EXHIBIT 99

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                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549


                                 SCHEDULE 14D-9

                      SOLICITATION/RECOMMENDATION STATEMENT
                       PURSUANT TO SECTION 14(d)(4) OF THE
                         SECURITIES EXCHANGE ACT OF 1934



                            MILGRAY ELECTRONICS, INC.
                            (Name of Subject Company)



                            MILGRAY ELECTRONICS, INC.
                        (Name of Person Filing Statement)



                     Common Stock, Par Value $.25 Per Share
                         (Title and Class of Securities)


                                   599751 10 4
                      (CUSIP Number of Class of Securities)


                                  RICHARD HYMAN
                            Executive Vice President
                            Milgray Electronics, Inc.
                              77 Schmitt Boulevard
                           Farmingdale, New York 11735
                                 (516) 420-9800
 (Name, Address and Telephone Number of Person Authorized to Receive Notice and
            Communications on Behalf of the Person Filing Statement)


                                     Copy to

                           HERSCHEL M. WEINBERG, ESQ.
                              110 East 59th Street
                            New York, New York 10022
                            Telephone (212) 980-2600

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                                  INTRODUCTION

     This Solicitation/Recommendation Statement on Schedule 14D-9 ("Schedule
14D-9") relates to an offer by ME Acquisition, Inc., a New York corporation and
a wholly owned subsidiary of Bell Industries, Inc., a California corporation, to
purchase all of the Shares (as defined below) of Milgray Electronics, Inc., a
New York corporation. Capitalized terms used herein and not otherwise defined
herein shall have the meaning assigned to them in the offer to purchase dated
December 4, 1996 ("Offer to Purchase") referred to in Item 2 hereof.

ITEM 1. SECURITY AND SUBJECT COMPANY.

     The name of the subject company is Milgray Electronics, Inc., a New York
corporation (the "Company"). The address of the principal executive office of
the Company is 77 Schmitt Boulevard, Farmingdale, New York 11735. The title of
the class of equity securities to which this Statement relates is the common
stock, par value $.25 per share (the "Shares") of the Company.

ITEM 2. TENDER OFFER OF THE BIDDER.

     This Statement relates to the tender offer (the "Offer") disclosed in the
Schedule 14D-l dated December 4, 1996 (as amended or supplemented, "Schedule
14D-l") filed with the Securities and Exchange Commission (the "Commission") by
Bell Industries, Inc., a California corporation ("Parent" or "Bell") and its
wholly owned subsidiary ME Acquisition, Inc., a New York corporation (the
"Purchaser") relating to an offer by the Purchaser to purchase all outstanding
Shares at $14.77 per share, net to the seller in cash, without interest (the
"Offer Price") upon the terms and subject to the conditions set forth in the
Offer to Purchase and the related letter of transmittal ("Letter of
Transmittal"), copies of which are filed as Exhibits (a)(1) and (a)(2) hereto,
respectively. The principal executive offices of each of the Purchaser and
Parent are located at 11812 San Vicente Boulevard, Los Angeles, CA 90049-5022.

     The Offer is being made pursuant to the Agreement and Plan of Merger dated
as of November 26, 1996 (the "Merger Agreement"), by and among the Company, Bell
and the Purchaser. A copy of the Merger Agreement is filed as Exhibit (c)(1) to
this Schedule 14D-9 and is incorporated herein by reference in its entirety.
Pursuant to the Merger Agreement, as soon as practicable following the
consummation of the Offer and the satisfaction or waiver of certain conditions,
the Purchaser will be merged with and into the Company (the "Merger"), with the
Company continuing as the surviving corporation (the "Surviving Corporation").
In the Merger each Share outstanding at the Effective Time (other than Shares
held in the treasury of the Company, Shares owned by Bell, the Purchaser or any
other subsidiary of Bell or the Company or Shares owned by stockholders who
properly exercise their dissenters' rights under the New York Business
Corporation Law [the "BCL"]) will by virtue of the Merger and without any action
of the holder thereof, be converted into the right to receive $14.77 per Share,
net to the Seller in cash, without interest thereon (the "Merger
Consideration"), upon the surrender of the certificate formerly representing
such Share (the "Certificate"). The Merger Agreement is summarized in Item 3 of
this Schedule 14D-9.

ITEM 3. IDENTITY AND BACKGROUND.

     (a) The name and business address of the Company (which is the person
filing this Statement) are set forth in Item I above. Unless the context
otherwise requires, references to the Company in this Schedule 14D-9 are to the
Company and its subsidiaries, viewed as a single entity.

     (b) The Company is a party to the Merger Agreement and Confidentiality
Agreement with the Parent and/or Purchaser; and directors and/or executive
officers of the Company are parties to agreements and arrangements summarized
below relating to or arising out of transactions contemplated by the Merger
Agreement or the Merger.


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                              THE MERGER AGREEMENT

     The following summary of the Merger Agreement is qualified in its entirety
by reference to the Merger Agreement, a copy of which is filed as Exhibit (c)(l)
to this Schedule 14D-9 and is incorporated herein by reference in its entirety.

     The Offer. The Merger Agreement provides that Purchaser will commence the
Offer and that, upon the terms and subject to the prior satisfaction or waiver
of the conditions of the Offer, Purchaser will accept for payment and pay for
Shares tendered as soon as practicable after it is legally permitted to do so
under applicable law, subject to the restriction set forth in the next
succeeding sentence. The Merger Agreement provides that, without the written
consent of the Company, Purchaser will not decrease the Offer Price, decrease
the number of Shares sought, change the form of the consideration to be paid in
the Offer, amend or waive the Minimum Condition or amend any other condition of
the Offer (other than insignificant changes or amendments) in any manner adverse
to the holders of the Shares except that if on the initial scheduled Expiration
Date all conditions of the Offer have not been satisfied or waived, the Offer
may be extended from time to time without the consent of the Company until
February 6, 1997, or if the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976 ("HSR Act") has not expired or terminated by February
6, 1997, until February 28, 1997. The Merger Agreement also provides that,
without the written consent of the Company, the Purchaser will not accept for
payment and pay for any Shares prior to January 7, 1997. In addition, the Merger
Agreement provides that, without the consent of the Company, the Offer Price may
be increased and the Offer may be extended to the extent required by law in
connection with such an increase.

     The Merger. The Merger Agreement provides that subject to the terms and
conditions thereof, and pursuant to New York Law, at the Effective Time
Purchaser will be merged with and into the Company. As a result of the Merger,
the separate corporate existence of Purchaser will cease and the Company will
continue as the Surviving Corporation.

     The respective obligations of Parent and Purchaser, on the one hand, and
the Company, on the other hand, to effect the Merger are subject to the
conditions that: (i) all authorizations, consents, orders or approvals of, or
declarations or filings with, or expiration of waiting periods imposed by, any
Federal, state, local or foreign governmental or regulatory authority necessary
for the consummation of the Merger and the transactions contemplated by the
Merger Agreement will have been filed, occurred or been obtained and will be in
effect at the Effective Time; (ii) no temporary restraining order, preliminary
injunction or permanent injunction or other order precluding, restraining,
enjoining, preventing or prohibiting the consummation of the Merger will have
been issued by any Federal, state or foreign court or other governmental or
regulatory authority and remain in effect; (iii) no Federal, state, local or
foreign statute, rule or regulation will have been enacted which prohibits the
consummation of the Merger or would make the consummation of the Merger illegal;
and (iv) the Merger Agreement will have been approved and adopted by the
affirmative vote required of the shareholders of the Company, if required
pursuant to the Company's articles of incorporation and applicable New York Law
in order to consummate the Merger. In addition, the obligations of the Company
to effect the Merger are also subject to the satisfaction or waiver, on or prior
to the date of the closing of the Merger (the "Closing Date"), of the additional
condition that Parent, Purchaser or their affiliates will have purchased Shares
(including without limitation the Shares subject to the Tender Agreement)
pursuant to the Offer.

     The Merger Agreement provides that at the Effective Time, each issued and
outstanding Share (other than Shares that are owned by the Company as treasury
stock and any Shares owned by Parent, Purchaser or any other wholly owned
subsidiary of Parent) will be converted into the right to receive the Offer
Price, without interest.

     Pursuant to the Merger Agreement, each issued and outstanding share of
common stock of Purchaser will be converted into one fully paid and
nonassessable share of common stock of the Surviving Corporation.

     The Company's Board of Directors. The Merger Agreement provides that
promptly upon the purchase of and payment for any Shares (including without
limitation all Shares subject to the Tender Agreement) by Purchaser or any other
subsidiary of Parent pursuant to the Offer, Parent will be entitled to designate
such


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number of directors, rounded to the nearest whole number, on the Board as is
equal to the product of the total number of directors then serving on the Board
(which, immediately prior to such calculation, may not consist of more than five
directors) multiplied by the ratio of the aggregate number of Shares
beneficially owned by Parent, Purchaser and any of their affiliates to the total
number of Shares then outstanding. The Company must, upon request of Purchaser,
take all action necessary to cause Parent's designees to be elected or appointed
to the Board, including without limitation securing the resignations of such
number of its incumbent directors as is necessary to enable Parent's designees
to be so elected or appointed to the Board, and must cause Parent's designees to
be so elected or appointed. Purchaser has advised the Company that it is
Purchaser's expectation that those individuals so elected or appointed to the
Board will not receive any compensation for services rendered in such capacity.
At such time, the Company will also cause persons designated by Parent to
constitute the same percentage (rounded to the nearest whole number) as is on
the Board of (i) each committee of the Board, (ii) each board of directors (or
similar body) of each subsidiary of the Company and (iii) each committee (or
similar body) of each such board.

     The Merger Agreement further provides that the Company will promptly take
all actions required pursuant to Section 14(f) of the Exchange Act and Rule
14f-l promulgated thereunder, including mailing to shareholders as part of the
Company's Schedule 14D-9 the information required by such Section 14(f) and Rule
14f-l as is necessary to enable Parent's designees to be elected to the Board.
From and after the time, if any, that Parent's designees constitute a majority
of the Board, any amendment of the Merger Agreement, any termination of the
Merger Agreement by the Company, any extension of time for performance of any of
the obligations of Parent or Purchaser thereunder, any waiver of any condition
or any of the Company's rights thereunder or other action by the Company
thereunder (other than as specifically provided in the Merger Agreement) may be
effected only if the action is approved by a majority of the directors of the
Company then in office who were directors of the Company on the date of the
Merger Agreement; provided that, if there will be no such directors, such
actions may be effected by majority vote of the entire Board.

     Shareholders Meeting. Pursuant to the Merger Agreement, the Company will,
if required by applicable law in order to consummate the Merger: (i) duly call,
give notice of, convene and hold a special meeting of its shareholders (the
"Special Meeting") as soon as practicable following the acceptance for payment
and purchase of Shares by Purchaser pursuant to the Offer for the purpose of
considering and taking action upon the Merger Agreement; (ii) prepare and file
with the Commission a preliminary proxy or information statement relating to the
Merger and the Merger Agreement and use its reasonable efforts (x) to obtain and
furnish the information required to be included by the Commission in the Company
Proxy Statement and, after consultation with Parent, to respond promptly to any
comments made by the Commission with respect to the preliminary proxy or
information statement and cause a definitive proxy or information statement (the
"Company Proxy Statement") to be mailed to its shareholders and (y) to obtain
the necessary approvals of the Merger and the Merger Agreement by its
shareholders; and (iii) include in the Company Proxy Statement the
recommendation of the Board of Directors that shareholders of the Company vote
in favor of the approval of the Merger and the adoption of the Merger Agreement
(provided that shareholders should consult with their financial or tax advisers
prior to voting to approve the Merger) unless, in the opinion of the Board of
Directors after consultation with independent counsel, the inclusion of such
recommendation would be inconsistent with its fiduciary duties under applicable
law. Purchaser has agreed that it will, and will cause any of its permitted
assignees to, vote all of the Shares then owned by it which are entitled to vote
in favor of the approval of the Merger and the adoption of the Merger Agreement.

     The Merger Agreement provides that in the event Purchaser acquires at least
90% of the outstanding Shares, the parties will take all necessary and
appropriate action to cause the Merger to become effective as soon as
practicable after such acquisition without approval of the Company shareholders.

     Interim Operations. In the Merger Agreement, the Company has agreed that,
except as expressly contemplated therein or as agreed in writing by Parent,
after the date of the Merger Agreement and prior to the time the directors of
the Purchaser have been elected to the Board, that the business of the Company
and its subsidiaries will be carried on in the usual, regular and ordinary
course, in substantially the same manner as previously conducted. The Merger
Agreement sets forth various specific actions related to the conduct of its


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business which the Company is prohibited or restricted from taking during this
period and other actions which the Company is required to take during this
period.

     No Solicitation. In the Merger Agreement, the Company has agreed that the
Company and its subsidiaries and affiliates will not, and will use their
reasonable efforts to ensure that their respective officers, directors,
employees, investment bankers, attorneys, accountants and other representatives
and agents do not, directly or indirectly, initiate, solicit, encourage or
participate in, or provide any information to any person concerning, or take any
action to facilitate the making of, any offer or proposal which constitutes or
reasonably likely to lead to any Acquisition Proposal (as hereinafter defined)
of the Company or any subsidiary or affiliate or an inquiry with respect
thereto. The Company has agreed and will cause its subsidiaries and affiliates,
and their respective officers, directors, employees, investment bankers,
attorneys, accountants and other agents to, immediately cease and cause to be
terminated all existing activities, discussions and negotiations, if any, with
any parties conducted heretofore with respect to such matters. Nonetheless, the
Company may, directly or indirectly, provide access and furnish information
concerning its business, properties or assets to any corporation, partnership,
person or other entity or group pursuant to an appropriate confidentiality
agreement, and may negotiate and participate in discussions and negotiations
with such entity or group concerning an Acquisition Proposal (x) if such entity
or group has submitted a bona fide written proposal to the Board relating to any
such transaction and (y) if, in the opinion of the Board after consultation with
independent legal counsel to the Company, the failure to provide such
information or access or to engage in such discussions or negotiations would be
inconsistent with their fiduciary duties under applicable law.

     The Company is required to promptly notify Parent and Purchaser of any such
offers, proposals or Acquisition Proposals (including without limitation the
terms and conditions thereof and the identity of the person making it), and is
further required to keep Parent apprised of all developments with respect to any
such Acquisition Proposal. The Company is further required to give Parent
written notice of any Acquisition Proposal that the Company intends to accept as
an Acceptable Offer in accordance with the terms of the Merger Agreement at
least two business days prior to accepting such offer or otherwise entering into
any agreement or understanding with respect thereto. Any modification of an
Acquisition Proposal constitutes a new Acquisition Proposal for purposes of
these provisions of the Merger Agreement.

     Nothing in the Merger Agreement prohibits the Company or its Board from (a)
taking and disclosing to the Company's shareholders a position with respect to a
tender offer by a third party pursuant to Rules 14d-9 and 14e-2 under the
Exchange Act, or (b) making such disclosure to the Company's shareholders which,
in the opinion of the Board, after consultation with independent legal counsel
to the Company, may be required under applicable law. "Acquisition Proposal"
when used in connection with any person means any tender or exchange offer
involving such person, any proposal for a merger, consolidation or other
business combination involving such person or any subsidiary of such person, any
proposal or offer to acquire in any manner a substantial equity interest in, or
a substantial portion of the business or assets of, such person or any
subsidiary of such person, any proposal or offer with respect to any
recapitalization or restructuring with respect to such person or any subsidiary
of such person or any proposal or offer with respect to any other transaction
similar to any of the foregoing with respect to such person, or any subsidiary
of such person; provided, however, that, as used in the Merger Agreement, the
term "Acquisition Proposal" does not apply to (i) any transaction of the type
described in Section 6.1(d) of the Merger Agreement involving Parent, Purchaser
or their affiliates. "Acceptable Offer" means an executed written offer for an
Acquisition Proposal received by the Company (i) in which the offeror
demonstrates proof reasonably satisfactory to the Company's Board of Directors
of its financial capability and authority to consummate the transactions
contemplated by such offer (including without limitation the payments required
by Section 9.1(b) of the Merger Agreement) and (ii) which provides for (x) net
cash proceeds to the Company or all of its shareholders (in addition to amounts
paid pursuant to clause (i) above) in an amount greater than that provided for
under the Merger Agreement, at a per Share purchase price greater than that
contained thereunder (or, in the event such amount has been increased by Parent
in the Merger Agreement, such greater amount) or (y) the issuance of publicly
traded stock as the consideration payable to the Company or all of its
shareholders (in addition to amounts paid pursuant to clause (i) above) which
has an established market value in excess of the per Share purchase price


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contained herein (or, in the event such amount has been increased by Parent in
the Merger Agreement, such greater amount).

     Directors' and Officers' Indemnification. The by-laws of the Surviving
Corporation in effect on the date of the Merger Agreement may not be amended,
replaced or modified up to a date which is six years from the Effective Time in
any manner which would adversely affect the rights of individuals who on the or
at any time prior to the Effective Time were directors, officers, employees or
agents of the Company unless such modification is required by law. For six years
after the earlier of (i) the date on which the Parent Designees have been
elected to the Board of Directors of the Company pursuant to Section 3.1 of the
Merger Agreement and constitute a majority of the members thereof or (ii) the
Effective Time, Parent shall and shall cause the Surviving Corporation to
indemnify the present and former officers, directors, employees or agents of the
Company or its subsidiaries against losses, claims, damages, liabilities, fees
and expenses including reasonable fees and disbursements of counsel and
judgments, fines, losses, claims, liabilities and amounts paid in settlement
(provided that the settlement is effected with the prior written consent of
Parent or the Surviving Corporation, which consent shall not be unreasonably
withheld) arising out of actions or omissions occurring at or prior to the
Effective Time (including without limitation matters arising out of or
pertaining to the transactions contemplated by the Merger Agreement) to the full
extent permitted under New York law or the Company's certificate of
incorporation or by-laws in effect at the date of the Merger Agreement. In
addition, Parent and the Surviving Corporation are required to honor and fulfill
the obligations of the Company under indemnification agreements with the
Company's directors and officers existing at or within five business days of the
date of the Merger Agreement which are listed in a schedule to the Merger
Agreement and have been delivered to Parent and Purchaser in accordance with the
Merger Agreement. The Merger Agreement also provides that the Company's
Directors' and Officers' Liability Insurance which is in effect on the date of
the Merger Agreement will be maintained through the Effective Time, at which
time the Parent shall or shall cause the Surviving Corporation to purchase and
pay for runoff coverage for a six-year term covering those persons who are
currently covered by the Company's Directors' and Officers' Liability Insurance
Policy with coverages and terms substantially similar to those now applicable.

     Benefit Plans and Certain Contracts and Employment Arrangements. The Merger
Agreement provides that it is Parent's current intention to cause the Company to
provide its employees for at least two years following the Effective Time in
general with employee benefit arrangements providing welfare benefits
substantially comparable in the aggregate to those provided by the Company as of
the date of the Merger Agreement, except for any changes thereto that may be
required by law, provided that Parent has retained the right to amend, modify or
terminate any employee benefit policy or arrangement maintained by the Company
to the extent not prohibited by the terms thereof or by applicable law.

     Simultaneously with the closing of the Merger Agreement, Parent entered
into employment agreements with the Selling Shareholder and Richard Hyman and
the Company and Parent entered into employment agreements with each of John
Tortorici, Andrew Epstein, James Darren O'Donnell, Steven Sokoloff, Gary Adams,
Elliott Schnabel and Thomas Woolf (collectively with Mr. Hyman, the "Key
Officers"), such agreements to be effective as of the Effective Time. The
Selling Shareholder's employment agreement provides that the Selling Shareholder
will be employed for a one-year term as Vice Chairman of the Board and an
Assistant Secretary of Parent at a salary of $100,000 per year, with automatic
one-year extensions at a nominal salary (to be set by Parent) sufficient to
enable the Selling Shareholder to participate in Parent's medical insurance
plan. Mr. Hyman's employment agreement provides that Mr. Hyman will be employed
for a five-year term as President of the Company and Executive Vice President
Electronics Distribution Group of Parent at a base salary of $400,000 plus a
guaranteed minimum incentive bonus of $135,000 per year. Mr. John Tortorici's
employment agreement provides that Mr. Tortorici will be employed for a
three-year term as Vice President - Finance and Treasurer of the Company at a
base salary of $175,000 per year plus a guaranteed minimum incentive bonus of
$70,000 per year. Mr. Elliott Schnabel's employment agreement provides that Mr.
Schnabel will be employed for a three-year term as a Regional Vice President -
Sales of the Company at a base salary of $200,000 per year plus a guaranteed
minimum incentive bonus of $80,000 per year. Mr. Thomas Woolf's employment
agreement provides that Mr. Woolf will be employed for a three-year term as a
Regional Vice President - Sales of the Company at a base salary of $175,000 per
year plus a


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guaranteed minimum incentive bonus of $56,000 per year. Mr. Gary Adams'
employment agreement provides that Mr. Adams will be employed for a three-year
term as a Regional Vice President - Sales of the Company at a base salary of
$150,000 per year plus a guaranteed minimum incentive bonus of $61,000 per year.
Mr. Steven Sokoloff's employment agreement provides that Mr. Sokoloff will be
employed for a three-year term as a Vice President - Marketing of the Company at
a base salary of $250,000 per year plus a guaranteed minimum incentive bonus of
$94,000 per year. Mr. James Darren O'Donnell's employment agreement provides
that Mr. O'Donnell will be employed for a three-year term as a Vice President -
Marketing of the Company at a base salary of $225,000 per year plus a guaranteed
minimum incentive bonus of $75,000 per year. Mr. Andrew Epstein's employment
agreement provides that Mr. Epstein will be employed for a three-year term as
Vice President - Operations of the Company at a base salary of $175,000 per year
plus a guaranteed minimum incentive bonus of $66,000 per year. In addition, each
of the Key Officers will be awarded Incentive Stock Options to acquire 10,000
shares of common stock of Parent (25,000 shares in the case of Mr. Hyman) under
Parent's Stock Option Plan pursuant to a stock option agreement to be entered
into upon effectiveness of their respective employment agreements. Each Key
Officer will also be entitled to participate in all of Parent's employee benefit
plans listed in Parent's employee handbook, as the same may change from time to
time, and, in addition, to participate on the same terms as senior Parent
executives in any benefit plans available to members of Parent's management
(whether or not listed in the employee handbook). Copies of the forms of such
Employment Agreements are set forth in Exhibit 6.8(b) to the Merger Agreement,
which is filed as Exhibit (c)(1) to this Schedule 14D-9.

     Election of Directors. Parent will, immediately after the Effective Time,
cause the Selling Shareholder to be elected to Parent's Board of Directors.

     Representations and Warranties. The Company has made customary
representations and warranties to Parent and Purchaser.

     Termination; Expenses. The Merger Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time, whether before
or after shareholder approval thereof:

          (i) by mutual consent of the Board of Directors of Parent and the
     Board of Directors of the Company;

          (ii) by either the Board of Directors of Parent or the Board of
     Directors of the Company: (a)(i) if all conditions to the Offer shall not
     have been satisfied or waived within the relevant time period specified in
     Section 1.1(a) of the Merger Agreement, (ii) if all such conditions have
     been so satisfied or waived and the Purchaser shall not have accepted for
     purchase and purchased all Shares validly tendered and not withdrawn prior
     to the Expiration Date of the Merger Agreement within ten business days
     following such Expiration Date; or (iii) if the Merger shall not have been
     consummated on or prior to May 31, 1997; provided, however, that the right
     to terminate the Merger Agreement as described in this clause (i) shall not
     be available to any party whose failure to fulfill any material obligation
     under the Merger Agreement has been the cause of, or resulted in, the
     failure of the Offer or the Merger, as applicable, to be consummated on or
     prior to the applicable dates or (ii) if a court of competent jurisdiction
     or other governmental or regulatory authority will have issued an order,
     decree or ruling or taken any other action (which order, decree, ruling or
     other action the parties hereto will use their reasonable efforts to lift),
     in each case permanently restraining, enjoining or otherwise prohibiting
     the transactions contemplated by the Merger Agreement and such order,
     decree, ruling or other action will have become final and nonappealable;

          (iii) by the Board of Directors of the Company: (a) if, prior to the
     purchase of Shares by Parent, Purchaser or their affiliates pursuant to the
     Offer, the Company will have (A) accepted an Acceptable Offer in compliance
     with the terms of Section 6.1 of the Merger Agreement and (B) paid or
     caused to be paid the expenses payable to Parent provided for in Section
     9.1(b) of the Merger Agreement; or (b) if, prior to the purchase of the
     Shares pursuant to the Offer, Parent or Purchaser breaches or fails in any
     material respect to perform or comply with any of its material covenants
     and agreements contained therein or breaches its representations and
     warranties in any material respect; or (c) if Parent, Purchaser or any of
     their affiliates will have failed to commence the Offer on or prior to five
     business days following


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     the date of the initial public announcement of the Offer other than due to
     an occurrence that if occurring after the commencement of the Offer would
     result in a failure to satisfy any of the conditions described in Section
     14 of the Offer to Purchase; provided that the Company may not terminate
     the Merger Agreement as described in this clause (c) if the Company is in
     material breach of the Merger Agreement; or (d) if prior to the purchase of
     Shares pursuant to the Offer, there shall have been instituted, pending or
     threatened any action, suit or proceeding which challenges, seeks to make
     illegal, prohibits or makes illegal the acceptance for payment, payment for
     or purchase of Shares or the consummation of the Offer or the Merger and
     which, in the opinion of independent counsel acceptable to the parties
     (consent not be unreasonably withheld), has reasonable possibility of
     success.

          (iv) by the Board of Directors of Parent: (a) if, due to an occurrence
     that if occurring after the commencement of the Offer would result in a
     failure to satisfy any of the conditions described in Section 14 of the
     Offer to Purchase, Parent, Purchaser, or any of their affiliates will have
     failed to commence the Offer on or prior to the Offer Deadline; provided
     that Parent and Purchaser may not terminate the Merger Agreement as
     described in this clause (a) if Parent or Purchaser (x) is in material
     breach of the Merger Agreement; or (y) has not exercised such right by the
     close of business on or before the fifth business day following the Offer
     Deadline; (b) if Parent or Purchaser is not in material breach of the
     Merger Agreement and prior to the purchase of Shares pursuant to the Offer,
     the Company will have received an Acceptable Offer and the Board of
     Directors of the Company will have withdrawn, or modified or changed
     (including by amendment of the Schedule 14D-9) in a manner adverse to
     Parent or Purchaser its approval or recommendation of the Offer, the Merger
     Agreement or the Merger or will have recommended an Acquisition Proposal,
     provided, however, that if the Company's Board of Directors modifies or
     changes its recommendation of the Offer, this Agreement or the Merger to
     either express no opinion and remain neutral with respect thereto, or to
     provide that it is unable to take a position with respect thereto, such
     modification or change will not be deemed to be adverse to Parent or
     Purchaser for purposes of this clause (b); (c) if Parent or Purchaser, as
     the case may be, will have terminated the Offer, or the Offer will have
     expired without Parent or Purchaser, as the case may be, purchasing any
     Shares thereunder, provided that Parent and Purchaser may not terminate the
     Merger Agreement as described in this clause (c) if (x) it or the Purchaser
     has failed to purchase the Shares in the Offer in violation of the material
     terms thereof or (y) Parent or Purchaser has not exercised such right by
     the close of business on or before the fifth business day following the
     termination or expiration of the Offer in accordance with its terms; or (d)
     if, prior to the purchase of the Shares pursuant to the Offer, the Company
     breaches or fails in any material respect to perform or comply with any of
     its material covenants and agreements contained in the Merger Agreement or
     breaches its representations and warranties in any material respect.

     If (i) the Board of Directors of the Company terminates the Merger
Agreement because the Company has accepted an Acceptable Offer under certain
conditions prior to the later of the purchase of Shares under the Offer or the
scheduled expiration date for tender offer, (ii) the Board of Directors of
Parent terminates the Merger Agreement if the Company has received an Acceptable
Offer and withdrawn or adversely changed its recommendation of the transaction
under certain circumstances, or (iii) the Board of Directors of Parent
terminates the Merger Agreement if Parent, Purchaser or any of their affiliates
will have failed to commence the Offer by five business days after announcement
of the Merger Agreement under certain circumstances or if Parent or Purchaser
will have terminated the Offer or the Offer will have expired without Parent or
Purchaser purchasing any Shares under certain conditions, in each case due to
(x) a material breach of the representations and warranties of the Company set
forth in the Merger Agreement or (y) a material breach of, or failure of the
Company to perform or comply with, any material obligation, agreement or
covenant contained in the Merger Agreement, then in any such case as described
in clause (i), (ii) or (iii) the Company shall be required to reimburse Parent
for all of its fees and expenses incurred in connection with the Offer and the
Merger Agreement and the transactions contemplated thereby. Any such amounts
must be paid by the Company concurrently with the termination of the Merger
Agreement in the case of a termination referred to in clause (i) and otherwise
not later than two business days after termination of the Merger Agreement (or,
if later, after Parent provides reasonable documentation to the Company of the
amount of 


                                       7

<PAGE>

such fees and expenses). Any such fees and expenses not paid when due shall
accrue interest at the rate of ten percent per annum from the due date until
paid in full.

     If (i) the Board of Directors of the Company terminates the Merger
Agreement prior to the purchase of any Shares pursuant to the Offer because
Parent or Purchaser breaches or fails in any material respect to perform or
comply with any of its material covenants and agreements contained in the Merger
Agreement or breaches its representations and warranties contained therein in
any material respect or (ii) Parent is unable to obtain the financing necessary
to satisfy the Financing Condition (other than because of (a) the occurrence of
any event that would result in a failure to satisfy any of the conditions of the
Offer (see Section 14 of the Offer to Purchase) (and for this purpose only,
disregarding the provisos to the condition set forth in paragraph (d) of said
Section 14), or (b) the occurrence of a Material Adverse Effect with respect to
Parent and its consolidated subsidiaries, whether such event or Material Adverse
Effect occurs before or after commencement of the Offer), then Parent shall be
required to reimburse the Company for all of its fees and expenses incurred in
connection with the Offer and the Merger Agreement and the transactions
contemplated thereby, such reimbursement to occur not later than two business
days after termination of the Merger Agreement (or, if later, after the Company
provides reasonable documentation to Parent of the amount of such fees and
expenses) Any such fees and expenses not paid when due shall accrue interest at
the rate of ten percent per annum from the due date until paid in full.

     Appraisal Rights. Notwithstanding anything in the Merger Agreement to the
contrary, any issued and outstanding Shares held by persons who object to the
Merger and comply with all the provisions of New York Law concerning the right
of holders of Shares to dissent from the Merger and require appraisal of their
Shares ("Dissenting Shareholder") will not be converted into the right to
receive the Offer Price, without interest, pursuant to the Merger Agreement but
will become the right to receive such consideration as may be due to such
Dissenting Shareholder pursuant to New York Law; provided, however, that the
Shares outstanding immediately prior to the Effective Time and held by a
Dissenting Shareholder who will, after the Effective Time, fail to perfect his
right to appraisal, withdraw his demand for appraisal, or lose his right of
appraisal, in any case pursuant to Section 623 of the New York Law, will be
deemed to be converted as of the Effective Time into the right to receive the
Offer Price, payable to the holder thereof, without interest. The Company will
give Parent (i) prompt notice of any written demands for appraisal of the Shares
received by the Company and (ii) the opportunity to direct all negotiations and
proceedings with respect to any such demands. The Company will not, without the
prior written consent of Parent, voluntarily make any payment with respect to,
or settle, offer to settle or otherwise negotiate, any such demands.

     Conditions of the Offer. Purchaser's obligations to accept for payment or
pay for Shares are subject, among other things, to (i) expiration and
termination of the applicable waiting period under the HSR Act, (ii)
satisfaction or waiver of the Minimum Condition, and (iii) satisfaction or
waiver of the financing condition and (iv) the occurrence at any time on or
after the date of the Merger Agreement of various events set forth in Annex A to
the Merger Agreement (or the determination by Purchaser that any of such events
shall have occurred).

                           INDEMNIFICATION AGREEMENTS

     The Company has entered into indemnification agreements with each person
who as of November 26, 1996 was either an executive officer or director of the
Company. The indemnification agreements provide generally (i) for
indemnification against all costs and expenses (including attorneys' fees)
actually and reasonably incurred in connection with the investigation or defense
of any threatened, pending or expired litigation related to such indemnitee's
service to the Company in certain capacities and against all judgments, fines
and amounts paid in settlement of any claim, unless it is determined that such
indemnification is not permitted under applicable law or as a result of certain
culpable action by such indemnitee and (ii) for the prompt advancement of
expenses to an indemnitee as well as the reimbursement by such indemnitee of any
such advances to the Company if it is determined that the indemnitee is not
entitled to such indemnification. Indemnitee's rights under the indemnification
agreements are not exclusive of any other rights indemnitee may have under the
BCL, the Company's by-laws or otherwise. A copy of the form of indemnification


                                        8

<PAGE>

agreement referred to in this paragraph has been filed as Exhibit (c)(2) to this
Schedule 14D-9 and is incorporated herein by reference in its entirety.

     Article Tenth of the certificate of incorporation of the Company, as
amended to date, limits the personal liability of directors of the Company. A
copy of such Article Tenth has been filed as Exhibit (c)(3) to this Schedule
14D-9 and is incorporated herein by reference in its entirety. Article IX,
Section 1, of the Company's by-laws provides, among other things, for mandatory
indemnification of the Company's directors and officers and advance payment of
expenses incurred by an indemnitee in defending various actions by reason of the
fact that such indemnitee was a director or officer of the Company, upon receipt
of an undertaking by or on behalf of such director or officer to repay such
amount if and to the extent that it shall ultimately be determined that such
indemnitee is not entitled to be indemnified by the Company under relevant
sections of the New York Business Corporation Law. Article IX, Section 1, of the
Company's by-laws has been filed as Exhibit (c)(4) to this Schedule 14D-9 and is
incorporated herein by reference in its entirety. The Company has in effect a
directors' and officers' liability insurance policy covering, among other
things, various claims against officers and directors as set forth in said
policy.

                            CONFIDENTIALITY AGREEMENT

     The Parent entered into a confidentiality agreement, dated September 17,
1996, with the Company (the "Confidentiality Agreement"), pursuant to which
Parent has agreed, among other things, to keep confidential certain non-public,
confidential or proprietary information of the Company furnished to Parent by or
on behalf of the Company. A copy of the Confidentiality Agreement is filed with
this Statement as Exhibit (c)(5) and incorporated herein by reference in its
entirety.

                                TENDER AGREEMENT

     The following summary of the Tender Agreement is qualified in its entirety
by reference to the Tender Agreement, a copy of which is filed as Exhibit (c)(6)
to this Schedule 14D-9 and which is incorporated herein in its entirety.

     Tender of Shares. In connection with the execution of the Merger Agreement,
Parent, Purchaser and Selling Shareholder entered into the Tender Agreement.
Upon the terms and subject to the conditions of such agreement, the Selling
Shareholder has agreed (i) to validly tender or cause the record owner of any
Shares beneficially owned by the Selling Shareholder to tender all such Shares
pursuant to the Offer not later than December 10, 1996 or, with respect to any
Shares acquired directly or indirectly, or otherwise beneficially owned, by the
Selling Shareholder in any capacity after November 26, 1996 and prior to the
termination of the Tender Agreement, whether upon the exercise of options,
warrants or rights, the conversion or exchange of convertible or exchangeable
securities, or by means of a purchase, dividend, distribution, gift, bequest,
inheritance or as a successor-in-interest in any capacity (including a fiduciary
capacity) or otherwise ("After-Acquired Shares") within one business day
following the acquisition thereof, and (ii) not to withdraw any Shares so
tendered without the prior written consent of Parent. The Selling Shareholder
has agreed that Purchaser's obligation to accept for payment and pay for the
Shares in the Offer is subject to the terms and conditions of the Offer.

     Non-Competition; Nondisclosure. The Selling Shareholder has agreed that for
a period of three years from the date of the sale of the Shares, or, if longer,
while the Selling Shareholder is a director, officer or employee of Bell, he
will not compete with the Company or solicit employees or customers of the
Company, and that he will not disclose trade secrets or other confidential
information of the Company. Notwithstanding the foregoing, at any time after the
initial three-year period, the Selling Shareholder may compete with the Company
or solicit employees of the Company with the express written consent of Parent,
which will not be unreasonably withheld.

     Voting. The Selling Shareholder has agreed that (for so long as the Merger
Agreement is in effect), at any meeting of the holders of the Shares, however
called, or in connection with any written consent of the holders of the Shares,
he will vote (or cause to be voted) his Shares (a) in favor of the Merger, the
execution


                                        9
<PAGE>

and delivery by the Company of the Merger Agreement and the approval of the
terms thereof and each of the other actions contemplated by the Merger Agreement
and the Tender Agreement and any actions required in furtherance thereof; (b)
against any action or agreement that would result in a breach of any obligation
or agreement of the Company under the Merger Agreement or the Tender Agreement;
and (c) except as otherwise agreed to in writing in advance by Parent, against
any of the following actions or agreements (other than the Merger Agreement or
the transactions contemplated thereby): (i) any action or agreement that is
intended, or could reasonably be expected, to impede, interfere with, delay,
postpone or attempt to discourage or adversely affect the Merger, the Offer and
the transactions contemplated by the Tender Agreement and the Merger Agreement;
(ii) any extraordinary corporate transaction, such as a merger, consolidation or
other business combination involving the Company and its subsidiaries; (iii) a
sale, lease or transfer of a material amount of assets of the Company or its
subsidiaries; (iv) any change in the management or the Board of Directors of the
Company, except as specifically contemplated by the Merger Agreement; (v) any
change in the present capitalization or dividend policy of the Company; (vi) any
amendment of the Company's articles of incorporation or by-laws; or (vii) any
other material change in the Company's corporate structure or business. Any such
vote or consent shall be given in accordance with such procedures relating
thereto as shall ensure that it is duly counted for purposes of determining that
a quorum is present and for purposes of recording the results of such vote or
consent. Notwithstanding anything to the contrary contained in the Tender
Agreement, the Selling Shareholder will be free to act in his capacity as a
member of the Board of Directors of the Company and to discharge his fiduciary
duties as such.

                           INVESTMENT BANKING SERVICES

     In October 1996, the Company retained Carl Marks & Co., Inc. ("Carl Marks")
to provide investment banking services and to explore all options to recognize
the greatest value for the Company's shareholders. The Company agreed to pay to
Carl Marks for such services a fee of $175,000 upon consummation of the sale of
all or at least two-thirds of the Company's common stock. The Company has also
agreed to indemnify Carl Marks against certain liabilities, including
liabilities arising under the Federal securities laws. Mr. Robert Davidoff, a
director of the Company, is a vice president of Carl Marks. A copy of the
engagement letter between the Company and Carl Marks is filed with this
Statement as Exhibit (c) (7) and is incorporated herein by reference in its
entirety.

                         VOTE REQUIRED TO APPROVE MERGER

     New York Law provides that the adoption of any plan of merger or
consolidation by the Company requires the approval of the Board and the
affirmative vote of at least 66 2/3% of all outstanding shares entitled to vote
thereon (including the votes of any Shares owned by Parent and Purchaser that
have voting rights at such time), if the "short form" merger procedure described
below is not available. The Board has authorized and approved the Offer and the
Merger; consequently, the only additional action of the Company that may be
necessary to effect the Merger is approval by such shareholders at a meeting of
the Company's shareholders convened for that purpose (the "Shareholders
Meeting") if the "short form" merger procedure described below is not available.
New York Law also provides that the Merger will not require the approval of the
Company's shareholders, and can be adopted by Purchaser's Board of Directors, if
Purchaser owns at least 90% of the outstanding Shares. Accordingly, if, as a
result of the Offer or otherwise, Purchaser acquires or controls the voting
power of at least 90% of the outstanding Shares, Purchaser could, and intends
to, effect the Merger without the Shareholders Meeting and without approval by
shareholders of the Company. If, however, Purchaser does not acquire at least
90% of the then outstanding Shares pursuant to the Offer or otherwise and a vote
of the Company's shareholders is required under New York Law, a significantly
longer period of time will be required to effect the Merger. Even if the Minimum
Condition is satisfied, Purchaser will not necessarily be able to purchase
sufficient Shares in the Tender Offer in order to be able to use the "short
form" merger procedures described above.

ITEM 4. THE SOLICITATION OR RECOMMENDATION.

     (a) Recommendations of the Board of Directors. The Board of Directors of
the Company has unanimously approved the Offer and the Merger and determined
that the Offer and the Merger and the transactions contemplated thereby are fair
to and in the best interests of the Company's shareholders as a


                                       10

<PAGE>

group, provided that each shareholder should consult with his financial or tax
adviser regarding the impact thereof on such shareholder; and the Board
unanimously recommends that the shareholders of the Company, as a group, accept
the Offer, tender their Shares thereunder to Purchaser and approve and adopt the
Merger Agreement and the Merger, provided, however, that shareholders should
consult with their financial or tax adviser prior to tendering their Shares in
the Offer or voting to approve the Merger.

     (b) Background of the Offer; Reasons for the Recommendation. In March 1996,
following conversations among Parent's investment banker, Peers & Co., Richard
Hyman (Executive Vice President and a director of the Company) and Parent,
Parent presented to Herbert S. Davidson (the Chief Executive Officer and
principal stockholder of the Company) a proposal looking toward an offer by the
Parent to acquire the outstanding stock of the Company and for merger of the
Company and a subsidiary of Parent.

     Following consideration of the proposal by Mr. Davidson and Mr. Hyman, the
Parent, in a letter to the Company (the "April Letter"), presented a modified
proposal, pursuant to which the Parent would make a tender offer to the
Company's shareholders, to be followed by a merger of the Company and a
subsidiary of the Parent, subject to various conditions set forth in said
letter. The April Letter was conditioned, among other things, upon Mr. Davidson
entering into an option agreement for tendering all of his shares in the
proposed tender offer. The April Letter also contemplated the employment by the
merged company of various executives or employees of the Company.

     On April 30, 1996, representatives of the Parent and of the Company met in
New York City with a view to discussing the terms, the desirability and/or
effects of the proposed merger, the methods of operation of the merged company,
the terms of the proposed employment arrangements, and various other matters
related to the Parent's proposal. Also discussed at this meeting were the
financing arrangements of the Parent relating to the proposed transaction.

     Before and after the aforementioned meeting, various members of the
Company's Board of Directors were advised of the proposal and of the discussions
which were taking place. Thereafter, representatives of the Parent and of the
Company engaged in negotiations regarding various terms of the proposed Offer
and Merger and discussions also took place regarding a possible organizational
structure and compensation and benefits matters if the proposed Offer and Merger
were to be consummated. Representatives of the Company also were in contact with
the bank which was to coordinate the Parent's financing. In August 1996, Messrs.
Davidson and Hyman participated in a meeting at Parent's headquarters to discuss
and negotiate various matters with respect to the proposed transactions.

     In October 1996, the Company retained Carl Marks & Co., Inc. to provide
investment banking service and to explore all options to recognize the greatest
value for the Company's shareholders. In October 1996, the Board of Directors of
the Company retained Mesirow Financial, Inc. ("Mesirow") to analyze the proposed
transaction and render its opinion as to the fairness of the proposed
transaction to shareholders from a financial point of view. At the end of
October 1996, Parent and its financing bank commenced their respective due
diligence reviews of the Company.

     On November 26, 1996, the Board of Directors of the Company met to consider
and review the Parent's proposals. The terms of the proposed transactions and
related Merger Agreement were presented to and reviewed by the Board. Mesirow
made presentations to the Board and delivered its opinion that, as of November
26, 1996, the $14.77 per Share cash consideration to be received by shareholders
of the Company pursuant to the Offer is fair to the shareholders of the Company
from a financial point of view. The Board then discussed the proposed Merger
Agreement and related transactions. After discussion and further analysis, the
Board unanimously approved the Merger and made the recommendations as set forth
above in subparagraph (a) of this Item 4. Following such Board meeting, the
Company was informed that the Board of Directors of the Parent and the Purchaser
had, on November 26, 1996, approved the Merger Agreement. The Merger Agreement
was executed by the parties on November 26, 1996, and subsequently thereto, was
delivered by the parties.


                                       11
<PAGE>

     Parent and the Company, on November 27, 1996, issued a joint press release
announcing the execution of the Merger Agreement and the Tender Agreement. The
Purchaser commenced the Offer on December 4, 1996.

     In arriving at its decision regarding its recommendation set forth above,
the Board of Directors of the Company considered, among other things, (i) the
terms and conditions of the Merger Agreement, including the amount and form of
the consideration; (ii) the fact that the $14.77 per Share price represents a
premium of approximately 8.4% over the closing $13.625 per Share price as
reported on the NASDAQ National Market on November 26, 1996, the date the Board
of Directors authorized the transactions; (iii) the recent historical market
prices of the Shares; (iv) the Board of Directors' knowledge of the business,
operations, prospects, assets and earnings of the Company; (v) the effect of the
transaction on the Company's employees and customers; (vi) the commitment letter
of the financing bank regarding the financing of the Merger; (vii) the
competitive environment in the electronic distribution field as related to
perceived difficulties of the Company maintaining its position in the face of
larger, well-financed distributors; (viii) the fact that, under the Merger
Agreement, the Company is not prohibited from responding to an unsolicited
Takeover Proposal (as defined in the Merger Agreement) to acquire the Company,
to the extent that the Board of Directors of the Company determines in good
faith, after consultation with independent counsel, that it is necessary to do
so in order to comply with its fiduciary duties to the Company's shareholders;
(ix) the written opinion (the "Fairness Opinion") of Mesirow dated November 26,
1996, to the effect that, as of such date, the $14.77 in cash per Share to be
received by the holders of Shares is fair to shareholders from a financial point
of view; and (x) the statements by Mesirow representatives to the Board of
Directors at its meeting on November 26, 1996 to the effect that on the basis of
various factors described to the Board at such meeting the Offer Price is fair
to shareholders from a financial point of view. In addition, the Board of
Directors considered the presentation made to them by Mesirow, which included
Mesirow's analysis of the various factors upon which its opinion is based. The
full text of the Fairness Opinion received by the Company from Mesirow is filed
as Exhibit (a)(4) to this Schedule 14D-9 and is also attached hereto as Exhibit
(a)(4). Stockholders are urged to read such opinion in its entirety.

ITEM 5. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.

     Mesirow was retained by the Company to act as financial adviser to the
Board of Directors for the purpose of evaluating the fairness, from a financial
point of view, of the consideration to be received by shareholders pursuant to
the Offer and the Merger. The fee to be paid to Mesirow in connection with its
services is $175,000. In addition, the Company has agreed to reimburse Mesirow
for its reasonable out of pocket expenses incurred in connection with its
activities under the engagement letter (other than fees and disbursements of its
legal counsel for services in connection with the preparation of the engagement
letter and the fairness opinion). In addition to the above fees, the Company has
agreed to pay additional compensation (in an amount to be agreed upon between
the Company and Mesirow) for services requested of Mesirow by the Company in
advising the Board of Directors of the Company with respect to an offer from
another party (if made) or revised terms of the Merger in the event of such
revision. The Company has also agreed to indemnify Mesirow against certain
liabilities, including liabilities arising under the Federal securities laws.

     Except as disclosed herein, neither the Company nor any person acting on
its behalf currently intends to employ, retain or compensate any other persons
to make solicitations or recommendations to security holders on its behalf
concerning the Offer or the Merger.

ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES.

     (a) No transactions in the Shares have been effected during the past 60
days by the Company, or, to the best of the Company's knowledge, by any
executive officers, directors, affiliates or subsidiary of the Company.

     (b) Pursuant to the Tender Agreement, Herbert S. Davidson has agreed to
tender his Shares in the Offer. See Item 3. - "Identity and Background - Tender
Agreement."


                                       12

<PAGE>

ITEM 7. CERTAIN NEGOTIATIONS AND TRANSACTIONS BY SUBJECT COMPANY.

     (a) Except as set forth herein, no negotiation is being undertaken or is
under way by the Company in response to the Offer that relates to or would
result in (i) an extraordinary transaction such as a merger or reorganization
involving the Company or any subsidiary thereof, (ii) a purchase, sale or
transfer of a material amount of assets by the Company or any subsidiary
thereof, (iii) a tender offer for or acquisition of securities by or of the
Company; or (iv) any material change in the present capitalization or dividend
policy of the Company.

     (b) Except as set forth herein, there is no transaction, Board resolution,
agreement in principle or signed contract in response to the Offer that relates
to or would result in one or more of the events referred to in Item 7(a) above.

ITEM 8. ADDITIONAL MATERIAL TO BE FURNISHED.

     The Information Statement attached as Schedule A is being furnished in
connection with the possible designation by Parent (pursuant to the Merger
Agreement) of certain persons to be appointed to the Board of Directors of the
Company other than at a meeting of the Company's shareholders.

ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.

     Exhibit (a)(1)    Offer to Purchase dated December 4, 1996.

     Exhibit (a)(2)    Letter of Transmittal.

     Exhibit (a)(3)    Press release issued by the Company and Bell Industries,
                       Inc. on November 27, 1996.

     Exhibit (a)(4)    Fairness Opinion of Mesirow Financial, Inc. dated 
                       November 26, 1996. 

     Exhibit (a)(5)    Letter to Shareholders dated December 4, 1996.

     Exhibit (c)(l)    Agreement and Plan of Merger by and among Parent, 
                       Purchaser and the Company dated as of November 26, 1996.

     Exhibit (c)(2)    Form of Indemnification Agreement.

     Exhibit (c)(3)    Article Tenth of the Certificate of Incorporation of the
                       Company.

     Exhibit (c)(4)    Article IX, Section 1, of the By-laws of the Company.

     Exhibit (c)(5)    Confidentiality Agreement dated September 17, 1996.

     Exhibit (c)(6)    Tender Agreement dated as of November 26, 1996 among 
                       Parent, Purchaser and Herbert S. Davidson.

     Exhibit (c)(7)    Engagement Letter dated October 25, 1996 between the
                       Company and Carl Marks.


                                       13

<PAGE>

                                    SIGNATURE

     After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.


                                                 December 4, 1996
                                       --------------------------------------
                                                      (Date)


                                                 /s/ Richard Hyman
                                       --------------------------------------
                                                    (Signature)


                                       Richard Hyman, Executive Vice President
                                       --------------------------------------
                                                  (Name and Title)


                                       14

<PAGE>

                                                                      SCHEDULE A


                            MILGRAY ELECTRONICS, INC.
                              77 Schmitt Boulevard
                           Farmingdale, New York 11735

                        INFORMATION STATEMENT PURSUANT TO
                    SECTION 14(f) OF THE SECURITIES EXCHANGE
                     ACT OF 1934 AND RULE 14f-1 THEREUNDER.

     This Information Statement is being mailed on or about December 4, 1996, as
a part of the Solicitation/Recommendation Statement on Schedule 14D-9 (the
"Schedule 14D-9") of Milgray Electronics, Inc. (the "Company") to the holders of
record of shares of common stock, par value $.25 per share, of the Company (the
"Shares") as of the close of business on or about November 26, 1996. You are
receiving this Information Statement in connection with the possible election of
persons designated by the Parent to a majority of the seats on the Board of
Directors of the Company. The Merger Agreement requires the Company to use all
reasonable efforts to cause the Parent Designees (as defined below) to be
elected to the Board of Directors of the Company under the circumstances
described therein. See "Board of Directors and Executive Officers - Right to
Designate Directors; Parent Designees." This Information Statement is required
by Section 14(f) of the Securities Exchange Act of 1934 (the "Exchange Act") and
Rule 14f-1 thereunder. You are urged to read this Information Statement
carefully. You are not, however, required to take any action in connection with
this Information Statement. Capitalized terms used herein and not otherwise
defined herein shall have the meanings set forth in the Schedule 14D-9.

     Pursuant to the Merger Agreement, the Purchaser commenced the Offer on
December 4, 1996. The Offer is scheduled to expire at 5:00 P.M., New York City
time, on Tuesday, January 7, 1997, unless the Offer is extended.

     The information contained in this Information Statement concerning the
Parent and the Parent Designees has been furnished to the Company by the Parent,
and the Company assumes no responsibility for the accuracy or completeness of
such information.

                    BOARD OF DIRECTORS AND EXECUTIVE OFFICERS

General

     The Shares are the only class of voting securities of the Company
outstanding. Each Share has one vote. As of November 26, 1996, there were
6,773,176 Shares outstanding. The Board of Directors currently consists of five
members. Each director holds office until such director's successor is elected
and qualified or until such director's earlier resignation or removal. All
officers of the Company serve at the pleasure of the Board of Directors of the
Company.

Right to Designate Directors; Parent Designees

     Pursuant to the Merger Agreement, promptly upon the purchase of or payment
for any Shares (including, without limitation, all Shares subject to the Tender
Agreement) by Purchaser or any other subsidiary of Parent pursuant to the Offer,
Parent shall be entitled to designate such number of directors "Parent
Designees") rounded to the nearest whole number, on the Board of Directors of
the Company as is equal to the product of the total number of directors then
serving on such Board (which, immediately prior to such calculation, shall not
consist of more than five directors) multiplied by the ratio of the aggregate
number of Shares beneficially owned by Parent, Purchaser and any of their
affiliates to the total number of Shares then outstanding, and the Company
shall, upon request of Purchaser, take all action necessary to cause the Parent
Designees to be elected or appointed as directors of the Company Board of
Directors, including without limitation securing the resignations of such number
of its incumbent directors as is necessary to enable the

<PAGE>

Parent Designees to be so elected or appointed to the Company's Board of
Directors, and shall cause the Parent Designees to be so elected or appointed.
At such time, the Company shall also cause persons designated by the Parent to
constitute the same percentage, rounded to the nearest whole number, as on the
Company's Board of Directors of (i) each committee of the Company's Board of
Directors, (ii) each board of directors (or similar body) of each subsidiary of
the Company, and (iii) each committee (or similar body) of each such board.

     The Parent has informed the Company that each of the Parent Designees has
consented to act as a director. It is expected that the Parent Designees may
assume office as described above and that, upon assuming office, the Parent
Designees will thereafter constitute at least a majority of the Board of
Directors of the Company. It is further expected that none of the Parent
Designees will receive any compensation for services performed in his capacity
as director of the Company.

Parent Designees

     The Parent has informed the Company that it will choose the Parent
Designees from the directors and executive officers listed in Schedule I of the
Offer to Purchase, a copy of which is to be mailed to shareholders of the
Company together with Schedule 14D-9. The information on such Schedule I is
incorporated herein by reference. The Parent has informed the Company that none
of the Parent Designees (i) is currently a director of, or holds any position
with, the Company, (ii) has a familial relationship with any of the directors or
executive officers of the Company, or (iii) to the best of the knowledge of the
Parent, beneficially owns any securities (or rights to acquire any securities)
of the Company. The Company has been advised by the Parent that, to the best of
Parent's knowledge, none of the Parent Designees has been involved in any
transactions with the Company or any of its directors, executive officers or
affiliates which are required to be disclosed pursuant to the rules and
regulations of the Commission except as may be disclosed herein or in the
Schedule 14D-9.

Present Directors and Executive Officers

     Herbert S. Davidson, age 74, a director and President (since 1951), has
been the President and Chief Executive Officer of the Company more than five
years prior to the date hereof.

     Robert Davidoff, age 69 (who is the brother of Herbert S. Davidson and is a
member of the Audit Committee) has been a director of the Company since 1961.
Mr. Davidoff's business experience during the last five years is as follows:
Vice President of Carl Marks & Co., Inc., investment bankers, New York, New
York, for more than five years prior to the date hereof. Carl Marks & Co., Inc.
will receive a fee of $175,000 from the Company for investment banking services
to the Company. (See the Schedule 14D-9 "Investment Banking Services.") Mr.
Davidoff is presently a director of Hubco Exploration, Inc., Rex Stores, Inc.,
Consco Enterprises, Inc., Sidari Corp., Paging Partners Corp. and Marisa
Christina, Inc.

     Herschel M. Weinberg, age 69, has been a director of the Company since 1961
and Secretary of the Company since 1969, and has been a practicing attorney in
New York City for more than five years prior to the date hereof. Fees to Mr.
Weinberg for (i) legal services to the Company since the beginning of the 1996
fiscal year (October 1, 1995) amount to $303,000.00 and (ii) legal services in
respect of the Merger and related transactions amount to an additional
$350,000.00.

     Richard Hyman, age 53, has been a director of the Company since 1987,
Executive Vice President since 1987 and Vice President - Sales/Marketing since
1975.

     Leonard Gardner, age 68 (a member of the Audit Committee) has been a
director of the Company since April 1996. Mr. Gardner's business experience
during the last five years is as follows: President of Metro Accident & Health
Agency, Inc., general agent specializing in wholesale distribution of disability
income insurance and long-term care insurance.

     John Tortorici, age 57, has been Vice President - Finance since 1983 and
Treasurer of the Company since 1982.


                                       A-2

<PAGE>

Security Ownership of Management and Principal Stockholder

     The following information is furnished with respect to ownership of shares
of common stock of the Company as of November 26, 1996 by all directors, by each
executive officer named in the Summary Compensation Table and by all directors
and executive officers of the Company as a group. The persons named on the
following table have Sole voting and investment power with respect to the shares
shown as beneficially owned by them unless otherwise indicated:

      Name of                                   Number Of Shares      Percent
  Beneficial Owner                             Beneficially Owned     of Class
  ----------------                             ------------------     --------

Herbert S. Davidson ........................      3,742,064(1)(2)       55%
Richard Hyman ..............................         68,000              1%
Robert Davidoff ............................        231,480              3%
Herschel M. Weinberg .......................           None             --
Leonard Gardner ............................            800              *
John Tortorici .............................          2,000              *
Directors and Executive Officers as a Group       4,044,344(1)(2)       60%

----------
*  Less than 1% 

(1)  Includes 731,632 shares of the Company owned by H. S. Davidson Associates,
     Inc. Herbert S. Davidson may be deemed to be a "control person" of the
     Company within the meaning of the Securities Exchange Act of 1934.

(2)  Pursuant to the terms of the Tender Agreement, Mr. Davidson has agreed,
     among other things, to tender his Shares in the Offer and to vote in favor
     of the Merger.

     The Board of Directors of the Company does not have nominating or
compensation committees or committees performing similar functions. An audit
committee consisting of two members was established in April 1996. One meeting
of such committee, in which both members participated, has been held since its
establishment. There were eight meetings of the Board of Directors during the
1996 fiscal year. The directors participated in at least 75% of the meetings of
the Board of Directors held during the term of their tenure. Mr. Davidoff and
Mr. Gardner each receives an annual retainer of $5,000 in respect of service as
a director.

     The following information is submitted with respect to persons who, to the
knowledge of the Company's management, owned beneficially more than 5% of the
Company's outstanding common stock, par value $.25 per share, as of November 26,
1996.

                     Name and Address of       Number of Shares     Percent of 
  Title of Class       Beneficial Owner       Beneficially Owned      Class
  --------------       ----------------       ------------------      -----

Common Stock         Herbert S. Davidson       3,742,064(1)(2)         55%
                     3295 Northwest
                     53rd Circle
                     Boca Raton, FL 33496

----------
(1)  Includes 731,632 shares of the Company owned by H. S. Davidson Associates,
     Inc. Herbert S. Davidson may be deemed to be a "control person" of the
     Company within the meaning of the Securities Exchange Act of 1934.

(2)  Pursuant to the terms of the Tender Agreement, Mr. Davidson has agreed,
     among other things, to tender his Shares in the Offer and to vote in favor
     of the Merger.


                                       A-3

<PAGE>

                             EXECUTIVE COMPENSATION

     Summary Compensation Table

     The following table sets forth certain summary information with respect to
compensation for the periods indicated therein of the Company's Chief Executive
Officer and each of the other most highly compensated executive officers whose
annual salary and bonus for the last fiscal year exceeded $100,000 (such Chief
Executive Officer and executive officers being sometimes hereinafter referred to
in this Schedule A as "named executive officers").

        Name and                                                     All Other
    Principal Position                   Year    Salary    Bonus   Compensation*
    ------------------                   ----    ------    -----   -------------

Herbert S. Davidson .................... 1996   $284,765  $210,000    $6,750
  President and Chairman of the Board    1995    259,961   210,000     6,750
                                         1994    184,534   150,000     4,500

Richard Hyman .......................... 1996    304,233   210,000     6,750
  Executive Vice President               1995    295,015   210,000     6,750
  and Vice President Sales/Marketing     1994    277,897   150,000     4,500

John Tortorici ......................... 1996    166,709    70,000     6,750
  Vice President - Finance and Treasurer 1995    168,022    70,000     6,750
                                         1994    155,366    50,000     4,500

----------
*  Represents portion of the Company's contribution under its 401(k) Plan
   allocated to the named executive officers.

Certain Employment Contracts

     In connection with the Merger Agreement referred to in Schedule 14D-9, the
Parent and/or the Company has entered into employment agreements with certain
officers, including the named executive officers, to be effective at the
Effective Time. See Schedule 14D-9 "Identity and Background - The Merger
Agreement - Benefit Plans and Certain Contracts and Employment Arrangements" for
further information regarding such employment agreements.

Report on Executive Compensation.

     The Board of Directors of the Company does not have a compensation
committee or a Board committee performing equivalent functions. The directors
include Herbert S. Davidson (the Chief Executive Officer) and Richard Hyman (a
named executive officer) as well as Robert Davidoff, Herschel M. Weinberg
(Secretary of the Company) and Leonard Gardner, who, as such directors,
participate in deliberations of the Board on various elements of executive
officer compensation.

     The Company's executive compensation policy is intended to enable the
Company to attract, retain and motivate the executive personnel required for the
success of the Company in a highly competitive industry. In evaluating or fixing
compensation, consideration is given both to overall Company performance and to
individual performance, taking into account particularly the contributions made
by the executive toward improving Company performance. Consideration is also
given to the executive's position and area of responsibility in the structure of
the Company and the job performance of each individual in planning, providing
direction for and implementing the Company's programs, including expansion of
operations in new and established areas, obtaining new distribution lines and
controlling costs. Compensation evaluations are also influenced by prevailing
levels of pay for positions of comparable responsibility in the industry, prior
compensation history and internal pay equity considerations The 1996 executive
compensation levels take into account the foregoing factors. The policies and
criteria set forth above with respect to compensation of executive officers of
the Company apply generally to the Company's Chief Executive Officer. Mr.
Davidson's 1996 compensation reflects his continuing participation in and
contributions to the Company's performance.

     This report has been provided on behalf of the Board of Directors,
consisting of the following members: Herbert S. Davidson, Robert Davidoff,
Herschel M. Weinberg, Richard Hyman and Leonard Gardner.


                                       A-4

<PAGE>

Stockholder Return Performance Graph

     The following graph shows bow an initial investment of $100 in the
Company's common stock would have compared to an equal investment in the Nasdaq
Stock Market (US) Index and the Nasdaq Electronics Components Stock Index over a
five-year period beginning September 30, 1991 and ending September 30, 1996.

   [The following table was depicted as a line graph in the printed material]

--------------------------------------------------------------------------------
                                      1991   1992    1993   1994    1995    1996
--------------------------------------------------------------------------------
Milgray Electronics, Inc.              100    175     714    743   1,435   1,251
--------------------------------------------------------------------------------
The NASDAQ Stock Market (US)           100    112     147    148     204     243
--------------------------------------------------------------------------------
NASDAQ Electronic Components Stocks    100    137     264    257     512     609
--------------------------------------------------------------------------------

                COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

     Section 16(a) of the Exchange Act requires the Company's directors and
executive officers and, if any, persons who own more than ten percent of the
Shares to file with the Securities and Exchange Commission initial reports
relating to beneficial ownership and reports of changes in beneficial ownership
of such Shares. Copies of these reports must also be furnished to the Company.
Based solely on a review of copies of such reports furnished to the Company and
on written representations from the reporting persons, the Company believes that
all applicable Section 16(a) reporting requirements were complied with in the
fiscal year ended September 30, 1996.


                                       A-5

<PAGE>

                                                                  EXHIBIT (a)(4)


                         [MESIROW FINANCIAL LETTERHEAD]

November 26, 1996
Board of Directors
Milgray Electronics, Inc.
77 Schmitt Boulevard
Farmingdale, New York 11735

Gentlemen:

     Milgray Electronics, Inc. ("Milgray" or the "Company") proposes to enter
into an agreement with Bell Industries, Inc. ("Bell") and ME Acquisition, Inc.,
a wholly owned subsidiary of Bell (the "Purchaser") pursuant to which the
Purchaser will make a tender offer for all of the issued and outstanding shares
of common stock of the Company ("Common Stock"), after which the Purchaser will
be merged with and into the Company. The offer is expected to commence on or
around December 4, 1996, and the price per share offered to holders of Common
Stock of the Company is expected to be $14.77, net to the sellers in cash for
each share of Common Stock that is purchased, or at the effective time of the
merger. You have asked Mesirow Financial, Inc. ("Mesirow") to render its opinion
(the "Opinion") as to whether or not the proposed consideration to be received
by the holders of the Common Stock in the proposed transaction is fair, from a
financial point of view, to such shareholders.

In connection with rendering the Opinion we have, among other things:

          (i) reviewed the latest draft, dated November 9, 1996, of the
     Agreement and Plan of Merger;

          (ii) reviewed the latest available schedules provided by Milgray and
     the Purchaser pursuant to the Agreement and Plan of Merger;

          (iii) reviewed Milgray's annual reports on Form 10-K and annual
     reports to shareholders for the years ended September 30, 1993, 1994, and
     1995, quarterly reports on Form 10-Q for the quarters ended December 31,
     1995, March 31, 1996, and June 30, 1996 and certain other filings with the
     Securities and Exchange Commission made by Milgray, including proxy
     statements;

          (iv) reviewed the current and historical market prices and trading
     data for Milgray Common Stock;

          (v) reviewed certain non-public information relating to Milgray
     including monthly internal financial statements for the year ended
     September 30, 1996;

          (vi) reviewed financial forecasts and projections for Milgray prepared
     by the senior management of Milgray for the years ended September 30, 1997
     through September 30, 2001;

          (vii) reviewed certain publicly available information, including
     research reports concerning certain other companies engaged in businesses
     which we believed to be comparable to Milgray and the trading markets for
     certain of such companies' securities;

          (viii) reviewed the financial terms of certain recent mergers and
     acquisitions which we believed to be relevant;

          (ix) conducted discussions with Herbert S. Davidson, President and
     Chairman of the Board, Richard Hyman, a Director and Executive Vice
     President and Vice President-Sales/Marketing, and John Tortorici, Vice
     President-Finance, Treasurer and Assistant Secretary concerning their
     business and operations, assets, present conditions, and future prospects;

          (x) conducted discussions with a representative from the Company's
     independent certified public accountants, Grant Thornton LLP; and

<PAGE>

          (xi) performed such other analyses, examinations and procedures,
     reviewed such other agreements and documents, and considered such other
     factors, as we deemed, in our sole judgment, to be necessary, appropriate
     or relevant to render our opinion.

     In arriving at our opinion, we have assumed and relied, without independent
verification, upon the accuracy and completeness of the information obtained
from public sources or provided to us by the Company. In addition, we have
assumed that Milgray's forecasts and projections furnished to us have been
reasonably prepared on bases reflecting the best currently available estimates
and judgments of the Company's management as to the future financial condition
and operating results of the Company. In addition, we have not made an
independent evaluation or appraisal of the assets or liabilities (contingent or
otherwise) of the Company, nor have we been furnished with any such evaluations
or appraisals.

     Our opinion is necessarily based upon general economic, financial, market
and other conditions as they exist and can be evaluated on the date hereof. We
were not requested to, and did not, solicit third party indications of interest
in acquiring all or any part of, or merging with, or into, the Company.

     Mesirow is a full service securities firm and, therefore, in the ordinary
course of our trading and brokerage activities, Mesirow or any of our affiliates
may at any time hold long or short positions, and may trade or otherwise effect
transactions, for our own account or the accounts of customers, in securities of
Milgray or Bell. Mesirow will receive a fee for rendering this opinion.

     Based upon and subject to the foregoing, including the various assumptions
and limitations set forth herein, it is our opinion that, as of the date hereof,
the consideration to be offered to the holders of the Common Stock of Milgray is
fair, from a financial point of view, to such holders.

     This opinion is for the use and benefit of the Board of Directors of the
Company and may not be reproduced, summarized, described or referred to or given
to any other person except in connection with the Company's initial public
announcement of the proposed merger, Schedule 14D-9 and any amendment thereof,
or proxy statement regarding the merger.


Very truly yours,



MESIROW FINANCIAL, INC.
Mesirow Financial, Inc.