<PAGE>
As filed with the Securities and
Exchange Commission on May 24, 1996
Registration No. 333-_________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------------
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
------------------------------------
Tel-Save Holdings, Inc.
(Exact name of registrant as specified in its charter)
Delaware 23-2827736
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
22 Village Square
New Hope, Pennsylvania 18938
(Address of Principal (Zip Code)
Executive Offices)
OPTION AGREEMENTS
FOR DANIEL BORISLOW, GARY W. McCULLA, EMANUEL J. DeMAIO,
PETER K. MORRISON, JOSEPH M. MORENA, MARY KENNON,
JACKIE COOKE, JR., JEFFREY EARHART, DAVID GROSS AND GREGORY LUFF
(Full title of the plan)
Aloysius T. Lawn, IV
General Counsel and Secretary
Tel-Save Holdings, Inc.
22 Village Square
New Hope, Pennsylvania 18938
(215) 862-1500
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
------------------------------------
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
Proposed
Title of Maximum Proposed
Securities Amount Offering Aggregate Amount of
To Be To Be Price Per Offering Registration
Registered Registered Share* Price* Fee
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 1,245,900 $17.50 $1,501,790 $517.86
$.01 par Shares
value
- -----------------------------------------------------------------------------------------------------------------
<FN>
* The shares of Common Stock may be acquired upon the exercise of options at
prices ranging from $.63 to $17.50 per share. Pursuant to Rule 457(h)(1), the
aggregate offering price is computed on the basis of the price at which the
options may be exercised.
</FN>
</TABLE>
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
----------------------------------------
The following documents filed by Tel-Save Holdings, Inc. ("Company" or
"Registrant") with the Securities and Exchange Commission ("Commission") are
hereby incorporated herein by reference:
(a) the Company's annual report on Form 10-K for the year ended
December 31, 1995;
(b) the Company's quarterly report on Form 10-Q for the quarter
ended March 31, 1996; and
(c) the description of the Company's Common Stock contained in the
Company's registration statement pursuant to Section 12(g) of
the Securities Exchange Act of 1934, as amended, on Form 8-A,
filed on September 8, 1995.
All documents filed by the Company after the date of this registration
statement pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act,
prior to the filing of a post-effective amendment which indicates that all of
the Company's Common Stock offered hereby has been sold or which withdraws from
registration such Common Stock then remaining unsold, shall be deemed to be
incorporated in this registration statement by reference and be a part hereof
from the date of filing such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference in this registration
statement shall be deemed to be modified or superseded for purposes of this
registration statement to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be incorporated
by reference in this registration statement modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or so superseded, to constitute a part of this
registration statement.
<PAGE>
Item 4. Description of Securities.
--------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
---------------------------------------
Not applicable.
Item 6. Indemnification of Directors and Officers.
------------------------------------------
The Delaware General Corporation Law provides, in substance, that
Delaware corporations shall have the power, under specified circumstances, to
indemnify their directors, officers, employees and agents in connection with
actions or suits by or in the right of the corporation, by reason of the fact
that they were or are such directors, officers, employees and agents, against
expenses (including attorneys' fees) and, in the case of actions, suits or
proceedings brought by third parties, against judgments, fines and amounts paid
in settlement actually and reasonably incurred in any such action, suit or
proceeding.
The Registrant's Bylaws also provide for indemnification to the fullest
extent permitted by the Delaware General Corporation Law. Reference is made to
the Bylaws of the Registrant.
As permitted by the Delaware General Corporation Law, the Registrant's
Bylaws eliminate the personal liability of its directors to the Registrant and
its stockholders, in certain circumstances, for monetary damages arising from a
breach of the director's duty of care. Additionally, the Registrant has entered
into indemnification agreements with some of its directors and officers. These
agreements provide for indemnification to the fullest extent permitted by law
and, in certain respects, may provide greater protection than that specifically
provided for by the Delaware General Corporation Law. The agreements do not
provide indemnification for, among other things, conduct that is adjudged to be
fraud, deliberate dishonesty or willful misconduct.
Item 7. Exemption from Registration Claimed.
------------------------------------
Not applicable.
II-2
<PAGE>
Item 8. Exhibits.
---------
Exhibit No. Description
- ----------- -----------
Exhibit 3.1 Amended and Restated Certificate of Incorporation, as amended,
of Tel-Save Holdings, Inc. (Incorporated herein by reference
to Exhibit 3.1 to the Company's Registration Statement on Form
S-1(File No. 33-94940)).
Exhibit 3.2 Amendment to Amended and Restated Certificate of Incorporation
of Tel-Save Holdings, Inc. (Incorporated by reference to
Exhibit 3.3 to the Company's Registration Statement on Form
S-1(File No. 333-2738)).
Exhibit 3.3 Bylaws of Tel-Save Holdings, Inc. (Incorporated herein by
reference to Exhibit 3.2 to Amendment No. 1 to the Company's
Registration Statement on Form S-1(File No. 33-94940)).
Exhibit 4.1 Form of Non-Qualified Stock Option of Tel-Save, Inc. Filed
herewith.
Exhibit 4.2 Form of Assumption of Tel-Save Holdings, Inc. relating to
Non-Qualified Stock Options of Tel-Save, Inc. Filed herewith.
Exhibit 4.3 Non-Qualified Stock Option for Joseph Morena. Filed herewith.
Exhibit 5 Opinion of Aloysius T. Lawn, IV, General Counsel and Secretary
of Tel-Save Holdings, Inc. with respect to the validity of the
Common Stock being registered. Filed herewith.
Exhibit 23.1 Consent of BDO Seidman, LLP, certified public accountants.
Filed herewith.
Exhibit 23.2 Consent of Aloysius T. Lawn, IV (included in Exhibit 5).
Exhibit 24 Powers of attorney of the directors and certain officers of
the Company. Included in the signature pages of the
Registration Statement at pages II-6, II-7.
II-3
<PAGE>
Item 9. Undertakings.
-------------
The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are being
made, a post-effective amendment to the registration
statement;
(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.
Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the
total dollar value of securities offered would not
exceed that which was registered) and any deviation
from the low or high and of the estimated maximum
offer range may be reflected in the form of
prospectus filed with the Commission pursuant to rule
424(b) if, in the aggregate, the changes in volume
and price represent no more than 20% change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the
effective registration statement; and
(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;
provided, however, that paragraphs (i) and (ii) do not apply
if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports
filed with or furnished to the Commission by the registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference 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 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;
II-4
<PAGE>
4. That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the registrant's annual
report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this
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.
5. 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.
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-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the Township of Solebury, County of Bucks, Commonwealth of
Pennsylvania, on the 24th day May, 1996.
TEL-SAVE HOLDINGS, INC.
By: /s/ Daniel Borislow
---------------------------
Daniel Borislow
Chairman of the Board,
Chief Executive
Officer and Director
II-5
<PAGE>
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below hereby constitutes and appoints Daniel Borislow, Aloysisus T.
Lawn, IV, and Catherine Collins McCoy, his true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him and in his
name, place, and stead, in any and all capacities, to sign any and all
amendments to this registration statement, and to file the same, with exhibits
thereto, and other documents in connection therewith with the Securities and
Exchange Commission, granting unto said attorney-in-fact and agent full power
and authority to do and perform each and every act and thing requisite and
necessary to be done, as fully to all and intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent or either of them, or their or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on May 24, 1996.
Signature Title
- --------- -----
/s/ Daniel Borislow
- ---------------------- Chairman of the Board,
Daniel Borislow Chief Executive Officer
and Director (Principal
Executive Officer
/s/ Gary W. McCulla President and Director
- ----------------------
Gary W. McCulla
/s/ Emanuel J. DeMaio
- ---------------------- Chief Operations Officer
Emanuel J. DeMaio and Director
/s/ Harold First Director
- ----------------------
Harold First
/s/ Ronald R. Thoma Director
- ----------------------
Ronald R. Thoma
/s/ Joseph A. Schenk
- ---------------------- Chief Financial Officer
Joseph A. Schenk and Treasurer and Director
(Principal Financial Officer)
/s/ Kevin R. Kelly
- ---------------------- Controller (Principal
Kevin R. Kelly Accounting Officer)
II-6
<PAGE>
INDEX OF EXHIBITS
Exhibit No. Description
- ----------- -----------
Exhibit 3.1 Amended and Restated Certificate of Incorporation, as amended,
of Tel-Save Holdings, Inc. (Incorporated herein by reference
to Exhibit 3.1 to the Company's Registration Statement on Form
S-1(File No. 33-94940)).
Exhibit 3.2 Amendment to Amended and Restated Certificate of Incorporation
of Tel-Save Holdings, Inc. (Incorporated by reference to
Exhibit 3.3 to the Company's Registration Statement on Form
S-1(File No. 333-2738)).
Exhibit 3.3 Bylaws of Tel-Save Holdings, Inc. (Incorporated herein by
reference to Exhibit 3.2 to Amendment No. 1 to the Company's
Registration Statement on Form S-1(File No. 33-94940)).
Exhibit 4.1 Form of Non-Qualified Stock Option of Tel-Save, Inc. Filed
herewith.
Exhibit 4.2 Form of Assumption of Tel-Save Holdings, Inc. relating to
Non-Qualified Stock Options of Tel-Save, Inc. Filed herewith.
Exhibit 4.3 Non-Qualified Stock Option for Joseph Morena. Filed herewith.
Exhibit 5 Opinion of Aloysius T. Lawn, IV, General Counsel and Secretary
of Tel-Save Holdings, Inc. with respect to the validity of the
Common Stock being registered. Filed herewith.
Exhibit 23.1 Consent of BDO Seidman, LLP, certified public accountants.
Filed herewith.
Exhibit 23.2 Consent of Aloysius T. Lawn, IV (included in Exhibit 5).
Exhibit 24 Powers of attorney of the directors and certain officers of
the Company. Included in the signature pages of the
Registration Statement at pages II-6, II-7.
II-7
<PAGE>
Exhibit 4.1
NON-QUALIFIED STOCK OPTION
To: ______________________________________________________________________
Name
-----------------------------------------------------------------------
Address
Date of Grant: _______________________________________________________________
You are hereby granted an option, effective as of the date hereof, to
purchase _____ shares of common stock, $1.00 stated par value ("Common Stock")
of Tel-Save, Inc. (the "Company"), a Pennsylvania statutory close corporation,
at a price of _________ per share.
Your option may first be exercised on and after twenty-two months from
the date of grant, but not before that time. On and after twenty-two months and
prior to five years from the date of grant, your option may be exercised for up
to 100% of the total number of shares subject to the option minus the number of
shares previously purchased by exercise of the option. This option shall
terminate and is not exercisable after five years from the date of its grant
(the "Scheduled Termination Date"), except if terminated earlier as hereafter
provided.
You may exercise your option by giving written notice to the Secretary
of the Company on forms supplied by the Company at its then principal executive
office, accompanied by payment of the option price for the total number of
shares you specify that you wish to purchase. The payment may be in any of the
following forms: (a) cash, which may be evidenced by a check, and includes cash
received from brokers in so-called "cashless exercises"; (b) (unless prohibited
by the Company) certificates representing shares of Common Stock of the Company,
which will be valued by the Secretary of the Company at the fair market value
per share of the Company's Common Stock on the date of delivery of such
certificates to the Company, accompanied by an assignment of the stock to the
Company; or (c) (unless prohibited by the Company) any combination of cash and
Common Stock of the Company valued as provided in clause (b). Any assignment of
stock shall be in a form and substance satisfactory to the Secretary of the
Company, including guarantees of signature(s) and payment of all transfer taxes
if the Secretary deems such guarantees necessary or desirable.
<PAGE>
In the event of any change in the outstanding shares of the Common
Stock of the Company, or in the event of any change in the stock ownership of
the Company, by reason of a stock dividend, stock split, combination of shares,
recapitalization, merger, consolidation, transfer of assets, transfer of stock
(including, but not limited to, formation of a holding company), reorganization,
conversion or what the Company deems in its sole discretion to be similar
circumstances, the number and kind of shares subject to this option and the
option price of such shares shall be appropriately adjusted in a manner to be
determined in the sole discretion of the Company. You hereby agree to promptly
surrender this option for cancellation if required by the Company pursuant to
the preceding sentence.
This option is not transferable otherwise than by will or the laws of
descent and distribution, and is exercisable during your lifetime only by you,
including, for this purpose, your legal guardian or custodian in the event of
disability. Until the option price has been paid in full pursuant to due
exercise of this option and the purchased shares are delivered to you, you do
not have any rights as a shareholder of the Company. The Company reserves the
right not to deliver to you the shares purchased by virtue of the exercise of
this option during any period of time in which the Company deems, in its sole
discretion, that such would violate a federal, state, local or securities
exchange rule, regulation or law.
Notwithstanding anything to the contrary contained herein, this option
is not exercisable until all the following events occur and during the following
periods of time:
(a) Until this option and the optioned shares are approved
and/or registered with such federal, state and local regulatory bodies or
agencies and securities exchanges as the Company may deem necessary or
desirable; or
(b) During any period of time in which the Company deems that
the exercisability of this option, the offer to sell the shares optioned
hereunder, or the sale thereof, may violate a federal, state, local or
securities exchange rule, regulation or law, or may cause the Company to be
legally obligated to issue or sell more shares than the Company is legally
entitled to issue or sell; or
(c) If this option is exercised prior to an initial public
offering of the stock of the Company or of any holding company which owns,
directly or indirectly, all of the stock of the Company, or within nine months
after such initial public offering, until you have entered into or agreed to
enter into a so-called "lock-up agreement" in form and substance satisfactory to
any managing underwriters for such initial public offering and to the Company;
or
(d) Until you have paid or made suitable arrangements to pay
(i) all federal, state and local income tax withholding required to be withheld
by the Company in connection with the option exercise and (ii) the employee's
portion of other federal, state and local payroll and other taxes due in
connection with the option exercise.
<PAGE>
The following two paragraphs shall be applicable if, on the
date of exercise of this option, the Common Stock to be purchased pursuant to
such exercise has not been registered under the Securities Act of 1933, as
amended, and under applicable state securities laws, and shall continue to be
applicable for so long as such registration has not occurred:
(a) The optionee hereby agrees, warrants and represents that
he will acquire the Common Stock to be issued hereunder for his own account for
investment purposes only, and not with a view to, or in connection with, any
resale or other distribution of any of such shares, except as hereafter
permitted. The optionee further agrees that he will not at any time make any
offer, sale, transfer, pledge or other disposition of such Common Stock to be
issued hereunder without an effective registration statement under the
Securities Act of 1933, as amended, and under any applicable state securities
laws or an opinion of counsel acceptable to the Company to the effect that the
proposed transaction will be exempt from such registration. The optionee shall
execute such instruments, representations, acknowledgments and agreements as the
Company may, in its sole discretion, deem advisable to avoid any violation of
federal, state, local or securities exchange rule, regulation or law.
(b) The certificates for Common Stock to be issued to the
optionee hereunder shall bear the following legend:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended, or under
applicable state securities laws. The shares have been acquired for
investment and may not be offered, sold, transferred, pledged or
otherwise disposed of without an effective registration statement under
the Securities Act of 1933, as amended, and under any applicable state
securities laws or an opinion of counsel acceptable to the Company that
the proposed transaction will be exempt from such registration. The
shares subject to this option may be subject to certain repurchase
rights and rights of first refusal; a description of such rights is on
file with the Secretary of the Company."
The foregoing legend, except for the last sentence thereof, shall be removed
upon registration of the legended shares under the Securities Act of 1933, as
amended, and under any applicable state laws or upon receipt of any opinion of
counsel acceptable to the Company that said registration is no longer required.
The sole purpose of the agreements, warranties, representations and
legend set forth in the two immediately preceding paragraphs is to prevent
violations of the Securities Act of 1933, as amended, and any applicable state
securities laws.
It is the intention of the Company and you that this option shall not
be an "Incentive Stock Option" as that term is used in Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code"), and the regulations
thereunder.
<PAGE>
In the event this option is exercised prior to a public offering of the
stock of the Company or a holding company which owns, directly or indirectly,
all of the stock of the Company, the following shall apply: (a) the Company
shall have the right, at any time prior to such public offering, to repurchase
the stock subject to this option at its then fair market value; (b) prior to
such public offering, neither the stock subject to this option nor any interest
in such stock shall be transferred, directly or indirectly, or pledged or
otherwise disposed of (i) to an ineligible shareholder under Subchapter S of the
Code or (ii) without providing the Company with a written right of first refusal
in form and substance reasonably satisfactory to the Company and, if such right
of first refusal is not exercised, without having the transferee or pledgee
agree, in writing, to be bound by all of the provisions of this option; and (c)
you agree to make such Subchapter S elections as the Company may request. If the
Company elects to repurchase your stock as provided in clause (a) above, the
Company shall notify you in writing of such election and, effective upon the
delivery of such notice to you, your stock shall be deemed to have been
automatically transferred to the Company by operation of law (and the Secretary
of the Company shall be authorized to effectuate such transfer), subject only to
your right to receive the fair market value of such stock within sixty days
after the date of such written election by the Company.
This option constitutes the entire understanding between the Company
and you with respect to the subject matter hereof and no amendment, supplement
or waiver of this option, in whole or in part, shall be binding upon the Company
unless in writing and signed by the Chief Executive Officer of the Company. This
option and the performances of the parties hereunder shall be construed in
accordance with and governed by the laws of the Commonwealth of Pennsylvania
applicable to contracts made and to be performed solely in Pennsylvania.
Please sign the copy of this option and return it to the Company's
Secretary, thereby indicating your understanding of and agreement with its terms
and conditions.
TEL-SAVE, INC.
By: ______________________________________
Title: Chief Executive Officer
I hereby acknowledge receipt of a copy of the foregoing stock option and, having
read it hereby signify my understanding of, and my agreement with, its terms and
conditions. This further confirms that this option reflects a verbal commitment
made by the Company to me on the date of its grant as reflected hereon.
- --------------------------------------------------- ---------------
(Signature) (Date)
<PAGE>
Exhibit 4.2
ASSUMPTION
----------
Tel-Save Holdings, Inc. hereby assumes the obligations of Tel-Save,
Inc., a Pennsylvania statutory close corporation, under the attached
Non-Qualified Stock Option granted to _____________________ (the "Grantee") on
_________________ and hereby agrees that such option shall hereafter apply to
_____________ shares of common stock of Tel-Save Holdings, Inc. common stock and
that the adjusted option price shall be _________ per share.
TEL-SAVE HOLDINGS, INC.
Date:_________________ By:___________________________
The above-named Grantee of the option described above originally
granted to the Grantee by Tel-Save, Inc., hereby (a) agrees to the assumption of
such option by Tel-Save Holdings, Inc. and (b) further agrees that the option
originally granted to such Grantee by Tel-Save, Inc., which is assumed
hereunder, shall no longer be enforceable against Tel-Save, Inc., and is hereby
surrendered for cancellation, and that the Grantee's sole rights in the future
shall be against Tel-Save Holdings, Inc. under the assumed option.
Date:_________________ ________________________________(SEAL)
SIGNATURE OF GRANTEE
<PAGE>
Exhibit 4.3
NONSTATUTORY STOCK OPTION AGREEMENT
THIS NONSTATUTORY STOCK OPTION AGREEMENT ("Agreement") is made
and entered into as of April 23, 1996 by and between Joseph Morena ("Morena")
and Tel-Save Holdings, Inc., a Delaware corporation ("Holdings").
WITNESSETH:
WHEREAS, Morena, Holdings and Tel-Save, Inc., a Pennsylvania
corporation and wholly owned subsidiary of Holdings, have entered into a
Separation Agreement and General Release dated as of April 23, 1996 ("Separation
and Release");
WHEREAS, Section 5 of such Separation and Release provides for
the grant of a nonstatutory stock option ("Option") to Morena to purchase 18,000
shares of common stock, $.01 par value ("Common Stock"), of Holdings on the
terms and conditions set forth therein; and
WHEREAS, Morena and Holdings desire to set forth the terms and
conditions of such Option herein;
NOW THEREFORE, in consideration of the foregoing and the
mutual promises contained in the Separation and Release and herein, it is agreed
as follows:
1. Grant Option. Subject to the terms of this Agreement and
the Separation and Release, Holdings hereby grants to Morena the Option to
purchase from Holdings 18,000 shares of Common Stock ("Covered Shares") at an
exercise price of $17.50 per share ("Exercise Price").
2. Terms of the Option.
a. Type of Option. The Option is intended to be a
nonstatutory stock option, and is not an incentive stock option within the
meaning of section 422 of the Code.
b. Option Period. The Option shall become exercisable
in full on April 23, 1999; provided, however, that Morena's right to exercise
the Option shall be subject to Morena's compliance with all terms and conditions
of the Separation and Release as determined in the sole and binding discretion
of Holding's Chairman. This Option shall be exercised only with respect to all
of the Covered Shares, and such Option shall expire at midnight, October 23,
1999. To the extent that Holding's Chairman determines in his sole and binding
discretion that Morena has failed to comply with all terms and conditions of the
Separation and Release, Holdings will deliver a written notice to Morena as to
such failure(s).
c. Nontransferability. The Option is not transferable
by Morena, and is exercisable, during Morena's lifetime, only by Morena or, in
the event of Morena's legal disability, by Morena's legal representative.
<PAGE>
d. Payment of the Option Price. Morena, upon exercise
of the Option, shall pay the Exercise Price in cash.
3. Capital Adjustments. The number of Covered Shares and the
Exercise Price shall be appropriately and equitably adjusted in a manner to be
determined in the sole discretion of Holdings in the event of any change in the
outstanding shares of Common Stock by reason of stock split, stock dividend,
combination of shares, recapitalization, merger, consolidation, transfer of
assets, reorganization, conversion or what Holdings determines, in it's sole
discretion, to be similar circumstances.
4. Exercise. The Option shall be exercised by the delivery to
Holdings of written notice of such exercise, accompanied by (i) full payment of
the Exercise Price and (ii) any amounts required to be withheld pursuant to
applicable income tax laws in connection with such exercise.
5. Rights as Stockholder. Morena shall have no rights as a
stockholder with respect to any Covered Shares until and unless a certificate or
certificates representing such Covered Shares are issued to Morena pursuant to
this Agreement. Except as provided in Paragraph 3, no adjustment shall be made
for dividends or other rights for which the record date is prior to issuance of
such certificate or certificates.
6. Subject to Separation and Release. The Option evidenced by
this Agreement and the exercise thereof are subject to the terms and conditions
of the Separation and Release, which are incorporated herein by reference and
made a part hereof.
IN WITNESS WHEREOF, Holdings has caused this Agreement to be
signed on its behalf effective as of the date first written above.
ATTEST: TEL-SAVE HOLDINGS, INC.
_____________________________ By:___________________________
Accepted and agreed to:
- -----------------------------
Joseph Morena
<PAGE>
Exhibit 5
May 24, 1996
Board of Directors of
Tel-Save Holdings, Inc.
22 Village Square
New Hope, PA 18938
Re: Issuance of Shares of Common Stock by Tel-Save Holdings, Inc.
Upon Exercise of Certain Non-Qualified Stock Options
----------------------------------------------------
Gentlemen:
I have acted as general counsel to Tel-Save Holdings, Inc. (the
"Company") in connection with the Company's filing pursuant to the Securities
Act of 1933, as amended (the "Act"), of a registration statement on Form S-8,
(the "Registration Statement"), relating to the issuance of 1,245,900 shares of
common stock, par value $.01 per share (the "Common Stock") upon the exercise of
certain non-qualified stock options of Daniel Borislow, Gary W. McCulla, Emanuel
J. DeMaio, Peter K. Morrison, Joseph M. Morena, Mary Kennon, Jackie Cooke, Jr.,
Jeffrey Earhart, David Gross and Gregory Luff (collectively, "Options"). You
have requested my opinion as to certain matters with respect to the issuance of
the Common Stock.
I have examined such corporate records of the Company, including its
Amended and Restated Certificate of Incorporation, its By-laws, and resolutions
of the Board of Directors, as well as such other documents as I deemed necessary
for rendering the opinion hereinafter expressed.
On the basis of the foregoing, I am of the opinion that the Common
Stock has been duly authorized by the Board of Directors of the Company and,
upon exercise of the Options and payment of the option price of such Option as
provided therein, the Common Stock will be legally issued, fully paid, and
nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of my name therein.
Sincerely yours,
Aloysius T. Lawn, IV
General Counsel and Secretary
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
Tel-Save Holdings, Inc.
We hereby consent to the incorporation by reference in the Prospectus
constituting a part of this Registration Statement on Form S-8 of our reports
dated February 7, 1996, except for Notes 4, 6(c) and 10 which are dated March
25, 1996, relating to the consolidated financial statements and schedule of
Tel-Save Holdings, Inc. and subsidiaries, appearing in the Company's Annual
Report on Form 10-K for the year ended December 31, 1995.
BDO Seidman, LLP
New York, New York
May 23, 1996
