<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the fiscal year ended December 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the transition period from ___________________ to ___________________
Commission File Number 0-18195
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
U.S. LONG DISTANCE CORP.
9311 San Pedro, Suite 100
San Antonio, Texas 78216
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<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
INDEX TO FINANCIAL STATEMENTS
PAGE
----
Report of Independent Public Accountants 3
Statements of Net Assets Available for Plan Benefits at December 31,
1995 and 1996 4
Statements of Changes in Net Assets Available for Plan Benefits for
the Years Ended December 31, 1995 and 1996 5
Notes to Financial Statements 6
Fund Information:
Exhibit I Statements of Net Assets Available for Plan Benefits
with Fund Information at December 31, 1995 and 1996 11
Exhibit II Statements of Changes in Net Assets Available for
Plan Benefits with Fund Information for the Years
Ended December 31, 1995 and 1996 13
Supplemental Schedules:
Schedule I Item 27(a)- Schedule of Assets Held for Investment
Purposes at December 31, 1996 15
Schedule II Item 27(d)- Schedule of Reportable Transactions
for the Year Ended December 31, 1996 16
Signatures 17
2
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
TO THE TRUSTEES OF THE U.S. LONG DISTANCE CORP.
401(k) RETIREMENT PLAN:
We have audited the accompanying statements of net assets available for plan
benefits, including the schedule of investments, of the U.S. Long Distance Corp.
401(k) Retirement Plan as of December 31, 1995 and 1996, and the related
statements of changes in net assets available for plan benefits for the years
then ended. These financial statements and the schedules referred to below are
the responsibility of the Plan's management. Our responsibility is to express
an opinion on these financial statements and schedules 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 net assets available for plan benefits of the U.S.
Long Distance Corp. 401(k) Retirement Plan as of December 31, 1995 and 1996, and
the changes in its net assets available for plan benefits for the years then
ended, in conformity with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in the
index to financial statements are presented for purposes of additional analysis
and are not a required part of the basic financial statements but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The Fund Information in the statement of net assets
available for plan benefits and the statement of changes in net assets available
for plan benefits is presented for purposes of additional analysis rather than
to present the net assets available for plan benefits and changes in net assets
available for plan benefits of each fund. The supplemental schedules and Fund
Information have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
ARTHUR ANDERSEN LLP
San Antonio, Texas
June 6, 1997
3
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
ASSETS December 31,
- ------ ----------------------
1995 1996
---- ----
Investments at fair value:
Merrill Lynch Basic Value Fund $ 223,957 $ 335,921
Merrill Lynch Corporate Bond Fund 88,378 99,962
Merrill Lynch Global Allocation Fund 414,521 415,697
Merrill Lynch Growth Fund for Investment and Retirement 460,695 629,618
Merrill Lynch International Equity Fund - 42,377
Merrill Lynch Retirement Preservation Trust 148,405 190,846
U.S. Long Distance Corp. Common Stock 1,026,314 412,675
Billing Information Concepts Corp. Common Stock - 1,074,512
Participant Loans 9,714 21,000
Cash 1,725 1,725
Contributions receivable:
Employee 25,470 285
Employer 4,871 58
---------- ----------
Total assets 2,404,050 3,224,676
LIABILITIES
- -----------
Excess contribution refunds payable 43,559 19,181
---------- ----------
Net assets available for Plan benefits $2,360,491 $3,205,495
---------- ----------
---------- ----------
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
For the Year
Ended December 31,
-------------------------
1995 1996
---------- ----------
Increase in net assets attributed to:
Interest and dividend income $ 85,176 $ 136,997
Net appreciation in fair value of investments 234,442 1,524,256
Contributions:
Employee 772,792 747,334
Employee rollovers 6,413 85,243
Employer 144,849 159,617
---------- ----------
Total contributions 924,054 992,194
---------- ----------
Total increase 1,243,672 2,653,447
Decrease in net assets attributed to:
Distribution to Billing Information Concepts Corp.
401(k) Retirement Plan -- 1,246,389
Excess contributions refundable to participants 43,559 19,181
Termination and withdrawal benefits 320,044 542,873
---------- ----------
Total decrease 363,603 1,808,443
Net increase 880,069 845,004
Net assets available for Plan benefits:
Beginning of year 1,480,422 2,360,491
---------- ----------
End of year $2,360,491 $3,205,495
---------- ----------
---------- ----------
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1. PLAN DESCRIPTION
The following description of the U.S. Long Distance Corp. 401(k) Retirement
Plan (the "Plan") provides only general information. Participants should refer
to the Plan agreement for a more comprehensive description of the Plan's
provisions.
GENERAL
The Plan was adopted on January 1, 1992, and was amended and restated
effective July 1, 1994. In 1996, the Plan provided for one additional mutual
fund and another common stock fund as investment options. The Plan is a defined
contribution plan which has a salary deferral feature under section 401(k) of
the Internal Revenue Code of 1986, as amended (the "Code"). The Plan covers all
eligible employees of U.S. Long Distance Corp. (the "Company" or "USLD") and its
subsidiaries. The Company is the Plan administrator, and certain officers and an
employee of the Company are the Plan's trustees. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974, as amended
("ERISA").
ELIGIBILITY
An employee is eligible to join the Plan after completion of one year of
employment, provided the employee has worked at least 1,000 hours and has
attained the age of 21. Eligible employees may enter the Plan on the earlier of
January 1 or July 1, after completion of one year of employment with the
Company.
CONTRIBUTIONS
Employees may elect to contribute up to 15% of their total eligible
compensation, as defined in the Plan agreement, to the Plan each year. Such
contributions may be directed to any of six mutual funds and two common stock
funds. Employee contributions include excess contributions which will be
refunded to certain highly compensated participants subsequent to year-end as
the contributions were determined to be in excess of maximum contribution levels
for highly compensated participants. A liability for excess contributions
payable in the amount of $43,559 and $19,181 has been reflected in the
statements of net assets available for Plan benefits at December 31, 1995 and
1996, respectively.
In 1995, the Company's matching contribution was 25% of the first 6% of the
employee's compensation contributed to the Plan. In 1996, the employer's
contribution was modified to 50% of the first 3% of the employee's compensation
contributed to the Plan.
Each participant account is credited with the participant's contributions,
the Company's matching contribution, and an allocation of the Plan's earnings or
losses. Allocations of earnings or losses are based on the value of participant
account balances, as defined in the Plan agreement. Employees are permitted to
rollover money held in other qualified plans into the Plan, provided that the
trust from which such funds are transferred permits such transfers and the
transfer does not jeopardize the tax exempt status of the Plan.
VESTING
Participants immediately vest in that portion of their participant accounts
which are the result of their contributions and earnings thereon. The portion of
the participant accounts resulting from employer contributions and earnings
thereon vest 25% per year beginning after completion of the second year of
service. Participants become 100% vested in employer contributions and earnings
thereon upon completion of five years of service. If a participant's service is
terminated, prior to completion of five years of service, by retirement on or
after normal retirement age, as defined in the Plan agreement, or for death or
disability, the participant becomes 100% vested in employer contributions and
earnings thereon.
6
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1. PLAN DESCRIPTION (CONTINUED)
INVESTMENT OPTIONS
Upon enrollment in the Plan, a participant may direct contributions to any
one or more of the following eight investment options:
1) Merrill Lynch Basic Value Fund - Funds are invested in shares of a
registered investment company that invests primarily in equity securities
with the objective of capital appreciation and, secondarily, income.
2) Merrill Lynch Corporate Bond Fund - Funds are invested in shares of a
registered investment company that invests in investment grade corporate
fixed income securities.
3) Merrill Lynch Global Allocation Fund - Funds are invested in shares of a
registered investment company that invests in U.S. and foreign equity and
debt securities and money market instruments.
4) Merrill Lynch Growth Fund for Investment and Retirement ("Growth Fund") -
Funds are invested in shares of a registered investment company that
invests in a diversified portfolio of equity securities with the objective
of growth of capital and, secondarily, income.
5) Merrill Lynch International Equity Fund ("Int'l. Equity Fund") - Funds are
invested in shares of a registered investment company that invests in a
diversified portfolio of equity securities of issuers located in countries
other than the United States.
6) Merrill Lynch Retirement Preservation Trust - Funds are invested in shares
of a registered investment company that invests primarily in U.S.
government and U.S. government agency securities and Guaranteed Investment
Contracts.
7) U.S. Long Distance Corp. Common Stock ("USLD Common Stock") - Funds are
invested in the common stock of U.S. Long Distance Corp.
8) Billing Information Concepts Corp. Common Stock ("Billing Common Stock") -
Funds are invested in the common stock of Billing Information Concepts
Corp.
Participants may change their investment options on a daily basis.
LOANS
Participants are permitted to borrow money from the Plan based upon their
vested account balances. However, certain limitations, as defined in the Plan
agreement, exist on the type and amount of loan. The term of the loan may not
exceed five years, unless such loan is for the purchase of a primary residence,
in which case the term of the loan may not exceed the life of the mortgage.
Loans outstanding at December 31, 1995 and 1996 bear interest at rates ranging
from 8.75% to 10.25%. Principal and interest are paid ratably through regular
payroll deductions.
FORFEITURES
Forfeitures of the Company's matching contributions will be used to reduce
the Company's future matching contributions, as provided by the Plan.
Forfeitures available to reduce future Company matching contributions amounted
to approximately $28,000 and $76,000 at December 31, 1995 and 1996,
respectively. No forfeitures were used to reduce the Company's contributions in
1995 or 1996.
7
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 1. PLAN DESCRIPTION (CONTINUED)
VOTING
In 1995, all shares of USLD common stock credited to a participant's
account were voted by the trustees. Beginning August 2, 1996, all shares of
USLD common stock and Billing Information Concepts Corp. ("Billing") common
stock were voted by the participants in accordance with the Plan's provisions,
as amended.
TERMINATED PARTICIPANTS
Under the terms of the Plan, terminated participants whose vested account
balance is less than $3,500 will receive a lump-sum distribution at the date
determined under the Plan. Although other terminated participants may elect to
defer receipt of their benefits until a future date, that future date cannot be
later than April 1 of the calendar year following the calendar year in which the
participant reaches the age of 701/2.
PLAN AMENDMENTS
The Company has the right to amend the Plan at any time. However, no
amendment, change or modification may deprive a participant of any vested
benefits under the Plan.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right to discontinue its contributions to the Plan at any time and to terminate
the Plan subject to the provisions of ERISA, as amended. In the event of Plan
termination, participants will become 100% vested in their participant accounts.
NOTE 2. DISTRIBUTION TO BILLING
BILLING INFORMATION CONCEPTS CORP. COMMON STOCK FUND
On August 2, 1996, the Company completed the spin-off of its wholly owned
subsidiary, Billing. The spin-off was a tax-free distribution of 100% of the
common stock of Billing to the Company's stockholders. Stockholders of record
as of the date of distribution received one share of Billing common stock for
each share of USLD common stock held. For purposes of the allocation of cost,
the fair market value per share of the common stock of each company was adjusted
via a formula adjustment based on the relative fair market values of the
underlying common stock of each of the two companies, or by a factor of 25.9%
for USLD and 74.1% for Billing. The fair market value per share of common stock
of each company was defined as the average of the last sales price per share of
that common stock on the Nasdaq National Market for each of the ten consecutive
trading days immediately subsequent to the date of distribution. As a result of
the spin-off, the formation of the Billing Information Concepts Corp. Common
Stock Fund was created. This fund invests in the common stock of Billing. This
new fund was offered as an additional investment option to participants
effective October 1, 1996. In conjunction with the spin-off of Billing, a
separate retirement plan was established for the employees of Billing. The
$1,246,389 distribution represents the transfer of Billing employee's investment
accounts to the Billing Information Concepts Corp. 401(k) Retirement Plan.
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The accompanying financial statements are presented on the accrual basis of
accounting. Benefits are recorded when paid.
8
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts in the financial statements and
disclosures. Actual results could differ from those estimates.
INVESTMENTS
Investments are stated at fair market value. The fair market value of
investments is based on quotations obtained from THE WALL STREET JOURNAL.
Investment transactions are recognized on the trade date (the date the order to
buy or sell is executed). The cost of investments sold is based on the average
purchase price. Net appreciation in the fair value of investments includes both
realized and unrealized gains and losses incurred during the year. Unrealized
appreciation or depreciation in the market values of investments held at year-
end and gain or loss on sales of investments during the year are determined
using the market value at the beginning of the year or the purchase price if
acquired during the year. Net unrealized gains or losses are reflected in the
statements of changes in net assets available for Plan benefits.
PLAN ADMINISTRATION
Expenses incident to the administration of the Plan, such as trustee,
legal, accounting and auditing fees have been paid by the Company. During the
years ended December 31, 1995 and 1996, the Company incurred approximately
$31,000 and $65,000, respectively, in expenses incident to the administration of
the Plan.
NOTE 4. FEDERAL INCOME TAXES
The Internal Revenue Service has determined and informed the Company by a
letter dated November 13, 1995 that the Plan is designed in accordance with
applicable sections of the Code. The Plan is qualified under the provisions of
Sections 401(a) and 401(k) and is tax exempt from federal income taxes under
provision 501(a) of the Code.
NOTE 5. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for Plan benefits
according to the financial statements to Form 5500:
December 31,
-----------------------
1995 1996
---------- ----------
Net assets available for Plan benefits
per the financial statements $2,360,491 $3,205,495
Amounts allocated to withdrawing
participants (51,659) (113,009)
---------- ----------
Net assets available for Plan benefits
per Form 5500 $2,308,832 $3,092,486
---------- ----------
---------- ----------
9
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
NOTE 5. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 (CONTINUED)
The following is a reconciliation of benefits paid to participants
according to the financial statements to Form 5500:
Year Ended
December 31,
1996
------------
Termination and withdrawal benefits
per the financial statements $542,873
Add: Amounts allocated to withdrawing
participants at December 31, 1996 113,009
Less: Amounts allocated to withdrawing
participants at December 31, 1995 51,659
--------
Termination and withdrawal benefits
per Form 5500 $604,223
--------
--------
Amounts allocated to withdrawing participants are recorded on the Form 5500 for
benefit claims that have been processed and approved for payment prior to
December 31, but not yet paid as of that date.
10
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN Exhibit I
STATEMENT OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
DECEMBER 31, 1995
<TABLE>
Merrill Lynch
-----------------------------------------------------------
Basic Corporate Global Retirement USLD
Value Bond Allocation Growth Preservation Common
Fund Fund Fund Fund Trust Stock Total
--------- ---------- ---------- ------- ------------ --------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Merrill Lynch
Basic Value Fund $ 223,957 $ - $ - $ - $ - $ - $ 223,957
Merrill Lynch
Corporate Bond Fund - 88,378 - - - - 88,378
Merrill Lynch Global
Allocation Fund - - 414,521 - - - 414,521
Merrill Lynch
Growth Fund - - - 460,695 - - 460,695
Merrill Lynch Retirement
Preservation Trust - - - - 148,405 - 148,405
U.S. Long Distance Corp.
Common Stock - - - - - 1,026,314 1,026,314
Participant Loans - - 29 119 - 9,566 9,714
Cash - - - - - 1,725 1,725
Contributions receivable:
Employee 3,720 1,263 4,692 5,404 2,259 8,132 25,470
Employer 686 231 926 937 431 1,660 4,871
--------- --------- --------- --------- --------- ---------- -----------
Total assets 228,363 89,872 420,168 467,155 151,095 1,047,397 2,404,050
LIABILITIES:
Excess contribution refunds
payable 5,731 6,288 9,237 1,034 - 21,269 43,559
--------- --------- --------- --------- --------- ---------- -----------
Net assets available for plan
benefits $ 222,632 $ 83,584 $ 410,931 $ 466,121 $ 151,095 $1,026,128 $2,360,491
--------- --------- --------- --------- --------- ---------- -----------
--------- --------- --------- --------- --------- ---------- -----------
</TABLE>
<PAGE>
Exhibit I (continued)
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
DECEMBER 31, 1996
<TABLE>
Merrill Lynch
--------------------------------------------------------
Basic Corporate Global Int'l. Retirement USLD Billing
Value Bond Allocation Growth Equity Preservation Common Common
Fund Fund Fund Fund Fund Trust Stock Stock Total
-------- -------- -------- -------- ------- ------------ -------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Merrill Lynch
Basic Value Fund $335,921 $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ 335,921
Merrill Lynch
Corporate Bond Fund -- 99,962 -- -- -- -- -- -- 99,962
Merrill Lynch Global
Allocation Fund -- -- 415,697 -- -- -- -- -- 415,697
Merrill Lynch
Growth Fund -- -- -- 629,618 -- -- -- -- 629,618
Merrill Lynch International
Equity Fund -- -- -- -- 42,377 -- -- -- 42,377
Merrill Lynch Retirement
Preservation Trust -- -- -- -- -- 190,846 -- -- 190,846
U.S. Long Distance Corp.
Common Stock -- -- -- -- -- -- 412,675 -- 412,675
Billing Information Concepts
Corp. Common Stock -- -- -- -- -- -- -- 1,074,512 1,074,512
Participant Loans 1,468 1,251 1,379 11,572 -- -- 5,330 -- 21,000
Cash -- -- -- -- -- -- 1,725 -- 1,725
Contributions receivable:
Employee -- -- -- -- -- 41 161 83 285
Employer -- -- -- -- -- 8 37 13 58
-------- -------- -------- -------- ------- -------- -------- ---------- ----------
Total assets 337,389 101,213 417,076 641,190 42,377 190,895 419,928 1,074,608 3,224,676
LIABILITIES:
Excess contribution
refunds payable 2,906 603 3,171 6,388 452 216 2,142 3,303 19,181
-------- -------- -------- -------- ------- -------- -------- ---------- ----------
Net assets available for
plan benefits $334,483 $100,610 $413,905 $634,802 $41,925 $190,679 $417,786 $1,071,305 $3,205,495
-------- -------- -------- -------- ------- -------- -------- ---------- ----------
-------- -------- -------- -------- ------- -------- -------- ---------- ----------
</TABLE>
12
<PAGE>
<TABLE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN Exhibit II
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1995
Merrill Lynch
---------------------------------------------------------------
Basic Corporate Global Retirement USLD
Value Bond Allocation Growth Preservation Common
Fund Fund Fund Fund Trust Stock Total
---- ---- ---- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Increase in net assets attributed to:
Interest and
dividend income $ 7,782 $ 3,816 $ 29,167 $ 38,068 $ 5,724 $ 619 $ 85,176
Net appreciation in fair
value of investments 33,000 6,469 30,532 54,035 - 110,406 234,442
Contributions:
Employee 82,376 40,014 164,495 164,863 30,839 290,205 772,792
Employee rollovers 2,508 194 972 859 - 1,880 6,413
Employer 15,488 7,755 30,422 30,258 6,203 54,723 144,849
--------- --------- --------- --------- --------- ----------- ----------
Total contributions 100,372 47,963 195,889 195,980 37,042 346,808 924,054
Decrease in net assets attributed to:
Excess contributions (5,731) (6,288) (9,237) (1,034) - (21,269) (43,559)
Termination and
withdrawal benefits (14,267) (2,583) (29,207) (38,742) (43,948) (191,297) (320,044)
Transfers (to) from other
funds 10,767 (1,075) 12,917 16,977 97,744 (137,330) -
--------- --------- --------- --------- --------- ----------- ----------
Net increase 131,923 48,302 230,061 265,284 96,562 107,937 880,069
Net assets available
for Plan benefits:
Beginning of year 90,709 35,282 180,870 200,837 54,533 918,191 1,480,422
--------- --------- --------- --------- --------- ----------- ----------
End of year $ 222,632 $ 83,584 $ 410,931 $ 466,121 $ 151,095 $ 1,026,128 $2,360,491
--------- --------- --------- --------- --------- ----------- ----------
--------- --------- --------- --------- --------- ----------- ----------
</TABLE>
13
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN Exhibit II (continued)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE
FOR PLAN BENEFITS WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1996
<TABLE>
Merrill Lynch
-----------------------------------------------------------------
Basic Corporate Global Int'l. Retirement USLD Billing
Value Bond Allocation Growth Equity Preservation Common Common
Fund Fund Fund Fund Fund Trust Stock Stock Total
---------- -------- ---------- -------- ------ ------------ -------- ------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Interest and
dividend income $ 23,773 $ 6,883 $ 42,414 $ 47,197 $ 2,018 $ 8,979 $ 5,363 $ 370 $ 136,997
Net appreciation/(depreciation)
in fair value of
investments 21,109 (4,951) 20,548 101,850 (965) 91 570,929 815,645 1,524,256
Contributions:
Employee 90,488 38,207 134,365 160,561 28,681 18,753 271,614 4,665 747,334
Employee rollovers 1,142 140 - 36,844 2,432 1,364 43,181 140 85,243
Employer 22,255 9,241 27,557 33,113 5,854 5,956 54,901 740 159,617
--------- --------- --------- --------- -------- --------- --------- ----------- -----------
Total contributions 113,885 47,588 161,922 230,518 36,967 26,073 369,696 5,545 992,194
Distribution to Billing (70,903) (33,529) (152,319) (131,808) (4,339) (33,265) (253,929) (566,297) (1,246,389)
Excess contributions (2,906) (603) (3,171) (6,388) (452) (216) (2,142) (3,303) (19,181)
Termination and
withdrawal benefits (40,043) (5,407) (83,417) (130,046) (877) (45,309) (156,902) (80,872) (542,873)
Transfers (to) from other
funds 66,936 7,045 16,997 57,358 9,573 83,231 (1,141,357) 900,217 -
--------- --------- --------- --------- -------- --------- --------- ----------- -----------
Net increase 111,851 17,026 2,974 168,681 41,925 39,584 (608,342) 1,071,305 845,004
Net assets available
for Plan benefits:
Beginning of year 222,632 83,584 410,931 466,121 - 151,095 1,026,128 - 2,360,491
--------- --------- --------- --------- -------- --------- --------- ----------- -----------
End of year
$ 334,483 $ 100,610 $ 413,905 $ 634,802 $ 41,925 $ 190,679 $ 417,786 $ 1,071,305 $ 3,205,495
--------- --------- --------- --------- -------- --------- --------- ----------- -----------
--------- --------- --------- --------- -------- --------- --------- ----------- -----------
</TABLE>
14
<PAGE>
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN Schedule I
ITEM 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
<TABLE>
Identity of Issuer, Borrower Description of Current
Lessor or Similar Party Investment Cost Value
- --------------------------------- ----------------------------- ---------- ----------
<S> <C> <C> <C>
Merrill Lynch* Basic Value Fund $ 304,724 $ 335,921
Merrill Lynch* Corporate Bond Fund 98,550 99,962
Merrill Lynch* Global Allocation Fund 401,581 415,697
Merrill Lynch* Growth Fund 545,537 629,618
Merrill Lynch* International Equity Fund 49,268 42,377
Merrill Lynch* Retirement Preservation Trust 190,846 190,846
U.S. Long Distance Corp.* Common Stock 288,169 412,675
Billing Information Concepts Corp. Common Stock 483,022 1,074,512
U.S. Long Distance Corp.
401(k) Retirement Plan * Participant Loans at Interest Rates
Ranging from 8.75% to 10.25% 21,000 21,000
---------- ----------
$2,382,697 $3,222,608
---------- ----------
---------- ----------
</TABLE>
* A party in interest to the Plan.
15
<PAGE>
U.S. LONG DISTANCE CORP. 401(K) RETIREMENT PLAN Schedule II
ITEM 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1996
<TABLE>
Identity of Party Involved/ Number of Purchase Selling Cost of Net
Description of Asset Shares Price Price Assets Gain
- ----------------------------------------------------- --------- -------- ------- ------- ----
<S> <C> <C> <C> <C> <C>
SERIES TRANSACTIONS:
- --------------------
Merrill Lynch Basic Value Fund:
Purchases 7,349 $ 217,024 $ - $ 217,024 $ -
Sales 4,374 - 126,566 106,010 20,556
Merrill Lynch Corporate Bond Fund:
Purchases 5,918 66,753 - 66,753 -
Sales 4,552 - 50,480 49,710 770
Merrill Lynch Global Allocation Fund:
Purchases 19,280 277,653 - 277,653 -
Sales 20,523 - 296,431 263,072 33,359
Merrill Lynch Growth Fund:
Purchases 15,967 360,509 - 360,509 -
Sales 12,618 - 292,850 234,289 58,561
Merrill Lynch International Equity Fund:
Purchases 4,298 49,268 - 49,268 -
Sales 521 - 5,946 - 5,946
Merrill Lynch Retirement Preservation Trust:
Purchases 87,750 87,750 - 87,750 -
Sales 45,309 - 45,309 45,309 -
U.S. Long Distance Corp. Common Stock Fund:
Purchases 26,539 251,336 - 251,336 -
Sales 48,263 - 675,405 216,679 458,726
Billing Information Concepts Corp. Common Stock Fund:
Purchases 72,187 185,452 - 185,452 -
Sales 34,813 - 687,084 427,732 259,352
</TABLE>
Note: This schedule is a listing of series of investment transactions
in the same security which exceeded 5% of the market value of the
Plan assets as of January 1, 1996, and are deemed to be
reportable transactions for the year ended December 31, 1996.
The current value of assets on transaction date for a purchase
and sale is equal to the purchase price and selling price,
respectively.
16
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
U.S. LONG DISTANCE CORP. 401(k) RETIREMENT PLAN
By /s/ Phillip J. Storin
-------------------------------------
Phillip J. Storin
Trustee
By /s/ David S. Horne
-------------------------------------
David S. Horne
Trustee
By /s/ Melisa Caston
-------------------------------------
Melisa Caston
Trustee
Date: June 23, 1997
17
<PAGE>
EXHIBIT 1.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report included in this Form 11-K into the Company's previously filed
Registration Statements on Form S-8 (File #33-46567 and File #33-81686).
ARTHUR ANDERSEN LLP
San Antonio, Texas
June 24, 1997
