SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report: November 10, 2000
(Date of Earliest Event Reported)
COMMAND SECURITY CORPORATION
(Exact name of Registrant as Specified in its Charter)
New York
(State of Incorporation)
0-18684
(Commission File Number)
14-1626307
(IRS Employer Identification No.)
Lexington Park, Lagrangeville, New York 12540
(Address of Principal Executive Offices)
(914) 454-3703
(Registrant's Telephone Number)
<PAGE>
Item 1-Item 4 Not Applicable.
Item 5 Other Events.
On November 15, 2000, the Company's shareholder's approved
the issuance of the Reliance and Vassell Warrants and the
Stock Option Plan. The Warrants and Plan are described in
the Company's 8-K filed with the Securities and Exchange
Commission on September 27, 2000.
In accordance with the terms of the Stock Purchase Agreement
dated September 12, 2000 by and between Reliance Security
Group plc ("Reliance") and certain selling shareholders,
a copy of which has been filed as Exhibit 99.13 to the
Company's Form 8-K filed on September 27, 2000, Reliance
has purchased 2,914,921 shares and share equivalents of
Command's Common Stock. As agreed, the Company's board of
directors has been reconstituted based on the resignations
of Mssrs. Robinett, Peter Kikis, Sands, Saunders and Thomas
Kikis. Mssrs. Haslehurst and Allison have been designated
as two of the four new directors. Pursuant to the terms of
the Shareholder's Agreement filed as Exhibit 99.19 to the
Company's 8-K filed on September 27, 2000, Reliance will
designate one more director and Mr. Vassell and Reliance
will jointly designate one director. These designations
are expected within thirty days.
William C. Vassell has been elected President, Chief
Executive Officer and Chairman of the Board. The Reliance
Warrant and the Vassell Warrants, as described in the
September 27, 2000 8-K have been issued and the court order
dismissing the 1997 Litigation has been signed by the judge.
The results of the shareholder vote at the special meeting
on November 13, 2000, were as follows:
Proposal #1 (Approval of the issuance of Reliance
and Vassell Warrants) - For 3,443,009 (54.76%);
Against 98,191 (1.56%); Abstain 12,000 (.19%).
Proposal #2 (Approval of the 2000 Stock Option Plan) -
For 3,245,866 (51.63%); Against 296,834 (4.72%);
Abstain 10,500 (.17%).
Proposal #3 (Approval of Amendment to Article Tenth
of the Company's certificate of incorporation) -
For 3,520,046 (55.99%); Against 22,054 (.35%);
Abstain 11,100 (.18%). Proposal #3 required the
approval of the holders of 75% of all outstanding
shares and was not approved.
Item 6 Not Applicable.
Item 7 Financial Statements and Exhibits.
(a),(b) Not Applicable.
(c) Exhibits.
99.1 Press release dated November 10, 2000.
99.2 Press release dated November 14, 2000.
Item 8 Not Applicable.
Item 9 Not Applicable.
<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 hereunto duly authorized.
Date: November 15, 2000
COMMAND SECURITY CORPORATION
By: /s/ William C. Vassell
-------------------------------------
William C. Vassell
Chairman of the Board,
President and Chief Executive Officer
<PAGE>
FOR IMMEDIATE RELEASE
CONTACT: William C. Vassell Donald Radcliffe
Chairman Radcliffe & Associates, Inc.
Tel: (914) 454-3703 Tel: (212) 605-0174
COMMAND SECURITY CORPORATION RELEASES
RESULTS FOR SECOND FISCAL QUARTER
o REVENUES UP MORE THAN 20% FOR QUARTER COMPARED TO INDUSTRY AVERAGE OF 7%
o NET LOSS FOR QUARTER ATTRIBUTED TO COSTS ASSOCIATED WITH RAMP UP OF
BUSINESS, REDUCED GROSS MARGINS AND EXPENSES ASSOCIATED WITH RESOLUTION
OF STOCKHOLDERS DERIVATIVE SUIT
o RECEIVES NEW BANKING FACILITY WHICH INCREASES CURRENT AVAILABILITY BY
$2.5 MILLION AND REDUCES INTEREST EXPENSE
Lagrangeville, New York *** November 10, 2000 *** Command Security
Corporation (OTC/BB:CMMD) today released results for its second fiscal
quarter ended September 30, 2000. For the quarter revenues increased by 20.4%
to $18,322,148 from the $15,217,897 reported for the same period in the prior
year. For the six months ended September 30, 2000 revenues increased by 20.3%
to $34,439,813 from the $28,620,529. Increases in revenues were achieved
through additional new clients, expansion of service to existing clients and
rate increases. Growth in revenues from services provided to commercial
airlines and ATM servicing was particularly strong.
Gross profit, as a percentage of revenue, was 16.0% for the quarter ended
September 30, 2000 compared to 18.8% for the quarter ended September 30,
1999. For the six-month period ended September 30, 2000 the gross profit
percentage was 16.3% compared to 18.6% in the same period of the prior fiscal
year.
Net income applicable to common shareholders was $(462,585) or $(.07) per
share for the quarter compared to $495,139 or $.07 per share in the same
quarter of the prior fiscal year. For the six month period net income
applicable to common shareholders was $(433,152) or $(.07) per share compared
to $643,899 or $.10 per share in the same period of the prior fiscal year.
- more -
<PAGE>
Commenting on the results, William C. Vassell, Chairman said, "We were
pleased to report continued growth in our revenue base at a greater than 20%
rate over the prior year, despite the loss of one of our major clients, Tower
Air, due to bankruptcy. This growth rate is particularly significant since it
is estimated that the current industry growth rate is approximately 7%."
Mr. Vassell added, "During the quarter we incurred a substantial amount of
overtime and start-up expenses associated with our ramp-up of new business.
Additionally, general and administrative expenses increased for the quarter
due to an increase in staff and expense associated with the Company's rapid
internal growth. We expect these costs to decrease in the future periods.
Also during the quarter we had a charge of $373,746 associated with the
stockholders derivative suit and related expenses which we do not expect to
continue."
Command also announced today that it has closed on a new loan facility with
LaSalle Business Credit Inc. which provides the company with an overall
credit facility of $18,000,000 of which $3,000,000 is a term loan. This
provides the Company with current excess cash availability of approximately
$2.5 million with which to finance its growth objectives. The new financing
arrangement is expected to result in annualized interest savings of
approximately $150,000 per year over the three years of the arrangement,
based upon current levels of borrowings. These savings will be partially
offset by $125,000 one-time termination fee payable to CIT.
About Command
Command Security Corporation provides security services through company-owned
offices in New York, New Jersey, California, Illinois, Connecticut, Florida,
Georgia, Massachusetts and Pennsylvania and provides services via independent
security companies nationwide.
Statements in this press release other than statements of historical fact are
"forward-looking statements." Such statements are subject to certain risks
and uncertainties including the demand for the Company's services,
litigation, labor market, and other risk factors identified from time to time
in the Company's filings with the Securities and Exchange Commission that
could cause actual results to differ materially from any forward looking
statements. These forward-looking statements represent the Company's judgment
as of the date of this release. The Company disclaims, however, any intent or
obligation to update these forward-looking statements.
<PAGE>
<TABLE>
COMMAND SECURITY CORPORATION
Condensed Statements of Operation
<CAPTION>
Quarter Ended Six Months Ended,
September 30, September 30,
----------------------------------- ----------------------------------
2000 1999 2000 1999
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues $18,322,148 $15,217,897 $34,439,813 $28,620,529
Operating Profit 149,870 678,397 353,257 987,638
Net Income/(loss) (421,912) 550,969 (351,805) 740,403
Preferred stock dividends (40,673) (55,830) (81,347) (96,504)
----------- ----------- ----------- -----------
Net income applicable
to common shareholder $ (462,585) $ 495,139 $ (433,152) $ 643,899
=========== =========== =========== ===========
Net income per
common shares $ (.07) $ .07 $ (.07) $.10
=========== =========== =========== ===========
Weighted average
number of common
shares outstanding 6,287,343 6,658,143 6,287,343 6,658,143
=========== =========== =========== ===========
</TABLE>
<PAGE>
FOR IMMEDIATE RELEASE
CONTACT: William C. Vassell Donald Radcliffe
Chairman Radcliffe & Associates, Inc.
Tel: (914) 454-3703 Tel: (212) 605-0174
COMMAND SECURITY CORPORATION ANNOUNCES
o SHAREHOLDERS APPROVE RELIANCE TRANSACTION
o DERIVATIVE LAWSUIT TERMINATED
o BOARD RECONSITITUTED
o NEW EMPLOYMENT AGREEMENT FOR WILLIAM C. VASSELL
Lagrangeville, New York *** November 14, 2000 *** Command Security
Corporation (NASDAQ:CMMD) announced today that Shareholders have approved the
transaction which was previously announced on September 13, 2000 in which
Reliance Security Group plc (LSE:RSG) will purchase common shares, preferred
shares, and options which represent approximately 38% of the outstanding
common stock of the Company on a fully diluted basis from outside
shareholders and directors. As part of this transaction the Company will
issue Reliance a five-year warrant to purchase 20% of the outstanding common
stock of the Company on a fully diluted basis at $1.25 per share.
As a result of this transaction, the dissident Shareholder and directors have
terminated their lawsuit entitled Rosen v. Vassell, et al., relinquished
their seats on the Board and terminated a shareholder agreement to which they
were a party.
The Board has been reconstituted, pursuant to a new shareholder agreement in
which Mr. Vassell and Reliance will each designate three directors to a Board
of seven members. The seventh Director will be jointly appointed by Mr.
Vassell and Reliance.
Mr. William C. Vassell has entered into a new three-year employment
agreement and will become President, Chief Executive Officer and Chairman of
Command.
- more -
<PAGE>
Mr. Vassell said, "We are extremely gratified that Reliance shares our vision
for the future. They will bring to the Board valuable experience and insight
which should help Command's expansion. I am pleased that Reliance sees the
potential future value of the Company which is evidenced by the $2.20 per
share which they paid to acquire their shares."
Mr. Vassell added, "We expect to continue our rapid growth which has
generated in excess of 20% revenue growth for the first six months of fiscal
2001 compared to a 7% industry average. The new loan facility from LaSalle
Business Credit Inc. which we closed on Friday will help fuel this growth and
the elimination of the lawsuit will allow management to concentrate on
building the business."
About Reliance
Reliance is an established market leader, one of the four largest UK
operators, in the provision of contract security management, manpower,
electronic surveillance and related support services. The company employs
approximately 8,000 people from a network of offices throughout Great
Britain. In its year ended April 28, 2000 the company reported revenues of
approximately (pound)150,000,000 with profit before tax of more than
(pound)8.5 million.
About Command
Command Security Corporation provides security services through company-owned
offices in New York, New Jersey, California, Illinois, Connecticut, Florida,
Georgia, Massachusetts and Pennsylvania and provides services via independent
security companies nationwide.
Statements in this press release other than statements of historical fact are
"forward-looking statements." Such statements are subject to certain risks
and uncertainties including the demand for the Company's services,
litigation, labor market, and other risk factors identified from time to time
in the Company's filings with the Securities and Exchange Commission that
could cause actual results to differ materially from any forward looking
statements. These forward-looking statements represent the Company's judgment
as of the date of this release. The Company disclaims, however, any intent or
obligation to update these forward-looking statements.
