June 30, 1998 Minutes

Board of Directors Meeting

A meeting of the Board of Directors of the Universal Service Administrative Company (USAC) was held via conference call on the above date. The meeting was called to order at 1:00 PM EDST by Lisa Rosenblum. Edward English, USAC Secretary and Treasurer called the roll.

1. Ms. Rosenblum welcomed the members of the Board. The purpose of the meeting was to determine if any further modification should be made to the Report and Plan of Reorganization (the Plan).
   

2. The floor was turned over to Mr. Jonathan Blake, representing the Rural Health Care Corporation (RHCC), who reported on the results of the RHCC meeting earlier in the day. The RHCC was fully supportive of the Plan if it would include the following provisions:
   

1. two additional rural health care members to be added to the USAC Board would be specified in the merger agreement;
   

2. the two-thirds override authority of the USAC Board would only apply to budget items, not programmatic items which would be controlled by the Rural Health Care Committee;
   

3. the CEO of USAC could hire and fire the division heads, but the division heads would control staff within their respective organizations, and
   

4. the Rural Health Care Committee would be expanded to seven members and be comprised of the four existing directors, two at-large USAC directors and the USAC CEO.
   

3. Ms. Ouye reported that the SLC Board had met earlier to discuss the RHCC issues and had taken no additional action. However, her sense of the SLC Board was that it would not go along with the RHCC recommendation.
   

4. The USAC Board discussed the issues, and on a motion duly made and seconded, the Board elected not to reconsider the resolution adopted on June 26, 1998.
   

5. The Board then discussed the composition of the Rural Health Care Committee and a recommendation was made to have seven members comprised of the following representatives: one rural health care, one industry, two at-large, 2 state, and the USAC CEO. On a motion duly made and seconded, the Committee's composition was unanimously approved as recommended.
   

6. Ms. Parrino discussed the logistics of filing the Plan with the FCC and indicated that an Executive Summary and press release would be forthcoming. It was decided that the RHCC would file in conjunction with USAC and SLC indicating agreement, with the exception of the four issues noted by Mr. Blake.
   

There being no further business to attend to, Ms. Rosenblum thanked all parties for the joint effort in the preparation of the Plan, and the meeting was adjourned at 1:36 PM.

____________________________________
Edward R. English
Secretary

___________
Date