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Mace Announces Paolino Arbitration Decision

May 06, 2010
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According to Business Wire, Mace Security International, Inc., announced that an arbitration panel of the American Arbitration Association awarded Louis D. Paolino, the former Chief Executive Officer of Mace, the sum of $4,148,912 in connection with Paolino’s claims against the Mace. As previously disclosed in Mace’s filings under the Securities Exchange Act of 1934, Mace and Paolino have been waiting for a decision in the Arbitration Proceeding, described in the Mace’s Form 10-K for year ended 2009. The arbitration panel found that Paolino did not engage in willful misconduct, and was therefore entitled to a severance payment under his Employment Agreement upon his termination as Chief Executive Officer of the Company on May 20, 2008. The award consists of $3,851,000, as the severance payment due under Paolino’s Employment Agreement, plus interest and a payment of $1,000 for Paolino’s defamation claim. The panel dismissed Paolino’s claim for additional stock options having the value of $322,606, but directed Mace to rescind the cancellation of 1,769,682 options, which were cancelled by Mace upon Paolino’s termination. Paolino was given until July 10, 2010 to exercise these restored options. The panel also denied Mace’s counterclaim for conversion of its property by Paolino and held that there was no basis for imposition of punitive damages.
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