Unassociated Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K/A

CURRENT REPORT
 
PURSUANT TO SECTION 13 OR 15 (D)
OF THE SECURITIES EXCHANGE ACT OF 1934

 DATE OF REPORT: May 17, 2007
   COMMISSION FILE NO. 0-22810
(Date of earliest event reported)
 

MACE SECURITY INTERNATIONAL, INC.
(Exact name of Registrant as specified in its charter)


DELAWARE
(State or other jurisdiction of
incorporation or organization) 
03-0311630
(I.R.S. Employer
Identification No.)
    
1000 Crawford Place, Suite 400, Mt. Laurel, NJ 08054
(Address of Principal Executive Offices)

Registrant's Telephone No., including area code: (856) 778-2300

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 communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[   ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
 
Item 2.01 Completion of Acquisition or Disposition of Assets

On May 17, 2007, Mace Security International, Inc. (“MSI”), through two of its subsidiaries, Mace Car Wash, Inc. and Mace Car Wash-Arizona, Inc. (the “Subsidiaries”), sold twelve Phoenix, AZ area car washes constituting MSI’s Arizona Car Wash Region to Twisted Cactus Enterprises, LLC (the “Purchaser”). Under the terms of the Asset Purchase Agreement, dated December 7, 2006 (the “Agreement”), the Purchaser paid a purchase price of $19,380,000 for the inventory and property and equipment of the twelve Phoenix, AZ area car washes. As a result of the sale, MSI’s available cash increased by $9,013,000, consisting of $8,513,000 received at closing on May 17, 2007 and $500,000 received on April 6, 2007 through the release of an escrow deposit. Approximately $10,367,000 of the transaction consideration was used to pay-off existing MSI bank debt, including $1,188,000 of defeasance costs incurred as a result of the early retirement of the debt. In addition to paying the purchase price, the Purchaser assumed responsibility for the remaining term of leases for three car wash locations, as well as the liability for car wash deferred revenue related to pre sold services. MSI retained cash, accounts receivable and all other assets, and remains responsible for all remaining liabilities. The Agreement was filed as Exhibit 10.1 to MSI’s Current Report on Form 8-K, filed on December 13, 2006. There is no material relationship between the Purchaser and MSI and the Subsidiaries other than in connection with the Agreement.


Item 9.01.  Financial Statements and Exhibits.
 
(b) Pro Forma Financial Information. Pro forma financial information is being filed by this amendment to our Current Report on Form 8-K dated May 17, 2007, as originally filed on May 23, 2007. The enclosed pro forma financial information is calculated based on the Company’s financial information for its most recent completed fiscal year and quarterly period. The pro forma information could not be finalized until the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2006 (the “10-K”) and its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2007 (the “10-Q”) were completed. The 10-K and 10-Q which were filed with the Securities and Exchange Commission on July 2, 2007 and July 9, 2007, respectively. As previously disclosed, the Company was delayed in filing the 10-K and the 10-Q because, during the process of completing its consolidated financial statement for the fiscal year ended December 31, 2006, the Company identified certain un-reconciled accounts and accounting errors made by the Company's accounting controller of its Florida based security division. The Company’s auditors could not complete the 2006 audit and review of the 10-Q and, therefore, the 10-K and 10-Q could not be filed, until the Company concluded its investigation and completed its closing process.
 
(d)  Exhibits. The following exhibit is being filed by incorporation:
 
10.1  Asset Purchase Agreement dated December 7, 2006, between Mace Security International, Inc., Mace Car Wash, Inc., Mace Car Wash-Arizona, Inc., and Twisted Cactus Enterprises, LLC. (Incorporated by reference to Exhibit 10.1 to MSI’s Current Report on Form 8-K filed on December 13, 2006)
 

 
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATENMENTS FOR
MACE SECURITY INTERNATIONAL, INC.

On May 17, 2007, Mace Security International, Inc. (the "Company") completed the sale of its twelve Phoenix, AZ Car washes . The unaudited pro forma consolidated financial information shown below is based on audited and unaudited historical financial statements of the Company. The unaudited pro forma financial information presented reflects the estimated pro forma effect of the disposition on the Company.

The unaudited pro forma consolidated financial statements are as follows:

§  
An unaudited pro forma consolidated balance sheet as of March 31, 2007, giving effect to the disposition as if it occurred on March 31, 2007.
§  
An unaudited pro forma consolidated statement of operations for the three months ended March 31, 2007, giving effect to the disposition as if it had occurred on January 1, 2007.
§  
An unaudited pro forma consolidated statement of operations for the year ended December 31, 2006, giving effect to the disposition as if it had occurred on January 1, 2006.

The unaudited pro forma consolidated financial statements include specific assumptions and adjustments related to the disposition. These pro forma adjustments have been made to illustrate the anticipated financial effect of the disposition on the Company. The adjustments are based upon available information and assumptions that the Company believes are reasonable as of the date of this filing. However, actual adjustments may differ materially from the information presented. Assumptions underlying the pro forma adjustments are described in the accompanying notes, which should be read in conjunction with the unaudited pro forma consolidated financial statements. The pro forma financial statements, including notes thereto, should be read in conjunction with the historical financial statements of the Company included in our Annual Report on Form 10-K for the year ended December 31, 2006, and the unaudited financial statements included in our Quarterly Report on Form 10-Q for the three month period ended March 31, 2007.

The unaudited pro forma consolidated financial information presented herein is for informational purposes only. It is not intended to represent or be indicative of the consolidated results of operations or financial position that would have been reported had the disposition been completed as of the dates presented. The information is not representative of future results of operations or financial position.


 
Mace Security International, Inc. and Subsidiaries
Unaudited Pro Forma Consolidated Balance Sheet
(In thousands, except share data)
As of March 31, 2007

   
As Reported
  
 Business
  
  Pro Forma
  
Assets
  
March 31, 2007
  
 Disposition (a)
  
 March 31, 2007
  
               
Current Assets
                
    Cash and cash equivalents
  
$
10,237
  
$
9,013
  
$
19,250
  
    Short-term investments
    
3,705
    
-
    
3,705
  
    Accounts receivable, net
    
2,103
    
-
    
2,103
  
    Inventories
    
6,455
    
-
    
6,455
  
    Prepaid expenses and other
                    
      current assets
    
2,229
    
-
    
2,229
  
    Assets held for sale
    
18,515
    
(17,513
)
  
1,002
  
Total current assets
    
43,244
    
(8,500
)
  
34,744
  
                     
Property and equipment, net
    
38,097
    
-
    
38,097
  
Goodwill
    
1,623
    
-
    
1,623
  
Other intangible assets, net
    
2,854
    
-
    
2,854
  
Other assets
    
147
    
-
    
147
  
                     
Total assets
  
$
85,965
  
$
(8,500
)
$
77,465
  
                     
Liabilities and Stockholders’ Equity
                    
                     
Current liabilities:
                    
    Current portion of long-term debt and capital
                    
     lease obligations
  
$
4,179
    
-
  
$
4,179
  
    Accounts Payable
    
3,410
    
-
    
3,410
  
    Income taxes payable
    
352
    
-
    
352
  
    Deferred revenue
    
286
    
-
    
286
  
    Accrued expenses and other current liabilities
    
2,295
    
-
    
2,295
  
    Liabilities related to assets held for sale
    
9,511
    
(9,240
)
  
271
  
                     
Total current liabilities
    
20,033
    
(9,240
)
  
10,793
  
                     
Long-term debt and capital leases, net of
                    
current portion
    
9,832
    
-
    
9,832
  
                     
Commitments
     -     -     -  
                     
Stockholders’ equity:
                    
                     
    Preferred stock- $.01 par value:
                    
    Authorized shares-10,000,000
    
-
    
-
    
-
  
    Issued and outstanding-none
                    
    Common stock - $.01 par value:
                    
    Authorized shares-100,000,000
                    
    Issued and outstanding shares of 15,275,382
    
153
    
-
    
153
  
                     
    Additional paid-in capital
    
90,077
    
-
    
90,077
  
    Accumulated other comprehensive income
    
438
    
-
    
438
  
    Accumulated deficit
    
(34,568
)
  
740
    
(33,828
)
                     
Total stockholders’ equity
    
56,100
    
740
    
56,840
  
                     
Total liabilities and stockholders’ equity
  
$
85,965
  
$
(8,500
)
$
77,465
  
 

Mace Security International, Inc. and Subsidiaries
Notes to Unaudited Pro Forma Consolidated Balance Sheet
At March 31, 2007


(a)    
The disposition reflects the net cash proceeds of approximately $9.0 million. Cash proceeds are net of debt payoff of approximately $9.2 million, debt defeasance costs of $1.35 million and other transaction closing costs of approximately $240,000.
 


 
Mace Security International, Inc. and Subsidiaries
Unaudited Pro Forma Statement of Operations
(in thousands, except share and per share data)
For the Three Months Ended March 31, 2007
Revenue
  
As Reported 
    
Business
Disposition
      
Pro Forma
Adjusted
  
                       
  Car wash and detailing services
  
$
4,687
  
$
-
    
$
4,687
  
  Lube and other automotive services
    
805
    
-
      
805
  
  Fuel and merchandise sales
    
654
    
-
      
654
  
  Security sales
    
5,435
    
-
      
5,435
  
     
11,581
    
-
      
11,581
  
                       
Cost of revenues:
                      
                       
  Car wash and detailing services
    
3,542
    
-
      
3,542
  
  Lube and other automotive services
    
634
    
-
      
634
  
  Fuel and merchandise sales
    
575
    
-
      
575
  
  Security sales
    
4,047
    
-
      
4,047
  
     
8,798
            
8,798
  
                       
Selling, general and administrative expenses
    
4,187
    
-
      
4,187
  
Depreciation and amortization
    
399
    
-
      
399
  
                       
Operating loss
    
(1,803
)
  
-
      
(1,803
)
                       
Interest expense, net
    
(254
)
  
113
 (a)    
(141
)
Other income
    
138
    
-
      
138
  
(Loss) income from continuing operations before
                      
income taxes
    
(1,919
)
  
113
      
(1,806
)
Income tax expense
    
25
    
-
      
25
  
(Loss) income from continuing operations
    
(1,944
)
  
113
      
(1,831
)
Income from discontinued operations
    
1,286
    
(182
)(b)
  
1,104
  
Net loss
  
$
(658
)
$
(69
)
  
$
(727
)
                       
Per share of common stock (basic and diluted):
                      
                       
Loss from continuing operations
  
$
(0.13
)
$
0.01
    
$
(0.12
)
Income from discontinued operations, net of tax
    
0.09
    
(0.02
)
    
0.07
  
Net loss
  
$
(0.04
)
$
(0.01
)
  
$
(0.05
)
                       
Weighted average shares outstanding:
                      
                       
Basic
    
15,275,382
            
15,275,382
  
Diluted
    
15,275,382
            
15,275,382
  
 
Mace Security International, Inc. and Subsidiaries
Notes to Unaudited Pro Forma Statement of Income
For the Three Months Ended March 31, 2007

(a)  
Interest income on net cash proceeds from sale.
(b)  
Elimination of net income from discontinued operations.


 
Mace Security International, Inc. and Subsidiaries
Unaudited Pro Forma Statement of Operations
(in thousands, except share and per share data)
For the Year Ended December 31, 2006 
 
Revenue
 
 
As Reported 
 
 
Business
Disposition 
 
 
 
Pro Forma
Adjusted 
  
                       
  Car wash and detailing services
  
$
19,063
  
$
-
    
$
19,063
  
  Lube and other automotive services
    
3,445
    
-
      
3,445
  
  Fuel and merchandise sales
    
3,341
    
-
      
3,341
  
  Security sales
    
23,366
    
-
      
23,366
  
     
49,215
            
49,215
  
                       
Cost of revenues:
                      
                       
  Car wash and detailing services
    
14,733
    
-
      
14,733
  
  Lube and other automotive services
    
2,727
    
-
      
2,727
  
  Fuel and merchandise sales
    
3,026
    
-
      
3,026
  
  Security sales
    
17,427
    
-
      
17,427
  
     
37,913
            
37,913
  
                       
Selling, general and administrative expenses
    
16,868
            
16,868
  
Depreciation and amortization
    
1,621
            
1,621
  
Goodwill and asset impairment charges
    
151
              
151
  
                       
Operating loss
    
(7,338
)
          
(7,338
)
Interest expense, net
    
(961
)
  
450
 (a)
 
  
(511
)
Other income
    
1,093
    
-
      
1,093
  
(Loss) income from continuing operations before income taxes
    
(7,206
)
  
450
      
(6,756
)
                       
Income tax expense
    
156
    
-
      
156
  
(Loss) income from continuing operations
    
(7,362
)
  
450
      
(6,912
)
Income (loss) from discontinued operations, net
    
580
    
(1,183
)(b)
  
(603
)
Net loss
  
$
(6,782
)
$
(733
)
  
$
(7,515
)
                       
Per share of common stock (basic and diluted):
                      
Loss from continuing operations
  
$
(0.48
)
$
0.03
    
$
(0.45
)
Income (loss) from discontinued operations, net of tax
    
0.04
    
(0.08
)
    
(0.04
)
Net loss
  
$
(0.44
)
$
(0.05
)
  
$
(0.49
)
                       
Weighted average shares outstanding:
                      
                       
Basic
    
15,274,498
            
15,274,498
  
Diluted
    
15,274,498
            
15,274,498
  
Mace Security International, Inc.
Notes to Unaudited Pro Forma Statement of Income
For the Year Ended December 31, 2006

a)  
Interest income on cash proceeds from sale.
b)  
Elimination of net income from discontinued operations.



 

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
     
Dated:  July 12, 2007 Mace Security International, Inc.
 
 		  
 		  
 
  By:   /s/ Gregory M. Krzemien
 
Gregory M. Krzemien
  Chief Financial Officer and Treasurer