Exhibit 10.5


 


UNITED
STATES CELLULAR CORPORATION (the “Company”)


 


Compensation
Plan for Non-Employee Directors (the “Plan”)


 


As
Amended, Effective May 20, 2008


 


The purpose of the Plan
is to provide appropriate compensation to non-employee directors for their
service to the Company and to ensure that qualified persons serve as
non-employee members of the Board of Directors.


 


The Plan was approved
pursuant to the authority granted in Section 12 of Article V of the
Company’s By-Laws, which provides that the Board of Directors shall have
authority to establish reasonable compensation of directors, including
reimbursement of expenses incurred in attending meetings of the Board of
Directors.


 


Board Service


 


Each director of the
Company who is not an employee of the Company, Telephone and Data Systems, Inc.
(“TDS”), TDS Telecommunications Corporation, or any other subsidiary of TDS (“non-employee
director”) will receive:


 


1.               An annual director’s retainer fee of
$55,000 paid in cash.


 


2.               An annual award of $55,000 paid in the
form of the Company’s Common Shares, which shall be distributed in March on
or prior to March 15 of each year, beginning in March, 2009, for services
performed during the 12 month period that commences on March 1 of the
immediately preceding calendar year and ends on the last day of February of
the calendar year of payment.  The number
of shares shall be determined on the basis of the closing price of the Company’s
Common Shares, as reported in the New York Stock Exchange Composite Transaction
section of the Wall Street Journal for the last trading day in the month of February of
each year.  (A director who is not a
citizen of the United States may, at his or her election, receive such award in
the form of cash.)  Notwithstanding the
foregoing, the annual award of $55,000 to be distributed in March, 2009 shall
be distributed $45,000 in the form of Common Shares and $10,000 in the form of
cash.


 


3.               A director’s meeting fee of $1,750 for
each meeting attended and reimbursement of reasonable expenses incurred in
connection with attendance at meetings of the Board of Directors, paid in cash.


 


Audit Committee Service


 


Each non-employee
director who serves on the Audit Committee, other than the Chairperson, will
receive an annual committee retainer fee of $11,000, paid quarterly, a
committee meeting fee of $1,750 for each meeting attended and reimbursement of
reasonable expenses incurred in connection with attendance at meetings of the
Audit Committee.  The Audit Committee
Chairperson will receive an annual retainer fee of $22,000, paid quarterly, a
committee meeting fee of $1,750 for each meeting attended and reimbursement of
reasonable expenses incurred in connection with attendance at such meeting.


 


Stock Option Compensation
Committee Service


 


Each non-employee
director of the Company who serves on the Stock Option Compensation Committee,
other than the Stock Option Compensation Committee Chairperson, will receive an
annual committee retainer fee of $7,000, paid quarterly, a committee meeting
fee of $1,750 for each meeting attended and reimbursement of reasonable
expenses incurred in connection with attendance at each meeting of the
committee.  The Stock Option Compensation
Committee Chairperson will receive an annual retainer fee of $14,000, paid
quarterly, a committee meeting fee of $1,750 for each meeting attended and
reimbursement of reasonable expenses incurred in connection with attendance at
such meeting.


 


Miscellaneous


 


Under the Plan, annual
retainers will be paid in cash on a quarterly basis, as of the last day of each
calendar quarter, and will compensate the non-employee director for services
performed during such calendar quarter.


 

















 


Fees for meetings of the
board and all committee meetings will be paid in cash on a quarterly basis as
of the last day of each calendar quarter, and will compensate the non-employee
director for meetings attended during such calendar quarter.


 


Non-employee directors
shall timely submit for reimbursement of reasonable expenses incurred in
connection with meeting attendance, and the Company shall reimburse such
expenses within two weeks after submission. 
In no event shall such reimbursement occur following the last day of the
calendar year following the calendar year in which the expense was incurred.


 


Upon approval of this
amended Plan by shareholders of the Company, directors of the Company shall
have the authority without further shareholder approval to further amend this
Plan from time to time, including amendments to increase the amount of the
compensation payable in Common Shares from time to time, provided that the
total number of Common Shares issued under the Plan shall not exceed the amount
approved by shareholders of the Company.