-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, NXE0HFiKKU8Lb+88SXBAG/lOPTYSoSwkAUcsNjFppTw+oNLJfxx5MrTDRAeCPhIO d7K66WNbyrGIRbWWd1IteA== 0000902664-07-002068.txt : 20070622 0000902664-07-002068.hdr.sgml : 20070622 20070622081957 ACCESSION NUMBER: 0000902664-07-002068 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20070622 DATE AS OF CHANGE: 20070622 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CLINTON GROUP INC CENTRAL INDEX KEY: 0001134119 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 32 OLD SLIP 5TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10005 BUSINESS PHONE: 2128250400 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CHINA SECURITY & SURVEILLANCE TECHNOLOGY, INC. CENTRAL INDEX KEY: 0001260625 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-MANAGEMENT SERVICES [8741] IRS NUMBER: 000000000 STATE OF INCORPORATION: D8 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-80530 FILM NUMBER: 07935125 BUSINESS ADDRESS: STREET 1: ROOMS 3505-06, 35TH FLOOR STREET 2: EDINBURGH TOWER, THE LANDMARK CITY: 15 QUEEN'S ROAD CENTRAL STATE: K3 ZIP: 00000 BUSINESS PHONE: 852 2736 2111 MAIL ADDRESS: STREET 1: ROOMS 3505-06, 35TH FLOOR STREET 2: EDINBURGH TOWER, THE LANDMARK CITY: 15 QUEEN'S ROAD CENTRAL STATE: K3 ZIP: 00000 FORMER COMPANY: FORMER CONFORMED NAME: APEX WEALTH ENTERPRISES LTD DATE OF NAME CHANGE: 20030820 SC 13D 1 sc13d.txt CHINA SECURITY & SURVEILLANCE TECHNOLOGY, INC. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------- SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) Under the Securities Exchange Act of 1934 (Amendment No. )* China Security & Surveillance Technology, Inc. - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, $0.0001 par value - -------------------------------------------------------------------------------- (Title of Class of Securities) G21161107 - -------------------------------------------------------------------------------- (CUSIP Number) Marc Weingarten, Esq. Schulte Roth & Zabel LLP 919 Third Avenue New York, New York 10022 (212) 756-2000 - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) June 21, 2007 - -------------------------------------------------------------------------------- (Date of Event which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. [ ] NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 12 Pages) - -------------------------- * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). - ------------------------------ --------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 2 OF 12 PAGES - ------------------------------ --------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) CLINTON GROUP, INC. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ---------------------------------------------------------- NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 1,749,117 OWNED BY ---------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON WITH -0- ---------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,749,117 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON 1,749,117 - -------------------------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.0% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IA; CO - -------------------------------------------------------------------------------- * SEE INSTRUCTIONS - ------------------------------ --------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 3 OF 12 PAGES - ------------------------------ --------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) CLINTON MULTISTRATEGY MASTER FUND, LTD. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION CAYMAN ISLANDS - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ---------------------------------------------------------- NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 1,579,946 OWNED BY ---------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON WITH -0- ---------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,579,946 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON 1,579,946 - -------------------------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.5% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO - -------------------------------------------------------------------------------- * SEE INSTRUCTIONS - ------------------------------ --------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 4 OF 12 PAGES - ------------------------------ --------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION CAYMAN ISLANDS - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ---------------------------------------------------------- NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 169,171 OWNED BY ---------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON WITH -0- ---------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 169,171 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON 169,171 - -------------------------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.5% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO - -------------------------------------------------------------------------------- * SEE INSTRUCTIONS - ------------------------------ --------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 5 OF 12 PAGES - ------------------------------ --------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) GEORGE HALL - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - -------------------------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION UNITED STATES - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ---------------------------------------------------------- NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 1,749,117 OWNED BY ---------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON WITH -0- ---------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,749,117 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON 1,749,117 - -------------------------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.0% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- * SEE INSTRUCTIONS - ------------------------------ --------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 6 OF 12 PAGES - ------------------------------ --------------------- - -------------------------------------------------------------------------------- 1 NAME OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) CONRAD BRINGSJORD - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - -------------------------------------------------------------------------------- 5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION UNITED STATES - -------------------------------------------------------------------------------- 7 SOLE VOTING POWER -0- ---------------------------------------------------------- NUMBER OF 8 SHARED VOTING POWER SHARES BENEFICIALLY 1,749,117 OWNED BY ---------------------------------------------------------- EACH 9 SOLE DISPOSITIVE POWER REPORTING PERSON WITH -0- ---------------------------------------------------------- 10 SHARED DISPOSITIVE POWER 1,749,117 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON 1,749,117 - -------------------------------------------------------------------------------- 12 CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 5.0% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN - -------------------------------------------------------------------------------- * SEE INSTRUCTIONS - ------------------------------ --------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 7 OF 12 PAGES - ------------------------------ --------------------- Item 1. SECURITY AND ISSUER. This statement relates to the shares of Common Stock, $0.0001 par value per share (the "Shares"), of China Security & Surveillance Technology, Inc., a Delaware corporation (the "Issuer"). The principal executive office of the Issuer is located at 13/F, Shenzhen Special Zone Press Tower, Shennan Road, Futian District, Shenzhen, China 518034. ITEM 2. IDENTITY AND BACKGROUND. (a) This statement is filed by Clinton Group, Inc., a Delaware corporation ("CGI"), Clinton Multistrategy Master Fund, Ltd., a Cayman Islands company ("CMSF"), Clinton Special Opportunities Master Fund, Ltd., a Cayman Islands company ("CSO"), George Hall and Conrad Bringsjord (collectively, the "Reporting Persons"). (b) The principal business address of CGI, George Hall and Conrad Bringsjord is 9 West 57th Street, 26th Floor, New York, New York 10019. The principal business address of CMSF and CSO is c/o Fortis Fund Services (Cayman) Limited, P.O. Box 2003 GT, Grand Pavilion Commercial Centre, 802 West Bay Road, Grand Cayman, Cayman Islands. (c) The principal business of CGI is investing for funds and accounts under its management. The principal business of CMSF and CSO is to invest in securities. George Hall is the Chief Investment Officer and President of CGI. Conrad Bringsjord is a managing director and senior portfolio manager of CGI. (d) None of the Reporting Persons nor any of the individuals set forth in Schedule A attached hereto has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). (e) None of the Reporting Persons nor any of the individuals set forth in Schedule A attached hereto has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) George Hall and Conrad Bringsjord are citizens of the United States of America. The name, citizenship, present principal occupation or employment and business address of each director and executive officer of CGI, CMSF and CSO is set forth in Schedule A attached hereto. To the best of the Reporting Persons' knowledge, except as set forth in this statement on Schedule 13D, none of such individuals owns any Shares. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. Funds for the purchase of the Shares reported herein were derived from available capital of CMSF and CSO. A total of approximately $21 million was paid to acquire such Shares. - --------------------------- ------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 8 OF 12 PAGES - --------------------------- ------------------- ITEM 4. PURPOSE OF TRANSACTION. The Reporting Persons originally acquired Shares for investment in the ordinary course of business because they believed that the Shares, when purchased, were undervalued and represented an attractive investment opportunity. On June 21, 2007, CGI sent a letter to the Issuer's Chairman and CEO, Mr. Guoshen Tu, to express its support of the Issuer's management and its excitement about the Issuer's growth prospects. The letter states that given CGI's position as one of the Issuer's largest investors and the recent performance of the Issuer's stock price, CGI thought it appropriate to detail its ideas with regards to the strategic direction and financial management of the company. CGI explains that it has a long-term view regarding its investment in the Issuer and offers itself as a sounding board for the Issuer's management team in discussing value maximization opportunities. A copy of this letter is attached hereto as Exhibit B and is incorporated herein by reference. Except as set forth herein or as would occur upon completion of any of the actions discussed herein, including in any Exhibits hereto, the Reporting Persons have no present plan or proposal that would relate to or result in any of the matters set forth in subparagraphs (a)-(j) of Item 4 of Schedule 13D. The Reporting Persons intend to review their investment in the Issuer on a continuing basis and may engage in discussions with management, the board of directors, other shareholders of the Issuer and other relevant parties concerning the business, operations, management, strategy and future plans of the Issuer. Depending on various factors including, without limitation, the Issuer's financial position and strategic direction, the outcome of the discussions and actions referenced above, actions taken by the board of directors, price levels of the Shares, other investment opportunities available to the Reporting Persons, conditions in the securities market and general economic and industry conditions, the Reporting Persons may in the future take such actions with respect to their investment in the Issuer as they deem appropriate including, without limitation, purchasing additional Shares or selling some or all of their Shares, engaging in short selling of or any hedging or similar transactions with respect to the Shares and/or otherwise changing their intention with respect to any and all matters referred to in Item 4 of Schedule 13D. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. (a) As of the close of business on June 21, 2007, the Reporting Persons beneficially owned an aggregate of 1,749,117 Shares, constituting approximately 5.0% of the Shares outstanding. The aggregate percentage of Shares beneficially owned by the Reporting Persons is based upon 34,942,206 Shares outstanding, which is the total number of Shares outstanding as of May 10, 2007 as reported in the Issuer's Quarterly Report on Form 10-Q for the period ended March 31, 2007. (b) By virtue of investment management agreements with each of CMSF and CSO, CGI has the power to vote or direct the voting, and to dispose or direct the disposition, of all of the 1,579,946 Shares held by CMSF and the 169,171 Shares held by CSO. By virtue of his direct and indirect control of CGI, George Hall is deemed to have shared voting power and shared dispositive power with respect to all Shares as to which CGI has voting power or dispositive power. By virtue of his position as managing director and senior portfolio manager of CGI, Conrad Bringsjord is also deemed to have shared voting power and shared dispositive power with respect to all Shares as to which CGI has voting power or dispositive power. Accordingly, CGI, George Hall and Conrad Bringsjord are deemed to have shared voting and shared dispositive power with respect to an aggregate of 1,749,117 Shares. - --------------------------- ------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 9 OF 12 PAGES - --------------------------- ------------------- (c) Information concerning transactions in the Shares effected by the Reporting Persons during the past sixty days is set forth in Schedule B hereto and is incorporated herein by reference. Unless otherwise indicated, all of such transactions were effected in the open market. (d) No person other than the Reporting Persons is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, the Shares. (e) Not applicable. Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. The Reporting Persons may, from time to time, enter into and dispose of cash-settled equity swap or other similar derivative transactions with one or more counterparties that are based upon the value of Shares, which transactions may be significant in amount. The profit, loss and/or return on such contracts may be wholly or partially dependent on the market value of the Shares, the relative value of Shares in comparison to one or more other financial instruments, indexes or securities, a basket or group of securities in which Shares may be included, or a combination of any of the foregoing. In addition to the Shares that they beneficially own without reference to these contracts, the Reporting Persons currently have short economic exposure to 25,000 Shares through such contracts. These contracts do not give the Reporting Persons direct or indirect voting, investment or dispositive control over any securities of the Issuer and do not require the counterparties thereto to acquire, hold, vote or dispose. Except as otherwise set forth herein, the Reporting Persons do not have any contract, arrangement, understanding or relationship with any person with respect to the securities of the Issuer. Item 7. MATERIAL TO BE FILED AS EXHIBITS Exhibit A - Joint Filing Agreement dated June 22, 2007 Exhibit B - Letter to Issuer's Chairman and CEO dated June 21, 2007 - --------------------------- ------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 10 OF 12 PAGES - --------------------------- ------------------- SIGNATURES After reasonable inquiry and to the best of his or its knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: June 22, 2007 CLINTON GROUP, INC. By: /s/ Francis Ruchalski --------------------------- Name: Francis Ruchalski Title: Comptroller CLINTON MULTISTRATEGY MASTER FUND, LTD. By: Clinton Group, Inc. its investment manager By: /s/ Francis Ruchalski --------------------------- Name: Francis Ruchalski Title: Comptroller CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD. By: Clinton Group, Inc. its investment manager By: /s/ Francis Ruchalski --------------------------- Name: Francis Ruchalski Title: Comptroller /s/ George Hall ------------------------------ George Hall /s/ Conrad Bringsjord ------------------------------ Conrad Bringsjord - --------------------------- ------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 11 OF 12 PAGES - --------------------------- ------------------- SCHEDULE A DIRECTORS AND EXECUTIVE OFFICERS OF CERTAIN REPORTING PERSONS The following sets forth the name, position and principal occupation of each director and executive officer of CGI. Each such person is a citizen of the United States of America. The business address of each director and executive officer is 9 West 57th Street, 26th Floor, New York, New York 10019. CLINTON GROUP, INC. Name Position - --------------------------- ------------------------------------------- George E. Hall Director and President John L. Hall Director and Chief Financial Officer Wendy Ruberti General Counsel and Assistant Secretary Francis A. Ruchalski Director and Comptroller Hani K. Findakly Director The following sets forth the name, citizenship, principal occupation and business address of each director of each of CMSF and CSO. There are no executive officers of CMSF and CSO. CLINTON MULTISTRATEGY MASTER FUND, LTD. Jane Fleming is a citizen of the United Kingdom. Her principal occupation is Client Accountant of Queensgate Bank & Trust Company Ltd. Her business address is Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South Church Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands. Dennis Hunter is a citizen of the United Kingdom. His principal occupation is Director of Queensgate Bank & Trust Company Ltd. His business address is Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South Church Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands. Roger Hanson is a citizen of the United Kingdom. His principal occupation is director of dms Management Ltd. His business address is dms Management Ltd., P.O. Box 31910 SMB, Ansbacher House, 20 Genesis Close, Grand Cayman, Cayman Islands. Blair Gauld is a citizen of New Zealand. His principal occupation is Director of Queensgate Bank & Trust Company Ltd. His business address is Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South Church Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands. CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD. Dennis Hunter's citizenship, principal occupation and business address are set forth above. Roger Hanson's citizenship, principal occupation and business address are set forth above. Cassandra Powell is a citizen of the Cayman Islands. Her principal occupation is Senior Manager of Queensgate Bank & Trust Company Ltd. Her business address is Queensgate Bank & Trust Company Ltd., Harbour Place, 5th Floor, 103 South Church Street, P.O. Box 30464 SMB, Grand Cayman, Cayman Islands. - --------------------------- ------------------- CUSIP NO. G21161107 SCHEDULE 13D PAGE 12 OF 12 PAGES - --------------------------- ------------------- SCHEDULE B TRANSACTIONS IN THE SHARES BY THE REPORTING PERSONS DURING THE PAST 60 DAYS Clinton Multistrategy Master Fund, Ltd. Trade Date Shares Purchased (Sold) Price Per Share ($) ---------- ----------------------- ------------------- 04/25/07 6,278 16.35 05/01/07 6,500 15.74 05/02/07 1,000 15.62 05/03/07 700 15.40 05/04/07 2,500 15.01 05/07/07 3,500 14.72 05/08/07 11,300 13.82 05/08/07 (2,500) 15.00 05/14/07 (2,500) 14.82 05/21/07 40,900 12.84 05/22/07 14,400 12.62 05/23/07 6,535 12.71 05/24/07 1,750 13.01 05/25/07 (8,000) 13.60 05/29/07 (12,000) 14.49 05/30/07 (7,500) 15.34 06/01/07 (237) 15.50 06/04/07 4,000 14.76 06/05/07 3,000 14.10 06/06/07 1,315 13.73 06/06/07 1,000 13.97 06/06/07 (1,000) 14.25 06/08/07 1,000 14.05 06/08/07 (1,100) 14.26 06/11/07 2,000 14.00 06/12/07 1,000 13.85 06/13/07 1,000 13.65 06/14/07 2,000 13.50 06/14/07 (500) 13.60 06/15/07 22,000 13.30 06/18/07 19,000 13.11 06/19/07 19,900 12.71 06/20/07 62,500 12.75 06/20/07 4,000 12.71 06/20/07 (1,200) 13.40 06/21/07 45,000 14.52 06/21/07 7,000 14.07 Clinton Special Opportunities Master Fund, Ltd. Trade Date Shares Purchased (Sold) Price Per Share ($) ---------- ----------------------- ------------------- 04/23/07 2,000 17.08 04/25/07 6,200 16.35 05/01/07 6,500 15.74 05/04/07 2,500 15.01 05/07/07 3,500 14.72 05/15/07 3,300 14.20 05/16/07 3,000 13.48 05/17/07 1,000 13.30 05/18/07 2,000 13.65 05/21/07 4,600 12.84 05/22/07 1,600 12.62 06/20/07 62,500 12.75 06/20/07 4,000 12.71 06/20/07 (1,300) 13.40 06/21/07 45,000 14.52 06/21/07 6,971 14.07 EX-99 2 exhibita.txt EXHIBIT A EXHIBIT A JOINT FILING AGREEMENT PURSUANT TO RULE 13d-1(k) The undersigned acknowledge and agree that the foregoing statement on Schedule 13D is filed on behalf of each of the undersigned and that all subsequent amendments to this statement on Schedule 13D may be filed on behalf of each of the undersigned without the necessity of filing additional joint filing agreements. The undersigned acknowledge that each shall be responsible for the timely filing of such amendments, and for the completeness and accuracy of the information concerning him or it contained herein and therein, but shall not be responsible for the completeness and accuracy of the information concerning the others, except to the extent that he or it knows or has reason to believe that such information is inaccurate. Dated: June 22, 2007 CLINTON GROUP, INC. By: /s/ Francis Ruchalski --------------------------- Name: Francis Ruchalski Title: Comptroller CLINTON MULTISTRATEGY MASTER FUND, LTD. By: Clinton Group, Inc. its investment manager By: /s/ Francis Ruchalski --------------------------- Name: Francis Ruchalski Title: Comptroller CLINTON SPECIAL OPPORTUNITIES MASTER FUND, LTD. By: Clinton Group, Inc. its investment manager By: /s/ Francis Ruchalski --------------------------- Name: Francis Ruchalski Title: Comptroller /s/ George Hall ------------------------------ George Hall /s/ Conrad Bringsjord ------------------------------ Conrad Bringsjord EX-99 3 exhibitb.txt EXHIBIT B EXHIBIT B LETTER TO ISSUER'S CHAIRMAN AND CEO CLINTON GROUP 6/21/2007 China Security & Surveillance Technology, Inc. 13/F, Shenzhen Special Zone Press Tower, Shennan Road Futian, Shenzhen, China, 518034 Attention: Mr. Guoshen Tu Chairman of the Board and Chief Executive Officer Dear Mr. Tu: As you know by our multiple discussions and meetings with you and several members of your management team, we have conducted industry and business due diligence on China Security & Surveillance Technology, Inc. ("China Security" or the "Company") and have been purchasing shares in the open market since last October. As of today, funds and accounts managed by Clinton Group Inc. ("Clinton") currently beneficially own approximately 5% of the outstanding shares. As one of the Company's largest investors, we thought it would be appropriate to detail to you our ideas with regards to the strategic direction and financial management of the Company. We are very supportive of your management team and view China Security as an attractive long-term investment. We hope you find this constructive and would welcome any follow-up discussions with you and your team. NO FURTHER ISSUANCE OF COMMON STOCK AT THESE LEVELS Clearly, a significant part of your strategy is to execute roll-up acquisitions and vertical integration acquisitions to grow your business. As a shareholder, we are supportive of your acquisition strategy and are confident in the integration capacity of your current management team. While your acquisitions are coming at attractive multiples and result in earnings accretion, we urge you to take steps to increase your share price and implied multiples to ensure that there is a significant arbitrage (and resulting EPS accretion) between your trading multiples and your acquisition multiples. Based on recent closing prices, we believe that your common stock is trading at an extremely low valuation in comparison to relevant companies. We would further note that China Security's implied multiple of 14.1x consensus 2007E EPS is not an entirely appropriate valuation metric as it is not pro forma for the current business after acquisitions. We note that the Company's PEG multiple has a tremendous discount. MULTIPLE INDICATIVE CSCT PRICE CSCT(1) COMPS(2) DISCOUNT AT COMP MULTIPLES ------- -------- -------- --------------------- Price / 2007 Earnings 14.1x 25.5x 44.5% $26.78 Price / 2008 Earnings 9.8z 20.2x 51.5% $30.64 PE/LT Growth 0.33x 1.25x 73.9% $56.89 - ------------------- (1) Closing price as of June 21, 2007. (2) Comparable companies group includes Checkpoint Systems Inc., FLIR Systems Inc., Nice Systems Ltd. and Napco Security Systems Inc. These companies do not have significant exposure to the explosive growth in China. Assuming a 20x 2008E PE multiple, the Company's stock should trade just north of $30.00 per share. Thus, we do not believe it is beneficial to issue any more stock to execute acquisitions until the valuation discrepancy closes, and the magnitude of accretion is higher to your shareholders. We believe your stock will be rewarded in the market by demonstrating further quarters of strong organic growth and smooth integration of the acquisitions already announced. CONTINUED INVESTOR RELATIONS EFFORT We recognize that your management team has worked diligently to take meetings with investors to communicate the China Security story. We have spoken to bulge-bracket investment banks about your story and believe that several more investment banks should pick up equity research coverage over time. We would be happy to make introductions with our equity research contacts. Currently, your stock price is at a large discount to the price targets of Brean Murray Carret & Co. and Maxim Group LLC at $20.00 and $23.00, so additional research coverage with investment banks with larger reach would certainly be beneficial. Given the exciting growth opportunity of the business and the depressed valuation range, we believe that your management team and investor relations efforts should be focused on potential long-term holders of the stock such as mutual fund investors and retail investors. Further, we believe your reporting and business transparency has been effective, timely and detailed. NYSE LISTING Further to our comments on the investor relations effort, we urge the management team to devote a significant amount of its corporate strategy efforts to a timely listing on the NYSE. We believe that a transition to a major exchange would expand the stock ownership universe and provide an opportunity to enhance the shareholder base with long-term holders. To that end, we urge the Company to engage a reputable investment bank (or announce that China Security has already engaged one, if appropriate) to advise the Company on a listing on the NYSE. We think that the Company would benefit from a long-term advisory relationship with a reputable investment bank that could assist on further capital raising and counsel on optimal capital structures. We would be happy to further provide investment banking contacts of the Clinton Group who have already expressed interest in developing a long-term advisory relationship. PRIVATIZATION To the extent your stock price continues to fail to reflect a valuation appropriate for the Company's growth prospects, we believe that China Security represents an attractive privatization candidate at a valuation well north of $20.00 per share. We believe that private equity firms are looking to increase exposure in Asia in partnership with companies with strong growth prospects. If after proceeding with all of the measures we have previously outlined and if there is not a significant appreciation in your stock price to levels appropriate for the Company's growth prospects, we would be happy to introduce to you several private equity firms to evaluate a management buyout transaction. We would welcome the opportunity to invest in a private equity transaction with you and a selected partner. I want to reiterate that we commend your business execution to date and are supportive of your management and excited about the growth prospects of the Company and management's ability to implement its business strategy. Please feel free to contact me at your convenience at (212) 377-4224 or my colleague, Joseph De Perio, at (212) 739-1833 to discuss any and all issues. Sincerely, /s/ Conrad Bringsjord Conrad Bringsjord Senior Managing Director cc: Mr. Terence Yap -----END PRIVACY-ENHANCED MESSAGE-----