CLEVELAND, OH / ACCESSWIRE / October 16, 2024 / Mace Security International, Inc. (OTCQB:MACE) ("Mace") today, following an extensive strategic alternatives process, announced that Mace and W Electric Intermediate Holdings, LLC have entered into a definitive Agreement and Plan of Merger ("Merger Agreement") for a business combination that will result in Mace becoming a wholly-owned subsidiary of W Electric Intermediate Holdings, LLC. Headquartered in Pittsburgh, Pennsylvania, W Electric Intermediate Holdings, LLC is the parent company of a global brand operator and value-added distributor of consumer and industrial products. Under the terms of the Merger Agreement, a wholly owned subsidiary of W Electric Intermediate Holdings, LLC will merge with and into Mace and the holders of the outstanding Mace shares will receive cash in exchange for their shares. The Merger Agreement provides for merger consideration of $6,000,000 on a cash-free, debt-free basis, to be adjusted for closing cash, closing indebtedness, closing working capital, and selling expenses. $500,000 of the merger consideration will be held in escrow for 12 months following the closing. Mace projects per share cash proceeds to shareholders, after payment of indebtedness and other items provided in the Merger Agreement, to be between $0.016 and $0.0235, depending on whether any escrow funds are released for post-closing claims, plus a potential additional upward adjustment as part of the post-closing working capital adjustment in the Merger Agreement. Mace's Board of Directors has unanimously approved the Merger Agreement. The proposed merger is subject to customary closing conditions, including the approval of the proposed merger by Mace's shareholders. Pursuant to the Merger Agreement, W Electric Intermediate Holdings paid Mace a refundable $300,000 interest free earnest money deposit to be used for working capital prior to the closing. The closing of the transaction is anticipated to occur prior to the end of 2024 upon and subject to shareholder approval of the transaction.
Mace has made representations, warranties and covenants in the Merger Agreement, including, among others, to convene and hold a meeting of its shareholders for the purpose of obtaining approval of the Merger Agreement by shareholders entitled to exercise a majority of the voting power of Mace (the "Company Requisite Approval").
The Merger Agreement contains certain termination rights, including that either party may terminate the Merger Agreement if, subject to certain limitations, the Merger has not closed on or before January 10, 2025. Additionally, Mace may terminate the Merger Agreement under specified circumstances to accept an unsolicited Superior Proposal (as defined in the Merger Agreement) from a third party before the Company Requisite Approval has been obtained, and W Electric Intermediate Holdings may terminate the Merger Agreement if, before the Company Requisite Approval has been obtained, the Mace Board of Directors changes its recommendation that Mace's stockholders adopt the Merger Agreement.
The Merger Agreement provides that Mace will be required to pay W Electric Intermediate Holdings a termination fee of $500,000 if the Merger Agreement is terminated under specified circumstances in which the Mace Board of Directors changes its recommendation that Mace's stockholders adopt the Merger Agreement, or Mace terminates the Merger Agreement in order to accept a Superior Proposal as set forth in the Merger Agreement.
The Merger Agreement also provides that Mace may require W Electric Intermediate Holdings to pay Mace a termination fee of $500,000 (minus the unrefunded deposit amount) if Mace terminates the Merger Agreement as a result of W Electric Intermediate Holdings' failure to pay the merger consideration under the terms of the Merger Agreement if the conditions to closing have been satisfied.
The foregoing description of the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the Merger Agreement, which shall be publicly filed with the OTC QB and is incorporated herein by reference.
The Merger Agreement filing is intended to provide investors with information regarding the Merger Agreement's terms. It is not intended to provide any other factual information about W Electric Intermediate Holdings, Mace or any of their respective affiliates. The representations, warranties and covenants contained in the Merger Agreement were made only for purposes of the Merger Agreement as of the specific date therein, were solely for the benefit of the parties to the Merger Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk among the parties to the Merger Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under the Merger Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in Mace's public disclosures. The Merger Agreement should not be read alone but should instead be read in conjunction with the other information regarding the parties that is or will be contained in, or incorporated by reference into filings and documents that Mace has filed or will file with the OTCQB.
About Mace Security International, Inc.
Mace® Security International, Inc. (MACE) is a globally recognized leader in personal safety and security. Based in Cleveland, Ohio, Mace has spent more than 40 years designing and manufacturing consumer and tactical products for personal defense and security under its world-renowned Mace® Brand - the original trusted brand of defense spray products. Mace also offers aerosol defense sprays and tactical products for law enforcement and security professionals worldwide through its Mace® Take Down® brand, KUROS!® Brand personal safety products, Vigilant® Brand alarms, and Tornado® Brand pepper spray and stun guns. MACE® distributes and supports Mace® Brand products through mass market retailers, wholesale distributors, independent dealers, Amazon.com, Mace.com, and other channels. For more information, visit www.mace.com.
Forward-Looking Statements
Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. When used, the words or phrases "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "projected," "intend to" or similar expressions are intended to identify "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to several known and unknown risks and uncertainties that may cause our actual results, trends, performance or achievements, or industry trends and results, to differ materially from the future results, trends, performance, or achievements expressed or implied by such forward-looking statements. Those risks and uncertainties may include, but are not limited to, (a) general economic and business conditions, including the impact of the COVID-19 pandemic and other possible pandemics and similar outbreaks; (b) competition; (c) potential changes in customer spending; (d) acceptance of our product offerings and designs; (e) the variability of consumer spending resulting from changes in domestic economic activity; (f) a highly promotional retail environment; (g) any significant variations between actual amounts and the amounts estimated for those matters identified as our critical accounting estimates, as well as other significant accounting estimates made in the preparation of our financial statements; (h) the impact of current and potential hostilities in various parts of the world, including but not limited to the war which resulted from Russia's invasion of Ukraine, as well as other geopolitical or public health concerns; (i) the impact of international supply chain disruptions and delays; (j) the impact on Mace of changes in U.S. Federal and State income tax regulations; and (k) the impact of inflation and the ability of Mace to pass on rising prices to its customers. You are urged to consider all such factors. Because of the uncertainty inherent in such forward-looking statements, you should not consider their inclusion to be a representation that such forward-looking matters will be achieved. Mace Security International, Inc. assumes no obligation for updating any such forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking statements.
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SOURCE: Mace Security International, Inc.