<PAGE>
FORM 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report: February 13, 1997
Date of Earliest Event Reported: January 24, 1997
BORG-WARNER SECURITY CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-5529 13-3408028
(State of Incorporation) (Commission File No.) (I.R.S. Employer
Identification No.)
200 South Michigan Avenue, Chicago, Illinois 60604
(Address of principal executive offices)
Registrant's telephone number, including area code:
(312) 322-8500
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Item 7. Financial Statements and Exhibits.
(b) Pro forma financial information
Pro forma consolidated statements of earnings for the year ended
December 31, 1995 and the nine months ended September 30, 1996 and pro
forma condensed consolidated balance sheet at September 30, 1996 are
attached as Exhibit 99 hereto and are incorporated by reference herein
(c) Exhibits
99 Pro forma consolidated statements of earnings for the year ended
December 31, 1995 and the nine months ended September 30, 1996 and pro
forma condensed consolidated balance sheet at September 30, 1996
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 hereunto duly authorized.
BORG-WARNER SECURITY CORPORATION
By /S/ Timothy M. Wood
--------------------
Timothy M. Wood
Vice President
Dated: February 13, 1997
-2-
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Exhibit 99
BORG-WARNER SECURITY CORPORATION
SUPPLEMENTAL PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
(MILLIONS OF DOLLARS)
Introduction
- ------------
The accompanying unaudited Pro Forma Financial Information has been prepared as
a result of the combination of the Company's armored services unit ("WFAS") with
Loomis, as described in the preceding information. The unaudited Pro Forma
Fianancial Information is based on the historical financial statements of the
Company and WFAS and gives effect to (i) the disposition of substantially all of
the assets and certain liabilities of WFAS and other adjustments related to the
business combination and (ii) the application of the net proceeds received by
the Company to repay certain indebtedness. The accompanying unaudited Pro Forma
Consolidated Statements of Earnings for the year ended December 31, 1995 and the
nine months ended September 30, 1996 give effect to the transactions as if they
had been consummated on January 1, 1995. The unaudited Pro Forma Condensed
Consolidated Balance Sheet at September 30, 1996 is presented giving effect to
the transactions as if they had been consummated as of that date.
The pro forma result of operations do not include any nonrecurring charge or
credits which will directly result from the transaction and which will be
included in the Company's results of operations within the 12 months following
the transaction. While the Company anticipates that it will recognize a gain
from sale of WFAS' assets, the transaction is subject to potential significant
purchase price adjustments and any gain cannot be reasonably estimated at this
time. The Company does not anticipate that the gain will be material. The
Company does not expect any other material nonrecurring charges or credits to
result form the transaction.
The unaudited Pro Forma Financial Information is intended for informational
purposes only and is not necessarily indicative of the future results of
operations or financial position of the Company had the transactions described
above occurred on the indicated dates or been in effect for the periods
presented.
The unaudited Pro Forma Financial Information and the accompanying notes should
be read in conjunction with, and are qualified in their entirety by, the
historical consolidated financial statements of the Company and WFAS, including
the related notes thereto.
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BORG WARNER SECURITY CORPORATION
PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)
YEAR ENDED DECEMBER 31, 1995
(MILLIONS OF DOLLARS EXCEPT PER SHARE)
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments (a) Pro Forma
---------- ------------ ---------
<S> <C> <C> <C>
Net service revenue $1,708.5 ($231.0) $1,477.5
Cost of services 1,359.3 (188.6) 1,170.7
Selling, general and administrative expenses 212.5 (18.7) 193.8
Depreciation 52.1 (7.2) 44.9
Amortization of excess purchase price
over net assets acquired 13.4 (1.5) 11.9
Interest expense and finance charges 55.9 (8.9)(b) 47.0
------- ----- --------
Earnings before income taxes and equity in
earnings of unconsolidated subsidiaries 15.3 (6.1) 9.2
Provision for income taxes 6.9 (2.6)(c) 4.3
------- ----- --------
Earnings before equity in earnings of
unconsolidated subsidiaries 8.4 (3.5) 4.9
Equity in earnings of Loomis Fargo - 3.3 (d) 3.3
------- ----- --------
Earnings from continuing operations $8.4 ($0.2) $8.2
======= ===== ========
Earnings per share from continuing operations $0.36 $0.35
Average shares outstanding (thousands) 23,399 23,399
</TABLE>
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BORG-WARNER SECURITY CORPORATION
PRO FORMA CONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)
9 MONTHS ENDED SEPTEMBER 30, 1996
(MILLIONS OF DOLLARS EXCEPT PER SHARE)
<TABLE>
<CAPTION> <C> <C> <C>
<S> Pro Forma
Historical Adjustments (a) Pro Forma
---------- ------------- ---------
Net service revenue $1,267.3 ($182.3) $1,085.0
Cost of services 1,010.0 (153.4) 856.6
Selling, general and administrative
expenses 156.7 (13.8) 142.9
Depreciation 35.6 (5.2) 30.4
Amortization of excess purchase
price over net assets acquired 10.1 (1.1) 9.0
Interest expense and finance
charges 42.7 (7.1)(b) 35.6
---------- ------------- --------
Earnings before income taxes
and equity in earnings of
unconsolidated subsidiaries 12.2 (1.7) 10.5
Provision for income taxes 4.5 (0.9)(c) 3.6
---------- ------------- --------
Earnings before equity in
earnings of unconsolidated
subsidiaries 7.7 (0.8) 6.9
Equity in earnings of Loomis
Fargo -- 1.9 (d) 1.9
---------- ------------- --------
Earnings from continuing
operations $ 7.7 $ 1.1 $ 8.8
========== ============= =========
Earnings per share from continuing
operations $ 0.33 $ 0.38
Average shares outstanding
(thousands) 23,502 23,502
</TABLE>
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BORG-WARNER SECURITY CORPORATION
PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED)
SEPTEMBER 30, 1996
(MILLIONS OF DOLLARS)
<TABLE>
<CAPTION>
Pro Forma
Historical Adjustments (e) Pro Forma
---------- ----------- ---------
<S> <C> <C> <C>
ASSETS
Cash and cash equivalents $ 17.3 - $ 17.3
Receivables, net 99.9 $(28.9) 71.0
Inventories 12.6 (1.8) 10.8
Other current assets 31.4 10.5 (b) 41.9
---------- ----------- ---------
Total current assets 161.2 (20.2) 141.0
Property, plant and equipment, at cost 446.1 (79.9) 366.2
Less accumulated depreciation 234.1 (49.0) 185.1
---------- ----------- ---------
Net property, plant and equipment 212.0 (30.9) 181.1
Net excess purchase price over net assets acquired 240.3 (27.8) 212.5
Deferred tax asset 62.3 - 62.3
Net assets of discontinued operations 11.5 - 11.5
Investment in Loomis Fargo - 5.3 (d) 5.3
Other assets 88.3 (4.2) 84.1
---------- ----------- ---------
Total assets $775.6 $(77.8) $697.8
========== =========== =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable $ 2.9 $ (0.7) $ 2.2
Accounts payable and accrued expenses 176.9 (11.8) 165.1
---------- ----------- ---------
Total current liabilities 179.8 (12.5) 167.3
Long-term debt 456.9 (91.0)(b) 365.9
Other long-term liabilities 109.5 25.7 (f) 135.2
Capital stock:
Common stock 0.2 - 0.2
Series I non-voting common stock - - -
Other stockholders' equity 29.2 - 29.2
---------- ----------- ---------
Total stockholders' equity 29.4 - 29.4
---------- ----------- ---------
Total liabilities and stockholders' equity $775.6 $(77.8) $697.8
========== =========== =========
</TABLE>
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BORG-WARNER SECURITY CORPORATION
SUPPLEMENTAL PRO FORMA FINANCIAL INFORMATION (UNAUDITED)
Notes to Pro Forma Statements of Earnings and Balance Sheet
- -----------------------------------------------------------
a To eliminate the historical revenues and expenses of WFAS and subsidiaries
for the respective periods presented.
b To eliminate debt retired with proceeds received from the transaction and to
adjust interest expense. Proceeds from the transaction, net of transaction
and related expenses, were approximately $105 million and were applied as
follows: decrease in borrowings under the term loan, $80 million; decrease in
borrowings under the revolving line of credit, $10 million; and increase in
interest-bearing cash deposits under the accounts receivable facility, $15
million. The interest expense adjustment was computed using the average
interest rates for the respective periods. Such rates were used because
management believes these rates would have been the same if the facilities
had been negotiated by the Company on a stand-alone basis without WFAS.
C To record the estimated income tax effect for the pro forma adjustments
described in Notes (a) and (b) for the respective periods.
d To recognize, under the equity method, the Company's 49% interest in the pro
forma net assets and earnings of Loomis, Fargo & Co.
e To eliminate the historical assets, liabilities and stockholder's equity of
WFAS and subsidiaries.
f To establish allowances for anticipated expenses incurred as a direct result
of the business combination and for purchase price adjustments under the
contribution agreement, including indemnifications and performance
guarantees.
