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IMPORTANT [vertical sidebar reads:
MERGER MERGER INFORMATION]
INFORMATION
FOR
PARTICIPANTS
IN THE
AMERITECH
DIRECT
SERVICES
INVESTMENT
PLAN
Supplement, dated June 15, 1999, to the Ameritech
Prospectus, dated June 3, 1996, for the Ameritech Direct
Services Investment Plan
[Ameritech Logo]
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The following Important Merger Information describes the
effect of the proposed merger involving Ameritech
Corporation (Ameritech) and SBC Communications Inc. (SBC) on
the Ameritech Direct Services Investment Plan or ADSIP (the
Ameritech Plan). It supplements and amends Ameritech's
Prospectus, dated June 3, 1996, and the terms of the
Ameritech Plan.
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Ameritech and SBC are parties to an Agreement and Plan of
Merger (Merger Agreement) dated May 10, 1998. The Merger
Agreement provides for Ameritech to merge with an SBC
subsidiary (the Merger) and become a wholly owned subsidiary
of SBC. Upon completion of the Merger, each outstanding
share of Ameritech common stock would be converted into
1.316 shares of SBC common stock. The Merger is presently
expected to be completed during mid-1999, but remains
subject to regulatory approvals.
At the time the Merger becomes effective, the Ameritech Plan
will terminate and investment elections made for the
Ameritech Plan will automatically be transferred to and
governed by The DirectSERVICE[TM] Investment Program for
shareholders of SBC (the SBC Program), except as described
in this booklet. The enclosed Shareholder Information
Brochure, dated May 1999, describes the terms and conditions
of participation in, and the fees and commissions payable by
participants under, the SBC Program. Upon completion of the
Merger, the conversion to the SBC Program will be automatic,
except as described below.
Ameritech shareowners holding certificated shares, or a
combination of certificated and uncertificated shares in the
same account with identical registrations, will receive a
Letter of Transmittal from the Merger Exchange Agent, First
Chicago Trust Company of New York, shortly after the Merger.
If you are such a shareowner, you will need to send a
completed and signed Letter of Transmittal, together with
your stock certificates, to the Exchange Agent in order to
receive your SBC shares. When you complete the Letter of
Transmittal, you may elect to receive your new SBC shares in
either certificated or uncertificated form. Until your
completed Letter of Transmittal and Ameritech stock
certificates are returned to the Exchange Agent, dividend
payments will be withheld on the SBC shares you are entitled
to receive in the Merger exchange.
If your account has only uncertificated shares, those
uncertificated shares will be automatically exchanged for
uncertificated SBC shares, without further action on your
part.
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If you have more than one shareowner account, each account
will be treated separately.
We expect the Merger to be completed. However, if the Merger
is not completed, you will not become a participant in the
SBC Program, and your participation in the Ameritech Plan
will continue under its current terms and conditions.
The SBC Program
Some features of the SBC Program are summarized below. You
should carefully read the enclosed Shareholder Information
Brochure relating to the SBC Program, as some of the program
features, terms and conditions of the SBC Program, such as
fees and brokerage commissions, differ from those under the
Ameritech Plan.
o Nature of Program. The SBC Program is sponsored and
administered by First Chicago Trust Company of New
York, which also acts as SBC's transfer agent.
Investments made through the SBC Program are used to
purchase shares of SBC common stock in the open market
or in negotiated transactions.
Investment Features. SBC Program features include
full or partial reinvestment of dividends and
optional cash investments. You can make optional
cash investments under the SBC Program in a minimum
amount of $50, up to a total of $120,000 annually.
Uncertificated Shares. Under the SBC Program, all
whole shares acquired by dividend reinvestment
participants are registered directly in the form of
uncertificated shares. Uncertificated shares have the
same rights as certificated shares, but without the
risk of loss of the certificates. All fractional
shares acquired by participants are held by the Plan
Administrator on their behalf. Once a participant has
acquired a whole share, the share is registered in
the participant's name in uncertificated form. When
the participant discontinues the dividend
reinvestment election, the fractional share is sold
and the proceeds, after commissions and fees, are
distributed to the participant.
o Payroll Deductions. Employees who are reinvesting
dividends under the SBC Program and who wish to make
additional purchases of SBC common stock after the
Merger can use the "Optional Cash Investments" feature
to make such purchases. Employee payroll deductions are
not available under the SBC Program.
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o Beneficial Owners. Beneficial owners who hold their
shares in "street name" through brokers or other
nominees and who wish to participate directly in the
Ameritech Plan or the SBC Program must have their
shares re-registered in their own names.
o Loans. Stock secured loan and line of credit
arrangements in existence prior to completion of the
Merger will not be affected by the Merger or the
accompanying termination of the Ameritech Plan. There
is no loan feature through the SBC Program, but
participants may contact First Chicago Trust Company of
New York for information about the availability of loan
arrangements following the Merger.
For a more complete discussion of the SBC Program, including
applicable fees and commissions, please review the enclosed
SBC Program Shareholder Information Brochure. You should
contact the SBC Program Administrator (at the number listed
in the enclosed Shareholder Information Brochure) with any
questions you have about the SBC Program.
Terminating Participation in the Ameritech Plan Prior to the
Merger
If you are a shareowner of record and do not wish to have
your investment elections (including your dividend
reinvestment and optional cash investment elections)
automatically transferred from the Ameritech Plan to the SBC
Program after the Merger is completed, you should terminate
participation in the Ameritech Plan (and all related full or
partial dividend reinvestment elections) prior to the
Merger. Upon any such termination, in accordance with the
Ameritech Plan, any fractional share interest credited to
you will be cashed out, and you may maintain the whole
shares credited to your shareowner account in uncertificated
form or you may elect to receive a stock certificate for
those whole shares. Alternatively, you may ask the Ameritech
Plan Administrator to sell the uncertificated shares
credited to your account, and forward the sale proceeds,
after deducting applicable fees, commissions and
withholdings in accordance with the Ameritech Plan.
Your request to terminate your Ameritech Plan participation
can be made by contacting EquiServe - First Chicago Trust
Division, Ameritech's Transfer Agent and the Ameritech Plan
Administrator:
Phone: Toll free: 1-800-233-1342
Collect: 1-201-324-0308
By speaking to a customer service representative or
using the automated voice response system
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In Writing: AMERITECH
c/o EquiServe -
First Chicago Trust Division
P. O. Box 2558
Jersey City, NJ 07303-2558
Please include your shareowner account number and/or
social security number and a telephone number where
you can be reached during regular business hours.
Transition from the Ameritech Plan to the SBC Program
Conversion of Whole and Fractional Shares
Upon the closing of the Merger, each share of Ameritech
stock will be converted into 1.316 shares of SBC common
stock. Any resulting fractional share due a shareowner not
participating in dividend reinvestment will be converted to
cash.
If your election to reinvest full or partial dividends under
the Ameritech Plan is in effect at the time of the Merger,
then the Ameritech Plan provides that any fractional share
of SBC to which you would be entitled as a result of the
Merger exchange will not be cashed out, but will be
transferred to the SBC Program Administrator to hold on your
behalf. As you acquire a whole share of SBC common stock
through the reinvestment of dividends or any optional cash
investments, the whole share will be credited to you as an
uncertificated share. When you terminate your dividend
reinvestment election, your fractional share will be sold
and the proceeds, after deduction of applicable commissions
and fees, will be distributed to you.
Pending Sale of Shares
Under the Ameritech Plan, you may request that any
uncertificated Ameritech shares in your account be sold. If,
prior to the Merger, you request such a sale, and the Merger
is completed before your uncertificated Ameritech shares are
sold, the Ameritech Plan Administrator will send the request
to the Program Administrator under the SBC Program. Your
uncertificated Ameritech shares will be converted to
uncertificated SBC shares in accordance with the exchange
ratio provided in the Merger Agreement, and the Program
Administrator under the SBC Program will then sell the
uncertificated SBC shares in accordance with the terms of
and subject to any fees and commissions charged by the SBC
Program.
Pending Dividends on Your Ameritech Shares
If you remain in the Ameritech Plan (that is, you have
elected to reinvest all or part of your dividends), any
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cash dividends declared by Ameritech with a record date prior to,
but a payment date after, the Merger will be reinvested in
shares of SBC stock in accordance with the SBC Program.
These dividends will be treated by the Program Administrator
under the SBC Program as optional cash investments under the
SBC Program.
Pending Optional Cash Investments - Checks, Employee Payroll
Deductions, Automatic Withdrawals
Any optional cash investments received from Ameritech Plan
participants prior to the completion of the Merger that have
not been invested in shares of Ameritech stock in accordance
with the Ameritech Plan will be transferred to the SBC
Program, treated as an optional cash investment under the
SBC Program and used to purchase shares of SBC stock.
Questions and Answers
What do I need to do now?
1. Carefully read the enclosed Shareholder Information
Brochure regarding the SBC Program.
2. Decide whether or not you want your Ameritech Plan
investment elections to automatically transfer to the SBC
Program at the time the Merger is completed.
o If all of your shares are registered in your name and
you do nothing at this time, your full or partial
dividend reinvestment elections and optional cash
elections will be automatically transferred to the SBC
Program at the effective time of the Merger.
o If you don't want to join the SBC Program, then you must
terminate your dividend reinvestment elections in the
Ameritech Plan and discontinue participation in the
Ameritech Plan before completion of the Merger. Upon any
such termination, in accordance with the Ameritech Plan,
any fractional share interest credited to you will be
cashed out, and you may maintain the whole shares
credited to your shareowner account in uncertificated
form or you may elect to receive a stock certificate for
those whole shares. Alternatively, you may ask the
Ameritech Plan Administrator to sell the uncertificated
shares credited to your account, and forward the sale
proceeds, after deducting applicable fees, commissions
and withholdings in accordance with the Ameritech Plan.
3. Decide whether or not you want to convert Ameritech
certificates in your possession to uncertificated shares,
so that your Ameritech shares will be automatically
converted to uncertificated SBC shares following the Merger,
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without the need for any Letter of Transmittal
(see below). If you wish to do so, you should contact
Ameritech's transfer agent, EquiServe - First Chicago
Trust Division, at (800) 233-1342.
What will I need to do once the Merger becomes effective?
All Ameritech shareowners, whether or not participating in
the Ameritech Plan, who hold certificated shares, or a
combination of certificated and uncertificated shares with
the same registration, will receive a Letter of Transmittal
from the Exchange Agent promptly after the Merger closing.
If you are such a shareowner, you will need to complete and
sign the Letter of Transmittal and return it with your
Ameritech stock certificates. Your dividend reinvestment and
optional cash investment elections will be automatically
transferred to the SBC Program at the effective time of the
Merger. However, SBC dividends will be accrued and neither
reinvested in SBC stock through the SBC Program nor paid to
you (in the case of any partial dividend reinvestment
election) until you sign and return your completed Letter of
Transmittal along with your Ameritech stock certificates.
If all your Ameritech shares having the same account number
are uncertificated, you will not be required to complete a
Letter of Transmittal. All of those uncertificated Ameritech
shares will automatically be exchanged for uncertificated
SBC shares as a result of the Merger.
Can I consolidate my separate accounts from the Ameritech
Plan and the SBC Program after the Merger is completed?
If your registrations on both shareowner accounts are
identical, consolidation of such accounts after the Merger
may be requested by contacting First Chicago Trust Company
of New York.
What if the merger isn't completed?
No shares will be exchanged and you'll continue to be
enrolled in the Ameritech Plan without any changes.
How will the exchange affect my dividends?
Upon completion of the Merger, all outstanding Ameritech
common stock will be converted into SBC common stock.
Ameritech shareowners who receive SBC stock in the Merger
will be entitled to receive whatever future dividends the
Board of Directors of SBC, in its discretion, declares and
pays on such stock. For your information, the most recent
quarterly dividend amounts for the two companies were .3175
cents per share for Ameritech common stock and .24375 cents
per share for SBC common stock.
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Remember, in the Merger, you will receive 1.316 SBC shares
for each Ameritech share you own. Based on the most recent
dividend rates for Ameritech and SBC stock, adjusted for the
Merger exchange rate, this would result in a modest increase
in your total dividend.
Who do I contact if I have additional questions?
For questions regarding the Ameritech Plan, please call the
Ameritech Plan Administrator, at 1-800-233-1342.
For questions regarding the SBC Program, you should call the
SBC Program Administrator, at 1-800-351-7221. Please read
the enclosed SBC Shareholder Information Brochure for more
details on the terms and conditions of the SBC Program.
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