SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) December 13, 1996
Tel-Save Holdings, Inc.
(Exact Name of Registrant as Specified in Charter)
Delaware 0-26728 23-2827736
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
6805 Route 202, New Hope, PA 18938
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code 215-862-1500
(Former Name or Former Address, if Changed Since Last Report)
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ITEM 2. Acquisition or Disposition of Assets.
The Registrant and Tel-Save, Inc., a Pennsylvania corporation
and a wholly-owned subsidiary of the Registrant ("Tel-Save")
and American Business Alliance, Inc., a Pennsylvania
corporation ("ABA"), Sam Means, Scott Arch, Ellen Arch, the
Voting Trust U/A dated September 1, 1993 under which Ralph
Arch is the Trustee and Ralph Arch, entered into a
Restructuring Agreement dated December 13, 1996 (the
"Restructuring Agreement") which provided for the eventual
settlement of the issues between the parties and outstanding
obligations. ABA is an independent long distance and marketing
company that pursuant to a Partition Agreement ("Partition
Agreement) with Tel-Save purchased or otherwise provided
end-users the long distance services provided by Tel-Save.
Pursuant to the Restructuring Agreement, ABA agreed to sell,
assign, convey and transfer to Tel-Save substantially all of
the assets of ABA, which consist primarily of ABA's long
distance marketing, operations and end-user servicing systems,
its third party contracts for offering long distance services,
end-user servicing systems, related contracts, certain
end-users and customers provisioned by Tel-Save pursuant to
the Partition Agreement (collectively, the "Customers"), all
contracts or other agreements entered into between ABA and the
Customers (the "Customer Agreements"), accounts receivable
arising in connection with the Customer Agreements; cash or
cash equivalents, certain computer equipment and software, a
real property lease and certain other assets of ABA designated
by Tel-Save over the next sixty (60) days (collectively, the
"Assets"). In consideration of ABA's agreement to sell, assign
and transfer the Assets to Tel-Save, Tel-Save paid ABA an
aggregate of $9,450,000.00 on December 13, 1996, agreed to
assume certain designated liabilities of ABA and released ABA
from its outstanding obligations to make payments to Tel-Save
for telecommunication services or previous advances made to
ABA pursuant to the Partition Agreement, representing an
aggregate consideration for the Assets of approximately
$23,000,000.00. The Registrant utilized cash on hand for the
advance.
ITEM 5. Other Events.
On December 12, 1996, the Board of Directors of the Registrant
elected George Farley as a Director of the Registrant, to
serve until the Registrant's annual meeting of stockholders in
1997. Mr. Farley is currently Group Vice President of
Finance/Chief Financial Officer of Twin County Grocers, Inc.,
a food distribution company. Prior to joining Twin County in
September of 1995, Mr. Farley was a partner of BDO Seidman,
where he had served as a partner since 1974.
ITEM 7. Financial Statements and Exhibits.
(a) Financial statements of businesses acquired.
If applicable, financial statements for the business
acquisition described in Item 2 will be filed in an amendment
to this Form 8-K as soon as practicable, but not later than 60
days after the date hereof.
(b) Pro forma financial information.
If applicable, Pro forma financial information for the
transaction described in Item 2 will be filed in an amendment
to this Form 8-K as soon as practicable, but not later than 60
days after the date hereof.
(c) Exhibits
2.1 Restructuring Agreement dated as of December 13, 1996 by
and between Tel-Save Holdings, Inc. and Tel-Save, Inc. and
American Business Alliance, Inc., Sam Means, Scott Arch,
Ellen Arch, the Voting Trust U/A dated September 1, 1993
under which Ralph Arch is the Trustee, and Ralph Arch (to
be filed by amendment).
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Tel-Save Holdings, Inc.
(Registrant)
Date: December 30, 1996 By:/s/ Joseph Schenk
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Chief Financial Officer and
Treasurer
