SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
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Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 26, 1997
(June 12, 1997)
IRON MOUNTAIN INCORPORATED
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(Exact Name of Registrant as Specified in its Charter)
Delaware
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(State or Other Jurisdiction of Incorporation or Organization)
0-27584 04-3107342
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(Commission file number) (I.R.S. Employer Identification No.)
745 Atlantic Avenue, Boston, MA 02111
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(Address of Principal Executive Offices, Including Zip Code)
(617) 357-4455
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(Registrant's Telephone Number, Including Area Code)
<PAGE>
This current report on Form 8-K/A amends and restates, in its entirety, the
Current Report on Form 8-K (date of report June 12, 1997) which was filed with
the Securities and Exchange Commission on June 25, 1997.
Item 2. Acquisition or Disposition of Assets
On June 12, 1997, Safesite Records Management Corporation ("Safesite"), a
Delaware corporation, merged with and into Iron Mountain/Safesite, Inc., a
wholly owned subsidiary of Iron Mountain Incorporated (the "Registrant"),
pursuant to an Agreement and Plan of Merger dated February 19, 1997, as amended,
(the "Agreement") among the Registrant, Iron Mountain/Safesite, Inc. and
Safesite. In addition, wholly owned subsidiaries of the Registrant also acquired
certain real property from a trust for the benefit of the controlling
stockholders of Safesite. The Registrant intends to sell a portion of the real
property acquired.
In consideration, the Registrant issued, pursuant to the Agreement, 1,769,712
shares of its $.01 par value common stock (the "Registrant's Common Stock")
valued at approximately $51.3 million based upon the closing price of the
Registrant's Common Stock (NASDAQ: IMTN) on June 12, 1997. Included within the
1,769,712 of issued shares are 141,836 shares which are being held in escrow
until June 12, 1998 to satisfy any potential claims in accordance with the
Agreement. In addition, the Registrant issued options, valued at approximately
$2.3 million, to purchase approximately 109,000 shares of the Registrant's
Common Stock and cash of approximately $16.2 million.
The funds used to pay the cash portion of the consideration were comprised
primarily of borrowings under the Registrant's $150 million revolving credit
facility dated September 30, 1996, as amended, among the Registrant, various
financial institutions and The Chase Manhattan Bank, as administrative agent for
such lenders.
The assets acquired by the Registrant included real property, tangible personal
property (consisting primarily of office equipment, furniture and fixtures,
motor vehicles, racking and shelving), and intangible personal property
regularly used in Safesite's record management business. Except for certain real
property discussed above, the Registrant intends to use the acquired assets in
the operation of its record management business.
Item 7. Financial Statements and Exhibits
Page
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(a) Financial Statements of the Business Acquired:
The audited financial statements as of and for the
year ended December 31, 1996 are incorporated by
reference to the Registration Statement on Form
S-4, as amended, filed with the Securities and
Exchange Commission on April 4, 1997 (Reg. No.
333-24635).
Condensed Balance Sheet as of March 31, 1997
(Unaudited) 4
Condensed Statements of Operations for the Three
Months Ended March 31, 1997 and 1996 (Unaudited) 5
Condensed Statements of Cash Flows for the Three
Months Ended March 31, 1997 and 1996 (Unaudited) 6
2
<PAGE>
Page
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Notes to Condensed Financial Statements
(Unaudited) 7
(b) Pro Forma Financial Information: 8
Pro Forma Condensed Consolidated Balance Sheet as
of March 31, 1997 (Unaudited) 9
Pro Forma Condensed Consolidated Statement of
Operations for the Three Months Ended March 31,
1997 (Unaudited) 10
Pro Forma Condensed Consolidated Statement of
Operations for the Year Ended December 31, 1996
(Unaudited) 11
Notes to the Pro Forma Condensed Consolidated
Financial Statements (Unaudited) 12-13
(c) Exhibits
Exhibit 2.1
The Agreement and Plan of Merger by and among Iron
Mountain Incorporated, Iron Mountain/Safesite,
Inc. and Safesite Records Management Corporation
dated as of February 19, 1997, as amended, is
incorporated by reference to the Registration
Statement on Form S-4, as amended, filed with the
Securities and Exchange Commission on April 4,
1997 (Reg. No. 333-24635).
3
<PAGE>
SAFESITE RECORDS MANAGEMENT CORPORATION
CONDENSED BALANCE SHEET
AS OF MARCH 31, 1997
(IN THOUSANDS, EXCEPT SHARE DATA)
(Unaudited)
Assets
Current Assets:
Cash and Cash Equivalents $ 146
Accounts Receivable, less reserve
for doubtful accounts of $117 2,586
Prepaid Expenses and Other 192
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Total Current Assets 2,924
=======
Property and Equipment:
Property and Equipment 8,437
Less: Accumulated Depreciation (4,171)
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Net Property and Equipment 4,266
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Deposits and Other 387
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Total Assets $7,577
=======
Liabilities and Stockholders' Equity
Current Liabilities:
Revolving Line of Credit $ 731
Accounts Payable 754
Accrued Expenses 1,255
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Total Current Liabilities 2,740
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Stockholders' Equity:
Preferred Stock, $.01 par value-
Authorized- 5,000,000 shares
Issued and Outstanding- None
Common Stock, $.01 par value-
Authorized- 15,000,000 shares
Issued and Outstanding- 9,107,847 91
Additional Paid-in Capital 12,949
Accumulated Deficit (8,203)
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Total Stockholders' Equity 4,837
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Total Liabilities and Stockholders' Equity $7,577
=======
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
SAFESITE RECORDS MANAGEMENT CORPORATION
CONDENSED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(IN THOUSANDS)
(Unaudited)
1997 1996
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Revenues:
Storage $2,316 $1,970
Service and Storage Material Sales 3,290 2,466
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Total Revenues 5,606 4,436
Operating Expenses:
Cost of Sales (Excluding Depreciation
and Amortization) 2,845 2,191
Selling, General and Administrative 2,223 1,796
Depreciation and Amortization 219 194
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Total Operating Expenses 5,287 4,181
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Operating Income 319 255
Interest Expense 12 9
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Income Before Provision for Income Taxes 307 246
Provision for Income Taxes 45 26
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Net Income $ 262 $ 220
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The accompanying notes are an integral part of these financial statements.
5
<PAGE>
SAFESITE RECORDS MANAGEMENT CORPORATION
CONDENSED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(IN THOUSANDS)
(Unaudited)
1997 1996
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Cash Flows from Operating Activities:
Net Income $ 262 $ 220
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and Amortization 219 194
Reserve for Bad Debts 22 14
Changes in Assets and Liabilities:
Accounts Receivable (193) (186)
Prepaid Expenses and Other 1 (62)
Accounts Payable (102) (47)
Accrued Expenses (161) (118)
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Net Cash Provided by Operating Activities 48 15
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Cash Flows from Investing Activities:
Additions to Property and Equipment (515) (311)
Increase in Other Assets (122) 34
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Net Cash Used for Investing Activities (637) (277)
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Cash Flows from Financing Activities:
Proceeds from Bank Loan 505 100
Proceeds from Issuance of Common Stock 8 -
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Net Cash Provided by Financing Activities 513 100
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Net Decrease in Cash and Cash Equivalents (76) (162)
Cash and Cash Equivalents, Beginning of Period 222 297
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Cash and Cash Equivalents, End of Period $ 146 $ 135
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The accompanying notes are an integral part of these financial statements.
6
<PAGE>
SAFESITE RECORDS MANAGEMENT CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
(1) General
The interim condensed financial statements presented herein have been prepared
by Safesite Records Management Corporation (the "Company") without audit and, in
the opinion of management, reflect all adjustments of a normal recurring nature
necessary for a fair presentation. Interim results are not necessarily
indicative of results for a full year.
The unaudited condensed financial statements have been prepared pursuant to the
rules and regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in the annual financial
statements prepared in accordance with generally accepted accounting principles
have been omitted pursuant to those rules and regulations, but the Company
believes that the disclosures are adequate to make the information presented not
misleading.
(2) Subsequent Event
After receiving the approval of the Company's stockholders, the Company merged
with and into Iron Mountain/Safesite, Inc. on June 12, 1997.
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<PAGE>
IRON MOUNTAIN INCORPORATED
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited Pro Forma Condensed Consolidated Balance Sheet has been
prepared based on the historical consolidated balance sheets of the Registrant
and Safesite as of March 31, 1997 and gives effect to the Safesite merger and
related transactions as if they had been completed as of March 31, 1997. The
following unaudited Pro Forma Condensed Statements of Operations for the year
ended December 31, 1996 and for the three months ended March 31, 1997 give
effect to the Safesite merger and related transactions as if they had occurred
January 1, 1996. Pro Forma adjustments are described in the accompanying notes.
The Pro Forma Condensed Consolidated Statements of Operations are not
necessarily indicative of the actual results of operations that would have been
reported if the merger and related transactions had been consummated as of
January 1, 1996, nor does it purport to indicate the results of future
operations of the Registrant. Furthermore, the pro forma results do not give
effect to all cost savings or incremental costs which may occur as a result of
the integration and consolidation of the merger and related transactions. In the
opinion of management, all adjustments necessary to present fairly such pro
forma financial statements have been made.
The merger and related transactions have been accounted for using the purchase
method of accounting.
8
<PAGE>
IRON MOUNTAIN INCORPORATED
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
MARCH 31, 1997
(IN THOUSANDS)
<TABLE>
<CAPTION>
Iron Mountain Pro Forma
Historical Safesite Adjustments Iron Mountain
---------- -------- ----------- -------------
<S> <C> <C> <C> <C>
Assets
Current Assets $ 36,166 $2,924 $ - $ 39,090
Property, Plant and Equipment, net 121,837 4,266 4,099 (A) 130,202
Goodwill, net 123,378 - 61,836 (B) 185,214
Other Long-term Assets 20,416 387 1,651 (C) 22,454
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Total Assets $301,797 $7,577 $67,586 $376,960
======== ====== ======= ========
Liabilities and Stockholders' Equity
Current Liabilities $ 29,856 $2,330 $ 1,763 (D) $ 33,949
Long-term Debt, net of current portion 201,092 - 18,155 (E) 219,247
Other Long-term Liabilities 6,568 - - 6,568
Deferred Rent 8,138 410 (410) (A) 8,138
Deferred Income Taxes 4,209 - (228) (F) 3,981
Stockholders' Equity 51,934 4,837 48,306 (G) 105,077
-------- ------ ------- --------
Total Liabilities and Stockholders' Equity $301,797 $7,577 $67,586 $376,960
======== ====== ======= ========
</TABLE>
The accompanying notes are an integral part of
these pro forma financial statements.
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<PAGE>
IRON MOUNTAIN INCORPORATED
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE THREE MONTHS ENDED MARCH 31, 1997
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Iron Mountain Pro Forma
Historical Safesite Adjustments Iron Mountain
---------- -------- ----------- -------------
<S> <C> <C> <C> <C>
Revenues:
Storage $ 25,823 $ 2,316 $ - $28,139
Service and Storage Material Sales 16,331 3,290 - 19,621
------ ----- ------ ------
Total Revenues 42,154 5,606 - 47,760
Operating Expenses:
Cost of Sales (Excluding Depreciation) 21,764 2,845 (104) (H) 24,505
Selling, General and Administrative 10,207 2,223 - 12,430
Depreciation and Amortization 5,722 219 395 (I) 6,336
------ ----- ------ ------
Total Operating Expenses 37,693 5,287 291 43,271
------ ----- ------ ------
Operating Income 4,461 319 (291) 4,489
Interest Expense 5,140 12 341 (J) 5,493
------ ----- ------ ------
Income (Loss) Before Provision (Benefit)
for Income Taxes (679) 307 (632) (1,004)
Provision (Benefit) for Income Taxes (163) 45 31 (K) (87)
------ ----- ------ ------
Net Income (Loss) $ (516) $ 262 $ (663) $ (917)
======= ====== ======= ========
Net Loss per Common and Common
Equivalent Shares Outstanding $ (.05) $ (.08)
====== ========
Weighted Average Common and Common
Equivalent Shares Outstanding 10,137 1,770 11,907
</TABLE>
The accompanying notes are an integral part of
these pro forma financial statements.
10
<PAGE>
IRON MOUNTAIN INCORPORATED
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Iron Mountain Pro Forma
Historical Safesite Adjustments Iron Mountain
---------- -------- ----------- -------------
<S> <C> <C> <C> <C>
Revenues:
Storage $ 85,826 $ 8,300 $ - $94,126
Service and Storage Material Sales 52,892 10,709 - 63,601
------ ------ --------- -------
Total Revenues 138,718 19,009 - 157,727
Operating Expenses:
Cost of Sales (Excluding Depreciation) 70,747 9,464 (435) (H) 79,776
Selling, General and Administrative 34,342 7,587 - 41,929
Depreciation and Amortization 16,936 799 1,653 (I) 19,388
------ ------ --------- -------
Total Operating Expenses 122,025 17,850 1,218 141,093
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Operating Income 16,693 1,159 (1,218) 16,634
Interest Expense 14,901 34 1,378 (J) 16,313
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Income Before Provision for Income Taxes 1,792 1,125 (2,596) 321
Provision for Income Taxes 1,435 125 111 (K) 1,671
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Income (Loss) Before Extraordinary Charge $ 357 $1,000 $ (2,707) $(1,350)
======= ====== ========= ========
Income (Loss) Before Extraordinary Charge
per Common and Common
Equivalent Shares Outstanding $ .04 $ (.11)
======= ========
Weighted Average Common and
Common Equivalent Shares Outstanding 10,137 1,770 11,907
</TABLE>
The accompanying notes are an integral part of these
pro forma financial statements.
11
<PAGE>
IRON MOUNTAIN INCORPORATED
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS)
(1) Purchase Price Allocation
The excess of the purchase price over the book value of the net assets acquired
has been allocated to tangible and intangible assets, based on Iron Mountain's
estimate of the fair value of the assets and liabilities acquired.
Purchase Price:
Fair Value of Common Stock Issued $51,321
Fair Value of Options Issued 2,282
Cash Paid 16,227
--------
Total Purchase Price $69,830
Allocation of Purchase Price:
Net book value of assets and liabilities acquired $ 4,837
Allocation of purchase price in excess of acquired
assets and liabilities:
Property, Plant and Equipment 4,099
Other Long-Term Assets 1,651
Current Liabilities (2,492)
Long-Term Liabilities (101)
Goodwill 61,836
--------
Total Purchase Price $69,830
=========
(2) Pro Forma Balance Sheet Adjustments
The pro forma adjustments to the Condensed Consolidated Balance Sheet consist of
the following:
(A) To reflect the estimated fair market value of those assets and
liabilities that were acquired by the Company
(B) To record the excess of the purchase price over the fair market value
assigned to the assets and liabilities acquired.
(C) To reverse other long-term assets not purchased by the Company and
record a building held for sale purchased by the Company.
(D) To reverse the current liabilities not assumed by the Company and
record additional liabilities recorded by the Company as a result of
the acquisition.
(E) To record additional debt used to finance the acquisition.
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<PAGE>
IRON MOUNTAIN INCORPORATED
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS)
(F) To record deferred taxes on the purchase reserves recorded and the
step up in the basis of fixed assets purchased at a rate of 40%.
(G) To reverse the stockholders' equity of Safesite and record the
issuance of stock and stock options issued in connection with the
merger.
(3) Pro Forma Statements of Operations
The pro forma adjustments to the Condensed Consolidated Statements of Operations
consist of the following:
(H) To adjust rent expense to reflect the purchase of facilities
previously leased by Safesite.
(I) To adjust depreciation expense to the proper level based on the fair
value of the assets acquired and to record amortization on goodwill
recorded as part of the merger. The goodwill recorded in connection
with this merger is being amortized over 30 years.
(J) To reverse interest expense on retired debt and to record interest
expense on the additional debt incurred to finance the acquisition.
(K) To adjust the provision for income taxes to a 40% rate on pro forma
income before nondeductible goodwill amortization and other
nondeductible expenses.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IRON MOUNTAIN INCORPORATED
(Registrant)
August 26, 1997 By: /s/ Jean A. Bua
- --------------- ---------------------------------------
(date) Jean A. Bua
Vice President and Corporate Controller
(Principal Accounting Officer)
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