PROSPECTUS
200,000 Shares
TII INDUSTRIES, INC.
Common Stock
This Prospectus relates to an aggregate of 200,000 shares
(collectively, the "Shares") of Common Stock, $.01 par value per share ("Common
Stock"), of TII Industries, Inc. ("TII" or the "Company") which may be offered
and sold from time to time by Strategic Growth International, Inc. (the "Selling
Stockholder") of which (a) 50,000 Shares were acquired upon the exercise of an
option in October 1995 at an exercise price of $4.0625 per share (the "First
Option") and (b) 150,000 Shares may be acquired upon the exercise of an option
to purchase up to a maximum of 150,000 shares of Common Stock on or before
August 31, 1997 at an exercise price of $7.50 per share (the "Second Option").
See "Selling Stockholder." Both the First Option and the Second Option
(collectively, the "Options") were granted in consideration for financial public
relations services provided by the Selling Stockholder.
The Shares may be offered for sale from time to time by the Selling
Stockholder or its pledgees, donees, transferees or other successors in
interest, in the over-the-counter market, in privately negotiated transactions
or otherwise at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices. The Shares may be sold
directly by the Selling Stockholder or through brokers or dealers. In connection
with any such sales, the Selling Stockholder and brokers or dealers
participating in such sales may be deemed "underwriters" within the meaning of
the Securities Act of 1933, as amended ("1933 Act"). See "Plan of Distribution."
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Stockholder. However, the Company has received $203,125
from the exercise of the First Option and, if and to the extent the Second
Option is exercised, would receive an aggregate of $1,125,000 if the Second
Option is exercised in full. The Company will bear all expenses in connection
with the filing of the Registration Statement of which this Prospectus forms a
part, except that the Selling Stockholder will pay all discounts and commissions
payable to brokers or dealers and the fees and expenses, if any, of counsel to
the Selling Stockholder.
SEE "RISK FACTORS" BEGINNING ON PAGE 3 FOR A DISCUSSION OF CERTAIN
FACTORS THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS.
The Common Stock of the Company is included on the Nasdaq Stock
Market National Market System ("Nasdaq/NMS") under the symbol TIII. On December
15, 1995, the closing sales price per share of the Common Stock on Nasdaq/NMS
was $7.6875.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this Prospectus is December 18, 1995
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 (the "1934 Act"), and, in accordance therewith,
files reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and other
information filed by the Company can be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's Regional
Offices, Seven World Trade Center, 13th Floor, New York, New York 10048 and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such material may be obtained at prescribed rates from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549.
INFORMATION INCORPORATED BY REFERENCE
The following documents, filed by the Company with the Commission
(File No. 1-8048) pursuant to the 1934 Act, are incorporated herein by
reference: (i) the Company's Annual Report on Form 10-K for its fiscal year
ended June 30, 1995; (ii) the Company's Quarterly Report on Form 10-Q for the
fiscal quarter ended September 30, 1995; (iii) the Company's Current Report on
Form 8-K dated (date of earliest event reported) August 15, 1995; and (iv) the
description of the Company's Common Stock contained in the Registration
Statement on Form 8-A filed with the Commission on November 3, 1980 under the
1934 Act, including any amendment or report filed by the Company for the purpose
of updating such description. Each document filed by the Company subsequent 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 this offering shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
date of filing such document. Any statement contained in a document incorporated
or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any other subsequently filed document which also is
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
This Prospectus does not contain all the information set forth in the
Registration Statement (No.33-64963) on Form S-3 (the "Registration Statement")
of which this Prospectus forms a part, including exhibits relating thereto,
which has been filed with the Commission in Washington, D.C. Copies of the
Registration Statement and the exhibits thereto may be obtained, upon payment of
the fee prescribed by the Commission, or may be examined, without charge, at the
principal office of the Commission.
THE COMPANY WILL PROVIDE, WITHOUT CHARGE, TO EACH PERSON, INCLUDING
ANY BENEFICIAL OWNER, TO WHOM A COPY OF THIS PROSPECTUS IS DELIVERED, UPON THE
WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A COPY OF ANY AND ALL OF THE
DOCUMENTS INCORPORATED BY REFERENCE IN THIS PROSPECTUS (OTHER THAN EXHIBITS
UNLESS SUCH EXHIBITS ARE EXPRESSLY INCORPORATED BY REFERENCE IN SUCH DOCUMENTS).
REQUESTS SHOULD BE DIRECTED TO TII INDUSTRIES, INC., 1385 AKRON STREET,
COPIAGUE, NEW YORK 11726, (516) 789-5000, ATTENTION: VIRGINIA M. HALL, VICE
PRESIDENT-ADMINISTRATION.
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THE COMPANY
TII is a leading supplier to United States telephone operating
companies ("Telcos") of overvoltage surge protectors. Overvoltage protectors are
required by the National Electric Safety Code to be installed on the
subscriber's (user's) home or office telephone lines to prevent injury to
telecommunication users and damage to telecommunication equipment due to
overvoltage surges caused by lightning and other hazardous electrical
occurrences. The Company's other products include network interface devices
("NIDs") and station electronics, which may be incorporated in NIDs together
with the Company's overvoltage protectors. Further, during the fiscal quarter
ended December 31, 1993 the Company introduced a line of fiber optic products in
order to par ticipate in the growing fiber optic market. The Company markets its
products, directly or indirectly, to the seven Regional Bell Operating Companies
("RBOCs") and GTE Corporation ("GTE"), which collectively service over 85% of
the 140 million subscriber lines in the United States, as well as to most of the
1,300 smaller Telcos.
The Company is a Delaware corporation organized in 1971 and is the
successor to a corporation founded in 1964 by Alfred J. Roach, Chairman of the
Board of Directors of the Company. Unless the context otherwise requires, the
terms "TII" or the "Company" refer to TII Industries, Inc., its predecessor and
its subsidiaries.
The Company's principal executive office is located at 1385 Akron
Street, Copiague, New York 11726 (telephone number (516) 789-5000) and its
principal operations office is located at Rd. 165, Kilometer 1.6, Toa Alta,
Puerto Rico 00953 (telephone number (809) 870-2700).
RISK FACTORS
Prospective purchasers should review the entire Prospectus and the
information incorporated herein by reference and carefully consider, among other
things, the following factors prior to making an investment in the securities
offered hereby.
TECHNOLOGICAL CHANGE
The Company has been selling overvoltage surge protectors,
incorporating gas tube technology, as its principal product since the late
1960s. These products are specified as a standard overvoltage protector for the
subscriber's telephone lines at five of the seven RBOCs, GTE and at most of the
1,300 smaller Telcos in the United States. Solid state surge protectors have
been developed for use within the Telco network as a competitive technology to
gas tubes. While solid state overvoltage protectors are faster at reacting to
surges, gas tube overvoltage protectors have generally remained the subscriber
overvoltage protection technology of choice by virtually all Telcos because of
the gas tube's ability to repeatedly withstand significantly higher energy
surges (critical safety and maintenance considerations for Telcos), while adding
virtually no capacitance onto the communication line (elevated capacitance
adversely affects the transmission of data over a communication line). Solid
state overvoltage protectors are used principally in Telco's central office
switching centers where speed is perceived to be more critical than energy
handling capabilities. The Company is not aware of any significant improvements
(except for certain new gas tube products discussed below being developed by the
Company and a joint venture consisting of AT&T Network Cable Systems and Raychem
Corporation) or new solid state protection technology under development.
However, the development of solid state overvoltage protectors with increased
energy handling capabilities and low capacitance could adversely affect the
Company.
There can be no assurance that the Company will be successful in
marketing its new products or developing additional new products to address
changing technological requirements, that it can introduce such products on a
timely basis or that its existing products will continue to be, or new products
will become, successful in the marketplace. The Company's failure to develop new
products or adapt its existing products to technological change and competition
could have an adverse effect on the Company's business.
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EFFECT OF CERTAIN PURCHASE ORDER DEFERRALS
Net sales and net income for the first quarter of fiscal 1996 were
$9,600,000 and $439,000, respectively, compared to $10,456,000 and $536,000,
respectively, in the first quarter of fiscal 1995. Toward the close of fiscal
1995, the Company introduced several new products, which will be jointly
manufactured with Access Network Technologies ("ANT"), a joint venture between
AT&T Network Cable Systems and Raychem Corporation. Two of the Company's current
Telco customers have evaluated these new products and have indicated that they
will approve them for use. As a result, during the first quarter of fiscal 1996,
these customers slowed their purchase of other TII products to minimize their
inventory levels in anticipation of the availability and delivery of the new
products. While limited shipments are in process, TII and ANT are addressing
joint volume production start-up delays. The Company believes that attainment of
volume production of the new products should begin at the Company's facilities
during the second quarter of fiscal 1996 and volume shipments should commence
soon after volume production begins.
FIBER OPTIC BUSINESS
The Company has begun to develop fiber optic cable products used in
connection with the installation and maintenance of fiber optic equipment and
transmission lines. The fiber optic market is characterized by innovation,
rapidly changing technology and new product development. In addition, although
TII has operated in the telecommunications industry for more than 25 years, the
Company, in entering into the fiber optic market, faces many of the
uncertainties inherent in entering into a new business area. The Company's
success in this area will depend, in large measure, upon its ability to identify
customer needs and develop new products to keep pace with continuing changes in
technology and customer preferences.
COMPETITION
While the Company is a leading supplier to Telcos of subscriber
overvoltage protectors, the Company is subject to significant competition with
respect to its protectors as well as its other products. Most of the Company's
competitors have substantially greater assets and financial resources, and have
larger sales forces, manufacturing facilities and research and development
staffs than those of the Company.
DEPENDENCE UPON KEY CUSTOMERS; LACK OF LONG TERM COMMITMENTS
Virtually all of the Company's products are sold either directly,
through distributors or as components of equipment manufactured by others,
including other NID suppliers, to the Telcos. The Telco industry is dominated by
a few large customers. The seven RBOCs and GTE service over 85% of all
subscriber lines in the United States. The Company's overvoltage protectors are
specified as a standard overvoltage protector for the subscriber's telephone
lines at five of the seven RBOCs and GTE, the loss of one or more of which
customers, or a substantial diminution in the orders received from them, could
materially and adversely affect the Company. For the year ended June 30, 1995,
direct sales to five RBOCs and GTE, known distributors thereto and manufacturers
who are known to use the Company's products as components in equipment
manufactured for these Telcos, are believed to have accounted for a substantial
majority of the Company's net sales.
ANTI-TAKEOVER PROVISIONS
Under the Company's Restated Certificate of Incorporation, the
affirmative vote of the holders of at least 75% of the Company's outstanding
shares of capital stock entitled to vote thereon is required to authorize any
merger or consolidation of the Company or any of its subsidiaries with another
entity, or a sale, lease or exchange by the Company of all or substantially all
of the assets of the Company and its subsidiaries taken as a whole, if the other
party to the transaction owns 10% or more of the Company's voting stock in the
election of directors (other than a person who was such holder on December 3,
1979), or the dissolution of the Company, unless such merger, consolidation,
sale, lease or exchange (or a dissolution substantially consistent therewith)
was approved by the Company's Board of Directors prior to the other party to the
transaction acquiring such 10% interest. Mr. Alfred J. Roach is the only person
known to have been a beneficial owner of 10% or more of the Company's voting
stock at December 3, 1979. Also, the Board of Directors is divided into three
classes, each of which is
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elected in successive years for three year terms. Accordingly, any persons
seeking to acquire voting control of the Company solely through the election of
directors would have to elect directors at two annual stockholders' meetings in
order to elect a majority of the Board. Additionally, the Restated Certificate
of Incorporation permits the Company's directors to issue shares of Preferred
Stock in one or more series and to designate the terms of each series without
further stockholder action. Each of these provisions may render impossible any
attempts by outside persons or business concerns to obtain control of the
Company in a manner which might be in the best interests of the Company's
stockholders.
SHARES ELIGIBLE FOR FUTURE SALE
Sales of a substantial number of shares of Common Stock in the public
market could adversely affect the market price for the Common Stock. As at
November 30, 1995, the Company had outstanding 7,076,008 shares of Common Stock
of which 4,372,780 shares were freely tradeable. Of the remaining outstanding
shares of Common Stock, (i) 50,000 shares are being registered for potential
resale hereunder, (ii) 1,946,813 shares are registered for potential sale under
a separate registration statement, certain of which shares are also eligible for
sale under Rule 144 promulgated under Rule 144 under the 1933 Act ("Rule 144")
and (iii) 706,415 shares held by persons who may be deemed affiliates are
eligible for sale under Rule 144.
Of the 2,732,481 shares of Common Stock presently reserved for
potential future issuance, (i) 150,000 shares are registered hereunder for
resale by the holder of the Second Option, following exercise thereof, (ii)
400,000 shares are registered for resale under a separate registration statement
upon the exercise of options (the "WinStar Options") granted pursuant to a
consulting agreement with the Company and a third party, and (iii) 300,000
shares, issuable upon conversion of certain convertible indebtedness, are
eligible for sale under paragraph (k) of Rule 144 following such conversion. The
remaining 1,882,481 shares are registered under the 1933 Act for issuance upon
the exercise of options which have been, or may in the future be, granted under
employee stock option plans. Such registration enables persons exercising those
options, who are not affiliates of the Company, to freely sell the shares of
Common Stock acquired and those who are affiliates to resell the shares acquired
under Rule 144 without any additional holding period.
In general, Rule 144 enables a stockholder to sell, within any
three-month period, a number of shares that does not exceed the greater of 1% of
the then outstanding shares of Common Stock or the average weekly trading volume
during a specified four-week period in unsolicited "broker's transactions" and
subject to certain other conditions. Paragraph (k) of Rule 144 permits a
stockholder who has not been an affiliate of the Company during the 90 days
preceding a sale by such stockholder and who has beneficially owned the shares
to be sold for at least three years (including the holding period of convertible
securities) to sell such shares without regard to the volume and other
limitations otherwise imposed by Rule 144.
No prediction can be made as to the effect, if any, that future sales
of shares of Common Stock, or the availability of additional shares of Common
Stock for future sales, will have on the market price of the Common Stock
prevailing from time to time. Sales of substantial amounts of Common Stock
(including shares issuable upon the exercise of the WinStar Options or other
options or convertible indebtedness), or the perception that such sales could
occur, could adversely affect the market price for the Common Stock.
NO DIVIDENDS ANTICIPATED
To date, the Company has paid no cash dividends. For the foreseeable
future, the Company intends to retain all earnings generated from operations for
use in the Company's business. Additionally, the Company's Revolving Credit
Agreement prohibits the payment of dividends until such indebtedness has been
repaid in full. Therefore, no dividends to stockholders can be anticipated for
the foreseeable future.
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SELLING STOCKHOLDER
As at November 30, 1995, the Selling Stockholder (i) beneficially
owned 200,000 shares of the Company's Common Stock (including 150,000 Shares
which may be acquired upon exercise of the Second Option) prior to the offering
of any Shares hereunder, (ii) may offer up to 200,000 Shares for sale hereunder
and (iii) will beneficially own no shares of the Company's Common Stock after
the offering, assuming the sale of all Shares being offered hereunder.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 30,000,000
shares of Common Stock, 10,000,000 shares of Class B Stock, $.01 par value per
share ("Class B Stock"), 100,000 shares of Class C Stock, $.01 par value per
share ("Class C Stock"), and 1,000,000 shares of Preferred Stock, $1.00 par
value per share, issuable in series ("Preferred Stock").
As of November 30, 1995, there were issued and outstanding 7,073,008
shares of Common Stock and no shares of Class B Stock, Class C Stock or
Preferred Stock were issued. No Class B Stock can be issued unless previously
approved by stockholders. Class C Stock and Preferred Stock can be issued by the
Board of Directors without the need to obtain stockholder approval.
The following is a summary of certain provisions contained in the
Company's Restated Certificate of Incorporation, as amended (the "Restated
Certificate of Incorporation"), By-Laws and Revolving Credit Loan Agreement,
copies of which are exhibits to the Registration Statement of which this
Prospectus forms a part. The summary does not purport to be complete and is
qualified in its entirety by reference to such documents.
COMMON STOCK
Voting Rights. Under the Company's Restated Certificate of
Incorporation, the holders of Common Stock have one vote per share outstanding.
The Restated Certificate of Incorporation and By-Laws provide for classification
of the Board of Directors into three classes, the directors of each class to
serve a three-year term, and allow removal of directors only for cause by
stockholders. In addition, the Company's Restated Certificate of Incorporation
requires the affirmative vote of the holders of at least 75% of the outstanding
shares of capital stock of the Company entitled to vote thereon to authorize (i)
any merger or consolidation of the Company or any of its subsidiaries with or
into another entity, (ii) any sale, lease or exchange of all or substantially
all of the assets of the Company and its subsidiaries taken as a whole if, as of
the record date for determining stockholders entitled to vote on a matter in (i)
or (ii), the other party to the transaction beneficially owns 10% or more of the
Company's outstanding capital stock entitled to vote in the election of
directors (other than a person who beneficially owned at least 10% of the
Company's voting capital stock at December 3, 1979) or (iii) the dissolution of
the Company. The supermajority voting requirement does not apply to a
transaction with a person or entity who became such 10% beneficial owner after
the Company's Board of Directors approved the transaction in (i) or (ii) or as
to a dissolution of the Company if such dissolution is substantially consistent
with such an approved transaction. The Restated Certificate of Incorporation and
By-Laws further provide that the affirmative vote of the holders of at least 75%
of the Company's outstanding voting stock is required to make, alter or repeal,
or to adopt any provision inconsistent with, the foregoing provisions of the
Company's Restated Certificate of Incorporation or By-Laws.
Dividends and Other Distributions. Subject to the rights of holders
of any Preferred Stock, the holders of shares of Common Stock are entitled to
receive dividends when, as and if declared by the Board of Directors out of
funds legally available therefor and, in the event of the liquidation,
dissolution or winding up of the Company, to share ratably in all assets
remaining after the payment of liabilities. To date, the Company has paid no
cash dividends. For the foreseeable future, the Company intends to retain all
earnings generated from operations for use in the Company's business.
Additionally, the Company's Revolving Credit Loan Agreement prohibits the
payment of dividends until such indebtedness has been repaid in full. Therefore,
no dividends to stockholders can be anticipated for the foreseeable future.
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Other. The Common Stock is not convertible into any other class of
securities, is not redeemable and does not carry any preemptive rights.
Transfer Agent. The transfer agent for the Company's Common Stock is
Harris Trust Company of New York, 77 Water Street, New York, New York 10005.
PREFERRED STOCK
The Company's Preferred Stock is issuable in one or more series from
time to time at the discretion of the Board of Directors. The Board of Directors
is authorized, with respect to each series, to fix by resolution its
designation, powers, preferences (including with respect to dividends and on
liquidation), rights (including voting, dividend, conversion, sinking fund and
redemption rights), qualifications, limitations and restrictions. Shares of
Preferred Stock issued by action of the Board of Directors could be utilized,
under certain circumstances, as a method of making it more difficult for a party
to gain control of the Company without the approval of the Board of Directors.
The Company presently has no plans or arrangements for the issuance of any
additional Preferred Stock.
CLASS B STOCK
Since their conversion into Common Stock in September 1995, there
have been no outstanding shares of Class B Stock, and no shares of Class B
Common Stock can be issued without prior stockholder approval. The Restated
Certificate of Incorporation provides that any Class B Common Stock is to be
identical to Common Stock except that shares of Class B Stock (i) would only be
entitled to dividends equal to 83-1/3% of the dividend payable on Common Stock,
if any were declared, and (ii) would vote together with Common Stock as one
class on all matters except the election of directors and on matters on which
Delaware law requires a separate vote of each such class, with each share of
Common Stock having one vote and each share of Class B Stock having ten votes.
As to the election of directors, holders of the Common Stock would vote
separately as a class for the election of 25% of the directors and, in addition,
vote together with the holders of Class B Stock as one class for the remainder
of the directors, with each share of Common Stock having one vote and each share
of Class B Stock having ten votes. If, however, on the record date for any
stockholder meeting with respect to the election of directors, the number of
outstanding shares of Class B Stock is less that 12-1/2% of the aggregate total
number of shares of Common Stock and Class B Stock then outstanding, Common
Stock would vote separately as a class for the election of 25% of the total
number of directors of the entire Board of Directors and the Class B Stock would
vote separately as a class to elect the remaining directors.
Class B Common Stock would be convertible into Common Stock on a
share for share basis at any time at the option of the holder automatically if
the number of outstanding shares of Class B Stock is less than 5% of the
aggregate number of issued and outstanding shares of Common Stock and Class B
Stock or if the Board of Directors and holders of the majority of the
outstanding shares of Class B Stock authorize such conversion. Class B Stock
would have limited rights of transferability without being automatically
converted into Common Stock on a share for share basis. The Company presently
has no plans or arrangements for the issuance of any Class B Stock.
CLASS C STOCK
Class C Stock may be sold only to employees of the Company who are
also residents of Puerto Rico. Holders of any Class C Stock which may be issued
shall be entitled to receive, when and as declared by the Board of Directors of
the Company, non-cumulative dividends at the rate of $2.00 per share per year,
and no more. The Company may, at the option of the Board of Directors, redeem in
whole or part any Class C Stock which may be issued at any time by paying $.01
for each share thereof, together with any dividends theretofore declared thereon
and remaining unpaid at the date of redemption. Except as expressly required by
law, any future holders of the Class C Stock would have no voting power,
conversion rights into Common Stock, liquidation rights or preemptive rights.
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SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW
The Company is subject to the provisions of Section 203 of the
Delaware General Corporation Law. In general, this statute prohibits a publicly
held Delaware corporation from engaging, under certain circumstances, in a
"business combination" with an "interested stockholder" for a period of three
years after the person becomes an interested stockholders, unless: (i) prior to
the time at which the stockholder became an interested stockholder, the board of
directors approved either the business combination or the transaction in which
the person becomes an interested stockholder; (ii) the stockholder acquires at
least 85% of the outstanding voting stock of the corporation (excluding shares
held by directors who are officers or held in certain employee stock plans) upon
consummation of the transaction in which the stockholder becomes an interested
stockholder; or (iii) the business combination is approved by the board of
directors and by at least 66-2/3% of the outstanding voting stock of the
corporation (excluding shares held by the interested stockholder) at a meeting
of stockholders (and not by written consent) held on or subsequent to the time
such stockholder became an interested stockholder. An "interested stockholder"
is a person who, together with affiliates and associates (each as defined in
Section 203), owns (or, in certain cases, at any time within the prior three
years did own) 15% or more of the corporation's voting stock. Section 203
defines a "business combination" generally to include, without limitation,
mergers, consolidations, stock sales, asset-based transactions and other
transactions resulting in a financial benefit to the interested stockholders.
PLAN OF DISTRIBUTION
The Shares may be offered for sale, from time to time, by the Selling
Stockholder or its pledgees, donees, transferees, or other successors in
interest, in the over-the-counter market, in privately negotiated transactions
or otherwise at market prices prevailing at the time of sale, at prices related
to such prevailing market prices or at negotiated prices. Shares under this
Prospectus may be sold by one or more of the following methods: (a) ordinary
brokerage transactions and transactions in which the broker solicits purchasers;
(b) purchases by a broker or dealer as principal, and the resale by such broker
or dealer for its account pursuant to this Prospectus, including resale to
another broker or dealer; (c) a block trade in which the broker or dealer so
engaged will attempt to sell the Shares as agent but may position and resell a
portion of the block as principal in order to facilitate the transaction; or (d)
negotiated transactions between the Selling Stockholder and purchasers without a
broker or dealer. In connection with any sales, the Selling Stockholder and
broker or dealer participating in such sales may be deemed "underwriters" within
the meaning of the 1933 Act.
Brokers or dealers selling under this Prospectus may receive
commissions, discounts or concessions from the Selling Stockholder and/or
purchasers of the Shares for whom such broker or dealers may act as agents, or
to whom they may sell as principal, or both (which compensation as to a
particular broker-dealer may be in excess of customary commissions). The Selling
Stockholder and any participating brokers or dealers may be deemed to be
"underwriters" within the meaning of the 1933 Act. Any such commissions,
discounts or concessions and any gain realized by such broker or dealer on the
sale of shares which it purchases as a principal may be deemed to be
underwriting compensation to the broker or dealer.
The Selling Stockholder has been advised by the Company that during
the time it is engaged in distributing Shares covered by this Prospectus, it
must comply with Rules 10b-5 and 10b-6 under the 1934 Act, as amended, and
pursuant thereto: (i) may not engage in any stabilization activity in connection
with the Company's securities; (ii) must furnish each broker through which
Common Stock covered by this Prospectus may be offered the number of copies of
this Prospectus which are required by each broker; and (iii) may not bid for or
purchase any securities of the Company or attempt to induce any person to
purchase any of the Company's securities other than as permitted under the 1934
Act.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon
by Parker Chapin Flattau & Klimpl, LLP, 1211 Avenue of the Americas, New York,
New York 10036.
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EXPERTS
The consolidated financial statements and schedules of TII
Industries, Inc., incorporated by reference from the Company's Annual Report on
Form 10-K for the year ended June 30, 1995, have been audited by Arthur Andersen
LLP, independent public accountants, as set forth in their report thereon
included therein and incorporated herein by reference. Such financial statements
and schedules are incorporated herein by reference in reliance upon such report
given upon the authority of such firm as experts in accounting and auditing.
ADDITIONAL INFORMATION
The Company has filed with the Commission, Washington, D.C. 20549, a
Registration Statement under the 1933 Act with respect to the shares of Common
Stock offered hereby. This Prospectus does not contain all of the information
set forth in the Registration Statement and the exhibits and schedules thereto.
For further information with respect to the Company and the Common Stock offered
hereby, reference is made to the Registration Statement and the exhibits and
schedules filed therewith. Statements contained in this Prospectus as to the
contents of any contract or any other document referred to are not necessarily
complete, and in each instance reference is made to the copy of such contract or
other document filed as an exhibit to the Registration Statement, each such
statement being qualified in all respects by such reference. A copy of the
Registration Statement may be inspected without charge at the Commission's
principal office, and copies of all or any part of the Registration Statement
may be obtained from such office upon the payment of the fees prescribed by the
Commission.
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No person has been authorized
in connection with the offering made
hereby to give any information or to
make any representation not contained
in this Prospectus or a supplement to
this Prospectus, and, if given or
made, such information or represen-
tation must not be relied upon as
having been authorized by the Company, 200,000 Shares
the Selling Stockholder or any other
person. Neither this Prospectus nor
any supplement to this Prospectus TII INDUSTRIES, INC.
constitutes an offer to sell or a
solicitation of an offer to buy, any
securities other than the securities Common Stock
to which it relates or an offer to
sell or the solicitation of an offer
to buy such securities in any juris-
diction where, or to any person to
whom it is unlawful to make such an
offer or solicitation. Neither the
delivery of this Prospectus nor any
supplement to this Prospectus nor any
sale made hereunder or thereunder
shall, under any circumstances,
create any implication that there has
been no change in the affairs of the
Company since the date hereof or
thereof or that the information con- PROSPECTUS
tained herein is correct as of any ----------
time subsequent to the dates as of
which such information is furnished.
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TABLE OF CONTENTS Page
Available Information......... 2
Information Incorporated by
Reference.................... 2
The Company................... 3
Risk Factors.................. 3
Selling Stockholder........... 6
Description of Capital
Stock........................ 6
Plan of Distribution.......... 8
Legal Matters................. 8
Experts....................... 9
Additional Information........ 9 December 18 , 1995
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