PAGE 1 OF 11
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
Shared Technologies Fairchild, Inc.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, par value $.004 per share
- --------------------------------------------------------------------------------
(Title of Class of Securities)
81948QAAS
- --------------------------------------------------------------------------------
(CUSIP Number)
Aloysius T. Lawn, IV
General Counsel and Secretary
Tel-Save Holdings, Inc.
6805 Route 202
New Hope, PA 18938
(215) 862-1500
- --------------------------------------------------------------------------------
(Name, Address, and Telephone Number of Person Authorized to
Receive Notices and Communications)
July 16, 1997
- --------------------------------------------------------------------------------
(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(b)(3) or (4), check the following box [ ].
(Continued on following pages)
Exhibit Index located on page 11
<PAGE>
PAGE 2 OF 11
- --------------------------------------------------------------------------------
1) NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Tel-Save Holdings, Inc. 23-2827736
- --------------------------------------------------------------------------------
2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [ ]
(b) [ X ]
- --------------------------------------------------------------------------------
3) SEC USE ONLY
- --------------------------------------------------------------------------------
4) SOURCE OF FUNDS WC
- --------------------------------------------------------------------------------
5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e) [ ]
- --------------------------------------------------------------------------------
6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware corporation
- --------------------------------------------------------------------------------
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
7) SOLE VOTING POWER
3,000,000 (Only upon exercise of Option. See Items 4 and 5.)
- --------------------------------------------------------------------------------
8) SHARED VOTING POWER N/A
- --------------------------------------------------------------------------------
9) SOLE DISPOSITIVE POWER
3,000,000 (Only upon exercise of Option. See Items 4 and 5.)
- --------------------------------------------------------------------------------
10) SHARED DISPOSITIVE POWER N/A
- --------------------------------------------------------------------------------
11) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,000,000
- --------------------------------------------------------------------------------
<PAGE>
PAGE 3 OF 11
- --------------------------------------------------------------------------------
12) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[ ]
- --------------------------------------------------------------------------------
13) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
15.9%
- --------------------------------------------------------------------------------
14) TYPE OF REPORTING PERSON CO
- --------------------------------------------------------------------------------
<PAGE>
PAGE 4 OF 11
ITEM 1. SECURITY AND ISSUER.
This statement on Schedule 13D (the "Statement"), filed with respect to
events that occurred on July 16, 1997, relates to shares of common stock, par
value $.004 per share (the "Issuer Common Stock"), of Shared Technologies
Fairchild, Inc., a Delaware corporation (the "Issuer"), whose principal
executive offices are located at 100 Great Meadow Road, Suite 104, Wethersfield,
Connecticut 06109.
ITEM 2. IDENTITY AND BACKGROUND.
This Statement is being filed by Tel-Save Holdings, Inc. (the "Reporting
Person"), a Delaware corporation. The Reporting Person provides long distance
services primarily to small and medium-sized businesses located throughout the
United States. The Reporting Person's long distance service offerings include
outbound service; inbound toll-free 800 service; and dedicated private line
services for data. The principal business and the principal executive offices of
the Reporting Person are located at 6805 Route 202, New Hope, Pennsylvania
18938.
The executive officers of the Reporting Person, as of July 16, 1997, are as
follows:
Name Business Address Office
Daniel Borislow Tel-Save Holdings, Inc. Chief Executive
6805 Route 202 Officer
New Hope, PA 18938
Gary W. McCulla Tel-Save Holdings, Inc. President and
6805 Route 202 Director of Sales
New Hope, PA 18938 and Marketing
Emanuel J. DeMaio Tel-Save Holdings, Inc. Chief Operations
6805 Route 202 Officer
New Hope, PA 18938
Joseph A. Schenk Tel-Save Holdings, Inc. Chief Financial
6805 Route 202 Officer, Treasurer
New Hope, PA 18938 and Director of
Investor Relations
Edward B. Meyercord, III Tel-Save Holdings, Inc. Executive Vice
6805 Route 202 President, Marketing
New Hope, PA 18938 and Corporate
Development
<PAGE>
PAGE 5 OF 11
Mary Kennon Tel-Save Holdings, Inc. Director of Customer
6805 Route 202 Care and Human
New Hope, PA 18938 Resources
Aloysius T. Lawn, IV Tel-Save Holdings, Inc. General Counsel and
6805 Route 202 Secretary
New Hope, PA 18938
Kevin R. Kelly Tel-Save Holdings, Inc. Controller
6805 Route 202
New Hope. PA 18938
The directors of the Reporting Person, as of July 16, 1997, are as follows:
Name and Principal
Business of Employer;
Name Principal Occupation Address
Daniel Borislow Chief Executive Officer Tel-Save Holdings, Inc.
of Tel-Save Holdings, Inc. 6805 Route 202
New Hope, PA 18938
Ronald R. Thoma Executive Vice President Crown Cork and Seal
of Crown Cork and Seal Company, Inc. (a manu-
Company, Inc. facturer of packaging
products)
9300 Ashton Road
Philadelphia, PA 19136
Gary W. McCulla President and Director of Tel-Save Holdings, Inc.
Sales and Marketing of 6805 Route 202
Tel-Save Holdings, Inc. New Hope, Pennsylvania 18938
George Farley Group Vice President of Twin County Grocers, Inc.
Finance/Chief Financial (a food distribution company)
Officer of Twin County 145 Talmadge Road
Grocers, Inc. Edison, New Jersey 08818
Harold First Financial Consultant 345 Park Avenue, 35th Floor
New York, NY 10154
<PAGE>
PAGE 6 OF 11
Emanuel J. DeMaio Chief Operations Officer Tel-Save Holdings, Inc.
of Tel-Save Holdings, Inc. 6805 Route 202
New Hope, Pennsylvania 18938
Joseph A. Schenk Chief Financial Officer, Tel-Save Holdings, Inc.
Treasurer and Director of 6805 Route 202
Investor Relations of New Hope, Pennsylvania 18938
Tel-Save Holdings, Inc.
Each person named above as an executive officer or director of the
Reporting Person is an American citizen.
During the five years prior to the date hereof, neither the Reporting
Person nor any of its executive officers and directors has been:
(i) convicted in a criminal proceeding; or
(ii) the subject of a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to,
federal or state securities laws or finding any violation with
respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Should the Option (as defined in Item 4 below) be exercised, the source of
funds that will be used to acquire the shares of Issuer Common Stock covered
thereby will be cash derived from the Reporting Person's general corporate
funds.
ITEM 4. PURPOSE OF TRANSACTION.
As of July 16, 1997, the Reporting Person, TSHCo, Inc. ("Merger Sub"), a
wholly owned subsidiary of the Reporting Person, and the Issuer entered into an
Agreement and Plan of Merger (the "Merger Agreement"), pursuant to which the
Issuer would, by merger with and into Merger Sub (the "Merger"), become a wholly
owned subsidiary of the Reporting Person and the shares of Issuer Common Stock
would be exchanged for shares of the Reporting Person's common stock.
Pursuant to the terms of the Merger Agreement, each share of Issuer Common
Stock will be converted into the number of shares of the Reporting Person's
common stock calculated by dividing $11.25 by the average closing price of the
Reporting Person's common stock over a 15-trading-day period prior to the
closing date of the Merger, provided that the exchange ratio shall not be
greater than 1.125 shares of the Reporting Person's common stock for a share of
Issuer Common Stock and that, if such average closing price is greater than $20
per share, the exchange ratio will be calculated
<PAGE>
PAGE 7 OF 11
by dividing the sum of (a) $11.25 plus the product of .3 times the amount by
which such average closing price exceeds $20 by (b) such average closing price.
The Issuer's convertible preferred stock will be exchanged for preferred stock
of the Reporting Person with substantially identical terms (for the Issuer's
Series C and D preferred stock) or for shares of the Reporting Person's common
stock (for the Issuer's Series I preferred stock).
The Issuer agrees in the Merger Agreement, among other matters, not to
solicit or initiate inquiries for the making of any proposal from or by other
parties with respect to a business combination with the Issuer or other like
transactions involving a change in control of the Issuer or substantial portions
of its assets or, except under certain circumstances, to engage in negotiations
with or provide information to another party in connection with such an inquiry
or proposal. Further, if the Merger Agreement is terminated under certain
circumstances, the Reporting Person will be entitled to be paid a $15,000,000
cash fee by the Issuer.
The consummation of the Merger is subject to the approval of the
stockholders of both the Reporting Person and the Issuer (including, in the case
of the Reporting Person, approval of an amendment to the Reporting Person's
certificate of incorporation to increase the number of the Reporting Person's
authorized shares of common stock), as well as other conditions, including
antitrust clearance, applicable federal and state regulatory approvals and
consents, the Merger's qualifying as a pooling of interests transaction for
accounting purposes and other customary closing conditions.
In connection with the Merger, stockholders of the Issuer holding
approximately 50% of the outstanding Issuer Common Stock entered into separate
agreements with the Reporting Person, under which such stockholders severally
agreed to vote their shares of Issuer Common Stock in favor of the Merger. Mr.
Daniel Borislow, Chairman and Chief Executive Officer of the Reporting Person,
also entered into an agreement with the Issuer under which he agreed to vote his
shares of the Reporting Person's common stock in favor of the Merger (the
several Issuer stockholders agreements and the Borislow agreement are
collectively referred to as the "Voting Agreements").
In addition, the Reporting Person entered into an Agreement with the Issuer
(the "STFI Agreement"), pursuant to which the Reporting Person would have the
right, if the Merger Agreement were to be terminated by the Issuer under certain
circumstances (a "Purchase Event", as defined in the STFI Agreement), to acquire
up to 3,000,000 shares of Issuer Common Stock from the Issuer for $11.25 per
share (the "Option"). The STFI Agreement expires on the earliest of (a)
consummation of the Merger, (b) January 31, 1998 and (c) termination of the
Merger Agreement other than pursuant to a Purchase Event. The terms and
conditions of the Option are more particularly set forth in the STFI Agreement.
Copies of the Merger Agreement, the Voting Agreements and the STFI
Agreement are filed as exhibits hereto and incorporated herein by this
reference. The foregoing summary is qualified in its entirety by reference to
such filed Agreements.
<PAGE>
PAGE 8 OF 11
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) The Reporting Person may be deemed to own beneficially 3,000,000
shares, or approximately 15.9%, of the Issuer Common Stock issued and
outstanding as of July 16, 1997 (adjusted to give effect to the exercise of the
Option).
No person named in Item 2 as an executive officer or director of the
Reporting Person beneficially owns any shares of the Issuer Common Stock.
(b) If the Option becomes exercisable and is exercised in accordance with
its terms, the Reporting Person will have sole power to vote and sole power to
dispose of such 3,000,000 shares of the Issuer Common Stock. Until the Option is
exercised, the Reporting Person has no rights of a stockholder with respect to
the shares of Issuer Common Stock subject to the Option, including no rights of
disposition or voting with respect to such shares.
The filing of this Statement does not constitute an admission by the
Reporting Person that it is the beneficial owner of any shares of the Issuer.
The Reporting Person is making this filing because of the possibility that it
may be deemed to be the beneficial owner of certain shares of the Issuer.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
Reference is hereby made to Item 4 hereof for a description of all
contracts, arrangements, understandings or relationships (legal or otherwise)
between the Reporting Person and any other person with respect to any securities
of the Issuer.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
7.1 Agreement and Plan of Merger, dated as of July 16, 1997, among
Tel-Save Holdings, Inc., TSHCo, Inc. and Shared Technologies
Fairchild, Inc. (incorporated by reference to Exhibit 2 to the
Reporting Person's Current Report on Form 8-K dated July 22, 1997).
7.2 Agreement, dated as of July 16, 1997, by and between Tel-Save
Holdings, Inc. and Shared Technologies Fairchild, Inc. (incorporated
by reference to Exhibit 10.1 to the Reporting Person's Current Report
on Form 8-K dated July 22, 1997).
7.3 Voting Agreement, entered into as of July 16, 1997, by and between
Daniel Borislow and Shared Technologies Fairchild, Inc. (incorporated
by reference to Exhibit 10.2 to the Reporting Person's Current Report
on Form 8-K dated July 22, 1997).
<PAGE>
PAGE 9 OF 11
7.4 Voting Agreement, entered into as of July 16, 1997, by and between RHI
Holdings, Inc. and Tel-Save Holdings, Inc. (incorporated by reference
to Exhibit 10.3 to the Reporting Person's Current Report on Form 8-K
dated July 22, 1997).
7.5 Voting Agreement, entered into as of July 16, 1997, by and between
Anthony D. Autorino and Tel-Save Holdings, Inc. (incorporated by
reference to Exhibit 10.4 to the Reporting Person's Current Report on
Form 8-K dated July 22, 1997).
7.6 Voting Agreement, entered into as of July 16, 1997, by and between
J.J. Cramer & Co. and Tel-Save Holdings, Inc. (incorporated by
reference to Exhibit 10.5 to the Reporting Person's Current Report on
Form 8-K dated July 22, 1997).
<PAGE>
PAGE 10 OF 11
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this Statement is true, complete and
correct.
TEL-SAVE HOLDINGS, INC.
By: /s/ Aloysius T. Lawn, IV
---------------------------
Aloysius T. Lawn, IV
General Counsel and
Secretary
Date: July 28, 1997
<PAGE>
PAGE 11 OF 11
EXHIBIT INDEX
<TABLE>
<CAPTION>
No. Description Page No.
- --- ------------ --------
<S> <C> <C>
7.1 Agreement and Plan of Merger, dated as of July 16, 1997, among Tel-Save 8*
Holdings, Inc., TSHCo, Inc. and Shared Technologies Fairchild, Inc.
(incorporated by reference to Exhibit 2 to the Reporting Person's Current
Report on Form 8-K dated July 22, 1997).
7.2 Agreement, dated as of July 16, 1997, by and between Tel-Save Holdings, 8*
Inc. and Shared Technologies Fairchild, Inc. (incorporated by reference to
Exhibit 10.1 to the Reporting Person's Current Report on Form 8-K dated
July 22, 1997).
7.3 Voting Agreement, entered into as of July 16, 1997, by and between Daniel 8*
Borislow and Shared Technologies Fairchild, Inc. (incorporated by reference
to Exhibit 10.2 to the Reporting Person's Current Report on Form 8-K dated
July 22, 1997).
7.4 Voting Agreement, entered into as of July 16, 1997, by and between RHI 9*
Holdings, Inc. and Tel-Save Holdings, Inc. (incorporated by reference to
Exhibit 10.3 to the Reporting Person's Current Report on Form 8-K dated
July 22, 1997).
7.5 Voting Agreement, entered into as of July 16, 1997, by and between Anthony 9*
D. Autorino and Tel-Save Holdings, Inc. (incorporated by reference to
Exhibit 10.4 to the Reporting Person's Current Report on Form 8-K dated
July 22, 1997).
7.5 Voting Agreement, entered into as of July 16, 1997, by and between J.J. 9*
Cramer & Co. and Tel-Save Holdings, Inc. (incorporated by reference to
Exhibit 10.5 to the Reporting Person's Current Report on Form 8-K dated
July 22, 1997).
* Page number where it is stated that the exhibit is incorporated by
reference.
</TABLE>
