<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 4)
TOTAL-TEL USA COMMUNICATIONS, INC.
(Name of Issuer)
COMMON STOCK, $.05 PAR VALUE PER SHARE
(Title of Class of Securities)
89151T 10-6
(CUSIP Number)
WARREN H. FELDMAN
150 CLOVE ROAD
LITTLE FALLS, NEW JERSEY 07424-0449
(201) 812-1100
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
SEPTEMBER 21, 1999
(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 Sections 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 Section 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).
<PAGE> 2
1 NAME(S) OF REPORTING PERSON(S)
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON(S) (ENTITIES ONLY)
WARREN H. FELDMAN, AND WARREN H. FELDMAN AND ESTHER FELDMAN
AS JOINT TENANTS
- ---------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)[ ] (b)[ ]
3 SEC USE ONLY
- ---------------------------------------------
4 SOURCE OF FUNDS
PF
- ---------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(d) or (e) [ ]
- ---------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
UNITED STATES OF AMERICA
- ---------------------------------------------
NUMBER OF (7) SOLE VOTING POWER 797,938
SHARES
BENEFICIALLY (8) SHARED VOTING POWER 0
OWNED BY
EACH (9) SOLE DISPOSITIVE POWER 797,938
REPORTING
PERSON (10) SHARED DISPOSITIVE POWER 0
WITH
- ---------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
797,938
- ---------------------------------------------
12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE
INSTRUCTIONS)[ ]
- ---------------------------------------------
<PAGE> 3
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
10.1594 %*
- ---------------------------------------------
14 TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN
- ---------------------------------------------
* BASED ON 7,854,182 SHARES OF COMMON STOCK OF THE ISSUER OUTSTANDING AS
OF SEPTEMBER 14, 1999, AS REPORTED ON THE ISSUER'S FORM 10-Q, DATED SEPTEMBER
14, 1999.
AMENDMENT NO. 4 TO SCHEDULE 13D
This Amendment No. 4 to Schedule 13D filed by Warren H. Feldman and
by Warren H. Feldman and Esther Feldman as Joint Tenants, each natural persons
and U.S. citizens ("Reporting Persons"), with respect to the common stock, par
value $0.05 per share (the "Common Stock"), of Total-Tel USA Communications,
Inc., a New Jersey corporation (the "Issuer"), supplements and amends the
Schedule 13D filed with the Securities and Exchange Commission ("SEC") by the
Reporting Persons on or about March 3, 1989, as amended by Amendment No. 1
thereto filed with the SEC on December 28, 1998, Amendment No. 2 thereto filed
with the SEC on February 8, 1999, and Amendment No. 3 thereto filed with the SEC
on February 12, 1999 (the "Schedule 13D").
ITEM 4. PURPOSE OF TRANSACTION.
The response set forth in Item 4 of the Schedule 13D is hereby
supplemented as follows:
Other as described herein and as previously reported, the Reporting
Persons have no plans or proposals which relate to, or would have any of the
results set forth in, sections (a)-(j) of this Item 4.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
The number of shares of Common Stock reported as beneficially owned
by the Reporting Persons in Amendment No. 1, Amendment No. 2 and Amendment No. 3
was inadvertently understated by 269,000 shares due to (i) the omission to take
into account employee stock options granted to Warren Feldman by the Issuer
which, as of the dates of Amendment No. 1, Amendment No. 2 and Amendment No. 3,
were exercisable concurrently or within the 60 days thereof to purchase 261,000
shares of Common Stock, and (ii) the omission to include 8,000 shares of Common
Stock registered in the name of the wife, mother-in-law and minor children of
Warren Feldman. Warren Feldman exercised options to purchase 140,778 shares of
Common Stock on July 29, 1999, and thereafter he held, and continues to hold as
of the
<PAGE> 4
date hereof, such shares as well as options to purchase a further 120,222 shares
of the Common Stock of the Issuer. The responses set forth in subsections (a)
and (b) of Amendment No. 3 are hereby amended and restated in their entirely as
follows:
(a) The Reporting Persons are the beneficial owners of 797,938
shares of Common Stock, which represents approximately 10.33%
of the shares of Common Stock outstanding as of December 15,
1998 (based on 7,721,004 shares of Common Stock of the Issuer
outstanding as of December 15, 1998, as reported on the
Issuer's Form 10-Q, dated December 15, 1998).
(b) The number of shares of Common Stock as to which the
Reporting Persons have:
(i) Sole power to vote or direct the vote: 797,938.
(ii) Shared power to vote or direct the vote: 0.
(iii) Sole power to dispose or to direct the disposition:
797,938.
(iv) Shared power to dispose or to direct the
disposition: 0.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR
RELATIONSHIPS WITH RESPECT TO THE SECURITIES OF THE ISSUER.
The response set forth in Item 6 to the Schedule 13D is hereby
supplemented as follows:
Pursuant to a Put Agreement, dated as of September 21, 1999 ("Put
Agreement"), by and among the Issuer, Revision LLC, a Delaware limited liability
corporation ("Revision"), Walt Anderson, a natural person ("Mr. Anderson"),
Warren Feldman and Solomon Feldman (the "Feldmans"), the Feldmans and one or
more of their respective designees will have the right (but not the obligation)
to sell some or all of their shares of Common Stock of the Issuer not to exceed
1,103,817 shares of Common Stock in the aggregate to Revision, and Revision will
be obligated to purchase such shares of Common Stock from the Feldmans and their
respective designees.
Also on September 21, 1999, Warren Feldman and the Issuer entered
into a Separation Agreement (the "Separation Agreement") providing, among other
things, for (i) the termination of the Employment Agreement, dated May 5, 1999,
by and between Warren Feldman and the Issuer (the "Employment Agreement"), and
(ii) the resignation by Warren Feldman from the office of Chairman of the Board
and as a member of the Board of Directors of the Issuer, which resignations will
become effective on October 7, 1999.
<PAGE> 5
The Put Agreement
The Put Agreement is filed as Exhibit No. 1 to this Amendment No.
4 and is incorporated herein by reference. The following summary of the
terms of the Put Agreement is qualified in its entirety by the provisions of
the Put Agreement.
GRANT OF PUT OPTION. Under the terms of the Put Agreement, the
Feldmans and their respective designees will have the right (but not the
obligation) to sell some or all of their shares of Common Stock of the Issuer
not to exceed 1,103,817 shares of Common Stock in the aggregate to Revision, and
Revision will be obligated to purchase such shares of Common Stock from the
Feldmans and their respective designees at a purchase price of $16 per share.
The option to put the shares may be exercised at any time during the period
beginning on December 11, 1999, and ending at 5:00 p.m. on February 10, 2000.
PROXY AND VOTING AGREEMENTS. If, at the time scheduled for the
closing of the put transaction, Revision is unable or unwilling to pay the full
purchase price for the securities subject to purchase from the Feldmans or their
designees, then Walt Anderson and Revision are each required to grant Warren
Feldman an irrevocable proxy to vote all shares of Common Stock held or owned by
Walt Anderson and/or Revision. This proxy will terminate automatically upon the
payment in full by Revision of the purchase price for the securities subject to
purchase from the Feldmans or their designees. In the Put Agreement, the parties
also agreed to termination of all existing agreements relating to the voting of
shares of the Issuer's Common Stock, including the agreement set forth in
Section 3(b) of the Stock Purchase Agreement, dated December 10, 1998, among
Walt Anderson, Warren Feldman, Solomon Feldman and Revision. A description of
the terms, as well as the full text, of the Stock Purchase Agreement is set
forth in Amendment No. 2 to the Schedule 13D or an exhibit thereto.
The Separation Agreement
The Separation Agreement is filed as Exhibit No. 2 to this
Amendment No. 4 and is incorporated herein by reference. The following
summary of the terms of the Separation Agreement is qualified in its entirety
by the provisions of the Separation Agreement.
TERMINATION OF EMPLOYMENT AGREEMENT. Under the terms of the
Separation Agreement, Warren Feldman will resign from the office of Chairman of
the Board and as a member of the Board of Directors of the Issuer. He will also
resign from each position he holds at any subsidiary of the Issuer. The
resignations will become effective on October 7, 1999. On that date the
Employment Agreement will be terminated and Warren Feldman will receive the
severance payment discussed below. The Issuer and Warren Feldman will each
release all claims against the other.
CONSIDERATION. In full satisfaction of all amounts payable under the
Employment Agreement and in consideration of the promises and covenants of
Warren Feldman made in the Separation Agreement, the Issuer has agreed to pay to
Warren Feldman the lump-sum amount of $650,000. By separate letter agreement
between Warren Feldman and Revision dated September 21, 1999 (the "Letter
Agreement"), Revision has agreed to pay Warren Feldman $250,000 to induce him to
enter into the Separation Agreement, the Put Agreement and for other
<PAGE> 6
good and valuable consideration. The Letter Agreement is filed as Exhibit No. 3
to this Amendment No. 4 and is incorporated herein by reference.
NON-COMPETE AND RELATED COVENANTS. In the Separation Agreement
Warren Feldman covenanted and agreed that he would not, during the period
commencing on October 7, 1999 and ending on the date twelve (12) months
thereafter, directly or indirectly, in any capacity, engage in or participate in
the management, ownership, or operation of any business or activity which
directly competes with the business conducted by the Issuer (as such business is
conducted on October 7, 1999) in the States of New York and New Jersey. In
addition, Warren Feldman covenanted and agreed that he would not, during the
period commencing on October 7, 1999 and ending on the date twenty-four (24)
months thereafter, directly or indirectly, employ or solicit the employment (or
assist any third party to employ or solicit the employment) of any person who
was engaged by the Issuer as an employee on September 1, 1999 (provided that the
foregoing prohibition will not apply to his executive assistant, or after
October 7, 2000, to (i) any person whose employment is involuntarily terminated
by the Issuer or (ii) any person who is not employed by the Issuer at the time
his employment is first solicited by Warren Feldman). During such twenty-four
month period, Warren Feldman also agreed not to call on any party that was a
customer of the Issuer on October 7, 1999 for the purpose of competing with the
Issuer by soliciting, diverting or taking away any customer of the Issuer
(provided that after October 7, 2000 this prohibition shall not apply to any
customer from which the Issuer has not billed or received a total of $10,000 in
payments for products or services during the six-month period prior to when such
customer is first solicited by Warren Feldman).
INDEMNIFICATION. The Separation Agreement provides that if Warren
Feldman is made a party or is threatened to be made a party to any action, suit,
or proceeding by reason of the fact he was a director or officer of the Issuer,
he will be indemnified and held harmless by the Issuer to the fullest extent
permitted by applicable law. In the Separation Agreement, the parties
acknowledged that the Indemnification Agreement dated March 6, 1998 between
Warren Feldman and the Issuer (the "Indemnification Agreement") is, and at all
times since March 6, 1998 has been, in full force and effect. The parties to the
Indemnification Agreement also acknowledged that Warren Feldman would be
entitled to the rights of indemnification provided in such agreement if at any
time after October 7, 1999, by reason of his status as an officer or director of
the Issuer, he is made a party to any proceeding.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<CAPTION>
Exhibit Number Description
<S> <C>
1. Put Agreement dated as of September 21, 1999, by and among
the Issuer, Revision LLC, Walt Anderson, Warren Feldman and
Solomon Feldman
2. Separation Agreement dated as of September 21, 1999, by and
between Warren Feldman and the Issuer
</TABLE>
<PAGE> 7
<TABLE>
<S> <C>
3. Letter Agreement dated September 21, 1999, by and between
Warren Feldman and Revision
</TABLE>
<PAGE> 8
SIGNATURES
After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certify that the information set forth in this
statement is true, complete and correct.
Dated: September 23, 1999
/s/ Warren Feldman
--------------------------------
Warren Feldman
/s/ Esther Feldman
--------------------------------
Esther Feldman
<PAGE> 9
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Number Description
<S> <C>
1. Put Agreement dated as of September 21, 1999, by and among
the Issuer, Revision LLC, Walt Anderson, Warren Feldman and
Solomon Feldman
2. Separation Agreement dated as of September 21, 1999, by and
between Warren Feldman and the Issuer
3. Letter Agreement dated September 21, 1999, by and between
Warren Feldman and Revision
</TABLE>
<PAGE> 1
EXHIBIT 1
PUT AGREEMENT
This PUT AGREEMENT ("Agreement") is made as of September 21, 1999
between and among WALT ANDERSON, WARREN FELDMAN, SOLOMON FELDMAN, REVISION LLC,
a Delaware limited liability company ("Revision"), and TOTAL-TEL USA
COMMUNICATIONS, INC., a New Jersey corporation (the "Company").
W I T N E S S E T H:
WHEREAS, Walt Anderson, Warren Feldman, Solomon Feldman and
Revision each is a stockholder of the Company; and
WHEREAS, Warren Feldman, Solomon Feldman, Walt Anderson, and
Revision each desires to enter into certain arrangements pursuant to which
Warren Feldman, Solomon Feldman and one or more of their respective Designees
(as defined below) will have the right (but not the obligation) to sell some or
all of their shares of Common Stock of the Company ("Common Stock") not to
exceed 1,103,817 shares of Common Stock in the aggregate to Revision, and
Revision will be obligated to purchase such shares of Common Stock from Warren
Feldman, Solomon Feldman, and their respective Designees (collectively, the "Put
Holders"), on the terms and subject to the conditions set forth herein; and
WHEREAS, to induce Warren Feldman to enter into the Separation
Agreement (as defined below), the Company is willing to pay the related legal
fees of its counsel relating to their participation in the preparation and
negotiation of this Agreement.
NOW, THEREFORE, in consideration of the above mentioned premises,
the mutual covenants and agreements contained herein, and other good and
valuable consideration the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINED TERMS
1.1 Defined Terms. The capitalized terms contained and used in this
Agreement which are defined below shall have the respective meanings ascribed to
them as follows:
(a) "Claims" shall have the meaning set forth in Section 5.1.
(b) "Closing" shall have the meaning set forth in Section 3.1.
(c) "Common Stock" shall have the meaning set forth in the
recitals above.
(d) "Company" shall have the meaning set forth in the recitals
above.
(e) "Designee" shall mean a person or entity who (i) is the
record or beneficial owner of Common Stock on the date hereof; (ii) if an
individual, is (A) a sibling, lineal ancestor or lineal descendant of Warren
Feldman or Solomon Feldman, (B) the spouse of a sibling, lineal ancestor or
lineal descendant of Warren Feldman or Solomon Feldman, or (C) the sibling (or
such sibling's spouse) of the spouse of Warren Feldman or Solomon Feldman; and
(iii) if a
<PAGE> 2
corporation, limited liability company, trust or partnership, is owned or
controlled by Warren Feldman or Solomon Feldman on the date hereof, and in each
case has been designated by Warren Feldman or Solomon Feldman to sell shares of
Common Stock pursuant to the Put Option in amounts to be determined by Warren
Feldman or Solomon Feldman and set forth in the Exercise Notice.
(f) "Exercise Notice" shall have the meaning set forth in
Section 2.1.
(g) "Exercise Period" shall mean the period beginning on
December 11, 1999 and ending at 5:00 p.m. on February 10, 2000.
(h) "Indemnified Liabilities" shall have the meaning set forth in
Section 5.1.
(i) "Indemnified Parties" shall have the meaning set forth in
Section 5.1.
(j) "Loss Notice" shall have the meaning set forth in Section
5.1.
(k) "Put Holders" shall have the meaning set forth in the
recitals above.
(l) "Put Option" shall have the meaning set forth in Section 2.2.
(m) "Revision" shall have the meaning set forth in the recitals
above.
(n) "Securities" shall have the meaning set forth in Section 2.1.
(o) "Securities Act" shall have the meaning set forth in Section
4.2.
(p) "Separation Agreement" shall mean that certain Separation
Agreement dated as of the date hereof between Warren Feldman and the Company.
(q) "Settlement Agreement" shall mean that certain Settlement
Agreement among the Company, Revision and Walt Anderson dated December 10, 1998.
1.2 Rules of Construction. The words "hereby", "herein", "hereunder,"
and words of similar import refer to this Agreement as a whole (including any
Exhibits and Schedules hereto) and not merely to the specific section, paragraph
or clause in which such word appears. The definitions given for terms in this
Agreement shall apply equally to both the singular and plural forms of the terms
defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine, and neuter forms. The conjunction "or" shall
be understood in its inclusive sense (and/or).
-2-
<PAGE> 3
ARTICLE II
PUT OPTION
2.1 Grant of Put Option. On one occasion during the Exercise Period,
each of the Put Holders shall have the right (but not the obligation) to sell to
Revision, and Revision shall be obligated to purchase from each such Put Holder,
up to an aggregate of 1,103,817 shares of Common Stock (the "Securities") at a
purchase price of $16 per share.
2.2 Manner of Exercise. To exercise the put option set forth in
Section 2.1 (the "Put Option"), Warren Feldman, acting for himself and as agent
for Solomon Feldman and, if so designated, one or more of their Designees, shall
deliver written notice thereof (the "Exercise Notice") to Revision at any time
during the Exercise Period. Such Exercise Notice shall (a) list each Put Holder
who will sell shares of Common Stock, (b) specify the number of shares to be
sold by each such Put Holder, (c) provide the account information (name of bank,
address of bank, ABA number and bank account number) to which the purchase price
payment for such Put Holder should be wired, (d) state the aggregate purchase
price for the Securities subject to the Exercise Notice and provide a breakdown
of the amounts to be received by each Put Holder, and (e) specify a suggested
date and time for the Closing. The Put Option shall automatically expire (to the
extent then unexercised) without any further action of the parties, and no party
shall have any further rights or obligations under this Agreement except as
provided in Section 6.3, upon the earlier of (i) the exercise of the Put Option
or (ii) the expiration of the Exercise Period without the exercise by Put
Holders of their rights under the Put Option.
ARTICLE III
CLOSING
3.1 Closing of the Purchase. The closing of any purchase of
Securities pursuant to exercise of the Put Option (the "Closing") shall be held
at the offices of Swidler Berlin Shereff Friedman, LLP, 3000 K Street, N.W.,
Washington, D.C., on the thirtieth business day after delivery of the Exercise
Notice, or on such later date as each of the conditions to Closing set forth in
Section 3.2 shall have been satisfied or waived by the party entitled to the
benefit thereof.
3.2 Conditions to Closing. It shall be a condition to the obligations
of the parties to purchase and sell Securities following the delivery of the
Exercise Notice that:
(a) Any waiting period (and any extension thereof) under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, applicable to
the purchase by Revision of the Securities shall have expired or been
terminated;
(b) The representations and warranties of the parties
contained in this Agreement shall have been true and complete when made, and
shall be true and complete on and as of the date of the Closing as though such
representations and warranties were made at and as of such date, except as
otherwise expressly contemplated herein; and
(c) Each of the parties to the Separation Agreement shall have
duly performed
-3-
<PAGE> 4
and complied in all material respects with all agreements, covenants and
conditions required to be performed or complied with by it under such Separation
Agreement.
3.3 Deliveries at Closing. At the Closing:
(a) Each Put Holder listed in the Exercise Notice shall
deliver to Revision one or more certificates representing the Securities duly
endorsed in blank or with stock power attached and signatures guaranteed;
(b) Each Put Holder listed in the Exercise Notice shall
deliver to Revision a signed statement, dated as of the date of the Closing,
pursuant to which such Put Holder represents and warrants to Revision that (i)
such Put Holder is the sole beneficial and record owner of all right, title, and
interest in and to the shares of Common Stock to be sold to Revision by the Put
Holder, (ii) such shares of Common Stock are free and clear of any security
interest, claims, liens, pledges, options, encumbrances, charges, agreements,
voting trusts, proxies, preemptive rights, or rights of first refusal or other
arrangements, restrictions, or legal or equitable limitations of any kind, and
(iii) upon the delivery of the stock certificates at the Closing, such Put
Holder will transfer good, valid, and marketable title to the shares of Common
Stock to Revision, free and clear of any security interests, claims, liens,
pledges, options, encumbrances, charges, agreements (other than those created by
the Settlement Agreement), voting trusts, proxies, preemptive rights or rights
of first refusal or other arrangements, restrictions or legal or equitable
limitations of any kind; and
(c) Revision simultaneously shall pay to each Put Holder
listed in the Exercise Notice the purchase price specified in such Exercise
Notice in immediately-available funds by wire transfer to the account or
accounts specified in the Exercise Notice.
3.4 Inability to Complete Purchase.
(a) If, at the time of the Closing, Revision is unable or
unwilling to pay any Put Holder the full purchase price for the Securities
subject to purchase from such Put Holder in accordance herewith for any reason
(other than as a consequence of the failure by such Put Holder to satisfy the
conditions precedent specified in Section 3.2), then, in addition to their other
remedies, (i) any Put Holder may elect to rescind the sale and retain the
Securities specified in the Exercise Notice; and (ii) Walt Anderson and Revision
shall each grant Warren Feldman an irrevocable proxy to vote all shares of
Common Stock held or owned by Walt Anderson and/or Revision or standing in the
name of Walt Anderson and/or Revision (the "Proxy Stock"), which proxy shall
include, without limitation, the right to attend all meeting of stockholders of
the Company and then and there vote all such shares of Proxy Stock for the
transaction of any and all business that may come before such meetings and any
adjournments thereof, and the right to represent and to vote all shares of Proxy
Stock according to the number of votes that Walt Anderson and/or Revision would
be entitled to cast if personally present.
(b) The proxy set forth in this Section 3.4 shall terminate
automatically upon the payment in full by Revision of the purchase price for the
Securities subject to purchase from each Put Holder in accordance herewith.
-4-
<PAGE> 5
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 Certain Representations and Warranties by the Feldmans.
(a) Each of Warren Feldman and Solomon Feldman represents and
warrants, severally and not jointly, as of the date hereof and again on the date
of such Closing, that (i) this Agreement has been duly executed and delivered by
him and constitutes his legal, valid, and binding obligation, enforceable
against him in accordance with its terms, (ii) subject to the satisfaction of
the condition set forth in Section 3.2(a), the execution, delivery, and
performance by him of this Agreement will not violate any order, writ,
injunction, decree, statute, rule, or regulation applicable to him, (iii) that
each Put Holder will be the sole beneficial and record owner of all right,
title, and interest in and to number of shares of Common Stock specified in any
Exercise Notice executed by such Put Holder, and (iv) upon the delivery of the
stock certificates at the Closing, each Put Holder will transfer good, valid,
and marketable title to such shares of Common Stock to Revision, free and clear
of any security interests, claims, liens, pledges, options, encumbrances,
charges, agreements, voting trusts, proxies, preemptive rights or rights of
first refusal, or other arrangements, restrictions, or legal or equitable
limitations of any kind.
(b) Warren Feldman represents and warrants, as of the date
hereof and again on the date of the Closing, that he and his Designees are the
sole beneficial or record owners of all right, title, and interest in and to
855,879 shares of Common Stock, including 120,222 shares of Common Stock
issuable upon exercise of vested but unexercised options to purchase shares of
Common Stock.
(c) Solomon Feldman represents and warrants, as of the date
hereof and again on the date of the Closing, that he and his Designees are the
sole beneficial or record owners of all right, title, and interest in and to
247,938 shares of Common Stock.
4.2 Certain Representations and Warranties by Revision and Walt
Anderson.
(a) Revision represents and warrants, as of the date hereof
and again on the date of the Closing, that (i) the execution, delivery, and
performance by Revision of this Agreement has been duly authorized by all action
required by law, its certificate of formation, and operating agreement, (ii)
this Agreement has been duly executed and delivered by Revision and constitutes
a legal, valid, and binding obligation of Revision, enforceable against it in
accordance with its terms, (iii) the execution, delivery, and performance by
Revision of this Agreement will not conflict with or result in any breach of any
provision of the certificate of formation and operating agreement of Revision,
(iv) the execution, delivery, and performance by Revision of this Agreement will
not result in a violation or breach of, or constitute (with or without due
notice or lapse of time or both) a default (or give rise to any right of
termination, amendment, cancellation, or acceleration) under, any of the terms,
conditions, or provisions of any note, bond, mortgage, indenture, lease,
license, contract, agreement, or other instrument or obligation to which
Revision is a party or by which any of its assets or properties may be bound,
(v) subject to the satisfaction of the condition set forth in Section 3.2(a),
the execution, delivery, and performance by Revision of this Agreement will not
violate any order, writ, injunction,
-5-
<PAGE> 6
decree, statute, rule, or regulation applicable to Revision or any of its
properties or assets, (vi) upon exercise of the Put Option, Revision will
acquire the Securities for its own account for investment and not with a view
to, or for sale in connection with, any public distribution thereof in violation
of the Securities Act of 1933, as amended (the "Securities Act"), (vii) Revision
is an Accredited Investor within the meaning ascribed to such term under
Regulation D of the rules and regulations promulgated under the Securities Act,
(viii) all shares of Common Stock owned by Revision are owned free and clear of
any voting trusts, proxies, preemptive rights or rights of first refusal (except
as provided in Section 3.4), and (ix) the net liquidation value of Revision's
assets is in excess of $20,000,000.
(b) Walt Anderson represents and warrants, as of the date
hereof and again on the date of the Closing, that (i) he has full authority to
execute and deliver this Agreement on his own behalf and on behalf of Revision,
(ii) this Agreement has been duly executed and delivered by him and constitutes
his legal, valid and binding obligation, enforceable against him in accordance
with its terms, and (iii) subject to the provisions of Section 3.2(a), the
execution, delivery, and performance by him of this Agreement will not violate
any order, writ, injunction, decree, statute, rule, or regulation applicable to
him.
ARTICLE V
COVENANTS AND UNDERTAKINGS
5.1 Indemnification.
(a) Revision shall indemnify, defend, and hold harmless Warren
Feldman, Solomon Feldman, and each of their respective Designees (the
"Indemnified Parties") against all losses, claims, damages, costs, expenses,
liabilities, or judgments or amounts (including reasonable attorneys' fees) that
are suffered or incurred by them in connection with any claim, action, suit,
proceeding, or investigation resulting from the purchase of shares of Common
Stock by Revision pursuant to this Agreement and the other transactions
contemplated herein and in the Separation Agreement except to the extent that
the same shall result from the gross negligence or intentional misconduct of any
Indemnified Party or from the breach by any Indemnified Party of any of its
representations, warranties, or covenants hereunder (collectively, the
"Indemnified Liabilities").
(b) If an Indemnified Party desires to claim indemnification
pursuant to this Agreement, upon learning of any such claim, action, suit,
proceeding, or investigation (collectively, "Claims"), he shall as promptly as
practicable notify Revision by written notice (a "Loss Notice") (but the failure
so to notify Revision shall not relieve it from any liability which it may have
under this Agreement except to the extent such failure prejudices Revision).
Revision shall have the option (i) to conduct any proceedings or negotiations in
connection with any such Claims, (ii) to take all other steps to settle or
defend any such Claim (provided that Revision shall not settle any such Claim
without the written consent of the Indemnified Parties, which consent shall not
be unreasonably withheld), and (iii) to employ counsel chosen by the Indemnified
Parties (but reasonably acceptable to Revision) to contest any such Claim in the
name of the Indemnified Parties or otherwise. In the event that a settlement
entails only the payment of money damages and includes the full and final
release of all Claims against all Indemnified Parties, no consent of the
Indemnified Parties shall be required for such settlement.
-6-
<PAGE> 7
In the event that a settlement entails only the payment of money damages by an
Indemnified Party, no consent of the Indemnified Parties shall be required for
settlement; provided that at the request of an Indemnified Party within five
days of notice to such Indemnified Party of a proposed cash settlement, Revision
shall pay the amount of the cash settlement to the Indemnified Party which
payment shall fully and finally discharge all obligations of Revision hereunder
with respect to the Indemnified Liabilities. In any event, an Indemnified Party
shall be entitled to participate at his own expense and by his own counsel in
any proceedings relating to any Claim.
(c) Revision shall, within twenty (20) days of receipt of the
Loss Notice, notify the Indemnified Parties of its intention to assume the
defense of such Claim. If (i) Revision shall decline to assume the defense of
any such Claim, (ii) Revision shall fail to notify the Indemnified Parties
within twenty (20) days after receipt of the Loss Notice of Revision's election
to defend such Claim, or (iii) the Indemnified Parties shall have reasonably
concluded that there may be defenses available to them which are different from
or in addition to those available to Revision or a conflict exists between
Revision, on the one hand, and the Indemnified Parties, on the other hand (in
which case Revision shall not have the right to direct the defense of such
action on behalf of the Indemnified Parties), the Indemnified Parties shall
defend against such Claim. The indemnification under this Agreement shall only
be available for a Claim or proceeding against the Indemnified Parties to the
extent that indemnification from the Company under any applicable director and
officer indemnification policies provided by the Company is insufficient or
unavailable.
(d) The indemnification obligations of Revision hereunder
shall apply only to Indemnified Liabilities arising from Claims as to which
notice has been provided to Revision by the Indemnified Parties within sixty
(60) days of receipt of such notice by the Indemnified Parties.
5.2 Other Covenants and Undertakings.
(a) Following the exercise of the Put Option, each party will
use his or its commercially reasonable efforts to obtain satisfaction of the
conditions set forth in Section 3.2.
(b) In the period beginning on the date hereof and ending on
the earlier of (i) the date all of the Securities owned by Warren Feldman,
Solomon Feldman and their Designees are acquired by Revision, or (ii) the date
of expiration of the Exercise Period, Revision shall not sell, pledge, mortgage,
encumber, or otherwise dispose of any shares of the Company's Common Stock.
(c) Walt Anderson shall cause Revision to perform and comply
in all material respects with all agreements, covenants, and conditions required
to be performed or complied with by it under this Agreement.
(d) At all times beginning on the date hereof and ending on
the earlier of (i) the date all of the shares of Common Stock owned by Warren
Feldman, Solomon Feldman and their Designees are acquired by Revision, or (ii)
the date of expiration of the Exercise Period, Revision shall maintain the net
liquidation value of its assets at or above $20,000,000. In the
-7-
<PAGE> 8
event that the net liquidation value of Revision's assets declines below
$20,000,000, Revision shall, within twenty-four (24) hours, so notify Warren
Feldman in writing.
(e) The parties hereby terminate each and every existing
agreement between or among the parties hereto relating to the voting of shares
of the Company's Common Stock, including without limitation the agreement set
forth in Section 3(b) of that certain Stock Purchase Agreement dated December
10, 1998 among Walt Anderson, Warren Feldman, Solomon Feldman and Revision (but
excluding the voting agreements contained in Section 3.4 hereof).
ARTICLE VI
GENERAL MATTERS
6.1 Notice. All communications provided for hereunder shall be
sent in writing and mailed by first class mail, return receipt requested, or
sent by overnight courier, or sent by facsimile transmission to the address
stated below or to such changed address as the addressee may have been given by
similar notice:
(a) If to Warren Feldman and/or Solomon Feldman:
102 West Hill Road
Woodcliff Lake, New Jersey 07675
Attn: Warren Feldman
Facsimile No.: (201) 573-0875
With a copy to:
1500 Palisade Avenue
Apt. 17A
Fort Lee, NJ 07024
Attn: Solomon Feldman
(b) If to Revision or Walt Anderson:
Walt Anderson
c/o Gold & Appel Tranfer, S.A.
1023 31st Street, 4th Floor
Washington, D.C. 20007
Facsimile No.: (202)736-5065
With a copy to:
Swidler Berlin Shereff Friedman, LLP
3000 K Street, N.W., Suite 300
Washington, D.C. 20007
Attn: Sean P. McGuinness
-8-
<PAGE> 9
Facsimile No. (202) 424-7643
Any such notice shall be deemed received, if mailed, five days after mailing,
one day after sending by overnight courier, or upon confirmation of transmission
if sent by facsimile transmission.
6.2 Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New Jersey, without giving effect to
its principles or rules of conflict of laws to the extent such principles or
rules would require or permit the application of the laws of another
jurisdiction.
6.3 Expenses. All costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be borne by the party
incurring such expenses; provided, however, that the Company shall pay fees and
expenses of Covington & Burling, its counsel, incurred in connection with the
preparation of this Agreement.
6.4 No Third-Party Beneficiaries. Nothing in this Agreement shall be
construed as giving any person or entity, other than the parties hereto, the
Designees and their successors and permitted assigns, any right, remedy, or
claim under or in respect of this Agreement or any provision hereof, except as
expressly provided herein.
6.5 Successors and Assigns; Severability. This Agreement shall be
binding upon the respective successors, heirs, trustees and permitted assigns of
the parties hereto. This Agreement shall not be assignable or otherwise
transferable by any party without the prior written consent of the other parties
and any attempt to so assign or transfer this Agreement without such consent
shall be void and of no effect. If any provision of this Agreement is held to be
unenforceable for any reason, it shall be adjusted rather than voided, if
possible, in order to achieve the intent of the parties to this Agreement to the
extent possible.
6.6 Counterparts; Amendments; Entire Agreement, Etc. This Agreement
and any amendments hereto may be executed in one or more counterparts, each of
which shall be an original, but all of which together shall constitute one
instrument. This Agreement may be changed, modified, amended or supplemented
only by written instrument signed by the parties hereto. No provision of this
Agreement may be waived orally, but only by a written instrument signed by the
party against whom enforcement of such waiver is sought. The headings in this
Agreement are inserted for convenience only and shall not constitute a part
hereof. This Agreement constitutes the entire agreement and understanding of the
parties with respect to its subject matter and supersedes all oral
communications and prior writings with respect thereto.
6.7 Termination Upon Rejection of Separation Agreement.
Notwithstanding any provision hereof to the contrary, if Warren Feldman shall
revoke the Separation Agreement pursuant to Section 10(h) thereof, this
Agreement shall thereupon terminate and shall be void and of no force and
effect.
-9-
<PAGE> 10
IN WITNESS WHEREOF, this Put Agreement has been executed and
delivered by the parties hereto on the date first above written.
REVISION LLC
By: /s/ Walt Anderson
-------------------------------
Name: Walt Anderson
Title: Manager
/s/ Walt Anderson
-------------------------------
Walt Anderson
/s/ Warren Feldman
----------------------------
Warren Feldman
/s/ Solomon Feldman
-------------------------------
Solomon Feldman
TOTAL-TEL USA COMMUNICATIONS, INC.
By: /s/ Dennis Spina
-------------------------------
Name: Dennis Spina
Title: President & Chief
Executive Officer
-10
<PAGE> 1
EXHIBIT 2
SEPARATION AGREEMENT
This SEPARATION AGREEMENT (this "Agreement") is made as of September
21, 1999 by and between WARREN H. FELDMAN, residing at 102 West Hill Road,
Woodcliff Lake, New Jersey 07675 ("Warren Feldman") and TOTAL-TEL USA
COMMUNICATIONS, INC., a New Jersey corporation with offices at 150 Clove Road,
Little Falls, New Jersey 07424 (the "Company").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Employment Agreement dated May 5,
1999 by and between Warren Feldman and the Company (the "Employment
Agreement"), Warren Feldman has agreed to serve as Chairman of the Board of the
Company until December 31, 2001, on the terms and subject to the conditions set
forth therein; and
WHEREAS, Warren Feldman and the Company desire to terminate the
Employment Agreement on the mutually beneficial terms set forth herein.
NOW, THEREFORE, in consideration of the above mentioned premises, the
mutual covenants and agreements contained herein, and other good and valuable
consideration the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. TERMINATION OF EMPLOYMENT AGREEMENT.
(a) Termination of Employment Agreement. Warren Feldman
and the Company agree that the Employment Agreement shall be terminated as of
5:00 p.m. on the Effective Date (as defined below), and shall have no further
force or effect, unless this Agreement is revoked by Warren Feldman on or prior
to such date pursuant to Section 10(h), in which case such termination of the
Employment Agreement shall not be effective.
(b) Resignation. Warren Feldman hereby resigns from the
office of Chairman of the Board and as a member of the Board of Directors of
the Company and from each position he holds at any subsidiary of the Company,
such resignations to be effective at 5:00 p.m. on October 7, 1999 (the
"Effective Date"), unless this Agreement is revoked by Warren Feldman on or
prior to such date pursuant to Section 10(h), in which case such resignations
shall not become effective and this Agreement shall be void and of no force and
effect. The Company hereby accepts the resignations of Warren Feldman as of
the Effective Date.
2. FELDMAN RELEASE OF CLAIMS.
(a) General Release. Warren Feldman agrees, on his own
behalf and on behalf of his heirs, successors, agents, executors,
administrators, and assigns (collectively, the "Feldman Releasors"), to release
the Company and its present and former subsidiaries, affiliates, divisions,
branches, agencies, and other offices and its and their respective present and
former
<PAGE> 2
successors, assigns, officers, agents, representatives, affiliates, attorneys,
fiduciaries, administrators, directors, stockholders, and employees
(collectively, the "Feldman Releasees") from any and all manner of actions,
causes of action, suits, judgments, executions, demands, debts, dues, duties,
accounts, bonds, agreements (other than those relating to the Options or as
otherwise provided herein), contracts, covenants, damages and all other claims
whatsoever, both in law and in equity, which the Feldman Releasors ever had,
now have or may in the future have against any or all of the Feldman Releasees
for or by reason of or in any way arising out of any cause, matter or thing
existing up to the Effective Date including, without limiting the generality of
the foregoing, for or by reason of or in any way arising out of any cause,
matter or thing relating to salary, wages, monies advanced, bonuses, expenses,
director's fees, retirement or pension allowances, participation in profits or
earnings or damages for wrongful dismissal (including but not limited to any
discrimination claim based on age, sex, race, religion, color, national origin,
disability, marital status, appearance or sexual orientation under federal,
state or local law, rule or regulation, and/or any claim for wrongful
termination, defamation, and any other claim, whether in tort, contract or
otherwise). This release shall not apply to any claims the Feldman Releasors
may have relating to the Company's performance of its obligations under this
Agreement.
(b) ADEA Release. The Feldman Releasors further agree
that they are hereby releasing any and all claims that they may have under the
Age Discrimination in Employment Act connected with Warren Feldman's employment
with the Company (or his separation therefrom) arising on or before the
Effective Date.
(c) Promise Not To Sue On Claims Released. The Feldman
Releasors promise not to initiate any court or judicial-type proceeding against
the Company that involves any claim that they have released in Sections 2(a)
and 2(b) of this Agreement. If a court determines that the Feldman Releasors
or any one of them have violated this release by suing the Company or any of
the Feldman Releasees they hereby agree that they will pay all costs and
expenses of defending against the suit incurred by the Company. Nothing in this
Section 2(c) shall be construed to prevent the Feldman Releasors or any one of
them from filing a charge of discrimination with, or participating in an
investigation or proceeding conducted by, the Equal Employment Opportunity
Commission.
(d) Consultation With an Attorney. Warren Feldman
acknowledges that he has been advised to consult his own attorney prior to
entering into this Agreement and that he was afforded sufficient time to
undertake such consultation.
3. COMPANY RELEASE OF CLAIMS.
(a) General Release. The Company agrees on its own
behalf and on behalf of its present and former subsidiaries, affiliates,
divisions, branches, agencies, and other offices and its and their respective
present and former successors, assigns, officers, agents, representatives,
affiliates, attorneys, fiduciaries, administrators, directors, stockholders,
and employees (collectively, the "Company Releasors"), to release Warren
Feldman and his heirs, successors, agents, executors, administrators, and
assigns (the "Company Releasees") from any and all manner of actions, causes of
action, suits, judgments, executions, demands, debts, dues, duties, accounts,
bonds, agreements (other than those provided herein), contracts, covenants,
- 2 -
<PAGE> 3
damages and all other claims whatsoever, both in law and in equity, which the
Company Releasors ever had, now have or may in the future have against any or
all of the Company Releasees for or by reason of or in any way arising out of
any cause, matter or thing existing up to the Effective Date. This release
shall not apply to any claims the Company Releasors may have relating to Warren
Feldman's performance of his obligations under this Agreement, or to any claim
for recovery by the Company of short-swing profits under Section 16(b) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
(b) Promise Not To Sue On Claims Released. The Company
Releasors promise not to initiate any court or judicial-type proceeding against
the Company Releasees that involves any claim that they have released in
Section 3(a) of this Agreement. If a court determines that the Company
Releasors or any one of them have violated this release by suing any of the
Company Releasees they hereby agree that they will pay all costs and expenses
of defending against the suit incurred by the Company Releasees.
4. CONSIDERATION.
(a) Severance Payment. In full satisfaction of all
amounts outstanding under the Employment Agreement and in consideration of the
promises set forth herein and other good and valuable consideration, the
Company agrees to pay to Warren Feldman severance pay in the lump-sum amount of
$650,000, which amount shall be payable promptly (but in any event not later
than three (3) business days) following the execution and delivery hereof.
(b) Existing Options. The Company acknowledges and
agrees that Warren Feldman has been granted non-statutory stock options to
purchase 120,222 shares of the Company's common stock ("Common Stock"), which
stock options (collectively, the "Options") are exercisable as follows:
(i) 39,222 from the grant of April 15, 1997 are
exercisable at $7.25, per share;
(ii) 33,000 from the grant of November 3, 1992 are
exercisable at $0.5114, per share; and
(iii) 48,000 from the grant of February 2, 1992 are
exercisable at $0.5114, per share.
(c) Exercise of Options. The Company acknowledges and
agrees that Warren Feldman shall have ninety (90) days from the Effective Date
to exercise the Options, approval by the Board of Directors of the Company of
this Agreement constituting the determination by the Board that such 90-day
period is reasonable and appropriate.
5. TAXES AND BENEFITS; WITHHOLDINGS. The parties acknowledge and
agree that (i) federal, state and local tax withholdings will be made from the
payments provided for in this Agreement as may be required by law and/or in
accordance with the Company's benefit plans, and (ii) Warren Feldman shall be
solely responsible for the federal, state, and local and other taxes normally
paid by employees relating to these payments.
- 3 -
<PAGE> 4
6. REPRESENTATIONS AND WARRANTIES.
(a) Certain Representations and Warranties by Warren
Feldman. Warren Feldman represents and warrants to the Company that (i) this
Agreement has been duly executed and delivered by him and constitutes his
legal, valid and binding obligation, enforceable against him in accordance with
its terms, (ii) the execution, delivery, and performance by Warren Feldman of
this Agreement will not result in a violation or breach of, or constitute (with
or without due notice or lapse of time or both) a default (or give rise to any
right of termination, amendment, cancellation or acceleration) under, any of
the terms, conditions or provisions of any note, bond, mortgage, indenture,
lease, license, contract, agreement or other instrument or obligation to which
Warren Feldman is a party or by which any of his assets or properties may be
bound, and (iii) the execution, delivery, and performance by him of this
Agreement will not violate any order, writ, injunction, decree, statute, rule,
or regulation applicable to him.
(b) Certain Representations and Warranties by the
Company. The Company represents and warrants to Warren Feldman that (i) the
execution, delivery, and performance by the Company of this Agreement have been
duly authorized by all action required by law, its certificate of incorporation
and bylaws, (ii) this Agreement has been duly executed and delivered by the
Company and constitutes a legal, valid, and binding obligation of the Company,
enforceable against it in accordance with its terms, (iii) the execution,
delivery, and performance by the Company of this Agreement will not conflict
with or result in any breach of any provision of the articles of incorporation
or bylaws of the Company, (iv) the execution, delivery, and performance by the
Company of this Agreement will not result in a violation or breach of, or
constitute (with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, amendment, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond, mortgage,
indenture, lease, license, contract, agreement or other instrument or
obligation to which the Company is a party or by which any of its assets or
properties may be bound, (v) the execution, delivery, and performance by the
Company of this Agreement will not violate any order, writ, injunction, decree,
statute, rule, or regulation applicable to the Company or any of its properties
or assets, and (vi) it has obtained directors and officers liability insurance
policies covering all officers and directors of the Company, and such policies
are in full force and effect on the date hereof.
7. NON-COMPETE, NON-DISPARAGEMENT AND CONFIDENTIAL INFORMATION.
(a) Company Business. Warren Feldman covenants and
agrees that he will not, during the period commencing on the Effective Date and
ending on the date twelve (12) months thereafter, directly or indirectly, in
any capacity, engage in or participate in the management, ownership, or
operation of any business or activity which directly competes with the business
conducted by the Company (as such business is conducted on the Effective Date)
in the States of New York and New Jersey.
(b) No Solicitation. Warren Feldman covenants and agrees
that he will not, during the period commencing on the Effective Date and ending
on the date twenty-four
- 4 -
<PAGE> 5
(24) months thereafter, directly or indirectly: (i) employ or solicit the
employment (or assist any third party to employ or solicit the employment) of
any person who was engaged by the Company as an employee on September 1, 1999
(provided that the foregoing prohibition shall not apply to his executive
assistant, or after October 7, 2000, to (A) any person whose employment is
involuntarily terminated by the Company or (B) any person who is not employed
by the Company at the time his employment is first solicited by Warren
Feldman); or (ii) call on any party that was a customer of the Company on the
Effective Date for the purpose of competing with the Company by soliciting,
diverting or taking away any customer of the Company (provided that after
October 7, 2000 the foregoing prohibition shall not apply to any customer from
which the Company has not billed or received a total of $10,000 in payments for
products or services during the six-month period prior to when such customer is
first solicited by Warren Feldman).
(c) Reasonable Restrictions. Warren Feldman recognizes
and hereby acknowledges that the restrictions imposed upon him in this Section
7 are reasonable and are necessary for the protection of the business of the
Company. It is understood and agreed that this Section 7 shall not be deemed
to be violated merely because Warren Feldman owns stock or other equity
interests in an entity that is in competition with the Company, so long as a
class of equity securities of such entity is registered pursuant to the
Exchange Act , and Warren Feldman owns no more than five percent (5%) of the
outstanding equity securities of such class.
(d) Non-Disparagement. Neither party to this Agreement
shall in any way attempt to disparage or impair the reputation or good name of
the other party, the Company's divisions, affiliates, or subsidiaries, or any
of the Company's officers, directors or employees.
(e) Confidential Information. Warren Feldman hereby
acknowledges that during the course of his employment with the Company he came
into contact with, and had access to, information that is the property of the
Company. Such information includes, but is not limited to, business plans,
present or prospective customers, vendors, products, processes services or
activities, including the costing and pricing of such services or activities.
Warren Feldman covenants and agrees that he has not and will not utilize or
disclose any of the above described confidential information to any person(s)
or entities for any reason or purpose whatsoever, except in the performance of
his duties for the Company. The foregoing limitations shall not apply to any
information that (i) is or becomes public knowledge through no action or
default on the part of Warren Feldman; (ii) is approved by the Company in
writing for disclosure to specified third parties; or (iii) is required to be
disclosed by Warren Feldman pursuant to a court order or applicable rules and
regulations.
(f) Rights and Remedies Upon Breach. In the event of any
breach or threatened breach by Warren Feldman of the covenants of Section 7,
the Company shall be entitled to such equitable and injunctive relief as may be
available to restrain Warren Feldman from the violation of the provisions
hereof. Nothing herein shall be construed as prohibiting the Company from
pursuing any other remedies available at law or in equity for such breach or
threatened breach.
(g) Severability of Covenants. If any court determines
that any of the
- 5 -
<PAGE> 6
covenants of this Section 7, or any part thereof, is invalid or unenforceable,
the remainder of the covenants shall not thereby be affected and shall be given
full effect, without regard to the invalid portions.
(h) The prohibitions of paragraphs (a) and (b) of this
Section 7 shall terminate at such time as any person or group (as such term is
defined by Section 13(d) of the Exchange Act) other than Revision LLC, Walt
Anderson, Gold & Appel Transfer, S.A. and their respective affiliates acquires
voting common stock of the Company in a purchase or transaction or in a series
of purchases or transactions, if immediately thereafter such person or group
has, or would have, beneficial ownership (as determined pursuant to Rule 13d-3
under the Exchange Act) of a majority of the voting power of the Company's then
outstanding voting equity securities.
8. INDEMNIFICATION.
(a) Right to Indemnification. If Warren Feldman is made
a party or is threatened to be made a party to any action, suit, or proceeding,
whether civil, criminal, administrative, or investigative, by reason of the
fact he was a director or officer of the Company or was serving at the request
of the Company as a director or officer of another corporation or of a
partnership, joint venture, trust, or other enterprise, he shall be indemnified
and held harmless by the Company to the fullest extent permitted by applicable
law against all expenses, liabilities and losses (including attorneys' fees,
judgments, fines, or penalties and amounts paid in settlement) reasonably
incurred or suffered by him in connection therewith, and such indemnification
shall continue after the Effective Date and shall inure to the benefit of
Warren Feldman's heirs, executors, and administrators.
(b) Right to Advancement of Expenses. The right to
indemnification conferred in this Section 8 shall include the right to be paid
by the Company the expenses incurred in defending any action, suit, or
proceeding in advance of its final disposition, subject to the receipt by the
Company of an undertaking by Warren Feldman to repay all amounts so advanced if
it shall ultimately be determined that he is not entitled to be indemnified.
(c) Nonexclusivity of Rights. The rights to
indemnification and to the advancement of expenses contained in this Section 8
shall not be exclusive of any other right which Warren Feldman may have or
hereafter acquire under any statute, provision of the Company's articles of
incorporation, by-laws, agreement, vote of stockholders or disinterested
directors, or otherwise.
(d) Duration. The indemnification obligations of the
Company hereunder shall apply only to indemnified liabilities arising from
claims as to which notice has been provided to the Company by Warren Feldman
within sixty (60) days of receipt of such notice by Warren Feldman.
(e) Indemnification Agreement. The parties hereto
acknowledge and agree that (i) the Indemnification Agreement dated March 6,
1998 between Warren Feldman and the Company (the "Indemnification Agreement")
is, and at all times since March 6, 1998 has been, in full force and effect,
(ii) that, notwithstanding the provisions of Section 1 of the
- 6 -
<PAGE> 7
Indemnification Agreement, Warren Feldman shall be entitled to the rights of
indemnification provided therein if at any time after the Effective Date, by
reason of his Corporate Status (as defined therein) he is, or is threatened to
be made, a party to any threatened, pending, or completed Proceeding (as
defined therein), and (iii) the Indemnification Agreement shall continue until
the expiration of the term set forth in Section 10 thereof.
9. OTHER COVENANTS AND UNDERTAKINGS.
(a) Insurance. The Company further covenants and agrees
that, for a period of three (3) years following the Effective Date, it will
maintain a directors and officers liability insurance policy covering Warren
Feldman for the period of his service as a director and officer of the Company
up to and including the Effective Date.
(b) Transition Issues. Warren Feldman shall return the
Company car currently in his possession on or before the date that is fifteen
(15) days after the Effective Date, and the Company shall maintain the existing
automobile insurance coverage on such car until such date. Warren Feldman
shall have the right to purchase (i) the cellular phone he currently uses, (ii)
the personal computer currently in his office, and (iii) the personal computer,
printer, fax machine and cellular phone currently used by his executive
assistant, each for a purchase price equal to the depreciated value of such
equipment; provided, however, that all Company-related information shall be
deleted from the two personal computers before they are sold to Warren Feldman.
(c) Press Releases. The Company shall provide a copy of
any press release or other public disclosure concerning the transactions
contemplated hereby to Warren Feldman, and any such press release or other
public disclosure shall not be disseminated or released without the prior
written approval of Warren Feldman, such approval not to be unreasonably
withheld or delayed.
10. GENERAL MATTERS.
(a) Notice. All communications provided for hereunder
shall be sent in writing and mailed by first class mail, return receipt
requested, or sent by overnight courier, or sent by facsimile transmission to
the address stated below or to such changed address as the addressee may have
been given by similar notice:
(i) If to Warren Feldman:
102 West Hill Road,
Woodcliff Lake, New Jersey 07675
Attn: Warren Feldman
Facsimile No.: (201) 573-0875
- 7 -
<PAGE> 8
with a copy (which shall not constitute notice) to:
1500 Palisade Avenue
Apt. 17A
Fort Lee, NJ 07024
Attn: Solomon Feldman
(ii) If to the Company:
Total-Tel USA Communications, Inc.
150 Clove Road
Little Falls, New Jersey 07424
Attn: President & Chief Executive Officer
Facsimile No.: (973) 785-5173
with a copy to:
Covington & Burling
1200 Pennsylvania Avenue, N.W.
Washington, D.C. 20044
Attn: Bobby R. Burchfield, Esq.
Facsimile No.: (202) 778-5350
Any such notice shall be deemed received, if mailed, five days after mailing,
one day after sending by overnight courier, or upon confirmation of
transmission if sent by facsimile transmission.
(b) Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New Jersey, without
giving effect to its principles or rules of conflict of laws to the extent such
principles or rules would require or permit the application of the laws of
another jurisdiction.
(c) Expenses. All costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby shall
be borne by the party incurring such expenses; provided, however, that the
Company shall pay the fees and expenses of Covington & Burling, counsel to the
Company, incurred in connection with the preparation of this Agreement.
(d) No Third-Party Beneficiaries. Except as provided in
Sections 2 and 8, nothing in this Agreement shall be construed as giving any
person or entity, other than the parties hereto and their successors and
permitted assigns, any right, remedy, or claim under or in respect of this
Agreement or any provision hereof, except as expressly provided herein.
(e) Successors and Assigns; Severability. This Agreement
shall be binding upon the respective successors, trustees, and permitted
assigns of the parties hereto. This Agreement shall not be assignable or
otherwise transferable by any party without the prior written consent of the
other parties and any attempt to so assign or transfer this Agreement
- 8 -
<PAGE> 9
without such consent shall be void and of no effect. If any provision of this
Agreement is held to be unenforceable for any reason, it shall be adjusted
rather than voided, if possible, in order to achieve the intent of the parties
to this Agreement to the extent possible.
(f) Counterparts; Amendments; Entire Agreement, Etc.
This Agreement and any amendments hereto may be executed in one or more
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument. This Agreement may be changed, modified,
amended, or supplemented only by written instrument signed by the parties
hereto. No provision of this Agreement may be waived orally, but only by a
written instrument signed by the party against whom enforcement of such waiver
is sought. The headings in this Agreement are inserted for convenience only
and shall not constitute a part hereof. As used herein, except as the context
otherwise indicates, the singular shall include the plural and vice versa and
words of any gender shall include any other gender. The conjunction "or" shall
be understood in its inclusive sense (and/or). This Agreement constitutes the
entire agreement and understanding of the parties with respect to its subject
matter and supersedes all oral communications and prior writings with respect
thereto.
(g) Period of Consideration. By his signature below,
Warren Feldman acknowledges that the Company complied with the ADEA by giving
him a period of at least twenty-one (21) days from the date that this Agreement
was first provided to him to consider this Agreement and to decide whether to
accept it. Warren Feldman further acknowledges that no representative of the
Company ever stated or implied that he had less than twenty-one (21) days to
consider this Agreement. Warren Feldman also acknowledges that, to the extent
he decided to sign this Agreement prior to the expiration of the full
twenty-one (21) day period, such decision was knowing and voluntary on his part
and was in no way coerced by the Company. To the extent any changes were made
in this Agreement as a result of negotiations taking place after the date this
Agreement was provided to Warren Feldman, he and the Company agree that such
changes, whether material or not, did not restart the running of the period of
twenty-one (21) days to consider this Agreement required by the ADEA.
(h) Right to Revoke Agreement. Except for the
obligations of the Company under Section 4(a), this Agreement will not become
effective or enforceable until October 7, 1999, which is more than seven (7)
days from the date first above written. During the period prior to such date,
Warren Feldman has a right to change his decision to accept the severance
payment that has been offered and paid to him and to revoke this Agreement, in
which case he shall be obligated to return such payment.
- 9 -
<PAGE> 10
IN WITNESS WHEREOF, this Separation Agreement has been executed and
delivered by the parties hereto on the date first above written.
TOTAL-TEL USA COMMUNICATIONS, INC.
for itself and for all its subsidiaries
By: /s/ Dennis Spina
---------------------------------------
Name: Dennis Spina
Title: President & Chief Executive Officer
/s/ Warren Feldman
---------------------------------------
Warren Feldman
- 10 -
<PAGE> 1
EXHIBIT 3
REVISION, LLC
September 21, 1999
Warren Feldman, Esq.
102 West Hill Road
Woodcliff Lake, New Jersey 07675
Re: Separation Agreement
Dear Warren:
Reference is made to that certain Separation Agreement (the "Separation
Agreement") between you and Total-Tel USA Communications, Inc. (the "Company")
dated as of the date hereof and to that certain Put Agreement (the "Put
Agreement") among you, Solomon Feldman, Revision LLC and the Company dated as
of the date hereof. Capitalized terms used herein without definition shall
have the meanings ascribed to them in the Separation Agreement.
In order to induce you to enter into the Separation Agreement and the
Put Agreement, and for other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, Revision LLC hereby irrevocably
agrees to pay you the sum of $250,000, which amount shall be payable promptly
(but in any event not later than three (3) business days) following the
execution and delivery the Separation Agreement.
The provisions of Section 10 of the Separation Agreement shall apply to
this letter agreement, mutatis mutandis.
If the foregoing accurately reflects our understanding on this matter,
please so indicate by acknowledging where indicated below and returning a
countersigned copy of this letter to us.
Very truly yours,
/s/ Walt Anderson
Walt Anderson
Manager
ACKNOWLEDGED AND AGREED:
/s/ Warren Feldman
- ---------------------
Warren Feldman
