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                                                                        Page 1

                               U.S. LONG DISTANCE CORP.


                         EXECUTIVE COMPENSATION DEFERRAL PLAN
                         (With Company Matching Contribution)

                                       RESTATED


                             EFFECTIVE DECEMBER 12, 1995

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                                                                        Page 2

                                  TABLE OF CONTENTS
                                                                          PAGE
                                                                          ----
ARTICLE 1     DEFINITIONS  . . . . . . . . . . . . . . . . . . . . . . . .  1

    1.1  "Beneficiary" or "Beneficiaries". . . . . . . . . . . . . . . . .  1
    1.2  "Board" . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1
    1.3  "Change of Control" . . . . . . . . . . . . . . . . . . . . . . .  1
    1.4  "Company" . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2
    1.5  "Company Matching Contribution" . . . . . . . . . . . . . . . . .  2
    1.6  "Deferred Compensation Accounts". . . . . . . . . . . . . . . . .  2
    1.7  "Disability". . . . . . . . . . . . . . . . . . . . . . . . . . .  2
    1.8  "Eligible Compensation" . . . . . . . . . . . . . . . . . . . . .  2
    1.9  "Eligible Compensation Deferral Contribution" . . . . . . . . . .  2
    1.10 "Interest Crediting Rate" . . . . . . . . . . . . . . . . . . . .  2
    1.11 "Participant" . . . . . . . . . . . . . . . . . . . . . . . . . .  2
    1.12 "Plan". . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  2
    1.13 "Plan Entry Date" . . . . . . . . . . . . . . . . . . . . . . . .  3
    1.14 "Plan Year" . . . . . . . . . . . . . . . . . . . . . . . . . . .  3
    1.15 "Retirement". . . . . . . . . . . . . . . . . . . . . . . . . . .  3
    1.16 "Termination for cause" . . . . . . . . . . . . . . . . . . . . .  3
    1.17 Interpretation. . . . . . . . . . . . . . . . . . . . . . . . . .  3

ARTICLE 2     ELIGIBILITY. . . . . . . . . . . . . . . . . . . . . . . . .  3

ARTICLE 3     ELIGIBLE COMPENSATION DEFERRAL ELECTION. . . . . . . . . . .  3

    3.1  Amount of Eligible Compensation Deferral. . . . . . . . . . . . .  3
    3.2  Vesting of Eligible Compensation Deferral . . . . . . . . . . . .  4

ARTICLE 4     COMPANY MATCHING CONTRIBUTIONS . . . . . . . . . . . . . . .  4

    4.1  Amount of Company Matching Contribution . . . . . . . . . . . . .  4
    4.2  Vesting of Company Matching Contributions . . . . . . . . . . . .  4

ARTICLE 5     DEFERRED COMPENSATION ACCOUNTS . . . . . . . . . . . . . . .  5

    5.1  Establishment of Deferred Compensation Accounts . . . . . . . . .  5

         (a)  Eligible Compensation Deferral Account . . . . . . . . . . .  5
         (b)  Company Matching Contribution Account. . . . . . . . . . . .  5

    5.2  Crediting of Interest . . . . . . . . . . . . . . . . . . . . . .  5

ARTICLE 6     BENEFIT OF PAYMENT . . . . . . . . . . . . . . . . . . . . .  5

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                                                                        Page 3

    6.1  Amount of Benefit . . . . . . . . . . . . . . . . . . . . . . . .  5
    6.2  Payment Events. . . . . . . . . . . . . . . . . . . . . . . . . .  6
    6.3  Time and Manner of Payment of Benefits. . . . . . . . . . . . . .  6
    6.4  Death After the Commencement of Installment Benefit Payments. . .  6
    6.5  Payment of Benefits From General Assets; Unsecured Creditor
         Status of Participants. . . . . . . . . . . . . . . . . . . . . .  7

ARTICLE 7     ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . .  7

    7.1  Administration by the Company . . . . . . . . . . . . . . . . . .  7

ARTICLE 8     AMENDMENT OR TERMINATION . . . . . . . . . . . . . . . . . .  8

    8.1  Amendment or Termination. . . . . . . . . . . . . . . . . . . . .  8
    8.2  Effect of Amendment or Termination. . . . . . . . . . . . . . . .  8

ARTICLE 9     GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . .  8

    9.1  No Guarantee of Benefits. . . . . . . . . . . . . . . . . . . . .  8
    9.2  No Enlargement of Employee Rights . . . . . . . . . . . . . . . .  8
    9.3  Spendthrift Provision . . . . . . . . . . . . . . . . . . . . . .  8
    9.4  Applicable Law. . . . . . . . . . . . . . . . . . . . . . . . . .  8
    9.5  Incapacity of Recipient . . . . . . . . . . . . . . . . . . . . .  9
    9.6  Corporate Successors. . . . . . . . . . . . . . . . . . . . . . .  9
    9.7  Unclaimed Benefits. . . . . . . . . . . . . . . . . . . . . . . .  9
    9.8  Limitations on Liability. . . . . . . . . . . . . . . . . . . . .  9

ARTICLE 10  CLAIMS FOR BENEFITS  . . . . . . . . . . . . . . . . . . . . .  9

    10.1 Claims Procedure. . . . . . . . . . . . . . . . . . . . . . . . .  9
    10.2 Review Procedure. . . . . . . . . . . . . . . . . . . . . . . . . 10

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                                                                        Page 4

                               U.S. LONG DISTANCE CORP.

                         EXECUTIVE COMPENSATION DEFERRAL PLAN
                         (With Company Matching Contribution)

                                       RESTATED
                                    PLAN DOCUMENT


    The U.S. LONG DISTANCE CORP. EXECUTIVE COMPENSATION DEFERRAL PLAN (the
"Plan"), originally effective January 1, 1994, is hereby amended effective the
12th day of December, 1995.  The Plan is established and maintained by U.S. LONG
DISTANCE CORP. (the "Company") solely for the purpose of permitting a select
group of management and/or highly compensated employees to defer all or a
portion of their Compensation and to provide for a partial Company Matching
Contribution.

    Accordingly, U.S. LONG DISTANCE CORP. hereby adopts the Plan pursuant to
the terms and provisions hereinafter set forth and designates the Company as
Plan Administrator of this Plan.

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                                                                        Page 5

                                      ARTICLE 1

                                     DEFINITIONS
                                           

    Whenever used herein, the following terms shall have the meanings as set
forth in this Article:

1.1 "Beneficiary" or "Beneficiaries" means the individual or individuals
    designated by a Participant on a Beneficiary Form filed with the Company to
    receive the amount of benefit specified in Section 6.1 in the event of the
    Participant's death prior to Retirement, Disability, or other lifetime
    termination of employment, or to receive the death benefit as provided in
    Section 6.4 in the event of the Participant's death while receiving
    installment payments after the occurrence of one of such events.  If a
    Participant has not designated any beneficiary, or if no designated
    beneficiary is living on the date of distribution, then such amounts shall
    be paid to the Participant's spouse, or if the Participant's spouse is not
    then living or if the Participant is unmarried or action for divorce or
    annulment has been filed at the time of death, then, unless the provisions
    of Section 9.8 apply, such amounts shall be paid to the Participant's
    estate.

1.2 "Board" means the Board of Directors of the Company, or any committee of
    the Board authorized to act in its behalf in connection with the Plan.

1.3 "Change of Control" shall mean change in at least 51% ownership interest in
    the Company by sale, merger or liquidation, dissolution or reorganization.

1.4 "Company" means U.S. LONG DISTANCE CORP., a Delaware corporation, or, to
    the extent provided in Section 9.7, any successor corporation or other
    entity resulting from a merger or consolidation into or with the Company or
    from a transfer or sale of substantially all of the assets of the Company.

1.5 "Company Matching Contribution" means the contribution made by the Company
    out of its own funds in behalf of a Plan Participant during any Plan Year
    pursuant to Article 4.

1.6 "Deferred Compensation Accounts" means the Accounts established in the name
    of a Plan Participant pursuant to Article 5.  One of such Accounts shall be
    designated as the "Eligible Compensation Deferral Account" and the other
    Account shall be designated as the "Company Matching Contribution Account."

1.7 "Disability" means that the Participant is unable to perform the usual and
    customary duties of his or her regular job and is unable to work elsewhere
    in the Company in a capacity for which the Participant is suited by
    education, training, or experience, for a period of six (6) months as a
    result of illness or injury.

1.8 "Eligible Compensation" means the base compensation payable to a
    Participant 

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                                                                        Page 6

    by the Company for individual performance.

1.9  "Eligible Compensation Deferral Contribution" means the contribution
     credited to a Participant's Eligible Compensation Deferral Account
     resulting from a deferral from Eligible Compensation under and in
     accordance with the terms of the Plan during any Plan Year.

1.10 "Interest Crediting Rate" means the interest rate declared by the Company
     which will be credited at least annually to a Participant's Deferred
     Compensation Accounts.  For the first Plan Year, the interest rate shall be
     declared by the Company at the inception of the Plan and shall apply until
     the end of that year.  Thereafter, the interest rate shall be declared by
     the Company by December 15th of each year for the following Plan Year.  If
     it is not declared by that time, the rate for the following year shall be
     the prime rate of interest declared by the Frost National Bank of
     San Antonio plus two percent (2%), determined as of December 15th.

1.11 "Participant" means an employee of the Company who qualifies to participate
     in the Plan under the eligibility requirements set forth in Article 2 and
     who elects to participate in the Plan by filing with the Company
     Participation Enrollment and Election Forms.

1.12 "Plan" means the Executive Compensation Deferral Plan provided for herein
     for selected management and/or highly compensated employees of the Company.
  
1.13 "Plan Entry Date" shall mean the effective date of the Plan, the date an
     Employee first becomes an Eligible Employee (as defined in Article 2), and
     each January 1st thereafter.

1.14 "Plan Year" means each 12-month calendar year.

1.15 "Retirement" means either (i) a Participant's actual early, normal or late
     retirement from employment with the Company, whether under the terms of the
     Company's qualified retirement plan or otherwise, or (ii) the Participant's
     attainment of age 65 if later than actual retirement, as elected by the
     Participant on the Payout Election Form filed at the time of the
     Participant's initial election to defer Eligible Compensation under the
     Plan.

1.16 "Termination for cause" shall mean an employee's termination of employment
     by the Board of Directors for fraud, embezzlement, or such other egregious
     and serious act against the Company that warrants immediate termination.

1.17 Interpretation.  Words in the masculine gender shall include the feminine,
     and the singular shall include the plural, and vice versa, unless otherwise
     required by context.  Any headings used herein are for ease of reference
     only and are not to be construed as to alter the meaning of the substantive
     provisions of the Plan.

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                                                                        Page 7

                                      ARTICLE 2

                                     ELIGIBILITY

    Selected employees occupying management positions with the Company or its
subsidiaries who are determined by the Board from time to time to be eligible to
participate in the Plan ("Eligible Employees").  All Eligible Employees may
thereafter participate in the Plan beginning on the effective date of the Plan
or any Plan Entry Date thereafter.

                                      ARTICLE 3
                                           
                       ELIGIBLE COMPENSATION DEFERRAL ELECTION
                                           
3.1 Amount of Eligible Compensation Deferral.  An employee who is eligible to
    participate in the Plan may elect effective on a Plan Entry Date to defer
    all or a portion of his or her Eligible Compensation for a Plan Year by
    filing with the Company an Annual Deferral Election Form prior to the Plan
    Year to which such election relates; provided, however, that (i) for
    employees who are eligible to participate in the Plan upon adoption of the
    Plan, the election for the first Plan Year may be made with the 30-day
    period immediately after adoption of the Plan, and (ii) for employees who
    become eligible to participate in the Plan thereafter, the election for the
    Plan Year during which they first become eligible may be made within the
    first pay period immediately after becoming eligible.  Deferrals from
    Eligible Compensation shall be made in equal monthly amounts of up to 100%
    of a Participant's Eligible Compensation.

3.2 Vesting of Eligible Compensation Deferral.  An Eligible Compensation
    Deferral is 100% vested, unless the employee is terminated for cause, in
    which case the Eligible Compensation shall be forfeited.

                                      ARTICLE 4

                            COMPANY MATCHING CONTRIBUTIONS
                                           
4.1 Amount of Company Matching Contribution.  In addition to a Participant's
    deferral from Eligible Compensation, the Company intends, each Plan Year,
    to contribute out of its own funds, on behalf of each Participant, an
    amount equal to the lesser of (a) 100% of the amount of such Participant's
    deferral from Eligible Compensation for such Plan Year or (b) an amount
    together with the Eligible Compensation Deferral which actuarially
    determined would yield a 10-year annuity equal to 50% of the Participant's
    compensation payable at age 65.  Effective for Plan Years beginning on or
    after January 1, 1996, the amount described in (b) shall in no event be
    less than $3,000.  Further, the interest rate used for purposes of
    determining the amount required to provide the annuity 

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                                                                        Page 8

    described in (b) above shall be the Interest Crediting Rate declared by 
    the Company for the same Plan Year pursuant to Section 5.2.  
    Notwithstanding anything contained in this paragraph, the Company, in its 
    sole discretion, reserves the right at any time for any Plan Year, either 
    (i) not to provide such Company Matching Contribution altogether, or (ii) 
    to make a Company Matching Contribution of a different amount, in either 
    case by giving written notice to each affected Participant by December 
    15th of the prior Plan Year.  Any such skipped or reduced Company 
    Matching Contribution shall not be required to be made up in future Plan 
    Years.

4.2 Vesting of Company Matching Contributions.  The portion of the Company
    Matching Contribution Account established for a Participant pursuant to
    Article 5 to which the Participant or the Participant's Beneficiary or
    Beneficiaries shall be entitled upon the occurrence of one of the payment
    events specified in Section 6.2 shall be based upon the number of full
    years of employment with the Company completed by the Participant as of the
    last day of the plan year prior to the date payment is due under this Plan. 
    Such vested portion shall be determined in accordance with the following
    schedule:

    YEARS OF SERVICE                          VESTED PORTION
    ----------------                          --------------
     Less than 1 year                              0.00%
     More than 1 and less than 2                  33.33%
     More than 2 and less than 3                  66.66%
     3 years or more                             100.00%
     Change of Control of Company                100.00%
     Termination for Cause                         0.00%

                                      ARTICLE 5

                            DEFERRED COMPENSATION ACCOUNTS
                                           
5.1 Establishment of Deferred Compensation Accounts.  The Company shall
    establish and maintain in the name of each Plan Participant two separate
    accounts (the "Participant's Accounts") designated, respectively, as the
    "Eligible Compensation Deferral Account" and the "Company Matching
    Contribution Account."  Such Accounts shall be segregated from other
    accounts on the books and records of the Company and shall together be
    carried as a contingent liability of the Company to the Participant.

5.2 Eligible Compensation Deferral Account.  The Company shall credit to the
    Eligible Compensation Deferral Account (the "Deferral Account") the amount
    of each deferral from Eligible Compensation which the Participant elects to
    make on a timely filed Annual Deferral Election Form.  Such amount shall be
    credited to the Deferral Account as of the day such Eligible Compensation
    would 

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                                                                       Page 9

    otherwise be payable to the Participant.

5.3 Company Matching Contribution Account.  The Company shall credit to the
    Company Matching Contribution Account (the "Matching Account") the amount
    of each Company Matching Contribution.  Such amount shall be credited to
    the Matching Account on the same day as the Participant's deferral from
    Eligible Compensation to which it relates is credited to the Participant's
    Deferral Account.

5.4 Crediting of Interest.  From time to time, the Company shall credit each of
    the Participant's Accounts with interest at the Interest Crediting Rate
    declared by the Company for that year.  Interest on amounts in an Account
    for less than a full calendar year shall be appropriately pro-rated based
    upon the number of days within the calendar year such amounts have been in
    such Account.  Interest shall continue to be credited to a Participant's
    Accounts in the foregoing manner for only as long as the Participant is an
    employee with the Company and not disabled or deceased.  Thereafter, the
    Company shall credit the Participant's Deferral Account and the vested
    Matching Account with the rate of interest earned on federally insured
    passbook savings accounts at Frost National Bank of San Antonio, Texas.

                                      ARTICLE 6

                                  PAYMENT OF BENEFIT

6.1 Amount of Benefit. The benefit payable to a Participant or a Participant's 
    Beneficiary or Beneficiaries shall be equal to 100% of the value of such 
    Participant's Deferral Account, unless terminated for cause, plus the 
    vested percentage of the value of such Participant's Matching Account, 
    "value" in each case to be determined in accordance with Article 5 as of 
    the date of the applicable payment event specified in Section 6.2, 
    except, in the event of a Participant's death, the Participant's 
    Beneficiary or Beneficiaries shall be entitled to a minimum benefit in an 
    amount equal to twelve (12) times the monthly base compensation which the 
    Participant received as of the month prior to the Participant's death.

6.2 Payment Events.  Benefits shall become due and payable to a Participant or
    a Participant's Beneficiary or Beneficiaries upon the occurrence of the
    first to occur of the following events:

    (a)  Retirement of the Participant as defined in Section 1.15;

    (b)  Disability of the Participant as defined in Section 1.6, except that
         the Company may, in its sole discretion, commence benefit payments
         prior to the date specified in Section 1.6 if the Participant is
         unable to work for the Company as a result of illness or injury;

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                                                                        Page 10

    (c)  The later of any termination of employment or termination of the
         written employment contract of the Participant;

    (d)  Death of the Participant prior to the occurrence of any of the other
         events specified in this Section 6.2.

6.3 Time and Manner of Payment of Benefits.  Benefits payable upon the
    occurrence of an event specified in Section 6.2 shall be paid, or
    installment payments shall commence, on the first day of the month next
    following the occurrence of the event, or as soon thereafter as may
    reasonably be practicable.  Benefits payable upon the occurrence of an
    event specified in paragraph (a), (b), (c) or (d) of Section 6.2 shall be
    paid in a lump sum, except that elections of payment in installments with
    interest over a period of five (5) or ten (10) years signed prior to
    December 12, 1995 and not subsequently revoked shall be honored.  The
    Retirement of a Participant under Section 1.15 may be changed at any time
    by means of execution and filing of a new Payout Election Form, but any new
    Payout Election Form shall not become effective until the date that is two
    calendar years following the date of the new election.  In addition, a
    Participant who has elected payment of benefits in installment form prior
    to December 12, 1995 may subsequently elect payment in lump sum form, but
    such election shall not become effective until two calendar years following
    the date of the election.

6.4 Death After the Commencement of Installment Benefit Payments.  If a
    Participant dies after the commencement of installment benefit payments but
    before distribution of the full amount specified in Section 6.1, either
    (i) such payments shall continue to be paid to the Participant's
    Beneficiary or Beneficiaries, or (ii) the balance due shall be paid to such
    Beneficiary or Beneficiaries in a lump sum, as elected by the Participant
    on the Payout Election Form filed with the Company.

6.5 Payment of Benefits From General Assets; Unsecured Creditor Status of
    Participants.  All benefits payable under the Plan to or in behalf of any
    Participant shall be paid from the general assets of the Company.  The
    Company shall set aside funds with which to discharge its obligations
    hereunder, and may if it chooses to do so by the purchase of Corporate
    Owned Life Insurance (COLI) policies on the lives of the Participants or
    otherwise.  Any and all funds which may be so set aside shall remain
    subject to the claims of the present and future general creditors of the
    Company in the event of insolvency or bankruptcy, and any recipient of
    benefits hereunder shall not have any security or other interest in such
    funds.  Neither any Participant, his or her Beneficiary or Beneficiaries,
    nor any other person shall, under any circumstances, have an interest
    whatsoever in any particular property or assets of the Company by virtue of
    the Plan, and the rights of the Participant and his or her Beneficiary or
    Beneficiaries under the Plan shall be no greater than the rights of a
    general unsecured creditor of the Company.  The right of a Participant or
    his or her Beneficiary or Beneficiaries 

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                                                                        Page 11

    to receive a benefit payment hereunder shall be an unsecured claim against 
    the general assets of the Company, and neither the Participant nor his or 
    her Beneficiary or Beneficiaries shall have any rights, in, to or against 
    any specific assets of the Company.  All amounts credited to the Deferred 
    Compensation Accounts of a Participant shall constitute general assets of 
    the Company and, subject to any trust agreement established to hold assets 
    pursuant to this Plan, may be disposed of by the Company at such time and 
    for such purposes as it may deem appropriate in the event of bankruptcy or 
    insolvency.

                                      ARTICLE 7

                                    ADMINISTRATION
                                           
7.1  Administration by the Company.  The Company shall be entitled to rely
     conclusively upon all tables, valuations, certificates, opinions and 
     reports furnished by any actuary, accountant, controller, counsel, or 
     other person employed or engaged by the Company with respect to the 
     Plan.  The Company shall have full power and discretion to administer 
     the Plan in all of its details, and its decision shall be binding.  For 
     this purpose, the Company's powers shall include, but shall not be 
     limited to, the following authority, in addition to all other powers 
     provided hereunder:

    (a)  To make and enforce such rules and regulations as it deems necessary
         or proper for the efficient administration of the Plan;

    (b)  To interpret the Plan, its interpretation thereof in good faith to be
         final and conclusive on all persons claiming benefits under the Plan;

    (c)  To decide all questions concerning the Plan and the eligibility of any
         person to participate in the Plan;

    (d)  To appoint such agents, counsel, accountants, consultants, and other
         persons as may be required to assist in administering the Plan; and

    (e)  To allocate and delegate its responsibilities under the plan and to
         designate other persons or an administrative committee to carry out
         any of its responsibilities under the Plan, any such allocation,
         delegation or designation to be in writing.

                                      ARTICLE 8

                               AMENDMENT OR TERMINATION

8.1 Amendment or Termination.  The Company intends the Plan to be permanent,
    but reserves the right to amend or terminate the Plan when, in the sole
    opinion of the Company, such amendment or termination is advisable.  Any
    such 

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                                                                       Page 12

    amendment or termination shall be made pursuant to a resolution of the
    Board and shall be effective as of the date specified in such resolution.

8.2 Effect of Amendment or Termination.  No amendment or termination of the
    Plan shall directly or indirectly reduce the value of any Deferred
    Compensation Account held hereunder as of the effective date of such
    amendment or termination.

                                    ARTICLE 9

                                 GENERAL PROVISIONS
                                           
9.1 No Guarantee of Benefits.  Nothing contained in the Plan shall constitute a
    guarantee by the Company or by any other person or entity that the assets
    of the Company will be sufficient to pay any benefits hereunder.

9.2 No Enlargement of Employee Rights.  No Participant shall have any right to
    receive a benefit payment under the Plan except in accordance with the
    terms of the Plan.  Establishment of the Plan shall not be construed to
    give any Participant the right to be retained in the service of the
    Company.

9.3 Spendthrift Provision.  No interest of any person or entity in, or right to
    receive a benefit payment under, the Plan shall be subject in any manner to
    sale, transfer, assignment, pledge, attachment, garnishment or other
    alienation or encumbrance of any kind; nor may any such interest or right
    to receive a benefit payment be taken, either voluntarily or involuntarily,
    for the satisfaction of the debts of, or other obligations or claims
    against, such person or entity, including claims of alimony, support or
    separate maintenance, or claims in bankruptcy proceedings.

9.4 Applicable Law.  The Plan shall be construed and administered under the
    laws of the State of Texas.

9.5 Incapacity of Recipient.  If any person entitled to a benefit payment under
    the Plan is deemed by the Company to be incapable of personally receiving,
    and giving a valid receipt for, such payment, then, unless and until claim
    therefor shall have been made by a duly appointed guardian, conservator or
    other legal representative of such person, the Company may provide for such
    payment or any part thereof to be made to any other person or institution
    then contributing toward or providing for the care and maintenance of such
    person.  Any such payment shall be a payment for the account of such person
    and shall constitute a complete discharge of any liability of the Company
    and the Plan therefor.

9.6 Corporate Successors.  The Plan shall not be automatically terminated by a
    transfer or sale of assets of the Company or by the merger or consolidation
    of the Company into or with any other corporation or other entity, but the
    Plan shall

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                                                                       Page 13

    be continued after such sale, merger or consolidation only if and to the 
    extent that the transferee, purchaser or successor entity agrees to 
    continue the Plan.  In the event that the Plan is not continued by the 
    transferee, purchaser or successor entity, then the Plan shall terminate 
    subject to the provisions of Section 8.2.

9.7 Unclaimed Benefits.  Each Participant shall keep the Company informed of
    his or her current address and the current address of his or her
    Beneficiary or Beneficiaries.  The Company shall not be obligated to search
    for the whereabouts of any person.  If the location of a Participant is not
    made known to the Company within three (3) years after the date on which
    payment of the Participant's benefit may first be made, payment may be made
    as though the Participant had died at the end of the three-year period,
    provided that proof of death satisfactory to the Plan Administrator is
    provided.  If, within one additional year after such three-year period has
    elapsed, or, within three years after the actual death of a Participant,
    the Company is unable to locate any Beneficiary or Beneficiaries of the
    Participant, and is further unable to locate a spouse, dependent or
    descendant of the Participant, then the Company shall have no further
    obligation to pay any benefit hereunder to or in behalf of such Participant
    or Beneficiary, and such benefits shall be irrevocably forfeited.

9.8 Limitations on Liability.  Notwithstanding any of the preceding provisions
    of the Plan, neither the Company nor any Individual acting as employee or
    agent of the Company shall be liable to any Participant, former
    Participant, Beneficiary, or other person for any claim, loss, liability or
    expense incurred in connection with the Plan.

                                   ARTICLE 10

                               CLAIMS FOR BENEFITS

10.1 Claims Procedure.  The Plan Administrator shall make all determinations as
     to the right of a Participant or Beneficiary to a benefit under the Plan. 
     If any person does not receive the benefit to which he or she believes he
     or she is entitled under this Plan, said person may file a claim for 
     benefits in writing which shall be signed by the Participant, Beneficiary 
     or legal representative of a Participant or Beneficiary.  Claims shall be
     granted or denied within 30 days after receipt unless additional time is 
     required because of special circumstances.  If additional time is required,
     the claimant will be notified in writing before the expiration of 30 days
     from the receipt of the claim.  In no event shall the time for reaching a 
     decision with respect to a claim be extended beyond 180 days after receipt 
     of the claim.

     In the event that the Plan Administrator denies a claim for benefits, the
     claimant will be notified in writing.  Such notice shall set forth the
     specific reasons for the denial, the specific provisions of this Plan on
     which the denial is based, a 

<PAGE>

                                                                       Page 14

     description of any additional materials or information necessary to 
     perfect the claim along with an explanation of why such material or 
     information is necessary, and an explanation of the claim review 
     procedure.

     If no action is taken by the Plan Administrator on a claim within 30 days
     after its receipt, or, if the period for considering the claim has been
     extended, then if no action is taken within 180 days after receipt of the
     claims, the claim shall be deemed to be denied for purposes of the
     following review procedure.

10.2 Review Procedure.  If a claim is denied in whole or in part, the claimant
     may request the Board to review the decision with the Plan Administrator,
     neither body to include the claimant.  This request must be made in writing
     within 30 days after the claim has been denied or is deemed to be denied
     under Section 10.1 and must set forth all of the grounds upon which the
     request is based, any facts in support of the request, and any issues or
     comments which the claimant considers relevant to the review.  In preparing
     a request for review, the claimant will be entitled to review any documents
     which are pertinent to his or her claim at the office of the Company during
     regular business hours.

     The Board of Directors shall act upon each request for review as soon as
     possible but not later than 60 days after the request for review is
     received.

     The Board of Directors shall make an independent determination concerning
     the claim for benefits under this Plan and shall give written notice of its
     decision to the claimant.  The decision of the Board of Directors on any
     claim review shall be final.

     If the Board of Directors fails to deliver a decision within 60 days after
     receipt of the request for review, the claim shall be deemed denied on
     review.

     IN WITNESS WHEREOF, U.S. LONG DISTANCE CORP. has caused this instrument to
be executed by its duly authorized officer this 19th day of December, 1995,
effective as of the 12th day of December, 1995.

ATTEST:                               U.S. LONG DISTANCE CORP.


/s/ JENNIFER B. HARVEY                 By:  /s/ LARRY M. JAMES            
-------------------------------            -----------------------------
Assistant Secretary                    Name:     Larry M. James
                             Title:    President