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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 8)*
Total-Tel USA Communications, Inc.
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(Name of Issuer)
Common Stock, par value $.05 per share
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(Title of Class of Securities)
89151T 10-6
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(CUSIP Number)
Walt Anderson
c/o Shereff, Friedman, Hoffman & Goodman, LLP
919 Third Avenue
New York, New York 10022
Attn: Richard A. Goldberg (212) 758-9500
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(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
July 27, 1998
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(Date of Event which Requires Filing of
this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
statement because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box: [ ].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7(b) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities,
and for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 ("Act") or otherwise subject to the liabilities of that section of
the Act but shall be subject to all other provisions of the Act (however, see
the Notes).
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<TABLE>
<CAPTION>
SCHEDULE 13D
- ------------------------------------------ ---------------------------- --------------------------------------------
<S> <C>
CUSIP No. 89151T 10-6 Page 2 of 5 Pages
- -------- -----------------------------------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Walt Anderson
- -------- -----------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [ ]
- -------- -----------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- -------- -----------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
- -------- -----------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
[ ]
- -------- -----------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States
- --------------------- ------ ---------------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES 1,857,634 (includes shares pursuant to an agreement to purchase 138,000 shares of
BENEFICIALLY Common Shares)
OWNED BY
EACH
REPORTING
PERSON
WITH
------ ---------------------------------------------------------------------------------------
8 SHARED VOTING POWER
0
------ ---------------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
1,857,634 (includes shares pursuant to an
agreement to purchase 138,000 shares of Common
Shares)
------ ---------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------- -----------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,857,634 (includes shares pursuant to an agreement to purchase
138,000 shares of Common Shares)
- -------- -----------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- -------- -----------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
26.9%
- -------- -----------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
- -------- -----------------------------------------------------------------------------------------------------------
</TABLE>
2
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<TABLE>
<CAPTION>
SCHEDULE 13D
- ------------------------------------------ ---------------------------- --------------------------------------------
CUSIP No. 89151T 10-6 Page 3 of 5 Pages
- -------- -----------------------------------------------------------------------------------------------------------
<S> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Revision LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
- -------- -----------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
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4 SOURCE OF FUNDS
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
- -------- -----------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
1,857,634 (includes shares pursuant to an agreement to purchase 138,000
NUMBER OF shares of Common Stock)
SHARES
BENEFICIALLY
OWNED BY ------ ---------------------------------------------------------------------------------------
EACH 8 SHARED VOTING POWER
REPORTING 0
PERSON ------ ---------------------------------------------------------------------------------------
WITH 9 SOLE DISPOSITIVE POWER
1,857,634 (includes shares pursuant to an agreement to
purchase 138,000 shares of Common Stock)
------ ---------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- -------- -----------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,857,634 (Includes shares pursuant to an agreement to purchase
138,000 shares of Common Stock)
- -------- -----------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ]
- -------- -----------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
26.9%
- -------- -----------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
- -------- -----------------------------------------------------------------------------------------------------------
</TABLE>
3
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AMENDMENT NO. 8 TO SCHEDULE 13D
This Amendment No. 8 ("Amendment No. 8") to Schedule 13D filed by
Revision LLC, a Delaware limited liability company ("Revision"), and Walt
Anderson, a natural person and a U.S. citizen ("Mr. Anderson"), as joint
filers, with respect to the common stock, par value $0.05 per share (the
"Common Shares"), of Total-Tel USA Communications, Inc., a New Jersey
corporation (the "Issuer"), supplements Items 4 and 7 of the Schedule 13D
previously filed with the Securities and Exchange Commission (the "SEC") by
Gold & Appel, a British Virgin Islands corporation ("Gold & Appel"), and Mr.
Anderson as joint filers on January 16, 1998 (the "Schedule 13D"), as amended
by Amendment No. 1 thereto filed with the SEC on January 30, 1998 ("Amendment
No. 1"), Amendment No. 2 thereto filed with the SEC on February 13, 1998
("Amendment No. 2"), Amendment No. 3 thereto filed with the SEC on March 4,
1998 ("Amendment No. 3"), Amendment No. 4 thereto filed with the SEC on March
13, 1998 ("Amendment No. 4"), Amendment No. 5 thereto filed with the SEC on
March 30, 1998 ("Amendment No. 5"), Amendment No. 6 thereto filed with the SEC
on April 6, 1998 ("Amendment No. 6") and Amendment No. 7 thereto filed with the
SEC on June 12, 1998 ("Amendment No. 7"). All capitalized terms used and not
defined herein shall have the meanings ascribed to them in the Schedule 13D, as
amended by Amendment No. 1, Amendment No. 2, Amendment No. 3, Amendment No. 4,
Amendment No. 5, Amendment No. 6 and Amendment No. 7. All data included in this
Amendment No. 8 reflects a 2 for 1 stock split of the Common Shares which was
effected on July 15, 1998.
ITEM 4. PURPOSE OF THE TRANSACTION.
The response set forth in Item 4 of the Schedule 13D is hereby
supplemented as follows:
On July 27, 1998, counsel to Revision, on behalf of Revision, sent a
letter dated July 27, 1998 (the "Letter") to counsel to the Issuer, alleging
various improprieties by the Board of Directors and officers of the Issuer,
including breach of their fiduciary duties to the shareholders of the Issuer
and corporate waste. The Letter cites specific examples of questionable conduct
by the Board and officers and demands that an independent investigation be
conducted to examine such conduct and to determine whether legal recourse
should be taken by the Issuer. A copy of the Letter is attached hereto as
Exhibit 7.1.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
The responses set forth in (a) and (b) of Item 5 of the Schedule 13D
are hereby amended and restated in their entirety as follows:
(a) The Reporting Persons, collectively, beneficially own 1,857,634
Common Shares (of which 138,000 Common Shares have not yet been acquired but
may be acquired on October 1, 1998 but not later than October 5, 1998 pursuant
to the Agreement and are subject to the Proxy) or 26.9% of the outstanding
Common Shares. Mr. Anderson directly owns 100 Common Shares or less than .01%
of the outstanding Common Shares. Revision directly owns 1,857,634 (of which
138,000 Common Shares have not yet been acquired but may be acquired on October
1, 1998 but not later than October 5, 1998 pursuant to the Agreement and are
subject to the Proxy) or 26.9% of the outstanding Common Shares.
4
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In addition, Mr. Anderson is the President and a Director of the
Foundation for International Non-Governmental Development of Space, a
non-profit organization ("FINDS") which owns 70,930 Common Shares. Mr. Anderson
does not have a controlling interest in FINDS and thus disclaims beneficial
ownership of the Common Shares held by FINDS.
(b) The sole power to vote or direct the voting of and the power to
dispose or direct the disposition of the Anderson Shares is held by Mr.
Anderson.
As the Manager and holder of 100% of the voting membership interests
in Revision, Mr. Anderson has the sole power to vote or direct the voting of
1,857,634 Common Shares (which includes 138,000 Common Shares which may be
acquired under the Agreement and may be voted by Revision pursuant to the
Proxy) and the power, in the name and on behalf of Revision, to dispose of the
1,719,434 Common Shares beneficially owned by Revision. Accordingly, Mr.
Anderson may be deemed to be the beneficial owner of the Revision Shares, and
thereby the beneficial owner of 1,857,634 or 26.9% of the outstanding Common
Shares.
The number of shares beneficially owned by each of the Reporting
Persons and the percentage of outstanding shares represented thereby, have been
computed in accordance with Rule 13d-3 under the Securities Exchange Act of
1934, as amended. The ownership of the Reporting Persons is based on 6,905,954
outstanding Common Shares of the Issuer as of June 12, 1998, as reported in the
Issuer's Quarterly Report on Form 10-Q for the quarterly period ended April 30,
1998.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
Exhibit 7.1 Letter from counsel to Revision to counsel to the Issuer, dated
July 27, 1998.
5
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SIGNATURE
After reasonable inquiry and to the best of the undersigned's
knowledge and belief, the undersigned certifies that the information set forth
in this statement is true, complete and correct.
Dated: July 29, 1998
REVISION LLC
By: /s/ Walt Anderson
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Walt Anderson, Manager
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EXHIBIT INDEX
Exhibit Description
- ------- -----------
Exhibit 7.1 Letter from counsel to Revision to counsel to the Issuer, dated
July 27, 1998.
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Exhibit 7.1
SWIDLER
&
BERLIN
MICHAEL J. LICHTENSTEIN CHARTERED DIRECT DIAL
ATTORNEY-AT-LAW (202) 424-7708
[email protected]
July 27, 1998
BY TELECOPIER
Bobby R. Burchfield, Esquire
Covington & Burling
1201 Pennsylvania Ave., N.W.
Washington, D.C. 20044
Re: Total-Tel USA Communications, Inc.
Dear Bobby:
As you know, this firm represents Revision, L.L.C., Total-Tel's
largest shareholder. As a major shareholder, Revision is concerned that for the
past several years the Board of Directors has failed to lead Total-Tel in an
appropriate manner designed to maximize shareholder value and may have violated
SEC rules and regulations. Indeed, based upon discovery in the case filed
against Total-Tel, Revision has learned that the Directors may have breached
their duty to shareholders. They also appear to have used the corporation for
personal gain and have wasted opportunities to enhance shareholder value
through the failure properly to consider merger or acquisition offers. Revision
has been made aware of a number of such issues, which include the following:
*In 1993, Total-Tel entered into a lease for a warehouse that is
owned by a partnership consisting of Solomon Feldman and his sons, Warren, Cary
and Gerald. The annual payments under the Warehouse Lease are $58,560 for the
first three years and $62,885 for years four and five. No Board of Directors
vote was ever taken to approve the Warehouse Lease and no study was
commissioned to determine whether the terms of the Warehouse Lease are
equivalent to market terms. Such a transaction certainly should have been
carefully reviewed by independent directors.
3000 K Street, N.W. - Suite 300
Washington, DC 20007-5116
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Bobby R. Burchfield, Esquire
July 27, 1998
Page 2
*Warren Feldman has his eleven year-old son Ross serving as a
Total-Tel agent. Ross Feldman receives commissions statements and apparently is
paid fees by Total-Tel.
*In the past six years, Warren Feldman's compensation has increased
from $117,329 to approximately $650,000, plus a BMW 750IL and a country club
membership.
*Warren Feldman's brother-in-law, Arthur Draznen, who is not a
Total-Tel employee, receives compensation from Total-Tel as an agent for
introducing two customers. We are advised, however, that Ken Alward and Ben
Goldberg, two Total-Tel employees, actually sold the accounts. Mr. Alward
testified under oath that it is unusual for a non-employee to continue to
receive a commission for a referral, like the commission Mr. Draznen receives
from Total-Tel.
*Warren Feldman's brother, Gerald, is or was paid a salary of
approximately $50,000 per annum to run Total-Tel's Los Angeles operation.
*Solomon Feldman, a director of Total-Tel, allegedly spends 25% of his
time on company business. Based upon documents produced by Total-Tel, it
appears that Solomon Feldman charges the company for various expenses,
including gas, meals and airfare for various trips.
*Angelo Gonnello, who is officially a Total-Tel mail room employee,
also acts as Warren Feldman's chauffeur and does errands for Warren Feldman. On
occasion, Mr. Gonnello has picked up Warren Feldman's children and has driven
them from place to place.
*Jay Miller, a director of Total-Tel, serves as outside corporate
counsel to the company. In 1998, Total-Tel has paid Mr. Miller in excess of
$135,000 for legal services rendered in 1997.
*Leon Genet, a director of Total-Tel, is also a shareholder, officer
and director of LPJ Communications, which has received more than $40,000 in
commissions from Total-Tel.
*In September, 1997, Kevin Alward, Total-Tel's president and a
director, without any explanation, was suddenly asked to step down as president
of Total-Tel and as president of Total-Tel's operating subsidiaries. Alward was
also asked to relinquish his position as a director of Total-Tel. Apparently,
the Directors failed to make any public disclosure about Alward's termination
and neglected to inform shareholders at the 1997 annual meeting.
*In the past nine years, Warren Feldman has had many discussions with
companies seeking to acquire or to merge with Total-Tel. For the most part, the
Board of Directors' minutes do not reflect any discussions regarding potential
mergers or acquisition of the company and apparently there have been no Board
votes regarding these issues. Potential partners or acquirors include Cable and
Wireless, Midatlantic Telecom, LCI, USLD, ACC, Qwest, Fonorola, Telco
Communications and RSL. Some of these offers would have resulted in enhanced
shareholder
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Bobby R. Burchfield, Esquire
July 27, 1998
Page 3
value but do not appear to have been given due consideration by the Board of
Directors. Leon Genet, a director, has testified that he was unaware of any
such offers.
The foregoing examples serve to highlight the problems with the way
the Board of Directors has been running Total-Tel. As a $100 million public
company, Total-Tel should not be run like a "mom and pop shop." Revision
believes that it is necessary, and as a major shareholder hereby demands, that
an independent investigation be conducted into such conduct to determine
whether Total-Tel should pursue legal recourse against the responsible officers
and directors. Because there are no independent directors, it is imperative
that an outside independent person be appointed to conduct the investigation.
Please let me know at your earliest convenience how the company
intends to proceed with the investigation of the officers and directors'
conduct.
Very truly yours,
/s/ Michael J. Lichtenstein
Michael J. Lichtenstein
cc: Mr. Walt Anderson
