SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
June 15, 1999
MAC-GRAY CORPORATION
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(Exact name of registrant as specified in charter)
Delaware
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(State or Other Jurisdiction of Incorporation)
1-13495 04-3361982
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(Commission file number) (IRS employer identification number)
22 Water Street, Massachusetts 02141
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(Address of principal executive offices) (Zip code)
(617) 492-4040
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(Registrant's telephone number, including area code)
Item 5. Other Events
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On June 15, 1999 the Board of Directors of Mac-Gray Corporation (the
"Company") adopted a Shareholder Rights Agreement (the "Rights Agreement").
The following description of the terms of the Rights Agreement does not purport
to be complete and is qualified in its entirety by reference to the Rights
Agreement which is attached hereto as an exhibit and is incorporated herein by
reference.
Pursuant to the terms of the Rights Agreement, the Board of Directors
declared a dividend distribution of one Preferred Stock Purchase Right (a
"Right") for each outstanding share of Common Stock of the Company (the "Common
Stock") to stockholders of record on June 17, 1999 (the "Record Date"). In
addition, one Right will automatically attach to each share of Common Stock
issued between the Record Date and the Distribution Date (as hereinafter
defined). Each Right entitles the registered holder thereof to purchase from
the Company a unit consisting of one ten-thousandth of a share (a "Unit") of
Series A Junior Participating Cumulative Preferred Stock, par value $.01 per
share, at a cash exercise price of $80.00 per Unit, subject to adjustment.
Initially, the Rights are not exercisable and are attached to and trade
with all shares of Common Stock outstanding as of, and issued subsequent to, the
Record Date. The Rights will separate from the Common Stock and will become
exercisable upon the earliest of (i) the close of business on the tenth calendar
day following the first public announcement that a person or group of affiliated
or associated persons has acquired beneficial ownership of 15% or more of the
outstanding shares of Common Stock (an "Acquiring Person"), (ii) the close of
business on the tenth business day (or such later day as the Board of Directors
may determine) following the commencement of a tender offer or exchange offer
that could result upon its consummation in a person or group becoming the
beneficial owner of 15% or more of the outstanding shares of Common Stock or
(iii) the determination by the Board of Directors that any person is an
"Adverse Person" (the earliest of such dates being herein referred to as the
"Distribution Date"). In the case of stockholders of the Company who
beneficially owned 15% or more of the outstanding shares of the Company's Common
Stock as of June 17, 1999 (such stockholders are referred to in the Rights
Agreement as "grandfathered persons"), the Rights generally will be distributed
only if any such stockholder acquires or proposes to acquire an additional 3% of
the outstanding shares of the Company's Common Stock. In addition, a
"grandfathered person" generally will become an Acquiring Person only if such
person acquires an additional 3% of the outstanding shares of the Company's
Common Stock.
The Rights are not exercisable until the Distribution Date and will expire
at the close of business on June 15, 2009 (the "Expiration Date"), unless
previously redeemed or exchanged by the Company as described below.
The Rights may be redeemed in whole, but not in part, at a price of $0.01
per Right (payable in cash, Common Stock or other consideration deemed
appropriate by the Board of Directors) by the Board of Directors only until the
earliest of (i) the time at which a person is declared to be an Adverse Person,
(ii) the time at which any person becomes an Acquiring Person,
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or (iii) the expiration date of the Rights Agreement. Immediately upon the
action of the Board of Directors ordering redemption of the Rights, the Rights
will terminate and thereafter the only right of the holders of Rights will be to
receive the redemption price.
The Rights Agreement may be amended by the Board of Directors in its sole
discretion until the earlier to occur of (i) the time at which any person
becomes an Acquiring Person or (ii) the time at which a person is declared to be
an Adverse Person. After such time the Board of Directors may, subject to
certain limitations set forth in the Rights Agreement, amend the Rights
Agreement only to cure any ambiguity, defect or inconsistency, to shorten or
lengthen any time period, or to make changes that do not adversely affect the
interests of Rights holders (excluding the interests of an Acquiring Person, an
Adverse Person or their associates or affiliates). In addition, the Board of
Directors may at any time prior to the earlier to occur of (i) the time at which
any person becomes an Acquiring Person or (ii) the time at which a person is
declared to be an Adverse Person, amend the Rights Agreement to lower the
threshold at which a person becomes an Acquiring Person to not less than the
greater of (i) the sum of .001% and the largest percentage of the outstanding
Common Stock then owned by any person and (ii) 10%.
Until a Right is exercised, the holder will have no rights as a stockholder
of the Company (beyond those as an existing stockholder), including the right to
vote or to receive dividends. While the distribution of the Rights will not be
taxable to stockholders or to the Company, stockholders may, depending upon the
circumstances, recognize taxable income in the event that the Rights become
exercisable for Units, other securities of the Company, other consideration or
for common stock of an acquiring company.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
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Exhibit 3.1 - Certificate of Designations, Preferences and Rights of a
Series of Preferred Stock of Mac-Gray Corporation
classifying and designating the Series A Junior
Participating Cumulative Preferred Stock.
Exhibit 4.1 - Shareholder Rights Agreement, dated as of June 15, 1999,
between Mac-Gray Corporation and State Street Bank and Trust
Company, as Rights Agent.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: June 15, 1999 By: /s/ Stewart G. MacDonald, Jr.
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Name: Stewart G. MacDonald, Jr.
Title: Chairman and C.E.O.
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EXHIBIT INDEX
Exhibit No. Description
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3.1 Certificate of Designations, Preferences and Rights of a Series
of Preferred Stock of Mac-Gray Corporation classifying and
designating the Series A Junior Participating Cumulative
Preferred Stock.
4.1 Shareholder Rights Agreement, dated as of June 15, 1999, between
Mac-Gray Corporation and State Street Bank and Trust Company, as
Rights Agent.
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