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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
 þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For
the quarterly period ended March 31, 2007.
 or
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For
the transition period from      to
 Commission File Number: 333-12799
 Alpha Security Group Corporation
  Delaware
    
    03-0561397(State or Other Jurisdiction of
    
    (I.R.S. EmployerIncorporation or Organization)
    
    Identification No.)
 328 West 77 th Street
New York, New York 10024  (Address of Principal Executive Offices including Zip Code)
 212-877-1588  (Registrants Telephone Number, Including Area Code)
 þ o
  o o þ
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ALPHA SECURITY GROUP CORPORATION INDEX TO FORM 10-Q
 INDEX
 Page No.Part 1.
    
    Financial InformationItem 1.
    
    Financial StatementsCondensed Balance Sheets as of March 31, 2007 (unaudited) and December 31, 2006
    
    
    3Condensed Statement of Operations for the three months ended March 31, 2007 and March 31, 2006,
and for the period from April 20, 2005 (date of inception) to March 31, 2007 (unaudited)
    
    
    4Condensed Statement of Stockholders Equity for the period from April 20, 2005 (date of inception) to
March 31, 2007
    
    
    5Condensed Statement of Cash Flows for the three months ended March 31, 2007 and March 31, 2006,
and from April 20, 2005 (date of inception) to March 31, 2007
    
    
    6Notes to Condensed Financial Statements
    
    
    7Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    13Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    15Item 4.
    
    Controls and Procedures
    
    
    15Part 2.
    
    Other InformationItem 1.
    
    Legal Proceedings
    
    
    16Item 1A.
    
    Risk Factors
    
    
    16Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    16Item 3.
    
    Default Upon Senior Securities
    
    
    16Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    16Item 5.
    
    Other Information
    
    
    17Item 6.
    
    Exhibits
    
    
    17SIGNATURESEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONEX-32.2: CERTIFICATION
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(a corporation in the development stage)
 
 CONDENSED BALANCE SHEET
 March 31, 2007(Unaudited)
    
    
    December 31, 2006ASSETSCurrent AssetsCash
    
    $
    2,087
    
    
    $
    7,119Investment in trust account
    
    
    60,036,134Accrued income receivable
    
    
    9,224Total current assets
    
    
    60,047,445
    
    
    
    7,119Deferred tax
asset
    
    
    19,861
    
    
    
    Deferred offering costs
    
    
    
    
    
    
    495,712Total assets
    
    $
    60,067,306
    
    
    $
    502,831LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIENCY)Current LiabilitiesAccrued offering costs  principally professional fees
    
    $
    
    
    
    $
    325,386Accrued expenses and taxes
    
    
    24,631Deferred underwriting fees
    
    
    1,800,000
    
    
    
    Deferred interest on funds held in trust
    
    
    12,563Deferred legal fees
    
    
    90,000Notes payable  stockholders
    
    
    250,000
    
    
    
    187,802Total liabilities
    
    
    2,177,194
    
    
    
    513,188Common stock, subject to possible redemption,
2,099,400 shares, at redemption value of $9.70 per share
    
    
    20,364,180
    
    
    
    CommitmentsStockholders equity (deficiency)Preferred stock, $.0001 par value, authorized
1,000,000 shares, none issuedCommon stock, $.0001 par value, authorized
30,000,000 shares; issued and outstanding
7,580,000 and 1,580,000 shares at
March 31, 2007 and December 31, 2006
    
    
    758
    
    
    
    158Additional paid-in capital
    
    
    37,548,281
    
    
    
    24,530Deficit accumulated during the development stage
    
    
    (23,107
    )
    
    
    (35,045
    )Total stockholders equity (deficiency)
    
    
    37,525,932
    
    
    
    (10,357
    )Total liabilities and stockholders equity (deficiency)
    
    $
    60,067,306
    
    
    $
    502,831
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(a corporation in the development stage)
 
  For the
    
    
    For the period fromThree months
    
    
    Three months
    
    
    April 20, 2005ended
    
    
    ended
    
    
    (inception) toMarch 31, 2007
    
    
    March 31, 2006
    
    
    March 31, 2007(Unaudited)
    
    
    (Unaudited)
    
    
    (Unaudited)Interest and dividend income
    
    $
    37,660
    
    
    $
    
    
    
    $
    37,660Formation and operating costs
    
    
    25,722
    
    
    
    5,368
    
    
    
    60,767Net income (loss)
    
    $
    11,938
    
    
    $
    (5,368
    )
    
    $
    (23,107
    )Weighted average shares outstanding
    
    
    1,846,667
    
    
    
    1,600,000
    
    
    
    1,627,989Net income (loss) per share
    
    $
    0.01
    
    
    $
    (0.00
    )
    
    $
    (0.01
    )
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(a corporation in the development stage)
 
  For the period from April 20, 2005 (inception) to March 31, 2007Deficitaccumulatedduring the
    
    
    StockholdersCommon stock
    
    
    Additional paid-in
    
    
    development
    
    
    equityShares
    
    
    Amount
    
    
    capital
    
    
    stage
    
    
    (deficiency)Common shares issued
July 18, 2005 at $.0156
    
    
    1,600,000
    
    
    $
    160
    
    
    $
    24,840
    
    
    $
    
    
    
    $
    25,000Net loss2005
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (11,140
    )
    
    
    (11,140
    )Balance  December 31, 2005
    
    
    1,600,000
    
    
    $
    160
    
    
    $
    24,840
    
    
    $
    (11,140
    )
    
    $
    13,860Net loss2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (23,905
    )
    
    
    (23,905
    )Redemption  September 15, 2006
    
    
    (20,000
    )
    
    
    (2
    )
    
    
    (310
    )
    
    
    
    
    
    
    (312
    )Balance  December 31, 2006
    
    
    1,580,000
    
    
    $
    158
    
    
    $
    24,530
    
    
    $
    (35,045
    )
    
    $
    (10,357
    )Proceeds of
private placement 
March 21, 2007
    
    
    
    
    
    
    
    
    
    
    3,200,000
    
    
    
    
    
    
    
    3,200,000Common shares issued
March 28, 2007 @ $10 per share
    
    
    6,000,000
    
    
    
    600
    
    
    
    59,999,400
    
    
    
    
    
    
    
    60,000,000Proceeds subject to possible
redemption of 2,099,400 shares
    
    
    
    
    
    
    
    
    
    
    (20,364,180
    )
    
    
    
    
    
    
    (20,364,180
    )Expenses of the Offering
    
    
    
    
    
    
    
    
    
    
    (5,311,569
    )
    
    
    
    
    
    
    (5,311,569
    )Unaudited:Net income  January 1 to
March 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11,938
    
    
    
    11,938Proceeds of Options Sold
    
    
    
    
    
    
    
    
    
    
    100
    
    
    
    
    
    
    
    100Balance  March 31, 2007
    
    
    7,580,000
    
    
    $
    758
    
    
    $
    37,548,281
    
    
    $
    (23,107
    )
    
    $
    37,525,932
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(a corporation in the development stage)
 
  For the period fromApril 20, 2005 (Dateof Inception) to
    
    
    January 1, 2007 to
    
    
    January 1, 2006March 31, 2007
    
    
    March 31, 2007
    
    
    To March 31, 2006Cash flows from operating activities:Net income (loss)
    
    $
    (23,107
    )
    
    $
    11,938
    
    
    $
    (5,368
    )Adjustments to reconcile net loss to
net cash used in operating activities:(Increase) in investment in Trust
Account
    
    
    (33,303
    )
    
    
    (33,303
    )Increase in accrued income receivable
    
    
    (9,224
    )
    
    
    (9,224
    )Increase in deferred taxes
    
    
    (19,861
    )
    
    
    (19,861
    )Increase in deferred interest on
funds held in trust
    
    
    12,563
    
    
    
    12,563Changes in accounts payable and
accrued expenses
    
    
    24,631
    
    
    
    23,397Net cash used in operating activities
    
    
    (48,301
    )
    
    
    (14,490
    )
    
    
    (5,368
    )Cash flows from investing activitiesPayment to trust account
    
    
    (60,002,831
    )
    
    
    (60,002,831
    )Net cash provided by (used in)
financing
activities
    
    
    (60,002,831
    )
    
    
    (60,002,831
    )Cash flows from financing activities:Payment of expenses of offering
    
    
    (3,421,569
    )
    
    
    (3,250,009
    )Proceeds from sale of common stock
    
    
    25,000Proceeds
from notes payable  stockholder
    
    
    250,000
    
    
    
    250,000Proceeds from initial public offering
    
    
    60,000,000
    
    
    
    60,000,000Proceeds from private placement
    
    
    3,200,000
    
    
    
    3,200,000Proceeds from sale of option
    
    
    100
    
    
    
    100Repayment of notes payable  stockholders
    
    
    
    
    
    
    (187,802
    )Payment of deferred offering costs
    
    
    
    
    
    
    
    
    
    
    (6,055
    )Redemption of stock
    
    
    (312
    )Net cash provided by (used in)
financing
activities
    
    
    60,053,219
    
    
    
    60,012,289
    
    
    
    (6,055
    )Net increase (decrease) in cash
    
    
    2,087
    
    
    
    (5,032
    )
    
    
    (11,423
    )Cash  beginning of period
    
    
    
    
    
    
    7,119
    
    
    
    86,402Cash  end of period
    
    $
    2,087
    
    
    $
    2,087
    
    
    $
    74,979Supplemental schedule of non-cash
financing activities:Accrual of deferred offering costs
    
    $
    1,890,000
    
    
    $
    1,890,000
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1. Organization, Proposed Business Operations and Summary of Significant Accounting Policies
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1. Organization, Proposed Business Operations and Summary of Significant Accounting Policies
(continued)
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1. Organization, Proposed Business Operations and Summary of Significant Accounting Policies
(continued)
  Cash and Cash Equivalents
  Income Taxes
  Share-Based payments
  Recently issued accounting pronouncements
 
   Loss per common share
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1. Organization, Proposed Business Operations and Summary of Significant Accounting Policies
(continued)
  Use of Estimates
  2. Public Offering and Private Placement
    Accounting for Derivative
Financial Instruments Indexed to, and Potentially Settled in, a Companys Own Stock.
  10




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3. Note payable, stockholder
  4. Commitments
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4. Commitments  (continued)
  
    
    the market price of the underlying shares of common stock is lower than
the exercise price;
    
    the holder of the warrants has not confirmed in writing that the
representative solicited the exercise;
    
    the warrants are held in a discretionary account;
    
    the warrants are exercised in an unsolicited transaction; or
    
    the arrangement to pay the commission is not disclosed in the
prospectus provided to warrant holders at the time of exercise
 5. Preferred Stock
  6. Stockholders Equity
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ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Forward Looking Statements
  Overview
  
    
    may significantly reduce the equity interest of our stockholders;
    
    will likely cause a change in control if a substantial number of our shares of
common stock are issued, which may affect, among other things, our ability to use our
net operating loss carry forwards, if any, and may also result in the resignation or
removal of one or more of our present officers and directors; and
    
    may adversely affect prevailing market prices for our common stock.
  
    
    default and foreclosure on our assets if our operating revenues after a
business combination were insufficient to pay our debt obligations;
    
    acceleration of our obligations to repay the indebtedness even if we have made
all principal and interest payments when due if the debt security contained covenants
that require the satisfaction or maintenance of certain financial ratios or reserves
and any such covenants were breached without a waiver or renegotiation of that
covenant;
    
    our immediate payment of all principal and accrued interest, if any, if the
debt securities were payable on demand; and
    
    our inability to obtain additional financing, if necessary, if the debt
securities contained covenants restricting our ability to obtain additional financing
while such securities were outstanding.
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
    
    payment of taxes on trust account interest income;
    
    payment of State of Delaware franchise taxes;
    
    repayment of up to $250,000 of an additional officer loan made prior to the
closing of this offering by Steven M. Wasserman;
    
    our working capital requirements before we complete a business combination and,
if necessary, funding the costs of our potential dissolution and liquidation;
    
    solely if we complete a business combination, interest on the amount of
deferred underwriters compensation payable to the underwriters; and
    
    the balance, if any, to us if we complete a business combination or to our
public stockholders if we do not complete a business combination.
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 ITEM 4. CONTROLS AND PROCEDURES
  15




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PART II- OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A. RISK FACTORS
  
 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
    
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
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ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS
 Exhibit No.
    
    Description31.1
    
    Certification of the Chief Executive Officer (Principal Executive Officer) pursuant to Rule
l3a-14(a) of the Securities Exchange Act, as amended31.2
    
    Certification of the Chief Financial Officer and (Principal Accounting Officer) pursuant to
Rule l3a-14 of the Securities Exchange Act, as amended32.1
    
    Certification of the Chief Executive Officer (Principal Executive Officer) pursuant to 18
U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    
    Certification of the Chief Financial Officer (Principal Financial Officer) pursuant to 18
U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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SIGNATURES
  ALPHA SECURITY GROUP CORPORATIONMay 18, 2007
    By:
    /s/ Steven M. WassermanSteven M. WassermanChief Executive Officer