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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
TELEGLOBE INC.
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(Name of Issuer)
COMMON SHARES 87941V10
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(Title of class of securities) (CUSIP number)
J. CHRISTOPHER DANCE, ESQ.
EXCEL COMMUNICATIONS, INC.
8750 NORTH CENTRAL EXPRESSWAY
SUITE 2000
DALLAS, TEXAS 75231
(214) 863-8000
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(Name, address and telephone number of person authorized to
receive notices and communications)
JUNE 14, 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
schedule because of Rule 13d-1(e), 13d-1(f) or 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 Rule 13d-7(b) for other
parties to whom copies are to be sent.
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, as amended (the "Exchange Act"), or otherwise subject to the liabilities
of that Section of the Exchange Act but shall be subject to all other provisions
of the Exchange Act.
(Continued on following page(s))
(Page 1 of 13 Pages)
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NYFS07...:\51\42351\0022\2037\SCH3028L.43E
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CUSIP No. 87941V10 13D Page 2 of 13
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1 NAME OF REPORTING PERSON: EXCEL COMMUNICATIONS, INC.
S.S. OR I.R.S. IDENTIFICATION NO. 75-2720091
OF ABOVE PERSON:
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (A) [_]
(B) [X]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS: NOT APPLICABLE
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED [_]
PURSUANT TO ITEM 2(d) OR 2(e):
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6 CITIZENSHIP OR PLACE OF DELAWARE
ORGANIZATION:
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NUMBER OF 7 SOLE VOTING POWER: 0 1
SHARES
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BENEFICIALLY 8 SHARED VOTING POWER: 54,830,338
OWNED BY
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EACH 9 SOLE DISPOSITIVE POWER: 0 1
REPORTING
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PERSON WITH 10 SHARED DISPOSITIVE POWER: 0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY 54,530,338 2
REPORTING PERSON:
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN [_]
SHARES:
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 42.2% 3
(APPROX.)
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14 TYPE OF REPORTING PERSON: CO
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1] If the option under the stock option agreement between EXCEL and the Issuer
described in this statement is exercised in full, EXCEL would beneficially own,
for purposes of Section 13(d) of the Securities Exchange Act of 1934, as
amended, 25,700,000 common shares of the capital stock of the Issuer subject to
such option, as to which it would have sole voting and sole dispositive power.
2] If the option described in footnote 1 is exercised in full, 25,700,000 common
shares of capital stock of the Issuer subject to such option would be added to
this number.
3] Based on 129,306,908 common shares of capital stock of the Issuer represented
by the Issuer to EXCEL to be outstanding as of June 14, 1998. If the option
described in footnote 1 is exercised in full, this percentage would be 52.0%
(based on an additional 25,700,000 common shares of capital stock of the Issuer
outstanding).
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Item 1. Security and Issuer.
This statement on Schedule 13D (the "Statement") relates to the
common shares of capital stock, (the "Common Shares") of Teleglobe Inc., a
corporation governed by the Canadian Business Corporations Act (the "Issuer").
The address of the Issuer's principal executive office is 1000 de La Gauchetiere
Street West, Montreal, Quebec, H3B 4X5.
Item 2. Identity and Background.
(a), (b), (c) and (f). This Statement is filed on behalf of EXCEL
Communications, Inc., a Delaware corporation ("EXCEL"). EXCEL is a provider of
long distance telecommunications and paging services in the United States. The
business address of EXCEL is 8750 North Central Expressway, Suite 2000, Dallas,
Texas 75231. The name, business address, present principal occupation or
employment and citizenship of each director and executive officer of EXCEL is
set forth on Appendix I hereto and incorporated herein by reference.
(d) and (e). During the past five years, neither EXCEL, nor to the
best of its knowledge, any of its directors and executive officers, has (i) been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors), or (ii) been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or a finding of any violation with respect to such laws.
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Item 3. Source and Amount of Funds or Other Consideration.
The Option (as defined and discussed in item 6 below)
was granted in consideration of EXCEL entering into the Merger Agreement (as
defined in item 4 below); EXCEL granted a reciprocal option to the Issuer in
consideration of the Issuer entering into the Merger Agreement. EXCEL did not
pay any cash consideration in respect of the Option and has not purchased any
Common Shares thereunder.
The proxies granted pursuant to the Voting Agreements (as defined
and discussed in item 6 below) were also granted in consideration of EXCEL
entering into the Merger Agreement.
Item 4. Purpose of Transaction.
On June 14, 1998, the Issuer, North Merger Sub Corporation, a
Delaware corporation and a wholly owned subsidiary of the Issuer ("Merger Sub"),
and EXCEL entered into an Agreement and Plan of Merger (the "Merger Agreement")
which provides that, following the satisfaction or waiver of the conditions set
forth therein, Merger Sub will merge with and into EXCEL, with EXCEL continuing
as the surviving corporation and a wholly owned subsidiary of the Issuer (the
"Merger"). Pursuant to the Merger, each share of EXCEL common stock, par value
$.001 per share, issued and outstanding immediately prior to the Merger will be
converted into .885 of a Common Share (rounded down to the
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nearest whole number) and cash in lieu of any fractional Common Shares.
The Merger is conditioned upon, among other things, (i) approval by
the stockholders of EXCEL of the Merger (which condition has been satisfied),
(ii) approval by the shareholders of the Issuer of an amendment to the Issuer's
articles of incorporation or by-laws to incorporate provisions restricting
certain actions by, and concerning the composition of, the Board of Directors of
the Issuer (the "Charter Amendment"), (iii) the effectiveness of the Issuer's
registration statement on Form F-4 to be filed with the Securities and Exchange
Commission, (iv) approval for listing of the Common Shares issuable or to be
reserved for issuance in the Merger on The New York Stock Exchange, Inc. (the
"NYSE"), subject to official notice of issuance, and the Montreal Exchange (the
"ME") and The Toronto Stock Exchange ("the "TSE"), subject to customary
requirements, (v) expiration or earlier termination of any waiting period
applicable to the Merger under the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended, and the Competition Act (Canada), (vi) the absence of any
law, government regulation or order opposing the Merger and (vii) receipt by the
Issuer and EXCEL of opinions of their counsel that the Merger will be treated
for federal income tax purposes as a reorganization within the meaning of
Section 368(a) of the Internal Revenue Code
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of 1986, as amended, that the Issuer, Merger Sub and EXCEL will each be a party
to the reorganization within the meaning of Section 368(b) of the Internal
Revenue Code of 1986, as amended, and that no gain or loss will be recognized by
EXCEL, Merger Sub or the Issuer as a result of the Merger.
As an inducement for EXCEL to enter into the Merger Agreement, the
Issuer and EXCEL entered into a Stock Option Agreement, dated as of June 14,
1998 (the "Stock Option Agreement"). Pursuant to the Stock Option Agreement, the
Issuer granted to EXCEL an irrevocable option (the "Option") to purchase up to
25,700,000 Common Shares at an exercise price of U.S. $25.812 per Common Share.
The Option may be exercised by EXCEL in whole or in part at any time or from
time to time following the termination of the Merger Agreement in circumstances
when a termination fee is payable thereunder and an Acquisition Proposal (as
defined in the Merger Agreement) is pending at the time of the termination.
The Stock Option Agreement also provides for the repurchase of the Common Shares
by the Issuer under certain circumstances.
In addition, as an additional inducement to EXCEL to enter into the
Merger Agreement, BCE Inc. ("BCE") and Telesystem, Telecom Ltd. ("Telesystem"),
shareholders of Teleglobe which, in the aggregate, hold approximately 42.4% of
the Common Shares as of June 14, 1998, each entered into a Consent and Voting
Agreement with Excel (collectively, the "Voting Agreements").
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Pursuant to the Voting Agreements, BCE and Telesystem severally
executed irrevocable written consents in lieu of a meeting of shareholders of
the Issuer approving the Merger Agreement and the Merger. In addition, such
shareholders of the Issuer agreed, that during the term of the Voting
Agreements, if requested by EXCEL, they would vote their shares (or execute
written consents) in favor of the issuance by the Issuer of Common Shares
pursuant to the Merger and in favor of the approval of the Charter Amendment at
any meeting of Teleglobe's shareholders, however called. In furtherance of the
foregoing agreements to vote, BCE and Telesystem severally granted to EXCEL
irrevocable proxies, and appointed certain officers of EXCEL as their
attorneys-in-fact, to vote their Common Shares in favor of approving the
issuance by Teleglobe of Common Shares pursuant to the Merger and in favor of
the Charter Amendment. As a result of the granting to EXCEL by BCE and
Telesystems of the irrevocable proxies, EXCEL may be deemed to share voting
power with respect to the Common Shares owned by BCE and Telesystem.
The foregoing descriptions of the Stock Option Agreement and the
Voting Agreements do not purport to be complete and are subject to all of the
terms and provisions of the Stock
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Option Agreement and the Voting Agreements, each incorporated by reference
herein.
Except as set forth above, EXCEL currently has no other plans or
intentions that could result in or relate to any of the transactions described
in subparagraph (a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer
(a) and (b). EXCEL, as grantee of the irrevocable proxies of BCE and
Telesystem under the Voting Agreements, may be deemed to beneficially own, for
purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), 54,530,338 Common Shares representing approximately 42.2%
of the outstanding Common Shares as of June 14, 1998.
Assuming the termination of the Merger Agreement in circumstances in
which the Merger Agreement is terminated when a termination fee is payable
thereunder and an Acquisition Proposal is pending at the time of termination,
upon exercise of the Option in full, EXCEL would have sole power to vote or to
direct the vote, and sole power to dispose or to direct the disposition, of
25,700,000 Common Shares subject to the Option. If the Option was exercised in
full, EXCEL would be the beneficial owner, for purposes of Section 13(d) of the
Exchange Act, of 80,530,338 Common Shares representing 52.0% of the outstanding
Common Shares as of June 14, 1998.
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The filing of this Statement shall not be construed as an admission
by EXCEL that it is for the purposes of Section 13(d) of the Exchange Act the
beneficial owner of such shares.
(c). No transactions in the Common Shares were effected by EXCEL
during the past 60 days, except as described herein.
(d). Not applicable.
(e). Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
Except for the Merger Agreement, the Stock Option Agreement and the
proxies granted pursuant to the Voting Agreements, neither EXCEL, nor to the
best of its knowledge, any other person named in Item 2 of this Statement
(except as described below in this Item 6) has any contract, arrangement,
understanding or relationship (legal or otherwise) with any person with respect
to any securities of the Issuer, including, but not limited to, transfer or
voting of any securities, finder's fees, joint ventures, loan or option
arrangements, puts or calls, guarantees of profits, division of profits or loss,
or the giving or withholding of proxies.
Certain persons named in Item 2 of this Statement may be entitled,
effective upon the consummation of the Merger, to certain demand registration
rights with respect to the Common Shares received by such persons pursuant to
the Merger. The Registration Rights Agreement relating to these rights is
incorporated by reference herein as Exhibit 5 hereto.
Item 7. Materials to Be Filed as Exhibits
The following exhibits are referenced herein and are incorporated by
reference from EXCEL's Current Report on Form 8-K filed with the Securities and
Exchange Commission on June 22, 1998:
1. Stock Option Agreement, dated as of June 14, 1998, among
Teleglobe Inc., North Merger Sub Corporation and EXCEL Communications, Inc.
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2. Agreement and Plan of Merger, dated as of June 14, 1998, among
Teleglobe Inc., North Merger Sub Corporation and EXCEL Communications, Inc.
3. Teleglobe Consent and Voting Agreement, dated as of June 14,
1998, between EXCEL Communications, Inc. and Telesystem Telecom Ltd.
4. Teleglobe Consent and Voting Agreement, dated as of June 14,
1998, between EXCEL Communications, Inc. and BCE Inc.
5. Form of Registration Rights Agreement to be entered into between
Teleglobe Inc. and the shareholders named therein.
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SIGNATURE
After reasonable inquiry and to the best of its knowledge and
belief, the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: June 24, 1998
EXCEL COMMUNICATIONS, INC.
By: /s/ J. Christopher Dance
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J. Christopher Dance
Executive Vice President,
Secretary and General Counsel
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APPENDIX I
The following table sets forth the name, business address, position
with EXCEL and principal occupation or employment and the name and principal
business of any corporation or other organization in which such employment is
conducted by each director and executive officer of EXCEL. The principal
business address of EXCEL is 8750 North Central Expressway, Suite 2000, Dallas,
Texas 75231 and, unless otherwise indicated, the business address of each person
listed below is the aforesaid address. All of the individuals listed below are
citizens of the United States.
Position With EXCEL;
Name and Principal Occupation or
Business Address Employment
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Kenny A. Troutt Chairman of the Board, President
and Chief Executive Officer.
Stephen R. Smith Executive Vice President of
Marketing-Emeritus and Director.
Stephen G. Canton President Commercial Sales
Division, Telco Communications
Group, Inc.
J. Christopher Dance Executive Vice President, Secretary
and General Counsel
Nicholas A. Merrick Executive Vice President and
Chief Financial Officer.
Ronald A. McDougall Director; President and Chief
Executive Officer of Brinker
International, Inc.
T. Allan McArtor Director; President and Chief
Executive Officer of Legend
Airlines, Inc.
Kenneth L. Hilton Executive Vice President,
Consumer Marketing.
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Lester M. Lichter Executive Vice President and
Chief Information Officer.
Thomas A. Marino Executive Vice President,
Network Operations.
Paul D. Fletcher Vice President and Treasurer.
Craig E. Holmes Vice President and Chief
Accounting Officer.
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