Integrated Security Systems, Inc.
announces plans to sell B&B ARMR
Carrollton, Texas – December 20, 2010 –
Integrated Security Systems, Inc. (OTCB:IZZI)
announced that it has entered into an Asset
Purchase Agreement for the sale of substantially
all of the assets of B&B ARMR to an affiliate of
Strait Lane Capital Partners, LLC of Dallas,
Texas. The sale
includes substantially all of the accounts
receivable, inventory, fixed assets and
intellectual property of B&B ARMR, plus
its investment in the joint venture, B&B
Roadway.
The purchase price to be paid to the Company is
$6 million, subject to certain potential
adjustments. In addition, the buyer agreed to
assume certain of B&B ARMR’s liabilities. The
purchase price is made up of a cash payment in
the amount of $5,550,000 and a promissory note
in the original principal amount of $450,000.
At the closing, ninety-five percent (95%) of the
cash portion of the purchase price will be paid
to the Company, subject to certain adjustments,
and the remaining five percent (5%) will be
deposited into escrow. Of the cash portion of
the proceeds from the sale, $450,000 will be
used by the Company to make an equity investment
in the buyer’s parent company, B&B Roadway
Holdings, LLC, a newly-formed Delaware limited
liability company. Employees of B&B ARMR will
be offered employment by the buyer.
The Board approved the Asset Sale because it
believes it was the strategic alternative most
likely to maximize stockholder value. In
reaching its conclusion to approve the Asset
Sale, the Board reviewed and considered the
Company’s current condition and future
prospects, including its financial condition and
related concerns over continuing as a going
concern and the resulting difficulty in
investing in new products. The Board also
reviewed and considered the value of the
Company’s assets, claims and obligations, and
other strategic alternatives for the Company,
including the risks associated with these
alternatives. After considering these factors
and alternatives, the Board determined that the
Asset Sale was advisable, and in the best
interests of the Company, its stockholders and
creditors and that the Company should proceed
with the Asset Sale.
Following the Asset Sale, the Company will
retain the net proceeds of the Asset Sale, but
will not be actively conducting any business.
The Company will actively seek a merger,
acquisition or similar business combination with
another company to again be engaged in an active
business. In the interim, the Company’s Common
Stock will continue to be traded and the Company
intends on keeping all of its SEC filings
up-to-date.
The closing of the Asset Sale is expected to
occur as soon as practicable after satisfaction
of each of the closing conditions set forth in
the Purchase Agreement, but, in any event, under
applicable rules of the SEC, no earlier than
twenty (20) days after the mailing of an
Information Statement to stockholders. Closing
is also conditioned on the buyer concurrently
closing on the purchase of the assets of Causey
Lyon Enterprises, Inc., the Company’s joint
venture in B&B Roadway and a principal supplier
to B&B ARMR. At this time, the Company
anticipates mailing the Information Statement on
or about January 7th, 2011.
The Company is also asking its stockholders to
approve a Reverse Stock Split at an exchange
ratio of one-for-one-hundred (1:100). The
Board believes that the large number of shares
outstanding (and the resulting low market price
per share) was neither in the Company’s or its
stockholders’ best interests.
A Meeting of Stockholders will be
held on January 31, 2011 at the Company’s
principal executive offices for the purpose of
considering and voting upon the Asset Sale and
Reverse Stock Split. The Record Date for
Stockholders is December 15, 2010.
This news release contains forward-looking
statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of
1934, as amended. Forward-looking statements
include statements regarding our expectations,
beliefs, intentions, plans, projections,
objectives, goals, strategies, future events or
performance and underlying assumptions and other
statements which are not historical facts.
Actual results may differ materially from those
expressed or implied by the forward-looking
statements contained in this release.
Forward-looking statements are subject to
numerous risks, uncertainties and assumptions
about us and our business. Important factors
that could cause actual results to differ
materially from those in the forward looking
statements include the discussion of financial
position and liquidity discussed in Part I of
our Form 10-K Report for the year ended June 30,
2010, including but not limited to the
“Management's Discussion and Analysis of
Financial Condition and Results of Operations”,
which discussion is incorporated herein by this
reference. Readers are cautioned not to place
undue reliance on these forward-looking
statements, which speak only as of the date
hereof. We do not undertake to release publicly
any revisions to these forward-looking
statements to reflect events or circumstances
after the date hereof or to reflect the
occurrence of unanticipated events. For those
statements, we claim the protection of the safe
harbor for forward-looking statements contained
in the Private Securities Litigation Reform Act
of 1995.
About ISSI
Headquartered in Carrollton, Texas, ISSI
designs, develops and markets security and
traffic control products to the commercial,
industrial and governmental sectors. ISSI is a
leading provider of anti-terrorist barriers,
security gates and gate operators for perimeter
security applications through its subsidiary,
B&B ARMR. ISSI also designs, manufactures and
distributes warning gates, lane changers,
airport and navigational lighting through its
subsidiary, B&B Roadway. For more information,
please visit
www.integratedsecurity.com,
www.bb-armr.com, www.bbroadway.com.
