-------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM 11-K
--------------
/x/ Annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934 (No Fee Required)
For the Fiscal Year Ended December 31, 1997
OR
/ / Transition report pursuant to Section 15(d) of the Securities Exchange
Act of 1934 (No Fee Required)
For the transition period from to
Commission file number 000-20913
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
Teleport Communications Group Inc.
Retirement Savings Plan
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
Teleport Communications Group Inc.
437 Ridge Road, Executive Building 3
Dayton, NJ 08810
------------------------------------------------------------------------
<PAGE>
TELEPORT COMMUNICATIONS GROUP INC.
RETIREMENT SAVINGS PLAN
TABLE OF CONTENTS
Page
INDEPENDENT AUDITORS' REPORT
FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED
DECEMBER 31, 1997 AND 1996:
Statements of Net Assets Available for Benefits 2
Statements of Changes in Net Assets Available for Benefits 3
Notes to Financial Statements 4 - 12
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 1997 AND
FOR THE YEAR THEN ENDED:
Item 27(a) - Schedule of Assets Held for Investment 13
Item 27(d) - Schedule of Reportable Transactions 14
<PAGE>
INDEPENDENT AUDITORS' REPORT
Teleport Communications Group Inc.
Retirement Savings Plan
We have audited the accompanying statements of net assets available for benefits
of the Teleport Communications Group Inc. Retirement Savings Plan (the "Plan" )
as of December 31, 1997 and 1996 and the related statements of changes in net
assets available for benefits for the years then ended. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1997 and 1996, and the changes in net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
Our audits were conducted for the purposes of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of Assets Held
for Investment and Reportable Transactions are presented for the purpose of
additional analysis and are not a required part of the basic financial
statements, but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. These schedules are the responsibility
of the Plan's management. Such schedules are subjected to the auditing
procedures applied in our audit of the basic financial statements and, in our
opinion, are fairly stated in all material respects when considered in relation
to the basic financial statements taken as a whole.
June 23, 1998
<PAGE>
TELEPORT COMMUNICATIONS GROUP INC.
RETIREMENT SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1997 AND 1996
- --------------------------------------------------------------------------------
1997 1996
---- ----
INVESTMENTS - At fair value:
Money market funds $ 3,943,470 $ 3,401,032
Common stock 7,823,970 2,023,863
Value of interest in registered
investment companies 32,853,436 21,240,429
Loans to participants 1,407,871 943,882
----------- -----------
Total investments 46,028,747 27,609,206
----------- -----------
RECEIVABLES:
Employer contributions 629,430 435,767
Participant contributions 433,272 282,617
Participant loans due 37,951 34,076
----------- -----------
Total receivables 1,100,653 752,460
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $47,129,400 $28,361,666
=========== ===========
See notes to financial statements.
2
<PAGE>
TELEPORT COMMUNICATIONS GROUP INC.
RETIREMENT SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 1997 AND 1996
- -------------------------------------------------------------------------------
1997 1996
---- ----
EARNINGS ON INVESTMENTS:
Interest and dividends $ 215,831 $ 148,530
Net realized and unrealized appreciation
(depreciation) on common stock 3,377,386 400,980
Net gain from registered investment
companies 5,234,296 3,572,437
------------ ------------
Total earnings on investments 8,827,513 4,121,947
------------ ------------
CONTRIBUTIONS:
Employer 3,811,671 2,443,876
Participant 6,151,839 3,980,473
Rollovers 1,348,174 2,704,198
Transfer in from the Eastern TeleLogic
Corporation Retirement Savings Plan 1,011,914 -
------------ ------------
Total contributions 12,323,598 9,128,547
------------ ------------
DISTRIBUTIONS TO PARTICIPANTS (2,383,377) (907,192)
------------ ------------
NET INCREASE IN NET ASSETS
AVAILABLE FOR BENEFITS 18,767,734 12,343,302
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 28,361,666 16,018,364
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $ 47,129,400 $ 28,361,666
============ ============
See notes to financial statements.
3
<PAGE>
TELEPORT COMMUNICATIONS GROUP INC.
RETIREMENT SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1997 AND 1996
- -------------------------------------------------------------------------------
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The more significant accounting and reporting policies followed in the
preparation of the financial statements of the Teleport Communications
Group Inc. Retirement Savings Plan (the "Plan" ) are:
a. Investment Valuation - Investments in securities listed on national
securities exchanges are valued at the closing composite price
published for the last business day of the year. Other investments are
stated at fair value as determined by the trustee.
b. Investment Transactions and Investment Income - Investment
transactions are accounted for on the trade date of purchases or
sales. Realized and unrealized gains and losses are determined based
on the fair market value of assets at the beginning of the Plan year.
Dividend income earned is accounted for on the ex-dividend date.
Interest income is recorded on the accrual basis as earned.
Total income of each fund is allocated quarterly to participants'
accounts within the fund based on the participants' relative beginning
balances adjusted for withdrawals and contributions.
c. The Internal Revenue Service has determined and informed the Company
by letter dated April 26, 1996 that the Plan and related trust are
designed in accordance with applicable sections of the Internal
Revenue Code (the Code). The Plan Administrator believes that the Plan
is currently being operated in compliance with the applicable
requirements of the Code. Therefore, no provision for income taxes has
been included in the Plan's financial statements.
d. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reporting period.
Actual results could differ from those estimates.
2. PLAN DESCRIPTION
The following brief description of the Plan is provided for general
information purposes only. Participants should refer to the Plan agreement
for more complete information.
a. General - The Plan is a defined contribution plan established
effective January 1, 1992 to provide benefits to qualified employees
of Teleport Communications Group Inc. ("TCG") and certain affiliates
(referred to herein collectively as the "Company") which, at December
31, 1997, is owned 22.37 percent by Cox Teleport, Inc. ("Cox"), a
4
<PAGE>
wholly-owned subsidiary of Cox Communications, Inc., 28.49 percent by
TCI Teleport, Inc. ("TCI"), a wholly-owned subsidiary of
Tele-Communications, Inc., 14.66 percent by Comcast Teleport, Inc.
("Comcast"), a wholly-owned subsidiary of Comcast Corporation and
34.48 percent by public shareholders. The Plan is subject to the
provisions of the Employee Retirement Income Security Act of 1974
("ERISA").
During 1992, Merrill Lynch Group, Inc., which is a wholly-owned
subsidiary of Merrill Lynch & Co., Inc., ("ML & Co.") sold its
ownership interest in the Company to Cox and TCI. The accounts of
employees of the Company who were participants under various Merrill
Lynch & Co., employee benefit plans (the "ML & Co. Plans") were
transferred into the Plan.
Effective March 14, 1997, the Eastern TeleLogic Corporation Retirement
Savings Plan, a defined contribution plan established for the
employees of TCG Delaware Valley, merged into the TCG Retirement
Savings Plan. The participants of the Eastern TeleLogic Corporation
Retirement Savings Plan transferred assets of
$1,011,914 to the Plan.
b. Administration of the Plan - The Administrative Committee is appointed
by the Board of Directors (the "Board") of the Company and serves as a
fiduciary of the Plan. The Administrative Committee has general
responsibility for the administration and interpretation of the Plan.
c. Participation - Certain employees of the Company who had been
participating under various ML & Co. Plans became participants under
this Plan on January 1, 1992. For purposes of electing 401(k)
contributions, employees of the Company who had completed one year of
service as of January 1, 1992 became participants as of that date.
Effective December 31, 1997, an employee shall become a participant
for purposes of electing 401(k) savings contributions on the first day
of any calendar quarter coincident with or next following the date of
hire.
For purposes of sharing in retirement contributions made by the
Company, employees who had completed one year of service and attained
age 21 as of January 1, 1992 became participants as of that date. Each
other employee shall become a participant on the first day of any
calendar quarter coincident with or next following the date on which
he has completed one year of service and attained age 21.
d. Contributions - The Plan consists of the following two components: (1)
a 401(k) savings component under which a participant may elect to
defer a portion of his eligible compensation for contribution to the
Plan and the Company will match a portion of the participant's
contributions, and (2) a retirement savings component under which the
Company contributes a specified percentage of a participant's
compensation based on the participant's years of service.
Under the 401(k) component, a participant may elect to contribute from
1 to 15 percent of his compensation to the Plan on a before-tax basis.
A participant shall receive a Company matching contribution equal to
50 percent of the first six percent of his compensation contributed up
to a maximum of $1,500 per year.
5
<PAGE>
Under the retirement savings component, the Company shall contribute
quarterly an amount equal to a percentage of the participant's
eligible compensation based on years of service as follows:
Percentage of Eligible Compensation
Years of Service Up to Compensation Over Compensation
on Each January 4, Threshold Threshold
less than five 2.0% 1.0%
at least 5 but less than 10 3.0% 1.5%
at least 10 but less than 15 4.0% 2.0%
at least 15 but less than 20 5.0% 2.5%
at least 20 but less than 25 6.0% 3.0%
at least 25 but less than 30 7.0% 3.5%
30 or more 8.0% 4.0%
The compensation threshold is equal to three-quarters of the annual
compensation limit prescribed by Code section 401(a)(17) in effect for
the Plan year. The compensation threshold was $120,000 for the year
ended December 31, 1997 and $150,000 for the year ended December 31,
1996. Employee contributions are not required in order to receive
Company retirement contributions.
e. Investment Designation - Each participant shall have the right to
direct the investment of his accounts in increments of at least five
percent among the investment funds made available by the Company. Each
participant shall have the opportunity to change the investment
direction or reallocate existing account balances as needed by
utilizing the voice response system established with Merrill Lynch.
The Plan includes the following funds in which participants can elect
to invest their Plan assets:
Merrill Lynch Retirement Reserves Money Fund - seeks to provide
current income by investing in a diversified portfolio of
short-term money market securities such as U.S. government
securities, bank certificates of deposit and commercial paper.
Merrill Lynch Corporate Bond Fund - seeks to provide income and,
secondarily, growth by investing in a portfolio of high quality
corporate bonds.
Merrill Lynch Capital Fund - seeks to achieve the highest total
return (growth and income) by investing in stocks, bonds and
convertible securities.
Merrill Lynch Basic Value Fund - seeks to provide growth by
investing primarily in stocks that the fund manager believes are
selling below book value or at an historically low price/earnings
ratio.
Merrill Lynch Growth Fund for Investment and Retirement - seeks
to provide growth and, secondarily, income by investing in
companies that the fund manager believes offer attractive growth
prospects at reasonable value.
6
<PAGE>
TCG Stock Fund - Effective November 1, 1996, the Plan offered the
Company's Class A Common Stock as an investment option. The Plan
purchases shares on the open market. As of December 31, 1997 and
1996, 113,553 shares and 36,168 shares, with a total market value
of $6.2 million and $1.1 million, respectively, had been purchased
under the Plan.
The Plan also includes a Merrill Lynch Common Stock Fund which
consists of participants' shares of Merrill Lynch common stock
acquired under the ML&Co. Plans and transferred into the Plan. No
contributions to the Merrill Lynch Common Stock Fund are allowed under
the Plan.
f. Loans - Effective January 1, 1993, a participant may apply for a loan
in an aggregate amount equal to, or less than, the lesser of: (1)
$50,000 less the highest outstanding loan balance during the preceding
12 months or (2) 50 percent of the vested value of his 401(k) savings
and Company matching accounts. The minimum loan permitted is $1,000.
Repayment of a loan must be made over a period not to exceed five
years (10 years on loans for a primary residence).
g. Withdrawals - A participant can make limited withdrawals from the Plan
as described below:
Five-Year Participant Withdrawals - A participant may withdraw up
to 100 percent of his Company matching account if he has not yet
reached age 59 1/2 and has participated in the Plan for at least
five years, including participation in the ML & Co. Plans.
Long-Term Disability Withdrawals - During a period of disability,
a participant may withdraw up to 100 percent of the value of his
401(k) savings account, and if fully vested, up to 100 percent of
his Company matching account.
Age 59 1/2 Withdrawals - Upon reaching age 59 1/2, a participant
may withdraw up to 100 percent of the value of his 401(k) savings
account, and if fully vested, up to 100 percent of his Company
matching account.
Hardship Withdrawals - A participant may request a hardship
withdrawal from his 401(k) savings account, and if fully vested,
from his Company matching account. The request cannot exceed the
amount required to fulfill the need caused by the financial
hardship. Hardship withdrawals may be requested for tuition and
related expenses, unreimbursed medical expenses exceeding $500
annually, costs directly related to the purchase of a principal
residence (excluding mortgage payments) and costs to prevent
eviction from, or foreclosure on, a principal residence. Before
receiving a hardship withdrawal, a participant must have taken the
maximum loan amount available under the Plan.
PAYSOP Shares Withdrawals - A participant may elect withdrawals
from his PAYSOP account, in cash or shares, after the beginning of
the month following the 84th month from the date the shares were
initially allocated to his account under the ML&Co. Employee Stock
Ownership Plan.
7
<PAGE>
h. Distributions - Upon retirement or termination of service, the
participant is entitled to a distribution of the vested portion of his
account balance. If the participant's account balance is $3,500 or
less, the participant shall receive a lump sum distribution as soon as
practicable after retirement or termination of service. If the value
of a participant's account exceeds $3,500, the participant can defer
receipt of his account balances until he reaches age 65. All benefits
shall be paid in the form of a lump sum distribution in cash,
except that a participant may request that distributions from the
Merrill Lynch Common Stock Fund be paid in whole shares of stock.
A participant must begin receiving distributions of his benefits no
later than the first day of April following the calendar year in which
he attains age 70 1/2, even if he is still employed by the Company.
Upon the death of a participant, a lump sum distribution equal to the
value of the vested portion of the participant's account shall be made
to his beneficiary as soon as practicable after the participant's
death.
i. Vesting - A participant is always 100 percent vested in his amounts
transferred from the ML & Co. Plans, employee contributions and
rollover amounts from other plans. Participants become fully vested in
Company retirement contributions upon the earlier of completion of
five years of service, disability, death or attainment of age 65.
Participants become vested in Company matching contributions as
follows:
Years of Service Vesting Percentage
---------------- ------------------
Less than one 0%
One, but less than two 20%
Two, but less than three 40%
Three, but less than four 60%
Four, but less than five 80%
Five or more 100%
For purposes of determining a participant's vesting percentage,
service is counted from the later of the date the participant began
working with the Company or any past or future owners and October 1,
1987.
j. Expenses - Expenses of administering the Plan may be paid out of Plan
assets if the Company does not pay such expenses directly.
k. Forfeitures - Forfeitures shall be applied to reduce Company
contributions.
l. Amendment or Discontinuance of the Plan - The Company will terminate
the Plan immediately preceding the consummation of the Merger with
AT&T Corp., a New York Corporation ("AT&T") (see Subsequent Event
footnote). At that time TCG employees will have the option to roll
over into the AT&T Long Term Savings Plan or an IRA, or take a
distribution that will be subject to an early withdrawal penalty and
taxes.
8
<PAGE>
3. INFORMATION CERTIFIED BY THE TRUSTEE
The following information was prepared by Merrill Lynch Trust Company, as
trustee, and furnished to the plan administrator. The plan administrator
has obtained certification from the trustee that such information as of
December 31, 1997 and 1996 is complete and accurate.
1997 1996
---- ----
Investments at fair value as determined
by quoted market price:
Corporate Bond Fund $ 1,559,995 $ 1,261,602
Capital Fund 5,278,239 3,450,301
Basic Value Fund 8,745,913 5,215,715
Growth Fund for Investment and Retirement 17,269,289 11,312,811
Merrill Lynch & Co. Common Stock Fund 1,592,759 920,192
TCG Stock Fund 6,231,211 1,103,671
Investments at estimated fair value as
determined by Merrill Lynch Trust
Company:
Retirement Reserves Money Fund 3,943,470 3,371,711
CMA Money Fund - 29,321
Loan Fund 1,407,871 943,882
----------- -----------
Total Plan investments $46,028,747 $27,609,206
=========== ===========
In addition, interest, dividends, net realized and unrealized appreciation
or depreciation, and net investment gain from registered investment
companies included in the caption "Earnings on Investments" have been
derived from statements certified by the Trustee for the years ended
December 31, 1997 and 1996. The "Earnings on Investments" for the years
ended December 31, 1997 and 1996 are comprised of the following:
1997 1996
Interest and Dividends:
Merrill Lynch & Co. Common Stock Fund $ 16,589 $ 13,500
Retirement Reserves Money Fund 187,611 133,865
Loan Fund - -
TCG Stock Fund 11,631 1,165
---------- ----------
$ 215,831 $ 148,530
========== ==========
Net realized and unrealized appreciation
of investments as determined by
quoted market prices:
Merrill Lynch & Co. Common Stock Fund $ 712,517 $ 351,212
TCG Stock Fund 2,664,869 49,768
---------- ----------
$3,377,386 $ 400,980
========== ==========
Net investment gain from registered investment
companies:
Corporate Bond Fund $ 119,497 $ 38,329
Capital Fund 876,127 378,018
Basic Value Fund 1,800,840 703,880
Growth Fund for Investment and Retirement 2,437,832 2,452,210
---------- ----------
$5,234,296 $3,572,437
========== ==========
9
<PAGE>
4. ALLOCATION OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
The following is a summary of the allocation, by fund, of net assets
available for benefits at December 31, 1997 and 1996:
1997 1996
---- ----
Corporate Bond Fund $ 1,592,164 $ 1,294,331
Capital Fund 5,380,912 3,525,662
Basic Value Fund 8,939,047 5,355,997
Growth Fund for Investment
and Retirement 17,678,105 11,629,539
Merrill Lynch & Co. Common Stock Fund 1,592,759 920,192
Retirement Reserves Money Fund 4,139,528 3,509,629
TCG Stock Fund 6,399,014 1,153,113
CMA Money Fund - 29,321
Loan Fund 1,407,871 943,882
------------ ------------
Net assets available for benefits $ 47,129,400 $ 28,361,666
============ ============
10
<PAGE>
5. OTHER INFORMATION RELATED TO CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
Other changes in net assets available for benefits, by fund, for the years
ended December 31, 1997 and 1996 were as follows:
1997 1996
---- ----
Employer contributions:
Corporate Bond Fund $ 142,042 $ 121,907
Capital Fund 383,227 277,316
Basic Value Fund 685,085 452,778
Growth Fund for Investment and Retirement 1,488,952 1,098,716
Retirement Reserves Money Fund 693,001 454,416
TCG Stock Fund 419,364 38,743
---------- ----------
Total $3,811,671 $2,443,876
========== ==========
Participant contributions:
Corporate Bond Fund $ 237,277 $ 210,321
Capital Fund 698,351 510,929
Basic Value Fund 1,257,825 850,084
Growth Fund for Investment and Retirement 2,792,001 2,023,845
Retirement Reserves Money Fund 440,461 342,956
TCG Stock Fund 725,924 42,338
---------- ----------
Total $6,151,839 $3,980,473
========== ==========
Rollover contributions:
Corporate Bond Fund $ 8,858 $ 101,673
Capital Fund 139,287 233,491
Basic Value Fund 234,624 765,505
Growth Fund for Investment and Retirement 499,929 935,794
Retirement Reserves Money Fund 111,663 665,565
TCG Stock Fund 353,813 2,170
---------- ----------
Total $1,348,174 $2,704,198
========== ==========
Distributions to participants:
Corporate Bond Fund $ 76,737 $ 39,436
Capital Fund 266,541 104,726
Basic Value Fund 335,740 128,924
Growth Fund for Investment and Retirement 820,645 533,247
Retirement Reserves Money Fund 801,340 57,955
Merrill Lynch & Co. Common Stock Fund 28,151 5,806
Loan Fund 29,040 37,098
TCG Stock Fund 25,183 -
---------- ----------
Total $2,383,377 $ 907,192
========== ==========
Transfer in from the Eastern TeleLogic
Corporation Retirement Savings Plan:
Corporate Bond Fund $ 29,882 $ -
Capital Fund 124,852 -
Basic Value Fund 250,610 -
Growth Fund for Investment and Retirement 379,433 -
Retirement Reserves Money Fund 62,431 -
TCG Stock Fund 164,706 -
---------- ----------
Total $1,011,914 $ -
========== ==========
Transfers from (to) other funds:
Corporate Bond Fund $ (162,986) $ (110,780)
Capital Fund (100,053) (208,366)
Basic Value Fund (310,194) (252,121)
Growth Fund for Investment and Retirement (728,936) (1,008,312)
Retirement Reserves Money Fund (93,249) 43,522
Merrill Lynch & Co. Common Stock Fund (28,388) (34,820)
Loan Fund 930,777 551,948
TCG Stock Fund 493,029 1,018,929
---------- ----------
Total $ - $ -
========== ==========
11
<PAGE>
6. SUBSEQUENT EVENT
On January 8, 1998, TCG entered into an Agreement and Plan of Merger
(the "AT&T Agreement") with AT&T and TA Merger Corp., a Delaware
corporation and a wholly-owned subsidiary of AT&T ("AT&T Merger
Sub"), pursuant to which, subject to satisfaction of the closing
conditions specified therein, AT&T Merger Sub would merge with and into
TCG, with TCG surviving as a wholly-owned subsidiary of AT&T (the "AT&T
Merger").
There can be no assurance that the AT&T Merger will be successfully
consummated or, if successfully completed, when it might be completed.
On or about July 15, 1998 the AT&T Merger is expected to close.
The TCG Plan will terminate immediately preceding the consummation of
the Merger with AT&T. Participants of the Plan will have the option to
roll over into the AT&T Long Term Savings Plan, which is a Defined
Contribution Plan, or an IRA, or take a distribution that will be
subject to an early withdrawal penalty and taxes. Participants will be
designated as Management employees or Occupational employees based on
band level and job description.
Management employees will enroll in the Long Term Savings Plan with
Fidelity as the record keeper. Upon joining AT&T, participation in the
plan is immediate. Employees can elect to contribute from 2% to 16% of
their salary and after one year of service, including TCG service, AT&T
will match 66 2/3% of the first 6% contributed. Employees can designate
which Fidelity funds the Company match will roll into.
Occupational employees will enroll in the Long Term Savings Plan with
Wells Spring as the record keeper. Six consecutive months of service is
required for participation in the plan, including TCG service. Employees
can elect to contribute from 2% to 16% of their salary and after one
year of service, which includes TCG service, AT&T will match 66 2/3% of
the first 6% contributed based on a matching contribution table. The
company match will go directly to the purchase of shares in the AT&T
Stock Fund.
* * * * * *
12
<PAGE>
TELEPORT COMMUNICATIONS GROUP INC.
RETIREMENT SAVINGS PLAN
<TABLE>
<CAPTION>
ITEM 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT
DECEMBER 31, 1997
- -------------------------------------------------------------------------------------------------------
Description of Current
Identity of Issue Investment Cost Value
<S> <C> <C>
Merrill Lynch Retirement Reserves Money Fund Money Market Fund $ 3,963,668 $ 3,943,470
Merrill Lynch & Co. Common Stock Fund Common Stock 312,418 1,592,759
Merrill Lynch Corporate Bond Fund Mutual Fund 1,336,762 1,559,995
Merrill Lynch Capital Fund Mutual Fund 4,620,579 5,278,239
Merrill Lynch Basic Value Fund Mutual Fund 6,754,759 8,745,913
Merrill Lynch Growth Fund for Investment and Mutual Fund 13,798,412 17,269,289
Retirement
Loan Fund Loans receivable, 7 to 1,432,096 1,407,871
10 % interest, repaid
through bi-weekly
payroll deductions up
to 120 months
TCG Class A Common
TCG Stock Fund Stock Fund 3,351,867 6,231,211
------------- -------------
Total Assets Held for Investment $35,570,561 $46,028,747
============= =============
</TABLE>
13
<PAGE>
TELEPORT COMMUNICATIONS GROUP INC.
RETIREMENT SAVINGS PLAN
<TABLE>
<CAPTION>
ITEM 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1997
- ------------------------------------------------------------------------------------------------------------------------------------
Description of Number of Number of Total Value Total Value Net Gain/
Identity of Issue Assets Purchases Sales Purchases Sales (Loss)
<S> <C> <C> <C> <C> <C> <C>
Merrill Lynch Retirement Reserves Money Fund Money Market
Fund 239 133 $2,488,742 $1,967,486 $ -
Merrill Lynch Capital Fund Mutual Fund 137 132 1,944,567 520,728 40,138
Merrill Lynch Basic Value Fund Mutual Fund 185 174 3,180,851 898,920 124,186
Merrill Lynch Growth Fund for Investment and Mutual Fund 233 220 7,165,046 2,344,283 320,465
Retirement
CMA Money Fund Money Market
Fund 103 101 2,515,627 2,544,949 -
TCG Stock Fund TCG Class A
Common Stock
Fund 197 72 3,611,876 1,313,911 370,941
</TABLE>
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has caused this report to be signed on its behalf of the
undersigned, thereunto authorized.
TELEPORT COMMUNICATIONS GROUP INC.
Dated: June 30, 1998 By: /s/ Maria Terranova-Evans
-------------------------
Name: Maria Terranova-Evans
Title: Vice President and Controller
(Principal Accounting Officer)
