60,000 Shares
INTER-TEL
Common Stock
All of the 60,000 shares of Common Stock of Inter-Tel, Incorporated
("Inter-Tel" or the "Company") offered hereby are being offered for sale from
time to time by certain of the Company's shareholders (the "Selling
Shareholders"). See "Selling Shareholders." The Company has been advised that
the Selling Shareholders expect to offer the shares on the Nasdaq National
Market System through certain broker-dealers at the then current market price or
in negotiated transactions. See "Plan of Distribution." The Company will not
receive any of the proceeds from the sale of shares by the Selling Shareholders.
SEE "RISK FACTORS" COMMENCING ON PAGE 3 FOR INFORMATION THAT SHOULD BE
CONSIDERED BY PROSPECTIVE INVESTORS.
The Selling Shareholders will bear all discounts and commissions paid
to broker-dealers in connection with the sale of the shares and the fees and
expenses of any counsel and other advisers that the Selling Shareholders may
employ to represent them in this offering.
The Common Stock is quoted on the NASDAQ National Market System under
the trading symbol "INTL." On March 26, 1996, the last sale price of the Common
Stock as reported by the NASDAQ National Market System was $16.00 per share.
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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 March 26, 1996
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No person is authorized to give any information or to make any
representations, other than those contained in this Prospectus, in connection
with the offering described herein, and, if given or made, such information or
representations must not be relied upon as having been authorized by the Company
or the Selling Shareholders. This Prospectus does not constitute an offer to
sell, or a solicitation of an offer to buy, nor shall there be any sale of these
securities by any person in any jurisdiction in which it is unlawful for such
person to make such offer, solicitation or sale. Neither the delivery of this
Prospectus nor any sale made hereunder shall under any circumstances create an
implication that the information contained herein is correct as of any time
subsequent to the date hereof.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports, proxy statements and other information
statements and other information with the Securities and Exchange Commission
(the "Commission"). Such reports, proxy and information statements and other
information filed by the Company can be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Judiciary Plaza, Washington, D.C. 20549, and at the following Regional Offices
of the Commission: New York Regional Office, 7 World Trade Center, 13th Floor,
New York, New York 10048, and Chicago Regional Office, Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of
such material may be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549,
at prescribed rates.
The Company has filed with the Commission a Registration Statement on
Form S-3 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the Common Stock offered hereby.
This Prospectus does not contain all the information set forth in the
Registration Statement and the exhibits and schedules thereto, certain parts of
which are omitted in accordance with the rules and regulations of the
Commission. Statements contained in this Prospectus as to the contents of any
contract or other document 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 this Registration Statement or incorporated by reference herein. For
further information regarding the Company and the Common Stock offered by this
Prospectus, reference is made to such Registration Statement and the exhibits
and schedules thereto. The Registration Statement and the exhibits and schedules
thereto may be inspected without charge at the office of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549, and copies may be obtained from the
Commission at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission are hereby
incorporated in this Prospectus by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994;
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1995;
(c) The Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1995;
(d) The Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1995; and
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(e) The description of the Registrant's capital stock contained in the
Registrant's Registration Statement on Form 8-A filed with the Securities
and Exchange Commission pursuant to Section 12(g) of the Exchange Act of
1934 on February 26, 1982 (File No. 0-10211).
All other documents filed by the Company pursuant to Section 13(a),
13(c), 14 of 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the Shares offered hereby shall
be deemed to be incorporated by reference into this Prospectus. Any statement
contained in a document, all or a portion of which is incorporated herein by
reference, shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any
subsequently dated document, which also is incorporated herein by reference,
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.
The Company will provide without charge to each person to whom this
Prospectus is delivered, on the written or oral request of any such person, a
copy of any or all of the documents incorporated herein by reference (other than
exhibits to such documents which are not specifically incorporated by reference
in such documents). Written requests for such copies should be directed to the
Company's executive offices as follows: Inter-Tel, Incorporated, 120 North 44th
Street, Suite 200, Phoenix, Arizona 85034. Telephone requests may be directed to
(602) 302-8900, Attn: Corporate Secretary.
RISK FACTORS
In evaluating the Company's business, prospective investors should
carefully consider the following factors in addition to the other information
presented in this Prospectus and the documents incorporated by reference herein.
Rapid Technological Change and Dependence on New and Timely Product
Introductions
The market for the Company's systems, products and services is
characterized by rapid technological change and continuing demand for new
products, features and applications. Current competitors or new market entrants
may develop new products or product features that could adversely affect the
competitive position of the Company's products. Accordingly, the timely
introduction of new products and product features, as well as new
telecommunications applications, will be a key factor in the Company's future
success. Occasionally, new products contain undetected errors or "bugs" when
released. Such bugs may result from bugs contained in software products offered
by the Company's suppliers or other third parties that are intended to be
compatible with the Company's products, over which the Company has little or no
control. Although the Company seeks to minimize the number of bugs in its
products by its test procedures and strict quality control, there can be no
assurance that its new products will be error free when introduced. Any
significant delay in the commercial introduction of the Company's products due
to bugs, any design modifications required to correct bugs or any impairment of
customer satisfaction as a result of bugs could have a material adverse effect
on the Company's business and operating results. In addition, new products often
take several months before their manufacturing costs stabilize, which may
adversely affect operating results for a period of time following introduction.
The Company recently began shipping its new Inter-Tel Axxent telephone system,
an OS/2 version of its voice processing software, and a number of upgrades to
its existing AXXESS systems. In the event that the Company were to fail to
successfully introduce new systems, products or services or upgrades to its
existing systems or products on a regular and timely basis, demand for the
Company's existing systems, products and services could decline, which could
have a material adverse effect on the Company's business and operating results.
There can be no assurance that the Company will be able to successfully develop
new systems, products, services, technologies and applications on a timely basis
as required by changing market needs or that new
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systems or products or enhancements thereto, including its recently announced
products and upgrades, when introduced by the Company will achieve market
acceptance.
The Company has recently developed and continues to develop products
designed to address the emerging market for the convergence of voice and data
applications, or computer telephony integration. If the computer telephony
integration ("CTI") market fails to develop or grows more slowly than the
Company anticipates, or if the Company is unable for any reason to capitalize on
this emerging market opportunity, the Company's business and operating results
could be materially adversely affected.
Dependence Upon Contract Manufacturers and Component Suppliers
Certain components used in the Company's systems, including certain
microprocessors, integrated circuits, power supplies and voice processing
interface cards, are currently available from a single source or limited sources
of supply, and certain of these components, including integrated circuits, are
currently in limited supply. In addition, the Company currently manufactures its
products through a limited number of contract manufacturers located in the
United States, the Philippines and the People's Republic of China. Foreign
manufacturing facilities are subject to changes in governmental policies,
imposition of tariffs and import restrictions and other factors beyond the
Company's control. Varian Associates, Inc. ("Varian") currently manufactures a
significant portion of the Company's products at Varian's Tempe, Arizona
facility, including substantially all of the printed circuit boards used in the
AXXESS and Inter-Tel Axxent systems. From time to time, the Company has
experienced delays in the supply of components and finished goods and there can
be no assurance that the Company will not experience such delays in the future.
The Company's reliance on third party manufacturers involves a number of
additional risks, including reduced control over delivery schedules, quality
assurance and costs. Any delay in delivery or shortage of supply of components
or finished goods from Varian or any other supplier, or the Company's inability
to develop in a timely manner alternative or additional sources if and when
required, could damage the Company's relationships with current and prospective
customers and could materially and adversely affect the Company's business and
operating results. The Company has no long term agreements with its suppliers
that require the suppliers to provide fixed quantities of components or finished
goods at set prices. There can be no assurance that the Company will be able to
continue to obtain components or finished goods in sufficient quantities or
quality or on favorable pricing and delivery terms in the future.
Competition
The market for the Company's telephone system products is highly
competitive and in recent periods has been characterized by pricing pressures
and business consolidations. The Company's competitors include AT&T Corp.
("AT&T") and Northern Telecom Limited ("NorTel"), as well as Comdial Corporation
("Comdial"), EXECUTONE Information Systems, Inc. ("Executone"), Mitel
Corporation ("Mitel"), Panasonic, Siemens ROLM Communications Inc. ("ROLM"),
Toshiba and others. The Company also competes against the regional Bell
operating companies ("RBOCs"), which offer systems produced by one or more of
the aforementioned competitors and also offer Centrex systems in which automatic
calling facilities are provided through equipment located in the telephone
company's central office. Competition by the RBOCs could increase significantly
if the RBOCs are granted the right to manufacture telephone systems and
equipment themselves and/or to bundle the sale of equipment with telephone
calling services, activities which to date they have been restricted from
undertaking. Legislative initiatives may have the effect of increasing
competition from the RBOCs.
In the market for voice processing applications, including voice mail,
the Company competes against Centigram Communications Corporation ("Centigram"),
Octel Communications Corporation ("Octel"), Active Voice Corporation ("Active
Voice"), Applied Voice Technology, Inc. ("AVT") and other competitors, including
telephone
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systems manufacturers such as AT&T, NorTel and ROLM, which offer integrated
voice processing systems under their own label as well as through various OEM
arrangements. Certain of the Company's competitors may achieve marketing
advantages by bundling their voice processing equipment with sales of telephone
systems, or by designing their telephone systems so that they do not readily
integrate with independent voice processing systems. Inter-Tel expects that the
development of industry standards and the acceptance of open systems
architectures in the voice processing market will reduce technical barriers to
market entry and lead to increased competition.
In the market for long distance services, the Company competes against
AT&T, MCI Telecommunications Corporation ("MCI"), Sprint Corporation ("Sprint")
and other suppliers, certain of which also supply the long distance calling and
network services that the Company resells. Although the Company acquires a
variety of long distance calling services in bulk from certain long distance
carriers, there can be no assurance that the Company will be able to purchase
long distance calling services on favorable terms from one or more of such
providers in the future. In addition, a substantial majority of prospective new
long distance customers for the Company currently purchase long distance calling
services from the Company's competitors. The Company believes that it is likely
to face increased competition in the long distance calling services market to
the extent that telecommunications deregulation enables RBOCs to supply long
distance calling and network services or enables RBOCs and others to bundle long
distance, local telephone and wireless services. Moreover, the Company expects
to face increased competition in the future because low technical barriers to
entry will allow new market entrants.
Many of the Company's competitors have significantly greater financial
and technical resources, name recognition and marketing and distribution
capabilities than the Company. The Company expects that competition will
continue to be intense in the markets addressed by its products and services,
and there can be no assurance that the Company will be able to compete
successfully in the future.
Management of Growth; Implementation of New Management Information Systems
The growth in the Company's business has placed, and is expected to
continue to place, a significant strain on the Company's personnel, management
and other resources. The Company's ability to manage any future growth
effectively will require it to attract, train, motivate and manage new employees
successfully, to integrate new employees into its overall operations and to
continue to improve its operational, financial and management information
systems. In particular, the Company has recently implemented new management
information systems (MIS). The Company believes the new MIS systems will
significantly affect many aspects of its business, including its accounting,
operations, purchasing, sales and marketing functions. The successful
implementation of such systems will be crucial to the Company's provision of
services and to enable future growth. The Company has experienced some
difficulty in the implementation of its new MIS systems. This difficulty has had
an adverse effect on the Company's ability to provide products and services to
its customers on a timely basis, and, in addition, has caused some delay in
coordinating accounting and financial results. There can be no assurance that
the Company will correct the problems it is experiencing in the implementation
of the new MIS systems on a timely basis. If such difficulties continue, the
Company's business and operating results could be materially adversely affected.
In addition, there can be no assurance that, once successfully implemented, the
new MIS systems will be adequate to support the Company's operations.
The Company has made strategic acquisitions in the past and expects to
continue to do so in the future. Acquisitions require a significant amount of
the Company's management attention and financial and operational resources, all
of which are limited. The integration of acquired entities may also result in
unexpected costs and disruptions, and significant fluctuations in, or reduced
predictability of, operating results from period to period. There can be no
assurance that an acquisition will not adversely affect the business
relationships of the Company or the acquired entity with their respective
suppliers or customers. Further, there can be no assurance that the Company will
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successfully integrate the acquired operations or achieve any of the intended
benefits of an acquisition. The Company's failure to manage its growth
effectively could have a material adverse effect on its business and operating
results.
Product Protection and Infringement
The Company's future success is dependent in part upon its proprietary
technology. The Company has no patents and relies principally on copyright and
trade secret law and contractual provisions to protect its intellectual
property. There can be no assurance that any copyright owned by the Company will
not be invalidated, circumvented or challenged or that the rights granted
thereunder will provide competitive advantages to the Company. Further, there
can be no assurance that others will not develop technologies that are similar
or superior to the Company's technology or that duplicate the Company's
technology. As the Company expands its international operations, effective
intellectual property protection may be unavailable or limited in certain
foreign countries. There can be no assurance that the steps taken by the Company
will prevent misappropriation of its technology. Litigation may be necessary in
the future to enforce the Company's intellectual property rights, to protect the
Company's trade secrets, to determine the validity and scope of the proprietary
rights of others, or to defend against claims of infringement or invalidity.
Such litigation could result in substantial costs and diversion of resources and
could have a material adverse effect on the Company's business and operating
results.
From time to time, the Company is subject to proceedings alleging
infringement by the Company of intellectual property rights of others. If any
such claim is asserted against the Company, the Company may seek to obtain a
license under the third party's intellectual property rights. There can be no
assurance that a license will be available on terms acceptable to the Company or
at all. In the alternative, the Company could resort to litigation to challenge
any such claim, which could require the Company to expend significant sums and
could require the Company to pay significant damages, develop noninfringing
technology or acquire licenses to the technology which is the subject of the
asserted infringement, any of which could have a material adverse effect on the
Company's business and operating results. In the event that the Company is
unable or chooses not to license such technology or decides not to challenge
such third party's rights, the Company could encounter substantial and costly
delays in product introductions while attempting to design around such third
party rights, or could find that the development, manufacture or sale of
products requiring such licenses could be materially inhibited.
Potential Fluctuations in Quarterly Results; Limited Backlog
The Company's quarterly operating results depend upon a variety of
factors, including the volume and timing of orders received during the quarter,
the mix of products sold and mix of distribution channels, general economic
conditions, patterns of capital spending by customers, the timing of new product
announcements and releases by the Company and its competitors, pricing pressures
and the availability and cost of products and components from the Company's
suppliers. The Company's customers typically require the immediate shipment and
installation of systems. As a result, the Company has historically operated with
a relatively small backlog, and sales and operating results in any quarter are
principally dependent on orders booked and shipped in that quarter. Moreover,
market demand for investment in capital equipment such as telephone systems and
applications is largely dependent on general economic conditions, and can vary
significantly as a result of changing conditions in the economy as a whole. The
Company's expense levels are based in part on expectations as to future sales
and, if sales levels do not meet expectations, operating results could be
adversely affected. Because sales of systems through the Company's dealers
produce lower gross margins than sales through the Company's direct sales
organization, operating results will vary based upon the mix of sales through
direct and indirect channels. Although the Company to date has been able to
resell the rental streams from leases under its Totalease program profitably and
on a substantially current basis, the timing and profitability of lease resales
from quarter to quarter could impact operating results, particularly in an
environment
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of fluctuating interest rates. Long distance sales have, in recent periods,
grown at a faster rate than the Company's overall net sales and such sales have
lower gross margins than the Company's core business. As a result, gross margins
could be adversely affected in the event that long distance calling services
continue to increase as a percentage of net sales. In addition, the Company is
subject to seasonality in its operating results, as net sales for the first and
third quarters are frequently less than those experienced in the fourth and
second quarters, respectively. As a result of these and other factors, the
Company has in the past and could in the future experience fluctuations in sales
and operating results on a quarterly basis.
Reliance on Dealer Network
A substantial portion of the Company's net sales are made through its
network of independent dealers. The Company faces intense competition from other
telephone system and voice processing system manufacturers for such dealers'
business, as most of the Company's dealers carry products which compete with the
Company's products. The Company has no long term agreements with any of its
dealers, and there can be no assurance that any such dealer will not promote the
products of the Company's competitors to the detriment of the Company's
products. The loss of any significant dealer or group of dealers, or any event
or condition adversely affecting the Company's dealer network, could have a
material adverse effect on the Company's business and operating results. In
recent years the Company has effected a number of strategic acquisitions of
resellers of telephony products and integrated these operations with its
existing direct sales operations in the same geographic areas and in other
strategic markets. There can be no assurance that one or more of the Company's
dealers will not be acquired by a competitor and that the loss of any such
dealer so acquired will not adversely affect the Company's business and
operating results.
Risks of Providing Long Distance Services
Inter-Tel depends on a reliable supply of telecommunications services
and information from several long distance carriers. Because it does not own
transmission facilities, the Company relies on long distance carriers for the
provision of network services to the Company's customers and for billing
information. Long distance services are subject to extensive and uncertain
governmental regulation on both the federal and state level. There can be no
assurance that the promulgation of certain regulations, such as regulations
requiring the reduction of direct-dial billing rates, will not adversely affect
the Company's business and operating results. The Company currently resells long
distance services pursuant to contracts with four of the six largest long
distance carriers with U.S. networks. These contracts typically have a
multi-year term in which the Company's prices are relatively fixed and have
minimum use requirements. There can be no assurance that the Company will meet
minimum use commitments, will be able to negotiate lower rates with carriers in
the event of any decrease in end user rates or will be able to extend its
contracts with long distance carriers at prices favorable to the Company. The
Company's ability to continue to expand its long distance service operations
will depend on its ability to continue to secure reliable long distance services
from a number of long distance carriers and the willingness of such carriers to
continue to make telecommunications services and billing information available
to the Company on favorable terms.
Dependence on Key Personnel
The Company is dependent on the continued service of, and its ability
to attract and retain, qualified technical, marketing, sales and managerial
personnel. The competition for such personnel is intense, and the loss of any of
such persons, as well as the failure to recruit additional key technical and
sales personnel in a timely manner, would have a material adverse effect on the
Company's business and operating results. There can be no assurance that the
Company will be able to continue to attract and retain the qualified personnel
necessary for the development of its business.
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Possible Volatility of Stock Price
The Company believes that factors such as announcements of developments
relating to the Company's business, fluctuations in the Company's operating
results, general conditions in the telecommunications industry or the worldwide
economy, changes in legislation or regulation affecting the telecommunications
industry, an outbreak of hostilities, a shortfall in revenue or earnings from
securities analysts' expectations, announcements of technological innovations or
new products or enhancements by the Company or its competitors, developments in
intellectual property rights and developments in the Company's relationships
with its customers and suppliers could cause the price of the Company's Common
Stock to fluctuate, perhaps substantially. In addition, in recent years the
stock market in general, and the market for shares of technology stocks in
particular, have experienced extreme price fluctuations, which have often been
unrelated to the operating performance of affected companies. There can be no
assurance that the market price of the Company's Common Stock will not
experience significant fluctuations in the future, including fluctuations that
are unrelated to the Company's performance.
Concentration of Ownership
As of January 31, 1996, the Company's Chairman of the Board of
Directors and Chief Executive Officer beneficially owned approximately 22% of
the outstanding shares of the Common Stock. As a result, he has the ability to
exercise significant influence over all matters requiring shareholder approval.
In addition, the concentration of ownership could have the effect of delaying or
preventing a change in control of the Company.
THE COMPANY
Inter-Tel is a single point of contact, full service provider of
business telephone systems, telecommunications software applications, CTI, voice
processing software and long distance calling services, as well as maintenance,
leasing and support services. Because of the modular design and high level of
software content in the Company's products, including its AXXESS and Inter-Tel
Axxent systems, customers can readily increase the size and functionality of
their systems as their future telecommunications needs change. The Company
believes that it is a leading supplier of small to medium size business
telephone systems.
The Company has developed a distribution network of direct sales
offices and dealers which sells the Company's products to small to medium size
organizations and to divisions or departments of larger organizations, including
Fortune 500 companies, large service organizations and governmental agencies. In
the United States, the Company has 25 direct sales offices and a growing network
of hundreds of dealers who purchase directly from the Company. The Company is
also in the process of expanding its international dealer network.
The Company was incorporated in Arizona in July 1969. Its corporate
offices are located at 120 North 44th Street, Suite 200, Phoenix, Arizona 85034
and its telephone number at that address is (602) 302-8900. As used in this
Prospectus, "Inter-Tel" or the "Company" refers to Inter-Tel, Incorporated and
its subsidiaries.
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USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the shares
offered hereby.
SELLING SHAREHOLDERS
The following table sets forth certain information regarding the
beneficial ownership of the Company's Common Stock of the Selling Shareholders.
Percentage Number of Percentage
of Shares Being of
Name of Selling Shareholder Number Outstanding Offered Number Outstanding
- --------------------------- ------ ----------- --------- ------ -----------
William H. Frost........... 106,400 * 33,600 72,800 *
Cynthia H. Frost........... 26,600 * 8,400 18,200 *
Benny Treadway............. 57,000 * 18,000 39,000 *
- ---------------------------
* Less than one percent (1%).
PLAN OF DISTRIBUTION
The shares of Common Stock offered hereby are being offered directly by
the Selling Shareholders. The Company has been advised by the Selling
Shareholders that they intend to sell all of the shares offered hereby from time
to time during the one hundred eighty (180) day period following the date of
this Prospectus in the over-the-counter market and that sales will be made at
prices prevailing at the times of such sales. The Selling Shareholders may also
make private sales at negotiated prices directly or through a broker or brokers,
who may act as agent or as principal or by a combination of such methods of
sale. The Selling Shareholders and any underwriter, dealer or agent who
participate in the distribution of such shares may be deemed to be
"underwriters" under the Securities Act, and any discount, commission or
concession received by such persons might be deemed to be an underwriting
discount or commission under the Securities Act.
Any broker-dealer participating in such transactions as agent may
receive commissions from the Selling Shareholders (and, if acting as agent for
the purchaser of such shares, from such purchaser). Usual and customary
brokerage fees will be paid by the Selling Shareholders. Broker-dealers may
agree with the Selling Shareholders to sell a specified number of shares at a
stipulated price per share, and, to the extent such a broker-dealer is unable to
do so acting as agent for the Selling Shareholders, to purchase as principals
any unsold shares at the price required to fulfill the broker-dealer commitment
to the Selling Shareholders. Broker-dealers who acquire shares as principals may
thereafter resell such shares from time to time in transactions (which may
involve crosses and block transactions and which may involve sales to and
through other broker-dealers, including transactions of the nature described
above) in the over-the-counter market, in negotiated transactions or by a
combination of such methods of sale or otherwise at market prices prevailing at
the time of sale or at negotiated prices, and in connection with such resales
may pay to or receive from the purchasers of such shares commissions computed as
described above.
The Company has advised the Selling Shareholders that the
anti-manipulative Rules 10b-6 and 10b-7 under the Exchange Act may apply to
sales in the market, has furnished the Selling Shareholders with copies of these
Rules and has informed the Selling Shareholders of the need for delivery of
copies of this Prospectus. The Selling Shareholders
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may indemnify any broker-dealer that participates in transactions involving the
sale of the shares against certain liabilities, including liabilities arising
under the Securities Act. Any commissions paid or any discounts or concessions
allowed to any such broker-dealers, and any profits received on the resale of
such shares, may be deemed to be underwriting discounts and commissions under
the Securities Act if any such broker-dealers purchase shares as principal.
In order to comply with the securities laws of certain states, if
applicable, the Common Stock will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states, the
Common Stock may not be sold unless such shares have been registered or
qualified for sale in the applicable state or an exemption from the registration
or qualification requirement is available and is complied with.
At the time a particular offer of the shares of Common Stock registered
hereunder is made, if required, a Prospectus Supplement will be distributed that
will set forth the number of shares being offered and the terms of the offering
including the name of any underwriter, dealer or agent, the purchase price paid
by any underwriter for securities purchased from, any discount, commission and
other item constituting compensation and any discount, commission or concession
allowed or reallowed or paid to any dealer, and the proposed selling price to
the public.
There can be no assurance that the Selling Shareholders will sell all or
any of the shares of Common Stock offered hereunder.
LEGAL MATTERS
Certain matters with respect to the validity of the shares of Common Stock
offered hereby are being passed upon for the Company by Kristi S. Bonfiglio, the
Company's Corporate Counsel.
EXPERTS
The consolidated financial statements of Inter-Tel, Incorporated appearing
in Inter-Tel, Incorporated's Annual Report on Form 10-K for the year ended
December 31, 1994, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon included therein and incorporated herein by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
