SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): September 13, 2005
TII NETWORK TECHNOLOGIES, INC.
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(Exact Name of Registrant as Specified in Charter)
DELAWARE
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(State of Incorporation)
1-8048 66-0328885
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(Commission File No.) (IRS Employer Identification No.)
1385 Akron Street, Copiague, New York 11726
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(Address of Principal Executive Offices) (Zip Code)
(631) 789-5000
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(Registrant's telephone number, including area code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[_] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[_] Pre-commencement communication pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[_] Pre-commencement communication pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
(a) On September 14, 2005, the Company entered into a Consulting
Agreement with Alfred J. Roach, a director of the Company who, at the time,
ceased being Chairman of the Company's Board of Directors (see Item 5.02 below).
A copy of the Consulting Agreement between the Company and Mr. Roach is attached
to this Report as Exhibit 99.1, and the following discussion is qualified in its
entirety by reference thereto. The Consulting Agreement with Mr. Roach provides
for Mr. Roach to make himself available at such
reasonable times and periods of time as the Company may request from time to
time to consult with the Company's executive officers and directors regarding
the Company's business and operations, focusing on the sale and marketing of the
Company's products. The Consulting Agreement provides for a term to commence on
November 1, 2005 (when Mr. Roach will cease being an employee of the Company)
and to end on October 31, 2009, subject as earlier termination in the event of
Mr. Roach's death or breach of either of his covenants to maintain the
confidentiality of confidential information of the Company and not to compete
against the Company. For his services, Mr. Roach is to receive (i) a consulting
fee of $160,000 per annum, (ii) 5% of net sales generated through his efforts
during the term of the Consulting Agreement from customers in China, India or
Russia or, prior to May 1, 2007, from one potential United States based
customer, and (iii) COBRA insurance premiums for eighteen months commencing
November 1, 2005. Mr. Roach retains the right to revoke the Consulting Agreement
until September 21, 2005.
(b) On September 14, 2005, the Company entered into a Consulting Agreement
with Charles H. House, a director of the Company (see Item 5.02 below). A copy
of the Consulting Agreement between the Company and Mr. House is attached to
this Report as Exhibit 99.2, and the following discussion is qualified in its
entirety by reference thereto. The Consulting Agreement with Mr. House provides
for Mr. House to consult with the Company in the management/marketing advisory
field to assist the Company in, among other things, the analysis, development
and implementation of a comprehensive go-to-market business plan for the
Company's new multi-service residential gateway product, Service Interface
Device ("SID"), for a term of one year. For his services, Mr. House, in lieu of
$60,000 cash compensation, elected to receive 35,000 shares of the Company's
Common Stock. The closing bid price of the Company's Common Stock on the Nasdaq
SmallCap Market on September 13, 2005, the day preceding authorization by the
Company's Board of Directors and entering into the Consulting Agreement, was
$1.50 per share.
(c) On September 13, 2005, the Compensation Committee of Company's Board
of Directors granted an option to Kenneth A. Paladino, the Company's Vice
President - Finance, Chief Financial Officer and Chief Operating Officer, under
the Company's stockholder approved 1998 Stock Option Plan, to purchase 150,000
shares of the Company's Common Stock until September 12, 2016 at $1.50 per
share, the average of the highest and lowest sales prices per share of the
Company's Common Stock on September 13, 2005. The option vests at the rate of
30,000 shares per annum commencing September 13, 2006. A copy of the Stock
Option Contract, dated September 13, 2005, between the Company and Mr. Paladino
is attached hereto as Exhibit 99.3, and the foregoing discussion is qualified in
its entirety by reference thereto.
ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On September 19, 2005, the Company issued a press release announcing its
results of operations for the fourth fiscal quarter and year ended June 24,
2005. A copy of the press release is furnished as Exhibit 99.4 to this Report
and is incorporated herein by reference.
The foregoing information, including Exhibit 99.4 and the information
therefrom incorporated herein by reference, is being furnished, and shall not be
deemed "filed," for purposes of Section 18 of the Securities and Exchange Act of
1934, as amended, or otherwise subject to the liability of that section, nor
shall it be deemed incorporated by reference in any filing under the Securities
Act of 1933, as amended, except as shall be expressly set forth by specific
reference in such a filing.
ITEM 5.02 DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS;
APPOINTMENT OF PRINCIPAL OFFICERS
On September 14, 2005, the Board of Directors amended the Company's
By-Laws (see Item 5.03 below) and eliminated the position of Chairman of the
Board as an officer position with the Company.
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As a result, Alfred J. Roach ceased being Chairman of the Board and was
appointed Chairman Emeritus. Charles H. House was appointed by the Board as
non-executive Chairman of the Board.
ITEM 5.03 AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL
YEAR.
On September 19, 2005, the Company, under authorization of its Board of
Directors, filed a Certificate of Elimination with the Secretary of State of the
State of Delaware to officially eliminate from its Certification of
Incorporation its authorized Series C Convertible Preferred Stock and return
such shares to the status of authorized but unissued shares of the Company's
Preferred Stock without designation. No shares of Series C Convertible Preferred
Stock were outstanding. A copy of the Certificate of Elimination is attached to
the Report as Exhibit 3.1.
On September 14, 2005, the Board of Directors amended the Company's
By-Laws to delete Section 6 of Article IX entitled "Chairman of the Board" and
thereby eliminate the position of Chairman of the Board as an officer of the
Company. The Company's By-laws, as amended to date, are attached to this Report
as Exhibit 3.2.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Businesses Acquired: None
(b) Pro Forma Financial Information: None
(c) Exhibits:
3.1 Certificate Eliminating Reference to Series C
Convertible Preferred Stock from the Company's
Certificate of Incorporation
3.2 By-laws of the Company
99.1 Consulting Agreement, dated September 14, 2005, between
the Company and Alfred J. Roach
99.2 Consulting Agreement, dated September 14, 2005, between
the Company and Charles K. House, together with
Nondisclosure Agreement
99.3 Incentive Stock Option Contract, dated September 13,
2005, between the Company and Kenneth A. Paladino
99.4 Press Release dated September 19, 2005.
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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 thereunto duly authorized.
TII NETWORK TECHNOLOGIES, INC.
Date: September 19, 2005 By: /s/ Timothy J. Roach
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Timothy J. Roach,
President and Chief Executive Officer
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EXHIBIT INDEX
Exhibit
Number Description
3.1 Certificate Eliminating Reference to Series C Convertible Preferred
Stock from the Company's Certificate of Incorporation
3.2 By-laws of the Company
99.1 Consulting Agreement, dated September 14, 2005, between the Company
and Alfred J. Roach
99.2 Consulting Agreement, dated September 14, 2005, between the Company
and Charles K. House, together with Nondisclosure Agreement
99.3 Incentive Stock Option Contract, dated September 13, 2005, between
the Company and Kenneth A. Paladino
99.4 Press Release dated September 19, 2005.
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