USCI INC, PRE 14A, 1998-07-29

USCI INC
PRE 14A, 1998-07-29
BUSINESS SERVICES, NEC

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SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

Filed by Registrant [X]
Filed by a Party other than Registrant [ ]

Check the Appropriate Box:
[X] Preliminary Proxy Statement
[ ] Confidential, for use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c)
or Section 240.14a-12

USCI, INC.
(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the Appropriate Box):
[X] No Fee Required.
[ ] Fee computed on table below per Exchange Act
Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction
applies:
2) Aggregate number of securities to which transaction
applies:
3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth
the amount on which the filing fee is calculated and
state how it was determined)
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the
Form or Schedule and the date of its filing:

1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:

Copies of all communications to:
LEONARD R. GLASS, ESQ.
Law Offices of Leonard R. Glass, P.A.
45 Central Ave, P.O. Box 579
Tenafly, New Jersey 07670-0579
(201) 894-9300

<PAGE>
USCI, INC.
6115-A Jimmy Carter Boulevard
Norcross, Georgia 30071

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To the Stockholders of USCI, Inc.
Notice is hereby given that the Annual Meeting of Stockholders of USCI, Inc.
(the "Company") will be held at the Grand Hyatt Hotel, 3300 Peachtree Rd.,
Atlanta, Georgia, on September __, 1998 at 9:00 a.m., local time, for the
following purposes, all of which are more completely set forth in the
accompanying Proxy Statement:

1. To elect as directors the five (5) persons listed in the
accompanying Proxy Statement;

2. To amend the Company's Certificate of Incorporation to provide
for the authorization of 1,000,000 additional shares of Preferred
Stock;

3. To ratify the private placement of $5.5 million Unsecured Notes
and Stock Purchase Warrants;

4. To ratify the private placement of up to $15 million of 6%
Convertible Preferred Stock and Stock Purchase Warrants;

5. To approve an amendment to the Company's 1997 Stock Option Plan
to increase by 1,000,000 shares the number of shares that may be
issued pursuant to the Plan;

6. To approve the Company's 1998 Employee Stock Purchase Plan;

7. To ratify the appointment of Arthur Andersen LLP as the
independent accountants of the Company for the fiscal year ending
December 31, 1998; and

8. To consider and transact any other business that may lawfully
come before the meeting or any adjournment thereof.

The Board of Directors has fixed the close of business on August 24,
1998 as the record date for the determination of stockholders entitled to
vote at the Meeting and to receive notice thereof. Accordingly, only
stockholders of record on such date will be entitled to vote at the meeting.
The stock transfer books of the Company will not be closed.

Please sign the enclosed proxy and return it in the enclosed envelope.

By Order of the Board of Directors

Bruce A. Hahn, Chairman
September __, 1998
Mailed at Norcross, Georgia
IMPORTANT
STOCKHOLDERS ARE REQUESTED TO DATE, SIGN AND MAIL PROMPTLY THE ENCLOSED
PROXY SO THAT YOUR SHARES MAY BE VOTED IN ACCORDANCE WITH YOUR WISHES AND IN
ORDER THAT THE PRESENCE OF A QUORUM MAY BE ASSURED, A POSTAGE-PAID ENVELOPE
IS PROVIDED FOR MAILING IN THE UNITED STATES. YOU ARE ENTITLED TO REVOKE
YOUR PROXY AT ANY TIME BEFORE IT IS EXERCISED BY WRITTEN NOTICE TO THE
COMPANY. ALSO, IF YOU ATTEND THE MEETING AND VOTE IN PERSON, THE PROXY WILL
NOT BE USED.

PROXY STATEMENT

1998 ANNUAL MEETING OF STOCKHOLDERS OF
USCI, INC.
TO BE HELD SEPTEMBER __, 1998

Approximate Date of Mailing to Stockholders:
August __, 1998

TIME AND PLACE OF MEETING

This Proxy Statement is furnished to stockholders by the Board of
Directors of USCI, Inc., a Delaware corporation (the "Company"), for
solicitation of Proxies for use at the 1998 Annual Meeting of Stockholders
to be held on September __, 1998 at 9:00 a.m., and at all adjournments
thereof, for the purposes set forth in the attached Notice of Annual
Meeting.

The Company's principal executive offices are located at 6115-A Jimmy
Carter Boulevard, Norcross, Georgia 30071 (770-840-8888).

Proxies in the form enclosed are solicited on behalf of the Board of
Directors. Any stockholder giving a proxy in such form has the power to
revoke it at any time before it is exercised by filing a later proxy with
the Company, by attending the meeting and voting in person, or by notifying
the Company of the revocation in writing to its Secretary at 6115-A Jimmy
Carter Boulevard, Norcross, Georgia 30071. Any such proxy, if received in
time for voting and not revoked, will be voted at the meeting in accordance
with the instructions indicated on the proxy. If no instructions are
indicated on a properly executed proxy, the shares represented by that proxy
will be voted as recommended by the Board of Directors.

VOTING RIGHTS AND VOTE REQUIRED

As of August 24, 1998 (the "Record Date"), the Company had outstanding
and entitled to vote ___________shares of Common Stock (the "Common Stock").
There is no other class of Common Stock of the Company outstanding. Only
stockholders of record at the close of business on the Record Date are
entitled to vote at the Annual Meeting. Each outstanding share entitles the
record holder to one (1) vote on the matters to be voted upon at the
meeting. The stock transfer books will not be closed for the purposes of
such vote.

In accordance with Delaware law, a list of stockholders entitled to
vote at the Annual Meeting will be available and open to examination by any
stockholder for any purpose germane to the Annual Meeting at the Grand Hyatt
Hotel, 3300 Peachtree Rd., Atlanta, Georgia on August 24, 1998, and for ten
days prior to the Annual Meeting between the hours of 9:00 a.m. and 5:00
p.m. at the office of the Company at 6115-A Jimmy Carter Boulevard,
Norcross, Georgia 30071.

The holders of a majority of interest of all Common Stock issued,
outstanding and entitled to vote at a stockholders' meeting, present in
person or by proxy, constitute a quorum pursuant to the Company's By-laws.
In the absence of a quorum, the Annual Meeting may be postponed from time to
time until stockholders holding the requisite amount are present or
represented by proxy.

Abstentions and broker "non-votes" are counted as present and entitled
to vote for purposes of determining a quorum. A broker "non-vote" occurs
when a nominee holding shares for a beneficial owner does not vote on a
particular proposal because the nominee does not have discretionary voting
power with respect to that item and has not received instructions from the
beneficial owner.

A plurality of the votes duly cast is required for the election of
Directors (i.e., the nominees receiving the greatest number of votes will be
elected). Abstentions and broker "non-votes" are not counted for purposes
of the election of Directors.

The affirmative vote by the holders of a majority of shares of Common
Stock present in person or represented by proxy and entitled to vote on the
matter is required to approve any other matter to be acted upon at the
Annual Meeting. An abstention is counted as a vote against and a broker
"non-vote" is not counted for purposes of approving other matters to be
acted upon at the Annual Meeting.

Security Ownership of Certain Beneficial Owners

The following table sets forth certain information as of March 24,
1998 with respect to the Common Stock beneficially owned by each Director
and Nominee for Director, by each Named Executive Officer, by all of the
Directors and Executive Officers of the Company as a group, and by each
person known by the management of the Company to own beneficially more than
five (5%) percent of the outstanding shares of the Common Stock.

<TABLE>
<CAPTION>
Name and Address Number of Shares Percentage
of Beneficial Owner Beneficially Owned (1) of Class (2)
<S> <C> <C>
Bruce A. Hahn
6115A Jimmy Carter Blvd.
Norcross GA 1,227,242 (3) 11.3%
Edgar Puthuff 210,520 (4) 2.3%
Jerome S. Baron 115,776 (5) 1.9%
Salvatore T. DiMascio 52,000 (6) *
Stephen E. Pazian 25,000 (7) *
Robert J. Kostrinsky 229,067 (8) 2.1%
Basil H. Ford 23,100 (9) *
Mario H. Martinez 256,000 (10) 2.3%
All directors and executive
officers as a group
(eight persons) 2,138,705 (11) 18.7%
<FN>
* Less than 1%.
(1) Unless otherwise indicated, each beneficial owner has both sole voting and sole investment power with
respect to the shares beneficially owned by such person, entity or group. The number of shares shown as
beneficially owned include all options, warrants and convertible securities held by such person, entity
or group which are exercisable or convertible within 60 days of March 24, 1998.
(2) The percentages of beneficial ownership as to each person, entity or group assume the exercise or
conversion of all options, warrants and convertible securities held by such person, entity or group
which are exercisable or convertible within 60 days, but not the exercise or conversion of options,
warrants and convertible securities held by others shown in the table.
(3) Includes 153,437 shares issuable upon the exercise of currently exercisable options at $3.80 per share
(118,437 shares) and $6.00 per share (35,000 shares) and 110,000 shares held by members of Mr. Hahn's
immediate family.
(4) Includes 93,743 shares issuable upon the exercise of currently exercisable options, at $4.25 (25,000
shares),$4.43 (39,479 shares), $6.00 (4,264) and $8.25 (25,000 shares) per share; also includes 54,138
shares held by the Puthuff Littleton & Smith, Inc. Pension and Profit Sharing Plan, of which Mr. Puthuff
is the trustee, and 20,000 shares issuable upon the exercise of currently exercisable options at $5.75
per share held by Puthuff Littleton & Smith, Inc., of which Mr. Puthuff is a principal.
(5) Includes 91,870 shares issuable upon the exercise of currently exercisable options, at $4.43 (39,479
shares), $4.25 (25,000 shares), $6.00 (2,391 shares) and $8.25 (25,000 shares) per share.
(6) Includes 50,000 shares issuable upon the exercise of currently exercisable options, at $4.25 (25,000
shares) and $6.75 (25,000 shares) per share.
(7) Includes 25,000 shares issuable upon the exercise of currently exercisable options, at $6.25 per share.
(8) Includes 64,567 shares issuable upon the exercise of currently exercisable options at $3.80 (59,217
shares) and $6.00 (5,350 shares) per share.
(9) Includes 10,000 shares issuable upon the exercise of currently exercisable options at $8.25 per share.
(10) Includes 255,000 shares issuable upon the exercise of currently exercisable options at $3.50 per
share.
(11) Includes the shares described in footnotes (3) through (10) above.
</FN>
</TABLE>

PROPOSAL 1:

ELECTION OF DIRECTORS

Unless the authority to do so is withheld, the enclosed Proxy will
be voted for the election of the Nominees named below to hold office
until the next Annual Meeting of the Stockholders and until their
successors shall be duly elected and qualified. In the event any of the
Nominees should be unwilling or unable to serve as a Director, the Proxy
will be voted for such substitute Nominee as the Board of Directors may
designate or in the absence of such designation in accordance with the
best judgment of the person or persons acting under the Proxy.
Management is not aware of any Nominee who is unable or will decline to
serve as a Director.

The following table sets forth the name and age of each Nominee,
the period during which he has served as Director and the other
capacities in which he currently serves the Company:

<TABLE>
<CAPTION>
Period
Served as Other Capacities in which
Name Age Director Currently Serving
<S> <C> <C> <C>
Bruce A. Hahn 49 Since May 1995 Chairman and
Chief Executive Officer
Edgar Puthuff (1)(2) 62 Since May 1995 None
Jerome S. Baron (1)(3) 71 Since May 1995 None
Salvatore T. DiMascio (2)(3) 58 Since July 1996 None
Stephen Pazian 49 Since October 1997 None
____________________
<FN>
(1) Current member of the Compensation and Personnel Committee.
(2) Current member of the Finance Committee.
(3) Current member of the Audit Committee.
</FN>
</TABLE>

Bruce A. Hahn has been a director of U.S. Communications, Inc. since its
inception in January 1991, its Chairman since November 1991 and Chief
Executive Officer since December 1992. He has held the same positions
with the Company since the completion of the merger with Trinity Six
Inc. in May 1995.

Edgar R. Puthuff has been a director of U.S. Communications, Inc. since
June 1992 and a director of the Company since May 1995. Mr. Puthuff has
been Chairman of Puthuff Littleton & Smith, Inc. (formerly Miller
Puthuff Associates, Inc.), a sales/marketing representative for major
accounts such as Kmart Corporation, for more than 20 years. Mr. Puthuff
is also currently a director of General Energy Corp., and served briefly
as director of International Consumer Brands, Inc.

Jerome S. Baron has been a director of U.S. Communications, Inc. since
December 1993 and a director of the Company since May 1995. Mr. Baron is
President of Brean Murray & Co., Inc., a New York Stock Exchange and
American Stock Exchange member firm. Mr. Baron is also a director of CAS
Medical Systems, Inc., a public company engaged in the manufacture and
marketing of blood pressure monitors and other medical products
principally for the neonatal care market.

Salvatore T. DiMascio became a director of the Company in July 1996.
Since 1986, Mr. DiMascio has been President of DiMascio Venture
Management, Inc., a management and investment firm. From June 1994
until June 1997, Mr. DiMascio was Executive Vice President and Chief
Financial Officer of Anchor Gaming, a publicly held diversified gaming
company. From 1978 to 1986, Mr. DiMascio was Senior Vice President and
Chief Financial Officer of Conair Corporation. Mr. DiMascio is also a
director of Fotoball U.S.A., a public company which develops and
manufactures custom sports related products, and H.E.R.C. Products,
Inc., a public company in the water treatment business. Mr. DiMascio is
a certified public accountant.

Stephen E. Pazian became a director of the Company in October 1997. He
is currently the Chief Executive Officer and President of Edison
Enterprises, a division of Edison International engaged in the provision
of various commercial and residential products and services. From 1996
to 1997 Mr. Pazian was President of Ameritech Security Monitoring
Services with responsibility for strategic management and business
development. From 1988 to 1996 Mr. Pazian was an officer at Bell South
Corporation, serving from 1989 to 1996 as President and Chief Executive
Officer of MobileComm., Bell South's paging and voice-messaging company.
From 1986 to 1988, Mr. Pazian was a Vice President, and then Executive
Vice President, at Bell Atlantic Mobile Systems.

During the fiscal year ended December 31, 1997, the Board of
Directors held six meetings. Except for Edgar Puthuff, who was unable
to attend one meeting, each Director participated in all meetings held
during his term of office.

There are no arrangements known to the Company the operation of
which may at a subsequent date result in a change in control of the
Company.

Committees of the Board

Compensation and Personnel Committee. The Compensation and
Personnel Committee of the Board of Directors consists of Messrs. Baron
and Puthuff and acts upon the compensation of the executive officers of
the Company and such other persons as are determined by the Board of
Directors and administers the Company's stock option plans and stock
purchase plan. During the fiscal year ended December 31, 1997, the
Compensation Committee held three meetings.

Audit Committee. The Audit Committee is comprised of Messrs. Baron
and DiMascio. The Audit Committee meets with management to consider the
adequacy of the Company's internal controls and the objectivity of
financial reporting; the committee also meets with the independent
auditors and with appropriate Company financial personnel about these
matters. The committee recommends to the Board the appointment of the
independent auditors, subject to ratification by the stockholders at the
Annual Meeting. The independent auditors have unrestricted access to
the Committee. During the fiscal year ended December 31, 1997, the
Audit Committee held two meetings.

Finance Committee. The Finance Committee is comprised of Messrs.
DiMascio and Puthuff and is responsible for making recommendations to
the Board concerning investment policy and methods of financing the
operations of the Company and its subsidiaries and evaluating new
business and investment opportunities. During the fiscal year ended
December 31, 1997, the Finance Committee held three meetings.

Directors' Compensation

Directors of the Company who are employees do not receive
remuneration for services as directors. Directors who are not employees
receive options to purchase shares of the Company's Common Stock, in an
amount determined annually by the Board of Directors, as compensation
for services rendered as directors, plus reimbursement of out-of-pocket
expenses for each meeting attended. In March 1997, the Company granted
five year options to purchase 25,000 shares at $4.25 per share to each
of Messrs. Baron, DiMascio and Puthuff as directors' fees for 1997. The
options vest in March 1998. In October 1997, the Company granted five
year options to purchase 25,000 shares at $6.25 per share to Mr. Pazian
as his director's fee for 1997. These options vested on the grant date.

The Board of Directors does not have a nominating committee.

All members of the committees of the Board of Directors attended
all of their respective committee meetings.

Executive Officers

The following table sets forth the name and age of each executive
officer of the Company and the office and period during which he has
held such office.

<TABLE>
<CAPTION>
Period Served
Name Age Office as Officer
<S> <C> <C> <C>
Bruce A. Hahn 48 Chairman, Chief Executive Officer Since May 1995
Mario Martinez 38 President; Chief Operating Officer Since August 1997
Robert J. Kostrinsky 39 Executive Vice President; Chief Since May 1995
Financial Officer; Treasurer
Basil H. Ford 53 Vice President - Corporate Development Since June 1996
and Investor Relations; Secretary
Albert T. Bodamer 35 Senior Vice President - Ameritel Since February 1997
Communications, Inc.
</TABLE>

Currently, there is no fixed term of office for any executive
officer. Each person selected to become an executive officer has
consented to act as such and there are no arrangements or
understandings between the executive officers or any other persons
pursuant to which he or she was or is to be selected as an officer.

Mario Martinez joined the Company as President and Chief Operating
Officer in August 1997. Mr. Martinez has 14 years experience of general
management, sales, marketing and business development in the wireless
and wireline telecommunications industries. Prior to joining the
Company, Mr. Martinez was President of AT&T Florida, Consumer Markets
Division, a division of AT&T, with overall responsibility for AT&T's
core consumer long distance business throughout the state of Florida.
From November 1992 to June 1994, Mr. Martinez was Managing Director,
Wireless Markets, for CSC Intelicom, a division of Computer Sciences
Corporation, with responsibility for marketing wireless products in
North America and Puerto Rico. From October 1990 to November 1992, Mr.
Martinez was Vice President, US Direct Sales, for SkyTel, with
responsibility for its direct sales and telemarketing organization and,
from June 1984 to October 1990, Director, National Accounts Business
Development, for Sprint, Inc.

Robert J. Kostrinsky has been Secretary-Treasurer of U.S.
Communications, Inc. since November 1991 and Executive Vice President
since November 1994. He has been Executive Vice President and Treasurer
of the Company since May 1995, and also served as Secretary of the
Company until July 1996. He became Chief Financial Officer in April
1996. Mr. Kostrinsky is a certified public accountant.

Basil H. Ford joined the Company as Vice President - Corporate
Development and Investor Relations in June 1996, and became Secretary of
the Company in July 1996. From 1993 to 1996, Mr. Ford was employed by
Sonoco Products Company, a publicly held multinational packaging
company, serving from 1994 to 1996 as Vice President of Investor
Relations. From 1982 until its acquisition by Sonoco Products in 1993,
Mr. Ford was employed by Engraph Inc., a publicly held packaging
company, most recently (1988 to 1993) as Vice President - Investor
Relations/Corporate Development/Strategic Planning.

Albert T. Bodamer joined the Company in February 1997 as Senior
Vice President, Ameritel Communications, with responsibility for the
Company's non-facilities-based carrier operations. Mr. Bodamer has had
substantial experience in the cellular industry. Prior to joining the
Company, Mr. Bodamer was Vice President and General Manger for the
southern New York region of PriCellular Corp. His previous experience
included serving as general manager for resale and paging services at
Rochester, New York based Frontier Cellular Corp.

For a description of the business background of Mr. Hahn, see the
text immediately following the table on page 3 of this Proxy Statement.

EXECUTIVE COMPENSATION

Board Compensation Committee Report on Executive Compensation

For 1997, decisions regarding executive compensation were made by
the Compensation and Personnel Committee (the "Committee), which is
currently comprised of two independent non-employee directors. The
Committee is charged with establishing and administering the policies
and plans which govern compensation for executive officers, including
those individuals listed in the compensation tables in this proxy
statement. In the case of any executive officers who are also members
of the Board of Directors, the Committee makes recommendations which are
subject to approval by non-employee members of the Board.

Compensation Policies. The Company's executive compensation
philosophy is to utilize employment agreements with its officers to
provide total compensation opportunities which are competitive within
the Company's industry and community so that the Company can attract and
retain high quality executives and to align the interests of the
Company's executives and its stockholders by providing for payment of a
significant portion of executive compensation in the form of stock
options and commissions based on the Company's sales performance. Thus,
the value generated for the Company's stockholders is a key factor in
determining the value ultimately received by the executive officers
under their employment agreements.

Base Salary. Base salaries for executive officers are established
at levels considered appropriate in light of the scope of the duties and
responsibilities for each officer's position. In the Company's three
year agreements with its Chief Executive Officer, Chief Operating
Officer and Executive Vice President, increases have been provided in
base salary over the term of the Agreement to further protect the
Company's vested interest due to their prior service and key strategic
roles.

Commissions/Performance Bonus. Each executive officer's employment
agreement provides for the payment of an annual commission or
performance bonus based upon the number of net activations of wireless
telecommunication devises or cellular telephones processed by the
Company in excess of a threshold amount. The use of net activations, is
believed by the Committee to be the most objective measurement of
executive performance during the current period, where the overriding
objective of the Company is to build its business by increasing sales.

Stock Options. Each executive officer's employment agreement
provides for the grant of incentive stock options. Stock options are
granted with an exercise price equal to the fair market value of the
Company's common stock on the date of the grant. Stock options become
exercisable in full in installments over periods of three or more years
and have terms of either five or ten years from the date of the grant.
Such stock options thus provide incentive for the creation of
stockholder value over the long term since the full benefit of the
compensation package cannot be realized unless an appreciation in the
price of the Company's common stock occurs over a specified number of
years and the executive officer remains employed for the periods
required for the stock options to become exercisable.

CEO Compensation. During 1997, the Company's most highly
compensated officer was Bruce A. Hahn, Chairman of the Board and Chief
Executive Officer. Under his employment agreement, Mr. Hahn received a
base salary of $200,000 and a commission of $45,819. In addition,
options to purchase 39,479 shares of the Company's common stock at $3.80
per share became exercisable by Mr. Hahn as of December 31, 1997. Five-
year options to purchase 35,000 shares of the Company's common stock at
$6.00 per share were granted to Mr. Hahn in October 1997.

Deductibility of Executive Compensation. Section 162(m) of the
Internal Revenue Code denies publicly held companies a deduction for
compensation paid to a named executive officer in a taxable year to the
extent it exceeds $1 million per officer, unless the compensation
qualifies as "performance based compensation." The Committee has no
present policy in respect of Section 162(m) because compensation paid to
any named executive officer of the Company has not approached $1
million.
The Compensation and Personnel Committee:
Jerome S. Baron
Edgar Puthuff

Compensation Tables

The following summary compensation table sets forth information
concerning compensation for services in all capacities awarded to,
earned by or paid to the Chief Executive Officer of the Company and the
other executive officer of the Company whose total annual salary and
bonus exceeded $100,000 ("named executive officers") during the fiscal
year ended December 31, 1997.

Summary Compensation Table
<TABLE>
<CAPTION>
Long-Term Compensation
-------------------------------------
Annual Compensation Awards Payouts
------------------------------------ ------------------------- -------
Other Restricted Securities All
Annual Stock Underlying LTIP Other
Name and Principal Salary Bonus Compensation Awards Options/SARs Payouts Compen-
Position Year ($) ($) ($) ($) (#) ($) sation
- ------------------ ---- ------ ---- ----------- ------- ------------- ------ -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Bruce A. Hahn (1) 1997 245,819 - 18,000 - 35,000 - -
Chairman, President 1996 200,266 - 18,000 - - - -
Chief Executive Officer 1995 158,000 - 18,000 - 118,437 - -

Robert J. Kostrinsky (2) 1997 145,819 - 9,000 - 5,250 - -
Executive Vice 1996 100,266 - 15,000 - - - -
President, Chief 1995 75,000 - 12,000 - 59,217 -
Financial Officer
<FN>
(1) Salary payments include commissions paid pursuant to Mr. Hahn's employment agreement.
Such commissions totaled $45,819, $266 and $0 for the years ended December 31, 1997, 1996 and
1995, respectively. Mr. Hahn has been Chairman and Chief Executive Officer of U.S.
Communications, Inc since its inception and assumed those positions with the Company upon
completion of the Merger with Trinity on May 15, 1995.
(2) Salary payments include commissions paid pursuant to Mr. Kostrinsky's employment
agreement. Such commissions totalled $55,819, $10,266 and $0 for the years ended December
31, 1997, 1996 and 1995, respectively.
</FN>
</TABLE>

The following table sets forth information concerning option grants
and option holdings for the fiscal year ended December 31, 1997 with
respect to the named executive officers.
Option/SAR Grants in Last Fiscal Year

<TABLE>
<CAPTION>
% of Total Potential Realizable Value
No. of Options/ at Assumed Annual Rates
Securities SARs of Stock Price Alternative
Underlying Granted to Exercise or Appreciation to (f) & (g)
Options/ Employees Base/Market for Option Term ---------------
SARs in Fiscal Price Expiration --------------- Grant Date
Name Granted(#) Year ($/Sh) Date 5%($) 10%($) Present Value $
(a) (b) (c) (d) (e) (f) (g) (h)
<S> <C> <C> <C> <C> <C> <C> <C>
Bruce A. Hahn 35,000 6.7% 6.00/6.938 10/30/02 99,890 181,055 -

Robert J. Kostrinsky 5,350 1.0% 6.00/6.938 10/30/02 15,269 26,676 -

</TABLE>

The following table sets forth information concerning option exercises
and option holdings for the fiscal year ended December 31, 1997 with
respect to the named executive officers.

AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Value
Realized
(Market
price at Value of Unexercised in-
exercise the-money options at FY-
Shares less Number of Securities End (Market price of
acquired on exercise Underlying Unexercised shares at FY-End ($7.00)
Name exercise(#) price ($) Options at FY-End (1) less exercise price)
- ---------------- ----------- ---------- -------------------------- ---------------------------
Exercisable Unexercisable Exercisable Unexercisable
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Bruce A. Hahn - - 153,437 - $413,998 -

Robert J. Kostrinsky - - 59,752 - $194,844 -
</TABLE>

The Company made no Long-Term Incentive Plan Awards during the fiscal year
ended December 31, 1997.

The Company has no defined benefit or actuarial plan.

The Company did not, during the fiscal year ended December 31, 1997, adjust
or amend the exercise price of options previously awarded to the named
executive officers.

Compensation Committee Interlocks and Insider Participation

Lawrence Burstein, a member of the Company's Compensation and
Personnel committee, until his resignation as a director in September 1997,
was an executive officer of Trinity until the Merger in May 1995.

Employment Contracts

In May 1995, Bruce A. Hahn entered into a three-year employment agreement
with the Company, effective retroactively to January 1, 1995, and
subsequently amended in January 1996, which provided for an annual base
salary of $150,000 in 1995, increasing to $200,000 for 1996 and 1997. As
additional compensation, Mr. Hahn is entitled to receive a commission of
$1.00 per net wireless activation (as defined in the agreement ("NWA")) for
NWAs in excess of the first 50,000 and $2.00 per NWA for each NWA in excess
of 100,000. Mr. Hahn receives a monthly car allowance of $1,500 and
reimbursement of business expenses, and is eligible to participate in any
Company sponsored benefit plans. Mr. Hahn also received five-year options,
exercisable at $3.80 per share, to purchase an aggregate of 118,437 shares
of the Company's Common Stock, all of which are vested.

Robert Kostrinsky's employment agreement with the Company provides for an
annual base salary of $75,000 in 1995, increasing to $90,000 for 1996 and
1997. As additional compensation, Mr. Kostrinsky is entitled to receive a
commission for the year ended December 31, 1996 of $1.00 per NWA for NWAs in
excess of the first 40,000 and $1.50 per NWA for each NWA in excess of
100,000. Mr. Kostrinsky receives a monthly car allowance of $750 and
reimbursement of business expenses, and is eligible to participate in any
Company sponsored benefit plans. Mr. Kostrinsky also received five-year
options, exercisable at $3.80 per share, to purchase an aggregate of 59,217
shares of the Company's Common Stock, all of which are vested.

The employment contracts of Messrs. Hahn and Kostrinsky expired on December
31, 1997 and are being renegotiated.

The Company entered into a three year employment agreement with Mario
Martinez ending July 31, 2000 and provides for an annual base salary of
$175,000 in the first year, $200,000 in the second year and $225,000 in the
final year. As additional compensation, Mr. Martinez is entitled to receive
a bonus based on the number of Activations of cellular telephones (including
PCS telephones) and pagers by subscribers to the Company's Ameritel
services. For each of the three calendar years ending December 31, 1999,
the bonus is $0.75 per Activation in excess of 50,000 Activations and $1.25
for each Activation in excess of 100,000 Activations for such year. The
bonus in each year for paging Activations is $0.50 per Activation with a
minimum bonus in each year of $25,000 and a maximum bonus of $350,000 in
1997, $700,000 in 1998 and $1,250,000 in 1999. Mr. Martinez also receives a
monthly car allowance of $1,000 and is eligible to participate in any
Company sponsored benefits plans. Mr. Martinez also received five-year
options to purchase 325,000 shares of the Company's Common Stock at an
exercise price of $3.50 share, of which options covering 150,000 shares
became exercisable immediately and options covering 35,000 shares became
exercisable on December 31, 1997. The options covering the remaining 140,000
shares become exercisable, in installments of 35,000 shares, on each of
December 31, 1998, 1999, 2000 and 2001. Notwithstanding this vesting
schedule, for each $2.00 price increase above the $3.50 exercise price of
the options in the Company's Common Stock as reported on the Nasdaq National
Market system, 20% of the not yet vested options will immediately become
exercisable. As of March 24, 1998, 255,000 options are exercisable. In
addition, provided he is employed by the Company in August 1, 1998 and
August 1, 1999, Mr. Martinez will receive on each date an option to purchase
25,000 shares of the Company's Common Stock, exercisable at a price equal to
the last reported sale price of the Common Stock on such date. The
agreement further provides for payment to Mr. Martinez, in the event of a
change of control of the Company (as defined in the agreement) and the
termination of Mr. Martinez' employment within six months prior to or two
years following such change in control, of certain termination amounts based
on his then current annual salary and bonuses earned prior to termination.
In addition, any unvested stock options would vest immediately.

Performance Graph

The following table shows a comparison of cumulative total return to
stockholders for the Company's Common Stock, the Nasdaq Composite Index and
the Peer Group Composite Index for the period May 15, 1995 (the date of the
Merger with Trinity) through December 31, 1997.
<TABLE>
<CAPTION>
5/15/95 12/31/95 12/31/96 12/31/97
<S> <C> <C> <C> <C>
USCI, Inc. 100.00 184.52 102.38 132.61
Peer Composite 100.00 102.60 90.80 145.94
Nasdaq Telecom Index 100.00 122.78 125.54 185.85
Nasdaq Composite 100.00 122.80 151.04 185.39
</TABLE>

Assumes $100 invested on May 15, 1995 in USCI Common Stock, and the Peer
Composite, the Nasdaq Telecom and the Nasdaq Composite Indices. The USCI
Common Stock is quoted on the Nasdaq National Market. Prior to January 10,
1996, the USCI Common Stock was quoted on the Nasdaq OTC Bulletin Board.
The May 15, 1995 and December 31, 1995 prices for USCI are the average of
the high bid and ask prices on such dates. The Peer Composite is comprised
of Airtouch Communications, Inc., Palmer Wireless, Inc. and Vanguard
Cellular Systems, Inc. Due to the Company's transition from agent to
reseller of wireless communications services, it has elected to change the
Peer Composite to the Nasdaq Telecommunications Index.

Board Recommendation

The Board of Directors recommends that the stockholders vote FOR the
election of the nominees named above.

PROPOSAL 2:

AMENDMENT TO INCREASE THE AUTHORIZED
NUMBER OF SHARES OF PREFERRED STOCK

The Board of Directors has adopted and recommends to the stockholders
for approval, an Amendment ("Amendment") to Article FOURTH of the Company's
Certificate of Incorporation to increase the number of authorized shares of
Preferred Stock to 1,005,000 shares from 5,000.

The Company's current Certificate of Incorporation provides for 5,000
shares of Preferred Stock, of which 1,000 shares are issued and outstanding,
consisting of 500 shares designated as 6% Series A Convertible Preferred
Stock and 500 shares designated as 6% Series B Convertible Preferred Stock.
The proposed Amendment would not change the number of authorized shares of
Common Stock.

As so amended Article FOURTH of the Company's Certificate of
Incorporation would read as follows:

"FOURTH: a) The corporation shall be authorized to issue the
following shares:

Class Number of Shares Par Value
Common 100,000 $.0001
Preferred 1,005,000 $.01

b) The Board of Directors shall have authority to establish
series of unissued shares of Preferred Stock by fixing and determining the
designations, preferences, limitations and relative rights, including voting
rights, of the shares of any series so established to the same extent that
such designations, preferences, limitations and relative rights could be
stated if fully set forth in the Certificate of Incorporation."

The proposed amendment would vest in the Board of Directors the
authority to designate one or more series of Preferred Stock. Such
provisions are often referred to as "blank check" provisions, since they
afford the Board of Directors the flexibility, at any time or from time to
time, without further shareholder approval, to create one or more series of
Preferred Stock and to determine the designations, preferences and
limitations of each such series, including, but not limited to, (i) the
number of shares, (ii) dividend rights, (iii) voting rights, (iv) conversion
privileges, (v) redemption provisions, (vi) sinking fund provisions, (vii)
rights upon liquidation, dissolution or winding up of the Company and (viii)
other relative rights, preferences and limitations of such series. If the
proposed amendment is approved by the shareholders, it will become effective
upon filing and recording a Certificate of Amendment to the Company's
Certificate of Incorporation.

If any series of Preferred Stock authorized by the Board provides for
dividends, such dividends, when and as declared by the Board of Directors
out of any funds legally available therefore, may be cumulative and may have
a preference over the Common Stock as to the payment of such dividends. In
addition, if any series of Preferred Stock authorized by the Board so
provides, in the event of any dissolution, liquidation or winding up of the
Company, whether voluntary or involuntary, the holders of each such series
of the then outstanding Preferred Stock may be entitled to receive, prior to
the distribution of any assets or funds to the holders of Common Stock, a
liquidation preference established by the Board of Directors, together with
all accumulated and unpaid dividends. Depending upon the consideration paid
for Preferred Stock, the liquidation preference of Preferred Stock and other
matters, the issuance of Preferred Stock could therefore result in a
reduction in the assets available for distribution to the holders of Common
Stock in the event of liquidation of the Company. Holders of Common Stock do
not have any preemptive rights to acquire Preferred Stock or any other
securities of the Company.

Board Recommendation

The Board of Directors believes that amending the Certificate of
Incorporation to permit the Board to authorize the issuance of an additional
1,000,000 shares of preferred stock provides the Company with the
flexibility to address potential future financing needs by creating a series
of Preferred Stock customized to meet the needs of any particular
transaction and market conditions. The Company also could issue Preferred
Stock for other corporate purposes such as to raise capital, implement joint
ventures or to make acquisitions. In addition, while the proposed amendment
to authorize additional shares of preferred stock is not designed to deter
or to prevent a change in control, under certain circumstances, the Company
could use the Preferred Stock to create voting impediments or to frustrate
persons seeking to effect a takeover or otherwise gain control of the
Company and thereby to protect the continuity of the Company's management.
In addition, the issuance of additional Preferred Stock at below market
rates would dilute the value of the outstanding securities of the Company.
The Company could also privately place such shares with purchasers who might
favor the Board of Directors in opposing a hostile takeover bid, although
the Company has no present intention to do so. The Company does not
currently have any plans, agreements, commitments or understandings with
respect to the issuance of Preferred Stock with the exception of the
obligation, subject to shareholder ratification, to issue 500 shares of 6%
Series C Convertible Preferred Stock to JNC Opportunity Fund Ltd., as
described in Proposal 5 below.

The approval of the proposed Amendment to the Certificate of
Incorporation requires the affirmative vote of the holders of shares
representing a majority of the outstanding shares of Common Stock and
entitled to vote thereon. The Board of Directors recommends that
stockholders vote for the Amendment to the Certificate of Incorporation.
Unless instructed to the contrary, the enclosed proxy will be voted in favor
of the proposed Amendment.

PROPOSAL 3:

RATIFICATION OF THE $5.5 MILLION PRIVATE PLACEMENT OF
UNSECURED NOTES AND WARRANTS

On November 18, 1997, the Company obtained, through direct and private
negotiations, unsecured loans in the amount of $4.0 million.. The loans
bear interest at 8.5% per annum and were payable on the earlier of December
31, 1997, or completion of the Company's then pending private placement .
As additional consideration for the loans, the Company issued to each of the
lenders a five-year warrant exercisable to purchase up to 400,000 shares of
the Company's Common Stock at an exercise price of $6.00 per share. On
December 30, 1997, the Company issued to each of the lenders an additional
five-year warrant to purchase 200,000 shares of Common Stock at $6.00 per
share in consideration of the lenders' extension of the due date of the
loans until January 31, 1998.

On February 24, 1998, the original agreement between the Company and the
lenders was revised to reflect the private sale by the original lenders,
George Karfunkel and Michael Karfunkel, of $2 million of the principal
amount of the notes at par to Huberfeld Bodner Family Foundation, Inc., and
Laura Huberfeld/Naomi Bodner Partnership. The 1,600,000 warrants issued by
the Company to George Karfunkel and Michael Karfunkel were cancelled and
rescinded together with the $4,000,000 Promissory Notes dated November 18,
1997. The Company issued Convertible Restated Notes as follows: $1,000,000
to George Karfunkel, $1,000,000 to Michael Karfunkel, $1,250,000 to Laura
Huberfeld/Naomi Bodner Partnership and $750,000 to Huberfeld Bodner Family
Foundation, Inc. and provided that, for each month or portion thereof, from
and after November 1, 1997 until the principal of the Convertible Restated
Notes and all accrued interest is paid in full, the Company would issue
100,000 Primary Warrants for each $1 million principal amount outstanding
under the Convertible Restated Notes. To cover the period from November 1,
1997 through July 31, 1998, the Company issued five-year warrants to
purchase 900,000 shares of the Company's Common Stock to each of George
Karfunkel and Michael Karfunkel, five-year warrants to purchase 1,125,000
shares to Laura Huberfeld/Naomi Bodner Partnership and five-year warrants to
purchase 875,000 shares to Huberfeld Bodner Family Foundation (collectively,
the "Primary Warrants"), each Primary Warrant with an exercise price of
$5.00, and each providing for the issuance of one warrant ("Secondary
Warrants") with the same terms and conditions for each Primary Warrant
exercised.

In addition, the agreement provided for the lenders to advance an additional
$1.5 million to the Company evidenced by unsecured convertible notes bearing
interest at the rate of 10% per annum. Between June 23, 1998 and July 16,
1998, the $1.5 million unsecured convertible notes together with accrued
interest were exchanged for 462,637 shares of Common Stock of the Company of
which 223,928 shares were issued to George Karfunkel and 238,709 shares were
issued to Ace Foundation.

All of the Convertible Restated Notes are unsecured and are due and payable
on or before August 1, 1998. The Convertible Restated Notes accrue interest
until maturity at the rate of 8% per annum. The principal and accrued
interest shall be convertible into shares of Common Stock of the Company at
a conversion price equal to the lesser of $5.00 per share or 80% of the
average closing sales price of the Common Stock during the last five trading
days prior to conversion.

On July 29, 1998, the Company agreed to issue 500 shares of 6% Convertible
Preferred Stock in exchange for the Company's $4,000,000 unsecured
Convertible Restated Notes due on or before August 1, 1998. The Convertible
Preferred Shares are convertible into Common Stock based upon the lesser of
(a) 120% of the average per share market value for the five trading days
preceding the conversion date or 85% of the average three lowest market
share values during the 25 days prior to the conversion date with a floor of
not less than $4.00 per share or a ceiling of not more than $6.00 per share.
If the Company does not complete a high yield private offering by October
15, 1998, the Convertible Preferred Shares shall be convertible into shares
of Common Stock at a conversion price equal to the lesser of $5.00 per share
of 80% of the average closing sales price of the Company's Common Stock
during the last five trading days prior to conversion.

Each of the parties have agreed that no conversion of any Note, any shares
of Convertible Preferred Stock and/or exercise of any warrant shall occur to
the extent it causes such person to then be the "beneficial owner", as
defined in Section 13(d) of the Exchange Act, of more than 4.99% of the then
outstanding Common Stock of the Company.

The Company has included the shares of Common Stock issuable upon exercise
of the Primary Warrants, Secondary Warrants and upon conversion of the Notes
in a Form S-3 Registration Statement filed by the Company and declared
effective by the Securities and Exchange Commission on June 2, 1998.

NASD Requirements

For companies listed on the Nasdaq National Market, Rule 4460(i) requires
shareholder approval when a National Market listed company authorizes the
issuance of common stock in a private placement equal to 20% or more of the
number of shares of common stock of the company outstanding before the
issuance at a price which is lower than the higher of book value or market
value of the common stock. Accordingly, stockholder approval is required to
permit the Company to equal or exceed the 20% limitation with respect to the
possible issuance of Common Stock upon conversion of the Convertible Notes
and exercise of the Warrants, and the possible issuance of Common Stock upon
conversion of the Convertible Preferred Stock issuable upon conversion of
the Convertible Restated Notes issued in connection with the loan
transactions.

In the event that the shareholders fail to ratify the private placement, the
Company will be obligated to repay that portion of the Notes which requires
the issuance of Common Stock exceeding the 20% limitation at 125% of the
principal amount of such Notes together with accrued interest thereon.

Reference is made to made to the Private Placement Purchase Agreement dated
February 24, 1998, among the Company, George Karfunkel, Michael Karfunkel,
Huberfeld Bodner Family Foundation, Inc., Laura Huberfeld/Naomi Bodner
Partnership and Ace Foundations, Inc., and the Convertible Restated Notes
and Convertible notes filed as Exhibits to the Company's Current Report on
Form 8-K dated and filed on March 12, 1998, for all of the terms and
conditions thereof.

Reference is also made to the Securities Purchase Agreement, the Certificate
of Designation and the Registration Rights Agreement among the Company,
George Karfunkel, Michael Karfunkel, Huberfeld Bodner Family Foundation,
Inc. and Laura Huberfeld/Naomi Bodner Partnership filed as Exhibits to the
Company's Current Report on Form 8-K dated and filed on July 29, 1998 for
all of the terms and conditions thereof.

Board Recommendation

The Board believes that the issuance of shares of Common Stock upon
conversion of the Convertible Notes, the issuance of share of Convertible
Preferred Stock upon conversion of the Convertible Restated Notes and the
issuance of Common Stock upon exercise of the Warrants issued in the private
placement without regard to the limits of Nasdaq Rule 4460(i) would be in
the best interests of the Company rather than being required to pay the
Noteholders. The Board believes that a forced payment by the Company may
occur at a time when the Company might not have, and could not raise, the
funds necessary to make such payment. The Board believes that it is in the
Company's best interest to have the ability to retain cash for the use of
the Company for other purposes.

Ratification of the private placement requires the affirmative vote of
the holders of shares representing a majority of the outstanding shares of
Common Stock and entitled to vote thereon. The Board of Directors strongly
recommends that the stockholders approve the private placement. Unless
instructed to the contrary, the enclosed proxy will be voted in favor of
this proposal.

PROPOSAL 4:

RATIFICATION OF THE PRIVATE PLACEMENT OF UP TO
$15 MILLION 6% CONVERTIBLE PREFERRED STOCK

On March 24, 1998, the Company entered into a Convertible Preferred
Stock Purchase Agreement with JNC Opportunity Fund Ltd. ("JNC"), an
institutional investor, in direct and private negotiations, under the terms
of which JNC agreed to purchase up to $15 million in convertible preferred
stock of the Company ("Convertible Preferred Stock"), of which $5 million
was funded on March 24, 1998 ("Initial Tranche") and $5 million was funded
on May 7, 1998 ("Second Tranche"). The agreement further provides that at
JNC's election, it may purchase an additional $5 million in Convertible
Preferred Stock of the Company ("Third Tranche").

The Preferred Stock is entitled to a dividend of 6% per annum, payable
quarterly in Common Stock and is convertible, together with accrued
dividends, at a conversion price equal to 120% of the average closing bid
price for 5 trading days immediately preceding the closing date or 85% of
the average of the three lowest closing prices per share of Common Stock for
the 25 trading days preceding the conversion notice. The Convertible
Preferred Stock is redeemable at the option of the Company at the then
applicable conversion price. In addition, JNC received five-year warrants
to purchase 149,522 shares of Common Stock at a purchase price of $6.89 per
share for the Initial Tranche and five-year warrants to purchase 149,522
shares of Common Stock at a purchase price of $5.85 per share for the Second
Tranche. The Company paid a finder's fee of 10% of the gross proceeds of
the Initial and Second Tranches to Wharton Capital Ltd. ("Wharton"), a New
York-based financial consulting firm and an unaffiliated individual.
Wharton Capital also received five-year warrants to purchase 62,500 shares
of Common Stock at a purchase price of $6.89 per share in the Initial
Tranche and five-year warrants to purchase 62,500 shares of Common Stock at
a purchase price of $5.85 per share for the Second Tranche.

The purchase, at JNC's election, of the Third Tranche of $5 million of
Convertible Preferred Stock is subject to the satisfaction of certain
conditions, including, but not limited to the following. For the thirty
trading days prior to the purchase (i) the per share market value of the
Common Stock must be at least $4.00 per share and (ii) the average weekly
dollar volume of the Common Stock must be at least $1 million.

On July 16 and July 17, 1998, JNC converted 50 shares of 6% Series A
Convertible Preferred Stock into 169,266 shares of Common Stock of the
Company.

Pursuant to Nasdaq Rule 4460(i), stockholder approval is required when a
National Market listed company issues common stock in a private placement
equal to 20% or more of the number of shares of common stock outstanding
before the issuance at a price which is lower than the higher of book value
or market value of the Common Stock.. Since the number of shares of Common
Stock issuable upon the conversion of the Preferred Stock is not
determinable, the Company may be required to issue an amount of shares upon
conversion of the Preferred Stock which equals or exceeds the 20% limitation
requiring stockholder approval. In addition, since the transactions
contemplated by the closing of the Third Tranche will be combined with the
closings of the First and Second Tranches for purposes of Rule 4460(i), the
Company must obtain stockholder approval to ensure that it may accept the
Third Tranche if the other conditions thereof are met.

The Company's Form S-3 Registration Statement covering the sale by JNC
of the shares of Common Stock issuable upon conversion of the Preferred
Stock and exercise of the Warrants in addition to other shares of Common
Stock to be sold by selling stockholders was declared effective by the
Securities and Exchange Commission on June 2, 1998.

The terms of the Certificates of Designation with respect to the
Preferred Stock provide that if on any Conversion Date the Preferred
Stockholder is unable to convert any of shares of Preferred Stock because
the Company has not complied with the Nasdaq Rule, the converting
Stockholder has the option to require the Company to pay such Stockholder an
amount equal to the Discount Equivalent or Mandatory Redemption Amount, as
provided in the Certificates of Designation filed by the Company with the
Secretary of State of Delaware. Reference is made to made to the
Convertible Preferred Stock Purchase Agreement between the Company and JNC
filed as an exhibit to the Company's Annual Report on Form 10-K for the year
ended December 31, 1997, and to the Certificates of Designation as part of
the Company's Certificate of Incorporation, filed as an Exhibit to the
Company's Quarterly Report on Form 10-Q for the three months ended March 31,
1998, for all of the terms and conditions thereof.

Board Recommendation

The Board believes it would be in the best interests of the Company if
it could issue the shares of Common Stock issuable upon conversion of the
Convertible Preferred Stock and exercise of the warrants by JNC rather than
redeem the Convertible Preferred Shares. The Board believes that a forced
payment by the Company may occur at a time when the Company might not have,
and could not raise, the funds necessary to make such payment. The Board
desires to have the ability to retain cash for the use of the Company for
other purposes. In addition, the Board believes it is in the best interests
of the Companyto obtain approval of this proposal so that it may consummate
the closing of the Third Tranche, if and when the other conditions thereof
are satisfied.

PROPOSAL 6:

AMENDMENT TO THE COMPANY'S
1997 STOCK OPTION PLAN

The Company presently maintains the USCI, Inc. 1997 Stock Option Plan
(the "1997 Option Plan"), which was originally adopted by the Company's
stockholders on June 26, 1997. On May 18, 1998, the Board of Directors
adopted an amendment to the 1997 Option Plan to increase the number of
shares of Common Stock issuable under the 1997 Option Plan by 1,000,000 to
1,750,000. As of May 18, 1998, options to purchase 505,000 shares had been
granted and are outstanding under the 1997 Option Plan. The proposed
amendment changes only the number of shares available under the 1997 Option
Plan; the other provisions of the 1997 Option Plan are not affected by the
proposed amendment.

Principal Provisions

The principal provisions of the 1997 Option Plan are as follows:

Eligibility. All employees and directors of the Company and its
subsidiaries, and consultants and advisors thereto, are eligible to
receive options under the 1997 Option Plan. Options granted under the
1997 Option plan to employees may be designated as "incentive stock
options" ("ISOs") within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), or may be designated as
options not intended to ISOs ("non-qualified stock options"). Options
granted to directors who are not full-time employees of the Company or
its subsidiaries and to consultants and advisors will be non-qualified
stock options. Approximately 270 individuals were eligible to receive
options under the 1997 Option Plan as of May 1, 1997.

Term of 1997 Option Plan. No option may be granted under the 1997
Option Plan after March 19, 2007.

Administration. The 1997 Option Plan is administered by the
Compensation and Personnel Committee of the Board of Directors (the
"Committee") which determines the persons to whom, and the times and
prices at which, an option will be granted, the number of shares
subject to the option and the terms and provisions of the option
agreement, and which interprets and construes the terms of the 1997
Option Plan.

Term of Options. All options terminate on the earliest of: (a) the
expiration of the term specified in the option document, which may not
exceed ten years from the date of grant; (b) the expiration of three
months from the date an option holder's employment or service with the
Company or its subsidiaries terminates for any reason other than
disability, death or as set forth in clauses (d) and (e) below); (c)
the expiration of one year from the date an option holder's employment
or service with the Company or its subsidiaries terminates by reason
of such option holder's disability or death; (d) the date upon which a
determination is made by the Committee that the option holder has
breached his employment or service contract with the Company or its
subsidiaries, has been engaged in any sort of disloyalty to the
Company or its subsidiaries or has disclosed trade secrets or
confidential information of the Company or its subsidiaries; or (e)
the date set by the Committee to be an accelerated expiration date in
the event of a liquidation or dissolution of the Company or its
subsidiaries. The Committee, in its discretion, may provide for
additional limitations on the term of any option.

Option Price. The option price for non-qualified options may be less
than, equal to or greater than the fair market value of the shares
subject to the option on the date that the option is granted, and for
ISOs shall be at least 100% of the fair market value of the shares
subject to the option on the date that the option is granted.

Certain Rules for Certain Stockholders. If an ISO is granted to an
employee who then owns, directly or by attribution under the Code,
shares possessing more than 10% of the total combined voting power of
all classes of shares of the Company's capital stock, the term of the
option may not exceed five years and the option price must be at least
110% of the fair market value of the shares on the date that the
option is granted.

Limitation on ISO Grants. To the extent that the aggregate fair
market value of the shares of Common Stock (determined at the time the
ISO is granted) with respect to which ISOs under all stock option
plans of the Company and its subsidiaries are exercisable for the
first time by an option holder during any calendar year exceed
$100,000, such options shall be treated as non-qualified options.

Payment. An option holder may pay for shares covered by an option in
cash or by certified or cashier's check payable to the order of the
Company, by payment through a broker in accordance with Regulation T
of the Federal Reserve Board or by such other mode of payment as the
Committee may approve, including payment in whole or in part in shares
of the Company's Common Stock, based on the fair market value of such
Common Stock at the time of payment.

Option Document; Restriction on Transferability. All options will be
evidenced by a written option document containing provisions
consistent with the 1997 Option Plan and such other provisions as the
Committee deems appropriate. No option granted under the 1997 Option
Plan may be transferred, except by will, the laws of descent and
distribution or pursuant to a qualified domestic relations order, as
defined by the Code or in Title I of the Employee Retirement Income
Security Act of 1974, as amended.

Provisions Relating to a "Change of Control." Notwithstanding any
other provision of the 1997 Option Plan, upon the occurrence of a
"Change of Control," all options granted pursuant to the 1997 Option
Plan will become immediately exercisable.

A "Change of Control" will occur under the 1997 Option Plan upon
requisite approval by stockholders (or, if such approval is not
required, by the Board of Directors) of a plan of liquidation or
dissolution or the sale of substantially all of the assets of the
Company. Subject to certain exceptions, a "Change of Control" will
also occur upon requisite approval by the Company's and the other
constituent corporation's stockholders (or, if such approval is not
required, by the respective Boards of Directors) of the merger or
consolidation of the Company with or into such other constituent
corporation. In addition, a Change of Control will occur if certain
entities, persons or groups specified in the 1997 Option Plan have
become beneficial owners of or have obtained voting control over more
than 30% of the outstanding shares of the Company's Common Stock or on
the first day upon which a majority of the Board of Directors consists
of persons who have been members of the Board for less than two years,
unless the nomination for election of each new director who was not a
director at the beginning of such period was approved by a vote of at
least two-thirds of the directors then still in office who were
directors at the beginning of such period.

Amendments to option documents and the 1997 Option Plan. Subject to
the provisions of the 1997 Option Plan, the Committee may amend an
option document, subject to the option holder's consent if the
amendment is not favorable to the option holder or is not being made
pursuant to provisions of the 1997 Option Plan relating to
acceleration of the expiration date in the event of liquidation or
dissolution of the Company. The Board of Directors may amend the 1997
Option Plan from time to time in such manner as it may deem advisable
without further action by the Company's stockholders except to the
extent required under applicable law.

Tax Aspects of the 1997 Option Plan. The following discussion is
intended to briefly summarize the general principles of federal income
tax law applicable to options granted under the 1997 Option Plan. A
recipient of an ISO will not recognize taxable income upon either the
grant or exercise of an ISO. The option holder will recognize long-
term capital gain or loss on a disposition of the shares acquired upon
exercise of an ISO, provided the option holder does not dispose of
those shares within two years from the date the ISO was granted or
within one year after the shares were transferred to such option
holder. Currently, for regular federal income tax purposes, long-term
capital gain is taxed at a maximum rate of 28%, while ordinary income
may be subject to a maximum rate of 39.6%. If the option holder
satisfies both of the foregoing holding periods, then the Company will
not be allowed a deduction by reason of the grant or exercise of an
ISO.

As a general rule, if the option holder disposes of the shares before
satisfying both holding period requirements (a "disqualifying disposition"),
the gain recognized by the option holder on the disqualifying disposition
will be taxed as ordinary income to the extent of the difference between (i)
the lesser of the fair market value of the shares on the date of exercise or
the amount received for the shares in the disqualifying disposition; and
(ii) the adjusted basis of the shares, and the Company will be entitled to a
deduction in that amount. The gain (if any) in excess of the amount
recognized as ordinary income on a disqualifying disposition will be long-
term or short-term capital gain, depending on the length of time the option
holder held the shares prior to the disposition.

The amount by which the fair market value of a share at the time of
exercise exceeds the option price will be included in the computation of
such option holder's "alternative minimum taxable income" in the year the
option holder exercises the ISO. Currently, the alternative minimum tax
rate is 24%. If an option holder pays alternative minimum tax with respect
to the exercise of an ISO, then the amount of such tax paid will be allowed
as a credit against regular tax liability in subsequent years. The option
holder's basis in the shares for purposes of the alternative minimum tax
will be adjusted when income is included in alternative minimum taxable
income.

A recipient of a non-qualified stock option will not recognize taxable
income at the time of grant, and the Company will not be allowed a deduction
by reason of the grant. Such an option holder will recognize ordinary
income in the taxable year in which the option holder exercises the non-
qualified stock option, in an amount equal to the excess of the fair market
value of the shares received upon exercise at the time of exercise of such
options over the exercise price of the option, and the Company will be
allowed a deduction in that amount. Upon disposition of the shares subject
to the option, an option holder will recognize long-term or short-term
capital gain or loss, depending upon the length of time the shares were held
prior to disposition, equal to the difference between the amount realized on
disposition and the option holder's basis in the shares subject to the
option (which basis ordinarily is the fair market value of the shares
subject to the option on the date the option was exercised).

The preceding discussion is based upon federal tax laws and
regulations in effect on the date of this Proxy Statement, which are subject
to change, and does not purport to be a complete description of the federal
tax aspects of the 1997 Option Plan. Option holders may also be subject to
state and local taxes in connection with the grant or exercise of options
granted under the 1997 Option Plan and the sale or other disposition of
shares acquired upon exercise of options.

Board Recommendation

The 1997 Option Plan is intended to recognize the contributions made
to the Company by its employees, members of the Board of Directors and
certain consultants and advisors to the Company, to provide such persons
with additional incentive to devote themselves to the future success of the
Company, and to improve the ability of the Company to attract, retain and
motivate individuals upon whom the Company's sustained growth and financial
success depend, by providing such persons with an opportunity to acquire or
increase their proprietary interest in the Company through receipt of rights
to acquire the Company's Common Stock. The Board of Directors recommends
that stockholders vote FOR the Amendment to the 1997 Option Plan. Unless
instructed to the contrary, the enclosed proxy will be voted in favor of the
proposed Amendment. The affirmative vote by the holders of a majority of
the shares of Common Stock present in person or represented by proxy and
entitled to vote on the matter is required to approve the adoption of the
1997 Option Plan.

PROPOSAL 7:

ADOPTION OF THE COMPANY'S
1998 STOCK PURCHASE PLAN

On January 21 1998, the Board of Directors of the Company adopted the
USCI, Inc. 1998 Employee Stock Purchase Plan (the "1998 Purchase Plan") and
allocated 250,000 shares of Common Stock of the Company, par value $.0001
per share, to be reserved for issuance and sale thereunder, subject to the
approval of the Company's shareholders. The purpose of the 1998 Purchase
Plan is to provide eligible employees of the Company with the opportunity to
purchase the Company's Common Stock through payroll deductions. In order to
qualify for treatment as an "employee stock purchase plan" under Section 423
of the Internal Revenue Code of 1986, as amended, the 1998 Purchase Plan
must, among other things, be approved by the holders of a majority of the
Company's outstanding shares of Common Stock within 12 months after its
adoption by the Board of Directors.

Description of the USCI, Inc. 1998 Employee Stock Purchase Plan

The following description of the 1998 Purchase Plan is a summary of
its terms. The full text of the 1998 Purchase Plan is included herein as
Appendix "A."

Under the terms of the 1998 Purchase Plan, shares of the Company's
Common Stock will be offered to eligible employees who elect to
participate in the 1998 Purchase Plan.

Participation is voluntary for any employee of the Company who has
completed one (1) year of continuous service or has been employed at
least two (2) years with the Company.

Participants will elect to have a portion of their salary (not more
than 10% and not less than 2%) withheld for purposes of purchasing
shares of Common Stock on their behalf. Any participant who has not
discontinued his payroll deductions will have his payroll deductions
used to purchase Common Stock of the Company on his behalf. The
aggregate number of shares of Common Stock which may be purchased by
all eligible employees pursuant to the 1998 Purchase Plan is 250,000
shares. Such shares may be authorized but unissued shares of Common
Stock or shares purchased by the Company in the open market.

The purchase price at which Common Stock of the Company will be sold
to a participant will be determined by the Administrative Committee
which will not be less than 85% of the lesser of (a) the fair market
value of the shares on the first business day in an Offering Period;
or (b) the fair market value of the shares on the last business day of
such Offering Period.

The Board may at any time amend or terminate the 1998 Purchase Plan
except that no amendment may accomplish any of the following without
the approval of the Company's shareholders: (a) Increase the number of
shares reserved for purposes of the Plan or (b) Allow any person who
is not an eligible employee to become a participant.

Board Recommendation

The purpose of the 1998 Purchase Plan is to provide eligible employees
of the Company, and its subsidiaries whose employees are permitted to
participate in the 1998 Purchase Plan, with an opportunity to purchase
Common Stock of the Company, and thereby, acquire a proprietary interest in
the Company. The Plan provides an entirely voluntary method of purchasing
shares of Common Stock of the Company in convenient installments by payroll
deductions. Its operation should bring about increasing mutuality of
interests between employees and stockholders and thus aid in the continued
development of the Company. In addition, the Plan will provide a readily
available savings and investment program to assist in accumulating financial
security for the future, although permitting earlier withdrawals. The
approval of the proposed 1998 Purchase Plan requires the affirmative vote of
the holders of shares representing a majority of the outstanding shares of
Common Stock and entitled to vote thereon. The Board of Directors
recommends that stockholders vote FOR the 1998 Purchase Plan. Unless
instructed to the contrary, the enclosed proxy will be voted in favor of
adopting the 1998 Purchase Plan.

PROPOSAL 8:

RATIFICATION OF ARTHUR ANDERSEN LLP AS INDEPENDENT ACCOUNTANTS

The Board of Directors has concluded that the continued employment of
Arthur Andersen LLP will be in the Company's best interest and recommends
that the appointment of Arthur Andersen LLP as the Company's independent
public accountants for the fiscal year ending December 31, 1998 be ratified
and approved.

Representatives of Arthur Andersen LLP are expected to be present at
the Annual Meeting and will have the opportunity to make a statement if they
desire to do so and are expected to be available to respond to appropriate
questions.

The Company has been advised by Arthur Andersen LLP that neither the
firm nor any of its partners has any material direct or any indirect
financial interest in the Company.

Board Recommendation

The affirmative vote by the holders of a majority of the shares of
Common Stock present in person or represented by proxy and entitled to vote
on the matter is required to ratify the appointment of Arthur Andersen LLP
as independent accountants.

The Board of Directors recommends that the stockholders vote FOR
ratification of the appointment of Arthur Andersen LLP as independent public
accountants.

EXPENSE OF SOLICITATION

All costs connected with the solicitation of Proxies will be borne by
the Company. Brokers and other persons holding stock for the benefit of
others will be reimbursed for their expenses in forwarding Proxies and
accompanying material to the beneficial owners of such stock and obtaining
their Proxies. Solicitation will be made by mail, telephone, telegraph or
otherwise, and some of the directors, officers and regular employees of the
Company may assist in the solicitation without additional compensation.

STOCKHOLDERS' PROPOSALS

If a stockholder wishes to present a proposal to be voted on at the
1999 Annual Meeting, the proponent must, at the time the proposal is
submitted, be a record or beneficial owner of at least one (1%) percent or
One Thousand ($1,000.00) Dollars in market value of the class of securities
entitled to vote at the meeting and have held such securities for at least
one (1) year, and such stockholder must continue to own such securities
through the date on which the 1999 Annual Meeting is held. The proposal, in
order to be included in the management proxy statement, must be received at
the Company's executive offices no later than February 1, 1999. In order to
remove any question as to the date on which a proposal was received by the
Board of Directors, it is suggested that proposals be submitted by certified
mail, return receipt requested.

OTHER MATTERS THAT MAY COME BEFORE THE MEETING

The Board of Directors knows of no other matters which may be
presented at the Annual Meeting, but if other matters do properly come
before the Annual Meeting, it is intended that the persons named in the
Proxy will vote according to their best judgment.

Stockholders are requested to date, sign and return the Proxy in the
enclosed envelope, to which no postage need be affixed if mailed in the
United States. If you attend the Annual Meeting, you may revoke your Proxy
at that time and vote in person if you so desire, otherwise your Proxy will
be voted for you.

By Order of the Board of Directors

Bruce A. Hahn, Chairman

August __, 1998
Norcross, Georgia

<PAGE>

APPENDIX A

USCI, INC

Employee Stock Purchase Plan

<PAGE>

USCI, INC.

1998 EMPLOYEE STOCK PURCHASE PLAN

Article 1

Introduction

Section 1.01 Establishment and Purpose of Plan. The USCI, Inc.
1998 Employee Stock Purchase Plan ("Plan") is established to provide
eligible employees of USCI, Inc. (the "Corporation"), and its
subsidiaries whose employees are permitted to participate in the Plan,
with an opportunity through payroll deductions to purchase common
stock of the Corporation and, thereby, acquire a proprietary interest
in the Corporation. It is believed that the Plan will stimulate
employee participation in ownership which will be to the mutual
benefit of both the Corporation and its employees.

Section 1.02 Internal Revenue Code Considerations. The Plan is
intended to constitute an "employee stock purchase plan" within the
meaning of Section 423 of the Internal Revenue Code of 1986, as
amended ("Code"). The provisions of the Plan shall be construed so
as to extend and limit participation in a manner consistent with the
requirements of that section of the Code.

ARTICLE II

Definitions

Whenever used herein, the following words and phrases shall have
the meaning stated below unless a different meaning is plainly
required by the context.

Section 2.01 "Administrative Committee" means the committee
appointed by the Board of Directors to administer the Plan, as
provided in Section 8.03 hereof.

Section 2.02 "Board of Directors" means the Board of Directors
of the Corporation.

Section 2.03 "Code" means the Internal Revenue Code of 1986, as
amended, and any successor statute of similar nature. References to
specific sections of the Code shall be taken to be references to
corresponding sections of any successor statute.

Section 2.04 "Compensation" with respect to any Employee means
the total regular salary or wages paid, during the period of
reference, to an Employee by an Employer. For purpose of this
Section, the determination of Compensation shall be made by:

(a) excluding reimbursements or other expense allowances, fringe
benefits (cast or non-cash), moving expenses, deferred
compensation and welfare benefits;

(b) excluding overtime, bonuses and commissions; and

(c) including amounts which are contributed by an Employer
pursuant to a salary reduction agreement under any Code
Section 125 or 401 (k) plan sponsored by the Employer.

Section 2.05 "Continuous Service" means the designated periods
of time immediately preceding the Offering Date during which the
Employee has been employed by an Employer and during which there has
been no interruption of the Employee's employment with the Employer.
For this purpose, periods of Excused Absence shall not be considered
interruptions of Continuous Service.

Section 2.06 "Corporation" means USCI, Inc., a Delaware
corporation.

Section 2.09 "Eligible Employees" means each individual who, on
an Offering Date is:

(a) An Employee of an Employer; and

(b) Has completed with the Employer at least one (1) year
of Continuous Service or has been employed at least
two (2) years.

Notwithstanding the foregoing to the contrary, any individual who is
deemed for purposes of Section 423(b)(3) of the Code to own stock
possessing five percent (5%) or more of the total combined voting
power or value of all classes of stock of an Employer or of its parent
or subsidiary corporation shall not be eligible to participate in the
Plan.

Section 2.10 "Employee" means each individual employed by an
Employer.

Section 2.11 "Employer" means the Corporation and any current
or future parent and/or subsidiary corporation as defined in Sections
424(e) and 424(f) of the Code that, with the consent of the Board of
Directors, is permitted to have its employees become participants
herein.

Section 2.12 "Enrollment Form" means the instrument prescribed
by the Administrative Committee pursuant to which an Eligible Employee
enrolls to be a Participant in the Plan.

Section 2.13 "Exchange Act" means the Securities Exchange Act
of 1934, as amended.

Section 2.14 "Excused Absence" means absence pursuant to a
leave of absence granted by an Employer, absence due to disability or
illness, absence by reason of a layoff, or absence by reason of active
duty in the armed forces of the United States. In no event may an
Excused Absence exceed twelve (12) weeks in length (or, if longer and
if applicable, the period of the individual's active duty in the armed
forces of the United States and such period thereafter as such
individual's right to reemployment by the Employer is protected by
law), and any absence shall cease to be an Excused Absence upon the
earlier of (i) the last day of the calendar month in which the
duration of the absence reaches twelve (12) weeks or (ii) the last day
of the calendar month in which the leave expires by its terms, the
layoff ends by recall or permanent separation from service, or
recovery from illness or disability occurs.

Section 2.15 "Exercise Date" shall mean the last day of each
Offering Period of the Plan if such date is a regular business day or
the first regular business day thereafter. A different date may be
set by the Administrative Committee.

Section 2.16 "Market Value" per share of Stock shall mean the
following: If the Stock is traded in a public market, then the Market
Value per share shall be, if the Stock is listed on a national
securities exchange or included in the Nasdaq National Market, the
last reported sale price thereof on the relevant date or, if the Stock
is not so listed or included, the mean between the last reported "bid"
and "asked" prices thereof on the relevant date, as reported on Nasdaq
or, if not so reported, as reported by the National Daily Quotation
Bureau, Inc. or as reported in a customary financial reporting
service, as applicable, or, if not so reported, as determined by the
Administrative Committee, which determination shall be conclusive and
binding on all persons.

Section 2.17 "Offering" means the offering of shares of Stock
under the Plan.

Section 2.18 "Offering Date" shall mean the first day of each
Offering Period of the Plan if such date is a regular business day or
the first regular business day thereafter. A different date may be
set by the Administrative Committee.

Section 2.19 "Offering Period" shall have the meaning set forth
in paragraph (a) of Section 4.02 hereof.

Section 2.20 "Participant" means each Eligible Employee who
elects to participate in the Plan through the execution of an
Enrollment Form.

Section 2.21 "Plan" means the USCI, Inc. 1998 Employee Stock
Purchase Plan, as the same is set forth herein and may hereafter be
amended.

Section 2.22 "Stock" means the common stock of the Corporation.

Section 2.23 "Stock Purchase Account" means a non-interest
bearing account consisting of al amounts withheld from a Participant's
Compensation for the purpose of purchasing shares of Stock for such
Participant under the Plan reduced by all amounts applied to the
purchase of Stock for such Participant under the Plan. The amounts
withheld shall be deposited with the general funds of the Corporation
and may be used by the Corporation for any corporate purpose. No
interest shall be paid or payable with the respect to any amount held
in a Participant's Stock Purchase Account.

ARTICLE III

Participation

Section 3.01 Initial Participation. Any Employee who is an
Eligible Employee on an Offering Date shall become a Participant in
the Offering Period that begins on that Offering Date by executing and
delivering to the Administrative Committee an Enrollment Form on or no
more that thirty (30) days prior to that Offering Date. An Eligible
Employee who does not timely execute and deliver an Enrollment Form
for an Offering Period shall not participate in the Pan for that
Offering Period of for any subsequent Offering Period unless such
Eligible Employee executes and delivers a timely Enrollment Form for a
subsequent Offering Period.

Section 3.02 Continued Participation. A Participant shall
automatically participate in each successive Offering Period until
such time as such Participant's participation is ended as provided
herein. A Participant is not required to file any additional
Enrollment Forms for subsequent Offering Periods in order to continue
to participate in the Plan.

Section 3.03 Voluntary Discontinuance of Participation. Any
Participant may voluntarily withdraw from the Plan by executing and
delivering a notice of withdrawal with the Administrative Committee.
The withdrawal shall be effective upon receipt, except that any
withdrawal received on an Exercise Date will be effective on the next
day. The amount, if any, standing to the Participant's credit in his
Stock Purchase Account shall be refunded to the Participant within
thirty (30) days of the date of withdrawal.

Section 3.04 Automatic Discontinuance of Participation. If a
Participant ceases to be an Eligible Employee, the Participant's
participation in the Plan shall immediately end, except that if such
date is the Exercise Date, the withdrawal shall be effective on the
next day. The amount, if any, standing to the Participant's credit in
his Stock Purchase Account shall be refunded to the Participant within
thirty (30) days of the date of withdrawal.

Section 3.05 Readmission to Participation. Any Employee who has
previously been a Participant, whose participation has been
discontinued, and who desires to be reinstated as a Participant, may
again become a Participant by executing and delivering to the
Administrative Committee an Enrollment Form on or no more than thirty
(30) days prior to any Offering Date, and in such event, the Employee
shall again become a Participant on that Offering Date. The Employee
may not resume participation in the Plan during the Offering Period in
which his participation ended.

ARTICLE IV

Stock Purchase

Section 4.01 Reservation of Shares. There shall be 250,000
shares of Stock reserved for the Plan. Subject to adjustment in
accordance with the anti-dilution provisions hereinafter se forth in
Section 5.02, the aggregate number of shares that may be purchased
under the Plan shall not exceed the number of shares reserved for the
Plan. The shares of Stock may be (i) treasury or newly issued shares
of the Corporation or (ii) purchased by the Corporation on the open
market.

Section 4.02 Offering Periods/Grant of Option.

(a) The Plan shall be implemented by one offering during
each six-month period (each, an "Offering Period"). Offering Periods
shall commence on or about May 1 and November 1 of each year as
determined by the Board; provided, however, that the first Offering
Period under the Plan may be less than six months. The Administrative
Committee shall have the power to change the duration of Offering
Periods with respect to future offerings without shareholder approval
if such change is announced at least 15 days prior to the scheduled
beginning of the first Offering Period to be affected.

(a) On each Offering Date, an option shall be given to
each Participant to purchase that number of shares of Stock arrived at
by dividing the total amount of the Participant's expected payroll
deductions during the Offering Period (determined by multiplying the
payroll deductions withheld during the first pay period of the
Offering Period by the number of pay periods during the Offering
Period) by the Market Value of the shares of Stock on that date as
determined by the Administrative Committee.

Section 4.03 Limitation on Shares Available. The maximum number
of shares of Stock that may be purchased for each Participant on an
Exercise Date is the lesser of (i) the maximum number of shares which
the Participant may purchase under Section 4.02, (ii) the number of
shares of Stock that can be purchased by applying the full balance of
the Participant's Stock Purchase Account to such purchase of shares at
the Purchase Price (as hereinafter determined) or (iii) the
Participant's proportionate part of the maximum number of shares of
Stock available within the limitation established by the maximum
aggregate number of such shares reserved for the Plan, as stated in
Section 4.01 hereof. Notwithstanding the foregoing, if any person
entitled to purchase shares pursuant to any Offering hereunder would
be deemed for the purposes of Section 423(b)(3) of the Code to own
stock (including any number of shares that such person would be
entitled to purchase hereunder) possessing five percent (5%) or more
of the total combined voting power or value of all classes of stock of
an Employer, the maximum number of shares that such person shall be
entitled to purchase pursuant to the Plan shall be reduced to that
number which, when added to the number of shares of Stock that such
person is so deemed to own (excluding any number of shares that such
person would be entitled to purchase hereunder), is one less than such
five percent (5%). Any portion of a Participant's Stock Purchase
Account that cannot be applied by reason of the foregoing limitation
shall remain in the Participant's Stock Purchase Account for
application to the purchase of Stock in the next Offering (unless
properly withdrawn).

Section 4.04 Purchase Price of Shares. The Purchase Price at
which shares of Stock shall be sold in any Offering under the Plan
shall be set by the Administrative Committee; provided, however, that
the purchase price per share of Stock shall not be less than eighty-
five percent (85%) of the lesser of (i) the Market Value per share of
Stock on the Offering Date or (ii) the Market Value per share of Stock
on the Exercise Date. Unless otherwise provided by the Administrative
Committee prior to the commencement of an Offering Period, the
purchase price for an Offering Period shall be as set forth above,
plus any transfer or other fees imposed on the transaction pursuant to
which such share of Stock is purchased. In no event shall the
Purchase Price be less than the par value of the Stock.

Section 4.05 Exercise of Purchase Privilege.

(a) Subject to the provisions of Section 4.03 and of
paragraph (b) of this Section 4.05, if on any Exercise Date there is
an amount standing to the credit of the Participant in the
Participant's Stock Purchase Account, there shall be purchased for the
Participant at such Purchase Price the number of whole shares of Stock
as can be purchased with the amount then standing to the Participant's
credit in the Stock Purchase Account. Each such purchase shall be
deemed to have occurred on the Exercise Date occurring at the close of
the Offering Period for which the purchase was made.

(b) As determined in accordance with Section 423(b) (8) of
the Code, no Participant shall be granted an option which permit his
or her rights to purchase shares of Stock under this Plan and any
similar plans of the Employer to accrue at a rate which exceeds
Twenty-Five Thousand Dollars ($25,000) Market Value of such shares
(determined at the time such option is granted) for each calendar year
in which such option is outstanding any time.

(c) As soon as practicable following the end of each
Offering Period, the Participant shall receive a Plan Account
statement setting forth the amount of payroll deductions, the purchase
price, the number of shares of Stock purchased and the remaining cash
balance, if any.

Section 4.06 Establishment of Stock Purchase Account.

(a) Payroll Deductions. Each Participant shall authorize
payroll deductions from Compensation for the purpose of funding his
Stock Purchase Account. In the Enrollment Form, each Participant
shall authorize a deduction from each payment of his Compensation,
which deduction shall not be more than ten percent (10%) of the gross
amount of such payment, rounded to the next highest whole dollar
amount. The minimum deduction for a Participant is two percent (2%)
per paycheck. Payroll deductions shall commence on the first pay day
during the Offering Period and shall continue to the end of the
Offering Period unless sooner altered or terminated as provided in the
Plan.

(b) Change in Payroll Deduction Rate. A Participant may
decrease (but not increase) the rate of payroll deductions during an
Offering Period by filing with the Corporation a new authorization for
payroll deductions, in which case the new rate shall become effective
within fifteen (15) business days after the Corporation's receipt of
the authorization. Such change in the rate of payroll deductions may
be made at any time during an Offering Period, but not more that one
change may be made in any Offering Period. A Participant may increase
or decrease the rate of payroll deductions for any subsequent Offering
Period by filing with the Corporation a new Enrollment Form on or
prior to the Offering Date with respect to such subsequent Offering
Period.

Section 4.07 Payment for Stock. The Purchase Price for all
shares of Stock purchased by a Participant under the Plan shall be
paid out of the Participant's Stock Purchase Account. As of each
Exercise Date, the amount standing to the credit of each Participant
in the Stock Purchase Account on the Exercise Date for the Offering
that expires on such Exercise Date shall be charged with the aggregate
Purchase Price of the whole number of shares of Stock purchased by
such Participant on the Exercise Date. The remaining balance standing
to the Participant's credit in the Stock Purchase Account shall remain
credited to such Stock Purchase Account for the next succeeding
Offering under the Plan, if any, and, if none, shall be refunded to
the Participant within thirty (30) days of the Exercise Date. No
interest shall be paid or payable with respect to any amount held in
the Participant's Stock Purchase Account.

Section 4.08 Share Ownership. The shares of Stock purchased by a
Participant on an Exercise Date shall, for all purposes, be deemed to
have been issued and/or sold at the close of business on such Exercise
Date. Prior to that time, none of the rights or privileges of a
shareholder of the Corporation shall inure to the Participant with
respect to such shares. Shares of Stock purchased by a Participant
shall be represented by one or more global certificates registered in
the name of the Administrative Committee or its nominee as agent for
Participants in the Plan and credited to the account of each
Participant as appropriate

Section 4.09 Issuance of Certificates to a Participant.

(a) The Corporation shall issue certificates for shares of
Stock credited to a Participant's account upon the Participant's
written request. Such shares shall then be issued to the participant
and withdrawn from his/her account under the Plan. Certificates for
fractional shares will not be issued.

(b) Upon a Participant ceasing to be a Participant in the
Plan, the Corporation shall cause to be issued certificates for shares
purchased by the Participant and deliver such certificates to the
Participant within thirty (30) days of the Participant's withdrawal
from the Plan. Certificates for fractional shares will not be issued.
Any fractional shares will be paid for in cash by the Corporation
upon a Participant's withdrawal. The cash payment for any fractional
share shall be based on the Market Value per share on the next
business day on which the Stock is trading following the day on which
the withdrawal request is effectively processed by the Corporation.

ARTICLE V

Special Adjustments

Section 5.01 Shares Unavailable. If, on any Exercise Date, the
aggregate funds available for the purchase of Stock would purchase a
number of shares in excess of the number of shares then available for
purchase under the Plan, the following events shall occur:

(a) The number of shares that would otherwise be purchased
by each Participant shall be proportionately reduced on the Exercise
Date in order to eliminate such excess;

(b) The Plan shall automatically terminate immediately
after the Exercise Date as of which the supply of available shares is
exhausted; and

(c) Any amount remaining in the Stock Purchase Account of
each of the Participants shall be repaid or produced within thirty
(30) days.

Section 5.02 Anti-Dilution Provisions. The aggregate number of
shares of Stock reserved for purchase under the Plan, as hereinabove
provided, and the calculation of the Purchase Price per share may be
appropriately adjusted to reflect any increase or decrease in the
number of issued shares of Stock resulting from a subdivision or
consolidation of shares or other capital adjustment, or the payment of
a stock dividend, or other increase or decrease in such shares, if
effected without receipt or consideration by the Corporation. Any
such adjustment shall be made by the Administrative Committee acting
with the consent of, and subject to the approval of, the Board of
Directors.

Section 5.03 Effect of Certain Transactions. Subject to any
require action by the shareholders, if the Corporation shall be the
surviving or resulting corporation in any merger or consolidation, any
Offering hereunder shall pertain to and apply to the shares of Stock
of the Corporation. However, in the event of a dissolution or
liquidation of the Corporation, or of a merger or consolidation in
which the Corporation is not the surviving or resulting corporation,
the Plan and any Offering hereunder shall terminate upon the effective
date of such dissolution, liquidation, merger or consolidation, and
the balance then standing to the credit of each Participant in the
Stock Purchase Account shall be returned to the Participant.

ARTICLE VI

Restrictions on Participants
Subject to Short-Swing Profit Rules

Notwithstanding any provision of this Plan to the contrary, with
respect to Participants subject to Section 16 of the Exchange Act, all
transactions in shares of Stock must be transacted in accordance with
Section 16 of the Exchange Act and the rules promulgated thereunder.
To the extent any provision of the Plan or action by the
Administrative Committee fails to so comply, it shall be deemed null
and void, to the extent permitted by law and deemed advisable by the
Administrative Committee. Moreover, in the event the Plan does not
include a provision required by Rule 16b-3 to be stated therein, such
provision shall be deemed automatically to be incorporated by
reference into the Plan.

ARTICLE VII

Approval of Stockholders

This Plan shall be subject to approval by the holders of the
common stock of the Corporation at a duly called meeting of the
stockholders, which approval must occur within the period ending
twelve (12)months after the date on which this Plan was adopted by the
Board of Directors.

ARTICLE VIII

Miscellaneous

Section 8.01 Non-Alienation. The option or right to purchase
shares of Stock under the Plan is personal to the Participant, is
exercisable only by the Participant during the Participant's lifetime
while employed, except as hereinafter set forth, and may not be
assigned or otherwise transferred by the Participant. Notwithstanding
the foregoing, there shall be delivered to the executor, administrator
or other personal representative of a deceased Participant such shares
of Stock and such residual balance as may remain in the Participant's
Stock Purchase Account as of the time the Corporation becomes aware of
the Participant's death, including shares of Stock purchased as of
that date or prior thereto with moneys withheld from the Participant's
Compensation.

Section 8.02 Administrative Costs. The Corporation shall pay all
administrative expenses associated with the operation of the Plan. No
administrative charges shall be levied against the Stock Purchase
Accounts of the Participants.

Section 8.03 Administrative Committee. The Board of Directors
shall appoint an Administrative Committee, which shall have the
authority and power to administer the Plan and to make, adopt,
construe, and enforce rules and regulations not inconsistent with the
provisions of the Plan. The Administrative Committee has the
authority to delegate the day-to-day administration of the Plan. Each
member of the Administrative Committee shall be a "disinterested
person" as such term is defined in Rule 16b-3 under the Exchange Act.
The members of the Administrative Committee are not eligible to
participate in the Plan. The Administrative Committee's
interpretations and decisions in respect of the Plan, the rules and
regulations pursuant to which it is operated, and the rights of
Participants hereunder shall be final and conclusive.

Section 8.04 Amendment of the Plan. The Board of Directors may,
at any time and from time to time, amend the Plan in any respect,
except that no amendment may accomplish any of the following without
the approval of the Corporation's shareholders:

(a) increase the number of shares reserved for purposes of
the Plan; or

(b) allow any person who is not an Eligible Employee to
become a Participant.

Section 8.05 Repurchase of Stock. The Corporation shall not be
required to purchase of repurchase from any Participant any of the
shares of Stock that the Participant acquired under the Plan.

Section 8.06 Notice. An Enrollment Form and any notice that a
Participant files pursuant to the Plan shall be on the form prescribed
by the Administrative Committee and shall be effective only when
received by the Administrative Committee. Delivery of such forms may
be made by hand or by certified mail, sent postage prepaid, to USCI,
Inc., 6115-A Jimmy Carter Blvd., Norcross, Georgia 30071, Attention:
Human Resources Manager. Delivery by any other mechanism shall be
deemed effective at the option and discretion of the Administrative
Committee.

Section 8.07 Government Regulation. The Corporation's obligation
to sell and to deliver the Stock under the Plan is at all time subject
to al approvals of any governmental authority required in connection
with authorization, issuance, sale or delivery of such Stock.

Section 8.08 Headings, Captions, Gender. The headings and
captions herein are for convenience of reference only and shall not be
considered as part of the text. The masculine shall include the
feminine, and vice versa.

Section 8.09 Severability of Provisions; Prevailing Law. The
provisions of the Plan shall be deemed severable. In the event any
such provision is determined to be unlawful or unenforceable by a
court of competent jurisdiction or by reason of a change in an
applicable statute, the Plan shall continue to exist as though such
provision had never been included therein (or, in the case of a change
in an applicable statute, had been deleted as of the date of such
change). The Plan shall be governed by the laws of the State of
Delaware, to the extent such laws are not in conflict with, or
superseded by, federal law.

Section 8.10 Right to Terminate Employment. Nothing in the Plan or
any agreement entered into pursuant to the Plan shall confer upon any
Employee the right to continue in the employment of the Corporation or
any subsidiary or affect any right which the Corporation or any
subsidiary may have to terminate the employment of such Employee.

<PAGE>
PROXY

USCI, INC.
1998 ANNUAL MEETING OF STOCKHOLDERS
This Proxy is Solicited on Behalf of the Board of Directors

The undersigned hereby appoints Leonard R. Glass and Robert J.
Kostrinsky and each of them, the true and lawful attorneys and agents
for the undersigned, with full power of substitution, for and in
the name of the undersigned, to act for the undersigned and vote
all stock the undersigned is entitled to vote at the 1998 Annual
Meeting of Stockholders of USCI, Inc. to be held on _______,
September __, 1998 at 9:00 a.m., local time, at the Grand Hyatt Hotel,
3300 Peachtree Rd., Atlanta, Georgia and at any and all
adjournments thereof, on the matters listed on the reverse side
of this card.

The undersigned hereby acknowledges receipt of the Annual
Report to Stockholders for the Fiscal Year ended December 31,
1997, Proxy Statement and Notice of Annual Meeting dated August __,
1998.

PLEASE VOTE AND SIGN ON OTHER SIDE
AND RETURN PROMPTLY IN ENCLOSED ENVELOPE.

(Please sign exactly as your name appears on your stock
certificate. If stock is registered in more than one name, each
holder should sign. When signing as an attorney, administrator,
executor, guardian or trustee, please add your title as such. If
executed by a corporation or partnership, the Proxy should be
signed in full corporate or partnership name by a duly authorized
officer or partner as applicable.)

Has your address changed? Do you have any comments?

_____________________________ __________________________
_____________________________ __________________________
_____________________________ _________________________

<PAGE>

[X] PLEASE MARK YOUR VOTES USCI, INC.
AS IN THIS EXAMPLE

(1) Election of the following nominees for the Board of
Directors to serve until the Annual Meeting of Stockholders in
1999 and until each successor is duly elected and qualified.

FOR [ ] WITHHOLD [ ] Nominees: BRUCE A. HAHN
EDGAR PUTHUFF
JEROME S. BARON
SALVATORE T. DIMASCIO
STEPHEN PAZIAN

Instruction: To withhold authority to vote for any
individual nominee, check the "Withhold" box and strike a line
through the nominee's name in the list at right. Unless
authority to vote for all foregoing nominees is withheld, this
proxy will be deemed to confer authority to vote for every
nominee whose name is not struck.

(2) Proposal to increase the number of authorized shares of
Preferred Stock to 1,005,000 from 5,000.
FOR [ ] AGAINST [ ] ABSTAIN [ ]

(3) Proposal to ratify the $5.5 million private placement of
unsecured notes and warrants.
FOR [ ] AGAINST [ ] ABSTAIN [ ]

(4) Proposal to ratify the private placement of up to $15 million
6% Convertible Preferred Stock and warrants.
FOR [ ] AGAINST [ ] ABSTAIN [ ]

(5) Proposal to increase the number of shares issuable upon the exercise
of options granted under the Company's 1997 Stock Option by 1,000,000 to
1,750,000.
FOR [ ] AGAINST [ ] ABSTAIN [ ]

(6) Proposal to adopt the Company's 1998 Stock Purchase Plan
FOR [ ] AGAINST [ ] ABSTAIN [ ]

(7) Ratify the appointment of Arthur Andersen LLP as the
independent accountants of the Company.
FOR [ ] AGAINST [ ] ABSTAIN [ ]

(9) In their discretion, on any other matters which may properly
come before the meeting or any adjournment thereof.

Mark the box at right if comments or address change have been
noted on the reverse side of this card. [ ]

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED HEREIN BY THE STOCKHOLDER(S). IF NO DIRECTION IS MADE,
THIS PROXY WILL BE VOTED FOR ITEMS 1 THROUGH 9

Please be sure to sign and date this Proxy.
Date________________
Stockholder sign here_____________________________
Co-owner sign here________________________________