Springfield, Missouri and Charlotte, North Carolina MSAs and to
64 percent in the Little Rock, Arkansas MSA. Also in 1992, ALLTEL Mobile
purchased an additional 42 percent interest in the Savannah, Georgia, MSA,
increasing its total interest to 80 percent, and acquired additional interests
in three Arkansas and Oklahoma RSAs, one Missouri RSA, and three Alabama RSAs.
In December 1992, the Company acquired SLT Communications, Inc. ("SLT"). SLT
served approximately 49,000 telephone customers primarily in suburban Houston.
It also had approximately 328,000 cellular "pops", including a 2.34 percent
ownership in the Houston, Galveston and Beaumont, Texas MSA, a 1 percent
interest in the Little Rock, Arkansas MSA, and interests in four Texas RSA
markets. SLT also owned several cable television properties and a one-third
interest in Metropolitan Houston Paging Services, which were subsequently sold
during 1995.
In February 1992, the Company acquired Computer Power, Inc. ("CPI") (now known
as ALLTEL Mortgage Information Services, Inc.), the nation's largest provider
of software and processing services to the mortgage industry. CPI has a
comprehensive set of proprietary software systems which includes the Mortgage
Servicing Package, Residential Loan Inventory Control Package, the Residential
Loan Production Control Package, and a number of related systems as well as
consulting, training, portfolio conversion and other services.
In 1991, the Company acquired Missouri Telephone Company. Missouri Telephone
Company served approximately 20,000 customer access lines and 3,400 cable
television customers in Missouri. It also had 320,000 cellular "pops"
including 48 percent ownership in the Springfield, Mo. MSA cellular market
where together with ALLTEL Mobile, the Company owns a 100 percent interest.
In early 1991, Systematics Information Services, Inc. ("Systematics") (now
known as ALLTEL Information Services, Inc.) acquired Systems Limited, an
international banking software firm headquartered in Hong Kong. Systems
Limited is a provider of wholesale banking software.
In January 1991, Systematics completed its acquisition of the cellular
telephone billing and information system software of C-TEC Corporation
("C-TEC"), an independent telecommunications company.
2
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
THE COMPANY (continued)
DISPOSITIONS
In November 1994, the Company signed definitive agreements to sell certain
telephone properties serving approximately 117,000 access lines in Arizona,
California, Nevada, New Mexico, Oregon, Tennessee, Utah and West Virginia to
Citizens Utilities Company ("Citizens") in exchange for approximately $290
million in cash and assumed debt and 3,600 access lines in Pennsylvania.
During 1995, the sale of all properties except for those in Nevada was
completed. The Company expects to complete the sale of the Nevada properties
in early 1996. Once completed, this transaction will result in the Company's
telephone operating subsidiaries serving approximately 1.6 million
access lines in 14 states.
In 1995, as part of its agreement to sell certain telephone properties, the
Company also completed the sale of certain of its cable television properties
to Citizens. These cable television properties served approximately
6,800 customers in Arizona, California, New Mexico and Utah. The Company also
completed in 1995 the sale of its cable television properties in Texas which
served approximately 7,200 customers. Following these sales, the Company
provides cable television service to approximately 3,400 customers, primarily
to residents of Bolivar and Stockton, Missouri.
In 1995, ALLTEL Information Services sold all of the assets related to its
check processing operations, including substantially all of the customer
contracts. The check processing operations were not part of the Company's
long-term growth strategy for its information services business.
In 1992, the Company sold substantially all of the assets of Ocean Technology,
Inc. ("OTI"), which designed, developed, manufactured and marketed products
for use in military command, control and communications systems. After the sale
of OTI, the Company did not have any manufacturing operations.
In 1991, the Company completed the sale of all of its natural gas operations.
MANAGEMENT
The Company's staff at its headquarters and regional offices supervise,
coordinate and assist subsidiaries in management activities, investor
relations, acquisitions, corporate planning, insurance, and technical research.
They also coordinate the financing program for the entire corporate system.
EMPLOYEES
At January 31, 1996, the Company had 15,698 employees. Some of the employees
of the Company's telephone subsidiaries are part of collective bargaining
units. The Company maintains good relations with all employee groups.
INDUSTRY SEGMENTS
Financial information about industry segments is included in the Company's 1995
Annual Report to Stockholders, which is incorporated herein by reference.
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<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
TELEPHONE OPERATIONS
LOCAL SERVICE
General
The Company's telephone operating subsidiaries provide local service to over
1,623,000 customer lines through 597 exchanges in 15 states. The telephone
operating subsidiaries also offer facilities for private line, data
transmission and other communications services.
Regulation
Historically, the Company's telephone operating subsidiaries have provided
local telephone service under franchises granted by state regulatory
commissions and have been subject to regulation by those regulatory
commissions. These regulatory commissions have had primary jurisdiction over
various matters including local and intrastate toll rates, quality of service,
the issuance of securities, depreciation rates, the disposition of public
utility property, the issuance of debt, and the accounting systems used by
those subsidiaries. The Federal Communications Commission ("FCC") has
historically had primary jurisdiction over the interstate toll and access
rates of these companies and issues related to interstate telephone service.
The Telecommunications Act of 1996 (the "96 Act"), which became effective on
February 8, 1996, has substantially modified both the states' and the FCC's
jurisdictions in the regulation of local exchange telephone companies. The
96 Act prohibits any state legislative or regulatory restrictions or barriers
to entry regarding the provision of local telephone service. The 96 Act
requires the FCC to develop regulations to implement various sections of the
96 Act within six months after the date of enactment of the 96 Act, including
the obligations imposed on incumbent local exchange carriers to interconnect
with the networks of other telecommunications carriers (including competing
telecommunications carriers), unbundling of services into network elements,
repricing of their services at wholesale rates for the purpose of permitting
resale of those services, allowing other telecommunications carriers physically
to collocate their equipment on the premises of the incumbent local exchange
carriers, and requiring telecommunications carriers to compensate one another
based on their own costs for the transport and termination of calls on one
anothers' networks.
The Company's telephone operating subsidiaries are exempt from certain of the
foregoing obligations unless, in response to a bona fide request, a state
regulatory commission removes that exemption. The Company's telephone
operating subsidiaries may, by petitioning the appropriate state regulatory
commission, also qualify for exemption from certain other of those
obligations. In addition, the 96 Act requires the FCC to institute and refer
to a Federal-State Joint Board a proceeding to recommend changes to the
current method of subsidizing universal service to assure the availability
of quality telephone services at just, reasonable and affordable rates.
There were no local rate increases granted to any of the Company's telephone
operating subsidiaries in 1995, nor are there any rate requests currently
pending before regulatory commissions. During 1995, telephone operations
were affected by certain regulatory commission orders designed to reduce
earnings levels. These orders did not materially affect the results of
operations of the Company's telephone operating subsidiaries. Certain states
in which the Company's telephone operating subsidiaries operate have adopted
alternatives to rate-of-return regulation, either through legislative changes
or by regulatory commission actions. The Company has adopted alternative
regulation in certain states and continues to evaluate alternative regulation
for its other telephone operating subsidiaries.
4
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
TELEPHONE OPERATIONS (continued)
LOCAL SERVICE (continued)
Competition
Historically, the Company's telephone operating subsidiaries have not
experienced significant competition in the service areas allocated to them by
the state regulatory commissions. As a result of the passage of the 96 Act,
the Company's local telephone operating subsidiaries should experience
increased competition from various sources, including, but not limited to,
resellers of their local exchange services, large end users installing their
own networks, interexchange carriers, satellite transmission services, cellular
communications providers, cable television companies, radio-based personal
communications companies, competitive access providers and other systems
capable of completely or partially bypassing the local telephone facilities.
The Company cannot predict the specific effects of competition on its local
telephone business, but is intent on meeting and taking advantage of the
various opportunities that competition should provide. The Company is
currently addressing potential competition by focusing on improved customer
satisfaction, reducing its costs, increasing efficiency, restructuring rates
and examining new product offerings and new markets for entry.
ACCESS SERVICES
General
The Company's telephone operating subsidiaries offer equal access to nearly
98 percent of their customers. Equal access enables customers to choose their
long-distance company. The Company's telephone operating subsidiaries
program their equipment to allow customers to access their selected
long-distance company by dialing 1, the area code, and a seven-digit telephone
number. Long-distance companies pay access charges to the Company's telephone
operating subsidiaries for the use of their local networks to originate and
terminate their long-distance calls.
Regulation
The FCC authorizes a rate-of-return ("ROR") that telephone companies may earn
on the interstate services they provide. The current ROR is 11.25 percent for
companiesremaining under ROR regulation. The FCC is currently considering
changing the 11.25 percent ROR as a result of lower market interest rates.
Effective January 1, 1991, the FCC replaced ROR regulation with price cap
regulation for the Bell Operating Companies and GTE Corporation and allowed
all other companies that did not remain in the National Exchange Carrier
Association ("NECA") Common Line and Traffic Sensitive Pools the option of
price cap regulation. The FCC undertook a comprehensive review of price cap
regulation in 1994, adopted certain interim rules for price cap companies in
1995 and initiated a further proceeding on price caps that is expected to
conclude in 1996.
5
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
TELEPHONE OPERATIONS (continued)
ACCESS SERVICES (continued)
Regulation (continued)
Price cap regulation provides for earnings potential that differs from ROR
regulation, depending on the "productivity offset" the company chooses. In
addition, companies electing price cap regulation may make adjustments for the
rate of inflation and exogenous costs (such as separations and tax law
changes). Price cap regulation is designed to allow greater pricing
flexibility and includes the risk of earnings lower than that which may have
been earned under ROR regulation. If any of the Company's local telephone
operating subsidiaries were to elect price cap regulation, then all of its
affiliated telephone operating companies would also have to elect price cap
regulation at the same time.
In 1992, the FCC initiated a rulemaking proceeding (CC Docket No. 92-135) to
address regulatory alternatives for mid-size and small local exchange
carriers. This proceeding resulted in a set of rules, adopted in September of
1993, that provide for a non-price cap form of alternative regulation. The
Company's telephone operating subsidiaries would be eligible for this form of
regulation. The Company's telephone operating subsidiaries have not elected
price cap regulation for interstate purposes and continue to evaluate the
various forms of alternative regulation.
The effect of the 96 Act on the FCC's regulations concerning ROR regulation
and alternative regulation is not yet clear, although, as a result of the
enactment of the 96 Act, it is likely that the FCC will reexamine its rules to
reflect the provisions of the 96 Act and the associated increased competitive
market conditions.
The Company's telephone operating subsidiaries currently receive compensation
from long-distance companies for intrastate, intraLATA services through access
charges or toll settlements that are subject to state regulatory commission
approval.
The 96 Act requires each local exchange carrier to continue to provide access
services in accordance with requirements effective on the date immediately
preceding the effective date of the 96 Act, until those requirements are
specifically superseded by regulations prescribed by the FCC. The FCC is
required, within six months after the date of the enactment of the 96 Act, to
establish regulations, as necessary, to implement the interconnection,
unbundled access, resale, and collocation requirements of the 96 Act. The 96
Act requires that interconnection and unbundled network elements be priced at
just and reasonable rates, based on costs, and that compensation for transport
and termination of traffic be reciprocal among carriers and be just and
reasonable.
Billing and collection
Interstate billing and collection services were previously detariffed as
ordered by the FCC. The Company's telephone operating subsidiaries continue to
provide interstate billing and collection services for interexchange carriers
through various agreements and also provide intrastate billing and collection
services under state tariff arrangements or under contract where these
services are detariffed. The demand for these services may increase as a
result of the entrance of other carriers in the local and long-distance
markets.
6
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
TELEPHONE OPERATIONS (continued)
ACCESS SERVICES (continued)
Competition
One consequence of competition is the bypass of the Company's telephone
operating subsidiaries' facilities by local networks constructed by new
providers of local exchange telephone services. While currently there has
been no significant measurable effect on the Company's telephone operating
subsidiaries due to competition, the 96 Act may facilitate various forms of
bypass of the Company's telephone operating subsidiaries' networks.
CELLULAR OPERATIONS
GENERAL
ALLTEL Mobile provides cellular telephone service in various markets
throughout the United States to a wide array of customers. As cellular
telephones have become increasingly popular across broader segments of the
population, ALLTEL Mobile has, in addition to its traditional sales offices,
opened retail outlets and located retail centers in high traffic department
stores, where customers can purchase equipment and subscribe to ALLTEL
Mobile services.
BUSINESS
One measure of a cellular telephone market's potential is the market's
population times the percent of a company's ownership interest of the
cellular operation in that market ("pops"). ALLTEL Mobile owns a majority
interest in cellular operations in 13 MSAs and a minority interest in 14 other
MSAs, which total 5.0 million MSA cellular pops. ALLTEL Mobile also owns a
majority interest in cellular operations in 40 RSAs and a minority interest in
32 other RSAs, which total 3.2 million cellular pops. ALLTEL Mobile operates
systems in Montgomery, Alabama; Ft. Smith, Arkansas; Fayetteville, Arkansas;
Little Rock, Arkansas; Ocala/Gainesville, Florida; Albany, Georgia; Aiken,
South Carolina/Augusta, Georgia; Savannah, Georgia; Springfield, Missouri;
Charlotte, North Carolina; Columbia, South Carolina and Florence, South
Carolina.
ALLTEL Mobile's subscriber fees are based upon the prevailing market and
competitive conditions which exist in each service area operated. At
December 31, 1995, ALLTEL Mobile provided service to more than 624,000
customers, which, based on its 8.2 million total pops, represented a market
penetration rate of 7.6 percent. For the year ended December 31, 1995, ALLTEL
Mobile's churn rate averaged 2.2 percent in its cellular service areas, which
is comparable to the industry average.
7
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ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
CELLULAR OPERATIONS (continued)
COMPETITION
Cellular carriers today face competition from a second carrier licensed to
provide cellular telephone services in the same geographic area, as well as
from cellular resellers who buy bulk cellular services from one of the two
licensees and resell it to their customers.
ALLTEL Mobile will face new competitors in its markets as a result of the
licensing of new wireless service providers including providers of personal
communication services ("PCS") and enhanced mobile services. The Company
expects these PCS providers to begin operations in ALLTEL Mobile's markets
during 1996.
The 96 Act provides cellular carriers numerous opportunities to emerge as full
competitors to traditional telephone companies, including the opportunity to
resell local telephone services and to be compensated by other
telecommunications carriers for calls terminated on the cellular carriers'
networks. Cellular carriers are not subject to the enhanced interconnection,
resale, unbundling and other obligations that the 96 Act imposed on the local
exchange companies unless the FCC determines cellular carriers should be
considered local exchange carriers under the 96 Act. The 96 Act limits the
imposition on cellular carriers of equal access requirements without a
detailed FCC rulemaking. The 1993 Omnibus Budget Reconciliation Act preempted
most state regulation of cellular carriers, therefore, cellular carriers'
services are likely to continue to be minimally regulated for the foreseeable
future.
PAGING
ALLTEL Mobile also operates wide-area computer-driven paging networks as a
complementary service to cellular telephones in Arkansas and Florida. At
December 31, 1995, ALLTEL Mobile provided paging service to more than
31,000 customers, which, based on the total pops in its service areas of 1.9
million, represented a market penetration rate of 1.7 percent. For the year
ended December 31, 1995, revenues per subscriber averaged $12 per
month, and ALLTEL Mobile's churn rate averaged 3.0 percent in its paging
service areas.
INFORMATION SERVICES
GENERAL
Effective February 15, 1995, the Company changed the names of its principal
information services subsidiaries. Systematics Information Services, Inc. was
changed to ALLTEL Information Services, Inc., Systematics Financial Services,
Inc. was changed to ALLTEL Financial Information Services, Inc., Computer
Power, Inc. was changed to ALLTEL Mortgage Information Services, Inc.,
Systematics Healthcare Services, Inc. was changed to ALLTEL Healthcare
Information Services, Inc. and Systematics Telecommunications Services, Inc.
was changed to ALLTEL Telecom Information Services, Inc.
ALLTEL Information Services, Inc. ("ALLTEL Information Services") provides a
wide range of information processing services to the financial services,
healthcare and telecommunications industries through information processing
centers that it staffs, equips and operates. Information processing contracts
are generally for a multi-year period. ALLTEL Information Services also
markets software worldwide to financial services, healthcare and
telecommunications companies operating their own information processing
departments.
8
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ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
INFORMATION SERVICES (continued)
GENERAL (continued)
ALLTEL Financial Information Services, Inc. ( the "Financial Division") markets
software and services that have been developed and improved continuously over
the last 27 years and are designed to fulfill substantially all of the retail
information processing and management information requirements of financial
institutions. ALLTEL Telecom Information Services, Inc. (the "Telecom
Division") is primarily engaged in the development and marketing of billing
services and customer care software to local telephone and cellular companies.
In addition, the Telecom Division provides data processing and outsourcing
services to both wireline and wireless telecommunications service providers.
ALLTEL Healthcare Information Services, Inc. (the "Healthcare Division") is
primarily engaged in the development and marketing of comprehensive patient
centered healthcare enterprise information systems to medium to large
healthcare companies throughout North America and Europe. These systems are
designed to enhance the quality of patient care, control processing costs and
provide substantially all of the patient care information requirements
of its users. Under typical arrangements with hospitals, software is licensed
under perpetual license arrangements. Software and hardware maintenance are
normally contracted for periods of five to seven years. Contracts to install
software normally range over periods from twelve to eighteen months. Other
services provided include training, consulting and data processing services.
ALLTEL Mortgage Information Services, Inc. (the "Mortgage Division") provides
data processing and related computer software and systems to financial
institutions originating and/or servicing single family mortgage loans. This
subsidiary's software products and processing services, combined with its team
of consultants, are intended to offer a cost-effective alternative to the
extensive technical support staff and the enlarged group of mortgage
bankers which would otherwise have to be assembled in-house by each customer.
The Mortgage Division's on-line systems automate processing functions required
in the origination of mortgage loans, the management of such loans while in
inventory before they are sold in the secondary market, and their subsequent
servicing.
CUSTOMERS
The Financial Division's primary market for its financial products and
services are the nation's commercial banks and savings institutions and
financial institutions outside the United States, primarily in Europe and Asia.
Financial software and services are also marketed to mortgage service
companies, credit unions and healthcare companies. The Telecom Division's
primary market for its telecommunications products and services is the top 150
telephone companies and top 50 cellular companies in the United States. The
Healthcare Division's primary market for its healthcare software products are
hospitals with 400 or more beds, many of which are large, state funded
hospitals (including a significant number of university hospitals) and other
large healthcare providers. The Mortgage Division provides its services
primarily to financial institutions originating or servicing single family
mortgage loans that have sold the loans in the secondary market while
continuing to service the loans. These institutions, which include many of
the largest servicers of residential mortgages, are located throughout the
United States. In total, nearly 16 million mortgage loans representing over
$1.3 trillion are processed using the Mortgage Division's software.
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ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
INFORMATION SERVICES (continued)
COMPETITION
The Financial Division's competition primarily comes from "in-house" bank
information processing departments and other companies engaged in active
competition for financial institution outsourcing contracts. Numerous large
financial institutions provide information processing for smaller institutions
in their respective geographic areas, along with other companies that perform
such services for small institutions. There are also other companies that
provide information processing services to the telecommunications industry.
Competition in the healthcare industry primarily comes from other companies
that provide comprehensive integrated hospital information systems and from
companies which offer solutions for individual departments within the
respective healthcare enterprises. The Mortgage Division's competition comes
from "in-house" information processing departments and from other companies
that offer information processing services to the mortgage banking industry.
The information services subsidiaries compete in each of their markets by
providing a high level of service and support. The information services
subsidiaries substantially rely upon and vigorously enforce contract and trade
secret laws and internal non-disclosure safeguards to protect the proprietary
nature of their computer software.
REGULATION AND EXAMINATION
Both the Financial Division and the Mortgage Division are regulated by the
federal agencies that have supervisory authority over banking, thrift, and
credit union operations. The Financial Division is also classified as one of
twelve national vendors that, as a result of their market share, process a
significant portion of the financial industry's assets. These industry
leaders are also examined by the federal Financial Institutions Examination
Council on an ongoing basis. The information services subsidiaries' management
practices, policies, procedures, standards, and overall financial condition
are components of these reviews.
In addition to these corporate examinations, the information services
subsidiaries' individual processing sites are examined, as if they were
departments of their respective clients, by federal and state regulators, as
well as the clients' internal audit departments and their independent auditing
firms. The same standards of performance are applied to those information
processing centers as are applied to the client financial institutions.
Reports of the information services subsidiaries' data center performance are
furnished to the Board of Directors of ALLTEL Information Services and to the
Board of Directors of the examined client. The supervisory agencies include
applicable state banking departments, the Federal Deposit Insurance
Corporation, the Office of Thrift Supervision, the Office of the Comptroller of
the Currency, the Board of Governors of the Federal Reserve System, and the
National Credit Union Administration. The information services subsidiaries'
processing contracts include a commitment to install all necessary changes in
its computer software that are required by changes in regulations.
The Healthcare Division's operations are not specifically regulated by any
federal or state healthcare agency. However, its software must meet all
federal and state reporting requirements of its customers, including Medicare,
Medicaid and other state-sponsored programs.
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ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
INFORMATION SERVICES (continued)
REGULATION AND EXAMINATION (continued)
The Mortgage Division operates transmitters at the network's information
processing facility hub and operates very small aperture technology ("VSAT")
earth stations at numerous customer locations. Prior to initiation,
construction or operation of the transmitters used in a VSAT satellite network,
operators of these transmitters are required by the Communications Act of 1934
to be authorized by the FCC. The FCC grants licenses to VSAT operators
for a predetermined number of earth stations that may be placed at unspecified
locations in the United States. The Mortgage Division holds five VSAT
licenses issued by the FCC to operate its domestic earth station satellite
network, consisting of one 8.1m license for its VSAT hub located in
Jacksonville, Florida and four other VSAT licenses ranging from 1.0m to 2.4m.
Three of the VSAT licenses, including the 8.1m license, will expire in 1997,
and the remaining two licenses will expire in 2003.
PRODUCT DEVELOPMENT AND SUPPORT
In the past five years, the information services subsidiaries have spent
approximately $215.5 million ($62.6 million in 1995) on mainframe and client
server software design and development. The information services subsidiaries
have also begun to develop products which will be utilized in a UNIX based
environment. Changes in regulatory requirements of both state and federal
authorities, increasing competition, and the development of new products and
markets create the need to continually update or modify existing software and
systems offered to customers. The information services subsidiaries intend
to continue to maintain, improve, and expand the functions and capabilities
of their software products over the next several years.
OTHER
In 1995, ALLTEL Information Services signed a long-term agreement to provide
development and management of GO Communications Corporation's information
systems. Under terms of the ten year contract, if Go Communications is
successful in the FCC's "C" band PCS auction, the Telecom Division will
develop, integrate and manage GO Communication Corporation's information
systems through utilization of its proprietary Virtuoso software and the
development of an enterprise-wide operational support system.
In 1994, ALLTEL Information Services signed a long-term agreement to provide
information processing services for the telephone operations of Citizens.
Under terms of the ten year contract, the Telecom Division will provide
complete outsourcing services for Citizens' telephone customers, including
generating Citizens' billing, customer service information, engineering, and
operational support. This contract also includes providing all information
processing services for ALLTEL's telephone operations.
In 1993, ALLTEL Information Services signed a long-term agreement with GTE
Telecommunications Products and Services Group to outsource GTE's cellular
billing operations. Also in 1993, the Healthcare Division signed its
first hospital outsourcing contract with St. Joseph's Hospital in Parkersburg,
West Virginia. Under terms of the five-year contract, the Healthcare
Division assumed all healthcare information systems operations for this 375 bed
hospital, including providing on-site and remote management, software
implementation and support, hardware and network management and maintenance.
11
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
PRODUCT DISTRIBUTION OPERATIONS
GENERAL
ALLTEL Supply, Inc. ("ALLTEL Supply"), with sixteen warehouses and fifteen
counter-sales showrooms across the United States, is a major distributor of
telecommunications equipment and materials. It supplies equipment to
affiliated and non-affiliated telephone companies, business systems suppliers,
railroads, governments, and retail and industrial companies. HWC Distribution
Corp. ("HWC"), with nine warehouses throughout the United States, is a
major supplier of specialty wire and cable products.
COMPETITION
ALLTEL Supply and HWC (the "Distribution companies") experience substantial
competition throughout their sales territories from other distribution
companies and direct sales by manufacturers. Competition is based primarily
on quality, product availability, service, price, and technical assistance.
Since the products distributed by the Distribution companies are also offered
by other competitors, the Distribution companies differentiate themselves
from competitors by providing value-added services such as offering expert
technical assistance, maintaining extensive inventories in strategically
located warehouses and counter-sales show rooms to facilitate single
supplier sourcing and "just-in-time" delivery, maintaining a full range of
alternative product lines, and by providing staging, assembly and other
services. The Company is continually evaluating and implementing policies
and strategies which will meet customer expectations and position the
Distribution companies in the market as a quality customer-focused
distributor. Examples of these policies and strategies include the customer
cable management program offered by HWC and the "just-in-time" inventory
program by ALLTEL Supply.
PRODUCTS
ALLTEL Supply offers more than 42,000 products for sale. In addition, ALLTEL
Supply inventories single and multi-line telephone sets, local area
networks ("LANs"), switching equipment modules, interior cable, pole line
hardware, and various other telecommunications supply items.
HWC inventories approximately 43,000 reels of specialty wire and cable. These
include shielded and unshielded power cables, flame resistant cables, and high
temperature precision engineered cables.
The Distribution companies have not encountered any material shortages or
delays in delivery of products from their suppliers.
DIRECTORY PUBLISHING
ALLTEL Publishing coordinates advertising, sales, printing, and distribution
for 356 telephone directories in 38 states. In October 1993, ALLTEL
Publishing completed its purchase of GTE Directories independent publishing
business, which included contracts with more than 125 independent telephone
companies across the country. Under terms of the agreement, ALLTEL Publishing
provides all directory publishing services including contract management,
production and marketing. As subcontractor, GTE Directories provides directory
sales and printing services through a separate contract with ALLTEL Publishing.
12
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 1. Business
CABLE TELEVISION SERVICE
As previously discussed, the Company disposed of substantially all of its
cable television operations during 1995. As part of its agreement to sell
certain telephone properties, the Company also completed the sale of certain
cable television properties to Citizens. These cable television properties
served approximately 6,800 customers in Arizona, California, New Mexico and
Utah. The Company also completed in 1995 the sale of its cable television
properties in Texas which served approximately 7,200 customers. As a result of
these sales, the Company's cable television operations are limited to only
providing service to approximately 3,400 customers located in the cities of
Bolivar and Stockton, Missouri. These remaining cable television properties
are not significant to the ongoing operations of the Company.
The Company does not hold any spectrum or other licenses issued by the FCC
related to its cable television operations. The Company's cable system
receives signals by means of special antennae, microwave relay systems and
earth stations. The system amplifies such signals and distributes programs to
subscribers through a coaxial cable system. The number of broadcast channels
provided by the Company in each of its two service areas are 26 channels.
The sources of the Company's cable television programming consist of the
signals received from national television networks, local and other independent
television stations that operate in or near to the Company's service areas,
satellite-delivered non-broadcast channels, and public service announcements.
Through contractual arrangements, the Company has obtained the authority to
re-transmit the program offerings supplied by these providers.
INVESTMENTS
WORLDCOM, INC.
The Company owns approximately a 7 percent interest in WorldCom, Inc.
(formerly LDDS Communications, Inc.), a publicly-held company. WorldCom, Inc.
is a large long-distance company in the United States and is a full service
provider of international telecommunications and specialized broadcasting
services.
GO COMMUNICATIONS CORPORATION
During 1995, the Company made an approximate $32 million investment in GO
Communications Corporation, a bidder in the FCC's "C" band PCS auction that is
scheduled to be concluded in early 1996. As a result, the Company owns
approximately a 20 percent interest in GO Communications Corporation.
HORIZON TELECOM, INC.
ALLTEL owns a 19.8 percent interest in Horizon Telecom, Inc. (formerly
Chillicothe Telephone Company), which serves approximately 27,000 telephone
lines in Ohio. Frederick G. Griech, President of ALLTEL Telephone Services
Corporation's Northeast Region, and Dennis Mervis, President of ALLTEL Ohio,
Inc. and The Western Reserve Telephone Company, are members of Horizon
Telecom, Inc.'s Board of Directors.
COMDIAL CORPORATION
During 1995, the Company sold approximately one-half of its shares of stock in
Comdial Corporation, a producer of quality telephone sets and key systems. As
a result, the Company now owns approximately a 3 percent interest in Comdial
Corporation.
13
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part I
Item 2. Properties
TELEPHONE PROPERTY
The Company's telephone property in service consists primarily of land and
buildings, central office equipment, telephone lines, and related equipment.
The gross investment by category in telephone property as of December 31, 1995
was as follows:
(Thousands)
Telephone-
Land, buildings and leasehold improvements $ 276,785
Central office equipment 1,269,038
Outside plant 1,904,764
Furniture, fixtures, vehicles and other 282,881
Total $3,733,468
Standard practices prevailing in the telephone industry are followed by the
Company's telephone operating subsidiaries in the construction and maintenance
of plant and facilities. Certain properties of the Company and its telephone
operating subsidiaries are pledged as collateral for long-term debt.
OTHER PROPERTY
Other properties of the Company in service consist primarily of property, plant
and equipment used in information services, product distribution and cellular
telephone operations. The total investment by category for these operations
as of December 31, 1995 was as follows:
(Thousands)
Land, buildings and leasehold improvements $ 205,891
Data processing equipment 340,741
Cellular telephone plant and equipment 331,755
Furniture, fixtures and miscellaneous 81,623
Total $ 960,010
All of the Company's property is considered to be in reasonably sound
operating condition.
Item 3. Legal Proceedings
The Company is not currently involved in any material pending legal
proceedings, other than routine litigation incidental to its
business, and, to the knowledge of the Company's management, no
material legal proceedings, either private or governmental, are
contemplated or threatened.
Item 4. Submission of Matters to a Vote of Security Holders
No matters were submitted to the security holders for a vote during
the fourth quarter of the fiscal year.
14
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters
As of January 31, 1996, the approximate number of stockholders of
common stock including an estimate for those holding shares in
brokers' accounts was 92,000. For additional information pertaining
to Markets for ALLTEL Corporation's Common Stock and Related
Stockholder Matters, refer to pages 37, 39, 43 and the inside back
cover of ALLTEL's 1995 Annual Report to Stockholders, which is
incorporated herein by reference.
Item 6. Selected Financial Data
For information pertaining to Selected Financial Data of ALLTEL
Corporation, refer to page 34 of ALLTEL's 1995 Annual Report to
Stockholders, which is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
For information pertaining to Management's Discussion and Analysis
of Financial Condition and Results of Operations of ALLTEL
Corporation, refer to pages 27-32 of ALLTEL's 1995 Annual Report to
Stockholders, which is incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data
For information pertaining to Financial Statements and Supplementary
Data of ALLTEL Corporation, refer to pages 33 and 35-47 of ALLTEL's
1995 Annual Report to Stockholders, which is incorporated herein by
reference.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure
During the two most recent fiscal years or the subsequent interim
period up to the date of this Form 10-K, there were no disagreements
with the Company's independent certified public accountants on any
matter of accounting principles or practices, financial statement
disclosures or auditing scope or procedures. In addition, none of
the "kinds of events" described in item 304(a)(1)(v)(A),(B),(C)
and (D) of Regulation S-K have occurred.
15
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part III
Item 10(a). Directors of the Registrant
For information pertaining to Directors of ALLTEL Corporation
refer to "Election of Directors" in ALLTEL's Proxy Statement for
its 1996 Annual Meeting of Stockholders, which is incorporated
herein by reference.
Item 10(b). Executive Officers of the Registrant
Name Age Position
Joe T. Ford 58 Chairman, President and Chief
Executive Officer
* Scott T. Ford 33 Executive Vice President
Tom T. Orsini 45 Executive Vice President
Dennis J. Ferra 42 Senior Vice President and
Chief Financial Officer
Francis X. Frantz 42 Senior Vice President -
External Affairs, General
Counsel and Secretary
John L. Comparin 43 Vice President - Human
Resources and Administration
Ronald D. Payne 49 Vice President - Strategic
Planning and Business
Development
Jerry M. Green 48 Treasurer
John M. Mueller 45 Controller
Deborah J. Akins 40 Assistant Treasurer
* - On January 25, 1996, Scott T. Ford was elected as a Director of the
Company. On January 31, 1996, Scott T. Ford was named Executive Vice
President of the Company.
There are no arrangements between any officer and any other person pursuant to
which he/she was selected as an officer. Except for Scott T. Ford, each of
the officers named above has been employed by ALLTEL or a subsidiary for the
last five years. Prior to joining ALLTEL, Scott T. Ford served as Assistant to
the Chairman of Stephens Group, Inc. of Little Rock, Arkansas.
Item 11. Executive Compensation
For information pertaining to Executive Compensation, refer to
"Management Compensation" in ALLTEL's Proxy Statement for its 1996
Annual Meeting of Stockholders, which is incorporated herein by
reference.
16
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part III
Item 12. Security Ownership of Certain Beneficial Owners and Management
For information pertaining to beneficial ownership of ALLTEL
securities, refer to "Security Ownership of Certain Beneficial Owners
and Management" in ALLTEL's Proxy Statement for its 1996 Annual
Meeting of Stockholders, which is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
For information pertaining to Certain Relationships and Related
Transactions, refer to "Certain Transactions" in ALLTEL's Proxy
Statement for its 1996 Annual Meeting of Stockholders, which is
incorporated herein by reference.
Form 10-K, Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(a) The following documents are filed as a part of this report:
1. Financial Statements:
The following Consolidated Financial Statements of ALLTEL
Corporation and subsidiaries, included in the annual report of
ALLTEL Corporation to its stockholders for the year ended
December 31, 1995, are incorporated herein by reference:
Annual Report
Page Number
Report of Independent Public Accountants 33
Consolidated Statements of Income -
for the years ended December 31, 1995, 1994 and 1993 35
Consolidated Balance Sheets - December 31, 1995 and 1994 36-37
Consolidated Statements of Cash Flows -
for the years ended December 31, 1995, 1994 and 1993 38
Consolidated Statements of Shareholders' Equity -
for the years ended December 31, 1995, 1994 and 1993 39
Notes to Consolidated Financial Statements 41-47
Supplementary Information-Business Segment Information 40 and 46
The Consolidated Financial Statements and Supplementary Financial
Information listed in the above index which are included in the 1995
Annual Report to Stockholders of ALLTEL Corporation are hereby
incorporated by reference.
17
<PAGE>
ALLTEL Corporation
Securities and Exchange Commission
Form 10-K, Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K
(continued):
2. Financial Statement Schedules:
Form 10-K
Page Number
Report of Independent Public Accountants 20
Schedule II. Valuation and Qualifying Accounts 21
3. Exhibits:
See "Exhibit Index" located on page 22-26 of this document.
(b) No reports on Form 8-K were filed during the last quarter of 1995.
Separate condensed financial statements of ALLTEL Corporation have
been omitted since the Company meets the tests set forth in
Regulation S-X Rule 4-08(e)(3). All other schedules are omitted
since the required information is not present or is not present in
amounts sufficient to require submission of the schedule, or because
the information required is included in the consolidated financial
statements and notes thereto.
18
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
ALLTEL Corporation
Registrant
By /s/ Joe T. Ford
Joe T. Ford, Chairman, President and Date: February 20, 1996
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
By /s/ Dennis J. Ferra Date: February 20, 1996
Dennis J. Ferra, Senior Vice President and
Chief Financial Officer
* Joe T. Ford, Chairman, President,
Chief Executive Officer, and Director
* Scott T. Ford, Executive Vice President and Director
* Dennis J. Ferra, Senior Vice President and
Chief Financial Officer
* John M. Mueller, Controller
By /s/Dennis J. Ferra
* Ben W. Agee, Director *(Dennis J. Ferra,
Attorney-in-fact)
* Michael D. Andreas, Director
Date: February 20, 1996
* John R. Belk, Director
* Lawrence L. Gellerstedt III, Director
* W. W. Johnson, Director
* Emon A. Mahony, Jr., Director
* John P. McConnell, Director
* Josie C. Natori, Director
* John E. Steuri, Director
* Carl H. Tiedemann, Director
* Ronald Townsend, Director
* William H. Zimmer, Jr., Director
19
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders of
ALLTEL Corporation:
We have audited in accordance with generally accepted auditing standards, the
financial statements included in ALLTEL Corporation's Annual Report to
stockholders incorporated by reference in this Form 10-K, and have issued
our report thereon dated January 22, 1996. Our audit was made for the purpose
of forming an opinion on those statements taken as a whole. The schedule on
page 21 is the responsibility of the company's management and is presented for
purposes of complying with the Securities and Exchange Commission's rules and
is not part of the basic financial statements. This schedule has been
subjected to the auditing procedures applied in the audit of the basic
financial statements and, in our opinion, fairly states in all material
respects the financial data required to be set forth therein in relation to the
basic financial statements taken as a whole.
/s/ ARTHUR ANDERSEN LLP
Little Rock, Arkansas,
January 22, 1996.
20
<PAGE>
ALLTEL CORPORATION
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
(Dollars in Thousands)
<TABLE>
<CAPTION>
Column A Column B Column C Column D Column E
Additions
Per Adjusted Charged to Charged Balance at
Previous Adjustments Beginning Cost and to Other Deduction End of
Description Report (B) Balance Expenses Accounts Describe Period
Allowance for doubtful accounts,
subscribers and others:
For the years ended
<S> <C> <C> <C> <C> <C> <C> <C>
December 31, 1995 $21,510 $ - $21,510 $35,860 $ - $38,931 (A) $18,439
December 31, 1994 $10,766 $ 39 $10,805 $33,504 $ - $22,799 (A) $21,510
December 31, 1993 $ 8,849 $ 656 $ 9,505 $13,636 $ - $12,375 (A) $10,766
<FN>
Notes:
(A) Accounts charged off less recoveries of amounts previously charged off.
(B) Reclassification of amount for companies purchased in 1994 and 1993.
</FN>
</TABLE>
21
<PAGE>
EXHIBIT INDEX
Number and Name Page
(3)(a) Amended and Restated Certificate of Incorporation of *
ALLTEL Corporation (incorporated herein by reference to
Exhibit B to Proxy Statement, dated March 9, l990).
(b) By-Laws of ALLTEL Corporation (Exhibit 3(b) to Form SE dated *
February 17, 1993).
(4)(a) Amended and Restated Rights Agreement dated as of April 26, *
l989, between ALLTEL Corporation and Ameritrust Company N.A.
(incorporated herein by reference to Form 8 dated April 26,
l989, filed with the Commission on April 28, l989).
(b) First Amendment to Amended and Restated Rights Agreement dated *
as of April l6, l990, between ALLTEL Corporation and Ameritrust
Company N.A. (incorporated herein by reference to Form SE of
ALLTEL Corporation filed with the Commission on April 23, l990).
(c) The Company agrees to provide to the Commission, upon request, --
copies of any agreement defining rights of long-term debt
holders.
(10)(a)(1) Executive Compensation Agreement and amendments thereto by and *
between the Corporation and Joe T. Ford (incorporated herein by
reference to Exhibit 10(b) to Form 10-K for the fiscal year
ended December 31, 1983).
(a)(2) Modification to Executive Compensation Agreement by and between *
the Corporation and Joe T. Ford effective as of January 1, 1987
(incorporated herein by reference to Exhibit 10(b)(2) to Form
10-K for the fiscal year ended December 31, 1986).
(a)(3) Modification to Executive Compensation Agreement by and between *
ALLTEL Corporation and Joe T. Ford, effective as of January 1,
1991 (incorporated herein by reference to Exhibit 10 of ALLTEL
Corporation Registration Statement (No. 33-44736) on Form S-4
dated December 23, 1991).
(a)(4) Split-dollar Life Insurance Agreement by and between the *
Corporation and Joe T. Ford effective as of March 1, 1994
(incorporated herein by reference to Exhibit 10(a)(4) to Form
10-K for the fiscal year ended December 31, 1994).
(b)(1) Executive Compensation Agreement by and between the Company and *
John E. Steuri effective as of April l7, l990 (incorporated
herein by reference to Exhibit B of ALLTEL Corporation
Registration Statement (No. 33-34495) on Form S-4 dated
April 23, 1990).
(b)(2) Executive Retirement Agreement by and between the Company and 67
John E. Steuri effective as of December 27, l995.
* Incorporated herein by reference as indicated.
22
<PAGE>
EXHIBIT INDEX, Continued
Number and Name Page
(10)(c)(1) Change in Control Agreement by and between the Company and *
John L. Comparin effective as of October 24, 1994 (incorporated
herein by reference to Exhibit 10(c)(2) to Form 10-K for the
fiscal year ended December 31, 1994).
(c)(2) Change in Control Agreement by and between the Company and *
Dennis J. Ferra effective as of October 24, 1994 (incorporated
herein by reference to Exhibit 10(c)(3) to Form 10-K for the
fiscal year ended December 31, 1994).
(c)(3) Change in Control Agreement by and between the Company and *
Francis X. Frantz effective as of October 24, 1994
(incorporated herein by reference to Exhibit 10(c)(4) to Form
10-K for the fiscal year ended December 31, 1994).
(c)(4) Change in Control Agreement by and between the Company and *
Tom T. Orsini effective as of October 24, 1994 (incorporated
herein by reference to Exhibit 10(c)(5) to Form 10-K for the
fiscal year ended December 31, 1994).
(c)(5) Change in Control Agreement by and between the Company and *
Ronald D. Payne effective as of October 24, 1994 (incorporated
herein by reference to Exhibit 10(c)(6) to Form 10-K for the
fiscal year ended December 31, 1994).
(d)(1) Split-dollar Life Insurance Agreement by and between the *
Corporation and Dennis J. Ferra effective as of March 1, 1994
(incorporated herein by reference to Exhibit 10(d)(1) to Form
10-K for the fiscal year ended December 31, 1994).
(d)(2) Split-dollar Life Insurance Agreement by and between the *
Corporation and Francis X. Frantz effective as of March 1, 1994
(incorporated herein by reference to Exhibit 10(d)(2) to Form
10-K for the fiscal year ended December 31, 1994).
(d)(3) Split-dollar Life Insurance Agreement by and between the *
Corporation and Tom T. Orsini effective as of March 1, 1994
(incorporated herein by reference to Exhibit 10(d)(3) to
Form 10-K for the fiscal year ended December 31, 1994).
(e)(1) ALLTEL Corporation Supplemental Executive Retirement Plan, *
effective October 24, 1994 (incorporated herein by reference
to Exhibit 10(e)(1) to Form 10-K for the fiscal year ended
December 31, 1994).
(e)(2) Directors' Retirement Plan of ALLTEL Corporation, as amended *
and restated effective January 1, 1994 (incorporated herein
by reference to Exhibit 10(d) to Form 10-K for the fiscal year
ended December 31, 1993).
* Incorporated herein by reference as indicated.
23
<PAGE>
EXHIBIT INDEX, Continued
Number and Name Page
(10)(f)(1) Executive Deferred Compensation Plan of ALLTEL Corporation, as *
amended and restated effective October 1, 1993 (incorporated
herein by reference to Exhibit 10(e) to Form 10-K for the fiscal
year ended December 31, 1993).
(f)(2) Deferred Compensation Plan for Directors of ALLTEL Corporation, *
as amended and restated effective October 1, 1993 (incorporated
herein by reference to Exhibit 10(f) to Form 10-K for the fiscal
year ended December 31, 1993).
(g)(l) ALLTEL Corporation 1975 Incentive Stock Option Plan (as amended *
and restated effective July 26, 1988) (incorporated herein by
reference to Exhibit 10(i) to Form 10-K for the fiscal year
ended December 31, 1988).
(g)(2) ALLTEL Corporation 1991 Stock Option Plan (incorporated herein *
by reference to Exhibit A to Proxy Statement, dated March 8,
1991).
(g)(3) ALLTEL Corporation l994 Stock Option Plan for Nonemployee *
Directors (incorporated herein by reference to Exhibit B to
Proxy Statement dated March 4, l994).
(g)(4) ALLTEL Corporation l994 Stock Option Plan for Employees *
(incorporated herein by reference to Exhibit A to Proxy
Statement dated March 4, l994).
(h)(1) Systematics, Inc. 1981 Incentive Stock Option Plan and Amendment *
No. 1 thereto (incorporated herein by reference to Form S-8
(No. 33-35343) of ALLTEL Corporation filed with the Commission
on June 11, 1990).
(h)(2) Stock Purchase Plan for Employees of Systematics Information *
Services, Inc. and its Affiliates, effective June 18, 1991
(incorporated herein by reference to Exhibit 10(h)(2) to
Amendment No. 1 to Form 10-K for the fiscal year ended
December 31, 1993).
(i) ALLTEL Corporation Performance Incentive Compensation Plan as *
amended, effective January 1, 1993 (Exhibit 10(i) to Form SE
dated February 17, 1993).
(j) ALLTEL Corporation Long-Term Performance Incentive Compensation *
Plan, as amended and restated effective January 1, 1993 (Exhibit
10(j) to Form SE dated February 17, 1993).
(j)(1) Amendment No. 1 to ALLTEL Corporation Long-Term Performance *
Incentive Compensation Plan as amended and restated effective
January 1, 1993, (incorporated herein by reference to Exhibit
10(j)(1) to Amendment No. 1 to Form 10-K for the fiscal year
ended December 31, 1993).
(k) ALLTEL Corporation Pension Plan (January 1, 1994 Restatement) *
(incorporated herein by reference to Exhibit 10(k) to Form 10-K
for the fiscal year ended December 31, 1994).
* Incorporated herein by reference as indicated.
24
<PAGE>
EXHIBIT INDEX, Continued
Number and Name Page
(10)(k)(1) Amendment No. 1 to ALLTEL Corporation Pension Plan (January 1, *
1994 Restatement) (incorporated herein by reference to Exhibit
10(k)(1) to Form 10-Q for the period ended March 31, 1995).
(k)(2) Amendments No. 2 and 3 to ALLTEL Corporation Pension Plan *
(January 1, 1994 Restatement) (incorporated herein by reference
to Exhibit 10(k)(2) to Form 10-Q for the period ended June 30,
1995).
(k)(3) Amendments No. 4 and 5 to ALLTEL Corporation Pension Plan 81
(January 1, 1994 Restatement).
(l) ALLTEL Corporation Profit-Sharing Plan (January 1, 1994 *
Restatement)(incorporated herein by reference to Exhibit 10(l)
to Form 10-K for the fiscal year ended December 31, 1994).
(l)(1) Amendments No. 1 and 2 to ALLTEL Corporation Profit-Sharing *
Plan (January 1, 1994 Restatement) (incorporated herein by
reference to Exhibit 10(l)(1) to Form 10-Q for the period
ended June 30, 1995).
(l)(2) Amendments No. 3 and 4 to ALLTEL Corporation Profit-Sharing 123
Plan (January 1, 1994 Restatement).
(m) ALLTEL Corporation Benefit Restoration Plan (January 1, 1996 132
Restatement).
(n) Amended and Restated ALLTEL Corporation Supplemental Medical *
Expense Reimbursement Plan (incorporated herein by reference
to Exhibit 10(p) to Form 10-K for the fiscal year ended
December 31, 1990).
(o) ALLTEL Corporation Thrift Plan (January 1, 1994 Restatement) *
(incorporated herein by reference to Exhibit 10(p) to Form 10-K
for the fiscal year ended December 31, 1994).
(o)(1) Amendments No. 1 and 2 to ALLTEL Corporation Thrift Plan *
(January 1, 1994 Restatement) (incorporated herein by reference
to Exhibit 10(p)(1) to Form 10-Q for the period ended
June 30, 1995).
(o)(2) Amendment No. 3 to ALLTEL Corporation Thrift Plan (January 1, 146
1994 Restatement).
(11) Statement re computation of per share earnings. 27
(13) Annual report to stockholders for the year ended December 31, 32
1995. Such report, except for the portions incorporated by
reference herein, is furnished for the information of the SEC
and is not "filed" as part of this report.
* Incorporated herein by reference as indicated.
25
<PAGE>
EXHIBIT INDEX, Continued
Number and Name Page
(21) Subsidiaries of the registrant. 28
(23) Consents of experts and counsel. 31
(24) Powers of Attorney. 154
(27) Financial Data Schedule for the year ended December 31, 1995. 158
(99)(a) Annual report on Form 11-K for the Stock Purchase Plan for --
Employees of Systematics Information Services, Inc. and its
Affiliates for the year ended December 31, 1995, will be
filed by amendment.
(99)(b) Annual report on Form 11-K for the ALLTEL Corporation Thrift --
Plan for the year ended December 31, 1995, will be filed by
amendment.
* Incorporated herein by reference as indicated.
26
<TABLE>
<CAPTION>
EXHIBIT 11
ALLTEL CORPORATION
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
(Dollars and Shares in Thousands, except per share amounts)
For the Years Ended December 31, 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C>
Net income applicable to
common shares $353,458 $270,521 $260,439 $226,894 $196,883
Adjustments for convertible securities:
preferred stocks 236 258 293 355 566
Net income applicable to common
shares, assuming conversion
of above securities $353,694 $270,779 $260,732 $227,249 $197,449
Average common shares outstanding
for the year including equivalents 190,072 189,454 187,665 185,672 180,007
Increase in shares which would
result from conversion of
convertible preferred stocks 603 670 755 905 2,921
Average common shares, assuming
conversion of the above securities 190,675 190,124 188,420 186,577 182,928
Earnings per share of
common stock:
Primary $1.86 $1.43 $1.39 $1.22 $1.09
Fully-diluted $1.85 $1.42 $1.38 $1.22 $1.08
<FN>
Note: Amounts have been restated for mergers accounted for as a pooling-of-interests.
</FN>
</TABLE>
27
EXHIBIT 21
ALLTEL Corporation
Subsidiaries of the Registrant
State of
Incorporation
NORTHEAST REGION:
ALLTEL New York, Inc. New York
ALLTEL Ohio, Inc. Ohio
ALLTEL Pennsylvania, Inc. Pennsylvania
The Western Reserve Telephone Company Ohio
Tuolumne Telephone Company California
SOUTHERN REGION:
ALLTEL Alabama, Inc. Alabama
ALLTEL Carolina, Inc. North Carolina
ALLTEL Florida, Inc. Florida
ALLTEL Georgia, Inc. Georgia
ALLTEL Georgia Communications Corp. Georgia
ALLTEL Kentucky, Inc. Kentucky
ALLTEL Mississippi, Inc. Mississippi
ALLTEL South Carolina, Inc. South Carolina
ALLTEL Tennessee, Inc. Tennessee
Georgia ALLTEL Communicon Co. Illinois
Georgia ALLTELCOM Co. Indiana
Georgia ALLTEL Telecom Inc. Georgia
SOUTHWEST REGION:
ALLTEL Arkansas, Inc. Arkansas
ALLTEL Missouri, Inc. Missouri
ALLTEL Nevada, Inc. Nevada
ALLTEL Oklahoma, Inc. Arkansas
CP National Corporation California
Oklahoma ALLTEL, Inc. Oklahoma
SLT Communications, Inc. Texas
Sugar Land Telephone Company Texas
Texas ALLTEL, Inc. Texas
28
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EXHIBIT 21
ALLTEL Corporation
Subsidiaries of the Registrant, continued
State of
Incorporation
OTHER COMPANIES:
ALLTEL Business Services, Inc. Delaware
ALLTEL Communications Group, Inc. Delaware
ALLTEL Corporate Services, Inc. Delaware
ALLTEL Distribution, Inc. Delaware
ALLTEL Holding, Inc. Delaware
ALLTEL International Holdings, Inc. Delaware
ALLTEL Long Distance, Inc. Delaware
ALLTEL Mobile Communications, Inc. Delaware
ALLTEL Mobile Communications of Alabama, Inc. Alabama
ALLTEL Mobile Communications of Arkansas, Inc. Arkansas
ALLTEL Mobile Communications of the Carolinas, Inc. North Carolina
ALLTEL Mobile Communications of Florida, Inc. Florida
ALLTEL Mobile Communications of Georgia, Inc. Georgia
ALLTEL Mobile Communications of Missouri, Inc. Missouri
ALLTEL Mobile Communications of Nevada, Inc. Nevada
ALLTEL Mobile Communications of Northwest Arkansas, Inc. Arkansas
ALLTEL Mobile Communications of South Carolina, Inc. South Carolina
ALLTEL Mobile Communications of South Georgia, Inc. West Virginia
ALLTEL Publishing Corporation Ohio
ALLTEL Publishing Listing Management Corporation Pennsylvania
ALLTEL Supply, Inc. Ohio
ALLTEL Telephone Services Corporation Ohio
Alma Cellular II, Inc. Georgia
Brantley Cellular Company Georgia
Cellular Investments, Inc. Georgia
Cellular Phone of Aiken-Augusta, Inc. South Carolina
ITC Cellular Holdings, Inc. Delaware
Missouri Telephone Cellular Systems, Inc. Missouri
Pembroke Cellular Company II, Inc. Georgia
Planters Cellular Co. Georgia
Southwest Missouri Cellular Delaware
Statesboro Cellular Company, Inc. Georgia
Control Communications Industries, Inc. Delaware
Dynalex, Inc. California
HWC Distribution Corp. Delaware
Houston Wire & Cable Company Texas
Ocean Technology, Inc. California
OTI International, Inc. California
SLT Communications Supply Company Texas
SLT Communications Construction & Sales Co. Texas
Sygnis, Inc. Arkansas
Worldwide Electrical Sales Texas
29
<PAGE>
EXHIBIT 21
ALLTEL Corporation
Subsidiaries of the Registrant, continued
Country or
State of
Incorporation
OTHER COMPANIES (continued):
ALLTEL Financial Information Services, Inc. Arkansas
ALLTEL Healthcare Information Services, Inc. Delaware
ALLTEL Healthcare Information Services, Inc. - Europe Delaware
ALLTEL Healthcare Information Services, Limited United Kingdom
ALLTEL Information Services, Inc. Delaware
ALLTEL Information Services International, Ltd. Delaware
ALLTEL Information Services International Holdings, Inc. Delaware
ALLTEL Information Services, Limited United Kingdom
ALLTEL Information Services (Hong Kong) Limited Hong Kong
ALLTEL Information Services (Thailand) Limited Thailand
ALLTEL International Resource Management, Inc. Delaware
ALLTEL Mortgage Information Services, Inc. Delaware
ALLTEL Telecom Information Services, Inc. Delaware
Computer Power, Inc. Florida
CPI Datanet, Inc. Delaware
Medical Data Technology, Inc. New Jersey
Systematics International Limited Jamaica
Systematics of California, Inc. California
Vertex Banking Systems, Limited United Kingdom
Vertex Business Systems, Inc. New York
30
EXHIBIT 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders of
ALLTEL Corporation:
As independent public accountants, we hereby consent to the incorporation of
our report incorporated by reference in this Form 10-K, into the Company's
previously filed Registration Statements, File Nos. 2-99523, 33-25382,
33-34495, 33-35343, 33-41234, 33-48476, 33-51047, 33-54175, 33-56291
and 33-65199.
/s/ ARTHUR ANDERSEN LLP
Little Rock, Arkansas,
February 19, 1996.
31
EXHIBIT 13
PORTIONS OF ANNUAL REPORT TO STOCKHOLDERS
FOR THE YEAR ENDED DECEMBER 31, 1995
(incorporated by reference into this filing)
Form 10-K
Page Number
Management's Discussion and Analysis of Financial 33-44
Condition and Results of Operations
Report of Independent Public Accountants 45
Selected Financial Data 46
Consolidated Statements of Income 47
Consolidated Balance Sheets 48-49
Consolidated Statements of Cash Flows 50
Consolidated Statements of Shareholders' Equity 51
Business Segments 52
Notes to Consolidated Financial Statements 53-65
Investor Information 66
32
<PAGE>
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Financial Condition, Liquidity and Capital Resources
- -------------------------------------------------------------------------------
(Dollars in millions,
except per share amounts) 1995 1994 1993
- -------------------------------------------------------------------------------
Capital expenditures $523.1 $596.1 $426.2
Cash provided from operations $689.2 $577.2 $563.5
Long-term debt issued $218.2 $404.9 $627.8
Total capital structure $3,741.1 $3,531.0 $3,203.5
Percent debt to total capital 48% 54% 51%
Interest coverage ratio 4.72x 4.58x 5.28x
Book value per share $10.18 $8.60 $8.24
- -------------------------------------------------------------------------------
The Company's total capital structure was $3.741 billion at December 31,
1995, compared to a total capital structure of $3.531 billion at December 31,
1994, and $3.204 billion at December 31, 1993. The Company has adequate
internal and external resources available to finance its ongoing operating
requirements including capital expenditures, business development and the
payment of dividends.
Cash provided from operations, which is the Company's primary source of
liquidity, was $689.2 million in 1995, $577.2 million in 1994 and $563.5
million in 1993. The increases in 1995 and 1994 primarily reflect the growth
in earnings of the Company, partially offset by an increase in working
capital requirements in each year. Investing activities for 1995 also include
cash totaling $212.9 million that was received principally from the sale of
certain telephone properties, as discussed below.
The primary uses of capital resources continue to be for capital
expenditures and for the payment of dividends. Capital expenditures in 1995
were $523.1 million compared to $596.1 million in 1994 and $426.2 million in
1993. The Company financed the majority of its capital expenditures through
the internal generation of funds in each of the past three years. During
1995, the Company's capital expenditures were directed toward telephone
operations to continue to modernize its network and invest in equipment to
provide new telecommunications services. In addition, capital expenditures
were incurred for expansion into existing cellular and information services
markets and to upgrade existing cellular network facilities. Capital
expenditures are forecast at $456.7 million for 1996, which are expected to
be primarily internally financed. Common and preferred dividend payments
amounted to $182.3 million in 1995, $166.3 million in 1994 and $148.5 million
in 1993. In October 1995, the Board of Directors approved an 8 percent
increase in the quarterly dividend to $.26 per share. This action raised the
annualized dividend to $1.04 per share and marked the 35th consecutive year
in which the Company has increased its common stock dividend.
33
<PAGE>
The Company has a $500 million revolving credit agreement. Total
borrowings outstanding against this agreement at December 31, 1995, 1994 and
1993 were $151.5 million, $132.0 million and $214.5 million, respectively.
Additional borrowings under this agreement in 1995 were for general corporate
requirements and the expansion of cellular investments. The weighted average
interest rate on borrowings outstanding under this agreement at December 31,
1995, was 6.0 percent.
During 1995, the Company and its subsidiaries issued long-term debt of
$218.2 million, compared to $404.9 million in 1994 and $627.8 million in
1993. In September 1995, the Company issued $200 million of 6.75 percent
debentures to refinance existing high-cost indebtedness, consisting of $150
million of 10.375 percent debentures and $50 million of 8.875 percent
debentures. In October, the Company was required to pay $14.0 million in
termination fees to complete the early retirement of the $200 million debt;
however, this debt refinancing is expected to produce approximately $6.5
million in annual pre-tax interest savings. The issuance by the Company of
$250 million of 7.25 percent debentures to reduce borrowings under its
revolving credit agreement, and the issuance by subsidiaries of $60 million
of 8.05 percent notes and $30 million of 8.17 percent notes to refinance
existing high-cost indebtedness represent the majority of long-term debt
issued in 1994. The issuance of $400 million of 6.5 percent debentures by the
Company and a subsidiary to finance the acquisition of certain telephone
properties of GTE Corporation in Georgia and an increase in the use of the
Company's revolving credit agreement accounted for the majority of long-term
debt issued in 1993. The remaining borrowings for the three years were used
for investments, acquisitions and other general corporate requirements. The
loans were obtained through the private placement market, public issuance and
the Rural Utilities Service financing programs for telephone companies. The
Company and its subsidiaries expect these sources to continue to be available
for future borrowings. There were no changes in the Company's bond ratings
during 1995. Moody's Investors Service and Standard & Poor's Corporation
senior debt ratings for the Company are A2 and A+, respectively. (See Note 4
to the Consolidated Financial Statements for additional information regarding
the Company's long-term debt.)
27
34
<PAGE>
Results of Operations
Overview
Solid earnings growth, repositioning of its telephone operations and the
continued strong growth of its cellular operations marked significant
achievements made by the Company in 1995. In preparation for heightened
competition in the telecommunications industry, the Company continued to
consolidate its local telephone service areas by completing the sale of
properties in seven states. Despite the loss of operations from this sale,
telephone's operating results remained solid, reflecting steady access line
growth in its remaining service areas and the Company's ongoing cost-control
efforts. Cellular produced strong operating results, reflecting significant
growth in its customer base. Information services' operating results reflected
growth in revenues and sales primarily due to the expansion of its
telecommunications and healthcare operations, although growth in operating
income for information services continued to be adversely impacted by the
continuing consolidations occurring in the domestic financial services and
mortgage industries. Product distribution's operating results showed improved
profitability primarily due to increased demand for its products.
In 1995, revenues and sales increased to $3,109.7 million, up from
$2,927.7 million in 1994 and $2,321.9 million in 1993. This represents an
increase of 6 percent in 1995 compared to increases of 26 percent in 1994 and
12 percent in 1993. Total costs and expenses increased to $2,425.7 million,
up from $2,293.8 million in 1994 and $1,802.8 million in 1993. This
represents an increase of 6 percent in 1995 compared to increases of 27
percent in 1994 and 11 percent in 1993. The Company's consolidated net income
for 1995 increased to $354.6 million, up from $271.8 million in 1994 and
$262.0 million in 1993, an increase of 30 percent in 1995, 4 percent in 1994
and 15 percent in 1993. Earnings per share in 1995 increased to $1.86, up
from $1.43 in 1994 and $1.39 in 1993, reflecting an increase of 30 percent in
1995 compared to increases of 3 percent in 1994 and 14 percent in 1993.
The 1995 results include a pre-tax net gain in the amount of $30.8 million
related to the sale of certain telephone properties, a write-down of the
information services check processing operations and the payment of
termination fees resulting from the early retirement of long-term debt. The
1994 results include a pre-tax write-down of $54.2 million related to the
information services check processing and community banking operations.
Excluding the impact of these non-extraordinary, one-time items, the
Company's 1995 consolidated results from operations showed double-digit
growth, with net income increasing 10 percent to $334.8 million and earnings
per share also increasing 10 percent to $1.76. (The net income impact of the
non-extraordinary, one-time items has been provided as supplemental
information only.)
35
<PAGE>
Telephone Operations
- -------------------------------------------------------------------------------
(Dollars in millions) 1995 1994 1993
- -------------------------------------------------------------------------------
Revenues and sales $1,197.7 $1,178.3 $1,016.1
Operating income $422.5 $400.2 $353.2
Access lines in service 1,623,440 1,643,041 1,576,361
- -------------------------------------------------------------------------------
Revenues and sales increased $19.4 million or 2 percent in 1995, compared to
increases of $162.2 million or 16 percent in 1994 and $68.3 million or 7
percent in 1993. Operating income increased $22.3 million or 6 percent in
1995, compared to an increase of $47.0 million or 13 percent in 1994 and an
increase of $37.4 million or 12 percent in 1993.
In November 1994, the Company signed definitive agreements to sell
telephone properties serving approximately 117,000 access lines in Arizona,
California, Nevada, New Mexico, Oregon, Tennessee, Utah and West Virginia to
Citizens Utilities Company ("Citizens") in exchange for approximately $290
million in cash, assumed debt and 3,600 access lines in Pennsylvania. The
sale of telephone properties represents a continuation of the Company's
ongoing efforts to achieve efficiencies and enhance the competitive position
of its telephone operations. The sale of properties in Oregon and West
Virginia was completed at the end of the second quarter of 1995, and the sale
of the remaining properties except for those in Nevada was completed during
the fourth quarter of 1995. The Company expects to complete the sale of the
Nevada properties in early 1996. In 1995, the disposition of properties
resulted in a pre-tax gain of $49.8 million and a net decrease in revenues
and operating income of approximately $24.0 million and $7.2 million,
respectively. Additionally, the telephone properties disposed of or to be
disposed of represent approximately 8 percent of the reported 1995 telephone
operations revenues and operating income.
In the fourth quarter of 1993, the Company purchased all the assets of the
telephone operations of GTE Corporation in Georgia ("GTE Georgia") in
exchange for the Company's telephone operations in Illinois, Indiana and
Michigan and $443 million in cash. The exchange was accounted for as a
purchase, and accordingly, GTE Georgia's results of operations have been
included in the Company's financial statements as of November 1, 1993. This
acquisition accounted for 14 percent of the increase in revenues and
operating income in 1994 and 3 percent of the increase in revenues and
operating income in 1993.
Local service revenues increased $21.7 million or 6 percent in 1995,
compared to increases of $79.3 million or 26 percent in 1994 and $27.5
million or 10 percent in 1993. The increase in local service revenues in 1995
reflects growth in customer access lines and custom calling feature revenues,
partially offset by the reduction in revenues due to the sale of telephone
properties to Citizens. Local service revenues increased in 1994 and 1993
primarily due to the GTE Georgia acquisition. Increases in customer lines and
growth in custom calling feature revenues also contributed to the growth in
local service revenues in 1994 and 1993. There were no local rate increases
28
36
<PAGE>
granted to any of the Company's telephone subsidiaries in 1995, nor are there
any rate requests currently pending before regulatory commissions. The
Company does not anticipate filing for any local rate increases during 1996.
Future access line growth is expected to result from population growth in the
Company's remaining service areas and through strategic acquisitions.
Network access and long-distance revenues decreased $6.3 million or 1
percent in 1995, compared to increases of $62.5 million or 11 percent in 1994
and $36.5 million or 7 percent in 1993. Network access and long-distance
revenues decreased in 1995 primarily due to the impact of certain regulatory
commission actions designed to reduce earnings levels in California and Ohio
and the sale of telephone properties to Citizens. Network access and
long-distance revenues increased in 1994 and 1993 primarily due to the GTE
Georgia acquisition. Increases in universal service fund revenues and higher
volumes of access usage also contributed to the growth in network access and
long-distance revenues in 1994 and 1993. The increase in revenues for 1994
was partially offset by the impact of changing from an average schedule to
cost method of settling interstate access revenues by two of the Company's
telephone operating subsidiaries.
Miscellaneous revenues increased $4.0 million or 3 percent in 1995,
compared to increases of $20.4 million or 16 percent in 1994 and $4.4 million
or 4 percent in 1993. The increase in miscellaneous revenues in 1995 was
primarily due to increases in direct sales of telephone equipment and
protection plans and directory advertising revenues, partially offset by a
reduction in revenues due to the sale of properties to Citizens. The
increases in miscellaneous revenues in 1994 and 1993 were primarily due to
the GTE Georgia acquisition and increases in directory advertising revenues.
Increases in telephone equipment sales and rentals, sales of telephone
equipment maintenance and protection plans and increases in intrastate
billing and collection revenues also contributed to the growth in revenues in
1994. The increase in revenues for 1993 was partially offset by decreases in
billing and collection revenues from AT&T.
Total telephone operating expenses decreased $2.9 million or 1 percent for
1995, compared to increases of $115.2 million or 17 percent in 1994 and $30.9
million or 5 percent in 1993. Operating expenses decreased in 1995 primarily
due to a reduction in expenses of approximately $16.8 million resulting from
the sale of properties to Citizens. Lower maintenance costs related to
buildings and electro-mechanical switching equipment and decreases in call
completion and other general and administrative expenses, reflecting the
Company's ongoing cost-control efforts, also contributed to the decrease in
operating expenses. These decreases were partially offset by higher expense
for maintenance and repair of cable, increased information services and
engineering charges, increased depreciation expense and increased cost of
products sold related to the direct sales of telephone equipment and
protection plans. The acquisition of the GTE Georgia properties accounted for
14 percent of the increase in operating expenses in 1994 and 3 percent of the
increase in 1993. In addition to the impact of the GTE Georgia acquisition,
37
<PAGE>
operating expenses increased in 1994 due to higher expense for maintenance
and repair of cable, digital switching and circuit equipment, and an increase
in cost of products sold related to the sales of telephone equipment and
protection plans. The increase in 1994 was partially offset by lower
maintenance costs related to electro-mechanical switching equipment and by a
reduction in accounting, financial and human resource management expenses
resulting from the consolidation of the Company's telephone operations.
Operating expenses increased in 1993 primarily due to higher expense for
repair and maintenance of cable, digital switching and circuit equipment, and
increased information services charges.
The Company's telephone subsidiaries follow the accounting for regulated
enterprises prescribed by Statement of Financial Accounting Standards No. 71,
"Accounting for the Effects of Certain Types of Regulation" ("SFAS 71"). If
the Company's telephone subsidiaries no longer qualified for the provisions
of SFAS 71, the accounting impact to the Company would be an extraordinary
non-cash charge to operations of an amount that would be material. Criteria
that would give rise to the discontinuance of SFAS 71 include (1) increasing
competition that restricts the telephone subsidiaries' ability to establish
prices to recover specific costs, and (2) a significant change in the manner
in which rates are set by regulators from cost-based regulation to another
form of regulation. The Company periodically reviews these criteria to ensure
the continuing application of SFAS 71 is appropriate.
Information Services Operations
- -------------------------------------------------------------------------------
(Millions) 1995 1994 1993
- -------------------------------------------------------------------------------
Revenues and sales $926.3 $861.5 $677.8
Operating income $132.0 $129.8 $116.6
- -------------------------------------------------------------------------------
Information services' revenues and sales reflect increases of $64.8 million
or 8 percent in 1995, $183.7 million or 27 percent in 1994, and $108.4
million or 19 percent in 1993. Growth in operating income for this segment
continues to be adversely affected by the number of mergers and
consolidations occurring in the domestic financial services and mortgage
industries. Operating income has also been impacted by lower margins realized
on international software sales and on new and existing outsourcing
contracts. As a result, operating income increased $2.2 million or 2 percent
in 1995, compared to increases of $13.2 million or 11 percent in 1994 and
$22.2 million or 23 percent in 1993.
Revenues and sales increased in 1995 primarily due to growth in
telecommunications and healthcare outsourcing operations. Telecommunications
revenues increased primarily due to volume growth in existing data processing
contracts and the addition of an outsourcing contract with Citizens.
Healthcare revenues increased primarily due to an acquisition completed in
November 1994 accounted for as a purchase. Additional software maintenance
revenues and an increase in the number of mortgage loans processed also
contributed to the increase in revenues and sales in 1995. Revenues and sales
29
38
<PAGE>
increased in 1994 and 1993 primarily due to new facilities management and
remote processing contracts including telecommunications, additional services
provided under existing facilities management contracts, an increase in the
number of mortgage loans processed and related reporting services and
additional fees associated with specialized programming and software
conversions. The acquisition of TDS Healthcare Systems Corporation ("TDS") in
October 1993 also contributed to the increase in revenues and sales in 1994
and 1993. The increases in revenues and sales in all periods were partially
offset by lost operations from contract terminations due to the merger and
consolidation activity in the domestic financial services market. A reduction
in revenues collected for early termination of facilities management
contracts also impacted the growth in revenues and sales in 1995. Although
the number of mortgage loans serviced increased in all periods, growth in the
related processing revenues has occurred at a slower rate due to the
consolidations in the mortgage industry, which have resulted in lower
incremental revenues realized on a per loan basis. The domestic banking
industry continues to experience a high level of consolidation due to mergers.
The increase in operating income in 1995 reflects the growth in revenues
and sales offset by the loss of higher-margin operations due to contract
terminations, reductions in fees collected on the early termination of
facilities management contracts and an increase in operating costs including
corporate operations and depreciation and amortization expense. Operating
income in 1995 was also impacted by lower margins realized on international
software sales due to increased costs to procure and support these sales. The
increase in corporate operations reflects severance pay costs related to the
workforce reduction announced in June 1995. Operating income increased in
1994 and 1993 primarily due to the revenue increases previously noted. The
growth in operating income in 1994 was slower than the growth in revenues and
sales due to increased costs to procure and support additional international
contracts, the reduction in revenues as a result of early termination of
facilities management contracts, operating losses sustained by the check
processing and community banking operations, and increased operating costs
including depreciation and amortization expense. Depreciation and
amortization expense increased in all periods due to the acquisition of
additional data processing equipment and due to an increase in the
amortization of internally developed software. Operating income in 1993 also
increased due to higher margins realized on contract termination fees.
As a result of the declining contributions from this segment's check
processing and community banking operations, the Company recorded a pre-tax
write-down of approximately $54.2 million to reflect the estimated net
realizable value of these operations in December 1994. In accordance with the
Company's plan for disposal of the check processing operations, the Company
recorded an additional $5.0 million pre-tax write-down in the second quarter
of 1995 to reflect the net realizable value of these operations. The Company
completed the sale of the check processing operations at the end of the third
quarter of 1995.
39
<PAGE>
Product Distribution Operations
- -------------------------------------------------------------------------------
(Millions) 1995 1994 1993
- -------------------------------------------------------------------------------
Revenues and sales $448.1 $436.6 $370.7
Operating income $27.3 $23.9 $17.0
- -------------------------------------------------------------------------------
Product distribution's revenues and sales increased $11.5 million or 3
percent in 1995, increased $65.9 million or 18 percent in 1994 and decreased
$6.3 million or 2 percent in 1993. Operating income increased $3.4 million or
14 percent in 1995, increased $6.9 million or 41 percent in 1994 and
decreased $1.3 million or 7 percent in 1993.
The increase in revenues and sales in 1995 was primarily due to growth in
the sale of telecommunications and data products. Revenues and sales
increased in 1994 primarily due to growth in the sale of telecommunications
and data products to new and existing customers, including sales to
affiliates, as detailed in Note 1 to the Consolidated Financial Statements.
Sales of electrical wire and cable products also increased in 1994,
reflecting increased copper prices and a slightly higher demand for these
products. The product distribution companies continue to experience
competition from other distribution companies and from direct sales by
manufacturers. Although growth in the sale of telecommunications and data
products including sales to affiliates occurred in 1993, these increases were
offset by decreased sales of electrical wire and cable products, primarily
resulting from sluggish market conditions and intense competitive pressures.
Operating income increased in 1995 and 1994 primarily due to the increase
in revenues and sales previously noted, partially offset by an increase in
selling-related expenses. Increased profit margins on electrical wire and
cable products, primarily resulting from an increase in copper prices, also
contributed to the growth in operating income in 1995 and 1994. Operating
income in 1993 decreased primarily as a result of the decrease in revenues
and sales.
Cellular Operations
- -------------------------------------------------------------------------------
(Dollars in millions) 1995 1994 1993
- -------------------------------------------------------------------------------
Revenues and sales $398.1 $287.3 $181.0
Operating income $121.5 $84.7 $44.3
Total customers 624,542 468,542 275,611
- -------------------------------------------------------------------------------
Cellular operations provided strong operating results and contributed
significantly to the Company's overall earnings growth. Revenues and sales
increased $110.8 million or 39 percent for 1995, compared to increases of
$106.3 million or 59 percent in 1994 and $70.6 million or 64 percent in 1993.
Operating income increased $36.8 million or 44 percent in 1995, $40.4 million
or 91 percent in 1994 and $23.4 million or 111 percent in 1993.
Cellular operations are expected to continue producing double-digit growth
rates in revenues and operating income in 1996. In addition, the Company will
participate in the developing Personal Communications Service ("PCS")
wireless industry through its investment in GO Communications Corporation, a
bidder in the Federal Communications Commission's "C" band PCS auction that
is scheduled to be concluded in the first quarter of 1996.
Subscriber growth remained strong, as the number of cellular customers at
year-end 1995 totaled 624,542, an increase of 156,000 customers or 33 percent
over 1994. This compares to an annual growth rate in subscribers of 70
30
40
<PAGE>
percent in 1994 and 71 percent in 1993. While the rate of subscriber growth
has declined since 1993, the overall market penetration rate (number of
customers as a percentage of the total population in the Company's service
areas) has increased from 3.6 percent at December 31, 1993, to 7.6 percent at
December 31, 1995.
Cellular operations revenues and sales increased in all periods primarily
due to the significant growth in its customer base. Partially offsetting the
increases in revenues resulting from subscriber growth were declines in the
average monthly revenue per subscriber. Average revenue per subscriber per
month was $63 for 1995, $67 for 1994 and $73 for 1993. The declines in
revenue per subscriber reflect the industry-wide trend of increased
penetration into lower-usage market segments. The acquisition of new cellular
properties and increased ownership interest in existing cellular properties
also contributed to the growth in revenues and sales in all periods.
Operating income also increased for all periods, reflecting the increases in
revenues and sales noted above, partially offset by higher expenses for
selling and advertising, depreciation and other operating expenses.
Other Operations
- -------------------------------------------------------------------------------
(Millions) 1995 1994 1993
- -------------------------------------------------------------------------------
Revenues and sales $139.5 $163.9 $76.3
Operating income $7.0 $15.3 $9.2
- -------------------------------------------------------------------------------
Other operations revenues and sales decreased $24.4 million or 15 percent in
1995, increased $87.6 million or 115 percent in 1994 and increased $13.5
million or 22 percent in 1993. Operating income decreased $8.3 million or 54
percent in 1995, increased $6.1 million or 66 percent in 1994 and increased
slightly in 1993.
Revenues and sales for other operations decreased in 1995 primarily due to
a change in accounting in late 1993 related to the publication of telephone
directories. Concurrent with the purchase of the independent telephone
directory operations of GTE Directories Corporation in October 1993, the
Company began recognizing all revenues and expenses related to a published
directory in the month of publication, instead of recognizing the revenues
and expenses ratably over a twelve-month period. As a result of this change,
revenues and sales for the year ended December 31, 1994, include approximately
$16.0 million of additional revenues related to directories accounted for
under the previous method. Revenues and sales also decreased in 1995 by
approximately $11.0 million as a result of a reduction in the number of
directories published. The increase in revenues and sales in 1994 was
primarily due to the significant growth in the Company's publishing
operations attributable to the purchase of the GTE directory publishing
operations. As a result of this acquisition, the number of directories
published during 1994 increased 134 percent. The increase in revenues and
sales in 1993 was primarily due to the purchase of the GTE directory
publishing business, partially offset by the loss of revenues due to the sale
of the Company's remaining manufacturing operations in the second quarter of
1992.
41
<PAGE>
Operating income decreased in 1995 primarily due to the decrease in
revenue and sales previously noted. Operating income for 1995 also reflects
lower margins realized on directories published for affiliates. The lower
margins resulted from increased fees paid to affiliates for publishing rights
under the terms of a new contract that became effective at the beginning of
1995. Operating income increased in 1994 primarily due to the increase in
revenues and sales, partially offset by increases in directory services
expense, contract services, and selling and marketing expenses related to the
publication of additional independent directories. Depreciation and other
operating expenses also increased in 1994 as a result of the expansion and
rapid growth in the directory publishing operations. The slight increase in
operating income in 1993 primarily resulted from the increase in revenues and
sales, partially offset by one-time costs incurred with the purchase and
start-up of the GTE directory publishing business and the reduction in income
due to the sale of the manufacturing operations.
Other Income, Net
Other income, net increased $8.5 million or 141 percent in 1995 primarily due
to an increase in the equity income recognized on investments in cellular
limited partnerships and increases in capitalized interest costs related to
long-term construction projects. In addition, other income, net does not
include the amortization of telephone plant acquisition adjustments related
to the GTE Georgia properties acquisition that have been reclassified as
depreciation and amortization expense in 1995. The increase in 1995 was
partially offset by an increase in the minority interest in earnings of the
Company's cellular operations by others.
Other income, net decreased $8.3 million in 1994 primarily due to an
increase in the minority interest in earnings of the Company's cellular
operations by others and the amortization of telephone plant acquisition
adjustments related to the GTE Georgia properties acquisition, partially
offset by an increase in equity income recognized on investments in cellular
limited partnerships. The increase in equity income in 1995 and 1994 reflects
the improved operating results of those cellular partnerships in which the
Company has an investment interest.
Other income, net decreased $11.1 million or 83 percent in 1993 primarily
due to the elimination of equity income recognized from the Company's
investment in WorldCom, Inc. (formerly LDDS Communications, Inc.). This
investment is accounted for under the cost method since the Company's
ownership is currently less than 20 percent and control is not exercised by
the Company.
Interest Expense
Interest expense increased $8.3 million or 6 percent in 1995, increased $38.4
million or 39 percent in 1994 and increased $5.5 million or 6 percent in
1993. The increase in interest expense in 1995 reflects the issuance of $250
million of debentures in April 1994 to reduce borrowings under the Company's
revolving credit agreement, partially offset by the reduction in interest
expense resulting from the refinancing of $200 million of debentures
completed in October 1995, as previously discussed. The increase in interest
expense in 1994 reflects both the issuance of the $250 million of debentures
in April 1994 and the issuance of $400 million of debentures in November 1993
to finance the GTE Georgia properties acquisition, as previously discussed. The
increase in interest expense in 1993 is primarily due to the issuance of the
$400 million of debentures.
31
42
<PAGE>
Gain on Disposal or Exchange of Assets, Write-down of Assets and Other
In 1995, the Company recorded pre-tax gains totaling $49.8 million from the
disposal of certain telephone properties to Citizens. The Company also
recorded an additional pre-tax write-down of $5.0 million to reflect the net
realizable value of its information services segment's check processing
operations. Finally, the Company incurred $14.0 million of termination fees
related to the early retirement of $200 million of long-term debt. The net
income impact from these transactions resulted in an increase of $19.8
million in net income and $.10 in earnings per share for the year ended
December 31, 1995.
In 1994, the Company recorded a pre-tax write-down of $54.2 million to
reflect the estimated net realizable value of its information services
segment's community banking and check processing operations. This write-down
decreased net income by approximately $32 million and earnings per share by
$.17 for the year ended December 31, 1994.
In 1993, the Company recorded a gain on the exchange of telephone
properties with GTE, which was partially offset by the reorganization of its
telephone operations as a result of this transaction. During the fourth
quarter of 1993, the Company also recorded a partial write-down to reflect an
impairment in the carrying value of its product distribution operations. The
net income impact from these transactions is not significant to the results
of operations.
Income Taxes
Income tax expense increased $52.4 million or 32 percent in 1995, decreased
$23.1 million or 12 percent in 1994 and increased $59.2 million or 46 percent
in 1993. The increase in income tax expense in 1995 primarily resulted from
an increase in taxable income for financial reporting purposes. The decrease
in income taxes in 1994 was primarily due to the tax benefit resulting from
the write-down of the information services operations. The increase in income
taxes for 1993 resulted primarily from an increase in taxable income and
additional taxes due to the Revenue Reconciliation Act of 1993, which
increased the statutory federal corporate income tax rate 1 percent to 35
percent effective January 1, 1993. Income taxes for 1993 do not reflect a tax
benefit from the write-down of the product distribution operations in 1993
since utilization of this benefit is not certain.
Average Common Shares Outstanding
The average number of common shares outstanding increased slightly in 1995.
During 1995, common shares issued through stock option plans amounted to
1,227,000 shares, and debentures and preferred stock were converted into
60,000 shares. The average number of common shares outstanding increased 1
percent in 1994. In 1994, common shares issued through stock option plans
amounted to 535,000 shares, 324,000 shares were issued for the acquisition of
a subsidiary, and debentures and preferred stock were converted into 71,000
shares. These increases were offset by the Company's repurchase on the open
43
<PAGE>
market of 407,000 shares of its own common shares. In June 1993, 92,559,000
common shares were issued in connection with a 2-for-1 stock split. The
average number of common shares outstanding increased 1 percent in 1993,
primarily due to the issuance of approximately 2 million common shares for
the acquisition of TDS. Also in 1993, common shares issued upon exercise of
stock options amounted to 721,000 common shares, and debentures and preferred
stock were converted into 81,000 shares.
Other Financial Information
In October 1995, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 123, "Stock-Based Compensation" ("SFAS
123"). This new standard, effective for calendar year 1996 financial
statements, encourages entities to adopt a fair value method of measuring
compensation cost for employee stock option plans. Under the prescribed
method, compensation cost would be measured at the grant date based on the
fair value of the award and would be recognized over the related service
period. An entity that does not adopt the fair value method of accounting
will be required to include in its financial statements pro forma disclosures
of net income and earnings per share as if the fair value method of
accounting had been applied. The Company is evaluating the alternatives
available under SFAS 123. If the fair value method is not elected, management
does not expect the pro forma net income and earnings per share disclosures
to be materially different from the actual 1996 operating results reported by
the Company.
In March 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of." This new
standard, effective for calendar year 1996 financial statements, requires
impairment losses on long-lived assets to be recognized when an asset's book
value exceeds its expected future cash flows (undiscounted). The new standard
also imposes stricter criteria for retention of regulatory-created assets by
requiring that such assets be probable for future recovery at each balance
sheet date. The impact of implementing this standard, given the regulatory
uncertainties related to the Company's telephone operations and the continued
application of SFAS 71 as previously discussed, cannot be determined at this
time.
Management is currently not aware of any environmental matters which in
the aggregate would have a material adverse effect on the financial condition
or results of operations of the Company.
32
44
<PAGE>
Report of Independent Public Accountants
To the Shareholders of ALLTEL Corporation:
We have audited the accompanying consolidated balance sheets of ALLTEL
Corporation (a Delaware corporation) and subsidiaries as of December 31, 1995
and 1994, and the related consolidated statements of income, shareholders'
equity and cash flows for each of the three years in the period ended
December 31, 1995. These financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of ALLTEL Corporation and
subsidiaries as of December 31, 1995 and 1994, and the results of their
operations and their cash flows for each of the three years in the period
ended December 31, 1995, in conformity with generally accepted accounting
principles.
/s/ Arthur Andersen LLP
Little Rock, Arkansas,
January 22, 1996
33
45
<PAGE>
<TABLE>
<CAPTION>
Selected Financial Data
For the years ended December 31,
(Dollars in thousands, except per share amounts)1995 1994 1993 1992 1991 1990
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Revenues and Sales:
Service revenues $2,441,826 $2,249,933 $1,811,808 $1,565,544 $1,371,724 $1,172,019
Product sales 667,899 677,743 510,082 501,865 500,305 512,173
Total revenues and sales 3,109,725 2,927,676 2,321,890 2,067,409 1,872,029 1,684,192
- -----------------------------------------------------------------------------------------------------------------------------
Costs and Expenses:
Cost of products sold 449,119 422,078 332,923 344,076 345,124 355,002
Operating expenses 1,976,628 1,871,732 1,469,921 1,280,591 1,154,066 961,296
Total costs and expenses 2,425,747 2,293,810 1,802,844 1,624,667 1,499,190 1,316,298
- -----------------------------------------------------------------------------------------------------------------------------
Operating Income 683,978 633,866 519,046 442,742 372,839 367,894
Other income, net 2,481 (6,064) 2,230 13,364 12,117 11,973
Interest expense (145,428) (137,120) (98,746) (93,245) (94,244) (87,465)
Gain on disposal or exchange of assets,
write-down of assets and other 30,775 (54,157) 27,390 (5,512) 8,347 -
Income before income taxes 571,806 436,525 449,920 357,349 299,059 292,402
Income taxes 217,190 164,772 187,903 128,713 99,633 92,275
Net income 354,616 271,753 262,017 228,636 199,426 200,127
Preferred dividends 1,158 1,232 1,578 1,742 2,543 2,878
Net income applicable
to common shares $353,458 $270,521 $260,439 $226,894 $196,883 $197,249
- -----------------------------------------------------------------------------------------------------------------------------
Primary Earnings per Share $1.86 $1.43 $1.39 $1.22 $1.09 $1.09
Dividends per common share $.98 $.90 $.82 $.77 $.71 $.66
Common shares -
average including equivalents 190,072,000 189,454,000 187,665,000 185,672,000 180,007,000 181,453,000
at year end 189,268,000 187,981,000 187,458,000 184,678,000 177,796,000 171,951,000
Total assets $5,073,105 $4,713,878 $4,270,458 $3,125,976 $2,957,232 $2,774,584
Total shareholders' equity $1,935,565 $1,625,369 $1,554,708 $1,304,454 $1,127,878 $1,043,771
Total redeemable preferred stock
and long-term debt $1,768,682 $1,853,979 $1,604,659 $1,027,803 $1,057,277 $1,003,844
- -----------------------------------------------------------------------------------------------------------------------------
<FN>
Note: On November 1, 1993, the Company purchased substantially all of the assets of the telephone operations of GTE
Corporation in the State of Georgia ("GTE Georgia"). This acquisition was accounted for as a purchase, and accordingly,
GTE Georgia's results have been included in the Company's consolidated financial statements as of November 1, 1993. (See
Note 2 to the Consolidated Financial Statements for further information regarding this acquisition.)
</FN>
</TABLE>
34
46
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Income
- -----------------------------------------------------------------------------------------------------------------------------
For the years ended December 31,
(Dollars in thousands, except per share amounts) 1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Revenues and Sales:
Service revenues $2,441,826 $2,249,933 $1,811,808
Product sales 667,899 677,743 510,082
Total revenues and sales 3,109,725 2,927,676 2,321,890
- -----------------------------------------------------------------------------------------------------------------------------
Costs and Expenses:
Cost of products sold 449,119 422,078 332,923
Operations 1,352,561 1,292,251 989,848
Maintenance 147,898 151,248 131,159
Depreciation and amortization 409,799 361,963 289,812
Taxes, other than income taxes 66,370 66,270 59,102
Total costs and expenses 2,425,747 2,293,810 1,802,844
- -----------------------------------------------------------------------------------------------------------------------------
Operating Income 683,978 633,866 519,046
Other income, net 2,481 (6,064) 2,230
Interest expense (145,428) (137,120) (98,746)
Gain on disposal or exchange of assets,
write-down of assets and other 30,775 (54,157) 27,390
Income before income taxes 571,806 436,525 449,920
Income taxes 217,190 164,772 187,903
Net income 354,616 271,753 262,017
Preferred dividends 1,158 1,232 1,578
Net income applicable to common shares $353,458 $270,521 $260,439
- -----------------------------------------------------------------------------------------------------------------------------
Primary Earnings per Share $1.86 $1.43 $1.39
- -----------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
35
47
<PAGE>
<TABLE>
<CAPTION>
Consolidated Balance Sheets
- -----------------------------------------------------------------------------------------------------------------------------
December 31,
(Dollars in thousands)
- -----------------------------------------------------------------------------------------------------------------------------
Assets 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current Assets:
Cash and short-term investments $21,421 $26,098
Accounts receivable (less allowance for doubtful
accounts of $18,439 and $21,510, respectively) 582,797 533,244
Materials and supplies 22,191 24,348
Inventories 89,667 94,458
Prepaid expenses 15,165 14,579
Total current assets 731,241 692,727
- -----------------------------------------------------------------------------------------------------------------------------
Investments 611,706 332,748
Excess of cost over equity in purchased entities 480,070 494,861
- -----------------------------------------------------------------------------------------------------------------------------
Property, Plant and Equipment:
Telephone 3,733,468 3,756,894
Information services 468,648 380,182
Cellular 462,397 324,258
Other 28,965 25,011
Under construction 148,349 210,496
Total property, plant and equipment 4,841,827 4,696,841
Less accumulated depreciation 1,869,075 1,733,610
Net property, plant and equipment 2,972,752 2,963,231
- -----------------------------------------------------------------------------------------------------------------------------
Other assets 277,336 230,311
- -----------------------------------------------------------------------------------------------------------------------------
Total Assets $5,073,105 $4,713,878
- -----------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated balance sheets.
</TABLE>
36
48
<PAGE>
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
Liabilities and Shareholders' Equity 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Current Liabilities:
Current maturities of long-term debt $36,892 $51,676
Accounts payable 213,944 259,723
Advance payments and customers' deposits 73,660 57,042
Accrued taxes 58,341 21,171
Accrued dividends 49,149 45,158
Other current liabilities 137,298 170,845
Total current liabilities 569,284 605,615
- -----------------------------------------------------------------------------------------------------------------------------
Deferred Credits:
Investment tax 21,821 31,077
Income taxes 544,435 385,469
Total deferred credits 566,256 416,546
- -----------------------------------------------------------------------------------------------------------------------------
Long-term debt 1,761,604 1,846,150
Other liabilities 233,318 212,369
Preferred stock, redeemable 7,078 7,829
- -----------------------------------------------------------------------------------------------------------------------------
Shareholders' Equity:
Preferred stock 9,241 9,320
Common stock 189,268 187,981
Additional capital 355,663 339,436
Unrealized holding gain on investments 208,681 84,275
Retained earnings 1,172,712 1,004,357
Total shareholders' equity 1,935,565 1,625,369
- -----------------------------------------------------------------------------------------------------------------------------
Total Liabilities and Shareholders' Equity $5,073,105 $4,713,878
- -----------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated balance sheets.
</TABLE>
37
49
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Cash Flows
- -----------------------------------------------------------------------------------------------------------------------------
For the years ended December 31,
(Dollars in thousands) 1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cash Provided from Operations:
Net income $354,616 $271,753 $262,017
Non-cash operating activities:
Depreciation and amortization 409,799 361,963 289,812
Gain on disposal or exchange of assets,
write-down of assets and other (19,849) 32,223 (48,669)
Other, net 41,366 41,355 35,380
Increase in deferred credits 65,246 32,754 19,096
Changes in operating assets and liabilities:
Accounts receivable (71,541) (181,997) (84,854)
Inventories, including materials and supplies 5,101 (27,812) (8,749)
Accounts payable (42,096) 38,154 41,050
Other current liabilities (5,051) (13,192) 44,557
Other, net (48,405) 21,989 13,848
Net cash provided from operations 689,186 577,190 563,488
- -----------------------------------------------------------------------------------------------------------------------------
Cash Used (Provided) in Investing:
Additions to property, plant and equipment 523,064 596,112 426,171
Purchase of subsidiaries, net of cash acquired - - 443,000
Sale of property (212,911) - -
Additions to capitalized software development costs 52,308 53,547 24,230
Additions to investments 33,729 9,464 20,441
Other, net 72,019 (3,920) 62,306
Net cash used in investing activities 468,209 655,203 976,148
- -----------------------------------------------------------------------------------------------------------------------------
Cash Used (Provided) in Financing:
Dividends on preferred and common stock 182,270 166,349 148,493
Reductions in long-term debt 277,636 147,784 91,136
Purchase of common stock - 10,932 -
Preferred stock redemptions and purchases 1,137 438 3,813
Long-term debt issued (218,164) (404,883) (627,804)
Common stock issued (17,225) (16,850) (5,756)
Net cash used (provided) in financing activities 225,654 (96,230) (390,118)
- -----------------------------------------------------------------------------------------------------------------------------
Increase (decrease) in cash and short-term investments (4,677) 18,217 (22,542)
Cash and Short-term Investments:
Beginning of year 26,098 7,881 30,423
End of year $21,421 $26,098 $7,881
- -----------------------------------------------------------------------------------------------------------------------------
Supplemental Cash Flow Disclosures:
Interest paid $141,751 $129,788 $91,574
Income taxes paid $112,690 $150,224 $163,583
- -----------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
38
50
<PAGE>
<TABLE>
<CAPTION>
Consolidated Statements of Shareholders' Equity
For the years ended December 31,
(Dollars in thousands, except per share amounts) 1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Preferred Stock:
Balance at beginning of the year $9,320 $9,405 $9,488
Conversion of preferred stock (79) (85) (83)
Balance at end of the year 9,241 9,320 9,405
- -----------------------------------------------------------------------------------------------------------------------------
Common Stock:
Balance at beginning of the year 187,981 187,458 92,339
Employee plans 1,227 535 721
Acquisition of subsidiary - 324 1,758
Conversion of preferred stock and debentures 60 71 81
Stock split - - 92,559
Repurchase of stock - (407) -
Balance at end of the year 189,268 187,981 187,458
- -----------------------------------------------------------------------------------------------------------------------------
Additional Capital:
Balance at beginning of the year 339,436 333,698 399,955
Employee plans 15,998 7,815 20,485
Acquisition of subsidiary - 8,176 5,422
Conversion of preferred stock and debentures 229 272 395
Stock split - - (92,559)
Repurchase of stock - (10,525) -
Balance at end of the year 355,663 339,436 333,698
- -----------------------------------------------------------------------------------------------------------------------------
Unrealized Holding Gain on Investments:
Balance at beginning of the year 84,275 121,507 -
Change in unrealized holding gain on investments 124,406 (37,232) 121,507
Balance at end of the year 208,681 84,275 121,507
- -----------------------------------------------------------------------------------------------------------------------------
Retained Earnings:
Balance at beginning of the year 1,004,357 902,640 802,672
Acquisition of subsidiary - - (7,939)
Net income for the year 354,616 271,753 262,017
Dividends:
Common per share, $.98 in 1995,
$.90 in 1994 and $.82 in 1993 (185,103) (168,804) (152,532)
Preferred (1,158) (1,232) (1,578)
Balance at end of the year 1,172,712 1,004,357 902,640
Total shareholders' equity $1,935,565 $1,625,369 $1,554,708
- -----------------------------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these consolidated financial statements.
</TABLE>
39
51
<PAGE>
<TABLE>
<CAPTION>
Business Segments
- -----------------------------------------------------------------------------------------------------------------------------
For the years ended December 31,
(Dollars in thousands) 1995 1994 1993
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Revenues and Sales:
Telephone:
Local service $411,434 $389,784 $310,495
Network access and long-distance 637,731 644,020 581,520
Miscellaneous 148,508 144,473 124,079
Total telephone 1,197,673 1,178,277 1,016,094
Information services 926,345 861,500 677,753
Product distribution 448,119 436,643 370,692
Cellular 398,122 287,346 181,018
Other operations 139,466 163,910 76,333
Total $3,109,725 $2,927,676 $2,321,890
- -----------------------------------------------------------------------------------------------------------------------------
Operating Income:
Telephone $422,542 $400,207 $353,194
Information services 132,043 129,765 116,608
Product distribution 27,338 23,920 16,994
Cellular 121,507 84,655 44,292
Other operations 7,040 15,270 9,191
Corporate expenses (26,492) (19,951) (21,233)
Total $683,978 $633,866 $519,046
- -----------------------------------------------------------------------------------------------------------------------------
Identifiable Assets:
Telephone $2,782,471 $2,909,028 $2,795,984
Information services 745,451 632,518 468,490
Product distribution 168,578 163,628 157,561
Cellular 694,890 573,314 401,791
Other operations 58,243 65,601 28,157
Corporate 623,472 369,789 418,475
Total $5,073,105 $4,713,878 $4,270,458
- -----------------------------------------------------------------------------------------------------------------------------
Capital Expenditures:
Telephone $308,468 $331,395 $257,238
Information services 77,871 124,005 110,169
Product distribution 2,034 6,029 707
Cellular 121,274 107,647 52,918
Other operations and corporate 13,417 27,036 5,139
Total $523,064 $596,112 $426,171
- -----------------------------------------------------------------------------------------------------------------------------
Depreciation and Amortization Expense:
Telephone $243,975 $229,474 $191,076
Information services 102,033 88,627 64,861
Product distribution 1,277 1,181 1,520
Cellular 54,856 36,821 26,444
Other operations and corporate 7,658 5,860 5,911
Total $409,799 $361,963 $289,812
- -----------------------------------------------------------------------------------------------------------------------------
(Refer to page 46 for additional information concerning business segments.)
</TABLE>
40
52
<PAGE>
Notes to Consolidated Financial Statements
1. Accounting Policies:
Consolidation - The consolidated financial statements include the accounts of
ALLTEL Corporation, its subsidiary companies and majority-owned partnerships
(the "Company"). Investments in 20% to 50% owned entities and all
unconsolidated partnerships are accounted for using the equity method. Other
investments are recorded in accordance with Statement of Financial Accounting
Standards No. 115 (see Note 3). All intercompany transactions, except those
with certain affiliates described below, have been eliminated in the
consolidated financial statements.
Financial Statement Presentation - The preparation of the consolidated
financial statements in conformity with generally accepted accounting
principles requires management to make estimates and assumptions that affect
the reported amounts of assets, liabilities, revenues and expenses and
disclosure of contingent assets and liabilities. The estimates and assumptions
used in the accompanying consolidated financial statements are based upon
management's evaluation of the relevant facts and circumstances as of the date
of the financial statements. Actual results may differ from the estimates
and assumptions used in preparing the accompanying consolidated financial
statements.
Service revenues consist of local service, network access and miscellaneous
telephone operating revenues, information services' data processing, software
licensing and maintenance revenues, and cellular access and network usage
revenues. Product sales revenues consist of the product distribution and
directory publishing operations and telephone and information services'
equipment sales. Certain prior-year amounts have been reclassified to conform
with the 1995 financial statement presentation.
Transactions with Certain Affiliates - ALLTEL Supply, Inc. sells equipment
and materials to telephone subsidiaries of the Company ($137,951,000 in 1995,
$140,410,000 in 1994 and $93,232,000 in 1993) as well as to other telephone
companies and related industries. The cost of equipment and materials sold to
such subsidiaries is included, principally, in telephone plant in the
consolidated financial statements. ALLTEL Information Services, Inc. provides
the data processing services for the Company's telephone operations
($85,131,000 in 1995, $77,427,000 in 1994 and $65,925,000 in 1993) in
addition to other companies. Intercompany profit, to the extent not offset
by depreciation on the capitalized cost of equipment and materials, has not
been eliminated because prices charged by the supply and information services
subsidiaries are comparable to prices the individual telephone subsidiaries
would be required to pay other suppliers and are recovered through the
regulatory process.
53
<PAGE>
Cash and Short-term Investments - Cash and short-term investments consist of
highly liquid investments with original maturities of less than three months.
These investments are readily convertible into cash.
Inventories - Inventories are stated at the lower of cost or market value.
Cost is determined using the first-in, first-out method of valuation.
Property, Plant and Equipment - Property, plant and equipment are stated at
original cost. Depreciation is computed using the straight-line method for
financial reporting purposes. The composite depreciation rates by class of
property as a percent of average depreciable plant and equipment were:
- ------------------------------------------------------------------------------
1995 1994 1993
- ------------------------------------------------------------------------------
Telephone 6.4% 6.3% 6.4%
Information services 15.7 16.3 16.9
Cellular 12.7 12.2 12.6
Other 9.6 9.7 10.0
- ------------------------------------------------------------------------------
For the Company's telephone operations, when utility property, plant and
equipment are retired, the original cost, net of salvage, is charged against
accumulated depreciation. All other property, plant and equipment retirements
are recorded at net book value plus salvage, if any, with the corresponding
gain or loss recognized in the accompanying consolidated statements of income.
The cost of maintenance and repairs of property, plant and equipment, including
the cost of replacing minor items not affecting substantial betterments, is
charged to maintenance expense as incurred. The Company capitalized estimated
interest during periods of construction.
Excess of Cost Over Equity in Purchased Entities - Excess of cost over
equity of $453,779,000 relating to certain entities purchased subsequent to
November 1970 is being amortized on a straight-line basis for periods up to
40 years. Amortization expense amounted to $17,890,000 in 1995, $15,427,000 in
1994 and $12,633,000 in 1993. The carrying value of the excess cost over
equity is periodically evaluated by the Company for the existence of impairment
on the basis of whether the excess of cost over equity is fully recoverable
from projected, undiscounted net cash flows of the related business unit.
Investment Tax Credit - The investment tax credit is amortized to income
over the productive lives of the related property, plant and equipment.
41
54
<PAGE>
Revenue Recognition - Telephone revenues are recognized when earned and are
primarily derived from usage of the Company's local exchange networks and
facilities or under revenue-sharing arrangements with other telecommunications
carriers. Information services revenues consist of data processing revenue
recognized as services are performed, software licensing revenue recognized
when delivery of the software occurs, and software maintenance revenue
recognized ratably over the maintenance period. Certain long-term contracts
are accounted for using the percentage-of-completion method. Under this method,
revenue and profit are recognized throughout the term of the contract, based
upon estimates of the total costs to be incurred and revenues to be generated
throughout the term of the contract. Changes in estimates for revenues, costs
and profits are recognized in the period in which they are determinable. In
accordance with contractual arrangements with customers, cellular access
service revenue is recognized when billed, while revenue from network usage
is recognized when the services are rendered. For all other operations,
revenue is recognized when products are delivered or services are rendered to
customers.
Included in accounts receivable and other assets are unbilled receivables
related to the information services segment totaling $173,014,000 and
$111,853,000 at December 31, 1995 and 1994, respectively. Included in these
unbilled receivables are amounts totaling $84,297,000 and $38,744,000 at
December 31, 1995 and 1994, respectively, which represent costs and estimated
earnings in excess of billings related to one long-term contract accounted for
under the percentage-of-completion method.
Computer Software Development Costs - For the Company's information services
operations, research and development expenditures related to internally
developed computer software are charged to expense as incurred. The development
costs of software to be marketed are charged to expense until technological
feasibility is established. After that time, the remaining software development
costs are capitalized and recorded in other assets in the accompanying
consolidated balance sheets. As of December 31, 1995 and 1994, capitalized
software development costs, net of amortization, were $135,123,000 and
$106,651,000, respectively. Amortization of the capitalized amounts is
computed on a product-by-product basis using primarily the straight-line
method over the remaining estimated economic life of the product, not exceeding
five years. Amortization expense amounted to $29,468,000 in 1995, $19,727,000
in 1994 and $13,165,000 in 1993.
Earnings Per Share - Primary earnings per share of common stock was
determined by dividing net income applicable to common shares by the average
number of common shares outstanding, including common stock equivalents, during
each year. The numbers of shares used in computing primary earnings per share
were 190,072,000 in 1995, 189,454,000 in 1994 and 187,665,000 in 1993.
Conversion of all convertible preferred stock and convertible debentures would
not have a significant dilutive effect on earnings per share.
55
<PAGE>
2. Acquisitions:
On November 1, 1993, the Company purchased substantially all of the assets of
the telephone operations of GTE Corporation in the State of Georgia
("GTE Georgia") in exchange for the Company's telephone operations in Illinois,
Indiana and Michigan, which had a net book value of $112 million, and $443
million in cash. This acquisition was accounted for as a purchase. GTE
Georgia's results of operations are included in the accompanying consolidated
statements of income beginning November 1, 1993, and the excess cost resulting
from this transaction is being amortized on a straight-line basis over 40
years.
Unaudited pro forma consolidated results of operations, as though the
Company acquired GTE Georgia on January 1, 1993, are as follows:
- -------------------------------------------------------------------------------
(Thousands, except per share)
- -------------------------------------------------------------------------------
1993
- -------------------------------------------------------------------------------
Revenues and sales $2,487,068
Income before income taxes $496,523
Net income applicable to common shares $288,370
Primary earnings per share $1.53
- -------------------------------------------------------------------------------
3. Financial Instruments and Investment Securities:
The carrying amount of cash and short-term investments approximates fair value
due to the short maturity of the instruments. The fair value of investments is
$611.7 million based on the quoted market price and the carrying value of
investments for which there is no quoted market price. The fair value of the
Company's long-term debt, after deducting current maturities, is estimated to
be $1.857 billion in 1995 and $1.757 billion in 1994, compared to a carrying
value of $1.762 billion in 1995 and $1.846 billion in 1994. The fair value
estimates are based on the overall weighted rates and maturity compared to
rates and terms currently available in the long-term financing markets. The
fair value of the Company's redeemable preferred stock is estimated to be
$16.9 million in 1995 and $19.0 million in 1994 compared to a carrying amount
of $7.1 million in 1995 and $7.8 million in 1994. The fair value estimates are
based on the conversion of the Series D convertible redeemable preferred stock
to common stock of the Company and the carrying value of the Series A
redeemable preferred stock for which there is no quoted market price. The fair
value of all other financial instruments is estimated by management to
approximate the carrying value.
Equity securities owned by the Company have been classified as
available-for-sale and are reported at fair value, with unrealized gains and
losses reported, net of tax, in a separate component of shareholders' equity.
The Company had unrealized gains, net of tax, on its investment in
WorldCom, Inc. (formerly LDDS Communications, Inc.) of $208.7 million,
$84.3 million and $121.5 million at December 31, 1995, 1994 and 1993,
respectively. The unrealized gains, including the related tax impact, are
non-cash items and accordingly have been excluded from the accompanying
consolidated statements of cash flows. All other unrealized gains and losses
on investments in equity securities are not material to the Company's financial
position or results of operations.
42
56
<PAGE>
4. Debt:
Long-term debt, after deducting current maturities, was as follows at
December 31:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994
- -------------------------------------------------------------------------------
First mortgage bonds and collateralized notes,
Weighted rate 8.7% in 1995 and 8.8% in 1994
Weighted maturity 6 years in 1995 and 1994 $19,797 $25,118
Debentures and notes, without collateral,
Weighted rate 7.6% in 1995 and 8.1% in 1994
Weighted maturity 14 years in 1995 and 16 years in 1994 1,254,859 1,307,223
Industrial revenue bonds and collateralized notes,
Weighted rate 6.0% in 1995 and 5.3% in 1994
Weighted maturity 10 years in 1995 and 1994 8,475 8,732
Revolving credit agreement,
Weighted rate 6.0% in 1995 and 6.6% in 1994
Weighted maturity 3 years in 1995 and 1994 151,490 132,005
Rural Utilities Service notes,
Weighted rate 4.2% in 1995 and 4.4% in 1994
Weighted maturity 16 years in 1995 and 18 years in 1994 66,149 100,392
Rural Telephone Bank and Federal Financing Bank notes,
Weighted rate 7.8% in 1995 and 8.2% in 1994
Weighted maturity 18 years in 1995 and 19 years in 1994 260,834 272,680
Total long-term debt $1,761,604 $1,846,150
- -------------------------------------------------------------------------------
Weighted rate 7.3% 7.7%
Weighted maturity 14 years 16 years
- -------------------------------------------------------------------------------
The Company has a $500 million revolving credit agreement which has a
termination date of October 1, 1998, with provision for annual extensions. It
is the Company's intention to continue to renew the agreement. The revolving
credit agreement provides a variety of pricing options.
The indentures and agreements, as amended, provide, among other things, for
various restrictions on the payment of dividends by the Company. Retained
earnings unrestricted as to payment of dividends by the Company amounted to
$934.1 million at December 31, 1995. Certain properties have been pledged as
collateral on $355.3 million of obligations.
Interest expense on long-term debt amounted to $144.4 million in 1995,
$135.2 million in 1994 and $96.2 million in 1993.
Maturities and sinking fund requirements for the four years after 1996 for
long-term debt outstanding, excluding the revolving credit agreement as of
December 31, 1995, were $39.7 million, $46.2 million, $52.6 million and $44.6
million for the years 1997 through 2000, respectively.
57
<PAGE>
5. Common Stock:
There are 500,000,000 shares of $1 par value common stock authorized of which
189,267,712 and 187,980,669 shares were outstanding at December 31, 1995 and
1994, respectively. At December 31, 1995, the Company had 18,064,452 common
shares reserved for issuance in connection with convertible preferred stock
(945,131) and stock options (17,119,321).
The Company's stock option plan provides for the granting of options to
officers, directors and key employees at prices not less than the market value
of the stock at the date of grant.
The following is a summary of stock options outstanding, granted, exercised
and cancelled:
- -------------------------------------------------------------------------------
Average Price
Shares Per Share
- -------------------------------------------------------------------------------
1995 1994 1995 1994
- -------------------------------------------------------------------------------
Outstanding at beginning
of period 6,811,202 6,945,928 $20.32 $19.06
Granted 126,000 650,500 26.15 26.41
Exercised (1,472,983) (553,194) 12.45 11.59
Cancelled (257,710) (232,032) 25.05 21.35
Outstanding at end of period 5,206,509 6,811,202 $22.45 $20.32
- -------------------------------------------------------------------------------
Exercisable at end of period 3,001,109 3,178,800 $19.84 $15.44
Reserved for future options 11,912,812 11,784,812
- -------------------------------------------------------------------------------
For stock options exercisable at December 31, 1995 and 1994, the option prices
ranged from $11.21 to $29.00 and from $6.58 to $29.00, respectively.
During 1993, 1,014,495 shares were exercised at an average price of $10.14
per share.
43
58
<PAGE>
6. Preferred Stock:
Cumulative preferred stock is issuable in series, and the Board of Directors
is authorized to designate the number of shares and fix the terms. There are
50,000,000 $25 par value voting shares and 50,000,000 no par value non-voting
shares authorized.
The outstanding cumulative preferred stock, which is not redeemable at the
option of the holder, was as follows at December 31:
- -------------------------------------------------------------------------------
Quarterly Amount Outstanding
Dividend (Thousands)
Per Share 1995 1994 1993
- -------------------------------------------------------------------------------
$25 par value:
Series A, 5%
Shares - 39,853 in 1995, 1994 and 1993 $.31 1/4 $996 $996 $996
Series C, 5%
Shares - 5,000 in 1995, 1994 and 1993 .31 1/4 125 125 125
Series E, 6%
Shares - 32,000 in 1995, 1994 and 1993 .37 1/2 800 800 800
Series F, 5 1/2%
Shares - 245,955 in 1995, 1994 and 1993 .34 3/8 6,149 6,149 6,149
Series H, 6%
Shares - 12,184 in 1995, 1994 and 1993 .37 1/2 305 305 305
Series I, 5 1/2%
Shares - 4,000 in 1995, 1994 and 1993 .34 3/8 100 100 100
Series J, 6%
Shares - 1,800 in 1995, 1994 and 1993 .37 1/2 45 45 45
No par value:
Series C, $2.06 Convertible
Shares - 28,855 in 1995, 31,991
in 1994 and 35,419 in 1993 .51 1/2 721 800 885
$9,241 $9,320 $9,405
- -------------------------------------------------------------------------------
The $25 par value preferred stock may be redeemed at the option of the
Company at par value. The no par value Series C preferred shares are
convertible at any time prior to redemption into 5.963 shares of the Company's
common stock. The rate of conversion is subject to adjustment under certain
conditions.
The outstanding cumulative preferred stock, which is redeemable at the
option of the holder, was as follows at December 31:
- -------------------------------------------------------------------------------
Quarterly Amount Outstanding
Dividend (Thousands)
Per Share 1995 1994 1993
- -------------------------------------------------------------------------------
No par value:
Series A, 7 3/4%
Shares - 50,200 in 1995, 55,600
in 1994 and 61,000 in 1993 $1.93 3/4 $5,020 $5,560 $6,100
Series D, $2.25 Convertible
Shares - 73,500 in 1995, 81,046
in 1994 and 90,240 in 1993 .56 1/4 2,058 2,269 2,527
$7,078 $7,829 $8,627
- -------------------------------------------------------------------------------
The Company's Series A preferred stock is redeemed through required annual
sinking fund payments. The sinking fund requirements in each of the five years
ending December 31, 1996 through 2000 amount to $540,000.
59
<PAGE>
In addition to redemption at the option of the holder and through required
sinking fund payments at the stated value per share, the Company may at its
option, under certain conditions, redeem outstanding cumulative preferred stock
at varying premiums above par or stated value.
The Company's Series D stock is convertible at any time prior to redemption
into 5.486 shares of the Company's common stock. The rate of conversion is
subject to adjustment under certain conditions. During 1995, $211,000 of
Series D stock was converted. The stock may be redeemed at the option of the
Company or the holder at the $28 per share stated value.
7. Retirement Plans:
The Company has a trusteed, noncontributory, defined benefit pension plan
which provides retirement benefits for eligible employees of the Company.
Pension benefits are based on an employee's years of service and compensation.
The Company's funding policy for the defined benefit contributions is to
satisfy the funding requirements of the Employees' Retirement Income Security
Act of 1974 ("ERISA").
Certain key officers have unfunded executive compensation agreements that
provide retirement benefits in lieu of payments under the Company's pension
plan.
Pension expense (credit), including provision for executive compensation
agreements, totaled $5,662,000 in 1995, $2,225,000 in 1994 and $(3,892,000) in
1993.
Pension expense (credit) includes the following components:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------
Benefits earned during the year $14,966 $13,386 $10,504
Interest cost on projected
benefit obligation 22,301 21,410 16,964
Actual return on plan assets (61,720) 13,092 (34,176)
Net amortization and deferral 30,115 (45,663) 2,816
Pension expense (credit) $5,662 $2,225 $(3,892)
- -------------------------------------------------------------------------------
The following table presents the funded status of the plan at December 31:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994
- -------------------------------------------------------------------------------
Actuarial present value of accumulated benefit
obligation, including vested benefits
of $262,972 in 1995 and $209,783 in 1994 $272,277 $217,557
Actuarial present value of projected
benefit obligation 323,381 261,171
Plan assets at fair value 369,091 316,235
Plan assets in excess of projected benefit
obligation 45,710 55,064
Unrecognized net gain (10,534) (21,925)
Remaining unrecognized prior service cost (5,432) (5,982)
Unrecognized transition asset being
amortized over 16 years (9,466) (10,650)
Prepaid pension expense $20,278 $16,507
- -------------------------------------------------------------------------------
44
60
<PAGE>
Actuarial assumptions used to calculate the projected benefit obligations
were 7.25% for the settlement rate in 1995 and 8.5% in 1994, and 5% for future
compensation level increases in 1995 and 1994. The investment earnings rate was
9% in 1995 and 1994. The increases in the actuarial present value of the
accumulated benefit obligation and the projected benefit obligation for 1995
primarily resulted from the change in the settlement rate assumption. Assets
of the plan consist primarily of listed stocks, including common stock of the
Company amounting to $17,437,000 and $17,480,000 at December 31, 1995 and 1994,
respectively, and corporate and government debt.
The Company has a noncontributory defined contribution plan in the form of
profit sharing arrangements for eligible employees, except bargaining unit
employees. The amount of profit sharing contributions to the plan is determined
annually by the Company's Board of Directors. Profit sharing expense amounted
to $28,672,000 in 1995, $26,351,000 in 1994 and $22,717,000 in 1993.
8. Postretirement Benefits Other Than Pensions:
The Company provides postretirement healthcare and life insurance benefits for
eligible employees. The healthcare benefit is based on comprehensive hospital,
medical and surgical benefit provisions, while the life insurance is based on
annual earnings at the time of retirement. The employees share in the cost of
these benefits. The Company is not currently funding these plans.
The postretirement expense includes the following components:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994
- -------------------------------------------------------------------------------
Benefits earned $112 $426
Amortization of transition obligation 976 976
Other amortization and deferral (918) (3)
Interest cost on accumulated postretirement
benefit obligation 2,454 2,722
Postretirement expense $2,624 $4,121
- -------------------------------------------------------------------------------
The following table presents the plan status at December 31:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994
- -------------------------------------------------------------------------------
Accumulated postretirement benefit obligation:
Retirees $37,392 $27,621
Fully eligible active plan participants 1,088 884
Other active plan participants 2,413 1,799
Total accumulated postretirement benefit obligation 40,893 30,304
Unrecognized net gain 3,168 12,695
Unrecognized prior service cost (2,152) (434)
Unrecognized transition obligation being amortized
over 20 years (16,590) (17,566)
Accrued postretirement benefit obligation $25,319 $24,999
- -------------------------------------------------------------------------------
61
<PAGE>
Actuarial assumptions used to calculate the accumulated post-retirement
benefit obligation were 7.25% for the weighted average discount rate in 1995
and 8.5% for 1994, and 11% for the healthcare cost trend rate in 1995 and 12%
for 1994, decreasing on a graduated basis to an ultimate rate of 6% in the year
2000. A one percentage point change in the assumed healthcare cost trend rate
for each future year would change the postretirement benefit cost by
approximately $125,000 for the year ended December 31, 1995, and the
accumulated postretirement benefit obligation as of December 31, 1995, by
approximately $2.2 million.
The increase in the accumulated postretirement benefit obligation for 1995
primarily resulted from the change in the discount rate assumption and due to
actual healthcare costs and claims incurred exceeding projected amounts.
9. Gain on Disposal or Exchange of Assets, Write-down of Assets and Other:
During the fourth quarter of 1995, the Company recorded a pre-tax gain of $18.9
million on the sale of its telephone properties in Arizona, California,
New Mexico, Tennessee and Utah to Citizens Utilities Company ("Citizens"), and
the Company incurred $14.0 million of termination fees related to the early
retirement of $200 million of long-term debt. During the second quarter of
1995, the Company recorded a pre-tax gain of $30.9 million on the sale of its
telephone properties in West Virginia and Oregon to Citizens, and the Company
recorded an additional pre-tax write-down of $5.0 million to reflect the net
realizable value of its information services segment's check processing
operations. The net income impact from these transactions resulted in an
increase of $.10 in earnings per share for the year ended December 31, 1995.
In 1994, the Company recorded a write-down of $54.2 million to reflect the
estimated net realizable value of its information services segment's community
banking and check processing operations. This write-down resulted in a decrease
of $.17 in earnings per share in 1994.
In 1993, the Company recorded a gain on the exchange of telephone properties
with GTE Corporation, which was partially offset by the reorganization of its
telephone operations as a result of this transaction. These transactions
amounted to $69.9 million. In addition, the Company recorded a write-down of
$42.5 million in 1993 to reflect an impairment in the carrying value of its
product distribution operations. The net income impact from these transactions
is not significant to the results of operations.
45
62
<PAGE>
10. Income Taxes:
Income tax expense was as follows:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------
Federal $181,947 $137,277 $158,376
State and other 35,243 27,495 29,527
$217,190 $164,772 $187,903
- -------------------------------------------------------------------------------
The federal income tax expense consists of the following:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------
Currently payable $128,589 $104,359 $119,489
Deferred 62,614 40,416 46,289
Investment tax credit amortized (9,256) (7,498) (7,402)
$181,947 $137,277 $158,376
- -------------------------------------------------------------------------------
Deferred income tax expense results principally from temporary differences
between depreciation expense for income tax purposes and depreciation expense
recorded in the financial statements. Deferred tax balances are adjusted to
reflect tax rates, based on currently enacted tax laws, that will be in effect
in the years in which the temporary differences are expected to reverse. For
the Company's regulated operations, the adjustment in deferred tax balances
for the change in tax rates is reflected as a regulatory asset or liability.
These regulatory assets and liabilities are amortized over the lives of the
related depreciable asset or liability concurrent with recovery in rates.
Differences between the federal income tax statutory rates and effective
income tax rates, which include both federal and state income taxes, were as
follows:
- -------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------
Statutory income tax rates 35.0% 35.0% 35.0%
Increase (decrease):
Investment tax credit (1.6) (1.7) (1.6)
State income taxes, net of
federal benefit 4.0 4.1 4.3
Reversal of excess deferred
federal taxes (0.2) (0.6) (0.9)
Write-down of product distribution
operations - - 3.3
Other items 0.8 1.0 1.7
Effective income tax rates 38.0% 37.8% 41.8%
- -------------------------------------------------------------------------------
During 1993, the write-down of the product distribution operations resulted
in capital losses for which the tax benefit can only be recognized to the
extent of available capital gains. Without this write-down, the effective
income tax rate would have been 38.5% in 1993.
63
<PAGE>
The significant components of the Company's net deferred income tax
liability were as follows at December 31:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994
- -------------------------------------------------------------------------------
Property, plant and equipment $346,482 $320,556
Capitalized computer software 49,365 34,860
Unrealized holding gain on investments 150,161 63,659
Other, net (1,573) (33,606)
Total $544,435 $385,469
- -------------------------------------------------------------------------------
At December 31, 1995 and 1994, total deferred tax assets were $211.8 million
and $236.1 million, respectively, and total deferred tax liabilities were
$756.2 million and $621.6 million, respectively.
11. Other Income, Net:
The components of other income, net were as follows:
- -------------------------------------------------------------------------------
(Thousands)
- -------------------------------------------------------------------------------
1995 1994 1993
- -------------------------------------------------------------------------------
Equity earnings in unconsolidated partnerships $20,282 $11,662 $7,753
Minority interest in consolidated partnerships (28,997) (20,038) (10,219)
Capitalized interest during construction 6,221 3,361 2,005
Interest and dividend income 1,052 919 1,341
Other non-operating income (expense) 3,923 (1,968) 1,350
$2,481 $(6,064) $2,230
- -------------------------------------------------------------------------------
12. Business Segments:
The Company's telephone operating subsidiaries provide primary local service
and network access in 15 states. Information services provides electronic
information processing services and software primarily through long-term
contracts and markets other information processing products and services to
the financial, telecommunications and healthcare industries. The principal
markets for information services' products and services are commercial banks
and financial institutions, other telephone and cellular companies and
healthcare providers in the United States and major international markets.
Product distribution sells equipment and materials to affiliated and
non-affiliated telephone companies and related industries in the United States
and electrical and electronic wire and cable to other domestic distributors and
wholesalers. Cellular includes cellular mobile telephone services in various
major U.S. markets. Other operations primarily include directory publishing and
wide-area paging services. Corporate identifiable assets consist primarily of
cash, investments and headquarters facilities and equipment. Corporate items
represent general corporate expenses and assets not allocated to segments.
(Refer to Page 40 for a schedule of business segment information.)
46
64
<PAGE>
13. Quarterly Financial Information - (Unaudited)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------------
(Dollars in thousands, except per share amounts) 1995 1994
- -----------------------------------------------------------------------------------------------------------------------------------
Total 4th 3rd 2nd 1st Total 4th 3rd 2nd 1st
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues and sales $3,109,725 $773,855 $785,779 $786,476 $763,615 $2,927,676 $757,474 $738,880 $728,898 $702,424
Operating income $683,978 $177,302 $175,355 $169,783 $161,538 $633,866 $155,553 $166,128 $161,908 $150,277
Net income $354,616 $92,577 $85,312 $98,104 $78,623 $271,753 $43,952 $79,728 $76,187 $71,886
Preferred dividends 1,158 275 287 279 317 1,232 301 304 317 310
Net income applicable to
common shares $353,458 $92,302 $85,025 $97,825 $78,306 $270,521 $43,651 $79,424 $75,870 $71,576
Primary earnings per share $1.86 $.48 $.45 $.52 $.41 $1.43 $.23 $.42 $.40 $.38
- -----------------------------------------------------------------------------------------------------------------------------------
Net income and earnings per share
excluding gain on disposal or
exchange of assets, write-down
of assets and other:
Net income $334,767 $89,335 $85,312 $81,497 $78,623 $303,976 $76,175 $79,728 $76,187 $71,886
Primary earnings per share $1.76 $.47 $.45 $.43 $.41 $1.60 $.40 $.42 $.40 $.38
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends per common share $.98 $.26 $.24 $.24 $.24 $.90 $.24 $.22 $.22 $.22
- -----------------------------------------------------------------------------------------------------------------------------------
<FN>
Note: A. Fourth quarter 1995 net income includes a pre-tax gain of $18.9 million from the sale of certain telephone
properties and $14.0 million of termination fees related to the early retirement of long-term debt. These
transactions increased net income by $3.2 million or $.01 per share. (See Note 9)
B. Second quarter 1995 net income includes a pre-tax gain of $30.9 million from the sale of certain telephone
properties and an additional pre-tax write-down of $5.0 million on the Company's check processing operations.
These transactions increased net income by $16.6 million or $.09 per share. (See Note 9)
C. Fourth quarter 1994 net income includes a pre-tax write-down of $54.2 million on the Company's check processing
and community banking operations. This transaction decreased net income by approximately $32 million or $.17 per
share. (See Note 9)
D. All adjustments necessary for a fair presentation of results for each period have been included.
</FN>
</TABLE>
47
65
<PAGE>
Investor Information
Corporate Headquarters
ALLTEL Corporation
One Allied Drive
Little Rock, Arkansas 72202
(501) 661-8000
Annual Meeting
The Annual Meeting of ALLTEL Corporation stockholders will be held at 11 a.m.
(CDT) on Thursday, April 25, 1996, at Arkansas' Excelsior Hotel, Ballroom
Level, Three Statehouse Plaza, Little Rock, Arkansas.
Transfer Agent, Registrar
and Dividend Disbursing Agent
KeyCorp Shareholder Services, Inc.
P.O. Box 6477
Cleveland, OH 44101-1477
Common Stock Price and Dividend Information
Ticker Symbol AT
Newspaper Listings ALLTEL, ALTEL
Market Price
Q
- -------------------------------------------------------------------------------
1995 4th 31 1/8 27 3/8 29 1/2 .26
3rd 30 1/4 25 1/8 29 7/8 .24
2nd 29 3/4 23 1/4 25 3/8 .24
1st 31 27 3/4 28 3/4 .24
- -------------------------------------------------------------------------------
1994 4th 31 3/8 25 1/2 30 1/8 .24
3rd 28 1/2 25 27 .22
2nd 27 1/2 24 25 1/8 .22
1st 29 1/2 25 25 5/8 .22
- -------------------------------------------------------------------------------
The common stock is listed and traded on the New York and Pacific Stock
Exchanges. The above table reflects the range of high, low and closing prices
as reported by Dow Jones & Company, Inc.
Annual Report on Form 10-K
The 1995 report on Form 10-K filed with the Securities
and Exchange Commission is available without charge
to stockholders upon request to the Corporate Headquarters.
Investor Relations
Information requests from investors, security analysts, other members of the
investment community and the news media should be addressed to Shawne Leach,
Vice President - Investor Relations, at One Allied Drive, Little Rock, Arkansas
72202 (501) 661-8999.
Shareholder Services
General questions about accounts, stock certificates or dividends may be
directed to the Shareholder Services Department, 50 Executive Parkway, Hudson,
Ohio 44236 (216) 650-7108.
Dividend Reinvestment and Stock Purchase Plan
ALLTEL offers a Dividend Reinvestment and Stock Purchase Plan for registered
common stockholders. In addition to reinvesting dividends, the plan allows
participants to invest cash toward the purchase of ALLTEL common stock. Further
information about dividend reinvestment may be obtained from the Shareholder
Services Department.
Electronic Dividend Deposit
ALLTEL offers Electronic Dividend Deposit to registered common stockholders.
Electronic deposit allows dividend payments to be automatically deposited into
a checking or savings account and eliminates the inconvenience of delayed or
lost dividend checks. More information about Electronic Dividend Deposit may
be obtained from the Shareholder Services Department.
(INSIDE BACK COVER)
66
Exhibit 10(b)(2)
RETIREMENT AGREEMENT
This Retirement Agreement, dated as of
December 27, 1995 ("Agreement"), is made among ALLTEL CORPORATION, a Delaware
corporation (as defined below, the "Corporation"), ALLTEL INFORMATION
SERVICES, INC., a Delaware corporation and a subsidiary of the Corporation
("AIS"), ALLTEL FINANCIAL INFORMATION SERVICES, INC., an Arkansas corporation
and a wholly-owned subsidiary of AIS (the "Subsidiary"), and JOHN E. STEURI
(the "Executive").
The Executive is a party to the Executive
Compensation Agreement (as defined in paragraph (H) of Section 1) under which
the Executive would be permitted to retire on or after May 6, 1999. During
recent months, however, the Executive has expressed to the Corporation his
desire to retire in 1996, rather than in 1999. This Agreement specifies the
terms and conditions governing the Executive's early retirement and the
related agreements of the parties with respect thereto.
Accordingly, in consideration of the mutual
covenants contained herein, the Corporation, AIS and the Subsidiary, and the
Executive agree as follows:
1. DEFINED TERMS. For purposes of this
Agreement, the following terms shall have the meanings indicated below:
(A) "ALLTEL Profit-Sharing Plan" means the
ALLTEL Corporation Profit-Sharing Plan, as amended.
(B) "ALLTEL Thrift Plan" means the ALLTEL
Corporation Thrift Plan, as amended.
(C) "Benefit Restoration Plan" means the
ALLTEL Corporation Benefit Restoration Plan, as amended.
(D) "Board" or "Board of Directors" means the
Board of Directors of the Corporation.
(E) "Corporation" means ALLTEL Corporation and
any successor to its business or assets by operation of law or otherwise.
(F) "Deferred Compensation Plan" means the
ALLTEL Corporation Executive Deferred Compensation Plan, as amended.
(G) "Employee Stock Purchase Plan" means the
Stock Purchase Plan for Employees of Systematics Information Services, Inc.
and its affiliates, as amended.
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<PAGE>
(H) "Executive Compensation Agreement" means
the Executive Compensation Agreement between the Subsidiary and the
Executive, dated as of April 17, 1990.
(I) "Indemnity Agreement" means the ALLTEL
Corporation Directors and Officers Indemnity Agreement, dated May 31, 1990,
between the Corporation and the Executive.
(J) "Long-Term Plan" means the ALLTEL
Corporation Long-Term Performance Incentive Plan, as amended.
(K) "Releasee" or "Releasees" has the meaning
specified in subparagraph (i) of paragraph (F) of Section 4 herein.
(L) "Short-Term Plan" means the ALLTEL
Corporation Performance Incentive Compensation Plan, as amended.
2. RETIREMENT OF EXECUTIVE.
(A) Retirement. The Executive retires from
employment with the Corporation and any subsidiary of the Corporation (as an
employee and as an officer) and resigns as a director of any subsidiary of
the Corporation of which he is a director, in each case effective on the
earliest of (i) the close of business on May 31, 1996, (ii) the death of the
Executive, and (iii) any date to which the Corporation and the Executive
agree in a writing that refers to this paragraph (A) (the "Effective Date").
The Executive acknowledges and agrees that he shall not be eligible to
receive any payments or benefits under any severance plan, program, or policy
of the Corporation or any subsidiary of the Corporation. The Corporation
agrees to continue the Executive's employment until the Effective Date
(notwithstanding any intervening physical or mental disability of the
Executive) at the Executive's compensation in effect on the date of this
Agreement, to continue to reimburse the Executive, until the Effective Date,
for the Executive's current monthly country club membership at the Country
Club of Little Rock and customary out-of-pocket expenses reasonably incurred
by the Executive in performing his duties, and to provide the Executive,
until the Effective Date, with the employee benefits and arrangements to
which the Executive is entitled on the date of this Agreement. The
Corporation's obligations under the immediately preceding sentence
automatically shall terminate on the Effective Date, and the Executive
thereafter shall have no rights and be entitled to no benefits under the
Executive Compensation Agreement or otherwise of any type or description
other than the rights and benefits specified in this Agreement. During the
period following the date of this Agreement and until the Effective Date, the
Executive will continue to serve under the direction of the Chief Executive
Officer of the Corporation as Chairman and Chief Executive Officer of AIS,
until a successor is appointed as Chief Executive Officer of AIS at any time
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prior to the Effective Date, in which case the Executive thereupon will cease
to have the title Chairman and Chief Executive Officer of AIS (although the
Executive's status as an employee will continue until the Effective Date).
(B) Certain Insurance Benefits and
Arrangements.
(i) The Corporation agrees to maintain until
the Effective Date, the long-term disability insurance coverage referred to
in Section III of the Executive Compensation Agreement.
(ii) The Executive shall be entitled to
participate, until the Effective Date, in the Corporation's group life,
travel, and accident insurance plans.
(iii) The Corporation agrees to maintain, until
the later of the Effective Date or the expiration of any renewal period (not
exceeding one year) that begins after the date of this Agreement and prior to
the Effective Date, the decreasing term life insurance policy referred to in
Section III of the Executive Compensation Agreement.
(iv) In the event the Effective Date occurs by
reason of the death of the Executive, the Corporation agrees to pay to his
wife, Grace D. Steuri, if she survives him (in addition to the payments
specified in paragraph (A) of Section 3), or otherwise to his estate, 100% of
the Executive's salary for the period of twelve months immediately preceding
the month in which his death occurs, which shall be made in 12 consecutive
monthly installments beginning no later than 30 days after the date of the
Executive's death.
(C) Corporate Board Membership. The Executive
and the Corporation agree that the Executive's membership on the Board of
Directors shall end on April 25, 1996, at the end of the Executive's current
term thereof, unless terminated sooner by the Executive's resignation or
death. The Executive shall be entitled to attend any meeting of the Board of
Directors occurring after the date of this Agreement through and including
the date his membership terminates in accordance with the immediately
preceding sentence, and to receive any materials provided to directors for
any such meeting.
3. CERTAIN COVENANTS OF THE CORPORATION AND
RELATED PROVISIONS.
(A) Joint and Spouse Survivor Retirement
Payments. Subject to the provisions of this Agreement, including, without
limitation, paragraph (C) of Section 4, the Corporation agrees to pay to the
Executive, following the Effective Date (unless occasioned by the Executive's
death) and until the Executive's death (notwithstanding any intervening
physical or mental disability of the Executive), bi-weekly retirement
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payments (calculated on the basis of 26 payments per year), each in the
amount of $3,709.37, and continuing during the Executive's lifetime, the last
bi-weekly payment being for the bi-weekly period during which the Executive's
death occurs. In the event the Executive is survived by his wife, Grace D.
Steuri, the Corporation shall pay to her, for the remainder of her lifetime,
bi-weekly payments, each in the amount of $1,854.68, following the Effective
Date (if occasioned by the Executive's death) or otherwise commencing on the
bi-weekly payment date immediately following the last bi-weekly payment date
for which the Executive received a payment in accordance with the immediately
preceding sentence and continuing during her lifetime, the last payment being
for the bi-weekly period during which her death occurs. The Corporation and
the Executive agree (and the Executive acknowledges) that the retirement
payments to be made by the Corporation in accordance with this paragraph (A)
shall be in lieu of any payments or benefits under any pension plan of the
Corporation or any subsidiary or affiliate of the Corporation, including, but
not limited to, the ALLTEL Corporation Pension Plan (as in effect from time
to time) (hereinafter, a "Company Pension Plan"), that the Executive has not
been, is not, and shall not be a participant in any Company Pension Plan, and
that neither the Executive, his spouse, nor any other person or entity,
claiming through the Executive has, has had, or shall have any right to any
benefit or payment from any Company Pension Plan. The Executive's right to
bi-weekly payments, and, in the event the Executive is survived by his wife,
Grace D. Steuri, Grace D. Steuri's right to bi-weekly payments, under this
paragraph (A), and any associated property right or interest, is a personal
and individual right or interest. The Executive also acknowledges and agrees
that the Corporation would have no contractual or legal obligation
whatsoever, whether under the Executive Compensation Agreement or otherwise,
to pay the retirement payments specified in this paragraph (A) in the absence
of this Agreement and that the foregoing payments are consideration for
Executive's agreements specified in paragraph (C) of Section 4 and the
performance by the Executive of his obligations thereunder.
(B) Health and Dental Coverage. Subject to the
provisions of this Agreement, including, without limitation, paragraph (C) of
Section 4, the Corporation agrees to provide to the Executive and to the
Executive's spouse, during the Executive's lifetime, health and dental
coverage not less favorable than the health and dental coverage(s) provided
by the Corporation and its subsidiaries, from time to time, to similarly
situated active senior executives of the Corporation and of its subsidiaries,
as applicable, and at a cost to the Executive no greater than such similarly
situated active senior executives. However, in the event the Executive, at
any time prior to May 6, 1999, commences full-time employment with any other
company or enterprise (which shall not include a bona fide consulting or
other third party contractor relationship), the Executive shall be obligated
to pay the entire cost of the foregoing health and dental coverage for so
long as the Executive is employed on a full-time basis by any such other
company or enterprise at any time or from time to time, but, upon the
Executive's termination of full-time employment with any such other company
or enterprise, the Executive's rights under the first sentence of this
paragraph (B) shall be reinstated. In the event the Executive's wife, Grace
D. Steuri, survives the Executive, the Corporation shall provide to Grace D.
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Steuri, for the remainder of her lifetime, the coverage specified in the
first sentence of this paragraph (B), without regard to the second sentence
of this paragraph (B). Notwithstanding the foregoing provisions of this
paragraph (B), the Corporation may provide all or any portion of the
foregoing health and dental coverage(s) through the purchase by the
Corporation of insurance, and the Corporation may coordinate against any
government-provided (or similar) coverage with the other coverage as primary.
(C) Incentive Plans.
(i) The Executive acknowledges that he has no
right or entitlement of any type or description under the Short-Term Plan
with respect to any year other than 1995 and, if the Effective Date occurs
after December 31, 1995, the portion of 1996, beginning on January 1, 1996
and ending on the Effective Date (other than the right to awards with respect
to any such other year that were deferred and remain unpaid, to which
paragraph (G) of this Section 3 shall apply).
(ii) The Executive acknowledges that he has no
right or entitlement of any type or description under the Long-Term Plan with
respect to any period other than, if the Effective Date occurs on or after
December 31, 1995, 1993 through 1995 (other than the right to awards with
respect to any such other year that were deferred and remain unpaid, to which
paragraph (G) of this Section 3 shall apply).
(iii) Any awards to which the Executive is
entitled under the Short-Term Plan, the Long-Term Plan, or both, shall be
paid to the Executive at the time awards are paid to the Corporation's
officers, in accordance with the terms of those plans.
(D) Profit-Sharing and Thrift Plans.
(i) The Executive's vested interest under the
ALLTEL Profit-Sharing Plan shall be paid following the Effective Date in
accordance with the terms of that plan and at such time or times as may be
required thereunder.
(ii) The Executive's vested interest under the
ALLTEL Thrift Plan shall be paid following the Effective Date in accordance
with the terms of that plan and at such time or times as may be required
thereunder.
(E) Benefit Restoration Plan. The Executive's
vested interest under the Benefit Restoration Plan shall be paid following
the Effective Date in accordance with the terms of that plan and at such time
or times as may be required thereunder.
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(F) Stock Options; Employee Stock Purchase Plan.
(i) Notwithstanding any provision of the
applicable stock option plan or option agreement to the contrary, the
Executive's vested interest in the options to purchase common stock of the
Corporation held by the Executive on the date of this Agreement and that
remain unvested as of the Effective Date shall be 100 percent.
(ii) Subject to the foregoing provisions of this
paragraph (F), all matters pertaining to the foregoing options shall be
governed by the applicable stock option plan and option agreement.
(iii) All shares of common stock of the
Corporation and cash in the Executive's account under the Employee Stock
Purchase Plan shall be delivered to the Executive following the Effective
Date in accordance with the terms and at such time or times as may be
required thereunder.
(G) Deferrals Under Deferred Compensation Plan.
The Executive's vested interest under the Deferred Compensation Plan, the
Short-Term Plan, and the Long-Term Plan shall be paid in accordance with the
terms of and at such time or times as may be provided under the terms thereof.
(H) Rabbi Trust. As of the date of this
Agreement, the Executive is a beneficiary under the trust established by a
Trust Agreement between the Corporation and Nationsbank Texas, N.A., dated
July 20, 1993 (the "Rabbi Trust"), with respect to the Executive's rights and
benefits under the Executive Compensation Agreement, the Benefit Restoration
Plan and the Deferred Compensation Plan, and the Corporation has made certain
contributions for the Executive's account thereunder the balance of which
totaled approximately $60,000 as of the date of this Agreement. The
Corporation agrees that, subject to and in reliance upon the acknowledgments
by the Executive in the immediately following sentence, the Corporation will,
for so long as the Corporation continues to maintain the Rabbi Trust with
executive officers of the Corporation as beneficiaries, maintain the
Executive as a beneficiary thereunder with respect to the Executive's rights
and benefits referred to above and the Executive's rights and benefits under
this Agreement (in substitution for the Executive Compensation Agreement),
will maintain balances in the Executive's account under the Rabbi Trust from
time to time consistent with the manner in which the Corporation maintains
balances in the accounts of the executive officers of the Corporation, and
will provide the Executive, upon his request, with reasonable documentation
verifying that the Corporation is in compliance with the provisions of this
paragraph (H). The Executive acknowledges that the Rabbi Trust is a revocable
trust under which a beneficiary is entitled to exercise no rights prior to a
"change of control" (as defined thereunder), that no beneficiary has any
"vested" right or entitlement thereunder of any type or description prior to
such a "change of control" and that, in the event the Corporation, prior to
such a change of control, amends or terminates the Rabbi Trust (which the
Corporation has the unqualified right to do in its sole discretion) or its
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application to the executive officers of the Corporation, the Corporation's
agreements in the immediately preceding sentence automatically shall
terminate.
(I) Disclosure By the Corporation. The
Corporation shall have the right to disclose this Agreement and the terms
hereof in the Corporation's proxy statement with respect to its 1996 annual
meeting of stockholders and in the Corporation's Form 10-K Report for its
fiscal year ended December 31, 1995, and otherwise to the extent the
Corporation determines that disclosure is either required by applicable law
or regulation or is in the Corporation's best interest. To the extent
reasonably practicable, the Corporation shall afford the Executive a
reasonable opportunity to review and comment upon any such disclosure prior
to the making thereof. With respect to any other announcement or publicity
related to the Executive's retirement, the Executive and the Corporation
intend to announce that the Executive will retire in May 1996 and is making
the announcement at this time to provide management continuity during the
period required to name a successor. The Executive and the Corporation agree
to collaborate on the form and content of such other announcement or
publicity and to make no such announcement or publication unless the form and
content are acceptable to both the Corporation and the Executive.
4. CERTAIN OTHER AGREEMENTS.
(A) Return of Property. On the Effective Date,
the Executive shall deliver to the Corporation all of the Corporation's and
its subsidiaries' property in the Executive's possession, custody or control,
including, without limitation, all keys and credit cards, and all files,
documents, data and information in any medium relating in any way to the
Corporation and its subsidiaries' or its or their employees, suppliers,
customers or business. On the Effective Date, the Corporation shall deliver
all of the Executive's personal property in the Corporation's or any of its
subsidiaries' possession, custody or control.
(B) Non-Disclosure. The Executive acknowledges
that, in the course of his employment with the Corporation or any of its
subsidiaries, he has had access to confidential information or trade secrets
that are proprietary to the Corporation and its subsidiaries, including,
without limitation, information relating to the Corporation's and its
subsidiaries' suppliers and customers, the sources, costs and prices of the
Corporation's and its subsidiaries' products and services, the names,
addresses, contact persons, purchasing and sales histories, and preference of
the Corporation's and its subsidiaries' suppliers and customers, the
Corporation's and its subsidiaries' business plans and strategies, and the
names and addresses of, amounts of compensation paid to, and the trading and
sales performance of the Corporation's and its subsidiaries employees and
agents (the "Confidential Information"). The Executive further acknowledges
that the Confidential Information is proprietary to the Corporation and its
subsidiaries, that the unauthorized disclosure of any of the Confidential
Information to any person or entity will result in immediate and irreparable
competitive injury to the Corporation and its subsidiaries, and that such
injury cannot adequately be remedied by an award of monetary damages. The
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Executive agrees not to disclose at any time any Confidential Information to
any person or entity without the prior written permission of the Corporation.
(C) Non-Competition.
(i) The Executive agrees that the Executive
will not, during the period beginning on the Effective Date (unless
occasioned by the Executive's death) and continuing thereafter until the one
year anniversary thereof (the "Period"), directly or indirectly (whether as
an officer, director, employee, sales representative, agent, principal,
proprietor, consultant, advisor, partner, lender, investor or otherwise)
engage in, assist or have any interest in any person, firm, entity, business
or enterprise that (1) is engaged in any aspect of the communications or
telecommunications business or industry in which the Corporation, or any of
its subsidiaries or affiliates, is engaged as a material portion of its
business on the Effective Date or at any time during the Period, (2) is
engaged in any aspect of the information or data processing management,
outsourcing services or application software business or industry in which
the Corporation, or any of its subsidiaries or affiliates, is engaged as a
material portion of its business on the Effective Date or at any time during
the Period or (3) is engaged in any other business in which the Corporation,
or any of its subsidiaries or affiliates, is engaged as a material portion of
its business on the Effective Date or at any time during the Period; except
that the foregoing provisions of this paragraph (C) shall not prevent the
Executive from (x) owning, solely for investment purposes, up to 5% of the
issued and outstanding capital stock of any publicly traded company, (y)
continuing to serve on the Board of Directors (and any committees thereof) of
National Computer Systems Inc. or as a Trustee or on any Board of Trustee
committees of Northwestern Mutual Life Insurance Company or (z) serving on
the board of directors of any other company that the Chief Executive Officer
of the Corporation approves in writing (which shall not be unreasonably
withheld).
(ii) The Corporation and the Executive agree that
the Executive's agreement in (i) above (the "Noncompete Agreement") is the
principal inducement for the Corporation's willingness to enter into this
Agreement and make the retirement payments and provide the benefits to the
Executive contemplated by paragraphs (A) and (B) of Section 3 and that the
Corporation and the Executive intend the Noncompete Agreement to be binding
upon and enforceable against the Executive in accordance with its terms,
notwithstanding any common or statutory law to the contrary. Accordingly,
the Executive and the Corporation agree that, in the event the Executive
commences any action, suit or proceeding to invalidate the enforceability of
the Noncompete Agreement or adjudicate the limits or scope of its provisions,
or in the event the Executive asserts, in any action, suit or proceeding by
the Corporation against the Executive for a breach by the Executive of the
Noncompete Agreement that the Noncompete Agreement is invalid or
unenforceable in any respect or to any extent, the Corporation shall be
immediately excused from making, and shall be entitled immediately to
terminate, the payments and benefits contemplated by paragraphs (A) and (B)
of Section 3, irrespective of the outcome of any such action, suit or
proceeding.
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(D) Confidentiality. Except as otherwise
contemplated by paragraph (I) of Section 3, the terms of this Agreement shall
remain confidential and shall not be disclosed by or permitted to be
disclosed by the Executive to any persons other than the Executive's counsel,
financial advisor, accountant, his spouse, Grace D. Steuri, and his son David
J. Steuri, and to any other person or entity required by applicable law, and
each person to whom the Executive is permitted to and does disclose the terms
of this Agreement shall be advised by the Executive of this confidentiality
agreement and shall be directed to observe the requirements thereof, except
to the extent the Corporation has disclosed this Agreement in accordance with
paragraph (I) of Section 3. The Executive's obligations under this paragraph
(D) automatically shall terminate on the earlier of the fifth year
anniversary date of this Agreement or the date of the Executive's death.
(E) Reciprocal Release and Covenant Not to Sue.
(i) In consideration of the retirement payments
and other benefits to be provided by the Corporation under this Agreement,
the sufficiency of which as good and valuable consideration the Executive
hereby acknowledges, the Executive, for and on behalf of himself, his heirs,
executors, administrators and assigns, hereby releases and discharges the
Corporation, its subsidiaries and affiliates, and their respective officers,
directors, employees, trustees, administrators, employee benefit plans, all
other representatives of the Corporation and agents of any of the foregoing,
and their successors and assigns (hereinafter the "Releasees"), from and
against any and all claims, liabilities, causes of action, debts, demands,
charges and claims of any nature whatsoever of any and every kind, whether in
tort, contract or pursuant to constitution, statute or regulation, and
whether for attorneys' fees or otherwise, which he now has, whether known or
unknown, accrued or matured, arising out of the employment relationship
between the Executive and the Corporation or any Releasee or the termination
thereof, except for the amounts, rights and benefits under this Agreement or
under the Indemnity Agreement. The foregoing release includes, but is not
limited to, all claims for compensation and fringe or other benefits and is a
complete and legally binding general release that releases all claims that
the Executive has or may have against any Releasee under local, state or
federal laws concerning civil rights, age discrimination, disability,
employee benefits, wrongful discharge, workers' compensation or any other
claims that may have arisen in connection with his employment with the
Corporation or any Releasee or the termination thereof. The Executive agrees
not to file any claim, charge, lawsuit or the like against any of the
Releasees concerning any matter in any way connected with his employment with
the Corporation or any Releasee or the termination thereof. The foregoing
release and covenant not to sue, however, does not apply to any amount, right
or benefit to which the Executive is entitled under this Agreement or under
the Indemnity Agreement.
(ii) In consideration of the covenants by the
Executive under this Agreement, the sufficiency of which as good and valuable
consideration the Corporation hereby acknowledges, the Corporation, for and
on behalf of itself, its subsidiaries and their respective successors and
assigns, hereby releases and discharges the Executive and his spouse, heirs,
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executors, administrators and assigns from and against any and all claims,
liabilities, causes of action, debts, demands, charges and claims of any
nature whatsoever of any and every kind, whether in tort, contract or
pursuant to constitution, statute or regulation, and whether for attorneys'
fees or otherwise, which the Corporation or any of its subsidiaries now has,
whether known or unknown, accrued or matured, arising out of the employment
relationship between the Executive and the Corporation, or any of its
subsidiaries, except for the amounts, rights and benefits under this
Agreement or under the Indemnity Agreement. The Corporation agrees not to
file any claim, charge, lawsuit or the like against the Executive concerning
any matter in any way connected with his employment with the Corporation or
any of the Corporation's subsidiaries.
5. TERMINATION OF OTHER AGREEMENTS. Except for
the Indemnity Agreement and as otherwise expressly provided in this
Agreement, this Agreement shall terminate any and all other agreements or
arrangements between the Corporation or any of its subsidiaries and the
Executive under which the Corporation or any such subsidiary would be
obligated to make any payment to or pay any benefit to or with respect to the
Executive or any person or entity claiming through the Executive, including,
but not limited to, the Executive Compensation Agreement, and neither the
Corporation nor any subsidiary of the Corporation shall have any obligation
to make any such payment or pay any such benefit.
6. GENERAL PROVISIONS.
(A) Each and every provision of this Agreement is
subject to, and shall become effective only upon, express approval by the
Executive Committee of the Board and the execution by Grace D. Steuri of the
paragraph immediately following the Executive's signature on the signature
page of this Agreement. The Corporation shall seek approval of this
Agreement by the Executive Committee of the Board on or before January 5,
1996. On or before January 5, 1996, the Corporation shall notify the
Executive of the Executive Committee of the Board's decision whether to
approve this Agreement, which, in the case of such approval, shall be
accompanied by a certified resolution to that effect. If this Agreement is
not approved by the Executive Committee of the Board on or before January 5,
1996, or if Grace D. Steuri fails to sign the paragraph referred to in the
first sentence of this paragraph (A) concurrent with the signature of this
Agreement by the Executive, this Agreement shall be rendered void ab initio
and of no force or effect whatsoever.
(B) Warranties. Each party warrants that it or
he fully understands this Agreement; that no promise or inducement has been
offered to it or him to enter into this Agreement except as expressly set
forth herein; that this Agreement is executed without reliance upon any
statements or representations made by either party or its or his attorneys or
representatives to the other concerning the nature and extent of any claims
or damages or legal liability therefor; that this Agreement evidences the
entire settlement of the claims released herein; and the Executive warrants
that he is competent and authorized to enter into this Agreement and that
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this Agreement is executed by the Executive with full knowledge and
understanding of its contents.
(C) Applicable Withholding. Any payments or
benefits to be provided to the Executive, Grace D. Steuri, or any person or
entity claiming through the Executive, in accordance with this Agreement or
otherwise shall be subject to any applicable withholding required under
federal, state or local law and any additional withholding to which the
Executive has agreed. No Releasee shall be responsible for any tax imposed
upon the Executive, Grace D. Steuri, or other person or entity with respect
to any such payment.
7. NO REEMPLOYMENT. The Corporation does not
intend to reinstate the Executive to employment by the Corporation or any of
its subsidiaries at any time in the future, and the Executive does not intend
to seek such reinstatement at any time in the future. The Corporation and
its subsidiaries shall have no obligation to consider the Executive for
re-employment at any time hereafter.
8. SPECIFIC PERFORMANCE; OTHER REMEDIES.
(A) In General. The Executive acknowledges that
the covenants contained in Section 4 of this Agreement are reasonably
necessary to protect the trade secrets, confidential information and other
business interests of the Corporation and its subsidiaries and affiliates and
that the Executive's compliance with those covenants is necessary to protect
them from unfair competition and competitive injury. The Executive further
recognizes that a breach of any of those covenants will result in irreparable
and continuing harm and damage to the Corporation and its parent,
subsidiaries and affiliates, for which there will be no adequate remedy at
law. The Executive therefore agrees that in the event of a breach of any of
the covenants in Section 4 of this Agreement, the Corporation and its
subsidiaries and affiliates shall be entitled to injunctive relief and to
such other relief (whether at law or in equity) as a court of competent
jurisdiction deems proper in the circumstances, in addition to any other
remedy or relief to which any of them may be entitled.
(B) In Particular. The obligations of the
Corporation under paragraphs (A) and (B) of Section 3 of this Agreement are
conditioned upon the Executive's compliance with the covenants made by him
under paragraphs (C) and (E) of Section 4 of this Agreement, and in the event
the Executive fails to comply with any of those covenants and the Corporation
obtains a ruling to that effect from a court of competent jurisdiction, the
Corporation thereupon shall be excused from making any further payment
required under paragraphs (A) and (B) of Section 3 of this Agreement. The
Executive acknowledges that the foregoing forfeiture of payments and benefits
under this Agreement is reasonable in relation to the harm that the
Corporation would sustain if the Executive were to violate any of the
covenants contained in paragraphs (C) and (E) of Section 4 of this Agreement
in any material respect.
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9. NON-ASSIGNMENT. Any rights to payments or
benefits under this Agreement payable to or with respect to the Executive or
Grace D. Steuri may not be assigned, voluntarily or involuntarily, and any
attempt to do so shall be void. The Executive warrants and represents that
he has not assigned or attempted to assign to any third party any claim, or
any part thereof, that he may have or claim to have against the Releasees.
10. BINDING EFFECT.
(A) Parties. This Agreement shall inure to the
benefit of and be binding upon the Corporation. This Agreement shall inure
to the benefit of each of the Releasees. This Agreement shall inure to the
benefit of and be binding upon the Executive and his spouse, Grace D. Steuri,
and their respective personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees, legatees and any
other person or entity claiming through the Executive. If the Executive
shall die while any amount would be payable to the Executive hereunder (other
than amounts which, by their terms, terminate upon the death of the
Executive) if the Executive had continued to live, unless otherwise provided
herein, the amount(s) shall be paid in accordance with the terms of this
Agreement to the executors, personal representatives or administrators of the
Executive's estate.
(B) Enforcement Costs and Expenses. In the event
of any action or proceeding between the parties concerning an alleged breach
of or default under this Agreement, the prevailing party shall be entitled to
collect from the other party all of the prevailing party's reasonable costs
and expenses (including, without limitation, attorneys fees) incurred by the
prevailing in connection therewith.
11. NOTICES. Notices and all other
communications provided for in this Agreement shall be in writing and shall
be deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed to the
respective addresses set forth below, or to such other address as either
party may have furnished to the other in writing in accordance herewith,
except that notice of change of address shall be effective only upon actual
receipt:
To the Corporation: To the Executive:
ALLTEL Corporation Mr. John E. Steuri
One Allied Drive 52 River Ridge Road
Little Rock, Arkansas 72202 Little Rock, AR 72227-1518
Attention: Chief Legal Officer
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12. MISCELLANEOUS. No provision of this
Agreement may be modified, waived or discharged unless such waiver,
modification or discharge is agreed to in writing and signed by the Executive
and the Chief Executive Officer of the Corporation. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed
by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof have been made by either party which are
not expressly set forth in this Agreement. The validity, interpretation,
construction and performance of this Agreement shall be governed by the laws
of the State of Arkansas.
13. CONSTRUCTION. The provisions of this
Agreement have been mutually created with the assistance of counsel for each
party, and no provision of this Agreement shall be construed against either
the Corporation or the Executive as the drafter thereof. Paragraph and
Section titles herein are for ease of reference purposes only and shall not
be considered in the construction of this Agreement.
14. VALIDITY. The invalidity or unenforceability
of any provision of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain
in full force and effect. If any part of the Agreement is found to be
unenforceable the other provisions shall remain fully valid and enforceable.
In the event any provision of this Agreement is held unenforceable, such
provision shall be reformed so as to be enforced to the maximum extent
possible, and if a court determines that it is not possible to reform any
such provision of this Agreement, such provision will be severed from the
Agreement and the remainder of the Agreement shall be enforced to the full
extent permitted by law.
15. COUNTERPARTS. This Agreement may be executed
in several counterparts, each of which shall be deemed to be an original but
both of which together will constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have signed this
Agreement as of the date set forth above.
Attest: ALLTEL CORPORATION
By: /s/ Francis X. Frantz By: /s/ Joe Ford
Francis X. Frantz Name: Joe T. Ford
Secretary Title: Chairman, President,
and Chief Executive Officer
ALLTEL INFORMATION SERVICES, INC.
By: /s/ William L. Cravens
Name: William L. Cravens
Title:Vice Chairman and COO
ALLTEL FINANCIAL INFORMATION
SERVICES, INC.
By: /s/ William L. Cravens
Name: William L. Cravens
Title:Vice Chariman and COO
Witness:
/s/ Francis X. Frantz /s/ John Steuri
John E. Steuri
The undersigned, Grace D. Steuri, hereby consents to the provisions of this
Agreement and (i) accepts and agrees to be bound by the provisions of Section
3 of this Agreement, (ii) joins in and agrees to be bound by the provisions of
paragraphs (D) and (E) of Section 4 of this Agreement, (iii) agrees to be
bound by the provisions of Section 5 of this Agreement, (iv) makes the
warranties contained in paragraph (B) of Section 6, and the second sentence
of Section 9 of this Agreement, as though she were "the Executive" as that
term is used therein and (v) agrees to be bound by the provisions of Section
6 and Sections 8 through 15 of this Agreement.
Witness:
/s/ Francis X. Frantz /s/ Grace D. Steuri
Francis X. Frantz Grace D. Steuri
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Exhibit 10(k)(3)
AMENDMENT NO. 4
TO
ALLTEL CORPORATION PENSION PLAN
(January 1, 1994 Restatement)
WHEREAS, ALLTEL Corporation (the "Company") maintains the ALLTEL
Corporation Pension Plan, as amended and restated effective January 1, 1994,
and subsequently further amended, (the "Plan"); and
WHEREAS, the Company desires further to amend the Plan;
NOW THEREFORE, BE IT RESOLVED, that the Company hereby amends the
Plan in the respects hereinafter set forth.
1. Effective as of the Effective Date, as Effective Date is defined
in the Employee Transfer Agreement between Citizens Utilities Company of
Pennsylvania, a Pennsylvania corporation, and Tuolumne Telephone Company,
dated as of November 28, 1994, (the "Transfer Agreement"), but contingent upon
consummation (as determined by the Company and communicated in writing to the
Committee) of the transactions contemplated by the Employee Transfer Agreement,
the Plan is amended by adding immediately following Section 13.21 thereof, a
new Section 13.22 to provide as follows:
13.22 Employees of Citizens Utilities Company of Pennsylvania
(a) Effective Date - The Effective Date, as defined in Appendix W.
(b) Account - None.
(c) Minimum Normal Retirement Pension - None.
(d) Minimum Early Retirement Pension - None.
(e) Minimum Disability Retirement Pension - None.
(f) Minimum Deferred Vested Pension - None.
(g) Minimum Death Benefit - None.
(h) Prior Plan Offset - None.
(i) Provision Relative to Section 401(a)(12) of the Code -
Notwithstanding any other provision of this Plan, in the event
of the termination of the Plan, each participant of the Plan
who has a benefit under the Plan attributable to the Former
Plan shall receive a benefit
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which is equal to or greater than the benefit he would have
been entitled to receive if the Former Plan had terminated
immediately prior to the Effective Date.
(j) Miscellaneous - See APPENDIX W - SPECIAL PROVISIONS APPLICABLE
TO CERTAIN FORMER EMPLOYEES OF CITIZENS UTILITIES COMPANY OF
PENNSYLVANIA, which appendix follows immediately hereafter.
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APPENDIX W
SPECIAL PROVISIONS APPLICABLE TO CERTAIN FORMER EMPLOYEES
OF
CITIZENS UTILITIES COMPANY OF PENNSYLVANIA
Pursuant to an Employee Transfer Agreement between Citizens Utilities
Company of Pennsylvania, a Pennsylvania corporation, and Tuolumne
Telephone Company, dated November 28, 1994, (the "Transfer Agreement"),
certain employees of Citizens Utilities Company of Pennsylvania who are
not covered by a collective bargaining agreement and whose employment
transferred to Tuolumne Telephone Company became Employees (the
"Transfer Employees"). Effective as of the "Effective Date," as
Effective Date is defined in the Employee Transfer Agreement, assets and
liabilities with respect to the Transfer Employees shall be transferred
to the Plan from the Former Plan. Thereafter, the provisions of the
Plan shall govern the interests of participants, former participants,
contingent annuitants or any other person or entity claiming any right
or interest under the Former Plan with respect to the Transfer Employees.
Notwithstanding any other provision of the Plan, the Plan is modified as
set forth below with respect to the Transfer Employees.
A. Section 1.01 is modified as follows:
1.01W "Accrued Pension" for a Participant means (except as otherwise
provided herein) an amount equal to the sum of (1) and (2)
below:
(1) an amount equal to the Participant's Accrued Pension under
Section 1.01 without regard to this subsection 1.01W.
plus
(2) An amount equal to the Participant's monthly accrued
benefit that has accrued at the close of business on the
Effective Date under the Former Plan (the "Citizens
Benefit"), if any.
B. Section 1.03 is modified as follows:
1.03W "Actuarial Equivalent" with respect to any determination of
actuarial equivalence required by the provisions of the Plan
involving the Citizens Benefit shall be made using the
following actuarial assumptions:
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(a) Lump Sum Distributions
(1) Mortality: UP-1984 Mortality Table with a 3 year
setback for contingent annuitants.
(2) Interest: The PBGC Interest Rate.
(3) Minimum Actuarial Equivalent Present Value - The
minimum Actuarial Equivalent present value for an
employee with 20 or more years of Vesting
Service who was a participant in the Former Plan on
December 31, 1983, shall be based on:
(A) Mortality: 1971 GAM Table for Males.
(B) Interest: 6%.
(b) Annuity Conversion Factors
(1) Mortality: 83 GAM Table for Males with a 3 year
setback for contingent annuitants.
(2) Interest: 8%.
C. Section 1.24 is modified as follows:
1.24W "Normal Retirement Age" means age 65.
D. Section 1.37(d) is modified as follows:
1.37(d)W Benefit Service
(1) The amount of the benefit payable to or on behalf of a
Participant shall be determined on the basis of his Benefit
Service, in accordance with the following:
(i) Benefit Service Prior to the Effective Date: None.
(ii) Benefit Service for the Calendar Year in Which the
Effective Date Occurs: For the calendar year in which
the Effective Date occurs, the Participant shall
accrue one-twelfth (1/12th) year of Benefit Service
with respect to benefits under the Plan other
than a Participant's Citizens Benefit for each one
hundred sixty-six and two-thirds (166 2/3) Hours of
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Service completed (during such calendar year).
(iii) Benefit Service for Calendar Years Beginning After
the Effective Date: For calendar years beginning after
the Effective Date, Benefit Service with respect to
benefits under the Plan other than a Participant's
Citizens Benefit shall be determined in accordance
with Section 1.37(d), except that the last sentence of
Section 1.37(d)(l)(ii) shall not result in any
duplication of Benefit Service for the Calendar
Year in which the Effective Date occurs.
E. Section 1.37(f) is modified as follows:
1.37(f)W Eligibility Year of Service
Subject to the Break in Service provisions, an Employee, whether
or not a Participant, shall accrue Eligibility Years of Service
under the Plan in accordance with Section 1.37(f), but taking
into account his period(s) of employment taken into account
under the Former Plan as if such period(s) of employment had
been with the Controlled Group. Notwithstanding any other
provision of Section 1.37(f) or this Section 1.37(f)W, an
Employee shall not be credited with less Eligibility Years of
Service for service taken into account as eligibility service
under the Former Plan than under the method for determining
eligibility service under the Former Plan.
F. Section 1.37(g) is modified as follows:
1.37(g)W Vesting Service
(1) A Participant's eligibility for benefits under the Plan
shall be determined by his period of Vesting Service, in
accordance with the following:
(i) Service Prior to the Effective Date: For a Participant
as of the Effective Date, the Participant's period(s)
of employment taken into account under the Former
Plan as of the Effective Date, shall be counted
as Vesting Service to the extent of the number of
whole 1-year periods of service that were
similarly credited under the provisions of the Former
Plan as of the Effective Date.
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(ii) Service From and After the Effective Date: Subject to
the Break in Service provisions, an Employee, whether
or not a Participant, shall accrue one year of
Vesting Service for each calendar year in which he has
1,000 or more Hours of Service. For all purposes
except for determining eligibility for Early
Retirement Pension under Section 10.02 or Disability
Retirement Pension under Section 10.03, in determining
such Vesting Service for the computation period which
includes the Effective Date, the Participant shall
receive credit for a number of Hours of Service
with respect to any fractional part of a year of
service credited to the Participant as of the
Effective Date under the provisions of the Former
Plan, determined by crediting the Participant with
190 Hours of Service for each 1/12th of a fractional
year of service. Only for purposes of determining
eligibility for Early Retirement Pension under
Section 10.02 and Disability Retirement Pension
under Section 10.03, in determining such Vesting
Service for the computation period in which the
Participant has a Termination of Employment,
the Participant shall receive credit for a number of
Hours of Service with respect to any fractional part
of a year of service credited to the Participant as
of the Effective Date under the provisions of the
Former Plan, determined by crediting the Participant
with 190 Hours of Service for each 1/12th of a
fractional year of service.
(iii) Notwithstanding the provisions of part (ii), a
Participant shall not be credited with less years of
Vesting Service for service from and after the
Effective Date than under the method for determining
vesting service under the Former Plan.
(iv) Notwithstanding any other provision of the Plan,
there shall be no duplication of Vesting Service or
Vesting Years of Service under the Plan and the
Former Plan by reason of any restoration of, crediting
of, or granting of service (or hours of service) in
respect of any single period or otherwise.
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G. Section 1.43 is modified to provide as follows:
1.43W "Total and Permanent Disability" means the total disability by
bodily or mental injury or disease of an Employee as determined
by the Plan Administrator after consultation with a qualified
physician selected by the Plan Administrator provided:
(a) the Employee has the equivalent of five Vesting Years of
Service;
(b) The Employee has become disabled by bodily injury, disease,
mental derangement or other cause of incapacity so
as to be prevented thereby from performing any substantial
gainful activity and which can be expected to result in
death or have lasted or can be expected to last for a
continuous period of not less than twelve months;
(c) such disability shall have existed for a period of six
consecutive calendar months; and
(d) such disability did not arise out of criminal activities
on the part of the Participant, or did not arise out of the
illegal use of drugs, or did not arise from an
intentionally self-inflicted injury, or did not arise from
service in any branch of the Armed Forces, of any nation or
from service in any police or other armed branch
or department of any nation, state, or political
subdivision thereof.
H. Section 1.48 is added as follows:
1.48W "Former Plan" means the Citizens Pension Plan, as in effect on
the Effective Date.
I. Section 1.53 is added to provide as follows:
1.53W "Annuity Starting Date" means, with respect to a Citizens
Benefit, the earliest of:
(a) the last day of the month coincident with or following the
day of the Participant's Retirement on or after his
Normal Retirement Date,
(b) the last day of the month coincident with or following the
Participant's Termination of Employment if Section 11.06
applies,
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(c) the last day of the month coincident with or following the
Participant's Normal Retirement Date if the Participant has
a Termination of Employment prior to that time except that
the Annuity Starting Date of a Participant who elects
under Section 10.02W or 10.04W to commence to receive a
distribution prior to his Normal Retirement Date shall be
the date elected under Section 10.02W or 10.04W,
(d) in the case of a Participant who remains employed after his
Normal Retirement Date, the last day of any month
following his Normal Retirement Date if he elects to have
distribution commence before his Retirement after his
Normal Retirement Date, and
(e) in the case of a Participant whose benefits must commence
pursuant to subsection (b) of Section 11.10, the
April 1 following the calendar year in which the
Participant attains age 70 1/2.
J. Section 10.01 is modified as follows:
10.01W Normal Retirement Pension
(a) A Participant whose Retirement occurs on or after his
Normal Retirement Date shall be eligible for a Normal
Retirement Pension in an amount equal to his Accrued
Pension, as determined under Section 1.01, at Retirement.
(b) A Participant who remains in employment after his Normal
Retirement Date (other than a Rehired Employee, as defined
in Section 11.09W) may elect to commence benefits with
respect to his Citizens Benefit in accordance with
subsection (b) of Section 11.01W or Section 11.05W,
subject to Section 11.04. If a Participant makes such an
election, he shall be entitled to elect another form of
distribution upon his Retirement, subject to Section 11.04.
K. Section 10.02(c) is modified as follows:
10.02(c)W Early Retirement Pension
A Participant with 5 or more Vesting Years of Service whose
Retirement occurs on or after the date he reaches age 55 but
prior to his attainment of age 65 shall be eligible for an
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Early Retirement Pension with respect to his Citizens Benefit.
The monthly Pension of a Participant eligible for an Early
Retirement Pension with respect to his Citizens Benefit as
provided under this subsection (c) shall be, at the option of
the Participant, either (1) or (2) as set forth below:
(1) A deferred pension commencing as of the Participant's
Normal Retirement Date in an amount equal to his Accrued
Pension attributable to his Citizens Benefit at the
time of Early Retirement.
(2) An immediate pension determined as provided in (1) above,
commencing as of the last day of the month in which such
Participant retired early or any later month elected by the
Participant and subsequent to his having made written
application therefor, but reduced by five-twelfths of one
percent for each full month, if any, by which distribution
of his Early Retirement Benefit precedes his attainment of
Normal Retirement Date.
If a Participant elects commencement of his Citizens Benefit
under this subsection (c), the Participant's Accrued Pension
shall be calculated without regard to such Citizens Benefit.
L. Section 10.03 is modified as follows:
10.03W Disability Retirement Pension
(a) A Participant who has 5 or more Vesting Years of Service
who has a Termination of Employment due to his Total
and Permanent Disability prior to the attainment of age 65
shall be entitled to a Disability Retirement Pension with
respect to his Citizens Benefit until the earlier
of (1) the earlier of (i) the death of such retired
Participant or (ii) the retired Participant's recovery from
his Total and Permanent Disability, or (2) the retired
Participant begins to receive an Early Retirement Pension
or Normal Retirement Pension. The monthly Pension of a
Participant eligible for a Disability Retirement Pension
with respect to his Citizens Benefit shall be equal to the
greater of (i) his "Accrued Normal Retirement Benefit" with
respect to his Citizens Benefit, as defined below, or (ii)
70 percent of his "Projected Normal Retirement Benefit"
with respect to his Citizens Benefit, as defined below.
(b) A Participant's "Accrued Normal Retirement Benefit" with
respect to his Citizens Benefit means an amount determined
by multiplying his Projected Normal
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Retirement Benefit by a fraction the numerator of which is
the benefit service with which he was credited under the
Former Plan without regard to the 35-year limitation on
such service and the denominator of which is the projected
benefit service with which he would have been credited
under the Former Plan if he had had a Severance from
Service Date, as defined in the Former Plan as in effect on
the Effective Date, on his Normal Retirement Date.
(c) A Participant's "Projected Normal Retirement Benefit" with
respect to his Citizens Benefit means an amount determined
under the benefit formula under the Former Plan as in
effect on the Effective Date, using the Participant's
"Average Compensation" and "Average Covered Compensation,"
both as defined under the Former Plan as in effect on the
Effective Date, determined under the Former Plan as
of the Effective Date, but projecting the benefit service
with which he would have been credited under the Former
Plan if he had had a Severance from Service Date, as
defined in the Former Plan as in effect on the Effective
Date, on his Normal Retirement Date, but not in excess of
35 years.
(d) Notwithstanding the foregoing, a Participant's Disability
Retirement Pension shall not exceed an amount equal to the
"qualified disability benefit," as defined in Section 3(22)
of the Act.
(e) Payment of the Participant's Disability Retirement Pension
with respect to his Citizens Benefit shall commence upon
the last day of the month after the Plan Administrator
determines that the Participant has incurred a Permanent
Disability, but not earlier than the last day of the month
in which the Participant attains age 55.
M. Section 10.04 is modified as follows:
10.04W Deferred Vested Pension Upon Termination of Employment
(d) Except as provided in this Section 10.04(d)W, the Vesting
Years of Service of a Participant who is reemployed
after a Break in Service shall be determined under
subsection (d) of Section 10.04. If a former Employee or
former Participant who had a Break in Service and who did
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not have a vested right to an Accrued Pension is reemployed
after the Effective Date, he shall be credited, for
purposes of vesting with respect to his Citizens Benefit,
with his pre-Break Vesting Years of Service only if his
consecutive one-year Breaks in Service are less than the
greater of 5 years or the aggregate number of his pre-Break
Vesting Years of Service and he is credited with a Vesting
Year of Service after his Break in Service.
(g) (i) A former Participant who has at least 5 years of
Vesting Service but who is not eligible for a Normal
Retirement Pension, an Early Retirement Pension, or a
Disability Pension shall be entitled to a Deferred
Vested Pension with respect to his Citizens Benefit.
The monthly Pension of a former Participant eligible
for a Deferred Vested Pension with respect to his
Citizens Benefit shall be equal to his Accrued
Pension attributable to his Citizens Benefit. The
Deferred Vested Pension of a former Participant shall
commence as of his Normal Retirement Date, except that
a former Participant who has attained age 55 may elect
to commence as of the last day of any month following
his election to commence prior to his Normal
Retirement Date.
(ii) If a Participant elects commencement of his Citizens
Benefit under this Section 10.04W, the Participant's
Accrued Pension shall be calculated without regard to
his Citizens Benefit.
N. Section 11.01(b) is modified as follows:
11.01(b)W Normal and Early Retirement Pensions
(i) The normal form of benefit for a married Participant is a
Qualified Joint and Survivor Annuity with the Spouse as
Beneficiary as provided in Section 11.04. The normal form
of benefit for all other Participants shall be a single
life annuity. An optional form of benefit payment may be
elected pursuant to Section 11.05W.
(ii) In the case of a married Participant who participated in
the Citizens Utilities Company Plan on December 31, 1975, a
Qualified Joint and Survivor Annuity shall have the meaning
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set forth in Section 1.33, except that if the Participant's
death should occur before a total of 120 monthly payments
have been made, then (i) the amount of the survivor
pension shall be 100% of the reduced pension payable to the
Participant, until a total of 120 monthly payments have
been made, and shall thereafter be 50% of the reduced
pension, and (ii) the survivor annuity shall be payable
until a total of 120 monthly payments have been made
without regard to whether or not the Spouse is living. Any
such survivor annuity payable after the death of the
Spouse shall be payable to the Beneficiary. In the case of
any Participant who participated in the Citizens Utilities
Company on December 31, 1975 who is not married, the normal
form of benefit is an annuity payable for the life
of the Participant, or, if longer, until 120 monthly
payments have been made.
O. Section 11.05(g) is modified as follows:
11.05(g)W Optional Forms of Pension
A Participant may elect to receive his Citizens Benefit in one
of the following forms of payment, which shall be the
Actuarial Equivalent of a life annuity payable for the life of
the Participant. The provisions of subsection (c) of
Section 11.04 shall not apply with respect to a Participant's
Citizens Benefit.
A Participant may waive the normal form of payment applicable to
him and elect one of the following optional forms of payment
with respect only to his Citizens Benefit.
(1) Life Annuity - an annuity for the life of the Participant.
(2) Life Annuity with a five year certain feature - a reduced
annuity for the life of the Participant, but if the
Participant dies within five years of his Annuity Starting
Date, the annuity is payable to the Participant's
Beneficiary for the remainder of the five-year period;
(3) Life Annuity with a ten year certain feature - a reduced
annuity for the life of the Participant, but if the
Participant dies within ten years of his Annuity Starting
Date, the annuity is payable to the Participant's
Beneficiary for the remainder of the ten-year period;
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(4) Joint and 100% Survivor Annuity - a reduced annuity for the
life of the Participant with a survivor annuity for the
life of the Participant's Beneficiary, where the survivor
annuity is 100% of the amount payable during the joint
lives of the Participant and the Participant's Beneficiary;
(5) Joint and 66 2/3% Survivor Annuity - a reduced annuity for
the life of the Participant with a survivor annuity for
the life of the Participant's Beneficiary, where the
survivor annuity is 66 2/3% of the amount payable during
the joint lives of the Participant and the Participant's
Beneficiary;
(6) Joint and 50% Survivor Annuity - a reduced annuity for the
life of the Participant with a survivor annuity for the
life of the Participant's Beneficiary, where the survivor
annuity is 50% of the amount payable during the joint lives
of the Participant and the Participant's Beneficiary;
(7) Joint and 33 1/3% Survivor Annuity - a reduced annuity for
the life of the Participant with a survivor annuity for
the life of the Participant's Beneficiary, where the
survivor annuity is 33 1/3% of the amount payable during
the joint lives of the Participant and the Participant's
Beneficiary;
(8) Lump Sum distribution of the full amount payable - the
Actuarial Equivalent present value of the Participant's
vested interest payable at his or her Annuity Starting
Date.
Notwithstanding the foregoing, a Participant whose Citizens
Benefit commences as of the same time as his Accrued Pension
(other than his Citizens Benefit) may elect to receive his
entire benefit in any form permitted and under the conditions
and actuarial equivalence provisions of the Plan (other than
this Appendix W).
P. Section 11.09 is modified as follows:
11.09W Suspension of Benefits Upon Reemployment.
(a) Section 11.09 shall apply with respect to a Participant's
retirement benefits other than retirement benefits
attributable to his Citizens Benefit.
(b) Section 11.09 shall apply with respect to a Participant's
retirement benefits attributable to his Citizens
Benefit if he becomes a "Rehired Employee," as hereinafter
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defined, after his Annuity Starting Date. A "Rehired
Employee" means an Employee who is rehired by a member of
the Controlled Group after he has had a Retirement on or
after his Normal Retirement Date or a Termination of
Employment, other than as a result of his Total and
Permanent Disability. When payment resumes following the
Rehired Participant's subsequent Retirement or Termination
of Employment, payment shall be in the same form as before
the suspension. In no event shall the Participant's
retirement benefits attributable to his Citizens Benefit
under this Section 11.09W be less than the Participant's
retirement benefits attributable to his Citizens
Benefit before he resumed employment with a member of the
Controlled Group.
Q. Section 11.11 is modified as follows:
11.11W Suspension of Benefits Upon Reemployment
(a) Section 11.11 shall apply with respect to a Participant's
retirement benefits other than retirement benefits
attributable to his Citizens Benefit.
(b) Section 11.11 shall apply with respect to a Participant's
retirement benefits attributable to his Citizens Benefits
if he becomes a "Rehired Employee," as defined in
Section 11.09W, after his Annuity Starting Date.
R. Section 11.12 is modified as follows:
11.12W Benefit Accruals While Receiving Benefit Payments
(a) Notwithstanding any other provision of the Plan to the
contrary except subsection (b) of this Section 11.12W, in
the case of a Participant whose monthly Pension commences
in accordance with subsection (b) of Section 11.10 by
reason of his having attained age 70-1/2, any increase in
the monthly amount of his Normal Retirement Benefit
determined as provided in Section 10.01 with respect to
any Plan Year which would otherwise occur shall be reduced
(but not below zero) by the Actuarial Equivalent of total
Plan benefit payments made to such Participant during
such Plan Year.
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(b) Subsection (a) of this Section 11.12W shall not apply with
respect to retirement benefits attributable to the
Citizens Benefit of a Participant who elects commencement
of his retirement benefits attributable to his Citizens
Benefit in accordance with subsection (b) of Section
10.01W.
S. Section 12.01 is modified as follows:
12.01W Death Prior to Pension Commencement
For purposes of Section 12.01 with respect to a Participant's
Accrued Pension other than his Citizens Benefit, the "Earliest
Retirement Date" of a Participant who dies is the later of the
month following the month in which the Participant dies or the
month in which the Participant would have first become eligible
for commencement of a Pension under the Plan if he had survived.
For purposes of Section 12.01 with respect to a Participant's
Accrued Pension attributable to his Citizens Benefit, the
"Earliest Retirement Date" of a Participant who dies is the
later of the last day of the month coincident with or following
the Participant's death or the last day of the month on which
the Participant would have first become eligible for
commencement of a Pension under the Plan if he had survived.
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2. Effective as of May 30, 1995, Section 13 of the Plan
is amended by adding the following Section 13.23
thereto:
13.23 Employees of Vertex Business Systems, Inc.
(a) Effective Date - May 30, 1995.
(b) Account - None.
(c) Minimum Normal Retirement Pension - None.
(d) Minimum Early Retirement Pension - None.
(e) Minimum Disability Retirement Pension - None.
(f) Minimum Deferred Vested Pension - None.
(g) Minimum Death Benefit - None.
(h) Prior Plan Offset - Not Applicable.
(i) Provision Relative to Section 401(a)(12) of the Code - Not
Applicable.
(j) Miscellaneous - See APPENDIX X - SPECIAL PROVISIONS APPLICABLE
TO CERTAIN EMPLOYEES OF VERTEX BUSINESS SYSTEMS, INC., which
follows immediately hereafter.
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APPENDIX X
SPECIAL PROVISIONS APPLICABLE TO CERTAIN EMPLOYEES
OF
VERTEX BUSINESS SYSTEMS, INC.
Effective as of May 30, 1995, certain employees of Vertex Business
Systems, Inc. ("Vertex") became employees of the Controlled Group.
Notwithstanding any other provision of the Plan, the Plan is modified as
set forth below with respect to active employees of Vertex who became
employees of the Controlled Group on May 30, 1995.
A. Section 1.07 is modified by adding to the definition thereof the
following:
1.07X "Basic Compensation" shall include only amounts earned (as an
Employee of an Employer) after May 30, 1995.
B. Section 1.14 is modified by adding to the definition thereof the
following:
1.14X "Compensation" shall include only amounts earned (as an Employee
of an Employer) after May 30, 1995.
C. Section 1.37(g) is modified as follows:
1.37(g)X Vesting Service
(a) A Participant's eligibility for benefits under the Plan
shall be determined by his period of Vesting Service, in
accordance with the following:
(i) Service Prior to May 31, 1995: An Employee's
period(s) of employment with Vertex after
May 30, 1990, and prior to May 31, 1995, shall be
counted as Vesting Service to the extent that such
periods would have counted under the Plan if
such employment had been with the Company.
(ii) Service From and After May 31, 1995: In accordance
with the provisions of Section 1.37(g).
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D. Section 1.37(d) is modified as follows:
1.37(d)X Benefit Service
(a) The amount of the benefit payable to or on behalf of a
Participant shall be determined on the basis of his Benefit
Service, in accordance with the following:
(i) Benefit Service Prior to May 31, 1995: None.
(ii) Benefit Service From and After May 31, 1995: In
accordance with the provisions of Section 1.37(d).
E. Section 1.37(f) is modified as follows:
1.37(f)X Eligibility Year of Service
(a) A Participant's Eligibility Years of Service under the
Plan shall be determined in accordance with the following:
(i) Service Prior to May 31, 1995: An Employee's period(s)
of employment with Vertex after May 30, 1990, and
prior to May 31, 1995, shall be counted as Eligibility
Years of Service to the extent that such periods
would have counted under the Plan if such employment
had been with the Company.
(ii) Service From and After May 31, 1995: In accordance
with the provisions of Section 1.37(f).
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3. Effective as of August 31, 1995, Section 13 of
the Plan is amended by adding the following
Section 13.24 thereto:
13.24 Employees of BellSouth Mobility Inc.
(a) Effective Date - August 31, 1995.
(b) Account - None.
(c) Minimum Normal Retirement Pension - None.
(d) Minimum Early Retirement Pension - None.
(e) Minimum Disability Retirement Pension - None.
(f) Minimum Deferred Vested Pension - None.
(g) Minimum Death Benefit - None.
(h) Prior Plan Offset - Not Applicable.
(i) Provision Relative to Section 401(a)(12) of the Code - Not
Applicable.
(j) Miscellaneous - See APPENDIX Y - SPECIAL PROVISIONS APPLICABLE TO
CERTAIN EMPLOYEES OF BELLSOUTH MOBILITY INC., which follows
immediately hereafter.
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APPENDIX Y
SPECIAL PROVISIONS APPLICABLE TO CERTAIN EMPLOYEES
OF
BELLSOUTH MOBILITY INC.
Effective as of August 31, 1995, certain employees of BellSouth Mobility
Inc. ("BellSouth") became employees of the Controlled Group.
Notwithstanding any other provision of the Plan, the Plan is modified as
set forth below with respect to active employees of BellSouth who became
employees of the Controlled Group on August 31, 1995.
A. Section 1.07 is modified by adding to the definition thereof the
following:
1.07Y "Basic Compensation" shall include only amounts earned after
August 31, 1995.
B. Section 1.14 is modified by adding to the definition thereof the
following:
1.14Y "Compensation" shall include only amounts earned after
August 31, 1995.
C. Section 1.37(g) is modified as follows:
1.37(g)Y Vesting Service
(a) A Participant's eligibility for benefits under the Plan
shall be determined by his period of Vesting Service, in
accordance with the following:
(i) Service Prior to September 1, 1995: An Employee's
period(s) of employment with BellSouth prior to
September 1, 1995, shall be counted as Vesting
Service to the extent that such periods would have
counted under the Plan if such employment had
been with the Company.
(ii) Service From and After September 1, 1995: In
accordance with the provisions of Section 1.37(g).
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D. Section 1.37(d) is modified as follows:
1.37(d)Y Benefit Service
(a) The amount of the benefit payable to or on behalf of a
Participant shall be determined on the basis of his Benefit
Service, in accordance with the following:
(i) Benefit Service Prior to September 1, 1995: None.
(ii) Benefit Service From and After September 1, 1995: In
accordance with the provisions of Section 1.37(d).
E. Section 1.37(f) is modified as follows:
1.37(f)Y Eligibility Year of Service
(a) A Participant's Eligibility Years of Service under the Plan
shall be determined in accordance with the following:
(i) Service Prior to September 1, 1995: An Employee's
period(s) of employment with BellSouth prior to
September 1, 1995, shall be counted as Eligibility
Years of Service to the extent that such periods
would have counted under the Plan if such employment
had been with the Company.
(ii) Service From and After September 1, 1995: In
accordance with the provisions of Section 1.37(f).
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4. Effective as if set forth in the January 1, 1994 Restatement
when originally executed, subsection (h) of Section 1.37 is
amended by deleting the reference to "Section 11.04" therefrom
and substituting a reference to "Section 10.04" therefor.
5. Effective as if set forth in the January 1, 1994 Restatement
when originally executed, subsection (b) of Section 10.04 is
amended by deleting the word "Date" therefrom and substituting
the word "Age" therefor.
6. Effective as if set forth in the January 1, 1994 Restatement
when originally executed, Section 13.08 is amended by deleting
the date "December 31, 1996" therefrom and substituting the
date "December 31, 1986" therefor.
7. Effective as if set forth in the January 1, 1994 Restatement
when originally executed, Section 13.21 is amended by deleting
the words "SLT COMMUNICATIONS, INC. AND ITS SUBSIDIARIES"
therefrom and substituting the words "TDS HEALTHCARE SYSTEMS
CORPORATION AND/OR ITS SUBSIDIARIES" therefor.
8. Effective as of the date of execution hereof, the first sentence
of Section 3.04 is amended to provide as follows:
If any person to whom a benefit under the Plan is payable is unable to
care for his affairs because of illness or accident or legal incompetence,
any payment due may be paid, in the discretion of the Plan Administrator,
to the Spouse, child, brother or sister of such person, or to any other
persons deemed by the Plan Administrator to be maintaining or responsible
for the maintenance of such person (unless prior claim therefor shall have
been made by a duly qualified guardian or other legal representative).
IN WITNESS WHEREOF, the Company, by its duly authorized officer,
has caused this Amendment to be executed on this 27th day of October, 1995.
ALLTEL CORPORATION
By: /s/ John L. Comparin
Title: V.P. - Human Resources
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AMENDMENT NO. 5
TO
ALLTEL CORPORATION PENSION PLAN
(January 1, 1994 Restatement)
WHEREAS, ALLTEL Corporation (the "Company") maintains the ALLTEL
Corporation Pension Plan, as amended and restated effective January 1, 1994,
and subsequently further amended, (the "Plan"); and
WHEREAS, the Company desires further to amend the Plan;
NOW THEREFORE, BE IT RESOLVED, that the Company hereby amends the
Plan in the respects hereinafter set forth.
Effective as of the close of business on December 31, 1995,
Section 13.17 of the Plan is amended to provide as follows:
13.17 Employees of Sugar Land Telephone Company, Perco Telephone Company,
SLT Cable TV, Inc., and Metropolitan Houston Paging Services, Inc.
(a) Effective Date - January 1, 1993, except as otherwise specified
in Appendix Q.
(b) Account - None.
(c) Minimum Normal Retirement Pension - None.
(d) Minimum Early Retirement Pension - None.
(e) Minimum Disability Retirement Pension - None.
(f) Minimum Deferred Vested Pension - None.
(g) Minimum Death Benefit - None.
(h) Prior Plan Offset - Not Applicable.
(i) Provision Relative to Section 401(a)(12) of the Code -
Notwithstanding any other provision of this Plan, in the event
of the termination of the Plan, each participant of the Plan
who has a benefit under the Plan attributable to the Former
Plan shall receive a benefit which is equal to or greater than
the benefit he would have been entitled to receive if the
Former Plan had terminated immediately prior to the close of
business on December 31, 1995.
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(j) Miscellaneous - See APPENDIX Q - SPECIAL PROVISIONS APPLICABLE
TO CERTAIN EMPLOYEES OF SUGAR LAND TELEPHONE COMPANY, PERCO
TELEPHONE COMPANY, SLT CABLE TV, INC., AND METROPOLITAN
HOUSTON PAGING SERVICES, INC., which follows immediately
hereafter.
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APPENDIX Q
SPECIAL PROVISIONS APPLICABLE TO CERTAIN EMPLOYEES
OF
SUGAR LAND TELEPHONE COMPANY, PERCO TELEPHONE COMPANY,
SLT CABLE TV, INC., AND
METROPOLITAN HOUSTON PAGING SERVICES, INC.
Pursuant to the merger of a subsidiary of ALLTEL Corporation into SLT
Communications, Inc. with SLT Communications, Inc. as the surviving
corporation, as defined in the Plan of Merger dated June 12, 1992
between ALLTEL Corporation and SLT Communications, Inc., as amended,
(the "Corporate Merger") certain employees of Sugar Land Telephone
Company, Perco Telephone Company, and SLT Cable TV, Inc. (collectively,
"SLT") and certain former employees of Metropolitan Houston Paging
Services, Inc. ("Metropolitan") whose employment transferred to SLT
Cable TV, Inc. became Employees. Effective as of the close of business
on December 31, 1995, the SLT Communications, Inc. Retirement Plan is
continued by amendment and merger into the Plan. On and after January
1, 1996, the provisions of the Plan shall govern the interests of
participants, former participants, beneficiaries, contingent annuitants
or any other person or entity claiming any right or interest under the
Former Plan.
Notwithstanding any other provision of the Plan, the Plan is modified as
set forth below with respect to active employees of SLT on the date of
the Corporate Merger and the employees of Metropolitan whose employment
transferred to SLT Cable TV, Inc. in connection with the Corporate
Merger who became Employees. For a Former Plan participant who died,
became "totally and permanently disabled" or who had a termination of
employment prior to January 1, 1996, the provisions of the Former Plan
in effect at the date of the participant's death, the date the
participant became totally and permanently disabled, or when the
participant had a termination of employment shall govern the rights and
interests of the participant, his beneficiaries and contingent
annuitants and any other person or entity claiming any right or interest
through the participant's participation in the Former Plan, except as
otherwise required by law, or if the Former Plan participant is
reemployed in employment of the Controlled Group on or after January 1, 1996,
in which case the Plan as modified as set forth below shall apply
to such Former Plan participant.
A. Section 1.01 is modified as follows:
1.01Q "Accrued Pension" for a Participant means (except as otherwise
provided herein) an amount equal to the sum of (1) and (2)
below:
(1) an amount equal to the Participant's Accrued Pension under
Section 1.01 without regard to this subsection 1.01Q.
plus
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(2) An amount equal to the Participant's monthly accrued
benefit under the terms of the Former Plan as in effect
as of the close of business on December 31, 1995, (the
"SLT Benefit"), if any. (Benefit accruals under the Former
Plan ceased effective as of the close of business on
December 31, 1992. The amount of such monthly accrued
benefit includes any applicable reduction for benefits
under certain other pension plans and any applicable
minimum benefit, as specified under the Former Plan.)
B. Section 1.03 is modified as follows:
1.03Q "Actuarial Equivalent" with respect to any determination of
actuarial equivalence required by the provisions of the Plan
involving the SLT Benefit shall be made using the following
actuarial assumptions:
(1) In General
Paragraphs (2) and (3) of this Section 1.03Q shall apply
to all lump sum distributions from the Plan with respect to
a Participant's SLT Benefit. Paragraph (4) of this
Section 1.03Q shall apply for all other purposes with
respect to a Participant's SLT Benefit.
(2) Determination of Present Value
(a) Actuarial equivalence for purposes of determining
whether the present value of (i) a Participant's
vested Accrued Pension; (ii) a qualified joint
and survivor annuity, within the meaning of section
417(b) of the Internal Revenue Code; or (iii) a
qualified preretirement survivor annuity within the
meaning of Section 417(c)(1) of the Internal Revenue
Code, each with respect to his SLT Benefit, exceeds
$3,500, the present value of such benefits or annuity
shall be calculated by using an interest rate no
greater than the PBGC Rate.
(b) In no event shall the present value of any such
benefit or annuity determined under this paragraph
(2) be less than the greater of:
(i) the present value of such benefits or annuities
determined using the Unisex Pension Mortality
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Table (UP-1984 Table) and 6% interest; or
(ii) the present value of such benefits or annuities
determined using the PBGC Rate.
(3) Determination of Amount of Benefits
(a) Actuarial equivalence for purposes of determining the
amount of a Participant's vested Accrued Pension with
respect to his SLT Benefit in a form of payment to
which this paragraph (3) is applicable, the interest
rate used shall not exceed:
(i) the PBGC Rate if the present value of the benefit
(using such rate or rates) is not in excess of
$25,000; or
(ii) 120 percent of the PBGC Rate if the present value
of the benefit exceeds $25,000 (as determined
under clause (i)). In no event shall the present
value determined under this clause (ii) be less
than $25,000.
(b) In no event shall the amount of the benefit or annuity
determined under this paragraph (3) be less than the
greater of:
(i) the amount of such benefit determined using the
Unisex Pension Mortality Table (UP-1984 Table)
and 6% interest; or
(ii) the amount of such benefit determined using the
PBGC Rate if the value determined in paragraph
(a) above is less than $25,000 or 120 percent of
the PBGC Rate if the value determined in
paragraph (a) above is not less than $25,000.
(4) Other Purposes
Actuarial equivalence for all other purposes under the
Plan with respect to a Participant's SLT Benefit other than
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Section 8.01 shall be determined using the Unisex Pension
Mortality Table (UP-1984 Table) and 6% interest.
C. Section 1.07 is modified by adding to the definition thereof the
following:
1.07Q "Basic Compensation" shall include only amounts earned after
December 31, 1992.
D. Section 1.14 is modified by adding to the definition thereof the
following:
1.14Q "Compensation" shall include only amounts earned after
December 31, 1992.
E. Section 1.24 is modified as follows:
1.24Q "Normal Retirement Age" means age 65.
F. Section 1.25 is modified as follows:
1.25Q Normal Retirement Date
The first day of the month coincident with or next following
the date on which an Employee attains age 65.
G. Section 1.37(d) is modified as follows:
1.37(d)Q Benefit Service
(d) The amount of the benefit payable to or on behalf of a
Participant other than the Participant's SLT Benefit shall
be determined on the basis of his Benefit Service, in
accordance with the following:
(i) Benefit Service Prior to January 1, 1993: None.
(ii) Benefit Service From and After January 1, 1993: In
accordance with the provisions of Section 1.37(d).
H. Section 1.37(f) is modified as follows:
1.37(f)Q Eligibility Year of Service
(f) A Participant's Eligibility Years of Service under the
Plan shall be determined in accordance with the following:
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<PAGE>
(i) Service Prior to January 1, 1993: An Employee's
period(s) of employment with SLT or Metropolitan shall
be counted as Eligibility Years of Service to the
extent that such periods would have counted under the
Plan if such employment had been with the Company.
(ii) Service From and After January 1, 1993: In accordance
with the provisions of Section 1.37(f).
I. Section 1.37(g) is modified as follows:
1.37(g)Q Vesting Service
(g) A Participant's eligibility for benefits under the Plan
shall be determined by his period of Vesting Service, in
accordance with the following:
(i) Service Prior to January 1, 1993: An Employee's
period(s) of employment with SLT or Metropolitan shall
be counted as Vesting Service to the extent of the
number of whole 1-year periods of service that were
similarly credited under the provisions of the
Former Plan.
(ii) Service From and After January 1, 1993: Subject to the
Break in Service provisions, an Employee, whether or
not a Participant, shall accrue one year of Vesting
Service for each calendar year in which he has
1,000 or more Hours of Service. For all purposes
except for determining eligibility for Early
Retirement Pension under Section 10.02 or Disability
Retirement Pension under Section 10.03, in determining
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such Vesting Service for the computation period which
includes January 1, 1993, the Participant shall
receive credit for a number of Hours of Service with
respect to any fractional part of a year of service
credited to the Participant as of January 1, 1993,
under the provisions of the Former Plan, determined by
crediting the Participant with 190 Hours of Service
for each 1/12th of a fractional year of service. Only
for purposes of determining eligibility for Early
Retirement Pension under Section 10.02 and Disability
Retirement Pension under Section 10.03, in determining
such Vesting Service for the computation period in
which the Participant has a Termination of Employment,
the Participant shall receive credit, for a number of
Hours of Service with respect to any fractional part
of a year of service credited to the Participant as of
January 1, 1993, under the provisions of the Former
Plan, determined by crediting the Participant with
190 Hours of Service for each 1/12th of a fractional
year of service.
(iii) Notwithstanding the provisions of part (ii), a
Participant shall not be credited with less years of
Vesting Service for service from and after
January 1, 1993 than under the method for determining
vesting service under the Former Plan.
(iv) Notwithstanding any other provision of the Plan,
there shall be no duplication of Vesting Service or
Vesting Years of Service under the Plan and the
Former Plan by reason of any restoration of, crediting
of, or granting of service in respect of any single
period or otherwise.
J. Section 1.43 is modified to add the following:
1.43Q (a) The provisions of Section 1.43 shall apply to a
Participant's Accrued Benefit other than his SLT Benefit.
(b) "Total and Permanent Disability" with respect to a
Participant's SLT Benefit means a disability, due to
sickness or injury that, in the opinion of the Plan
Administrator is likely to be continuous and permanent
from a cause other than specified below, such that the
Participant is eligible for Social Security Disability
Benefits.
A Participant will not be entitled to receive any
disability retirement benefits if, in the opinion of
the Plan Administrator, the disability is a result of:
(1) Excessive and habitual use by the Participant of
drugs, intoxicants or narcotics;
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(2) Injury or disease sustained by the Participant
while willfully and illegally participating in fights,
riots, civil insurrections or while committing a
felony;
(3) Injury or disease sustained by the Participant
while serving in any armed forces;
(4) Injury or disease sustained by the Participant
diagnosed or discovered subsequent to the date of his
Termination of Employment;
(5) Injury or disease sustained by the Participant
while working for anyone other than an Employer and
arising out of such employment;
(6) Injury or disease sustained by the Participant as a
result of war, whether or not such act arises from a
formally declared state of war;
(7) Injury or disease sustained by the Participant
while on Leave of Absence from the Employer; or
(8) Injury or disease sustained by the Participant from
self-inflicted injuries.
K. Section 1.48 is added as follows:
1.48Q "Former Plan" means the SLT Communications, Inc. Retirement
Plan, as in effect on the close of business on
December 31, 1995.
L. Section 10.02(c) is added as follows:
10.02(c)Q Early Retirement Pension
(1) A Participant with 5 or more Vesting Years of Service
whose Retirement occurs on or after the date he reaches age
55 but prior to the first day of the month coinciding or
next following his attainment of age 65 shall be eligible
for an Early Retirement Pension with respect to his SLT
Benefit.
(2) The monthly Pension of a Participant eligible for an Early
Retirement Pension with respect to his SLT Benefit as
provided under this subsection (c) who has at least 5
Vesting Years of Service but less than 15 Vesting
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Years of Service shall be, at the option of the
Participant, either (i) or (ii) as set forth below:
(i) A deferred pension commencing as of the first day of
the month coinciding with or next following the
Participant's attainment of age 65 in an amount
equal to his Accrued Pension attributable to his SLT
Benefit at the time of early retirement.
(ii) An immediate pension determined as provided in (i)
above, commencing as of the first day of any month
coinciding with or next following his early retirement
but preceding the first day of the month coinciding
with or next following the Participant's attainment of
age 65 elected by the Participant and subsequent to
his having made written application therefor, but
reduced by one-fourth of one percent for each full
month, if any, by which distribution of his Early
Retirement Pension with respect to his SLT Benefit
precedes the first day of the month coinciding with
or next following his attainment of age 65.
3. The monthly Pension of a Participant eligible for an Early
retirement Pension with respect to his SLT Benefit as
provided under this subsection (c) who retires prior to
the first day of the month coinciding with or next
following his attainment of age 60 and has at least 15
Vesting Years of Service shall be, at the option of the
Participant, either (i) or (ii) as set forth below:
(i) A deferred pension commencing as of the first day of
the month coinciding with or next following the
Participant's attainment of age 60 in an amount
equal to his Accrued Pension attributable to his SLT
Benefit at the time of early retirement.
(ii) An immediate pension determined as provided in (i)
above, commencing as of the first day of any month
coinciding with or next following his early retirement
but preceding his attainment of age 60 elected by
the Participant and subsequent to his having made
written application therefor, but reduced by
one-fourth of one percent for each full month, if
any, by which distribution of his Early Retirement
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Pension with respect to his SLT Benefit precedes the
first day of the month coinciding with or next
following his attainment of age 60.
(4) The monthly Pension of a Participant eligible for an Early
Retirement Pension with respect to his SLT Benefit as
provided under this subsection (c) who retires on or after
the first day of the month following his attainment of age
60 but prior to the first day of the month coinciding with
or next following his attainment of age 65 and has
at least 15 Vesting Years of Service shall be in an amount
equal to his Accrued Pension attributable to his SLT
Benefit at the time of early retirement, without any
reduction for early commencement, commencing on the first
day of the month coinciding with or next following the
participant's early retirement.
If a Participant elects commencement of his SLT Benefit under
this subsection (c), the Participant's Accrued Pension shall be
calculated without regard to such SLT Benefit.
M. Section 10.03 is modified as follows:
10.03Q Disability Retirement Pension
(a) The provisions of Section 10.03 shall apply with respect to
a Participant's disability retirement benefits other than
disability retirement benefits attributable to his SLT
Benefit.
(b) A Participant who has a Termination of Employment due to
his Total and Permanent Disability prior to his Normal
Retirement Date shall be entitled to a Disability
Retirement Pension with respect to his SLT Benefit, in the
amount of his Accrued Pension with respect to his SLT
Benefit.
(c) Payment of the Participant's Disability Retirement Pension
with respect to his SLT Benefit shall commence upon the
first day of the month coinciding or next following his
attainment of age 65, if he is then living and totally
disabled.
(d) In the event that the death of a disabled Participant
occurs after he has been determined to be disabled by the
Plan Administrator, but prior to his Normal Retirement Date
and after earning 5 Vesting Years of Service, his
Beneficiary with respect to his SLT Benefit shall receive
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the death benefit provided under Section 12.01Q, based on
the Participant's Accrued Benefit attributable to his SLT
Benefit.
(e) If a Participant who had a Termination of Employment as a
result of his Total and Permanent Disability is, at
any time prior to his Normal Retirement Date, no longer
disabled as provided herein, and if, at the date he became
disabled, he had completed at least 5 Vesting Years of
Service, he will be entitled to a Normal Retirement
Benefit or Early Retirement Benefit based upon the
Participant's Accrued Benefit attributable to his SLT
Benefit and his age as of the date of his recovery from
disability.
N. Section 10.04 is modified as follows:
10.04Q Deferred Vested Pension Upon Termination of Employment
(f) (i) A former Participant who has at least 5 Vesting Years
of Service but who is not eligible for a Normal
Retirement Pension, an Early Retirement Pension, or a
Disability Retirement Pension shall be entitled to a
Deferred Vested Pension with respect to his SLT
Benefit. The monthly Pension of a former Participant
eligible for a Deferred Vested Pension with respect to
his SLT Benefit shall be equal to his Accrued Pension
attributable to his SLT Benefit, adjusted for the
cost of pre-retirement death benefit coverage on the
basis of the mortality assumption used to determine
Actuarial Equivalence under Section 1.03Q; provided,
however, that the Participant may elect to waive the
pre-retirement death benefit coverage during the
"applicable election period", subject to the consent
of his spouse in the manner described in subsection
(b) of Section 11.04, in which case such adjustment
will not be made. The "applicable election period"
means the period beginning 90 days before the date as
of which a Participant has a Termination of Employment
and ending on the earliest to occur of the date he
is reemployed by the Company or a member of the
Controlled Group, the date his Pension commences
with respect to his SLT Benefit, or the date of his
death. A Participant may elect to waive,
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or revoke the election to waive, the preretirement
death benefit coverage with respect to his SLT
Benefit at any time during such period. The Deferred
Vested Pension with respect to the SLT Benefit of a
former Participant shall commence as of the first
day of the month coinciding with or next following his
attainment of age 65, except that a former Participant
who has attained age 55 may elect to commence as of
the first day of any month which is prior to his
Normal Retirement Date and after he attains age 55,
but if his Deferred Vested Pension attributable to his
SLT Benefit commences prior to his Normal Retirement
Date, it shall be actuarially reduced from Normal
Retirement Date to the early commencement date on the
basis of the assumptions used to determine Actuarial
Equivalence under Section 1.03Q.
(ii) If a Participant elects commencement of his SLT
Benefit under this Section 10.04Q, the Participant's
Accrued Pension shall be calculated without regard to
his SLT Benefit.
O. Section 11.01(b) is modified as follows:
11.01(b)Q Normal and Early Retirement Pensions
(b) (1) Subsection (b) of Section 11.01 shall apply with
respect to a Participant's Accrued Pension other than
his SLT Benefit.
(2) The normal form of benefit for a Participant with
respect to his SLT Benefit is a 5-year certain and
life annuity for the life of the Participant.
Notwithstanding the foregoing, a married Participant
shall be deemed to have elected with respect to his
SLT Benefit an Actuarially Equivalent qualified
joint and 2/3 survivor annuity in the form of Option 2
under paragraph (g) of Section 11.05Q with his Spouse
as joint pensioner, and a Participant who is not
married shall be deemed to have elected a single life
annuity in the form of Option 1 under paragraph (g) of
Section 11.04Q. An optional form of benefit payment
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may be elected pursuant to Section 11.05Q.
P. Section 11.05 is modified as follows:
11.05Q Optional Forms of Pension
(g) A Participant may waive the normal form of payment
applicable to his SLT Benefit and elect to receive one of
the following optional forms of payment with respect only
to his SLT Benefit. Any optional form of payment shall be
the Actuarial Equivalent of the Participant's Accrued
Benefit attributable to his SLT Benefit in the form of a
5-year certain and life annuity payable for the life of the
Participant. The provisions of subsection (c) of Section
11.04 shall not apply with respect to a Participant's SLT
Benefit.
Option 1. Life Annuity - an annuity payable for the life of
the Participant.
Option 2. Joint and 2/3 Survivor Annuity - an annuity
payable during the joint lives of the Participant
and a joint pensioner designated by him, and
following the death of either of them, 2/3 of
such modified monthly amount payable to the
survivor for the lifetime of the survivor.
Option 3. Joint and 100% Survivor Annuity - an annuity
payable during the joint lives of the Participant
and a joint pensioner designated by him, and
following the death of either of them, 100%
of such modified monthly amount payable to the
survivor for the lifetime of the survivor.
Option 4. Life Annuity with 5 or 10 Year Certain Feature -
an annuity for the life of the Participant and if
60 or 120 monthly payments have not been paid
prior to the Participant's death, the annuity is
payable to the Beneficiary or Beneficiaries with
respect to his SLT Benefit designated by
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the Participant for the balance of such 60
or 120 month.
Option 5. Lump Sum Payment - the single sum value of the
Participant's Accrued Benefit attributable to his
SLT Benefit otherwise payable using an interest
rate equal to the lesser of 6% or the PBGC rate.
If the designated Beneficiary (or beneficiaries) or joint
pensioner with respect to a Participant's SLT Benefit dies
before the date that the Participants Pension attributable
to his SLT Benefit commences, the option elected will be
automatically cancelled and a retirement income of the form
and amount otherwise payable in accordance with the
provisions of Section 11.01(b)(2)Q will be payable to
the Participant as if the election had not been made. The
Participant may make a new election in accordance with the
provisions of this Section or a new Beneficiary designation
with respect to his SLT Benefit prior to the date that his
Pension attributable to his SLT Benefit commences.
Notwithstanding the foregoing, a Participant whose SLT
Benefit commences as of the same time as his Accrued
Pension (other than his SLT Benefit) may elect to receive
his entire benefit in any form permitted and under the
conditions and actuarial equivalence provisions of the
Plan (other than this Appendix Q).
Q. Section 11.09 is modified as follows:
11.09Q Suspension of Benefits Upon Reemployment.
(a) Section 11.09 shall apply with respect to a Participant's
retirement benefits other than retirement benefits
attributable to his SLT Benefit that have commenced.
(b) Section 11.09 shall apply with respect to a Participant's
retirement benefits attributable to his SLT Benefit if
he is reemployed after such retirement benefits commenced,
except that, the Participant may irrevocably elect to
continue payment of his retirement benefits attributable
to his SLT Benefit after he is reemployed. In which case,
the benefit, if any, that such Participant accrues under
the Plan subsequent to his reemployment shall not cause the
actuarial equivalent of the total income payable to the
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Participant or his Beneficiary to exceed the amount that
would have been payable if he had not elected to continue
to receive retirement benefits attributable to his SLT
Benefit after his reemployment.
R. Section 11.10 is modified as follows:
11.10Q Limitations on Distributions
(g) The provisions of this Section 11.10 shall not apply with
respect to a Participant's SLT Benefit to any method of
distribution designated in writing by a Participant under
the terms of the Former Plan before January 1, 1984, in
accordance with Section 242(b)(2) of the Tax Equity
and Fiscal Responsibility Act of 1982 (as in effect before
the amendments made by the Tax Reform Act of 1984).
S. Section 11.11 is modified as follows:
11.11Q Employment After Normal Retirement Age
(a) Section 11.11 shall apply with respect to a Participant's
retirement benefits other than retirement benefits
attributable to his SLT Benefit that have commenced.
(b) Section 11.11 shall apply with respect to a Participant's
retirement benefits attributable to his SLT Benefits
unless he has elected to continue payment of such
retirement benefits pursuant to subsection (b) of Section
11.09Q.
T. Section 12.01 is modified as follows:
12.01Q Death Prior to Pension Commencement
(g) In determining the monthly Qualified Preretirement Survivor
Annuity under subsections (a)-(e) of Section 12.01,
the Accrued Pension of the Participant shall be calculated
without regard to his SLT Benefit.
(h) In the event that a Participant who is an Employee or a
Participant who has been determined by the Plan
Administrator to be Totally and Permanently Disabled and
who has at least 5 Vesting Years of Service dies prior to
commencement of retirement benefits to him, his Spouse or
other Beneficiary with respect to his SLT Benefit
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designated with his Spouse's consent will receive the
monthly income, payable for life, and beginning on the
first day of the month coincident with or next following
the date of the Participant's death, which can be provided
on an Actuarially Equivalent basis by the single sum value
of the Participant's SLT Benefit otherwise determined under
this Appendix Q to which the Participant was entitled on
the date of his death. Such benefit shall be payable on a
5-year certain and life basis, unless the Participant's
Spouse or other Beneficiary with respect to his SLT Benefit
designated with his Spouse's consent elects to receive in
lieu of such monthly income, the Actuarial Equivalent of
such benefit in any form of payment available under this
Appendix Q.
(i) In the event that a Participant dies prior to
commencement of retirement benefits to him, and the
Participant has not waived the preretirement death
benefit, his Spouse or other Beneficiary with respect
to his SLT Benefit designated with his Spouse's
consent, will receive the monthly income, payable for
life, and beginning on the first day of the month
coincident with or next following the date of the
Participant's death, which can be provided on an
Actuarially Equivalent basis by the single sum value
of the benefit determined under Section 10.04Q, to
which the Participant was entitled on the date of
his Termination of Employment; provided, however, that
the Participant's Spouse or other Beneficiary with
respect to his SLT Benefit designated with his
Spouse's consent may elect to receive in lieu
thereof, the Actuarial Equivalent of such benefit in
the form of a 5-year certain and life or a 10-year
certain and life benefit if the Participant or the
Beneficiary with respect to his SLT Benefit so elects.
(j) If a deceased Participant who has at least 5 Vesting
Years of Service and on whose behalf a preretirement
death benefit is payable under this Section 12.01Q had
been married to his spouse throughout the one-year
period immediately preceding his death and he had
designated a person other than his Spouse as his
Beneficiary with respect to his SLT Benefit and such
Spouse had not consented to such other person being
designated as the Beneficiary with respect to his
SLT Benefit, the Participant shall be deemed to have:
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(1) revoked his prior designation of Beneficiary with
respect to his SLT Benefit as to the portion of
his death benefit payable under this subsection
(j);
(2) designated such Spouse as his Beneficiary with
respect to his SLT Benefit to receive a portion
of the death benefit payable on his behalf under
subsection (h) or (i) of this Section 12.01Q,
whichever is applicable;
(3) specified that the portion of the benefit
provided under subsection (h) or (i) of this
Section 12.01Q will be payable as an Actuarially
Equivalent monthly income payable on the first
day of each month with the first payment being
due (only if the Spouse is then living) on the
earliest date as of which payments to the
Participant could have commenced under this
Appendix Q if the Participant had survived until
such date (the "Earliest Annuity Commencement
Date"), and with the last payment being the
payment due next preceding such Spouse's death;
(4) specified that the portion of the benefit
provided under subsection (h) or (i) of this
Section 12.01Q shall have the Actuarially
Equivalent single-sum value, determined as of the
date of the Participant's death, equal to the
single-sum value, determined as of the date of
his death, that would be payable to his surviving
Spouse, commencing on the Earliest Annuity
Commencement Date, under a qualified joint and
2/3 survivor annuity option if:
(i) the Participant had a Termination of
Employment on the date of his death for a
reason other than disability retirement
or death (or if the Participant is eligible
for a Deferred Vested Retirement Benefit
under Section 10.04Q, he had survived to the
Earliest Annuity Commencement Date);
(ii) the Participant had (for the purpose of
determining the amount of such monthly
retirement income commencing at the Earliest
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Annuity Commencement Date) waived the
preretirement death benefit coverage under
subsection (i) of this Section 12.01Q, if
applicable, during the period beginning on
the date of his death and ending on the
Earliest Annuity Commencement Date;
(iii) the Participant had died immediately after
such commencement of payments (one-half of
the initial payment which would have been
due the Participant on such Earliest Annuity
Commencement Date shall be included in
the determination of such single-sum value);
and
(5) designated such other person (or persons) that
was named as his Beneficiary with respect to his
SLT Benefit under such revoked designation of
Beneficiary with respect to his SLT Benefit to
receive the remaining portion of such benefit
payable on his behalf under and in accordance
with subsection (h) or (i) of this Section
12.01Q.
In lieu of the monthly income determined above, the
Participant's Spouse may elect to receive the
Actuarial Equivalent of such benefit in any form of
payment available under this Appendix Q. For purposes
of paragraphs (4) and (5) above, the Earliest Annuity
Commencement Date of a deceased disabled Participant
on whose behalf a death benefit is payable under
subsection (h) of this Section 12.01Q and the monthly
retirement income that would be payable to his
surviving Spouse, commencing on the Earliest Annuity
Commencement Date, under the qualified joint and 2/3
survivor annuity option, shall be determined as though
such Participant had recovered from his total and
permanent disability and had been reemployed by a
member of the Controlled Group immediately prior to
his death.
(k) Each Participant may, on the form and in the manner
prescribed by the Plan Administrator, designate a
Beneficiary (or beneficiaries) with respect to his SLT
Benefit to receive the benefit, if any, that may be
payable with respect to the Participant's SLT Benefit
in the event of his death, and each designation
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may be revoked by such Participant by filing a new
designation of Beneficiary with respect to his SLT
Benefit. If a deceased Participant failed to name a
Beneficiary with respect to his SLT Benefit in the
manner above prescribed or if the Beneficiary (or
beneficiaries) with respect to his SLT Benefit
designated by a deceased Participant predeceases the
Participant, the death benefit, if any, which may be
payable under this Appendix Q with respect to such
deceased Participant shall be paid to the Spouse, and
in the absence of a Spouse to the estate of such
deceased Participant. A Participant may change his
Beneficiary with respect to his SLT Benefit at any
time, subject to his Spouse's written consent in
accordance with subsection (b) of Section 11.04. A
Participant's designation of Beneficiary with respect
to his SLT Benefit shall be void upon his reaching
nine months prior to early retirement age or upon
marriage or remarriage, at which time the Participant
may designate a new Beneficiary with respect to his
SLT Benefit.
(l) If both the Participant and the Beneficiary (or
beneficiaries) with respect to his SLT Benefit
designated by him die after the date that the
Participant's SLT Benefit commences under the Plan,
but before the full payment has been effected under
any option under this Appendix Q providing for
payments for a period certain, the commputed value of
the payments for the remainder of the period certain
shall be paid in a lump sum to any contingent
beneficiary designated fy the Participant, or if the
Participant has not desinated a contingent
beneficiary, the contingent beneficiary designated by
the Beneficiary with respect to his SLT Benefit;
provided, however, that if no person so designated is
living upon the occurrence of such contingency, then
the remaining death benefits, if any, shall be
payable to the estate of such Beneficiary with
respect to his SLT Benefit in a lump sum.
IN WITNESS WHEREOFF, the Company, by its duly authorized
officer, has caused this Amendment to be executed on this 27th day of
December, 1995.
ALLTEL Corporation
By: /s/ John L. Comparin
Title: V.P. Human Resources
122
Exhibit 10 (l)(2)
AMENDMENT NO. 3
TO
ALLTEL CORPORATION PROFIT-SHARING PLAN
(January 1, 1994 Restatement)
WHEREAS, ALLTEL Corporation (the "Company") maintains the
ALLTEL Corporation Profit-Sharing Plan, as amended and restated effective
January 1, 1994, and subsequently further amended, (the "Plan"); and
WHEREAS, the Company desires further to amend the Plan;
NOW THEREFORE, BE IT RESOLVED, that the Company hereby amends
the Plan in the following respects:
1. Effective as of January 1, 1994, a new Section 1.33-A is
added to the Plan to provide as follows:
1.33-A Schedule
Schedule A to the Plan and any schedule added to the Plan for Plan
Years beginnning on or after January 1, 1995 pursuant to Section 1.33
and Section 13.01. Each schedule is incorporated into and made a part
of the Plan.
2. Effective as of January 1, 1994, Section 13.01 of the Plan is
amended to provide as follows:
13.01 Employer Contributions
For each Plan Year, there shall be an annual Employer Contribution
under the Plan in an amount that the Board of Directors shall
determine by resolution. For the Plan Year beginning on
January 1, 1994, the portion of the Employer Contribution assigned to
each Region shall be as set forth on Schedule A to the Plan. For each
Plan Year beginning after January 1, 1994, the resolution shall adopt
a Schedule to the Plan specifying the portion of the Employer
Contribution assigned to each Region, which shall be in the ratio
that the amount equal to the percentage specified on the Schedule for
the Region multiplied by the Compensation for the Plan Year of the
Participants in the Region bears to the amount equal to the sum of
the amounts equal to the percentage specified on the Schedule with
respect to each Region multiplied by the Compensation for the Plan
Year of Participants in that Region. The resolution shall be adopted
for a Plan Year not later than the time prescribed by law for filing
the Employer's Federal income tax return for its applicable taxable
year, including extensions thereof. Portions of the Employer
Contribution shall be uniform with respect to more than one Region to
the extent necessary to comply with applicable regulations under
Section 401(a)(26) of the Code. In any event, the annual Employer
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<PAGE>
Contribution so determined and so assigned to each Region shall be
an amount not less than 2% of the aggregate Compensation for the
Plan Year of all Participants in that Region.
3. Effective as of January 1, 1994, the Plan is amended by the
addition of a Schedule A to provide as follows:
SCHEDULE A
1994 EMPLOYER CONTRIBUTION
For the Plan Year beginning January 1, 1994, the Employer Contribution
shall be assigned to each Region specified below based on the ratio that
the amount equal to the percentage specified below multiplied by the
Compensation for the 1994 Plan Year of Participants in the Region bears
to the amount equal to the sum of the amounts equal to the percentage
specified below for each Region multiplied by the Compensation for the
1994 Plan Year of Participants in that Region.
Region Percentage
Telephone:
Northeast 7
Southern 10
Southwest 7
ALLTEL Mobile, Inc. 10
ALLTEL Publishing, Inc. 7
ALLTEL Supply, Inc. 10
Sygnis 4
HWC 4
ALLTEL Telephone Service Corp. 10
ALLTEL Corporation and
ALLTEL Corporate Services 10
2
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<PAGE>
4. Effective as of January 1, 1995, Section 1.33 of the Plan is
amended to provide as follows:
1.33 Region
An operating region, corporate division, or other grouping of Employees of
the Employer, as set forth on a Schedule to the Plan adopted by the Board
of Directors for each Plan Year not later than the time prescribed by law
for filing the Employer's Federal income tax return for its applicable
taxable year, including extensions thereof.
IN WITNESS WHEREOF, the Company, by its duly authorized officer,
has caused this Amendment to be executed on this 12th day of December, 1995.
ALLTEL CORPORATION
By: /s/ John L. Comparin
Title: V.P. Human Resources
125
<PAGE>
AMENDMENT NO. 4
TO
ALLTEL CORPORATION PROFIT-SHARING PLAN
(January 1, 1994 Restatement)
WHEREAS, ALLTEL Corporation (the "Company") maintains the
ALLTEL Corporation Profit-Sharing Plan, as amended and restated effective
January 1, 1994, and subsequently further amended, (the "Plan"); and
WHEREAS, the Company desires further to amend the Plan;
NOW THEREFORE, BE IT RESOLVED, that the Company hereby amends
the Plan in the respects hereinafter set forth.
1. Effective as of October 28, 1995, the phrase "paragraph (b),
(c), (d), or (e)" in paragraph (a) of Section 9.04 of the Plan is deleted
therefrom and the phrase "paragraph (b), (c), (d), (e), or (f)" is substituted
therefor, and Section 9.04 of the Plan is amended by adding a new paragraph (f)
at the end thereof to provide as follows:
(f) In determining Years of Eligibility Service for an Employee who
was an employee of Dime Savings Bank, F.S.B. ("Dime")
immediately prior to October 28, 1995, and became an Employee on
October 28, 1995, the Employee's period or periods of employment
with Dime prior to October 28, 1995, that would have been taken
into account under the Plan if such period or periods of
employment were service with a member of the Controlled Group,
shall be counted as Years of Eligibility Service.
Notwithstanding any other provision of the Plan, there shall be
no duplication of Years of Eligibility Service under the Plan
by reason of service (or hours of service) in respect of any
single period or otherwise.
2. Effective as of December 1, 1995, the phrase "paragraph
(b), (c), (d), (e), or (f)" in paragraph (a) of Section 9.04 of the Plan is
deleted therefrom and the phrase "paragraph (b), (c), (d), (e), (f), or (g)"
is substituted therefor, and Section 9.04 of the Plan is amended by adding a
new paragraph (g) at the end thereof to provide as follows:
(g) In determining Years of Eligibility Service for an Employee who
was an employee of Glendale Federal Bank, F.S.B. ("Glendale")
immediately prior to December 1, 1995, and became an Employee
on December 1, 1995, the Employee's period or periods of
employment with Glendale prior to December 1, 1995, that would
have been taken into account under the Plan if such period or
periods of employment were service with a member of the
Controlled Group, shall be counted as Years of Eligibility
Service. Notwithstanding any other provision of the Plan, there
shall be no duplication of Years of Eligibility Service under
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<PAGE>
the Plan by reason of service (or hours of service) in respect
of any single period or otherwise.
3. Effective as of October 28, 1995, the phrase "paragraph (b),
(c), (d), (e), or (f)" in paragraph (a) of Section 9.05 of the Plan is deleted
therefrom and the phrase "paragraph (b), (c), (d), (e), (f), or (g)" is
substituted therefor, and Section 9.05 of the Plan is amended by adding a new
paragraph (g) at the end thereof to provide as follows:
(g) In determining Years of Vesting Service for an Employee who was
an employee of Dime Savings Bank, F.S.B. ("Dime") immediately
prior to October 28, 1995, and became an Employee on
October 28, 1995, the Employee's period or periods of employment
with Dime prior to October 28, 1995, that would have been taken
into account under the Plan if such period or periods of
employment were service with a member of the Controlled Group,
shall be counted as Years of Vesting Service. Notwithstanding
any other provision of the Plan, there shall be no duplication
of Years of Vesting Service under the Plan by reason of service
(or hours of service) in respect of any single period or
otherwise.
4. Effective as of December 1, 1995, the phrase "paragraph
(b), (c), (d), (e), (f), or (g)" in paragraph (a) of Section 9.05 of the Plan
is deleted therefrom and the phrase "paragraph (b), (c), (d), (e), (f), (g),
or (h)" is substituted therefor, and Section 9.05 of the Plan is amended by
adding a new paragraph (h) at the end thereof to provide as follows:
(h) In determining Years of Vesting Service for an Employee who
was an employee of Glendale Federal Bank, F.S.B. ("Glendale")
immediately prior to December 1, 1995, and became an Employee on
December 1, 1995, the Employee's period or periods of employment
with Glendale prior to December 1, 1995, that would have been
taken into account under the Plan if such period or periods
of employment were service with a member of the Controlled
Group, shall be counted as Years of Vesting Service.
Notwithstanding any other provision of the Plan, there shall be
no duplication of Years of Vesting Service under the Plan by
reason of service (or hours of service) in respect of any single
period or otherwise.
5. Effective as of May 30, 1995, Section 13.05 of the Plan is
amended by adding a new paragraph (d) at the end thereof to provide as follows:
(d) Each person who
(i) was an active employee of Vertex Business Systems, Inc.
and became an Employee on May 30, 1995;
(ii) met the eligibility requirements to become a Participant
on or before the last day of the 1995 Plan Year; and
2
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<PAGE>
(iii) is not otherwise eligible for an allocation of Employer
Contribution for the 1995 Plan Year under Section 13.04;
shall receive an allocation of Employer Contribution for the
1995 Plan Year as provided in this paragraph (d), if the
Participant is credited with at least such number of Hours of
Service as the number determined by multiplying 1,000 by a
fraction the numerator of which is the number of days of
employment with the Controlled Group completed by the
Participant in the 1995 Plan Year and the denominator of which
is three hundred sixty-five (365). Subject to the last sentence
of Section 13.01, the portion of Employer Contribution assigned
to the Region including such Participants shall be specified on
the Schedule for the 1995 Plan Year and shall be allocated
among the Participants in such Region as provided in Section
13.04, but without regard to the requirement that a Participant
have a Year of Participation. Notwithstanding the provisions of
Section 13.04, any Participant who would receive an allocation
of Employer Contribution under this paragraph (d) but for his
transfer of employment prior to December 31, 1995, shall be
deemed to be in the Region including the Participants eligible
under this paragraph (d) for the 1995 Plan Year.
6. Effective as of July 31, 1995, Section 13.05 of the Plan is
amended by adding a new paragraph (e) at the end thereof to provide as follows:
(e) Each person who
(i) was an active employee of First Michigan Bank Corporation
and became an Employee on July 31, 1995;
(ii) met the eligibility requirements to become a Participant
on or before the last day of the 1995 Plan Year; and
(iii) is not otherwise eligible for an allocation of Employer
Contribution for the 1995 Plan Year under Section 13.04;
shall receive an allocation of Employer Contribution for the
1995 Plan Year as provided in this paragraph (e), if the
Participant is credited with at least such number of Hours of
Service as the number determined by multiplying 1,000 by a
fraction the numerator of which is the number of days of
employment with the Controlled Group completed by the
Participant in the 1995 Plan Year and the denominator of which
is three hundred sixty-five (365). Subject to the last sentence
of Section 13.01, the portion of Employer Contribution assigned
to the Region including such Participants shall be specified on
the Schedule for the 1995 Plan Year and shall be allocated
among the Participants in such Region as provided in
Section 13.04, but without regard to the requirement that a
Participant have a Year of Participation. Notwithstanding the
3
128
<PAGE>
provisions of Section 13.04, any Participant who would receive
an allocation of Employer Contribution under this paragraph
(e) but for his transfer of employment prior to
December 31, 1995, shall be deemed to be in the Region
including the Participants eligible under this paragraph (e) for
the 1995 Plan Year.
7. Effective as of August 31, 1995, Section 13.05 of the Plan
is amended by adding a new paragraph (f) at the end thereof to provide as
follows:
(f) Each person who
(i) was an active employee of BellSouth Mobility Inc. and
became an Employee on August 31, 1995;
(ii) met the eligibility requirements to become a Participant
on or before the last day of the 1995 Plan Year; and
(iii) is not otherwise eligible for an allocation of Employer
Contribution for the 1995 Plan Year under Section 13.04;
shall receive an allocation of Employer Contribution for the
1995 Plan Year as provided in this paragraph (f), if the
Participant is credited with at least such number of Hours of
Service as the number determined by multiplying 1,000 by a
fraction the numerator of which is the number of days of
employment with the Controlled Group completed by the
Participant in the 1995 Plan Year and the denominator of which
is three hundred sixty-five (365). Subject to the last
sentence of Section 13.01, the portion of Employer Contribution
assigned to the Region including such Participants shall be
specified on the Schedule for the 1995 Plan Year and shall be
allocated among the Participants in such Region as provided in
Section 13.04, but without regard to the requirement that a
Participant have a Year of Participation. Notwithstanding the
provisions of Section 13.04, any Participant who would receive
an allocation of Employer Contribution under this paragraph
(f) but for his transfer of employment prior to
December 31, 1995, shall be deemed to be in the Region including
the Participants eligible under this paragraph (f) for the 1995
Plan Year.
8. Effective as of October 28, 1995, Section 13.05 of the
Plan is amended by adding a new paragraph (g) at the end thereof to provide
as follows:
(g) Each person who
(i) was an active employee of Dime Savings Bank, F.S.B. and
became an Employee on October 28, 1995;
4
129
<PAGE>
(ii) met the eligibility requirements to become a Participant
on or before the last day of the 1995 Plan Year; and
(iii) is not otherwise eligible for an allocation of Employer
Contribution for the 1995 Plan Year under Section 13.04;
shall receive an allocation of Employer Contribution for the
1995 Plan Year as provided in this paragraph (g), if the
Participant is credited with at least such number of Hours of
Service as the number determined by multiplying 1,000 by a
fraction the numerator of which is the number of days of
employment with the Controlled Group completed by the
Participant in the 1995 Plan Year and the denominator of which
is three hundred sixty-five (365). Subject to the last
sentence of Section 13.01, the portion of Employer Contribution
assigned to the Region including such Participants shall be
specified on the Schedule for the 1995 Plan Year and shall be
allocated among the Participants in such Region as provided in
Section 13.04, but without regard to the requirement that a
Participant have a Year of Participation. Notwithstanding the
provisions of Section 13.04, any Participant who would receive
an allocation of Employer Contribution under this paragraph
(g) but for his transfer of employment prior to
December 31, 1995, shall be deemed to be in the Region including
the Participants eligible under this paragraph (g) for the 1995
Plan Year.
9. Effective as of November 7, 1995, Section 13.05 of the
Plan is amended by adding a new paragraph (h) at the end thereof to provide
as follows:
(h) Each person who
(i) was an active employee of Evergreen Bancorp, Inc. and
became an Employee on November 7, 1995;
(ii) met the eligibility requirements to become a Participant
on or before the last day of the 1995 Plan Year; and
(iii) is not otherwise eligible for an allocation of Employer
Contribution for the 1995 Plan Year under Section 13.04;
shall receive an allocation of Employer Contribution for the
1995 Plan Year as provided in this paragraph (h), if the
Participant is credited with at least such number of Hours of
Service as the number determined by multiplying 1,000 by a
fraction the numerator of which is the number of days of
employment with the Controlled Group completed by the
Participant in the 1995 Plan Year and the denominator of which
is three hundred sixty-five (365). Subject to the last sentence
of Section 13.01, the portion of Employer Contribution assigned
to the Region including such Participants shall be specified on
the Schedule for the 1995 Plan Year and shall be allocated
5
130
<PAGE>
among the Participants in such Region as provided in
Section 13.04, but without regard to the requirement that a
Participant have a Year of Participation. Notwithstanding the
provisions of Section 13.04, any Participant who would receive
an allocation of Employer Contribution under this paragraph (h)
but for his transfer of employment prior to December 31, 1995,
shall be deemed to be in the Region including the Participants
eligible under this paragraph (h) for the 1995 Plan Year.
10. The first paragraph of Section 1.07 of the Plan is amended,
effective as if such provisions were set forth in the January 1, 1994
Restatement, to provide as follows:
The amount paid by the Employer during the Plan Year directly to the
Employee, including basic wages, cash bonuses, overtime compensation,
commissions, shift differentials, in-charge premiums, and any amount the
payment of which is deferred under the ALLTEL Corporation Executive
Deferred Compensation Plan, the ALLTEL Corporation Performance Incentive
Compensation Plan, or the ALLTEL Corporation Long-Term Performance
Incentive Plan, but excluding any other forms of additional compensation
and further excluding non-wage taxable fringe benefits. Compensation which
a Participant elects to defer under the above-specified plans shall, for
purposes of the Plan, be credited to the Participant as compensation
during the period when such deferred amounts would have been paid (in the
absence of the deferral election) rather than during the period when
such deferred amounts are earned or actually paid. Compensation shall be
determined without regard to any compensation reduction pursuant to an
arrangement under a "cafeteria plan" as defined in Section 125 of the
Code or pursuant to a "qualified cash or deferred arrangement" as
defined in Section 401(k) of the Code.
11. The term "Schedule A" in subsection (b) of Section 1.12, in
the second paragraph of Section 13.03, and in the title of Schedule A to ALLTEL
Corporation Profit-Sharing Plan (January 1, 1994 Restatement) shall be deleted
and the term "Appendix A" shall be substituted therefore in each place such
term appears, effective as if such provisions were set forth in the
January 1, 1994 Restatement.
IN WITNESS WHEREOF, the Company, by its duly authorized officer,
has caused this Amendment to be executed on this 25th day of January, 1996.
ALLTEL CORPORATION
By: /s/ John L. Comparin
Title: V.P. Human Resources
131
Exhibit 10(m)
ALLTEL CORPORATION
EXCESS BENEFIT PLAN
(January 1, 1996 Restatement)
ARTICLE I
Preamble
Section 1.01. Restatement. The ALLTEL Corporation Excess
Benefit Plan, established effective as of January 1, 1988, as heretofore
amended, is hereby amended and restated in its entirety, effective as of
January 1, 1996, but with respect only to employees whose employment with the
Company and all members of the Controlled Group terminates after 1995.
Section 1.02. Purpose. The purpose of the Plan is solely to
provide benefits in excess of the limitations of Section 415 and
Section 401(a)(17) of the Internal Revenue Code of 1986, as amended, or
corresponding provisions of any subsequent federal tax laws ("Code"), to a
select group of management or highly compensated employees.
Section 1.03. Funding. The Plan is unfunded, and the rights,
if any, of any person to any benefits hereunder shall be the same as any
unsecured general creditor of the Company. The benefits payable under the
Plan shall be paid by the Company from its general assets.
ARTICLE II
Definitions and Interpretation
Section 2.01. Definitions. When the initial letter of a word
or phrase is capitalized herein, such word or phrase shall have the meaning
hereinafter set forth:
(a) "Beneficiary" means the beneficiary, if any, designated by
a Participant in accordance with Section 2.07.
(b) "Board" means the Board of Directors of the Company.
(c) "CEO" shall mean the Chief Executive Officer of the Company.
(d) "Committee" shall mean the Compensation Committee of the
Board.
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(e) "Company" means ALLTEL Corporation, a Delaware corporation,
its successors and survivors resulting from any merger or
acquisition of ALLTEL Corporation with or by any other
corporation or other entity or enterprise.
(f) "Excess Compensation" means the portion of a Participant's
compensation for a Plan Year that is not considered
Compensation under the Profit-Sharing Plan or Thrift Plan,
as applicable, because of the limitations of
Section 401(a)(17) of the Code, determined without regard to
the provisions of Section 4.02.
(g) "Participant" means a participant under the Profit-Sharing
Plan, the Pension Plan, the Thrift Plan, or any combination
of those plans (i) who has been designated by the Committee
or the CEO as being eligible to participate in the Plan,
(ii) who has agreed to be bound by the provisions of the
Plan on a form provided by the Company, and (iii) who is or
may be, or whose beneficiaries are or may be, entitled to
benefits under the Plan.
(h) "Pension Plan" means the ALLTEL Corporation Pension Plan"
as amended from time to time.
(i) "Plan" means the "ALLTEL Corporation Excess Benefit Plan"
as set forth herein and as it may be amended from time to
time hereafter.
(j) "Profit-Sharing Plan" means the "ALLTEL Corporation
Profit-Sharing Plan" as amended from time to time.
(k) "Profit-Sharing Plan Excess Benefit Account" means the book
reserve established for each Participant to which shall be
credited his benefit, if any, under Article III of the Plan.
(l) "Thrift Plan" means the "ALLTEL Corporation Thrift Plan" as
amended from time to time.
(m) "Thrift Plan Excess Benefit Account" means the book reserve
established for each Participant to which shall be credited
his benefit, if any, under Article IV of the Plan.
(n) "Thrift Plan 401(a)(17) Measuring Period" means each
twelve-month period beginning on and after January 1, 1996
used under the Thrift Plan as the measuring period for
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purposes of complying with the limitations of
Section 401(a)(17) of the Code.
When the initial letter of a word or phrase is capitalized herein and the
word or phrase is not defined above, in this Section 2.01, the word or phrase
shall have the meaning provided in the Profit-Sharing Plan, the Pension Plan,
or the Thrift Plan, as applicable.
Section 2.02. Construction and Governing Law.
(a) The Plan shall be construed, enforced, and administered and
the validity thereof determined in accordance with the laws
of the State of Delaware, to the extent that applicable
federal law does not apply to the Plan.
(b) Words used herein in the masculine gender shall be
construed to include the feminine gender where appropriate
and the words used herein in the singular or plural shall
be construed as being in the plural or singular where
appropriate.
ARTICLE III
Profit-Sharing Plan Benefits
Section 3.01. Allocations. If, for any Plan Year during which an
employee is a Participant, the allocation of contributions and forfeitures
made to the Participant's account under the Profit-Sharing Plan is less than
the allocation that would have been made to the Participant's account under
the Profit-Sharing Plan but for the application of the limitations under
Section 401(a)(17) of the Code, the Participant's Profit-Sharing Plan Excess
Benefit Account shall be credited with an amount equal to the percentage of
Compensation allocated to Participants (as defined in the Profit-Sharing
Plan) in the same "Region" as the Participant under the Profit-Sharing Plan
for that Plan Year multiplied by the Participant's Excess Compensation for
that Plan Year; determined without regard to the limitation under Section 415
of the Code. Credits to the Participant's Profit-Sharing Plan Excess Benefit
Account shall occur as of the date(s) the allocation(s) of contributions and
forfeitures to the Participant's account under the Profit-Sharing Plan
occur(s).
Section 3.02. Gain (Loss) Adjustments. The balance of a
Participant's Profit-Sharing Plan Excess Benefit Account shall be credited
with gain (or debited with loss) equal to the gain (or loss) the balance
would have experienced had it been invested in the Trust Fund of the
Profit-Sharing Plan at the same time(s) and in the same manner as an account
under the Profit-Sharing Plan.
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Section 3.03. Vesting. A Participant's Profit-Sharing Plan Excess
Benefit Plan Account shall vest at the same time(s) in the same manner, and
to the same extent as the Participant's account under the Profit-Sharing Plan.
Section 3.04. Payment of Profit-Sharing Excess Benefit Account.
The Profit-Sharing Plan Excess Benefit Account of a Participant shall, to the
extent vested, be paid to the Participant, or to the Beneficiary of such
Participant in the event of his death before receipt of all benefits to which
he is entitled hereunder in respect of his Profit-Sharing Plan Excess Benefit
Plan Account [in annual installments over a five-year period beginning as of
the first date benefits are payable to a Participant or Beneficiary under the
Profit-Sharing Plan. The amount of each installment shall be determined by
multiplying the value of the amount of the Profit-Sharing Plan Excess Benefit
Account to be distributed by a fraction, the numerator of which is one and
the denominator of which is the total number of installments remaining to be
paid.]
ARTICLE IV
Thrift Plan Benefits
Section 4.01. Accounts. The Company shall maintain a Thrift Plan
Excess Benefit Account on its books for each Participant whose annual
additions to the Thrift Plan have been (or would have been, but for the
application of Sections 401(k), 401(m), and 402(g) of the Code) restricted by
the limitations of Section 401(a)(17) of the Code.
Section 4.02. Deferrals and Allocations to Accounts. A Participant
may elect to reduce his Excess Compensation for a Thrift Plan 401(a)(17)
Limitation Measuring Period by an amount not in excess of the amount
determined for each period by the Company, and such amount shall be credited
to the Participant's Thrift Plan Excess Benefit Account. Any such election
shall be in writing on a form provided therefor by the Company, shall be
irrevocable and shall be delivered to the Company prior the first day of the
Thrift Plan 401(a)(17) Limitation Measuring Period to which it relates.
Notwithstanding the immediately preceding sentence, such election may be
delivered during the Thrift Plan 401(a)(17) Limitation Measuring Period in
which an employee first becomes a Participant with respect to the Thrift
Plan, but with respect only to Excess Compensation attributable to services
performed subsequent to delivery of the election, provided that the
Participant delivers the election to the Company within 30 days after his
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designation of eligibility to become a Participant. There shall also be
credited to such Participant's Thrift Plan Excess Benefit Account an amount
equal to the Employer Contributions that would have been made to the Thrift
Plan with respect to the Participant's compensation reductions under this
Section 4.02 if such reductions (to the extent of 6% of the Participant's
Excess Compensation) had been Matched Salary Deferral Contributions under the
Thrift Plan and the Thrift Plan contained no limitation with respect to
Section 401(a)(17) of the Code, Section 415 of the Code, Section 402(g) of
the Code, Section 401(k) of the Code, and Section 401(m) of the Code, to the
extent that the Participant has not received from the Thrift Plan or
otherwise a payment in respect of the limitation under the Code. In
accordance with rules established by the Company, compensation deferred by a
Participant under the ALLTEL Corporation Executive Deferred Compensation
Plan, the ALLTEL Corporation Performance Incentive Compensation Plan, and the
ALLTEL Corporation Long-Term Performance Incentive Plan may be taken into
account as compensation reductions for purposes only of determining credits
to the Participant's Thrift Plan Excess Benefit Plan Account under the
immediately preceding sentence. Credits to a Participant's Thrift Plan
Excess Benefit Account under this Section 4.02 shall occur at the same
time(s) and in the same manner as such credits would have been made to the
appropriate accounts under the Thrift Plan if the amount(s) of such credits
had been Salary Deferral Contributions under the Thrift Plan or Employer
Contributions under the Thrift Plan, as applicable.
Section 4.03. Gain (Loss) Adjustments. As of the last day of each
valuation period of the Profit-Sharing Plan preceding the date as of which
the Thrift Plan Excess Benefit Account is paid pursuant to Section 4.05, the
balance of each Participant's Thrift Plan Excess Benefit Account, less the
amount of any credits under Section 4.02 occurring as of any date within such
valuation period, shall be credited with gain (or debited with loss) equal to
the gain (or loss) the balance (minus the credits) would have experienced had
it been invested in the Trust Fund of the Profit-Sharing Plan at the same
time(s) and in the same manner as an employer contribution account under the
Profit-Sharing Plan.
Section 4.04. Vesting. A Participant's Thrift Plan Excess Benefit
Plan Account attributable to credits with respect to Employer Contributions
shall vest in accordance with the vesting provisions of the Thrift Plan. A
Participant's Thrift Plan Excess Benefit Plan Account attributable to his
Excess Compensation reductions under the Plan shall be fully vested.
Section 4.05. Payment of Thrift Plan Excess Benefit Account. The
Thrift Plan Excess Benefit Account of a Participant shall, to the extent
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vested, be paid to the Participant, or to the Beneficiary of such Participant
in the event of his death before receipt of all benefits to which he is
entitled hereunder in respect of his Thrift Plan Excess Benefit Plan Account
in a single lump sum payment as of the first date following the Participant's
termination of employment covered by the Profit-Sharing Plan on which
benefits are payable to the Participant or Beneficiary under the
Profit-Sharing Plan.
ARTICLE V
Retirement and Spousal Death Benefits
Section 5.01. Eligibility. A Participant who is entitled to a
vested Pension under the Pension Plan shall be eligible for a retirement
benefit under this Article V as hereinafter provided. A Spouse who is
entitled to a vested Qualified Preretirement Survivor Annuity under the
Pension Plan shall be eligible for a Spouse death benefit under this
Article V as hereinafter provided.
Section 5.02. Amount of Retirement Benefit. The retirement benefit
payable under the Plan to a Participant who is eligible therefor shall be
determined as follows:
(i) the regular Pension (on a single-life-only
basis payable commencing at the later of age 65 or the
Participant's Retirement) that the Participant would
receive under the Pension Plan if the Pension Plan were not
subject to (and contained no provisions with respect to)
Section 415 of the Code or Section 401(a)(17) of the Code;
reduced by -
(ii) the regular Pension payable to the
Participant (on a single-life-only basis payable commencing
at the later of age 65 or the Participant's Retirement,
regardless of the actual form of payment or timing of
commencement of payment) under the Pension Plan,
determined, if the Participant has not attained his Social
Security Retirement Age on the date the retirement benefit
under the Plan is to commence, according to a projection
based upon the advice of the Actuary of the cost-of-living
increase(s) in the limitation under Section 415 of the Code
expected to have become effective as of the date the
Participant would attain his Social Security Retirement Age;
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and, if applicable, further reduced by -
(iii) if the Participant has not attained age 65
on the date the retirement benefit under the Plan is to
commence, the amount of the retirement benefit shall be
reduced for commencement prior to age 65 to the same extent
(if any) that the Participant's Pension under the Pension
Plan would have been reduced for commencement prior to age
65 if it had commenced as of the date the retirement
benefit under the Plan commenced.
Section 5.03. Amount of Spouse Death Benefit. The Spouse death
benefit payable under the Plan to a Spouse who is eligible therefor shall be
determined as follows:
(i) the Qualified Preretirement Survivor Annuity
that such Spouse would receive under the Pension Plan based
on the regular Pension (on a single-life-only basis payable
commencing at the later of age 65 or the Participant's
death) the Participant with respect to whom the Spouse
death benefit is payable would have received if the Pension
Plan were not subject to (and contained no provisions with
respect to) Section 415 of the Code or Section 401(a)(17)
of the Code;
reduced by -
(ii) the Qualified Preretirement Survivor Annuity
payable to such Spouse under the Pension Plan (regardless
of the actual form of payment or timing of commencement of
payment), based on the regular Pension (on a single-life-only basis
payable commencing at the later of age 65 or the Participant's death)
the Participant with respect to whom the Spouse death benefit is
payable would have received, determined, if the Participant had not
attained or would not if he had survived have attained his
Social Security Retirement Age on the date the death
benefit under the Plan is to commence, according to a
projection based upon the advice of the Actuary of the
cost-of living increase(s) in the limitation under Section
415 of the Code expected to have become effective as of the
date the Participant would have attained his Social
Security Retirement Age;
and, if applicable, further reduced by -
(iii) if the Participant with respect to whom the
Spouse death benefit is payable had not attained or would
not if he had survived have attained age 65 on the date the
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Spouse death benefit under the Plan is to commence, the
Spouse death benefit shall be reduced for commencement
prior to age 65 to the same extent (if any) that the
Qualified Preretirement Survivor Annuity under the Pension
Plan would have been reduced for commencement prior to the
Participant's age 65 if it had commenced as of the date the
death benefit under the Plan commenced.
Section 5.04. Vesting. The benefits under this Article V shall
vest at the same time(s), in the same manner, and to the same extent as the
Participant's Accrued Pension under the Pension Plan.
Section 5.05. Form of Payment. The form of payment of the
retirement benefit or Spouse death benefit as determined under this Article V
shall be a monthly amount payable monthly as of the first day of each month
for the life only of the retired Participant or Spouse, as applicable, except
that, if a Participant receives his Pension benefit under the Pension Plan
commencing as of the same date as the commencement date of his retirement
benefit hereunder, and in a form of payment other than a single-life-annuity
(for the Participant's life), the Committee may, in its sole discretion
exercised on or before the date the first payment thereof is made, direct
that the retired Participant's retirement benefit under the Plan be paid in
the form in which the retired Participant's retirement benefit under the
Pension Plan is paid, in which case the amounts payable under the Plan in the
alternative form of payment shall be the Actuarial Equivalent of the normal
form of payment under the Plan.
Section 5.06. Time of Payment. Payment of a Participant's
retirement benefit under the Plan shall commence as of the first day of the
first month for which the Participant is eligible to commence his Pension
under the Pension Plan. Any Spouse death benefit under the Plan shall
commence as of the first day of the calendar month next following the later
of the calendar month in which the Participant's death occurs or the calendar
month in which the Spouse could elect to receive a Qualified Preretirement
Survivor Annuity under the Pension Plan.
Section 5.07. Adjustments to Benefits. Notwithstanding any other
provision of the Plan to the contrary:
(i) If the amount of a Participant's Pension or a
Spouse's Qualified Preretirement Survivor Annuity payable
under the Pension Plan increases subsequent to the
computation of or commencement of payment of the retirement
benefit or Spouse death benefit under the Plan -- by reason
of an increase or increases in the limitation under
Section 415 of the Code that were not projected to occur
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pursuant to clause (iii) of Section 5.02 or clause (ii) of
Section 5.03, whichever applies; by reason of commencement
of the Participant's Pension or the Spouse's Qualified
Preretirement Survivor Annuity under the Pension Plan as of
a date later than the commencement of the Participant's
retirement benefit or Spouse's death benefit under the
Plan; or by reason of payment of the Participant's Pension
under the Pension Plan in a form part or all of which is
not subject to the limitations of Section 415 of the Code
-- the Participant's retirement benefit or Spouse death
benefit under the Plan shall be reduced prospectively, and
retroactively if a prospective reduction is not sufficient
to reflect fully such increase(s), from the effective
date(s) of such increase(s) by the Actuarial Equivalent of
such increase(s).
(ii) To the extent that an increase or increases
in the limitation under Section 415 of the Code projected
to occur pursuant to clause (ii) of Section 5.02 or
clause (ii) of Section 5.03, whichever applies, does not or
do not occur, the Participant's retirement benefit or
Spouse death benefit under the Plan shall be increased
prospectively, and retroactively if a prospective increase
is not sufficient to reflect fully the non-occurrence of
such increase(s), by the Actuarial Equivalent of such
increase(s) that did not occur.
(iii) To the extent that a Participant could not
receive on a current basis the full amount of his Pension
or a Spouse could not receive on a current basis the full
amount of Qualified Preretirement Survivor Annuity payable
under the Pension Plan because of the reduction under the
limitation of Section 415 of the Code for commencement of
the benefit thereunder prior to the Participant's Social
Security Retirement Age, the Participant's retirement
benefit under the Plan or Spouse death benefit under the
Plan shall be increased prospectively, and retroactively if
a prospective increase is not sufficient to reflect fully
such reduction in the limitation of Section 415 of the
Code, by the Actuarial Equivalent of such reduction in the
limitation of Section 415 of the Code.
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ARTICLE VI
Administration
Section 6.01. Plan Administrator. The Plan Administrator shall be
the Company, except that, any discretionary determination provided for in the
Plan with respect to the timing, amount, or form of a Participant's benefit
under the Plan shall be made by the Committee. The Plan Administrator may
retain auditors, accountants, legal counsel and actuarial counsel selected by
it. Any person authorized to act on behalf of the Plan Administrator may act
in any such capacity, and any such auditors, accountants, legal counsel and
actuarial counsel may be persons acting in a similar capacity for one or more
members of the Controlled Group and may be employees of one or more members
of the Controlled Group. The opinion of any such auditor, accountant, legal
counsel or actuarial counsel shall be full and complete authority and
protection in respect to any action taken, suffered or omitted by any person
authorized to act on behalf of the Plan Administrator in good faith and in
accordance with such opinion. Notwithstanding the foregoing, no person shall
vote or take action on a matter solely with respect to his own Plan benefit.
Section 6.02. Expenses. The Company shall pay all expenses
incurred in the administration of the Plan.
Section 6.03. Records. The Company shall keep such records as
shall be proper, necessary or desirable to effectuate the purposes of the
Plan, including, without in any manner limiting the generality of the
foregoing, records and information with respect to the benefits granted to
Participants, dates of employment and determinations made hereunder.
Section 6.04. Legal Incompetency. The Plan Administrator may, in
its discretion, make or cause to be made payment either directly to an
incompetent or disabled person, or to the guardian of such person, or to the
person having custody of such person, without further liability on the part
of the Company, any member of the Controlled Group, the Plan Administrator,
or any person, for the amounts of such payment to the person on whose account
such payment is made.
Section 6.05. Claims Procedure. The claims procedures provisions
of the Profit-Sharing Plan, Thrift Plan, and the Pension Plan are
incorporated herein by reference and shall apply to benefits under
Article III, Article IV, and Article V, respectively, of the Plan.
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ARTICLE VII
Miscellaneous
Section 7.01. Amendments. The Board from time to time may amend,
suspend, or terminate, in whole or in part, any or all of the provisions of
the Plan, effective prospectively or retroactively, except that no such
action shall permit a Participant to elect to defer the receipt of
compensation with respect to services performed prior to such action or an
election to defer, nor shall any such action shall adversely affect the
rights of any Participant to or the operation of the Plan with respect to any
benefits that have accrued prior to such action.
Section 7.02. No Employment Rights. Neither the establishment or
maintenance of the Plan nor the status of an employee as a Participant shall
give any Participant any right to be retained in employment; and no
Participant and no person claiming under or through such Participant shall
have any right or interest in any benefit under the Plan unless and until the
terms, conditions and provisions of the Plan affecting such Participant shall
have been satisfied.
Section 7.03. Nonalienation. The right of any Participant or any
person claiming under or through a Participant to any benefit or any payment
hereunder shall not be subject in any manner to attachment or other legal
process for the debts of the Participant or person; and the same shall not be
subject to anticipation, alienation, sale, transfer, assignment or
encumbrance.
Section 7.04. Limitation of Liability. No member of the Board and
no officer or employee of any member of the Controlled Group shall be liable
to any person for any action taken or omitted in connection with this Plan,
nor shall any member of the Controlled Group be liable to any person for any
such action or omission. No person shall, because of the Plan, acquire any
right to an accounting or to examine the books or the affairs of any member
of a Controlled Group. Nothing in the Plan shall be construed to create any
trust or fiduciary relationship between any member of the Controlled Group
and any Participant or any other person.
Section 7.05. Acceleration of Payment. The Committee in its sole
discretion may accelerate the time of payment of any benefit under the Plan
to the extent that it deems it equitable or desirable under the
circumstances. Any accelerated payment of a benefit (or portion of a
benefit) under Article V shall be in a single sum payment that is the
Actuarial Equivalent of the benefit (or portion of a benefit) the payment of
which is being accelerated.
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Section 7.06. Representative of Board. The Board may from time to
time designate an individual or committee to carry out any duties or
responsibilities of the Board hereunder.
Section 7.07. Designation of Beneficiary. Each Participant may in
the manner prescribed by the Company designate a Beneficiary in writing to
receive any and all payments to which he may be entitled under Article III
and/or Article IV of the Plan upon his death. If a Participant fails to
designate a Beneficiary in writing in the manner prescribed by the Company,
any benefits remaining unpaid at his death shall be paid to his surviving
Spouse and if there is no surviving Spouse to the executor or other personal
representative of the Participant to be distributed in accordance with the
Participant's will or applicable law.
Section 7.08. Reemployment of a Participant. In the event of the
reemployment as an employee in any capacity by the Company or a member of the
Controlled Group of a Participant whose employment covered under the Plan has
terminated, payment of his benefits under the Plan shall be suspended during
his period of reemployment to the same extent as payment of his benefits
under the Profit-Sharing Plan, the Thrift Plan, the Pension Plan, as
applicable, are suspended. The Participant shall accrue additional credit
for purposes of increasing his benefits under the Plan with respect to his
reemployment period only if he again becomes a Participant as provided in
paragraph (g) of Section 2.01.
ARTICLE VIII
Merger of Certain Plans Into the Plan
Section 8.01. General. Effective as of the beginning of business
on January 1, 1996 (the "Merger Date"), the Systematics Information Services,
Inc. Excess Benefit Plan (the "Systematics Excess Benefit Plan") and the
Computer Power, Inc. Excess Benefit Plan (the "CPI Excess Benefit Plan")
shall be merged into the Plan and "Participants" in the Systematics Excess
Benefit Plan and the CPI Excess Benefit Plan (as defined therein) as of the
close of business on December 31, 1995 shall (to the extent not already
Participants) become Participants in the Plan. On and after the Merger Date,
except as otherwise provided in this Article VIII, the general provisions of
the Plan shall govern with respect to amounts credited immediately prior to
the Merger Date under the Systematics Excess Benefit Plan and the Computer
Power, Inc. Excess Benefit Plan. Notwithstanding any other provision of the
Plan (including this Article VIII) to the contrary, in no event shall the
merger provided for in this Article VIII result in any duplication of
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benefits with respect to the Systematics Excess Benefit Plan, the CPI Excess
Benefit Plan, and the Plan.
Section 8.02. Merger of Systematics Information Services Inc. Excess
Benefit Plan. Effective as of the Merger Date, the book reserve accounts
under the Systematics Excess Benefit Plan shall be maintained as book reserve
accounts under the Plan:
(a) Amounts credited immediately prior to the Merger Date to a
Participant's "Profit-Sharing Excess Benefit Account" under
Article III of the Systematics Excess Benefit Plan shall be
maintained on and after the Merger Date in accordance with
Article III of the Plan.
(b) Amounts credited immediately prior to the Merger Date to a
Participant's Thrift Plan Excess Benefit Account under Article III
of the Systematics Excess Benefit Plan shall be maintained on and
after the Merger Date in accordance with Article IV of the Plan.
(c) Notwithstanding Section 3.04 of the Plan, amounts credited to a
Participant's Profit-Sharing Excess Benefit Account attributable to
the Systematics Excess Benefit Plan shall, to the extent vested, be
paid to the Participant, or to the Beneficiary of such Participant
in the event of his death before receipt of all benefits to which he
is entitled hereunder in respect of his Profit-Sharing Excess
Benefit Account attributable to the Systematics Excess Benefit Plan,
in a single lump sum payment as of the first date following the
Participant's termination of employment covered by the
Profit-Sharing Plan on which benefits are payable to the Participant
or Beneficiary under the Profit-Sharing Plan.
Section 8.03. Merger of Computer Power, Inc. Excess Benefit Plan.
Effective as of the Merger Date, the book reserve accounts under the CPI
Excess Benefit Plan shall be maintained as book reserve accounts under the
Plan:
(a) Amounts credited to a Participant's "Employer Contribution
Excess Benefit Account" maintained under Article III of the CPI
Excess Benefit Plan immediately prior to the Merger Date shall be
maintained on and after the Merger Date in accordance with
Article III of the Plan.
(b) Amounts credited to a Participant's "Salary Deferral Excess
Benefit Account" maintained under Article IV of the CPI Excess
Benefit Plan immediately prior to the Merger Date shall be
maintained on and after the Merger Date in accordance with
Article IV of the Plan.
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(c) Notwithstanding Sections 3.03 and 3.04 of the Plan, amounts
credited to a Participant's Profit-Sharing Excess Benefit Account
attributable to the CPI Excess Benefit Plan shall be fully vested
and shall be paid to the Participant, or to the Beneficiary of such
Participant in the event of his death before receipt of all benefits
to which he is entitled hereunder in respect of his Profit-Sharing
Excess Benefit Account attributable to the CPI Excess Benefit Plan,
in a single lump sum payment as of the first date following the
Participant's termination of employment covered by the
Profit-Sharing Plan on which benefits are payable to the Participant
or Beneficiary under the Profit-Sharing Plan.
(d) Notwithstanding the merger of the CPI Excess Benefit Plan into
the Plan, the "Company" as defined in the CPI Excess Benefit Plan as
in effect immediately prior to the Merger Date shall remain liable
for payment of benefits, if any, attributable to the CPI Excess Plan.
IN WITNESS WHEREOF, ALLTEL CORPORATION has caused this Plan to be
executed as of this 27th day of October, 1995.
ALLTEL CORPORATION
By /S/ John L. Comparin
Title: V.P. Human Resources
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Exhibit 10(o)(2)
AMENDMENT NO. 3
TO
ALLTEL CORPORATION THRIFT PLAN
(January 1, 1994 Restatement)
WHEREAS, ALLTEL Corporation (the "Company") maintains the
ALLTEL Corporation Thrift Plan, as amended and restated effective
January 1, 1994, and subsequently further amended, (the "Plan"); and
WHEREAS, the Company desires further to amend the Plan;
NOW THEREFORE, BE IT RESOLVED, that the Company hereby amends
the Plan in the respects hereinafter set forth:
1. Effective as of the Effective Date, as Effective Date is
defined in the Employee Transfer Agreement between Citizens Utilities Company
of Pennsylvania, a Pennsylvania corporation, and Tuolumne Telephone Company,
dated November 28, 1994, but contingent upon consummation (as determined by the
Company and communicated in writing to the Committee), of the transactions
contemplated by the Employee Transfer Agreement, by adding immediately
following Article XXII thereof, the following new Article XXIII:
ARTICLE XXIII
TRANSFER OF BENEFITS TO THE PLAN WITH RESPECT TO
CERTAIN FORMER EMPLOYEES OF
CITIZENS UTILITIES COMPANY OF PENNSYLVANIA
23.1 Definitions
For purposes of this Article XXIII, the following definitions shall apply:
(a) "Citizens" shall mean Citizens Utilities Company of Pennsylvania, a
Pennsylvania corporation.
(b) The "Effective Date" shall mean the Effective Date as defined in the
Employee Transfer Agreement.
(c) The "Employee Transfer Agreement" shall mean the Employee Transfer
Agreement between Citizens Utilities Company, a Pennsylvania
corporation, and Tuolumne Telephone Company, dated November 28, 1994.
146
<PAGE>
(d) The "Transfer Accounts" shall mean the accounts transferred to the
Plan from the Transfer Plan in accordance with the provisions of the
Transfer Agreement.
(e) A "Transfer Employee" shall mean an active employee (including an
employee on military leave, maternity leave, or other approved leaves
of absence of 12 months or less, short-term disability, and an
employee on layoff with recall rights) whose employment transfers
pursuant to the Transfer Agreement from Citizens or one of its
affiliates to an Employer, as of the Effective Date, and who elects
to have his separate account under a Transfer Plan transferred to
the Plan.
(f) A "Transfer Plan" shall mean such one or more qualified plans as
may be designated by Citizens.
23.2 Transfer of Accounts
The Company shall direct the Trustee to accept the Transfer Accounts from
the trustee(s) of the Transfer Plans, in accordance with the provisions of
the Employee Transfer Agreement, to be held, administered, and disposed
of by the Trustee, under the terms, conditions, and provisions of the
Plan. Except as otherwise expressly provided in this Article XXIII, the
general provisions of the Plan shall govern with respect to the Transfer
Accounts, to the extent not inconsistent with any provision of a Transfer
Plan that may not be eliminated under Section 411(d)(6) of the Code.
23.3 Establishment of Accounts
As of the Effective Date, Separate Accounts shall be established in
accordance with the provisions of Section 11.04 in the name of each
Transfer Employee. In addition to any credits or debits to the Separate
Account of the Transfer Employees on or after the Effective Date, in
accordance with the Plan's general provisions, as of the date the Transfer
Accounts are received by the Trustee and deposited in the Trust Fund there
shall be credited to each such Separate Account or Sub-Account, as
applicable, the value of such Transfer Employee's prior separate account
or sub-account of the corresponding type under the Transfer Plan as
certified to the Plan Administrator by the plan administrator of the
Transfer Plan.
23.4 Elections, Waivers, and Beneficiary Designations
Provided that an election, waiver, or beneficiary designation has not
become irrevocable (by reason of death or otherwise), the provisions of
the Plan with respect to elections, waivers, and beneficiary designations
shall apply to the Transfer Accounts.
2
147
<PAGE>
23.5 Outstanding Loans
Notwithstanding any other provision of the Plan to the contrary, any
outstanding loan of a Transfer Employee under the Transfer Plan shall be
repaid under the Plan by payroll deduction and otherwise continue to be
administered in accordance with its terms and the applicable provisions of
the Transfer Plan in effect at the time the loan was granted.
23.6 Vested Interest of Transfer Employees
Each Transfer Employee shall be 100% vested in the entire balance of his
separate account transferred to the Plan from a Transfer Plan.
23.7 Overriding Provisions
The provisions of this Article XXIII shall apply notwithstanding any other
provisions of the Plan, except Section 3.07, and shall override any
conflicting Plan provisions.
2. Effective as of the Effective Date, as Effective Date is defined
in the Employee Transfer Agreement between Citizens Utilities Company and
Systematics Telecommunications Services, Inc., dated February 13, 1995, but
contingent upon consummation (as determined by the Company and communicated in
writing to the Committee), of the transactions contemplated by the Employee
Transfer Agreement, by adding immediately following Article XXIII thereof, the
following new Article XXIV:
ARTICLE XXIV
TRANSFER OF BENEFITS TO THE PLAN WITH RESPECT TO
CERTAIN FORMER EMPLOYEES OF
CITIZENS UTILITIES COMPANY
24.1 Definitions
For purposes of this Article XXIV, the following definitions shall apply:
(a) "Citizens" shall mean Citizens Utilities Company.
(b) The "Effective Date" shall mean the Effective Date as defined in
the Employee Transfer Agreement.
(c) The "Employee Transfer Agreement" shall mean the Employee Transfer
Agreement between Citizens Utilities Company and Systematics
Telecommunications Services, Inc., dated February 13, 1995.
3
148
<PAGE>
(d) The "Transfer Accounts" shall mean the accounts transferred to the
Plan from the Transfer Plan in accordance with the provisions of
the Transfer Agreement.
(e) A "Transfer Employee" shall mean an active employee listed on
Attachment A to the Transfer Agreement whose employment transfers
pursuant to the Transfer Agreement from Citizens to an Employer, as
of the Effective Date, and who elects to have his separate account
under a Transfer Plan transferred to the Plan.
(f) A "Transfer Plan" shall mean such one or more qualified plans as may
be designated by Citizens.
24.2 Transfer of Accounts
The Company shall direct the Trustee to accept the Transfer Accounts from
the trustee(s) of the Transfer Plans, in accordance with the provisions of
the Employee Transfer Agreement, to be held, administered, and disposed of
by the Trustee, under the terms, conditions, and provisions of the
Plan. Except as otherwise expressly provided in this Article XXIV, the
general provisions of the Plan shall govern with respect to the Transfer
Accounts, to the extent not inconsistent with any provision of a Transfer
Plan that may not be eliminated under Section 411(d)(6) of the Code.
24.3 Establishment of Accounts
As of the Effective Date, Separate Accounts shall be established in
accordance with the provisions of Section 11.08 in the name of each
Transfer Employee. In addition to any credits or debits to the Separate
Account of the Transfer Employees on or after the Effective Date, in
accordance with the Plan's general provisions, as of the date the
Transfer Accounts are received by the Trustee and deposited in the Trust
Fund there shall be credited to each such Separate Account or Sub-Account,
as applicable, the value of such Transfer Employee's prior separate
account or sub-account of the corresponding type under the Transfer
Plan as certified to the Plan Administrator by the plan administrator of
the Transfer Plan.
24.4 Elections, Waivers, and Beneficiary Designations
Provided that an election, waiver, or beneficiary designation has not
become irrevocable (by reason of death or otherwise), the provisions of
the Plan with respect to elections, waivers, and beneficiary designations
shall apply to the Transfer Accounts.
4
149
<PAGE>
24.5 Outstanding Loans
Notwithstanding any other provision of the Plan to the contrary, any
outstanding loan of a Transfer Employee under the Transfer Plan shall be
repaid under the Plan by payroll deduction and otherwise continue to be
administered in accordance with its terms and the applicable provisions of
the Transfer Plan in effect at the time the loan was granted.
24.6 Vested Interest of Transfer Employees
Each Transfer Employee shall be 100% vested in the entire balance of his
separate account transferred to the Plan from a Transfer Plan.
24.7 Overriding Provisions
The provisions of this Article XXIV shall apply notwithstanding any other
provisions of the Plan, except Section 3.07, and shall override any
conflicting Plan provisions.
3. Effective as of the Closing Date, as Closing Date is defined
in the Asset Purchase Agreement among ALLTEL Financial Information Services,
Inc., FIserve, Inc., FIserve San Diego, Inc., and FIserve Boston, Inc., dated
August 17, 1995, but contingent upon consummation (as determined by the Company
and communicated in writing to the Committee), of the transactions contemplated
by the Asset Purchase Agreement, the Plan is amended by adding immediately
following Article XXIV thereof, the following new Article XXV:
ARTICLE XXV
TRANSFER OF BENEFITS WITH RESPECT TO
CERTAIN EMPLOYEES WHOSE EMPLOYMENT TRANSFERS TO
FISERVE, INC., FISERVE SAN DIEGO, INC. OR FISERVE BOSTON, INC.
25.1 Definitions
For purposes of this Article XXV, the following definitions shall apply:
(a) "FIserve" shall mean FIserve, Inc., FIserve San Diego, Inc. or
FIserve Boston, Inc., individually or collectively, as the context
may require.
(b) The "Closing Date" shall mean the Closing Date as defined in the
Asset Purchase Agreement.
(c) The "Asset Purchase Agreement" shall mean the Asset Purchase
Agreement among ALLTEL Financial Information Services, Inc.,
5
150
<PAGE>
FIserve, Inc., FIserve San Diego, Inc., and FIserve Boston, Inc.,
dated August 17, 1995.
(d) The "Transfer Assets" shall mean the amount or amounts directed by
the Company to be transferred to the Transfer Plan in accordance with
the provisions of the Asset Purchase Agreement.
(e) A "Transfer Employee" shall mean an active Employee whose employment
transfers from a Transferring Employer to FIserve as of the Closing
Date.
(f) The "Transfer Plan" shall mean the qualified plan designated by
FIserve.
(g) The "Transferring Employer" shall mean ALLTEL Financial Information
Services, Inc.
25.2 Transfer of Assets
The Company shall direct the Trustee to transfer the Transfer Assets to
the trustee(s) or funding agent(s) for the Transfer Plan, in accordance
with the provisions of the Asset Purchase Agreement, to be held,
administered, and disposed of by the trustee(s) of the Transfer Plan,
under the terms, conditions, and provisions of the Transfer Plan.
25.3 Benefit Payments After the Closing Date but Prior to the Transfer of
Assets
If, on or after the Closing Date and before the actual transfer of assets,
benefits become payable under the Plan with respect to a Transfer
Employee, the benefits shall be paid from the Plan and the assets and
liabilities for benefits to be transferred pursuant to Section 25.2 shall
be reduced accordingly.
25.4 Cessation of Participation
Effective as of the Closing Date, a Transfer Employee shall cease to be a
Participant in the Plan, and no Transfer Employee or any person claiming
under or through any Transfer Employee shall have any benefits or rights
under the Plan after the Closing Date (except as provided in
Section 25.3).
25.5 Vested Interest of Transfer Employees
The entire Separate Account of each Transfer Employee shall be
transferred to the Transfer Plan, as designated by FIserve. The vested
interest of each Transfer Employee in the Transfer Plan shall be
determined under the provisions of the Transfer Plan, but in no event
shall such vested interest be less than the Transfer Employee's vested
interest under the Plan as of the Closing Date.
6
151
<PAGE>
25.6 Plan Continuing
The Transfer Plan shall be deemed to be a continuation of the Plan with
respect to the Transfer Employees, and the transfer of assets to the
Transfer Plan shall not be deemed a termination or partial termination of
the Plan with respect to the Transfer Employees or otherwise.
25.7 Overriding Provisions
The provisions of this Article XXV shall apply notwithstanding any other
provisions of the Plan, except Section 3.07, and shall override any
conflicting Plan provisions.
4. Effective as set forth therein, the Plan is amended by adding
immediately following Section 20.04 a new Section 20.05 to provide as follows:
20.05 Merger of Vertex Business Systems, Inc. 401(k) Employee Savings Plan
(a) Effective as of the beginning of business on January 1, 1996, or
such other date as may be established by the Plan Administrator, (the
"Merger Date") the Vertex Business Systems, Inc. 401(k) Employee
Savings Plan (the "Vertex Plan") shall be merged into and made a
part of the Plan, and the trust fund maintained in connection with
the Vertex Plan shall be added to the assets of the Trust Fund to be
disposed of under the terms, conditions, and provisions of the Plan
and the Trust. On and after the Merger Date, except as otherwise
expressly provided in this Article XX, the general provisions of the
Plan shall govern with respect to the interests under the Vertex
Plan of all persons, to the extent not inconsistent with any
provision of the Vertex Plan that may not be eliminated under Section
411(d)(6) of the Code.
(b) As of the Merger Date, Separate Accounts shall be established in
accordance with the provisions of Section 11.08 in the name of each
person who as of the close of business on the day immediately
preceding the Merger Date, was a participant or beneficiary with an
interest under the Vertex Plan. In addition to any credits or debits
to the Separate Account of the persons described in the immediately
preceding sentence on or after the Merger Date in accordance with
the Plan's general provisions, as of the date the assets of
the trust fund for the Vertex Plan are received by the Trustee and
deposited in the Trust Fund there shall be credited to each such
Separate Account or Sub-Account, as applicable, the value of such
person's prior separate account or sub-account of the corresponding
type under the Vertex Plan as certified to the Plan Administrator
by the plan administrator of the Vertex Plan.
7
152
<PAGE>
(c) Notwithstanding any other provision of the Plan to the contrary, any
outstanding loan under the Vertex Plan shall continue to be repaid
and administered in accordance with its terms and the applicable
provisions of the Vertex Plan in effect at the time the loan was
granted.
6. Effective as of the date of execution hereof, the first sentence
of Section 3.04 is amended to provide as follows:
If any person to whom a benefit under the Plan is payable is unable to
care for his affairs because of illness or accident or legal incompetence,
any payment due may be paid, in the discretion of the Plan Administrator,
to the Spouse, child, brother or sister of such person, or to any other
persons deemed by the Plan Administrator to be maintaining or responsible
for the maintenance of such person (unless prior claim therefor shall have
been made by a duly qualified guardian or other legal representative).
6. Effective as if set forth in the January 1, 1994 Restatement
when originally executed, the first sentence of Section 12.08 is amended to
provide as follows:
Subject to the approval of the Plan Administrator, an Eligible Employee
who was a participant in a plan qualified under Section 401 of the Code
and who receives a cash distribution from such plan that he elects either
(i) to roll over immediately to a qualified retirement plan or (ii)
to roll over into a conduit IRA from which he receives a later cash
distribution, may elect to make a Rollover Contribution to the Plan if he
is entitled under the Code to roll over such distribution to another
qualified retirement plan.
IN WITNESS WHEREOF, the Company, by its duly authorized officer,
has caused this Amendment to be executed on this 27th day of October, 1995.
ALLTEL CORPORATION
By: /s/ John L. Comparin
Title: V.P. Human Resources
153
Exhibit 24
Securities and Exchange Commission
Washington, D.C. 20549
Re: ALLTEL Corporation
Commission File No. 1-4996
1934 Act Filings on Form 10-K
Authorized Representatives
Gentlemen:
The above Company is the issuer of securities registered
under Section 12 of the Securities Exchange Act of 1934 (The "Act"). Each of
the persons signing his name below confirms, as of the date appearing
opposite his signature, that each of the "Authorized Representatives" named
below is authorized on his behalf to sign and submit to the Securities and
Exchange Commission such filings on Form 10-K as are required by the Act.
Each person so signing also confirms the authority of each of the Authorized
Representatives to do and perform on his behalf, any and all acts and things
requisite or necessary to assure compliance by the signing person with the
Form 10-K requirements. The authority confirmed herein shall remain in
effect as to each person signing his name below until such time as the
Commission shall receive from such person a written communication terminating
or modifying the authority. Each person signing his name below expressly
revokes all authority heretofore given or executed by him with respect to
such filings under the Act.
Authorized Representatives
Dennis J. Ferra
Tom T. Orsini
Francis X. Frantz
Date Date
/s/ William H. Zimmer 4/20/95 /s/ Dennis J. Ferra 5/24/95
/s/ Lawrence L. Gellerstedt III 4/20/95 /s/ Francis X. Frantz 5/24/95
/s/ Emon A. Mahoney 4/20/95 /s/ Tom T. Orsini 5/24/95
/s/ Carl H. Tiedemann 4/20/95
/s/ Joe Ford 4/20/95
/s/ John Steuri 4/20/95
/s/ Ben W. Agee 4/20/95
/s/ Ronald Townsend 4/20/95
/s/ John P. McConnell 4/20/95
/s/ W.W. Johnson 5/1/95
/s/ Michael D. Andreas 5/12/95
/s/ Josie Natori 5/21/95
154
<PAGE>
Securities and Exchange Commission
Washington, D.C. 20549
Re: ALLTEL Corporation
Commission File No. 1-4996
1934 Act Filings on Form 10-K
Authorized Representatives
Gentlemen:
The above Company is the issuer of securities registered
under Section 12 of the Securities Exchange Act of 1934 (The "Act"). Each of
the persons signing his name below confirms, as of the date appearing
opposite his signature, that each of the "Authorized Representatives" named
below is authorized on his behalf to sign and submit to the Securities and
Exchange Commission such filings on Form 10-K as are required by the Act.
Each person so signing also confirms the authority of each of the Authorized
Representatives to do and perform on his behalf, any and all acts and things
requisite or necessary to assure compliance by the signing person with the
Form 10-K requirements. The authority confirmed herein shall remain in
effect as to each person signing his name below until such time as the
Commission shall receive from such person a written communication terminating
or modifying the authority. Each person signing his name below expressly
revokes all authority heretofore given or executed by him with respect to
such filings under the Act.
Authorized Representatives
Dennis J. Ferra
Tom T. Orsini
Francis X. Frantz
Date
Scott T. Ford 2/9/96
155
<PAGE>
Securities and Exchange Commission
Washington, D.C. 20549
Re: ALLTEL Corporation
Commission File No. 1-4996
1934 Act Filings on Form 10-K
Authorized Representatives
Gentlemen:
The above Company is the issuer of securities registered
under Section 12 of the Securities Exchange Act of 1934 (The "Act"). Each of
the persons signing his name below confirms, as of the date appearing
opposite his signature, that each of the "Authorized Representatives" named
below is authorized on his behalf to sign and submit to the Securities and
Exchange Commission such filings on Form 10-K as are required by the Act.
Each person so signing also confirms the authority of each of the Authorized
Representatives to do and perform on his behalf, any and all acts and things
requisite or necessary to assure compliance by the signing person with the
Form 10-K requirements. The authority confirmed herein shall remain in
effect as to each person signing his name below until such time as the
Commission shall receive from such person a written communication terminating
or modifying the authority. Each person signing his name below expressly
revokes all authority heretofore given or executed by him with respect to
such filings under the Act.
Authorized Representatives
Dennis J. Ferra
Tom T. Orsini
Francis X. Frantz
Date
John Robert Belk 2/12/96
156
<PAGE>
Securities and Exchange Commission
Washington, D.C. 20549
Re: ALLTEL Corporation
Commission File No. 1-4996
1934 Act Filings on Form 10-K
Authorized Representatives
Gentlemen:
The above Company is the issuer of securities registered
under Section 12 of the Securities Exchange Act of 1934 (The "Act"). Each of
the persons signing his name below confirms, as of the date appearing
opposite his signature, that each of the "Authorized Representatives" named
below is authorized on his behalf to sign and submit to the Securities and
Exchange Commission such filings on Form 10-K as are required by the Act.
Each person so signing also confirms the authority of each of the Authorized
Representatives to do and perform on his behalf, any and all acts and things
requisite or necessary to assure compliance by the signing person with the
Form 10-K requirements. The authority confirmed herein shall remain in
effect as to each person signing his name below until such time as the
Commission shall receive from such person a written communication terminating
or modifying the authority. Each person signing his name below expressly
revokes all authority heretofore given or executed by him with respect to
such filings under the Act.
Authorized Representatives
Dennis J. Ferra
Tom T. Orsini
Francis X. Frantz
Date 2-5-96
John M. Mueller
157
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE ANNUAL REPORT TO STOCKHOLDERS AND IS QUALIFIED IN ITS
IN ITS ENTIRETY BY REFERENCE TO SUCH REPORT.
</LEGEND>
<CIK> 0000065873
<NAME> ALLTEL CORPORATION
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 21,421
<SECURITIES> 0
<RECEIVABLES> 582,797
<ALLOWANCES> 18,439
<INVENTORY> 89,667
<CURRENT-ASSETS> 731,241
<PP&E> 4,841,827
<DEPRECIATION> 1,869,075
<TOTAL-ASSETS> 5,073,105
<CURRENT-LIABILITIES> 569,284
<BONDS> 1,761,604
7,078
9,241
<COMMON> 189,268
<OTHER-SE> 1,737,056
<TOTAL-LIABILITY-AND-EQUITY> 5,073,105
<SALES> 667,899
<TOTAL-REVENUES> 3,109,725
<CGS> 449,119
<TOTAL-COSTS> 2,425,747
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 145,428
<INCOME-PRETAX> 571,806
<INCOME-TAX> 217,190
<INCOME-CONTINUING> 354,616
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 354,616
<EPS-PRIMARY> 1.86
<EPS-DILUTED> 0
</TABLE>
