TOTAL-TEL USA COMMUNICATIONS, INC.
150 Clove Road
Little Falls, New Jersey 07424
NOTICE OF 1995
ANNUAL MEETING OF SHAREHOLDERS
To the Shareholders of
TOTAL-TEL USA COMMUNICATIONS, INC.:
You are cordially invited to attend the 1995 Annual Meeting of
Shareholders of Total-Tel USA Communications, Inc. which will be held at 150
Clove Road, 8th Floor, Little Falls, New Jersey, 07424 at 1:00 P.M. on
Wednesday, September 20, 1995, for the following purposes:
(1) To elect directors and;
(2) To transact such other business as may properly
come before the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on August 14,
1995, as the record date for the determination of shareholders entitled to
notice of and to vote at the meeting. The share transfer books will not be
closed.
YOU ARE EARNESTLY REQUESTED, WHETHER OR NOT YOU PLAN TO BE PRESENT AT
THE MEETING, TO MARK, DATE, SIGN AND RETURN PROMPTLY THE ACCOMPANYING PROXY,
TO WHICH NO POSTAGE NEED BE AFFIXED IF MAILED IN THE UNITED STATES. IF YOU
ATTEND THE MEETING IN PERSON, YOU MAY WITHDRAW THE PROXY AND VOTE YOUR OWN
SHARES.
By order of the Board of Directors.
Thomas P. Gunning
Secretary
August 20, 1995
Little Falls, New Jersey
TOTAL-TEL USA COMMUNICATIONS, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
September 20, 1995
The proxy accompanying this Proxy Statement is solicited by the Board
of Directors of TOTAL-TEL USA COMMUNICATIONS, INC. (the "Company"). All
proxies in the accompanying form which are properly executed and duly
returned will be voted in accordance with the shareholders' instructions
thereon at the 1995 Annual Meeting of Shareholders (the "Meeting"), to be
held on Wednesday, September 20, 1995 at 1:00 P.M., at 150 Clove Road, 8th
Floor, Little Falls, New Jersey, 07424 for the purposes set forth in the
accompanying Notice of Annual Meeting of Shareholders.
Any proxy may be revoked at any time before it is voted at the meeting
by filing with the Secretary of the Company notice to such effect or a duly
executed proxy bearing a later date. If no instructions are indicated, the
proxies will be voted in accordance with management's recommendations set
forth herein. The persons named as proxies intend to vote in accordance with
their discretion on any matters which may properly come before the Meeting
or any adjournment thereof. Shareholders who are present at the Meeting may
revoke their proxies and vote in person if they so desire.
This Proxy Statement is first being mailed to shareholders on or about
August 20, 1995.
MATTERS TO BE ACTED UPON
1. Five (5) directors are to be elected to hold office until the next
Annual Meeting of Shareholders and until their respective successors are
duly elected and qualified.
2. To transact such other business as may properly come before the
Meeting or any adjournment thereof.
SHARE OWNERSHIP OF DIRECTORS, OFFICERS AND
CERTAIN BENEFICIAL OWNERS
Only holders of record of the Company's Common Stock at the close of
business on August 14, 1995 will be entitled to vote at the Meeting. On
that date, there were issued and outstanding 1,449,750 Common shares of the
Company. Each outstanding Common share is entitled to one vote at the
Meeting.
Security Ownership of Certain Beneficial Owners
Set forth below is certain information concerning persons who were
known by the Company to own beneficially or of record more than 5% of the
issued and outstanding shares of Common Stock of the Company as of August
14, 1995.
Name and Address Number of Shares Percentage
of Beneficial Owner Owned (1) of Class
------------------- -------- -------
Manuel Brucker 159,684 shares 9.4%
Claridge House One, Apt 711
Claridge Drive
Verona, NJ 07044
Solomon Feldman 238,095 shares 14.5%
1890 South Ocean Drive
Hallandale, FL 33009
Warren H. Feldman, Esq. 273,510 shares (2) 16.7%
150 Clove Road
Little Falls, NJ 07424
Michael A. Karp 109,670 shares 6.7%
3416 Sansom Street
Philadelphia, PA 19104
Heartland Advisors, Inc. 140,500 shares 8.6%
790 North Milwaukee Street
Milwaukee, WI 53202
Kevin Alward 111,975 shares (3) 6.8%
150 Clove Road
Little Falls, NJ 07424
(1) All shares are beneficially owned and sole investment and
voting power is held by the persons named.
(2) Includes options to purchase 92,808 shares of the Company's
Common Stock which are currently exercisable or within 60 days
hereof.
(3) Includes options to purchase 94,125 shares of the Company's
Common Stock which are currently exercisable or within 60 days
hereof.
Security Ownership of Management
The following table sets forth as of August 14, 1995 information concerning
the beneficial owners of outstanding shares of Common Stock of the Company
by each director of the Company, each nominee for election as a director and
all directors and officers of the Company as a group:
Name and Address Number of Shares Percentage
of Beneficial Owner Owned (1) of Class
----------------- -------- -------
Solomon Feldman 238,095 shares 14.5 %
Warren H. Feldman 273,510 shares (2) 16.6 %
Marc Balmuth --- ---- %
Jay J. Miller --- ---- %
Jerold L. Zaro 11,000 shares .7 %
All directors
and officers
as a group (5 in number) 631,116 shares (2) 38.4 %
(1) All shares are beneficially owned and sole investment and
voting power is held by the persons named.
(2) Includes options to purchase 92,808 shares of the Company's
Common Stock which are currently exercisable or within 60
days hereof.
Changes in Control
The Company knows of no contractual arrangement which may, at a
subsequent date, result in a change of control of the Company.
ANNUAL REPORT
The Annual Report of the Company for the fiscal year ended January 31,
1995 including financial statements, is being mailed to shareholders
together with this Proxy Statement. No part of such Annual Report shall be
regarded as proxy soliciting material or as a communication by means of
which any solicitation is being or is to be made.
ELECTION OF DIRECTORS
The Board of Directors has fixed the number of directors to be elected
at the Annual Meeting of Shareholders at five. The shares represented by
the proxies will be voted in favor of the election as directors of the
persons named below unless authority to do so is withheld. The directors
elected will hold office until the next Annual Meeting of Shareholders and
their respective successors are duly elected and qualify. If any nominee is
not a candidate for election at the meeting, an event which the Board of
Directors does not anticipate, the proxies will be voted for a substitute
nominee and the others named below.
Director
Name Company Office Since Age
---- -------------- ----- ---
Marc Balmuth Director 1993 48
Solomon Feldman Treasurer and Director 1959 74
Warren H. Feldman Chairman, President and 1987 39
Chief Executive Officer
Jay J. Miller Director 1983 62
Jerold L. Zaro Director 1991 44
Mr. Marc Balmuth was elected as a director of the Company in May, 1993.
Mr. Balmuth is currently the President of the Caldor discount department store
chain and has held that position since early 1987. From 1985 to 1987, Mr.
Balmuth was Executive Vice President of the Venture discount chain of St.
Louis, Missouri. Prior to joining Venture, Mr. Balmuth held various
executive positions in the retail industry. Mr. Balmuth is the son-in-law
of Manuel Brucker, a former officer and director and a principal shareholder
of the Company.
Mr. Solomon Feldman has served as the Treasurer and as a director of
the Company continuously since 1959. Mr. Feldman is currently a private
investor and devotes approximately 25% of his time to the business of the
Company.
Mr. Warren H. Feldman was elected Chairman of the Board in September
1993 and President and Chief Executive Officer of the Company in September,
1992. Prior to such time, he served as Vice President - Regulatory Affairs
of the Company since January, 1986 and was the General Manager of its
Total-Tel USA division and in-house General Counsel of the Company since
1984. He was elected a director on April 1, 1987 and President of Total-Tel
USA Division on October 27, 1988. Warren H. Feldman is the son of Mr.
Solomon Feldman.
Jay J. Miller, Esq. has been a practicing attorney for more than thirty
years in the State of New York. Mr. Miller is a director of Vestro Natural
Foods Inc., a specialty food firm, and Edison Control Corporation, a
manufacturer of electronic fault indicators for the power utility industry.
He was elected Chairman of the Board of Gulf USA Corporation, a property and
natural resource company in reorganization, and a director of its New
Zealand real estate subsidiary, Gulf Resources Pacific Ltd., in the latter
part of 1993.
Jerold L. Zaro was elected a director of the Company in August, 1991.
Mr. Zaro joined the firm of Ansell, Zaro, Bennett and Grimm, a law firm
engaged in the general practice of law in Eatontown, New Jersey in 1976 and
has been President and Managing Partner since 1985. Mr. Zaro is a director
of First Dewitt Bank, a New Jersey state chartered banking institution. Mr.
Zaro is also a Commissioner of the New Jersey Highway Authority, which owns,
operates and maintains the Garden State Parkway and the Garden State Arts
Center.
Board of Directors
The Company's Board of Directors currently consists of six persons, of
whom two are members of management and four are non- management directors.
During the fiscal year ended January 31, 1995, the Board held four meetings
attended by all of the directors.
The Company's Board of Directors has Audit and Compensation Committees
but does not have a Nominating Committee or a committee performing a similar
function. The Audit Committee consists of two management directors and two
non-management directors, namely Messrs. Miller, Zaro, Warren Feldman and
Solomon Feldman. The Committee reviews, analyzes and may make
recommendations to the Board of Directors with respect to the Company's
financial statements and controls. The Committee has met and intends to
meet from time to time with the Company's independent public accountants to
monitor their activities. The Compensation Committee consists of Messrs.
Balmuth, Miller and Warren Feldman and is charged with reviewing and
recommending the compensation and benefits payable to the Company's senior
executives.
Required Shareholders' Vote
Assuming the presence of a quorum (a majority of the total issued and
outstanding shares of Common Stock of the Company), the favorable vote of
the holders of a plurality of the shares present and voting at the Meeting
for the election of each nominee is required for his election.
EXECUTIVE COMPENSATION
The following table sets forth the compensation which the Company paid
during the fiscal years ended January 31, 1995, 1994, and 1993 to the Chief
Executive Officer and to each executive officer of the Company or subsidary
whose aggregate remuneration exceeded $100,000:
<TABLE>
<CAPTION>
Summary Compensation Table
--------------------------
Name and Fiscal Year Annual Compensation Compensation
Principal Ended ------------------- Other Annual Awards All Other
Position January 31 Salary ($) Bonus ($) Compensation Options (#) Compensation
-------- ---------- ---------- ---------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C>
Warren H. Feldman 1995 $195,103 (1) $ 74,153 15,000 (2) $4,583 (4)
President and 1994 $149,651 (1) $ 63,748 19,250 (3) $4,167 (4)
Chief Executive 1993 $ 94,584 (1) -- $2,408 (6)
Officer since
September 1992
Kevin Alward 1995 $195,000 $ 63,700 31,500 (7)(8) $5,256 (9)
President of
Total Tel, Inc.
since 1994
1) Does not include annual director's fee of $15,000
(2) Represents incentive options to purchase 15,000 shares of Common Stock
exercisable at a price of $19.25 per share (110% of the market price at the
date of issue). These options vest over a period of forty-eight (48)
months, with 25% of each option exercisable at the 12th, 36th and 48th
months of its term, subject to earlier vesting in certain circumstances as
provided in the option agreement.
(3) Represents incentive stock options to purchase 19,250 shares of Common
Stock exercisable at a price of $5.40 per share adjusted for the 10% stock
dividend issued July 15, l994. These options vest over a period of
thirty-six (36) months with 25% of each option exercisable at the 6th, 12th
and 36th months of its term, subject to earlier vesting in certain
circumstances as provided in the option agreements.
(4) The amount shown represents the Company's contribution under its 401(K)
Deferred Compensation and Retirement Savings Plan of $2,226 and $2,357 for
the use of a company vehicle for non- business purposes.
(5) The amount shown represents the Company's contribution under its 401(K)
Deferred Compensation and Retirement Savings Plan of $1,810 and $2,357 for
the use of a company vehicle for non- business purposes.
(6) The amounts shown represents the Company's contribution under its 401 (K)
Deferred Compensation and retirement Savings Plan of $924 and $1,484 for the
use of a company vehicle for non business purposes.
(7) Represents incentive options to purchase 16,500 shares of Common Stock
exercisable at a price of $14.55 per share, adjusted for the 10% stock
dividend issued in July 1994. These options vest over a period of
thirty-six (36) months with 25% of each option exercisable at the 8th, 12th,
24th and 36th month of its term, subject to earlier vesting in certain
circumstances as provided in the option agreement.
(8) Represents incentive options to purchase 15,000 shares of Common Stock
exercisable at a price of $17.50 per share. These options vest over a
period of forty- eight (48) months with 25% of each option exercisable at
the 12th, 24th, 36th and 48th month of its term, subject to earlier vesting
in certain circumstances as provided in the option agreement.
(9) The amount shown represents the Company's contribution under its 401
(K) Deferred Compensation and Retirement Savings Plan of $1,556 and $2,643
for the use of a company vehicle for non business purposes and $1,057 term
life insurance premiums.
</TABLE>
Adoption of 401 (K) Savings and Investment Plan
On February 3, 1992, the Company adopted a 401 (K) plan for eligible
hourly and salaried employees, including officers, who may elect to
contribute, subject to Internal Revenue Code limitations, from 1% to 15% of
their wages and salaries. The contributions are invested in any one of six
investments funds, each of which has a different investment objective.
An employee may contribute up to $9,240 per year, and the Company will
match a certain percentage of each employee's contribution.
Other Compensation
See Summary Compensation Table.
Compensation of Directors
Each director of the Company receives $15,000 per year for service in such
capacity.
Compensation Committee Report on Executive Compensation
Total-Tel USA Communications, Inc. has grown substantially over the
past five years. The Board of Directors has retained the Company's
executive officers based not only upon the size and needs of the Company at
the present time, but with due consideration of their ability to lead a
substantially larger organization in the future.
The Compensation Committee believes that the Company provides salaries
to the Company's executive officers in amounts comparable to other companies
in the geographical area in which the Company operates with similar
operating and growth characteristics
The salary and other compensation paid to the Chief Executive Officer
of the Company in the fiscal year ended January 31, 1995 was determined
primarily based upon the following factors:
1. Compensation level of chief executive officers of companies of like
size and similar growth and earning characteristics.
2. Responsibilities and tasks to be achieved within the Company.
Respectfully submited,
Marc Balmuth
Warren H. Feldman
Jay J. Miller
Stock Performance Chart
The following table is the source data for the for the line chart which
appears at this point in the printed document. This table is not part of the
original printed document and is shown for reference only.
The cumulative total return to shareholders (stock price appreciation)
during the previous five years in comparison to returns of the NASDAQ
Stock Market (U.S.) Index and a peer group index. The peer group index used
is the NASDAQ Telecommunications Stock Index.
1995 Proxy
----------
10% Stock
TTU Dividend Factor
Stock 7/15/94. 19.323671
--------- ------ -------- ---------
1-31-90 5.750 5.175 100.000
1-31-91 4.625 4.163 80.444
1-31-92 3.750 3.375 65.217
1-31-93 4.250 3.625 73.913
1-31-94 16.500 14.850 286.957
1-31-95 17.250 17.250 333.333
1995 Proxy
----------
NASDAQ Factor
Compositive .811116
----------- ------- ---------
1-31-90 246.927 100.000
1-31-91 127.295 103.251
1-31-92 94.727 157.946
1-31-93 220.120 178.543
1-31-94 253.136 205.323
1-31-95 241.553 195.927
Factor
PEER GROUP .404978
---------- ------- --------
1-31-90 246.927 100.000
1-31-91 217.549 88.103
1-31-92 282.040 114.200
1-31-93 348.270 141.042
1-31-94 517.867 209.725
1-31-95 432.190 175.027
Assumes $100 invested at the close of trading on the last trading day
preceding the first day of the fifth preceding fiscal year in Total-Tel
Common Stock, NASDAQ Stock Market (US) Index, and Peer Group.
*Cumulative total return assumes reinvestment of dividends.
Certain Relationships and Related Transactions
On December 1, 1993, the Company leased approximately 21,300 square feet of
warehouse space in Belleville, New Jersey from a partnership in which a
director and a principal shareholder of the Company is a partner. During
the fiscal year ended January 31, 1994, the Company paid rent of $4,880 to
the partnership. The annual rent for this facility is $58,560 for the first
three years and $63,885 for years four and five.
The foregoing transactions were upon terms considered by the Management to
be not less favorable to the Company than like transactions negotiated at
arms' length.
(Balance of this page intentionally left blank)
PROPOSALS OF
SHAREHOLDERS FOR 1996 ANNUAL MEETING
Proposals of shareholders intended to be presented for action at the
1996 Annual Meeting of Shareholders must be received at the Company's
offices not later than May 15, 1996 to be considered for inclusion in the
Company's proxy statement and form of proxy relating to that meeting. The
terms and conditions of Rule 14a-8 under the Securities Exchange Act of 1934
shall apply to any such submission.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Deloitte & Touche LLP or a predecessor, has served as the independent
certified public accountants of the Company since 1962. The Company intends
to appoint Deloitte & Touche LLP as its independent certified public
accountants for the fiscal year ending January 31, 1996. Deloitte & Touche LLP
has indicated that it expects to have a representative at the Meeting. The
representative will be afforded an opportunity to make a statement, if he
desires, and will be available to respond to appropriate shareholder
questions.
VOTING AND SOLICITATION OF PROXIES
The solicitation of proxies in the accompanying form is made by the
Company's Board of Directors , and the cost thereof will be borne by the
Company. The Company may solicit proxies by mail, telephone, or telegraph.
Brokerage firms, custodians, banks, trustees, nominees or other persons
holding shares in their names, will be reimbursed for their reasonable
expenses in forwarding proxy materials to their principals.
As of the date of this Proxy Statement, the Board of Directors is not
aware of any other matter to be presented before the Meeting. In the event
any other matter is properly brought before the Meeting, it is intended that
the persons voting the accompanying proxy will vote the shares represented
thereby in accordance with their best judgment.
It is important that proxies be returned promptly. Therefore, whether
or not you plan to attend in person, you are asked to execute and return
your proxy in the enclosed postage prepaid envelope.
By Order of the Board of Directors.
Thomas P. Gunning
August 20, 1995 Secretary
TOTAL-TEL USA COMMUNICATIONS, INC.
1995
ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints WARREN FELDMAN and THOMAS GUNNING, or
either of them, attorneys and proxies with full power of substitution and
with all the powers the undersigned would possess if personally present, to
vote all stock of the undersigned in TOTAL-TEL USA COMMUNICATIONS, INC. at
the 1995 Annual Meeting of Shareholders, to be held on September 20, 1995 at
1:00 P.M. at 150 Clove Road, Little Falls, New Jersey, 07424 or at any
adjourned session thereof. Said proxies are directed to vote the shares the
undersigned would be entitled to vote upon the following matters, more fully
described in the accompanying Proxy Statement:
(1) Election of Director
( ) FOR all nominees (except ( ) WITHHOLD AUTHORITY
as authority is withheld to vote for all
by striking a line through nominees
the nominee's name)
Marc Balmuth Solomon Feldman
Warren H. Feldman Jay J. Miller
Jerold L. Zaro
In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment or
postponement thereof.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
INSTRUCTIONS SET FORTH ABOVE. IF NO INSTRUCTIONS ARE GIVEN, THE SHARES
REPRESENTED BY THIS PROXY WILL BE VOTED FOR THE NOMINEES FOR DIRECTORS AND
FOR THE PROPOSED AMENDMENT TO THE STOCK OPTION PLAN.
Dated:______________, 1995
_______________________________
_______________________________
Signature(s) of Shareholder(s)
Please sign exactly as name or names appear hereon. Kindly sign and return
this proxy immediately. No postage required if mailed in the United States
in the accompanying envelope.
THIS PROXY IS SOLICITED ON BEHALF OF
HE COMPANY'S BOARD OF DIRECTORS
