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As filed with the Securities and Exchange Commission on April 10, 1996
SEC Registration No. 33-64589
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 3
TO
FORM S-3 REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
NETWORK LONG DISTANCE, INC.
(Exact Name of Registrant as Specified in Charter)
DELAWARE 72-1122018
(State or Other Jurisdiction (IRS Employer
of Incorporation) Identification No.)
525 Florida Street
Baton Rouge, Louisiana 70801
(504) 343-3125
(Address and Telephone Number of Registrant's Principal
Executive Offices and Principal Place of Business)
Marc I. Becker, Chairman of the Board
525 Florida Street
Baton Rouge, Louisiana 70801
(504) 343-3125
(Name, Address and Telephone Number of Agent for Service)
Copies to:
John B. Wills, Esq.
410 Seventeenth Street, Suite 1940
Denver, Colorado 80202
(303) 628-0747
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. / /
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities
Act of 1933, check the following box. /X/
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==============================================================================================
Title of Each Amount Proposed Maximum Proposed Maximum Amount of
Class of Securities to be Offering Price Aggregate Offering Registration
to be Registered Registered (1) Price Per Share Price (2) Fee
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
$.0001 Par Value 25,252 $10.00 Per $252,520 $87.08
Common Stock Shares Share
==============================================================================================
</TABLE>
(1) All securities subject to this Registration Statement are on behalf of
selling shareholders (see "Selling Shareholders").
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 by reference to the last sale reported on the
NASDAQ National Market System on October 22, 1995.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until the Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
The Exhibit Index appears on page II-6 of the sequentially numbered pages of
this Registration Statement. This Registration Statement, including
exhibits, contains 25 pages.
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NETWORK LONG DISTANCE, INC.
Cross-Reference Sheet pursuant to Item 501(b) of Regulation S-K between
Registration Statement (Form S-3) and Form of Prospectus.
Item Number and Caption Location in Prospectus
----------------------- ----------------------
1. Forepart of the Registration Cover Page; Inside Front
Statement and Outside Front Cover Pages
Cover Page of Prospectus
2. Inside Front and Outside Back Inside Front Cover Pages
3. Summary Information, Risk Prospectus Summary; Risk
Factors and Ratio of Earnings Factors
to Fixed Charges
4. Use of Proceeds Not Applicable
5. Determination of Offering Price Cover Page; Plan of Distribution
6. Dilution Not Applicable
7. Selling Security Holders Selling Shareholders
8. Plan of Distribution Plan of Distribution
9. Description of Securities to Not Applicable
be Registered
10. Interest of Named Experts Not Applicable
and Counsel
11. Material Changes Recent Developments
12. Incorporation of Certain Incorporation of Certain
Information by Reference Documents by Reference
13. Disclosure of Commission Part II, Item 17
Position on Indemnification
for Securities Act Liabilities
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall there be any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such State.
<PAGE>
SUBJECT TO COMPLETION -- DATED APRIL 10, 1996
PROSPECTUS
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NETWORK LONG DISTANCE, INC.
25,252 SHARES COMMON STOCK
($.0001 PAR VALUE)
All of the shares of Network Long Distance, Inc. (the "Company") Common
Stock are being registered on behalf of security holders ("Selling
Shareholders"), which are offering for sale 25,252 shares of the Company's
Common Stock which are presently outstanding. The Selling Shareholders are
not restricted in the price or prices at which they may sell their shares and
sales of such shares may depress the market price of the Company's Common
Stock. (See "Selling Shareholders".)
This offering is not being underwritten. The shares will be offered and
sold by the Selling Shareholders from time to time at prices to be determined
at the time of such sales.
It is anticipated that sales of the 25,252 shares of Common Stock being
offered hereby when made, will be made through customary brokerage channels
either through broker-dealers acting as agents or brokers for the Selling
Shareholders, or through broker-dealers acting as principals who may then
resell the shares in the over-the-counter market or otherwise, or at private
sales in the over-the-counter market or otherwise, at negotiated prices
related to prevailing market prices at the time of the sales or by a
combination of such methods of offering. Thus, the period of distribution of
such shares may occur over an extended period of time. The Selling
Shareholders will pay or assume brokerage commissions or discounts incurred
in the sale of their shares.
The Company is paying all of the expenses of registering the Common
Stock under the Securities Act of 1933, as amended, estimated to be $7,500
for filing, printing, legal, accounting and miscellaneous expenses in
connection with the offering.
On April 9, 1996, the closing sale price of the Company's Common Stock
as reported on the NASDAQ Small-Cap-SM- System was $9.25.
-----------------
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK. (SEE "RISK FACTORS".)
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
-----------------
The date of this Prospectus is April , 1996.
<PAGE>
No dealer, salesman or other person has been authorized to give any
information or to make any representations other than those contained or
incorporated by reference in this Prospectus in connection with the offer
contained in this Prospectus, and, if given or made, such other information
or representations must not be relied upon as having been authorized by the
Company or the Selling Stockholders. Neither the delivery of this Prospectus
nor any sale made hereunder shall, under any circumstances, create an
implication that there has been no change in the affairs of the Company since
the date hereof.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), and, in
accordance therewith, files reports, proxy statements and other information
with the Commission. Such reports, proxy statements and other information
can be inspected and copied at the public reference facilities maintained by
the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549, Room 1024 and at the following Regional Offices of the Commission:
Everett McKinley Dirksen Building, 219 South Dearborn Street, Chicago,
Illinois 60604, Room 1204, and Jacob K. Javits Building, 75 Park Place, 14th
Floor, New York, New York 10007. Copies of such material also can be
obtained at prescribed rates by writing to the Commission, Public Reference
Section, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
The Company's Common Stock is quoted on NASDAQ, and financial reports, proxy
statements and other information concerning the Company may be inspected at
the National Association of Securities Dealers, Inc., Washington, D.C.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, all which were previously filed with the
Commission, are hereby incorporated by reference in this Prospectus:
1. The Company's Annual Report on Form 10-K for the year ended March 31, 1995.
2. The Company's report on Form 10-Q for the three and six months ended
June 30, 1995 and September 30, 1995.
3. The Company's report on Form 8-K dated October 31, 1995.
4. The Company's amended reports on Form 8-K A/One dated December 27, 1995.
5. The Company's report on Form 8-K dated January 16, 1996.
6. The Company's report on Form 10-Q for nine months ended December 31, 1995.
7. The Company's report on Form 8-K A/One dated March 7, 1996.
8. The Company's report on Form 8-K A/Two dated April 3, 1996.
All documents filed by the Company prior to the date of this Prospectus
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the 1934 Act prior to the
termination of the offering of the shares of Common Stock shall be deemed to
be incorporated by reference in this Prospectus and to be a part hereof from
the date of filing of those documents.
Any statement contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus
to the extent that such statement is modified or replaced by a statement
contained in this Prospectus or in any other subsequently filed document that
also is or is deemed to be incorporated by reference into this Prospectus.
Any such statement so modified or superseded shall not be deemed, except as
so modified or replaced, to constitute a part of this Prospectus. The
Company undertakes to provide without
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charge to each person to whom a copy of this Prospectus has been delivered,
upon the written or oral request of any such person, including any beneficial
owner, a copy of any or all of the documents referred to above that have been
or may be incorporated in this Prospectus by reference, other than exhibits
to such documents. Written or oral requests for such copies should be
directed to Marc I. Becker, Chairman, Network Long Distance, Inc., 525
Florida Street, Baton Rouge, Louisiana 70801, (504) 343-3125.
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TABLE OF CONTENTS
AVAILABLE INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . .2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE. . . . . . . . . . . . . .2
PROSPECTUS SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
RECENT DEVELOPMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . .9
SELLING SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . 10
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . 10
EXPERTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
LEGAL OPINIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
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PROSPECTUS SUMMARY
The following summary is qualified in its entirety by, and should be
read in conjunction with, the more detailed information appearing elsewhere
in this Prospectus.
THE COMPANY
Network Long Distance, Inc. ("Network" or the "Company"), is a Delaware
corporation organized on December 9, 1987. Network maintains its principal
executive offices at 525 Florida Street, Baton Rouge, Louisiana 70801, and
its telephone number is (504) 343-3125.
Network is a long distance telecommunications company which provides
long distance and telecommunication services for resellers of the Company's
services to end-users ("switchless reseller division"), turnkey long distance
services for master agents of the Company's services sold to end-users
("agent division") and long distance services for retail customers ("retail
division").
The Company provides long distance services to businesses and
residences. The Company transmits long distance telephone calls through and
over various types of transmission circuits leased from other
telecommunications carriers at fixed or variable rates. Calls can be routed
through the Company's switching center, which selects the least expensive
among the various available transmission alternatives to complete the call.
Calls can also be completed by various underlying carriers and the Company
provides billing, customer service and other features relative to the call.
Based on the comparison of the Company's tariffed rate per minute as
compared to other long distance competitors, the Company believes its rates
for long distance services to be below those charged by AT&T, MCI and Sprint
and are competitive or below rates charged by other interexchange carriers.
The Company obtained this information from published Federal Communication
Commission Tariff schedules.
Profits are based on the Company's ability to charge rates in excess of
the Company's cost of transmitting calls over the transmission lines selected
by the switching equipment or in excess of underlying carrier costs.
The Company is a provider of long distance services throughout most of
the United States. The Company offers a variety of value added features and
options designed to attract long distance customers. The Company primarily
charges customers on the basis of minutes of usage at rates that vary with
the time of day of the call.
The Company's goal is to establish itself as a second-level long
distance telecommunications company. The long distance industry is dominated
by the four largest long distance providers namely AT&T, MCI, World Com, Inc.
and Sprint, with revenues over $1 billion. The second level, the Company's
goal, is comprised of companies under $1 billion but in excess of $100
million in annual revenues. The Company will attempt to achieve this goal
through its planned acquisition of other long distance companies, increased
call volumes and the addition of new services for its customers.
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The Company has two subsidiaries, M.M. Ross, Inc. and Network Advanced
Services, Inc. All references to the Company include its subsidiaries and its
subsidiaries prior operations, except as stated otherwise.
THE OFFERING
Securities Offered 25,252 Shares of Common Stock, $.0001 par
value per share.
Offering Price All or part of the Shares offered hereby may
be sold from time to time in amounts and on
terms to be determined by the Selling
Shareholders at the time of the sale.
NASDAQ Symbol "NTWK"
6
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RISK FACTORS
Prospective purchasers of the Company's Common Stock should carefully
consider, together with the other information herein, the following:
DEPENDANCE ON PRIMARY CARRIER AND THE AVAILABILITY OF TRANSMISSION FACILITIES
NOT ASSURED
The Company's long distance telephone business is dependent upon lease
or resale arrangements with fiber-optic and digital microwave carriers for
the transmission of calls. The future profitability of the Company is based
upon its ability to transmit long distance telephone calls over transmission
facilities leased from others on a cost-effective basis. The Company is
currently dependent on one primary carrier, Allnet Communications Services,
Inc. and leases transmission facilities on one to three year contracts. The
Company's contract with Allnet Communications Services, Inc. expires in June
1997 and automatically continues until either party elects to terminate after
ninety days written notice. The Company utilizes other fiber optic carriers
to a lesser extent to supplement communication transport services, however,
there can be no assurance that in the future the Company will continue to
have access, on an ongoing basis, to transmission facilities at favorable
rates.
ADVERSE EFFECT OF SERVICE INTERRUPTIONS
The Company's business requires that transmission and switching
facilities and other equipment be operational 24 hours per day, 365 days per
year. Long distance telephone companies, including the Company, have on
occasion and may in the future experience temporary service interruptions or
equipment failures, in some cases resulting from causes beyond their control.
Any such event experienced by the Company would impair the Company's ability
to service its customers and could have a material adverse effect on the
Company's business.
COMPETITION FROM OTHER LONG DISTANCE CARRIERS AND NEW COMPANIES
The long distance telecommunications industry is intensely competitive
and is significantly affected by the introduction of new services and the
market activities of industry participants. Competition in the long distance
business is based upon pricing, transmission quality, customer service, cost
of underlying facilities and to a lesser extent, value-added services. The
Company is characterized as a level three long distance company with revenues
of less than $100 million a year. As a result, it competes with AT&T, MCI,
World Com, Inc. and Sprint, which comprise level one, and other national and
regional long distance carriers which comprise level two and other level
three long distance companies. Some of the Company's competitors have
greater name recognition, more extensive transmission networks and greater
engineering and marketing capabilities than the Company and have, or have
access to, substantially greater financial and personnel resources than those
available to the Company. Various regulatory factors can also have an impact
on the Company's ability to compete. For example, AT&T, which is the
Company's largest competitor, has achieved greater flexibility over the
years, allowing it to price its services more aggressively. The ability of
the Company to compete effectively in the telecommunications industry on all
levels will depend upon its continued ability to provide high quality,
market-driven services at prices generally similar to,
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or less than, those charged by its competitors. There can be no assurance
that the Company will be able to compete successfully with existing or future
companies.
The long distance telecommunications industry and the Company have
potential new competitors entering with new or add on technology. Cable
systems, satellite transmission companies and personal communication systems
(PCS), may offer long distance communication services, as well as, video,
data and interactive media services.
CHANGES IN GOVERNMENT REGULATION OF LONG DISTANCE COMPANIES
In February 1996, the federal government passed the Telcom Legislation.
The legislation has far reaching impact on the entire telecommunications
industry and the long distance services offered by the Company. The legislation
will now open to competition the long distance market by allowing the seven
regional Bell operating companies into the long distance market after meeting
certain conditions imposed by the FCC. The Company believes competition will
substantially increase and this competition may lower prices for long distance
services to the Company's customers.
It is impossible for the Company at this point to predict the impact of
the telecommunications bill on the Company's business and prospects. The
Company believes that entry of the "baby bells" under such conditions as
outlined in the new legislation represents an opportunity for additional
products to market to the long distance consumer and that the Company's
established nationwide marketing capabilities would be a benefit to any long
distance carrier seeking to improve its market share. The Company also believes
the telecommunications act will create new opportunities for resale in the
local markets.
ADVERSE EFFECT OF RAPID TECHNOLOGICAL CHANGES AND SERVICE
The telecommunications industry has been characterized by rapid
technological change, frequent new service introductions and evolving
industry standards. The Company believes that its future success will depend
on its ability to anticipate such changes, and to offer on a timely basis
services that meet these evolving industry standards. There can be no
assurance that the Company will have sufficient resources to make the
investments necessary to acquire new technology or to introduce new services
that would satisfy an expanded range of customer needs.
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DEPENDENCE ON MANAGEMENT FOR SUCCESSFUL OPERATIONS AND CONTINUED GROWTH
Continued growth and expansion of the Company depends on continued
active participation of Michael Ross and Marc Becker, the current Officers
and Directors of the Company. The Company has employment agreements with
Mr. Ross and Mr. Becker which commenced on January 1, 1994 and terminate
December 31, 1997, however these agreements do not contain non-compete
provisions. The Company currently has "key-man" insurance on its Officers.
The cost of the "key-man" insurance is currently paid from operating
revenues and in the future, will be paid from operating revenues. The
loss of the services of either of these individuals could adversely affect
the continuation and future development of the Company's business.
Messrs. Ross and Becker devote 100% of their time to the business of the
Company.
DIVIDEND POLICY
The Company has paid no cash dividends on its Common Stock and has no
present intention of paying cash dividends in the foreseeable future. It is
the present policy of the board of Directors to retain all earnings to
provide for the growth of the Company. Payment of cash dividends in the
future will depend, among other things, upon the company's future earnings,
requirements for capital improvements, the operating and financial conditions
of the Company and other factors deemed relevant by the Board of Directors.
EXPANSION POLICY
The Company is committed to an expansion policy of acquiring other long
distance and telecommunications companies for cash and the Company's common
stock. The Company may be required to raise additional capital and continue
to issue common stock to facilitate its expansion policy. There can be no
assurance that funding will be available and as the Company issues its common
stock for cash or in connection with an acquisition, existing shareholders
will face dilution of their existing investment in the Company.
RECENT DEVELOPMENTS
On October 31, 1995, the Registrant acquired all or substantially all of
the assets and assumed certain liabilities of Value Tel, Inc. of Naperville,
Illinois ("Value Tel"). These assets consist of certain of Value Tel's long
distance customer accounts and associated accounts receivable as of October
31, 1995. The customer accounts which were purchased include retail customer
contracts, applications for service, applications for credit, customer lists,
databases, mailing lists and billing information.
The Registrant purchased the Value Tel assets for approximately
1,085,000 shares of the Company;s common stock. The purchase price was valued
at approximately $12,000,000. The purchase price was based upon a multiple
of the dollar amount of Value Tel's monthly revenue and accounts receivable
subject to future adjustments for variations in Value Tel's billings over the
next six (6) months. Certain Registrant's shares issued to Value Tel will be
held in escrow subject to the future adjustments based on a customer
evaluation at the end of the valuation period. The purchase price is
approximately equal to the market price of the shares as shown on NASDAQ on
the day prior to the Closing.
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Value Tel and certain of its Officers and Directors executed five (5)
year non-competition agreements with the Registrant and a six month service
agreement subject to month to month extensions to provide billing/customer
services and use of the Value Tel name.
On January 1, 1996, the Registrant acquired the selected assets of
Quantum Communications, Inc., a California corporation ("Quantum"). These
assets consist of approximately 40% of Quantum's long distance customer
accounts and accounts receivables; Quantum's rights under any agreements,
term contracts and letters of agency related to the customer accounts;
customer and other deposits held or made by the Registrant related to the
customer accounts and all dialers, T-1's and other equipment currently used
by or for the customer accounts.
The Registrant purchased the Quantum assets for approximately 51,526
shares of the Registrant's restricted Common Stock, $474,225 in cash, and
$339,570 paid in the form of equally denominated promissory notes payable at
the per annum rate of eight percent (8%) in sixty equal consecutive monthly
installments, the first of which shall be due on February 1, 1996, the
purchase price was valued at approximately $1,323,150. The purchase price was
based upon a multiple of Quantum's monthly revenue and accounts receivable
subject to future adjustments for variations in Quantum's billings on or
before February 28, 1996. Certain of the Registrant's shares and cash issued
to Quantum will be held in escrow subject to future adjustments based on a
customer evaluation to be conducted by the parties on or before February 28,
1996.
Registrant believes the acquisition of the Value Tel and Quantum assets
to be beneficial as it will allow for the consolidation and reduction in
overhead costs while increasing overall revenues from operations. Registrant
also believes the acquisitions will enhance its corporate image in areas
of the country in which it has had limited operations and may provide
additional acquisition opportunities.
There exists no material relationship between the Registrant, its
officers and directors and Value Tel or Quantum and their officers, directors
or affiliates. The restricted common stock used by the Registrant to
purchase the assets of Value Tel and Quantum were from the Registrant s
authorized but unissued common stock.
SELLING SHAREHOLDERS
All of the securities offered hereby are to be offered for the account
of the security holders set forth below ("Selling Shareholders").
<TABLE>
<CAPTION>
Shares Beneficially Shares Beneficially
Owned Prior to Owned
Name Offering After Offering
- ----------------------------------- -------- --------------
<S> <C> <C>
Benjamin Bronston 5,417 (1) --
Colorado River Communications Corp. 19,835 (2) --
</TABLE>
_________________
(1) Shares of restricted common stock issued by the Company for services
rendered.
(2) Shares of restricted common stock issued by the Company for assets
acquired.
PLAN OF DISTRIBUTION
The Selling Shareholders are not restricted as to the prices at which
they may sell their shares and sales of such shares at less than the market
price may depress the market price of the Company's Common Stock. Further,
the Selling Shareholders are not restricted as to the number of shares which
may be sold at any one time, and it is possible that a significant number of
shares could be sold at the same time which may also have a depressive
effective on the market price of the Company's Common Stock. However, it is
anticipated that the sale of the Common Stock being offered hereby will be
made through customary brokerage channels either through broker-dealers
acting as agents or brokers for the seller, or through broker-dealers acting
as principals, who may then resell the shares in the over-the-counter market,
or a private sale in the over-the-counter market or otherwise, at negotiated
prices related to prevailing market prices and customary brokerage
commissions at the time of the sales, or by a combination of such methods.
Thus, the period for sale of such shares by the Selling Shareholders may
occur over an extended period of time.
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There are no contractual arrangements between or among any of the
Selling Shareholders and the Company with regard to the sale of the shares
and no professional underwriter in its capacity as such will be acting for
the Selling Shareholders.
EXPERTS
The financial statements and schedules of the Company incorporated by
reference in this prospectus and elsewhere in the registration statement, to
the extent and for the periods indicated in their reports, have been audited
by Arthur Andersen LLP, independent public accountants, and are included
herein in reliance upon the authority of said firm as experts in accounting
and auditing in giving said reports.
The financial statements and schedules of the Company incorporated by
reference in this prospectus and elsewhere in the registration statement, to
the extent and for the periods indicated in their reports, have been audited
by Faulk and Winkler, independent public accountants, and are included herein
in reliance upon the authority of said firm as experts in accounting and
auditing in giving said reports.
The financial statements and schedules of Value Tel incorporated by
reference in this prospectus and elsewhere in the registration statement, to
the extent and for the periods indicated in their reports, have been audited
by Schultz, Chez and Jesser, LLP, independent public accountants, and are
included herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said reports.
LEGAL OPINIONS
The legality of the Shares offered hereby will be passed upon for the
Company by John B. Wills, Attorney At Law.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses of the offering, all of which are to be born by
the Registrant, are as follows:
SEC Filing Fee. . . . . . . . . . . . . . . $ 87.08
Printing Expenses . . . . . . . . . . . . . 500.00*
Accounting Fees and Expenses. . . . . . . . 2,000.00*
Legal Fees and Expenses . . . . . . . . . . 4,500.00*
Miscellaneous . . . . . . . . . . . . . . . 412.92*
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Total . . . . . . . . . . . . . . . . . $7,500.00
=========
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*Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
1) Section 145 of the General Corporation Law of Delaware provides:
"(a) A corporation shall have power to indemnify any person
who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation) by reason of
the fact that he is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonable incurred by him
in connection with such action, suit or proceeding if he acted in
good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to
believe his conduct was unlawful. The termination of any action,
suit or proceeding by judgment, order, settlement, conviction, or
upon a plea of NOLO CONTENDERE, shall not, of itself, create a
presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the
best interests of the corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that
his conduct was unlawful.
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(b) A corporation shall have power to indemnify any person
who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right
of the corporation to procure a judgment in its favor by reason of
the fact that he is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and
reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in
a manner he reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification
shall be made in respect of any claim, issue or matter as to which
such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem
proper.
(c) To the extent that a director, officer, employee or agent
of a corporation has been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in
subsections (a) and (b), or in defense of any claim, issue or
matter therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(d) Any indemnification under subsections (a) and (b) (unless
ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that
indemnification of the director, officer, employee or agent is
proper in the circumstances because he has met the applicable
standard of conduct set forth in subsections (a) and (b). Such
determination shall be made (1) by the board of directors by a
majority vote of a quorum consisting of directors who were not
parties to such action, suit or proceeding, or (2) if such a quorum
is not obtainable, or, even if obtainable a quorum of disinterested
directors so directs, by independent legal counsel in a written
opinion, or (3) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an
officer or director in defending any civil, criminal,
administrative, or investigative action, suit or proceeding may be
paid by the corporation in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking by or on
behalf of such director or officer to repay such amount if it shall
ultimately be determined that he is not entitled to be indemnified
by the corporation as authorized in this Section. Such expenses
(including attorneys' fees) incurred by other employees and agents
may be so paid upon such terms and conditions, if any, as the board
of directors deems appropriate.
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<PAGE>
(f) The indemnification and advancement of expenses provided
by, or grated pursuant to, the other subsections of this section
shall not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses my be entitled
under any by-law, agreement, vote of stockholders or disinterested
directors or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office.
(g) A corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust
or other enterprise against any liability asserted against him and
incurred by him in any such capacity, or arising out of his status
as such, whether or not the corporation would have the power to
indemnify him against such liability under the provisions of this
section.
(h) For purposes of this Section, references to "the
corporation" shall include, in addition to the resulting
corporation, any constituent corporation (including any constituent
of a constituent) absorbed in a consolidation or merger which, if
its separate existence had continued, would have had power and
authority to indemnify its directors, officers, and employees or
agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a
director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand
in the same position under the provisions of this Section with
respect to the resulting or surviving corporation as he would have
with respect to such constituent corporation if its separate
existence had continued.
(i) For purposes of this Section, references to "other
enterprises": shall include employee benefit plans; references to
"fines" shall include any excise taxes assessed on a person with
respect to an employee benefit plan; and references to "serving at
the request of the corporation" shall include any service as a
director, officer, employee or agent of the corporation which
imposes duties on, or involves services by, such director, officer,
employee, or agent with respect to an employee benefit plan, its
participants, or beneficiaries; and a person who acted in good
faith and in a manner he reasonably believed to be in the interest
of the participants and beneficiaries of an employee benefit plan
shall be deemed to have acted in a manner "not opposed to the best
interests of the corporation": as referred to in this Section.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this section shall, unless otherwise
provided when authorized or ratified, continue as to a person who
has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of
such a person."
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<PAGE>
2) Article IX of the Company's Articles of Incorporation provide as follows:
ARTICLE IX
INDEMNIFICATION OF OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS
(a) The corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of the corporation)
by reason of the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the corporation,
and, with respect to any criminal action or proceeding, had no reasonable
cause to believe his conduct was unlawful. The termination of any action,
suit or proceeding by judgment, order, settlement, conviction, or upon a plea
of NOLO CONTENDERE or its equivalent, shall not, or itself, create a
presumption that the person did not act in good faith and in a manner which
he reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(b) The corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a
judgment in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and reasonably incurred
by him in connection with the defense or settlement of such action or suit if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter at to
which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the Court of Chancery or the court in
which such action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem proper.
(c) To the extent that a director, officer, employee or agent of the
corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b), or in
defense of any claim, issue or matter therein, he shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred
by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) (unless ordered
by a court) shall be made by the corporation only as authorized in the
specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because
II-4
<PAGE>
he has met the applicable standard of conduct set forth in subsections (a)
and (b). Such determination shall be made (1) by the board of directors by a
majority vote of a quorum consisting of directors who were not parties to
such action, suit or proceeding, or (2) if such a quorum is not obtainable,
or, even if obtainable a quorum or disinterested directors so directs, by
independent legal counsel in a written opinion, or (3) by the stockholders.
(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative, or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount
if it shall ultimately be determined that he is not entitled to be
indemnified by the corporation as authorized in this Section. Such expenses
(including attorneys' fees) incurred by other employees and agents may be so
paid upon such terms and conditions, if any, as the board of directors deems
appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any by-law, agreement, vote
of stockholders of disinterested directors or otherwise, both as to action in
his official capacity and as to action in another capacity while holding such
office.
(g) The corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or agent
of the corporation, or is or was serving at the request of the corporation as
a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted
against him and incurred by him in any such capacity, or arising out of his
status as such, whether or not the corporation would have the power to
indemnify him against such liability under the provisions of this section.
(h) For purposes of this Section, references to "the corporation" shall
include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, and
employees or agents, so that any person who is or was a director, officer,
employee or agent of such constituent corporation, or is or was serving at
the request of such constituent corporation as a director, officer, employee
or agent of another corporation partnership, joint venture, trust or other
enterprise, shall stand in the same position under the provisions of this
Section with respect to the resulting or surviving corporation as he would
have with respect to such constituent corporation if its separate existence
had continued.
(i) For purposes of this Section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on a person with respect to an employee benefit plan;
and references to "serving at the request of the corporation" shall include
any service as a director, officer, employee or agent of the corporation
which imposes duties on, or involves services by, such director, officer,
employee, or agent with respect to an employee benefit plan, its
participants, or beneficiaries; and a person who acted in good faith and in a
manner he reasonably believed to be in the interest of the
II-5
<PAGE>
participants and beneficiaries of an employee benefit plan shall be deemed to
have acted in a manner "not opposed to the best interests of the corporation"
as referred to in this Section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
ITEM 16. EXHIBITS.
The following Exhibits are filed as part of this Registration Statement
pursuant to Item 601 of Regulation S-K:
Exhibit No. Title
- ----------- -----
5 Opinion of John B. Wills, Attorney at Law, regarding the
legality of the securities being registered dated
November 21, 1995.*
23.1 Consent of John B. Wills, Attorney at Law, dated
November 21, 1995.*
23.2 Consent of Arthur Andersen LLP, Independent Public
Accountants, dated November 21, 1995.*
23.3 Consent of Faulk & Winkler LLC, Independent Public
Accountants, dated November 21, 1995.*
23.4 Consent of Arthur Andersen LLP, Independent Public
Accountants, dated February 14, 1996.*
23.5 Consent of Faulk & Winkler LLC, Independent Public
Accountants, dated February 14, 1996.*
23.6 Consent of Schultz, Chez and Jesser, LLP, Independent
Public Accountants, dated February 14, 1996.*
23.7 Consent of Arthur Andersen LLP, Independent Public
Accountants, dated March 6, 1996.*
23.8 Consent of Faulk & Winkler LLC, Independent Public
Accountants, dated March 6, 1996.*
23.9 Consent of Schultz, Chez and Jesser, LLP, Independent Public
Accountants, dated March 6, 1996.*
23.10 Consent of Arthur Andersen LLP, Independent Public
Accountants, dated April 10, 1996.
23.11 Consent of Faulk & Winkler LLC, Independent Public
Accountants, dated April 10, 1996.
23.12 Consent of Schultz, Chez and Jesser, LLP, Independent
Public Accountants, dated April 10, 1996.
________________
*Previously filed
ITEM 17. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
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<PAGE>
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant of Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Baton Rouge, State of Louisiana on April 9,
1996.
NETWORK LONG DISTANCE, INC.
Date: April 9, 1996 By: /s/ Michael M. Ross
--------------------------------
Michael M. Ross, President
and Chief Executive Officer
Date: April 9, 1996 By: /s/ Marc I. Becker
--------------------------------
Marc I. Becker, Vice President,
Secretary, Principal Financial Officer
and Principal Accounting Officer
SIGNATURE DATE
- --------- ----
/s/ Michael M. Ross April 9, 1996
- ------------------------------ --------------------------------
Michael M. Ross
/s/ Marc I. Becker April 9, 1996
- ------------------------------ --------------------------------
Marc I. Becker
/s/ Joseph M. Edelman April 9, 1996
- ------------------------------ --------------------------------
Joseph M. Edelman
/s/ Leon L. Nowalsky April 9, 1996
- ------------------------------ --------------------------------
Leon L. Nowalsky
/s/ Russell J. Page April 9, 1996
- ------------------------------ --------------------------------
Russell J. Page
/s/ Tim Sledz April 9, 1996
- ------------------------------ --------------------------------
Tim Sledz
II-8
<PAGE>
NETWORK LONG DISTANCE, INC.
FORM S-3 REGISTRATION STATEMENT
EXHIBIT INDEX
Exhibit Number
in Registration Sequentially
Statement Description Numbered Pages
--------- ----------- --------------
5 Opinion of John B. Wills,
Attorney at Law dated November 21, 1995*
23.1 Consent of John B. Wills,
Attorney at Law dated November 21, 1995*
23.2 Consent of Arthur Andersen LLP,
Independent Public Accountants,
dated November 21, 1995*
23.3 Consent of Faulk and Winkler LLC,
Independent Public Accountants,
dated November 21, 1995*
23.4 Consent of Arthur Andersen LLP,
Independent Public Accountants,
dated February 14, 1996*
23.5 Consent of Faulk & Winkler LLC,
Independent Public Accountants,
dated February 14, 1996*
23.6 Consent of Schultz, Chez and Jesser, LLP,
Independent Public Accountants,
dated February 14, 1996.*
23.7 Consent of Arthur Andersen LLP,
Independent Public Accountants,
dated March 6, 1996*
23.8 Consent of Faulk & Winkler LLC,
Independent Public Accountants,
dated March 6, 1996*
23.9 Consent of Schultz, Chez and Jesser, LLP,
Independent Public Accountants,
dated March 6, 1996.*
23.10 Consent of Arthur Andersen LLP,
Independent Public Accountants,
dated April 10, 1996
23.11 Consent of Faulk & Winkler LLC,
Independent Public Accountants,
dated April 10, 1996
23.12 Consent of Schultz, Chez and Jesser, LLP,
Independent Public Accountants,
dated April 10, 1996.
_________________
*Previously filed
<PAGE>
EXHIBIT 23.10
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report
dated June 2, 1995 included in Network Long Distance, Inc.'s Form 10-K for
the year ended March 31, 1995 and to all references to our Firm included in
this registration statement.
/s/ ARTHUR ANDERSEN LLP
---------------------------
Arthur Andersen LLP
Jackson, Mississippi,
April 10, 1996.
<PAGE>
EXHIBIT 23.11
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in the registration statement of our report
dated June 3, 1994, included in Network Long Distance, Inc.'s Form 10-K for
the year ended March 31, 1995, and to all references to our Firm included
in this registration statement.
/s/ FAULK & WINKLER, LLC
-------------------------
FAULK & WINKLER, LLC
Baton Rouge, Louisiana
April 10, 1996
<PAGE>
EXHIBIT 23.12
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in the registration statement of our report
dated December 11, 1995, included in Network Long Distance, Inc.'s
Form 8-K A/One dated December 27, 1995, and to all references to our
Firm included in this registration statement.
/s/ SCHULTZ, CHEZ AND JESSER, LLP
---------------------------------
SCHULTZ, CHEZ AND JESSER, LLP
Chicago, Illinois
April 10, 1996
