<PAGE>
OMB APPROVAL
UNITED STATES OMB Number: 3235-0145
SECURITIES AND Expires: October 31, 1997
EXCHANGE COMMISSION Estimated average burden
Washington, D.C. 20549 hours per response....14.90
-----------------------------
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. ________)*
Coinmach Laundry Corporation
- -------------------------------------------------------------------------------
(Name of Issuer)
Class A Common Stock, $.01 par value per share
- -------------------------------------------------------------------------------
(Title of Class of Securities)
19259L101
------------------------------------------------------------
(CUSIP Number)
Ronald S. Brody, Esq., c/o Anderson Kill & Olick, P.C.
1251 Avenue of the Americas, New York, New York 10020 (212) 278-1000
- -------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive Notices and
Communications)
July 23, 1996/**/
------------------------------------------------------------
(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 which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-I(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ ].
NOTE: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are to
be sent.
*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 page.
**If and to the extent the event requiring filing of this statement occurred on
July 23, 1996, this filing is made as a consequence thereof; provided, however,
that the filing of this statement shall not be construed as an admission that a
filing is required with respect to the events described in this statement. See
Item 4 of this statement.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
MCS Capital, Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC, SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
504,391/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 504,391/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
504,391/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.0%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 246,476 shares of Class A Common Stock underlying options
not currently exercisable; includes 61,622 shares of Class A Common Stock
underlying currently exercisable options. MCS Capital, Inc. disclaims
beneficial ownership of all shares beneficially owned by the other parties
to the Voting Agreement, dated July 23, 1996. See Items 4 and 5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Stephen R. Kerrigan
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not applicable
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
0
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 0
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
504,391/1/
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
504,391/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.0%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 246,476 shares of Class A Common Stock underlying options
not currently exercisable; includes 61,622 shares of Class A Common Stock
underlying currently exercisable options. Mr. Kerrigan disclaims beneficial
ownership of all shares beneficially owned by the other parties to the
Voting Agreement, dated July 23, 1996, to which MCS Capital, Inc. is a
party. See Items 4 and 5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
President and Fellows of Harvard College
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
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) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
151,860/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 151,860/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
151,860/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.5%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ President and Fellows of Harvard College disclaim beneficial ownership of
all shares of Class A Common Stock beneficially owned by the other parties
to the Voting Agreement, dated July 23, 1996. See Items 4 and 5./
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Harvard Management Company, Inc.
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
Not Applicable
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Massachusetts
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
0
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 0
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
151,860/1/
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
151,860/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.5%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Harvard Management Company, Inc. disclaims beneficial ownership of all
shares of Class A Common Stock beneficially owned by the other parties to
the Voting Agreement, dated July 23, 1996, to which President and Fellows of
Harvard College is a party. See Items 4 and 5./
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Mitchell Blatt
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF,SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
416,313/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 416,313/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
416,313/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
4.2%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 80,000 shares of Class A Common Stock underlying options
not currently exercisable; includes 20,000 shares of Class A Common Stock
underlying currently exercisable options. Mr. Blatt disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Robert M. Doyle
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF, SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
123,586/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 123,586/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
123,586
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.2%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 57,512 shares of Class A Common Stock underlying options
not currently exercisable; includes 14,378 shares of Class A Common Stock
underlying currently exercisable options. Mr. Doyle disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. Items 4 and 5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Michael E. Stanky
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF,SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
77,580/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 77,580/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
77,580/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.8%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 122,816 shares of Class A Common Stock underlying options
not currently exercisable; includes 30,705 shares of Class A Common Stock
underlying currently exercisable options. Mr. Stanky disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Charles Prato
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF,SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
32,225/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 32,225/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
32,225/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.3%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 9,200 shares of Class A Common Stock underlying options not
currently exercisable; includes 2,302 shares of Class A Common Stock
underlying currently exercisable options. Mr. Prato disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
James N. Chapman
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
24,635/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 24,635/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,635/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.3%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ /Does not include 23,004 shares of Class A Common Stock underlying options
not currently exercisable; includes 5,752 shares of Class A Common Stock
underlying currently exercisable options. Mr. Chapman disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Michael E. Marrus
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
20,223/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 20,223/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
20,223/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.3%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 23,004 shares of Class A Common Stock underlying options
not currently exercisable; includes 5,752 shares of Class A Common Stock
underlying currently exercisable options. Mr. Marrus disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
David Tulkop
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF, SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
20,449/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 20,449/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
20,449/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.2%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 2,000 shares of Class A Common Stock underlying options
not currently exercisable; includes 500 shares of Class A Common Stock
underlying currently exercisable options. Mr. Tulkop disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Russell Harrison
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF,SC
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
12,852/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 12,852/1/
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
0
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
12,852/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.2%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Does not include 11,500 shares of Class A Common Stock underlying options
not currently exercisable; includes 2,878 shares of Class A Common Stock
underlying currently exercisable options. Mr. Harrison disclaims beneficial
ownership of all shares of Class A Common Stock beneficially owned by the
other parties to the Voting Agreement, dated July 23, 1996. See Items 4 and
5.
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
S.A. Spencer
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
0/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 0
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
24,297/1/
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,297/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.2%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Mr. Spencer and Mary M. Spencer jointly own 24,297 shares of Class A Common
Stock. See Items 4 and 5. Mr. Spencer disclaims beneficial ownership of all
shares of Class A Common Stock beneficially owned by the other parties to
the Voting Agreement, dated July 23, 1996
<PAGE>
SCHEDULE 13D
<TABLE>
<CAPTION>
CUSIP NO. 19259L101 Page _______ of _______ Pages
--------- -----------------------------
<S> <C> <C>
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Mary M. Spencer
- ------------------------------------------------------------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [X]
- ------------------------------------------------------------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------------------------------------------------------------
4 SOURCE OF FUNDS
PF
- ------------------------------------------------------------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
Not Required
- ------------------------------------------------------------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U.S. Citizen
- -----------------------------------------------------------------------------------------------------------------------------------
7 SOLE VOTING POWER
0/1/
NUMBER OF
SHARES -------------------------------------------------------------------------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,408,411/1/
EACH -------------------------------------------------------------------------------------------------------------------
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON 0
WITH -------------------------------------------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
24,297/1/
- ----------------------------------------------------------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
24,297/1/
- ----------------------------------------------------------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]
- ----------------------------------------------------------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.2%
- ----------------------------------------------------------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
/1/ Ms. Spencer and S.A. Spencer jointly own 24,297 shares of Class A Common
Stock. Ms. Spencer disclaims beneficial ownership of all shares of Class A
Common Stock beneficially owned by the other parties to the Voting
Agreement, dated July 23, 1996, to which Mr. Spencer is a party. See Items
4 and 5.
<PAGE>
COINMACH LAUNDRY CORPORATION
(CUSIP NO. 19259L101)
ITEM 1. SECURITY AND ISSUER.
This statement relates to the Class A common stock, par value $.01 per
share (the "Common Stock"), of Coinmach Laundry Corporation (the "Issuer"). The
address of the principal executive offices of the Issuer is 55 Lumber Road,
Roslyn, New York 11576.
ITEM 2. IDENTITY AND BACKGROUND.
This statement is being filed jointly by each of the following persons
pursuant to Rule 13d-(1)(f) promulgated by the Securities and Exchange
Commission (the "SEC") under Section 13 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"): (i) MCS Capital, Inc., a Delaware corporation
("MCS"); (ii) Stephen R. Kerrigan (by virtue of his controlling interest in
MCS); (iii) President and Fellows of Harvard College, a Massachusetts charitable
corporation ("Harvard"); (iv) Harvard Management Company, Inc., a Massachusetts
corporation ("Harvard Management") (by virtue of it being the investment manager
of Harvard); (v) Mitchell Blatt; (vi) Robert M. Doyle; (vii) Michael E. Stanky;
(viii) Charles Prato; (ix) David Tulkop; (x) Russell Harrison; (xi) James N.
Chapman; (xii) Michael E. Marrus; (xiii) S.A. Spencer; and (xiv) Mary M.
Spencer.
MCS, Harvard, Harvard Management, and each of Messrs. Kerrigan, Blatt,
Doyle, Stanky, Prato, Tulkop, Harrison, Chapman, Marrus, S.A. Spencer and Mary
M. Spencer are sometimes referred to herein individually as a "Reporting Person"
and collectively as the "Reporting Persons."
Information with respect to each Reporting Person is given solely by
such Reporting Person, and no Reporting Person assumes responsibility for the
accuracy or completeness of information given by another Reporting Person. By
their signatures on this statement, each Reporting Person agrees that this
statement is filed on behalf of such Reporting Person.
The Reporting Persons may be deemed to constitute a "group" for
purposes of Section 13(d)(3) of the Exchange Act. The Reporting Persons and the
other parties to the Voting Agreement (as defined in Item 4) may also be deemed
to constitute a "group" for purposes of Section 13(d)(3) of the Exchange Act.
The Reporting Persons expressly deny the existence of any agreement to act as a
group other than as described in this statement.
The principal business of MCS is to make investments in common stock
and other interests in business organizations, domestic or foreign, with the
principal objective of appreciation of capital invested. The principal business
address of MCS is c/o the Issuer, 55 Lumber Road, Roslyn, New York 11576.
Stephen R. Kerrigan is the President and controlling stockholder of MCS. Mr.
Kerrigan's principal occupation is Chairman and Chief Executive Officer of the
Issuer. Mr. Kerrigan is a United States citizen whose business address is c/o
the Issuer, 55 Lumber Road, Roslyn, New York 11576.
Harvard is a Massachusetts charitable corporation whose investments are
managed by Harvard Management. Certain information required by Item 2
concerning the fellows, executive officers and controlling persons of Harvard
is set forth on Schedule A attached to this statement.
----------
The principal business of Harvard is education and the principal business of
Harvard Management is to make investments in common stock and other interests in
business organizations, domestic or foreign, with the principal objective of
appreciation of capital invested. The principal business address of Harvard and
Harvard Management is 600 Atlantic Avenue, Boston, Massachusetts 02210.
Mr. Blatt's principal occupation is President and Chief Operating
Officer of the Issuer. Mr. Doyle's principal occupation is Chief Financial
Officer, Senior Vice President, Treasurer and Secretary of the Issuer.
<PAGE>
Mr. Stanky's principal occupation is Senior Vice President of the Issuer. Mr.
Prato's principal occupation is General Manager of Super Laundry Equipment Corp.
Mr. Tulkop's principal occupation is Vice President of Operations of Coinmach
Corporation, a wholly-owned subsidiary of the Issuer. Mr. Harrison's principal
occupation is Director of Security of Coinmach Corporation, a wholly-owned
subsidiary of the Issuer. Each of Messrs. Blatt, Doyle, Stanky, Prato, Tulkop
and Harrison is a United States citizen whose business address is c/o the
Issuer, 55 Lumber Road, Roslyn, New York 11576.
Mr. Chapman's principal occupation is as a financial advisor and
independent consultant. Mr. Chapman is a United States citizen whose business
address is c/o the Issuer, 55 Lumber Road, Roslyn, New York 11576.
Mr. Marrus' principal occupation is as a principal of Fieldstone FPCG
Services, L.P. ("Fieldstone"). Mr. Marrus is a United States citizen whose
business address is c/o Fieldstone, 1177 Avenue of the Americas, New York, New
York 10036.
Mr. Spencer's principal occupation is as a financial advisor and
independent consultant. Mr. Spencer is a United States citizen whose business
address is c/o Holding Capital Group, Inc., 104 Crandon Blvd., Rm. 419, Key
Biscayne, Florida 33149. Ms. Spencer is a United States citizen whose principal
occupation is an interior designer.
During the past five years, none of the Reporting Persons has been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and has not, as a result of such
proceeding, been 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.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Purchases of Capital Stock of Coinmach Corporation
On January 31, 1995, Coinmach Corporation, a wholly-owned subsidiary of
the Issuer ("Coinmach"), the successor in interest to The Coinmach Corporation,
a Delaware corporation ("TCC"), entered into the following agreements with
respect to the purchase of its capital stock, each of which agreements was
amended by that certain Omnibus Agreement, dated as of November 30, 1995, among
the Issuer, Solon Automated Services, Inc. ("Solon"), TCC and certain other
signatories thereto (the "Omnibus Agreement"):
(a) Investor Purchase Agreements with Harvard, MCS Capital Management,
Inc. ("MCS Management") and Messrs. Chapman, Marrus, and Blatt, pursuant to
which such investors purchased 2,417; 268; 300; 231 and 400 shares of Class A
Common Stock of TCC, respectively, for cash consideration of approximately
$349,973, $38,805, $43,439, $33,448, and $57,919, respectively;
(b) Executive Stock Agreements with each of Messrs. Prato, Harrison and
Tulkop pursuant to which such persons purchased 750; 250 and 500 shares of Class
B Common Stock of TCC, respectively, for consideration of approximately $21,875
($17,500 of which was in the form of a promissory note in favor of TCC), $7,292
($5,833 of which was in the form of a promissory note in favor of TCC) and
$14,583 ($11,666 of which was in the form of a promissory note in favor of TCC),
respectively; and
(c) Senior Management Agreements with MCS and each of Messrs. Blatt and
Doyle, pursuant to which such parties purchased 6,000; 1,000 and 6,000 shares of
Class B Common Stock of TCC, respectively, for consideration of approximately
$175,000
<PAGE>
($35,000 of which was cash consideration and $140,000 of which was in the form
of a promissory note in favor of TCC), $29,167 ($5,834 of which was cash
consideration and $23,333 of which was in the form of a promissory note in favor
of TCC), and $175,000 ($35,000 of which was cash consideration and $140,000 of
which was in the form of a promissory note in favor of TCC), respectively.
Purchases of Capital Stock of the Issuer
On July 26, 1995, the Issuer (formerly known as SAS Acquisitions Inc.)
entered into the following agreements, each of which was amended by the Omnibus
Agreement, with respect to the purchase of its capital stock:
(a) an Investor Purchase Agreement among certain investors, including
Harvard and Messrs. Chapman, Marrus, Blatt, MCS and Stanky pursuant to which
such parties purchased 2,405; 300; 228; 398; and 425 shares of Class A Common
Stock of the Issuer, respectively, for cash consideration of approximately
$183,912, $22,941, $17,435, $30,435 and $32,500, respectively; and
(b) an Executive Stock Agreement among certain parties, including MCS
and Messrs. Blatt, Doyle and Stanky, pursuant to which such parties purchased
4,000; 4,000; 2,000 and 1,500 shares of Class B Common Stock of the Issuer,
respectively, for consideration of approximately $61,611 ($9,241 of which was
cash consideration and $52,369 of which was in the form of a promissory note in
favor of the Issuer), $61,611 ($9,242 of which was cash consideration and
$52,370 of which was in the form of a promissory note in favor of the Issuer),
$30,806 ($4,621 of which was cash consideration and $26,185 of which was in the
form of a promissory note in favor of the Issuer), and $23,104 ($3,466 of which
was cash consideration and $19,639 of which was in the form of a promissory
notes in favor of the Issuer), respectively.
On May 10, 1996, the Issuer entered into the following agreements with
respect to the purchase of its capital stock:
(a) Stock Subscription Agreements with each of Messrs. Blatt, Doyle and
Kerrigan pursuant to which such persons purchased 1,415; 599 and 1,415 shares of
Class B Common Stock of the Company respectively, for consideration in the form
of promissory notes in favor of the Issuer of approximately $21,795, $9,226 and
$21,795, respectively.
Copies of each of the agreements described above in this Item 3 were
filed with the SEC as exhibits to Coinmach's Registration Statement on Form S-1
(No. 333-00620) ("Coinmach's Registration Statement") and/or the Issuer's
Registration Statement on Form S-1 (No. 333-03587) ("Issuer's Registration
Statement") and are incorporated herein by reference.
Subsequent Events
On November 30, 1995, in connection with the merger of TCC with and into
Coinmach, the shares of capital stock of TCC owned by each of the TCC
stockholders, including certain of the Reporting Persons, were exchanged for
shares of capital stock of the Issuer, in each case, in accordance with the
terms and conditions of an Agreement and Plan of Merger, dated November 30,
1995, among TCC, Solon and SAS (the "Merger Agreement"). A copy of the Merger
Agreement was filed by Coinmach with the SEC as Exhibit 2.1 to Coinmach's
Registration Statement and is incorporated herein by reference.
On July 10, 1996, prior to the initial public offering of shares of
Common Stock of the Issuer (the "Initial Public Offering"), MCS, Mr. Doyle, S.A.
Spencer and Mary M. Spencer acquired from MCS Management, 737.9679, 316.2720 and
1,054.2399 shares of common stock of the Issuer, respectively, in private
transactions.
On July 17, 1996, in connection with the Initial Public Offering, all
shares of capital stock of the Issuer were reclassified into shares of Common
Stock, shares of Class B Common Stock of the Issuer and shares of Series A
Preferred Stock of the Issuer (the "Preferred Stock") in accordance with the
terms and provisions of a Reclassification Agreement, dated July 17, 1996, among
the Issuer and the holders of its
<PAGE>
capital stock (the "Reclassification Agreement"). A copy of the Reclassification
Agreement was filed by the Issuer with the SEC as Exhibit 10.45 to the Issuer's
Report on Form 10-Q for the quarter ended June 28, 1996 (File No. 1-11907) (the
"Issuer's June 10") and is incorporated herein by reference.
On July 23, 1996, pursuant to the terms of the Preferred Stock, 30.8;
5.2; 3.8 and 2.9 shares of Preferred Stock owned by each of Harvard, Mr. and Ms.
Spencer and Messrs. Chapman and Marrus, respectively, were redeemed by the
Issuer for approximately $592,244, $99,989, $73,069 and $55,763, respectively.
The summaries of the agreements referred to in this Item 3 and elsewhere
in this statement are not intended to be complete and are qualified in their
entirety by reference to such agreements incorporated herein by reference.
ITEM 4. PURPOSE OF TRANSACTION.
The table in Item 5 of this statement sets forth the number of shares of
Common Stock held by each Reporting Person, each of whom owns such shares for
investment purposes. Depending on market conditions and other factors
(including securities laws and other legal restrictions governing any proposed
transactions, evaluation of the Issuer's businesses and prospects, availability
of funds, alternative uses of funds and general economic conditions), each
Reporting Person may from time to time acquire additional securities of the
Issuer or dispose of all or a portion of its investment of securities in the
Issuer.
Prior to the effectiveness of the Issuer's registration statement on
Form 8-A (File No. 1-11907) with respect to the Common Stock, the terms of a
voting agreement (the "Voting Agreement") by and among MCS, Harvard, Messrs.
Blatt, Doyle, Stanky, Prato, Chapman, Marrus, Tulkop, Harrison and Spencer
(collectively, the "Voting Stockholders"), the Issuer and Golder, Thoma,
Cressey, Rauner Fund IV, L.P. (the "Fund") were established, and the parties
thereto agreed to execute the Voting Agreement substantially concurrently with
the closing of the Initial Public Offering. On July 23, 1996, the Voting
Stockholders and the Fund executed the Voting Agreement, a copy of which was
filed by the Issuer with the SEC as Exhibit 10.55 to the Issuer's June 10-Q and
is incorporated herein by reference. Heller Financial, Inc. ("Heller"), which
holds 240,324 shares of the Issuer's non-voting Class B common stock, par value
$.01 per share (the "Non-voting Common Stock"), and Jackson National Life
Insurance Company ("Jackson National"), which holds 240,324 shares of Non-voting
Common Stock, have agreed to become parties to the Voting Agreement upon any
conversion of Non-voting Common Stock into Common Stock.
The Voting Agreement provides that each Voting Stockholder and the Fund
will vote its shares of Common Stock and take all other necessary or desirable
actions so that the Board of Directors of the Issuer will initially consist of
five members, (i) two of whom will be designated by the Fund, (ii) two of whom
will be members of the Issuer's management or employees or officers of the
Issuer, in each case designated by the holders of a majority of the Common Stock
held by the Issuer's executive officers, and (iii) one of whom will be an
individual designated by the Fund and reasonably acceptable to Stephen R.
Kerrigan. Additionally, the Voting Agreement provides that the size of the Board
of Directors may be increased by up to two members who will be independent
directors. The independent directors will be designated by the mutual agreement
of the Fund and Mr. Kerrigan.
In the event the size of the Board of Directors is increased above seven
members or decreased below five members, the additional or remaining
directorships, if any, will be apportioned evenly between (i) directors
designated by the Fund, and (ii) directors designated by the holders of a
majority of Common Stock held by the Issuer's executive officers. Whenever the
additional or remaining directorships cannot be apportioned evenly, the
remaining directorship will be an outside director designated by the Fund and
Mr. Kerrigan.
The Voting Agreement will terminate at such time as the Fund holds in
the aggregate less than 20% of all issued and outstanding shares of Common
Stock. Shares of Common Stock held by the Reporting
<PAGE>
Persons and the Fund will cease to be subject to the Voting Agreement when such
shares are either (i) registered and sold under the Securities Act of 1933, as
amended (the "Securities Act"), or (ii) sold to the public through a broker,
dealer or market maker pursuant to the provisions of Rule 144 or Rule 144A
promulgated under the Securities Act.
On September 17, 1996, the size of the Board of Directors was increased
to seven members, and the Board of Directors appointed Dr. Arthur B. Laffer and
Mr. Stephen G. Cerri as independent directors to fill the newly created
directorships.
Except as described in this statement, none of the Reporting Persons
and, to the best knowledge of the Reporting Persons, none of the persons named
in Schedule A to this statement, presently has any plans or proposals which
relate to or would result in any of the transactions described in paragraphs (a)
through (j) of Item 4 of Schedule 13D under the Exchange Act.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) and (b)
Each of the Voting Stockholders beneficially owns the number and
percentage of shares of Common Stock set forth opposite each of their names in
this Item 5 below. Other than Mr. Spencer, each Voting Stockholder has the sole
power to vote and the sole power to dispose of or direct the disposition of the
number of shares of Common Stock held by them. By virtue of the relationship
between MCS and Mr. Kerrigan described in Item 2, Mr. Kerrigan may be deemed to
possess indirect beneficial ownership of and share the power to vote and
indirectly share the power to dispose of or direct the disposition of the shares
of Common Stock beneficially owned by MCS. By virtue of the relationship between
Harvard and Harvard Management described in Item 2, Harvard Management may be
deemed to possess indirect beneficial ownership of and share the power to vote
and indirectly share the power to dispose of or direct the disposition of the
shares of Common Stock beneficially owned by Harvard. Mr. Spencer and Ms.
Spencer own their shares as joint tenants with right of survivorship and share
the power to vote and the power to dispose of or direct the disposition of the
shares of Common Stock held by them.
The Reporting Persons and the Fund may also be deemed to be a
"group" for purposes of Section 13(d)(3) of the Exchange Act as a result of the
Voting Agreement described in Item 4, and, based on the information contained in
the Issuer's Registration Statement, may therefore be deemed to be the indirect
beneficial owners of and to share the power to vote or direct the vote of
4,556,114 additional shares of Common Stock that are subject to the terms of the
Voting Agreement. If the Reporting Persons were deemed to be the beneficial
owners of such additional shares of Common Stock, then the Reporting Persons
would be deemed to be the beneficial owners of an aggregate of 5,964,525 shares
or approximately 59% of the issued and outstanding Common Stock, assuming there
are 10,148,167 shares of Common Stock outstanding, including 143,889 shares of
Common Stock subject to currently exercisable options held by the Reporting
Persons. The foregoing information does not include the Non-voting Common Stock
held by Heller and Jackson National. Each Reporting Person disclaims beneficial
ownership of all shares of Common Stock held by the other parties to the Voting
Agreement.
Number Percentage
Name of Shares of Class
- ---- --------- ----------
MCS Capital, Inc. 504,391/1,2/ 5.0%
Stephen R. Kerrigan/3/
President and Fellows of Harvard College 151,860/4/ 1.5%
Harvard Management Company, Inc./5/
Mitchell Blatt 416,313/6/ 4.2%
Robert M. Doyle 123,586/7/ 1.2%
<PAGE>
Number Percentage
Name of Shares of Class
- ----- ---------- ----------
Michael E. Stanky 77,580/8/ 0.8%
Charles Prato 32,225/9/ 0.3%
James N. Chapman 24,635/10/ 0.3%
Michael E. Marrus 20,223/11/ 0.3%
David Tulkop 20,449/12/ 0.2%
Russell Harrison 12,852/13/ 0.2%
S.A. Spencer and Mary M. Spencer, as 24,297/14/ 0.2%
joint tenants
_____________ _________
Total 1,408,411/15/ 13.9%/16/
1. MCS has sole voting and dispositive power with respect to the shares of
Common Stock owned by it. Stephen R. Kerrigan by virtue of being the
President and controlling stockholder of MCS, may be deemed to share voting
and dispositive power with respect to the shares of Common Stock held by
MCS. MCS and Mr. Kerrigan disclaim beneficial ownership of all shares
beneficially owned by all other Reporting Persons and the Fund. The filing
of this statement by Mr. Kerrigan shall not be construed as an admission
that Mr. Kerrigan is, for the purpose of Section 13(d) or 13(g) of the
Exchange Act, the beneficial owner of any securities covered by this
statement.
2. Includes 61,622 shares of Common Stock underlying currently exercisable
options; does not include 246,476 shares of Common Stock underlying options
not currently exercisable.
3. Mr. Kerrigan disclaims beneficial ownership of all shares of Common Stock
held by MCS Capital, Inc.
4. Harvard has sole voting and dispositive power with respect to the shares of
Common Stock owned by it. Harvard Management, in its capacity as investment
manager of Harvard, may be deemed to share voting and dispositive power
with respect to the shares of Common Stock it manages on behalf of Harvard.
Harvard and Harvard Management disclaim beneficial ownership of all shares
beneficially owned by all other Reporting Persons and the Fund. The filing
of this statement by Harvard Management shall not be construed as an
admission that Harvard Management is, for the purpose of Section 13(d) or
13(g) of the Exchange Act, the beneficial owner of any securities covered
by this statement.
5. Harvard Management disclaims beneficial ownership of all shares of Common
Stock held by Harvard.
6. Includes 20,000 shares of Common Stock underlying currently exercisable
options; does not include 80,000 shares of Common Stock underlying options
not currently exercisable. Mr. Blatt disclaims beneficial ownership of all
shares beneficially owned by all other Reporting Persons and the Fund.
7. Includes 14,378 shares of Common Stock underlying currently exercisable
options; does not include 57,512 shares of Common Stock underlying options
not currently exercisable. Mr. Doyle disclaims beneficial ownership of all
shares beneficially owned by all other Reporting Persons and the Fund.
<PAGE>
8. Includes 30,705 shares of Common Stock underlying currently
exercisable options; does not include 122,816 shares of Common Stock
underlying options not currently exercisable. Mr. Stanky disclaims
beneficial ownership of all shares beneficially owned by all other
Reporting Persons and the Fund.
9. Includes 2,302 shares of Common Stock underlying currently
exercisable options; does not include 9,200 shares of Common Stock
underlying options not currently exercisable. Mr. Prato disclaims
beneficial ownership of all shares beneficially owned by all other
Reporting Persons and the Fund.
10. Includes 5,752 shares of Common Stock underlying currently
exercisable options; does not include 23,004 shares of Common Stock
underlying options not currently exercisable. Mr. Chapman disclaims
beneficial ownership of all shares beneficially owned by all other
Reporting Persons and the Fund.
11. Includes 5,752 shares of Common Stock underlying currently
exercisable options; does not include 23,004 shares of Common Stock
underlying options not currently exercisable. Mr. Marrus disclaims
beneficial ownership of all shares beneficially owned by all other
Reporting Persons and the Fund.
12. Includes 500 shares of Common Stock underlying currently exercisable
options; does not include 2,000 shares of Common Stock underlying
options not currently exercisable. Mr. Tulkop disclaims beneficial
ownership of all shares beneficially owned by all other Reporting
Persons and the Fund.
13. Includes 2,878 shares of Common Stock underlying currently
exercisable options; does not include 11,500 shares of Common Stock
underlying options not currently exercisable. Mr. Harrison
disclaims beneficial ownership of all shares beneficially owned by
all other Reporting Persons and the Fund.
14. Mr. Spencer and Ms. Spencer own the shares as joint tenants with
right of survivorship, and have shared power to direct the vote and
disposition of such shares. Mr. Spencer and Ms. Spencer disclaim
beneficial ownership of all shares beneficially owned by all other
Reporting Persons and the Fund.
15. Includes 143,889 shares of Common Stock underlying currently
exercisable options.
16. Assumes there are 10,148,167 shares of Common Stock outstanding,
including 143,889 shares of Common Stock subject to currently
exercisable options held by certain of the Reporting Persons.
(c) Except as reported herein, none of the Reporting Persons
and, to the best knowledge of the Reporting Persons, none of the persons named
on Schedule A to this statement, has consummated any transactions in the Common
----------
Stock during the past sixty days.
(d) No person other than the Reporting Persons has the right to
receive or the power to direct the receipt of dividends from, or the proceeds
from the sale of, the Common Stock reported as being beneficially owned by such
Reporting Persons.
(e) Not applicable.
<PAGE>
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
The Issuer, MCS, Harvard, Messrs. Blatt, Doyle, Stanky, Chapman,
Harrison and Marrus and the Fund, among others, are parties to a Registration
Agreement, dated as of July 26, 1995, as amended by the Omnibus Agreement (the
"Registration Rights Agreement"). A copy of the Registration Rights Agreement
was filed by the Issuer with the SEC as an exhibit to the Issuer's Registration
Statement and is incorporated herein by reference. The Registration Rights
Agreement provides that, among other things, if the Issuer proposes to register
any of its Common Stock under the Securities Act, whether for its own account or
otherwise, the holders of Registrable Securities (as hereinafter defined) are
entitled to notice of such registration and, subject to, among other things,
certain provisions regarding the priority among holders of securities with
respect to the number of shares to be registered, all the parties to the
Registration Rights Agreement (other than the Issuer) are entitled to include
the securities of the Issuer owned by them ("Registrable Securities") in such
registration. The Issuer is responsible for all registration expenses in
connection with all such registrations. The Registration Rights Agreement also
provides for customary indemnification by the Issuer of the holders of the
Registrable Securities.
The Fund, Coinmach (as successor-in-interest to TCC) and each of (i)
Mr. Kerrigan and MCS, (ii) Mr. Blatt and (iii) Mr. Doyle are parties to Senior
Management Agreements, dated as of January 31, 1995, as amended by the Omnibus
Agreement (each, a "TCC Senior Management Agreement"), and the Fund, Coinmach
(as successor-in-interest to TCC) and each of Messrs. Prato, Harrison and Tulkop
are parties to Executive Stock Agreements, dated as of January 31, 1995, as
amended by the Omnibus Agreement (each, a "TCC Executive Stock Agreement").
Copies of the TCC Senior Management Agreements have been filed by Coinmach with
the SEC as exhibits to Coinmach's Registration Statement and are incorporated
herein by reference, and copies of the TCC Executive Stock Agreements are filed
as exhibits to this statement and are incorporated herein by reference. MCS and
Messrs. Kerrigan, Blatt, Doyle, Prato, Harrison and Tulkop are hereinafter
sometimes referred to as the "TCC Executives," and the TCC Senior Management
Agreements and the TCC Executive Stock Agreements are hereinafter sometimes
referred to as the "TCC Executive Stock Purchase Agreements." The TCC Executive
Stock Purchase Agreements provide that (i) if the TCC Executive breaches certain
provisions contained in the agreement or the TCC Executive's employment with the
Issuer is terminated for certain reasons, the shares purchased by the TCC
Executive pursuant to such agreement (other than shares sold by the TCC
Executive pursuant to an underwritten public offering registered under the
Securities Act or pursuant to Rule 144 or 144A, collectively, "Public Sales")
are subject to purchase by the Issuer first, certain other members of management
of the Issuer second, and by the Fund third, at a price equal to the lower of
the original purchase price and the then fair market value of such shares;
provided, however, that if the TCC Executive's employment is terminated without
cause, the shares subject to such agreement may be purchased by such persons or
entities only at fair market value, (ii) prior to the sale (other than a Public
Sale) of the shares purchased thereunder, the Issuer first, certain other
members of management of the Issuer second, and the Fund third, shall have
rights of first refusal with respect to such shares, and (iii) upon any sale
(other than a Public Sale) of the shares purchased thereunder, the Fund shall
have the right to participate in such sale pro rata based on the number of
shares owned by the Fund and the TCC Executive. Approximately 239,383; 239,383;
39,897; 29,923; 9,974 and 19,949 shares of Common Stock owned by MCS, Mr. Blatt,
Mr. Doyle, Prato, Harrison and Tulkop, respectively, are subject to the terms of
the TCC Executive Stock Purchase Agreements.
The Fund, Coinmach (as successor-in-interest to TCC) and each of (i)
Heller, (ii) Jackson National, (iii) Jackson National (as successor-in-interest
to Jackson National Life Insurance Company of Michigan ("Jackson Michigan")),
(iv) Harvard, (v) Mr. Chapman, (vi) Mr. Marrus, (vii) Mr. Kerrigan and MCS,
(viii) Mr. Kerrigan and MCS Capital Management, Inc. ("MCS Management") and (ix)
Mr. Blatt (each, a "TCC Investor"), are parties to Investor Purchase Agreements,
dated as of January 31, 1995, as amended by the Omnibus Agreement (each, a "TCC
Investor Purchase Agreement"). Copies of the TCC Investor Purchase Agreements
have been filed with the SEC as exhibits to the Issuer's Registration Statement
or as exhibits to this statement and, in each case, are incorporated herein by
reference. The TCC Investor Purchase Agreements provide that (i) prior to the
sale (other than a Public Sale) of the shares purchased thereunder, the
<PAGE>
Issuer first and the Fund second, shall have rights of first refusal with
respect to such shares, and (ii), with respect to the Investor Purchase
Agreements with Harvard, Mr. Chapman, Mr. Marrus, Mr. Kerrigan and MCS, Mr.
Kerrigan and MCS Management and Mr. Blatt, upon the sale (other than a Public
Sale) of the shares purchased thereunder, the Fund shall have the right to
participate in such sale pro rata based on the number of shares owned by the
Fund and the TCC Investor. Approximately 152,607; 137,366 and 15,241 shares of
Non-voting Common Stock and 96,431; 11,969; 9,216; 10,692; 48,595 and 15,959
shares of Common Stock are subject to the TCC Investor Purchase Agreements with
Heller, Jackson National, Jackson National (as successor-in-interest to Jackson
Michigan), Harvard, Mr. Chapman, Mr. Marrus, Mr. Kerrigan and MCS, Mr. Kerrigan
and MCS Management, and Mr. Blatt, respectively.
The Fund, the Issuer, MCS, Mr. Blatt, Mr. Doyle and Mr. Stanky are
parties to an Executive Stock Agreement, dated as of July 26, 1996, as amended
by the Omnibus Agreement (the "SAS Executive Stock Agreement"). A copy of the
SAS Executive Stock Agreement has been filed by the Issuer with the SEC as an
exhibit to the Issuer's Registration Statement and is incorporated herein by
reference. Messrs. Blatt, Doyle, Stanky and, with respect to MCS, Kerrigan are
hereinafter sometimes referred to as the "SAS Executives." The SAS Executive
Stock Agreement provides that (i) if the SAS Executive breaches certain
provisions contained in the agreement or the SAS Executive's employment with the
Issuer is terminated for certain reasons, the shares purchased by the SAS
Executive pursuant to such agreement (other than shares sold by the SAS
Executive pursuant to a Public Sale) are subject to purchase by the Issuer
first, certain other members of management of the Issuer second and by the Fund
third at a price equal to the lower of the original purchase price and the then
fair market value of such shares, provided, however, that if the SAS Executive's
employment is terminated without cause, the shares subject to such agreement may
be purchased only at fair market value, (ii) prior to the sale (other than
pursuant to a Public Sale) of the shares purchased thereunder, the Issuer first,
certain other members of management of the Issuer second and the Fund third,
shall have rights of first refusal with respect to such shares, and (iii) upon
the sale (other than pursuant to Public Sale) of the shares purchased
thereunder, the Fund shall have the right to participate in such sale pro rata
based on the number of shares owned by the Fund and the SAS Executive.
Approximately 92,189; 92,189; 46,095 and 34,571 shares of Common Stock are
subject to the terms of the SAS Executive Stock Agreement with MCS, Mr. Blatt,
Mr. Doyle and Mr. Stanky, respectively.
The Fund, the Issuer, Heller, Jackson National, Jackson National (as
successor-in-interest to Jackson Michigan), Harvard, Mr. Chapman, Mr. Marrus,
MCS, Mr. Blatt, and Mr. Stanky are parties to an Investor Purchase Agreement,
dated as of July 26, 1996, as amended by the Omnibus Agreement (the "SAS
Investor Purchase Agreement"). A copy of the SAS Investor Purchase Agreement
has been filed by the Issuer with the SEC as an exhibit to the Issuer's
Registration Statement and is incorporated herein by reference. Heller, Jackson
National, Jackson Michigan, Harvard, Mr. Chapman, Mr. Marrus, MCS, Mr. Blatt,
and Mr. Stanky are hereinafter sometimes referred to as the "SAS Investors."
The SAS Investor Purchase Agreement provides that (i) prior to the sale (other
than pursuant to a Public Sale) of the shares purchased thereunder, the Issuer
first and the Fund second, shall have rights of first refusal with respect to
such shares, and (ii) upon the sale (other than pursuant to a Public Sale) of
the shares purchased thereunder, the Fund shall have the right to participate in
such sale pro rata based on the number of shares owned. Approximately 87,718;
78,937 and 8,781 shares of Nonvoting Common Stock and, 55,429; 6,914; 5,255;
34,087; 9,173 and 9,795 shares of Common Stock are subject to the terms of the
SAS Investor Purchase Agreement with Heller, Jackson National, Jackson National
(as successor-in-interest to Jackson Michigan), Harvard, Mr. Chapman, Mr.
Marrus, MCS, Mr. Blatt and Mr. Stanky, respectively.
In connection with the Initial Public Offering, each of MCS and
Messrs. Chapman, Doyle, Stanky, Prato, Marrus and Harrison (each, an "Optionee")
were granted non-qualified stock options by the Issuer to acquire 306,508;
28,607; 71,519; 102,987; 11,443; 28,607 and 14,304 shares of Common Stock,
respectively, subject to the terms and conditions of Option Agreements, dated
July 23, 1996, between the Issuer and each Optionee. Copies of each Option
Agreement are attached as exhibits to this statement and are incorporated herein
by reference. On August 8, 1996, the Board of Directors of the Issuer granted
non-qualified stock options (the "Plan Options") under the Issuer's Second
Amended and Restated 1996 Employee Stock Option Plan (the "Plan") to purchase
100,000; 50,000 and 2,500 shares of Common Stock to Messrs.
<PAGE>
Blatt, Stanky and Tulkop, respectively, at an exercise price equal to the fair
market value per share of Common Stock on the date of grant ($14.00 per share).
Twenty percent (20%) of the shares of Common Stock underlying the foregoing
options vested on the date of grant, and the remainder of the shares of Common
Stock underlying such Plan Options vest in four equal annual installments
commencing on the first anniversary of the date of grant. A copy of the Plan is
filed as an exhibit to this statement and is incorporated herein by reference.
On September 17, 1996, the Board of Directors approved the grant of
additional non-qualified stock options to each of MCS and Messrs. Chapman,
Doyle, Stanky, Prato, Marrus and Harrison to acquire 1,590, 149, 371, 534, 59,
149 and 74 shares of Common Stock, respectively, subject to the terms and
conditions of the Option Agreements, as amended by the Omnibus Amendment to
Option Agreements, dated as of September 17, 1996. A copy of the Omnibus
Amendment to Option Agreements is attached as an exhibit to this statement and
is incorporated herein by reference.
Except as set forth in this statement, to the best knowledge of the
Reporting Persons, no contracts, arrangements, understandings or relationships
(legal or otherwise) exist among the persons named in Item 2 or among such
persons and any other person with respect to any securities of the Issuer. The
Voting Stockholders have entered into the Voting Agreement, dated July 23, 1996,
as described in Item 4 above. A copy of the Voting Agreement is attached as an
exhibit to this statement and is incorporated herein by reference.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
Exhibit 1 Joint Filing Agreement among the Reporting Persons
Exhibit 2 Voting Agreement, dated July 23, 1996, among the Reporting
Persons and the Issuer (incorporated by reference from
exhibit number 10.55 to Issuer's Form 10-Q for the quarterly
period ended June 28, 1996, file number 1-11907)
Exhibit 3 Option Agreement, dated July 23, 1996, between the Issuer
and MCS Capital, Inc. (incorporated by reference from
exhibit number 10.46 to Issuer's Form 10-Q for the quarterly
period ended June 28, 1996, file number 1-11907)
Exhibit 4 Option Agreement, dated July 23, 1996, between the Issuer
and James N. Chapman (incorporated by reference from exhibit
number 10.48 to Issuer's Form 10-Q for the quarterly period
ended June 28, 1996, file number 1-11907)
Exhibit 5 Option Agreement, dated July 23, 1996, between the Issuer
and Robert M. Doyle (incorporated by reference from exhibit
number 10.49 to Issuer's Form 10-Q for the quarterly period
ended June 28, 1996, file number 1-11907)
Exhibit 6 Option Agreement, dated July 23, 1996, between the Issuer
and Michael E. Stanky (incorporated by reference from
exhibit number 10.50 to Issuer's Form 10-Q for the quarterly
period ended June 28, 1996, file number 1-11907)
Exhibit 7 Option Agreement, dated July 23, 1996, between the Issuer
and Charles Prato
Exhibit 8 Option Agreement, dated July 23, 1996, between the Issuer
and Michael E. Marrus
Exhibit 9 Option Agreement, dated July 23, 1996, between the Issuer
and Russell Harrison
Exhibit 10 Agreement and Plan of Merger, dated November 30, 1995, of
TCC, Solon Automated Services, Inc. ("Solon") and SAS
Acquisitions Inc. ("SAS") (incorporated by reference
<PAGE>
from exhibit number 2.1 to Coinmach's Registration Statement
on Form S-1, file number 333-00620)
Exhibit 11 Equity Purchase Agreement, dated as of January 31, 1995, by
and between TCC and the Fund, subsequently amended by the
Omnibus Agreement (incorporated by reference from exhibit
number 10.2 to Coinmach's Registration Statement on Form S-
1, file number 333-00620)
Exhibit 12 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund and Harvard, subsequently
amended by the Omnibus Agreement (incorporated by reference
from exhibit number 10.3 to Coinmach's Registration
Statement on Form S-1, file number 333-00620)
Exhibit 13 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, MCS Capital Management, Inc.
and Stephen R. Kerrigan, subsequently amended by the Omnibus
Agreement (incorporated by reference from exhibit number
10.4 to Coinmach's Registration Statement on Form S-1, file
number 333-00620)
Exhibit 14 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, and James N. Chapman,
subsequently amended by the Omnibus Agreement
Exhibit 15 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, and Michael E. Marrus,
subsequently amended by the Omnibus Agreement
Exhibit 16 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, MCS and Stephen R. Kerrigan,
subsequently amended by the Omnibus Agreement
Exhibit 17 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, and Mitchell Blatt,
subsequently amended by the Omnibus Agreement
Exhibit 18 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, and Heller Financial, Inc.,
subsequently amended by the Omnibus Agreement
Exhibit 19 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, and Jackson National Life
Insurance Company, subsequently amended by the Omnibus
Agreement
Exhibit 20 Investor Purchase Agreement, dated as of January 31, 1995,
by and between TCC, the Fund, and Jackson National Life
Insurance Company of Michigan, subsequently amended by the
Omnibus Agreement
Exhibit 21 Promissory Note, dated January 31, 1995, of MCS in favor of
TCC, subsequently amended by the Omnibus Agreement
(incorporated by reference from exhibit number 10.7 to
Coinmach's Registration Statement on Form S-1, file number
333-00620)
Exhibit 22 Promissory Note, dated January 31, 1995, of Mitchell Blatt
in favor of TCC, subsequently amended by the Omnibus
Agreement (incorporated by reference from exhibit number
10.8 to Coinmach's Registration Statement on Form S-1, file
number 333-00620)
Exhibit 23 Promissory Note, dated January 31, 1995, of David Tulkop in
favor of TCC, subsequently amended by the Omnibus Agreement
<PAGE>
Exhibit 24 Promissory Note, dated January 31, 1995, of Robert M. Doyle in
favor of TCC, subsequently amended by the Omnibus Agreement
Exhibit 25 Promissory Note, dated January 31, 1995, of Russell Harrison in
favor of TCC, subsequently amended by the Omnibus Agreement
Exhibit 26 Promissory Note, dated January 31, 1995, of Charles Prato in
favor of TCC, subsequently amended by the Omnibus Agreement
Exhibit 27 Executive Stock Agreement, dated January 31, 1995, by and
between TCC, the Fund and Charles Prato, subsequently
amended by the Omnibus Agreement
Exhibit 28 Executive Stock Agreement, dated January 31, 1995, by and
between TCC, the Fund and Russell Harrison, subsequently
amended by the Omnibus Agreement
Exhibit 29 Executive Stock Agreement, dated January 31, 1995, by and
between TCC, the Fund and David Tulkop, subsequently amended
by the Omnibus Agreement
Exhibit 30 Senior Management Agreement, dated as of January 31, 1995, by
and between TCC, Stephen R. Kerrigan, MCS and the Fund,
subsequently amended by the Omnibus Agreement (incorporated
by reference from exhibit number 10.10 to Coinmach's
Registration Statement on Form S-1, file number 333-00620)
Exhibit 31 Senior Management Agreement, dated as of January 31, 1995, by
and between TCC, Coinmach Industries Co., L.P., Mitchell
Blatt and the Fund, subsequently amended by the Omnibus
Agreement (incorporated by reference from exhibit number
10.11 to Coinmach's Registration Statement on Form S-1, file
number 333-00620)
Exhibit 32 Senior Management Agreement, dated January 31, 1995, by and
between TCC, Coinmach Industries Co., L.P., Robert M. Doyle
and the Fund, subsequently amended by the Omnibus Agreement
(incorporated by reference from exhibit number 10.12 to
Coinmach's Registration Statement on Form S-1, file number
333-00620)
Exhibit 33 Equity Purchase Agreement, dated as of July 26, 1995, among the
Fund and SAS, subsequently amended by the Omnibus Agreement
(incorporated by reference from exhibit number 10.21 to the
Issuer's Registration Statement on Form S-1, file number
333-03587)
Exhibit 34 Investor Purchase Agreement, dated as of July 26, 1995, among
SAS, the Fund, Heller Financial Services, Inc., Jackson
National Life Insurance Company, Jackson National Life
Insurance Company of Michigan, James N. Chapman, Michael E.
Marrus, Harvard, MCS, Mitchell Blatt, and Michael Stanky,
subsequently amended by the Omnibus Agreement (incorporated by
reference from exhibit number 10.22 to the Issuer's
Registration Statement on Form S-1, file number 333-03587)
Exhibit 35 Executive Stock Agreement, dated as of July 26, 1995, among
SAS, the Fund, MCS, Mitchell Blatt, Robert M. Doyle and Michael
Stanky (with spousal consents), subsequently amended by the
Omnibus Agreement (incorporated by reference from exhibit
number 10.23 to the Issuer's Registration Statement on Form S-
1, file number 333-03587)
Exhibit 36 Omnibus Agreement, dated as of November 30, 1995, among SAS,
Solon, TCC and each of the other parties executing a signature
page thereto (incorporated by
<PAGE>
reference from exhibit number 10.20 to Coinmach's Registration
Statement of Form S-1, file number 333-00620)
Exhibit 37 Promissory Note, dated as of July 26, 1995, of MCS in favor of
SAS
Exhibit 38 Promissory Note, dated as of July 26, 1995, of Mitchell Blatt
in favor of SAS
Exhibit 39 Promissory Note, dated as of July 26, 1995, of Robert M. Doyle
in favor of SAS
Exhibit 40 Promissory Note, dated as of July 26, 1995, of Michael Stanky
in favor of SAS
Exhibit 41 Stock Subscription Agreement, dated May 10, 1996, by and
between Mitchell Blatt and the Issuer
Exhibit 42 Stock Subscription Agreement, dated May 10, 1996, by and
between Robert M. Doyle and the Issuer
Exhibit 43 Stock Subscription Agreement, dated May 10, 1996, by and
between MCS and the Issuer
Exhibit 44 Promissory Note, dated May 10, 1996, by Mitchell Blatt in
favor of the Issuer
Exhibit 45 Promissory Note, dated May 10, 1996, by Robert M. Doyle in
favor of the Issuer
Exhibit 46 Promissory Note, dated May 10, 1996, by MCS in favor of the
Issuer
Exhibit 47 Common Stock Purchase Agreement, dated July 10, 1996, by
and between MCS Capital Management, Inc. and Robert M. Doyle
Exhibit 48 Common Stock Purchase Agreement, dated July 10, 1996, by and
between MCS Capital Management, Inc. and S.A. Spencer
Exhibit 49 Common Stock Purchase Agreement, dated July 10, 1996, by and
between MCS Capital Management, Inc. and MCS
Exhibit 50 Registration Agreement, dated as of July 26, 1995, among the
Issuer and certain of its stockholders (incorporated by
reference to exhibit number 10.25 to Issuer's Registration
Statement on Form S-1, file number 333-03587)
Exhibit 51 Reclassification Agreement, dated as of July 17, 1995, among
the Issuer and certain of its stockholders (incorporated by
reference from exhibit number 10.45 to Issuer's Form 10-Q for
the quarterly period ended June 28, 1996, file number 1-11907)
Exhibit 52 Second Amended and Restated 1996 Employee Stock Option Plan of
Coinmach Laundry Corporation
Exhibit 53 Omnibus Amendment to Option Agreements, dated as of September
17, 1996, by and among the Issuer, MCS Capital, Inc., Ronald S.
Brody, James N. Chapman, Robert M. Doyle, Michael E. Stanky,
David E. Siegel, R. Daniel Osborne, John E. Denson, James
McDonnell, Russell Harrison, Charles Prato and Michael E.
Marrus
<PAGE>
SIGNATURE
---------
After reasonable inquiry and to the best of our knowledge and belief,
the undersigned certify that the information set forth in this Statement is
true, complete and correct.
Dated: October 10, 1996
MCS CAPITAL, INC.
By: /s/ Stephen R. Kerrigan
-------------------------------------
Stephen R. Kerrigan
President
/s/ Stephen R. Kerrigan
-----------------------------------------
Stephen R. Kerrigan
PRESIDENT AND FELLOWS OF HARVARD COLLEGE
By: HARVARD MANAGEMENT COMPANY, INC.
By: /s/ Timothy Peterson
-------------------------------------
Name: Timothy Peterson
Title: Authorized Signatory
By: /s/ Verne Sedlacek
______________________________________
Name: Verne Sedlacek
Title: Authorized Signatory
HARVARD MANAGEMENT COMPANY, INC.
By: /s/ Timothy Peterson
-------------------------------------
Name: Timothy Peterson
Title: Authorized Signatory
/s/ Mitchell Blatt
------------------------------------------
Mitchell Blatt
/s/ Robert M. Doyle
------------------------------------------
Robert M. Doyle
/s/ Michael E. Stanky
------------------------------------------
Michael E. Stanky
/s/ Charles Prato
------------------------------------------
Charles Prato
/s/ James N. Chapman
------------------------------------------
James N. Chapman
/s/ Michael E. Marrus
------------------------------------------
Michael E. Marrus
<PAGE>
/s/ David Tulkop
___________________________________________
David Tulkop
/s/ Russell Harrison
___________________________________________
Russell Harrison
/s/ S.A. Spencer
___________________________________________
S.A. Spencer
/s/ Mary M. Spencer
___________________________________________
Mary M. Spencer
<PAGE>
SCHEDULE A
The following table sets forth the names of the executive officers and
fellows of President and Fellows of Harvard College. Each such person is a
citizen of the United States and has a business address at c/o Harvard, 600
Atlantic Avenue, Boston, Massachusetts 02210.
Name Position with Harvard
- ---- ---------------------
Neil Rudenstine President
Michael Roberts Secretary
D. Ronald Daniel Treasurer
Robert G. Stone, Jr. Fellow
Judith Richards Hope Fellow
Richard A. Smith Fellow
Jamie Houghton Fellow
Professor Henry Rosovsky Fellow
Margaret H. Marshall Vice President and General Counsel
Sally Zeckhauser Vice President
Thomas Reardan Vice President of Alumni Affairs
Elizabeth C. Hviddecoper Vice President of Financial Affairs
Albert Carnesale Provost
James Rowe Vice President of Governmental Affairs
<PAGE>
EXHIBIT 1
JOINT FILING AGREEMENT
In accordance with Rule 13d-1(f)(1)(iii) promulgated under the Securities
Exchange Act of 1934, as amended, the persons named below agree to the Joint
Filing on behalf of each of them of a Schedule 13D with respect to the Common
Stock of Coinmach Laundry Corporation, a Delaware corporation, and any further
amendments thereto. This Joint Filing Agreement shall be filed as an Exhibit to
the Statement on Schedule 13D.
Dated: October __, 1996
MCS CAPITAL, INC.
By: /s/ STEPHEN R. KERRIGAN
----------------------------------------
Stephen R. Kerrigan
President
/s/ STEPHEN R. KERRIGAN
-------------------------------------------
Stephen R. Kerrigan
PRESIDENT AND FELLOWS OF HARVARD COLLEGE
By: HARVARD MANAGEMENT COMPANY, INC.
By:/s/ TIMOTHY PETERSON
----------------------------------------
Name: Timothy Peterson
Title: Authorized Signatory
By: /s/ VERNE SEDLACEK
----------------------------------------
Name: Verne Sedlacek
Title: Authorized Signatory
HARVARD MANAGEMENT COMPANY, INC.
By: /s/ TIMOTHY PETERSON
----------------------------------------
Name: Timothy Peterson
Title: Authorized Signatory
-1-
<PAGE>
/s/ MITCHELL BLATT
-------------------------------------------
Mitchell Blatt
/s/ ROBERT M. DOYLE
-------------------------------------------
Robert M. Doyle
/s/ MICHAEL E. STANKY
-------------------------------------------
Michael E. Stanky
/s/ CHARLES PRATO
-------------------------------------------
Charles Prato
/s/ JAMES N. CHAPMAN
-------------------------------------------
James N. Chapman
/s/ MICHAEL E. MARRUS
-------------------------------------------
Michael E. Marrus
/s/ DAVID TULKOP
-------------------------------------------
David Tulkop
/s/ RUSSELL HARRISON
-------------------------------------------
Russell Harrison
/s/ S.A. SPENCER
-------------------------------------------
S.A. Spencer
/s/ MARY M. SPENCER
-------------------------------------------
Mary M. Spencer
-2-
<PAGE>
EXHIBIT 7
[PRATO]
OPTION AGREEMENT
----------------
THIS OPTION AGREEMENT (the "Agreement") is made and entered into this 23rd
---------
day of July, 1996, by and between Coinmach Laundry Corporation, a Delaware
corporation (the "Corporation"), and Charles Prato (the "Optionee").
----------- --------
RECITALS
--------
A. Optionee, an employee of the Corporation, has made and continues to
make valuable contributions to the Corporation, which have been, and or will be
important to the success of the Corporation and has rendered and continues to
render certain managerial and advisory and/or other similar services to the
Corporation (collectively, the "Services").
--------
B. In consideration for Optionee's continued provision of the Services,
the Corporation desires to grant to Optionee options to purchase shares of the
Corporation's common stock, par value $.01 per share (the "Common Stock"),
------------
subject to the terms and conditions of this Agreement.
C. In consideration for the grant of such options, Optionee desires to
continue to render Services to the Corporation.
AGREEMENT
---------
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Grant of Options. Subject to the terms and conditions contained
----------------
herein, the Corporation hereby grants to the Optionee, at no cost or expense to
Optionee of any kind, irrevocable options ("Options") to purchase from the
-------
Corporation 11,443 shares of Common Stock.
2. Non-qualified Stock Options. The Options represented hereby are
---------------------------
non-qualified stock options and are not intended by the Corporation to qualify
under any section of the Internal Revenue Code of 1986, as amended.
3. Exercise Price. Subject to the terms and conditions contained
--------------
herein, each of the Options shall entitle the Optionee to purchase one share of
Common Stock at an exercise price (the "Exercise Price") equal to $11.90 per
--------------
share.
<PAGE>
4. Terms of Options. Subject to the terms and conditions contained
----------------
herein, the Optionee shall be entitled to exercise Options to purchase an
aggregate of up to 11,443 shares of Common Stock. Such Options shall be
exercisable by Optionee subject to, and only to the extent that, (i) with
respect to any such option, such Option has vested in accordance with the
vesting schedule set forth below and (ii) at the time of exercise of such Option
all conditions to exercise set forth in this Agreement are satisfied to the
reasonable satisfaction of the board of directors of the Corporation (the
"Board").
-----
Number of Options Vesting
Vesting Date on the Vesting Date
--------------- -------------------------
July 23, 1996 2,291
July 23, 1997 2,288
July 23, 1998 2,288
July 23, 1999 2,288
July 23, 2000 2,288
Notwithstanding any provision to the contrary in this Agreement, any
and all Options not exercised on or prior to July 23, 2006 (whether or not
exercisable at such time) shall automatically expire, and Optionee shall have no
rights in or to such Options after such date. The period from the date hereof
to July 23, 2006, shall be referred to herein as the "Option Period".
-------------
5. Conditions to Exercise of Options. No Option may be exercised by
---------------------------------
Optionee to the extent that, at the time of such proposed exercise, Optionee is
not, in the reasonable discretion of the Board, providing, when and as requested
by the Corporation, Services in a manner and on economic terms reasonably
satisfactory to the Corporation and consistent with past practice; provided,
--------
however, that (i) upon Optionee's death or incapacitation or (ii) upon
- -------
termination of Optionee's employment by the Corporation without Cause, Optionee
shall be entitled to exercise, pursuant to the terms and conditions of this
Agreement, all Options that have vested on or prior to the date of death or
incapacitation or termination, as the case may be. For purposes of this
Agreement, "Cause" means (i) a material breach of any agreement with the
-----
Corporation, its subsidiaries, affiliates or corporate parent or its
stockholders by Optionee (after notice and reasonable opportunity to cure), (ii)
a breach of Optionee's duty of loyalty to the Corporation or any of its
subsidiaries, affiliates or corporate parent or any act of dishonesty, gross
negligence, willful misconduct or fraud with respect to the Corporation or any
of its subsidiaries, affiliates or corporate parent or any of their respective
stockholders, customers or suppliers, (iii) the commission by Optionee of a
felony, a crime involving moral turpitude or other act or omission tending to
cause harm to the standing and reputation of, or otherwise bring public disgrace
or disrepute to, the
-2-
<PAGE>
Corporation or any of its subsidiaries, affiliates or corporate parent, (iv)
Optionee's continued failure or refusal to perform any material duty to the
Corporation or any of its subsidiaries, affiliates or corporate parent which is
normally attached to his position (after notice and reasonable opportunity to
cure), or (v) Optionee's gross negligence or willful misconduct in performing
those duties which are normally attached to his position (after notice and
reasonable opportunity to cure). For purposes of this Agreement, "Optionee's
----------
duty of loyalty to the Corporation or any of its subsidiaries, affiliates or
- ----------------------------------------------------------------------------
corporate parent" shall include Optionee's fiduciary obligation to place the
- ----------------
interests of the Corporation and its subsidiaries, affiliates or corporate
parent ahead of his personal interests and thereby not knowingly profit
personally at the expense of the Corporation or any of its subsidiaries,
affiliates or corporate parent, and shall also include specifically the
affirmative obligation to disclose promptly to the Board any known conflicts of
interest Optionee may have with respect to the Corporation and its subsidiaries,
affiliates or corporate parent, and the negative obligations not to usurp
corporate opportunities of the Corporation or any of its subsidiaries,
affiliates or corporate parent, not to engage in any "conflict-of-interest"
transactions with the Corporation or its subsidiaries, affiliates or corporate
parent (without the approval of the Board), and not to compete directly with the
Corporation or its subsidiaries, affiliates or corporate parent (without the
approval of the Board).
6. Exercise Procedure. The Options may be exercised by Optionee,
------------------
subject to the terms and conditions contained herein, in whole or in part, at
any time during the Option Period by prior written notice delivered to the
Corporation. Such notice shall set forth the number of shares of Common Stock
to be purchased. Upon receipt thereof, the Corporation and the Optionee shall
mutually agree to a time and date, not later than 30 days from the delivery date
of such notice, on which to close the exercise of such Options (the "Closing").
-------
7. Closing. At or prior to the Closing, the Optionee shall have
-------
delivered to the Corporation (a) the aggregate Exercise Price of the Options
paid in cash or by certified or bank check or wire transfer to an account
designated by the Corporation. At such time that the Corporation is able to
confirm to its reasonable satisfaction receipt in full of the Exercise Price,
the Corporation shall deliver to Optionee a certificate representing the shares
of Common Stock issued upon exercise of the Options as soon as practicable
thereafter.
8. Fractional Shares; Calculations. The Corporation shall not be
-------------------------------
required to issue fractions of a share of Common Stock upon exercise of the
Options. The number of shares of Common Stock subject to the Optionee's Options
shall be rounded to the nearest whole share and the aggregate number of shares
subject to the Options shall be adjusted accordingly. All
-3-
<PAGE>
calculations required to be made hereunder shall, prior to such rounding, be
carried out to at least the third decimal place.
9. Changes in Stock.
----------------
(a) Subject to any required action by the stockholders of the
Corporation, if at any time while one or more Options granted hereunder are
outstanding, the outstanding shares of Common Stock are increased or decreased
or changed into or exchanged for a different number or kind of shares of the
Corporation through a stock dividend, stock split, reverse stock split, stock
combination, reclassification, reorganization, merger, consolidation or similar
change in corporate structure affecting the kind or number of issued shares of
Common Stock as a class, the Corporation shall equitably adjust the number,
kind, and purchase price of the shares subject to the Option so that the
Optionee shall be entitled to purchase the number of shares which the Optionee
would have received, as a result of the capital change, for the shares of Common
Stock that he would have acquired by exercising the Option immediately prior to
such capital change, for the same aggregate Exercise Price as the Optionee would
have paid at the prior time.
(b) In case the Corporation shall be a party to any transaction
(including, without limitation, a merger, consolidation, sale of all or
substantially all of the Corporation's assets or a recapitalization of the
Common Stock) in which the previously outstanding shares of Common Stock shall
be changed into or exchanged for different securities of the Corporation or
common stock or other securities of another corporation or interests in a
noncorporate entity or other property (including cash) or any combination of any
of the foregoing or in case the Corporation shall pay any dividend or make any
distribution to the holders of its Common Stock, other than regularly-scheduled
cash dividends (each such transaction being herein called a "Transaction" and
-----------
the date of consummation of a Transaction being herein called a "Consummation
------------
Date"), then lawful and adequate provision shall be made so that upon the
- ----
exercise hereof at any time after the Consummation Date of such Transaction, the
Optionee shall be entitled to receive, in lieu of the Common Stock issuable
hereunder, the kind and amount of securities or other property to which he or
she would actually have been entitled as a stockholder of the Corporation upon
the consummation of such Transaction, if the Optionee had exercised his Options
immediately prior thereto. The provisions of this Section 9(b) shall similarly
apply to successive Transactions.
10. No Voting or Dividend Rights or Rights to Continued Employment.
--------------------------------------------------------------
Except as may be specifically provided in Section 9 hereof, nothing contained
herein shall be construed as conferring upon the Optionee the rights of a
stockholder of the Corporation in respect of the shares subject to the Options,
including without limitation, the right to vote as a stockholder, or to receive
any dividends paid or other distributions made to,
-4-
<PAGE>
stockholders. If Optionee is, or hereinafter becomes, an employee or director
of the Corporation or any subsidiary thereof, nothing contained in this
Agreement shall be deemed to confer upon Optionee any right to continued
employment with, or a continued officer or directorship position with, the
Corporation or any subsidiary thereof, nor shall it interfere in any way with
the right of the Corporation to terminate Optionee in accordance with the
provisions regarding such termination set forth in Optionee's written employment
agreement with the Corporation, or if there exists no such agreement, to
terminate Optionee at will, and/or terminate Optionee's directorship or officer
position in accordance with the Corporation's Certificate of Incorporation and
By-laws and/or applicable law, as the case may be.
11. Withholding Tax. Not later than the date as of which an amount
---------------
first must be included in the gross income of Optionee for Federal income tax
purposes with respect to the Options, Optionee may be required to pay the
Corporation, or make arrangements satisfactory to the Corporation regarding the
payment of, any Federal, state and local taxes of any kind required by law to be
withheld or paid with respect to such amount. The obligations of the
Corporation pursuant to this Agreement shall be conditional upon such payments
or arrangements with the Corporation, if such payments or arrangements are
required, and the Corporation shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to
Optionee from the Corporation.
12. Restrictions on Transferability; Legends.
----------------------------------------
(a) This Agreement, the Options granted hereby, the shares of Common
Stock issuable upon exercise thereof, and any other securities issuable pursuant
to Section 9 hereof (collectively, the "Securities") shall not be transferable
----------
by the Optionee without the prior written consent of the Corporation. No
transfer of the Options by Optionee by will or by the laws of descent and
distribution shall be effective to bind the Corporation unless the Corporation
shall have been furnished with written notice thereof and a copy of the will
and/or such other evidence as the Corporation may deem necessary to establish
the validity of the transfer and the acceptance by the transferee or transferees
of the terms and conditions of this Agreement and the Options.
(b) Anything in this Agreement to the contrary notwithstanding,
Optionee hereby agrees that Optionee shall not sell, transfer by any means or
otherwise dispose of the Securities without registration under the Securities
Act of 1933, as amended (the "1933 Act"), and compliance with state securities
--------
and Blue Sky laws, or in the event that they are not so registered, unless (i)
an exemption from the 1933 Act registration requirements is available
thereunder, and (ii) Optionee has furnished the Corporation with written notice
of such proposed transfer, and the Corporation's legal counsel, in
-5-
<PAGE>
its reasonable opinion, shall deem such proposed transfer to be so exempt.
(c) Anything in this Agreement to the contrary notwithstanding,
Optionee hereby agrees that Optionee shall not sell, transfer by any means or
otherwise dispose of the Securities, except in accordance with (i) the
Corporation's policy, if any, regarding the sale and disposition of securities
owned by employees, directors and/or officers of the Corporation, (ii) an
agreement among the stockholders of the Corporation in effect at the time of the
sale of the shares of Common Stock issuable upon exercise of the Options, or
(iii) if such an agreement set forth in clause (ii) above is not in effect, an
agreement among the stockholders of the Corporation reasonably acceptable to the
Corporation pursuant to which the stockholders of the Corporation may, among
other things, establish certain restrictions and rights to maintain continuity
of ownership and control of the Corporation.
(d) Each certificate representing the shares of Common Stock issuable
upon exercise of the Options shall be stamped or otherwise imprinted with the
legends in substantially the following forms:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN
MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT
OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH
LAWS, WHICH, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL
AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR THIS
CORPORATION, IS AVAILABLE.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
PURSUANT TO AN OPTION AGREEMENT, DATED AS OF JULY 23, 1996, A COPY OF
WHICH IS ON FILE WITH THE CORPORATION, AND MAY NOT BE TRANSFERRED,
PLEDGED OR DISPOSED OF EXCEPT IN ACCORDANCE WITH THE TERMS AND
CONDITIONS THEREOF.
13. Representations and Warranties of the Corporation. The
-------------------------------------------------
Corporation hereby represents and warrants to, and agrees with, the Optionee
that as of the date hereof:
-6-
<PAGE>
(a) The Corporation is a Corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware.
(b) The Corporation has full corporate power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to carry
out the transactions contemplated hereby. All corporate acts and other
corporate proceedings required to be taken by or on the part of the Corporation
to authorize the Corporation to carry out this Agreement and the transactions
contemplated hereby have been duly and properly taken.
(c) The shares of Common Stock issuable upon exercise of the Options
have been duly authorized, and when such shares are issued to the Optionee in
accordance with this Agreement, such shares will be validly issued, fully paid
and non-assessable. The Corporation has reserved the required number of shares
of Common Stock for issuance upon exercise of the Options based on the number of
issued and outstanding shares of Common Stock on the date hereof and assuming
the exercise of all of the Options, and will, from time to time, reserve such
additional shares of Common Stock as may become issuable upon exercise of the
Options.
14. Representations and Warranties of the Optionee. The Optionee
----------------------------------------------
hereby represents and warrants to, and agrees with, the Corporation that as of
the date hereof:
(a) Optionee has the requisite legal capacity to execute and deliver
this Agreement, to perform its, his or her other obligations hereunder and to
carry out the transactions contemplated hereby.
(b) Optionee is acquiring and shall acquire the shares of Common Stock
issuable upon exercise of the Options, for Optionee's own account and not with a
view towards the distribution thereof in violation of applicable Federal and
state securities laws.
(c) Optionee acknowledges and agrees that (a) Optionee must bear the
economic risk of the investment in the shares of Common Stock issuable upon
exercise of the Options, which may not be sold by Optionee unless registered
under the 1933 Act or an exemption therefrom is available thereunder and (b) the
Corporation is under no obligation to register the Options or the shares of
Common Stock issuable upon exercise of the Options for sale under the 1933 Act.
(d) Optionee has had both the opportunity to ask questions and receive
answers from the officers and directors of the Corporation and all persons
acting on the Corporation's behalf concerning the terms and conditions of the
Options and this Agreement.
-7-
<PAGE>
(e) Optionee is aware that the Corporation shall place stop transfer
orders with its transfer agent against the transfer of the shares of Common
Stock issuable upon exercise of the Options in the absence of registration under
the 1933 Act or exemption therefrom as provided herein.
15. No Finders. Neither the Corporation nor the individual parties
----------
hereto have engaged any finder or broker in connection with the execution and
delivery of this Agreement.
16. Notices. Any notice or other communication to be given by any
-------
party hereunder to any other party shall be in writing, delivered personally,
mailed by certified or registered mail, return receipt requested, or sent by a
nationally recognized courier service, and shall be addressed to such party at
its address hereinabove stated or to such other address as may have been
furnished by any party to the other parties pursuant to this Section 16, and
shall be deemed to be given on the date of receipt.
17. Miscellaneous.
-------------
(a) Governing Law; Arbitration; Jurisdiction. This Agreement shall be
----------------------------------------
enforced, governed and construed in all respects in accordance with the laws of
the State of New York, without regard to its principles of conflicts of laws.
Any dispute arising hereunder shall be resolved by arbitration before the
American Arbitration Association in the City of New York, pursuant to the rules
of said body then obtaining; provided that any party may seek injunctive or
--------
other equitable relief pursuant to the terms hereof and for such purpose, the
parties hereto irrevocably submit to the exclusive personal jurisdiction of any
state or Federal court located in New York County. The parties irrevocably
waive, to the fullest extent permitted by law, any objection to which they may
now or hereafter have to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that any such suit, action or
proceeding has been brought in an inconvenient forum.
(b) Severability. If any provision of this Agreement is invalid or
------------
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any
provision hereof that may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision hereof.
(c) Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto with respect to the subject matter hereof and may be
amended only by a writing executed by both parties hereto.
-8-
<PAGE>
(d) Headings. The headings of this Agreement are for convenience only
--------
and shall not affect the meaning of the terms hereof.
(e) Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
(f) Waiver. The waiver by any party hereto of a breach of any
------
provision of this Agreement shall not operate or be construed as a waiver of any
other or subsequent breach.
[SIGNATURE PAGE TO FOLLOW]
-9-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
COINMACH LAUNDRY CORPORATION
By: /s/ ROBERT M. DOYLE
------------------------------
Name: Robert M. Doyle
Title Senior Vice President
/s/ CHARLES PRATO
-----------------------------------
Charles Prato
-10-
<PAGE>
EXHIBIT 8
[Marrus]
OPTION AGREEMENT
----------------
THIS OPTION AGREEMENT (the "Agreement") is made and entered into this 23rd
---------
day of July, 1996, by and between Coinmach Laundry Corporation, a Delaware
corporation (the "Corporation"), and Michael E. Marrus (the "Optionee").
----------- --------
RECITALS
--------
A. Optionee has rendered certain managerial and advisory and/or other
similar services to the Corporation (the "Services").
B. In consideration for Optionee's continued provision of the Services,
the Corporation desires to grant to Optionee options to purchase shares of the
Corporation's common stock, par value $.01 per share (the "Common Stock"),
------------
subject to the terms and conditions of this Agreement.
C. In consideration for the grant of such options, Optionee desires to
continue to render Services to the Corporation.
AGREEMENT
---------
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Grant of Options. Subject to the terms and conditions contained
----------------
herein, the Corporation hereby grants to the Optionee, at no cost or expense to
Optionee of any kind, irrevocable options ("Options") to purchase from the
-------
Corporation 28,607 shares of Common Stock.
2. Non-qualified Stock Options. The Options represented hereby are
---------------------------
non-qualified stock options and are not intended by the Corporation to qualify
under any section of the Internal Revenue Code of 1986, as amended.
3. Exercise Price. Subject to the terms and conditions contained
--------------
herein, each of the Options shall entitle the Optionee to purchase one share of
Common Stock at an exercise price (the "Exercise Price") equal to $11.90 per
--------------
share.
4. Terms of Options. Subject to the terms and conditions contained
----------------
herein, the Optionee shall be entitled to exercise Options to purchase an
aggregate of up to 28,607 shares of Common Stock. Such Options shall be
exercisable by Optionee subject to, and only to the extent that, (i) with
respect to any
<PAGE>
such option, such Option has vested in accordance with the vesting schedule set
forth below and (ii) at the time of exercise of such Option all conditions to
exercise set forth in this Agreement are satisfied to the reasonable
satisfaction of the board of directors of the Company (the "Board").
Number of Options Vesting
Vesting Date on the Vesting Date
------------ -------------------------
July 23, 1996 5,723
July 23, 1997 5,721
July 23, 1998 5,721
July 23, 1999 5,721
July 23, 2000 5,721
Notwithstanding any provision to the contrary in this Agreement, any
and all Options not exercised on or prior to July 23, 2006 (whether or not
exercisable at such time) shall automatically expire, and Optionee shall have no
rights in or to such Options after such date. The period from the date hereof
to July 23, 2006, shall be referred to herein as the "Option Period".
5. Conditions to Exercise of Options. No Option may be exercised by
---------------------------------
Optionee to the extent that, at the time of such proposed exercise, (i) Optionee
is, directly or indirectly, obligated, liable or indebted to the Corporation in
an amount in excess of $50,000; or (ii) Optionee is not, in the reasonable
discretion of the Board, providing, when and as requested by the Corporation,
Services in a manner and on economic terms reasonably satisfactory to the
Corporation and consistent with past practice.
6. Exercise Procedure. The Options may be exercised by Optionee,
------------------
subject to the terms and conditions contained herein, in whole or in part, at
any time during the Option Period by prior written notice delivered to the
Corporation. Such notice shall set forth the number of shares of Common Stock
to be purchased. Upon receipt thereof, the Corporation and the Optionee shall
mutually agree to a time and date, not later than 30 days from the delivery date
of such notice, on which to close the exercise of such Options (the "Closing").
-------
7. Closing. At or prior to the Closing, the Optionee shall have
-------
delivered to the Corporation (a) the aggregate Exercise Price of the Options
paid in cash or by certified or bank check or wire transfer to an account
designated by the Corporation. At such time that the Corporation is able to
confirm to its reasonable satisfaction receipt in full of the Exercise Price,
the Corporation shall deliver to Optionee a certificate representing the shares
of Common Stock issued upon exercise of the Options as soon as practicable
thereafter.
-2-
<PAGE>
8. Fractional Shares; Calculations. The Corporation shall not be
-------------------------------
required to issue fractions of a share of Common Stock upon exercise of the
Options. The number of shares of Common Stock subject to the Optionee's Options
shall be rounded to the nearest whole share and the aggregate number of shares
subject to the Options shall be adjusted accordingly. All calculations required
to be made hereunder shall, prior to such rounding, be carried out to at least
the third decimal place.
9. Changes in Stock.
----------------
(a) Subject to any required action by the stockholders of the
Corporation, if at any time while one or more Options granted hereunder are
outstanding, the outstanding shares of Common Stock are increased or decreased
or changed into or exchanged for a different number or kind of shares of the
Corporation through a stock dividend, stock split, reverse stock split, stock
combination, reclassification, reorganization, merger, consolidation or similar
change in corporate structure affecting the kind or number of issued shares of
Common Stock as a class, the Corporation shall equitably adjust the number,
kind, and purchase price of the shares subject to the Option so that the
Optionee shall be entitled to purchase the number of shares which the Optionee
would have received, as a result of the capital change, for the shares of Common
Stock that he would have acquired by exercising the Option immediately prior to
such capital change, for the same aggregate Exercise Price as the Optionee would
have paid at the prior time.
(b) In case the Corporation shall be a party to any transaction
(including, without limitation, a merger, consolidation, sale of all or
substantially all of the Corporation's assets or a recapitalization of the
Common Stock) in which the previously outstanding shares of Common Stock shall
be changed into or exchanged for different securities of the Corporation or
common stock or other securities of another corporation or interests in a
noncorporate entity or other property (including cash) or any combination of any
of the foregoing or in case the Corporation shall pay any dividend or make any
distribution to the holders of its Common Stock, other than regularly-scheduled
cash dividends (each such transaction being herein called a "Transaction" and
-----------
the date of consummation of a Transaction being herein called a "Consummation
------------
Date"), then lawful and adequate provision shall be made so that upon the
- ----
exercise hereof at any time after the Consummation Date of such Transaction, the
Optionee shall be entitled to receive, in lieu of the Common Stock issuable
hereunder, the kind and amount of securities or other property to which he or
she would actually have been entitled as a stockholder of the Corporation upon
the consummation of such Transaction, if the Optionee had exercised his Options
immediately prior thereto. The provisions of this Section 9(b) shall similarly
apply to successive Transactions.
-3-
<PAGE>
10. No Voting or Dividend Rights or Rights to Continued Employment.
--------------------------------------------------------------
Except as may be specifically provided in Section 9 hereof, nothing contained
herein shall be construed as conferring upon the Optionee the rights of a
stockholder of the Corporation in respect of the shares subject to the Options,
including without limitation, the right to vote as a stockholder, or to receive
any dividends paid or other distributions made to, stockholders. If Optionee
is, or hereinafter becomes, an employee or director of the Corporation or any
subsidiary thereof, nothing contained in this Agreement shall be deemed to
confer upon Optionee any right to continued employment with, or a continued
officer or directorship position with, the Corporation or any subsidiary
thereof, nor shall it interfere in any way with the right of the Corporation to
terminate Optionee in accordance with the provisions regarding such termination
set forth in Optionee's written employment agreement with the Corporation, or if
there exists no such agreement, to terminate Optionee at will, and/or terminate
Optionee's directorship or officer position in accordance with the Corporation's
Certificate of Incorporation and By-laws and/or applicable law, as the case may
be.
11. Withholding Tax. Not later than the date as of which an amount
---------------
first must be included in the gross income of Optionee for Federal income tax
purposes with respect to the Options, Optionee may be required to pay the
Corporation, or make arrangements satisfactory to the Corporation regarding the
payment of, any Federal, state and local taxes of any kind required by law to be
withheld or paid with respect to such amount. The obligations of the
Corporation pursuant to this Agreement shall be conditional upon such payments
or arrangements with the Corporation, if such payments or arrangements are
required, and the Corporation shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to
Optionee from the Corporation.
12. Restrictions on Transferability; Legends.
----------------------------------------
(a) This Agreement, the Options granted hereby, the shares of Common
Stock issuable upon exercise thereof, and any other securities issuable pursuant
to Section 9 hereof (collectively, the "Securities") shall not be transferable
----------
by the Optionee without the prior written consent of the Corporation. No
transfer of the Options by Optionee by will or by the laws of descent and
distribution shall be effective to bind the Corporation unless the Corporation
shall have been furnished with written notice thereof and a copy of the will
and/or such other evidence as the Corporation may deem necessary to establish
the validity of the transfer and the acceptance by the transferee or transferees
of the terms and conditions of this Agreement and the Options.
(b) Anything in this Agreement to the contrary notwithstanding,
Optionee hereby agrees that Optionee shall not sell, transfer by any means or
otherwise dispose of the
-4-
<PAGE>
Securities without registration under the Securities Act of 1933, as amended
(the "1933 Act"), and compliance with state securities and Blue Sky laws, or in
--------
the event that they are not so registered, unless (i) an exemption from the 1933
Act registration requirements is available thereunder, and (ii) Optionee has
furnished the Corporation with written notice of such proposed transfer, and the
Corporation's legal counsel, in its reasonable opinion, shall deem such proposed
transfer to be so exempt.
(c) Anything in this Agreement to the contrary notwithstanding,
Optionee hereby agrees that Optionee shall not sell, transfer by any means or
otherwise dispose of the Securities, except in accordance with (i) the
Corporation's policy, if any, regarding the sale and disposition of securities
owned by employees, directors and/or officers of the Corporation, (ii) an
agreement among the stockholders of the Corporation in effect at the time of the
sale of the shares of Common Stock issuable upon exercise of the Options, or
(iii) if such an agreement set forth in clause (ii) above is not in effect, an
agreement among the stockholders of the Corporation reasonably acceptable to the
Corporation pursuant to which the stockholders of the Corporation may, among
other things, establish certain restrictions and rights to maintain continuity
of ownership and control of the Corporation.
(d) Each certificate representing the shares of Common Stock issuable
upon exercise of the Options shall be stamped or otherwise imprinted with the
legends in substantially the following forms:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN
MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT
OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH
LAWS, WHICH, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL
AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR THIS
CORPORATION, IS AVAILABLE.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
PURSUANT TO AN OPTION AGREEMENT, DATED AS OF JULY 23, 1996, A COPY OF
WHICH IS ON FILE WITH THE CORPORATION, AND MAY NOT BE TRANSFERRED,
PLEDGED OR DISPOSED OF EXCEPT IN ACCORDANCE WITH THE TERMS AND
CONDITIONS THEREOF.
-5-
<PAGE>
13. Representations and Warranties of the Corporation. The
-------------------------------------------------
Corporation hereby represents and warrants to, and agrees with, the Optionee
that as of the date hereof:
(a) The Corporation is a Corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware.
(b) The Corporation has full corporate power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to carry
out the transactions contemplated hereby. All corporate acts and other
corporate proceedings required to be taken by or on the part of the Corporation
to authorize the Corporation to carry out this Agreement and the transactions
contemplated hereby have been duly and properly taken.
(c) The shares of Common Stock issuable upon exercise of the Options
have been duly authorized, and when such shares are issued to the Optionee in
accordance with this Agreement, such shares will be validly issued, fully paid
and non-assessable. The Corporation has reserved the required number of shares
of Common Stock for issuance upon exercise of the Options based on the number of
issued and outstanding shares of Common Stock on the date hereof and assuming
the exercise of all of the Options, and will, from time to time, reserve such
additional shares of Common Stock as may become issuable upon exercise of the
Options.
14. Representations and Warranties of the Optionee. The Optionee
----------------------------------------------
hereby represents and warrants to, and agrees with, the Corporation that as of
the date hereof:
(a) Optionee has the requisite legal capacity to execute and deliver
this Agreement, to perform its, his or her other obligations hereunder and to
carry out the transactions contemplated hereby.
(b) Optionee is acquiring and shall acquire the shares of Common Stock
issuable upon exercise of the Options, for Optionee's own account and not with a
view towards the distribution thereof in violation of applicable Federal and
state securities laws.
(c) Optionee acknowledges and agrees that (a) Optionee must bear the
economic risk of the investment in the shares of Common Stock issuable upon
exercise of the Options, which may not be sold by Optionee unless registered
under the 1933 Act or an exemption therefrom is available thereunder and (b) the
Corporation is under no obligation to register the Options or the shares of
Common Stock issuable upon exercise of the Options for sale under the 1933 Act.
-6-
<PAGE>
(d) Optionee has had both the opportunity to ask questions and receive
answers from the officers and directors of the Corporation and all persons
acting on the Corporation's behalf concerning the terms and conditions of the
Options and this Agreement.
(e) Optionee is aware that the Corporation shall place stop transfer
orders with its transfer agent against the transfer of the shares of Common
Stock issuable upon exercise of the Options in the absence of registration under
the 1933 Act or exemption therefrom as provided herein.
15. No Finders. Neither the Corporation nor the individual parties
----------
hereto have engaged any finder or broker in connection with the execution and
delivery of this Agreement.
16. Notices. Any notice or other communication to be given by any
-------
party hereunder to any other party shall be in writing, delivered personally,
mailed by certified or registered mail, return receipt requested, or sent by a
nationally recognized courier service, and shall be addressed to such party at
its address hereinabove stated or to such other address as may have been
furnished by any party to the other parties pursuant to this Section 16, and
shall be deemed to be given on the date of receipt.
17. Miscellaneous.
-------------
(a) Governing Law; Arbitration; Jurisdiction. This Agreement shall be
----------------------------------------
enforced, governed and construed in all respects in accordance with the laws of
the State of New York, without regard to its principles of conflicts of laws.
Any dispute arising hereunder shall be resolved by arbitration before the
American Arbitration Association in the City of New York, pursuant to the rules
of said body then obtaining; provided that any party may seek injunctive or
--------
other equitable relief pursuant to the terms hereof and for such purpose, the
parties hereto irrevocably submit to the exclusive personal jurisdiction of any
state or Federal court located in New York County. The parties irrevocably
waive, to the fullest extent permitted by law, any objection to which they may
now or hereafter have to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that any such suit, action or
proceeding has been brought in an inconvenient forum.
(b) Severability. If any provision of this Agreement is invalid or
------------
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any
provision hereof that may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision hereof.
-7-
<PAGE>
(c) Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto with respect to the subject matter hereof and may be
amended only by a writing executed by both parties hereto.
(d) Headings. The headings of this Agreement are for convenience only
--------
and shall not affect the meaning of the terms hereof.
(e) Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
(f) Waiver. The waiver by any party hereto of a breach of any
------
provision of this Agreement shall not operate or be construed as a waiver of any
other or subsequent breach.
[SIGNATURE PAGE TO FOLLOW]
-8-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
COINMACH LAUNDRY CORPORATION
By: /s/ ROBERT M. DOYLE
------------------------------
Name: Robert M. Doyle
Title Senior Vice President
/s/ MICHAEL E. MARRUS
-----------------------------------
Michael E. Marrus
-9-
<PAGE>
EXHIBIT 9
[HARRISON]
OPTION AGREEMENT
----------------
THIS OPTION AGREEMENT (the "Agreement") is made and entered into this 23rd
---------
day of July, 1996, by and between Coinmach Laundry Corporation, a Delaware
corporation (the "Corporation"), and Russell Harrison (the "Optionee").
----------- --------
RECITALS
--------
A. Optionee, an employee of the Corporation, has made and continues to
make valuable contributions to the Corporation, which have been, and or will be
important to the success of the Corporation and has rendered and continues to
render certain managerial and advisory and/or other similar services to the
Corporation (collectively, the "Services").
--------
B. In consideration for Optionee's continued provision of the Services,
the Corporation desires to grant to Optionee options to purchase shares of the
Corporation's common stock, par value $.01 per share (the "Common Stock"),
------------
subject to the terms and conditions of this Agreement.
C. In consideration for the grant of such options, Optionee desires to
continue to render Services to the Corporation.
AGREEMENT
---------
NOW THEREFORE, for good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, and intending to be legally bound hereby, the
parties hereto agree as follows:
1. Grant of Options. Subject to the terms and conditions contained
----------------
herein, the Corporation hereby grants to the Optionee, at no cost or expense to
Optionee of any kind, irrevocable options ("Options") to purchase from the
-------
Corporation 14,304 shares of Common Stock.
2. Non-qualified Stock Options. The Options represented hereby are
---------------------------
non-qualified stock options and are not intended by the Corporation to qualify
under any section of the Internal Revenue Code of 1986, as amended.
3. Exercise Price. Subject to the terms and conditions contained
--------------
herein, each of the Options shall entitle the Optionee to purchase one share of
Common Stock at an exercise price (the "Exercise Price") equal to $11.90 per
--------------
share.
<PAGE>
4. Terms of Options. Subject to the terms and conditions contained
----------------
herein, the Optionee shall be entitled to exercise Options to purchase an
aggregate of up to 14,304 shares of Common Stock. Such Options shall be
exercisable by Optionee subject to, and only to the extent that, (i) with
respect to any such option, such Option has vested in accordance with the
vesting schedule set forth below and (ii) at the time of exercise of such Option
all conditions to exercise set forth in this Agreement are satisfied to the
reasonable satisfaction of the board of directors of the Corporation (the
"Board").
-----
Number of Options Vesting
Vesting Date on the Vesting Date
------------ -------------------------
July 23, 1996 2,864
July 23, 1997 2,860
July 23, 1998 2,860
July 23, 1999 2,860
July 23, 2000 2,860
Notwithstanding any provision to the contrary in this Agreement, any
and all Options not exercised on or prior to July 23, 2006 (whether or not
exercisable at such time) shall automatically expire, and Optionee shall have no
rights in or to such Options after such date. The period from the date hereof
to July 23, 2006, shall be referred to herein as the "Option Period".
-------------
5. Conditions to Exercise of Options. No Option may be exercised by
---------------------------------
Optionee to the extent that, at the time of such proposed exercise, Optionee is
not, in the reasonable discretion of the Board, providing, when and as requested
by the Corporation, Services in a manner and on economic terms reasonably
satisfactory to the Corporation and consistent with past practice; provided,
--------
however, that (i) upon Optionee's death or incapacitation or (ii) upon
- -------
termination of Optionee's employment by the Corporation without Cause, Optionee
shall be entitled to exercise, pursuant to the terms and conditions of this
Agreement, all Options that have vested on or prior to the date of death or
incapacitation or termination, as the case may be. For purposes of this
Agreement, "Cause" means (i) a material breach of any agreement with the
-----
Corporation, its subsidiaries, affiliates or corporate parent or its
stockholders by Optionee (after notice and reasonable opportunity to cure), (ii)
a breach of Optionee's duty of loyalty to the Corporation or any of its
subsidiaries, affiliates or corporate parent or any act of dishonesty, gross
negligence, willful misconduct or fraud with respect to the Corporation or any
of its subsidiaries, affiliates or corporate parent or any of their respective
stockholders, customers or suppliers, (iii) the commission by Optionee of a
felony, a crime involving moral turpitude or other act or omission tending to
cause harm to the standing and reputation of, or otherwise bring public disgrace
or disrepute to, the
-2-
<PAGE>
Corporation or any of its subsidiaries, affiliates or corporate parent, (iv)
Optionee's continued failure or refusal to perform any material duty to the
Corporation or any of its subsidiaries, affiliates or corporate parent which is
normally attached to his position (after notice and reasonable opportunity to
cure), or (v) Optionee's gross negligence or willful misconduct in performing
those duties which are normally attached to his position (after notice and
reasonable opportunity to cure). For purposes of this Agreement, "Optionee's
----------
duty of loyalty to the Corporation or any of its subsidiaries, affiliates or
- ----------------------------------------------------------------------------
corporate parent" shall include Optionee's fiduciary obligation to place the
- ----------------
interests of the Corporation and its subsidiaries, affiliates or corporate
parent ahead of his personal interests and thereby not knowingly profit
personally at the expense of the Corporation or any of its subsidiaries,
affiliates or corporate parent, and shall also include specifically the
affirmative obligation to disclose promptly to the Board any known conflicts of
interest Optionee may have with respect to the Corporation and its subsidiaries,
affiliates or corporate parent, and the negative obligations not to usurp
corporate opportunities of the Corporation or any of its subsidiaries,
affiliates or corporate parent, not to engage in any "conflict-of-interest"
transactions with the Corporation or its subsidiaries, affiliates or corporate
parent (without the approval of the Board), and not to compete directly with the
Corporation or its subsidiaries, affiliates or corporate parent (without the
approval of the Board).
6. Exercise Procedure. The Options may be exercised by Optionee,
------------------
subject to the terms and conditions contained herein, in whole or in part, at
any time during the Option Period by prior written notice delivered to the
Corporation. Such notice shall set forth the number of shares of Common Stock
to be purchased. Upon receipt thereof, the Corporation and the Optionee shall
mutually agree to a time and date, not later than 30 days from the delivery date
of such notice, on which to close the exercise of such Options (the "Closing").
-------
7. Closing. At or prior to the Closing, the Optionee shall have
-------
delivered to the Corporation (a) the aggregate Exercise Price of the Options
paid in cash or by certified or bank check or wire transfer to an account
designated by the Corporation. At such time that the Corporation is able to
confirm to its reasonable satisfaction receipt in full of the Exercise Price,
the Corporation shall deliver to Optionee a certificate representing the shares
of Common Stock issued upon exercise of the Options as soon as practicable
thereafter.
8. Fractional Shares; Calculations. The Corporation shall not be
-------------------------------
required to issue fractions of a share of Common Stock upon exercise of the
Options. The number of shares of Common Stock subject to the Optionee's Options
shall be rounded to the nearest whole share and the aggregate number of shares
subject to the Options shall be adjusted accordingly. All
-3-
<PAGE>
calculations required to be made hereunder shall, prior to such rounding, be
carried out to at least the third decimal place.
9. Changes in Stock.
----------------
(a) Subject to any required action by the stockholders of the
Corporation, if at any time while one or more Options granted hereunder are
outstanding, the outstanding shares of Common Stock are increased or decreased
or changed into or exchanged for a different number or kind of shares of the
Corporation through a stock dividend, stock split, reverse stock split, stock
combination, reclassification, reorganization, merger, consolidation or similar
change in corporate structure affecting the kind or number of issued shares of
Common Stock as a class, the Corporation shall equitably adjust the number,
kind, and purchase price of the shares subject to the Option so that the
Optionee shall be entitled to purchase the number of shares which the Optionee
would have received, as a result of the capital change, for the shares of Common
Stock that he would have acquired by exercising the Option immediately prior to
such capital change, for the same aggregate Exercise Price as the Optionee would
have paid at the prior time.
(b) In case the Corporation shall be a party to any transaction
(including, without limitation, a merger, consolidation, sale of all or
substantially all of the Corporation's assets or a recapitalization of the
Common Stock) in which the previously outstanding shares of Common Stock shall
be changed into or exchanged for different securities of the Corporation or
common stock or other securities of another corporation or interests in a
noncorporate entity or other property (including cash) or any combination of any
of the foregoing or in case the Corporation shall pay any dividend or make any
distribution to the holders of its Common Stock, other than regularly-scheduled
cash dividends (each such transaction being herein called a "Transaction" and
-----------
the date of consummation of a Transaction being herein called a "Consummation
------------
Date"), then lawful and adequate provision shall be made so that upon the
- ----
exercise hereof at any time after the Consummation Date of such Transaction, the
Optionee shall be entitled to receive, in lieu of the Common Stock issuable
hereunder, the kind and amount of securities or other property to which he or
she would actually have been entitled as a stockholder of the Corporation upon
the consummation of such Transaction, if the Optionee had exercised his Options
immediately prior thereto. The provisions of this Section 9(b) shall similarly
apply to successive Transactions.
10. No Voting or Dividend Rights or Rights to Continued Employment.
--------------------------------------------------------------
Except as may be specifically provided in Section 9 hereof, nothing contained
herein shall be construed as conferring upon the Optionee the rights of a
stockholder of the Corporation in respect of the shares subject to the Options,
including without limitation, the right to vote as a stockholder, or to receive
any dividends paid or other distributions made to,
-4-
<PAGE>
stockholders. If Optionee is, or hereinafter becomes, an employee or director
of the Corporation or any subsidiary thereof, nothing contained in this
Agreement shall be deemed to confer upon Optionee any right to continued
employment with, or a continued officer or directorship position with, the
Corporation or any subsidiary thereof, nor shall it interfere in any way with
the right of the Corporation to terminate Optionee in accordance with the
provisions regarding such termination set forth in Optionee's written employment
agreement with the Corporation, or if there exists no such agreement, to
terminate Optionee at will, and/or terminate Optionee's directorship or officer
position in accordance with the Corporation's Certificate of Incorporation and
By-laws and/or applicable law, as the case may be.
11. Withholding Tax. Not later than the date as of which an amount
---------------
first must be included in the gross income of Optionee for Federal income tax
purposes with respect to the Options, Optionee may be required to pay the
Corporation, or make arrangements satisfactory to the Corporation regarding the
payment of, any Federal, state and local taxes of any kind required by law to be
withheld or paid with respect to such amount. The obligations of the
Corporation pursuant to this Agreement shall be conditional upon such payments
or arrangements with the Corporation, if such payments or arrangements are
required, and the Corporation shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to
Optionee from the Corporation.
12. Restrictions on Transferability; Legends.
----------------------------------------
(a) This Agreement, the Options granted hereby, the shares of Common
Stock issuable upon exercise thereof, and any other securities issuable pursuant
to Section 9 hereof (collectively, the "Securities") shall not be transferable
----------
by the Optionee without the prior written consent of the Corporation. No
transfer of the Options by Optionee by will or by the laws of descent and
distribution shall be effective to bind the Corporation unless the Corporation
shall have been furnished with written notice thereof and a copy of the will
and/or such other evidence as the Corporation may deem necessary to establish
the validity of the transfer and the acceptance by the transferee or transferees
of the terms and conditions of this Agreement and the Options.
(b) Anything in this Agreement to the contrary notwithstanding,
Optionee hereby agrees that Optionee shall not sell, transfer by any means or
otherwise dispose of the Securities without registration under the Securities
Act of 1933, as amended (the "1933 Act"), and compliance with state securities
--------
and Blue Sky laws, or in the event that they are not so registered, unless (i)
an exemption from the 1933 Act registration requirements is available
thereunder, and (ii) Optionee has furnished the Corporation with written notice
of such proposed transfer, and the Corporation's legal counsel, in
-5-
<PAGE>
its reasonable opinion, shall deem such proposed transfer to be so exempt.
(c) Anything in this Agreement to the contrary notwithstanding,
Optionee hereby agrees that Optionee shall not sell, transfer by any means or
otherwise dispose of the Securities, except in accordance with (i) the
Corporation's policy, if any, regarding the sale and disposition of securities
owned by employees, directors and/or officers of the Corporation, (ii) an
agreement among the stockholders of the Corporation in effect at the time of the
sale of the shares of Common Stock issuable upon exercise of the Options, or
(iii) if such an agreement set forth in clause (ii) above is not in effect, an
agreement among the stockholders of the Corporation reasonably acceptable to the
Corporation pursuant to which the stockholders of the Corporation may, among
other things, establish certain restrictions and rights to maintain continuity
of ownership and control of the Corporation.
(d) Each certificate representing the shares of Common Stock issuable
upon exercise of the Options shall be stamped or otherwise imprinted with the
legends in substantially the following forms:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS AND NEITHER THE SECURITIES NOR ANY INTEREST THEREIN
MAY BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF
EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT
OR SUCH LAWS OR AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT AND SUCH
LAWS, WHICH, IN THE OPINION OF COUNSEL FOR THE HOLDER, WHICH COUNSEL
AND OPINION ARE REASONABLY SATISFACTORY TO COUNSEL FOR THIS
CORPORATION, IS AVAILABLE.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED
PURSUANT TO AN OPTION AGREEMENT, DATED AS OF JULY 23, 1996, A COPY OF
WHICH IS ON FILE WITH THE CORPORATION, AND MAY NOT BE TRANSFERRED,
PLEDGED OR DISPOSED OF EXCEPT IN ACCORDANCE WITH THE TERMS AND
CONDITIONS THEREOF.
13. Representations and Warranties of the Corporation. The
-------------------------------------------------
Corporation hereby represents and warrants to, and agrees with, the Optionee
that as of the date hereof:
-6-
<PAGE>
(a) The Corporation is a Corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware.
(b) The Corporation has full corporate power and authority to execute
and deliver this Agreement, to perform its obligations hereunder and to carry
out the transactions contemplated hereby. All corporate acts and other
corporate proceedings required to be taken by or on the part of the Corporation
to authorize the Corporation to carry out this Agreement and the transactions
contemplated hereby have been duly and properly taken.
(c) The shares of Common Stock issuable upon exercise of the Options
have been duly authorized, and when such shares are issued to the Optionee in
accordance with this Agreement, such shares will be validly issued, fully paid
and non-assessable. The Corporation has reserved the required number of shares
of Common Stock for issuance upon exercise of the Options based on the number of
issued and outstanding shares of Common Stock on the date hereof and assuming
the exercise of all of the Options, and will, from time to time, reserve such
additional shares of Common Stock as may become issuable upon exercise of the
Options.
14. Representations and Warranties of the Optionee. The Optionee
----------------------------------------------
hereby represents and warrants to, and agrees with, the Corporation that as of
the date hereof:
(a) Optionee has the requisite legal capacity to execute and deliver
this Agreement, to perform its, his or her other obligations hereunder and to
carry out the transactions contemplated hereby.
(b) Optionee is acquiring and shall acquire the shares of Common Stock
issuable upon exercise of the Options, for Optionee's own account and not with a
view towards the distribution thereof in violation of applicable Federal and
state securities laws.
(c) Optionee acknowledges and agrees that (a) Optionee must bear the
economic risk of the investment in the shares of Common Stock issuable upon
exercise of the Options, which may not be sold by Optionee unless registered
under the 1933 Act or an exemption therefrom is available thereunder and (b) the
Corporation is under no obligation to register the Options or the shares of
Common Stock issuable upon exercise of the Options for sale under the 1933 Act.
(d) Optionee has had both the opportunity to ask questions and receive
answers from the officers and directors of the Corporation and all persons
acting on the Corporation's behalf concerning the terms and conditions of the
Options and this Agreement.
-7-
<PAGE>
(e) Optionee is aware that the Corporation shall place stop transfer
orders with its transfer agent against the transfer of the shares of Common
Stock issuable upon exercise of the Options in the absence of registration under
the 1933 Act or exemption therefrom as provided herein.
15. No Finders. Neither the Corporation nor the individual parties
----------
hereto have engaged any finder or broker in connection with the execution and
delivery of this Agreement.
16. Notices. Any notice or other communication to be given by any
-------
party hereunder to any other party shall be in writing, delivered personally,
mailed by certified or registered mail, return receipt requested, or sent by a
nationally recognized courier service, and shall be addressed to such party at
its address hereinabove stated or to such other address as may have been
furnished by any party to the other parties pursuant to this Section 16, and
shall be deemed to be given on the date of receipt.
17. Miscellaneous.
-------------
(a) Governing Law; Arbitration; Jurisdiction. This Agreement shall be
----------------------------------------
enforced, governed and construed in all respects in accordance with the laws of
the State of New York, without regard to its principles of conflicts of laws.
Any dispute arising hereunder shall be resolved by arbitration before the
American Arbitration Association in the City of New York, pursuant to the rules
of said body then obtaining; provided that any party may seek injunctive or
--------
other equitable relief pursuant to the terms hereof and for such purpose, the
parties hereto irrevocably submit to the exclusive personal jurisdiction of any
state or Federal court located in New York County. The parties irrevocably
waive, to the fullest extent permitted by law, any objection to which they may
now or hereafter have to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that any such suit, action or
proceeding has been brought in an inconvenient forum.
(b) Severability. If any provision of this Agreement is invalid or
------------
unenforceable under any applicable statute or rule of law, then such provision
shall be deemed inoperative to the extent that it may conflict therewith and
shall be deemed modified to conform with such statute or rule of law. Any
provision hereof that may prove invalid or unenforceable under any law shall not
affect the validity or enforceability of any other provision hereof.
(c) Entire Agreement. This Agreement constitutes the entire agreement
----------------
between the parties hereto with respect to the subject matter hereof and may be
amended only by a writing executed by both parties hereto.
-8-
<PAGE>
(d) Headings. The headings of this Agreement are for convenience only
--------
and shall not affect the meaning of the terms hereof.
(e) Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
(f) Waiver. The waiver by any party hereto of a breach of any
------
provision of this Agreement shall not operate or be construed as a waiver of any
other or subsequent breach.
[SIGNATURE PAGE TO FOLLOW]
-9-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
COINMACH LAUNDRY CORPORATION
By: /s/ ROBERT M. DOYLE
------------------------------
Name: ROBERT M. DOYLE
Title SENIOR VICE PRESIDENT
/s/ RUSSELL HARRISON
-----------------------------------
Russell Harrison
-10-
<PAGE>
EXHIBIT 14
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"), James N. Chapman (the
-------
"Purchaser") and Golder, Thoma, Cressey, Rauner Fund IV, L.P. ("GTCR").
--------- ----
The Company and the Purchaser desire to enter into an agreement
pursuant to which the Purchaser will purchase, and the Company will issue, 300
shares of the Company's Class A Common Stock, par value $0.01 per share (the
"Class A Common Stock"). Certain definitions are set forth in Section 5 of this
--------------------
Agreement.
Simultaneously with the execution of this Agreement, (i) each of Heller
Financial, Inc. ("Heller"), Jackson National Life Insurance Company ("Jackson")
------ -------
and Jackson National Life Insurance Company of Michigan ("Jackson Michigan" and,
----------------
together with Heller and Jackson, the "Lenders") are entering into investor
-------
purchase agreements (the "Other Investor Purchase Agreements") substantially
----------------------------------
similar to this Agreement pursuant to which Heller, Jackson and Jackson Michigan
will acquire shares of the Company's Class C Common Stock and (ii) each of the
President and Fellows of Harvard College ("Harvard"), MCS Capital, Inc. ("MCS"),
------- ---
MCS Capital Management, Inc. ("MCS Management"), Mitchell Blatt ("Blatt") and
-------------- -----
Michael E. Marrus ("Marrus") are entering into investor purchase agreements
------
substantially similar to this Agreement pursuant to which Harvard, MCS, MCS
Management, Blatt and Marrus will also acquire shares of the Company's Class A
Common Stock, par value $0.01 per share (the "Class A Common Stock"). The
--------------------
Heller, Jackson, Jackson Michigan, Harvard, Marrus, Blatt, MCS Management and
MCS investor purchase agreements are referred to herein as the "Other Investor
--------------
Purchase Agreements" and along with this Agreement as the "Investor Purchase
- ------------------- -----------------
Agreements."
- ----------
The execution and delivery of this Agreement by the Company and
Purchaser is a condition to the purchase of 72,516 shares of Class A Common
Stock by GTCR and certain shares of the Company's Class B Common Stock, par
value $0.01 per share (the "Class B Common Stock") by certain members of the
--------------------
Company's management pursuant to purchase agreements between the Company and
each of such Persons dated as of the date hereof (along with the Investor
Purchase Agreements, the "Purchase Agreements"). The Class A Common Stock,
-------------------
Class B Common Stock, Class C Common Stock
<PAGE>
and the Company's Class D Common Stock, par value $0.01 per share (the "Class D
-------
Common Stock"), are hereinafter collectively referred to as the "Common Stock".
- ------------ ------------
Certain provisions of this Agreement are intended for the benefit of, and will
be enforceable by, GTCR.
The parties hereto agree as follows:
Section 1. Authorization and Closing
-------------------------
1A. Authorization of the Stock. The Company shall authorize the
--------------------------
issuance to Purchaser of 300 shares of Class A Common Stock having the rights
set forth in Exhibit A attached hereto.
---------
1B. Purchase and Sale of Investor Stock. At the Closing (as defined in
-----------------------------------
Section 1C below), the Company shall sell to the Purchaser and, subject to the
terms and conditions set forth herein, the Purchaser shall purchase from the
Company 300 shares of the Class A Common at a price of $144.7964 per share.
lC. The Closing. The closing of the purchase and sale of the Stock
-----------
(the "Closing") shall take place at the offices of Kirkland & Ellis, 200 East
-------
Randolph Drive, Chicago, Illinois 60601 at 10:00 a.m. on January 31, 1995, or at
such other place or on such other date as may be mut(a)ually agreeable to the
Company and the Purchaser. At the Closing, the Company shall deliver to the
Purchaser stock certificates evidencing the Class A Common to be purchased by
the Purchaser, registered in the Purchaser's name, upon payment of the purchase
price thereof by a cashier's or certified check, or by wire transfer of
immediately available funds to such account as designated by the Company in the
amount of $43,438.91.
Section 2. Representations and Warranties.
-------------------------------
2A. Representations and Warranties of Purchaser. In connection with
-------------------------------------------
the issuance of the Investor Stock hereunder, Purchaser represents and warrants
to the Company that, in each case, as of the Closing:
(i) The Class A Common Stock to be acquired by Purchaser pursuant to
this Agreement will be acquired for Purchaser's own account and not with a
view to, or intention of, distribution thereof in violation of the
Securities Act, or
- 2 -
<PAGE>
any applicable state securities laws, and such Class A Common Stock will
not be disposed of in contravention of the Securities Act or any applicable
state securities laws.
(ii) Purchaser is able to bear the economic risk of its investment in
such Class A Common Stock for an indefinite period of time, and Purchaser
acknowledges that such Class A Common Stock has not been registered under
the Securities Act and, therefore, cannot be sold unless subsequently
registered under the Securities Act or an exemption from such registration
is available.
(iii) Purchaser has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of such Class A
Common Stock and has had full access to such other information concerning
the Company as it has requested.
(iv) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Purchaser,
enforceable in accordance with their terms, and the execution, delivery and
performance of this Agreement, the Stockholders Agreement and the
Registration Agreement by Purchaser does not and will not conflict with,
violate or cause a breach of any agreement, contract or instrument to which
Purchaser is a party or any law, rule, regulation, judgment, order or decree
to which Purchaser is subject.
2B. Representations and Warranties of the Company. In connection with
---------------------------------------------
the issuance of the Investor Stock hereunder, the Company represents to
Purchaser that, in each case, as of the Closing:
(i) Organization and Corporate Power. The Company is a corporation
--------------------------------
duly organized, validly existing and in good standing under the laws of
Delaware. The Company has all requisite corporate power and authority to
carry out the transactions contemplated by this Agreement, the Purchase
Agreements, the Stockholders Agreement and the Registration Agreement (the
"Investment Agreements"). The copies of the Company's Certificate of
----------------------
Incorporation and Bylaws which have been furnished to Purchaser's counsel
reflect all amendments
- 3 -
<PAGE>
made thereto at any time prior to the date of this Agreement and are correct
and complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately thereafter, the authorized
capital stock of the Company shall consist of 10,000 shares which will be
designated as Preferred Stock and 108,150 shares of Common Stock, of which
77,350 shares shall be designated as Class A Common Stock, 15,500 shares
shall be designated Class B Common Stock, 7650 shares shall be designated as
Class C Common Stock and 7650 shares shall be designated as Class D Common
Stock. As of the Closing, the Company shall not have outstanding any stock
or securities convertible or exchangeable for any shares of its capital
stock or containing any profit participation features, nor shall it have
outstanding any rights or options to subscribe for or to purchase its
capital stock or any stock or securities convertible into or exchangeable
for its capital stock or any stock appreciation rights or phantom stock
plans other than pursuant to and as contemplated by this Agreement, the
Purchase Agreements, the Stockholders Agreement and the Company's
Certificate of Incorporation. As of the Closing, the Company shall not be
subject to any obligation (contingent or otherwise) to repurchase or
otherwise acquire or retire any shares of its capital stock or any warrants,
options or other rights to acquire its capital stock, except pursuant to
this Agreement, the Stockholders Agreement and the Purchase Agreements. As
of the Closing, all of the outstanding shares of the Company's capital
stock shall be validly issued, fully paid and nonassessable.
(b) There are no statutory or contractual stockholders preemptive
rights or rights of refusal with respect to the issuance of the Common Stock
hereunder, except as provided herein and in the Stockholders Agreement. The
Company has not violated any applicable federal or state securities laws in
connection with the offer, sale or issuance of any of its capital stock, and
the offer, sale and issuance of the Common Stock pursuant
- 4 -
<PAGE>
to this Agreement do not and will not require registration under the
Securities Acts.
(iii) Conduct of Business; Liabilities. Other than in the course of the
--------------------------------
negotiation, execution and delivery of this Agreement, the Purchase
Agreements and the other agreements contemplated hereby and thereby, prior
to the Closing, the Company has not (i) conducted any business, (ii)
incurred any expenses, obligations or liabilities (whether accrued,
absolute, contingent, unliquidated or otherwise, whether or not known to the
Company and whether due or to become due and regardless of when asserted),
(iii) owned any assets, or (iv) entered into any contracts or agreements.
Section 3. Restrictions on Transfer.
------------------------
3A. Transfer of Investor Stock.
--------------------------
(i) Subject to the restrictions set forth in the remainder of this
Section 3, Investor Stock is transferable only pursuant to (a) a Public
Offering registered under the Securities Act, (b) Rule 144 or Rule 144A of
the Securities and Exchange Commission (or any similar rule or rules then in
force) if such rule or rules are available or (c) subject to the conditions
specified in Section 3A(ii) below, any other legally available means of
transfer.
(ii) In connection with the transfer of any Investor Stock (other than
a transfer described in Section 3A(i)(a) or (b) above), the holder thereof
shall deliver written notice to the Company describing in reasonable detail
the transfer or proposed transfer, together with an opinion of counsel which
(to the Company's reasonable satisfaction) is knowledgeable in securities
law matters to the effect that such transfer of Investor Stock may be
effected without registration of such Investor Stock under the Securities
Act. In addition, if the holder of the Investor Stock delivers to the
Company an opinion of counsel that no subsequent transfer of such Investor
Stock shall require registration under the Securities Act, the Company shall
promptly upon such contemplated transfer deliver new certificates for such
Investor Stock which do not bear the Securities Act legend set forth in
Section 4A hereof. If the Company is not required to deliver
- 5 -
<PAGE>
new certificates for such Investor Stock not bearing such legend, the holder
thereof shall not transfer the same until the prospective transferee has
confirmed to the Company in writing its agreement to be bound by the
conditions contained in this Section and Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company shall promptly
supply to the Purchaser or its prospective transferees all information
regarding the Company required to be delivered in connection with a transfer
pursuant to Rule 144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor Stock in
violation of any provision of this Agreement shall be void, and the Company
shall not record such transfer on its books or treat any purported
transferee of such Investor Stock as the owner of such Investor Stock for
any purpose.
3B. Sale Notice Prior to making any Transfer of Investor Stock,
Purchaser will give written notice (the "Sale Notice") to the Company and GTCR.
-----------
The Sale Notice will disclose in reasonable detail the number of shares to be
transferred and the terms and conditions of the proposed Transfer and, if known,
the identity of the prospective transferee(s). Purchaser will not consummate any
such Transfer until 60 days after the Sale Notice has been given to the Company
and to GTCR, unless the parties to the Transfer have been fully determined
pursuant to this Section 3B and Sections 3C and 3D prior to the expiration of
such 60-day period. (The date of the first to occur of such events is referred
to herein as the "Authorization Date.")
------------------
3C. First Refusal Rights. The Company may elect to purchase all (but
not less than all) of the shares of Investor Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Purchaser and GTCR within 30 days after the
Sale Notice has been given to the Company. If the Company has not elected to
purchase all of the Investor Stock to be transferred, GTCR may elect to purchase
all (but not less than all) of the Investor Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by giving
written notice of such election to Purchaser within 60 days after the Sale
Notice has been given to GTCR. If neither the Company nor GTCR elect to purchase
all of the
- 6 -
<PAGE>
shares of Investor Stock specified in the Sale Notice, Purchaser may transfer
the shares of Investor Stock specified in the Sale Notice at a price and on
terms no more favorable to the transferee(s) thereof than specified in the Sale
Notice during the 30-day period immediately following the Authorization Date.
Any shares of Investor Stock not transferred within such 30-day period will be
subject to the provisions of this Section 3C upon subsequent transfer.
3D. Co-Sale Rights.
---------------
(i) GTCR may elect to participate in the contemplated Transfer by
delivering written notice to Purchaser within 90 days after delivery of the
Sale Notice to GTCR. If GTCR has elected to participate in such Transfer,
Purchaser and GTCR shall be entitled to sell in the contemplated Transfer,
on the same terms and at the price calculated pursuant to subparagraph
3D(ii) below, a number of shares equal to the product of (x) the quotient
determined by dividing the number of shares of Common Stock owned by such
person by the aggregate number of shares of Common Stock owned by Purchaser
and GTCR and (y) the number of shares to be sold in the contemplated
Transfer.
For example, if the Sale Notice contemplated a sale of 100 shares by
-----------
Purchaser, and if Purchaser was at such time the owner of 30% of the
Company's Common Stock (on a fully-diluted basis) and if GTCR elected to
participate and GTCR owned 20% of the Company's Common Stock (on a fully-
diluted basis), Purchaser would be entitled to sell 60 shares (30% / 50% x
100 shares) and GTCR would be entitled to sell 40 shares (20% / 50% x 100
shares).
Purchaser will use its best efforts to obtain the agreement of the
prospective transferee(s) to the participation of GTCR in the contemplated
transfer and will not transfer any Investor Stock to the prospective
transferee(s) if such transferee(s) refuses to allow the participation of
GTCR.
(ii) The purchase price to be paid by any transferee for shares of
Class A Common transferred in accordance with this paragraph 3D shall be
equal to the amount per share of Class A Common which such transferee has
agreed to pay to Purchaser.
- 7 -
<PAGE>
Section 4. Additional Restrictions on Transfer of Investor Stock.
-----------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring the
------
Investor Stock purchased hereunder or acquired pursuant hereto for its own
account with the present intention of holding such securities for purposes of
investment, and that it has no intention of selling such securities in a public
distribution in violation of the federal securities laws or any applicable state
securities laws; provided that nothing contained herein shall prevent the
Purchaser and subsequent holders of Investor Stock from transferring such
securities in compliance with the provisions of Section 4 hereof. Each
certificate for Investor Stock shall be imprinted with a legend in substantially
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
AS OF JANUARY 31, 1995, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON
TRANSFER AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE
AGREEMENT BETWEEN THE COMPANY AND CERTAIN INVESTORS, DATED AS OF
JANUARY 31, 1995. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE
HOLDER HEREOF AT THE ISSUER'S PRINCIPAL PLACE OF BUSINESS WITHOUT
CHARGE."
4B. Opinion of Counsel. No holder of Investor Stock may sell, transfer
------------------
or dispose of any Investor Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that (i) neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer or
(ii) all such applicable registration and qualification requirements have been
satisfied.
- 8 -
<PAGE>
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class A Common issued hereunder and
--------------
(ii) any Common Stock issued or issuable with respect to the Common Stock
referred to in clause (i) above by way of stock dividends or stock splits or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization. As to any particular shares of Investor Stock, such
shares shall cease to be Investor Stock when they have been (a) effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them or (b) distributed to the public through a
broker, dealer or market maker pursuant to Rule 144 under the Securities Act (or
any similar rule then in force). Whenever any particular securities cease to be
Investor Stock, the holder thereof shall be entitled to receive from the
Company, without expense, new securities of like tenor not bearing a Securities
Act legend of the character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an
------
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof.
"Public Offering" means the sale in an underwritten public offering
----------------
registered under the Securities Act (other than on Form S-8 or a similar or
successor form) of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering
-----------
under the Securities Act or any sale to the public pursuant to Rule 144
promulgated under the Securities Act effected through a broker, dealer or market
maker.
"Registration Agreement" means the Registration Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Purchaser.
"Securities Act" means the Securities Act of 1933, as amended, or any
--------------
similar federal law then in force.
- 9 -
<PAGE>
"Securities Exchange Act" means the Securities Exchange Act of 1934,
-----------------------
as amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or
----------------------------------
agency succeeding to the functions thereof.
"Stockholders Agreement" means the Stockholders Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Purchaser.
"Transfer" means to sell, transfer, assign, pledge or otherwise
--------
dispose of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) other than pursuant to a Public Sale or
Sale of the Company.
Section 6. Miscellaneous
-------------
6A. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a Copy (which will not constitute notice to the Company) to:
----------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
-------------------
James N. Chapman
14 Alpine Road
Greenwich, CT 06830
- 10 -
<PAGE>
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attentions Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
6B. Transfers in Violation of Agreement. Any Transfer or attempted
-----------------------------------
Transfer of any Investor Stock in violation of any provision of this Agreement
shall be void, and the Company shall not record such Transfer on its books or
treat any purported transferee of such Investor Stock as the owner of such stock
for any purpose.
6C. Severability. Whenever possible, each provision of this Agreement
------------
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
6D. Complete Agreement. This Agreement, those documents expressly
-------------------
referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the
- 11 -
<PAGE>
parties and supersede and preempt any prior summaries of terms and conditions,
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.
6E. Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Purchaser and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Purchaser, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Purchaser's Stock);
provided that Purchaser may not assign any of its rights under any provision of
- --------
this Agreement except as part of a Transfer of Investor Stock in accordance with
Section 3.
6G. Choice of Law. The corporate law of the State of Delaware will
-------------
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and
construed in accordance with the internal laws of the State of Illinois, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have all rights and
--------
remedies set forth in this Agreement and the Certificate of Incorporation and
all rights and remedies which such holders have been granted at any time under
any other agreement or contract and all of the rights which such holders have
under any law. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically (without posting
a bond or other security), to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law.
- 12 -
<PAGE>
6I. Amendment and Waiver. Except as otherwise expressly provided
--------------------
herein, the provisions of this Agreement may be amended or modified only by
written agreement of the Company, Purchaser and GTCR. No other course of dealing
between the parties or third-party beneficiaries hereof or any delay in
exercising any rights hereunder shall operate as a waiver of any rights of any
such holders.
6J. Survival of Representations and Warranties. All representations
------------------------------------------
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Purchaser or on its behalf or by the Company or on its
behalf.
6K. Business Days. If any time period for giving notice or taking
-------------
action hereunder expires on a day which is a Saturday, Sunday or holiday in the
state in which the Company's chief executive office is located, the time period
shall be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
6L. Descriptive Headings; Interpretation. The descriptive headings of
------------------------------------
this Agreement are inserted for convenience only and do not constitute a Section
of this Agreement. The use of the word "including" in this Agreement shall be by
way of example rather than by limitation.
* * * * *
- 13 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE COINMACH CORPORATION
By /s/ ROBERT M. DOYLE
--------------------------------
Its Vice President
-------------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /s/ CARL D. THOMAS
----------------------------
Its: Principal
/s/ JAMES N. CHAPMAN
-----------------------------------
JAMES N. CHAPMAN
- 14 -
<PAGE>
EXHIBIT 15
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between
The Coinmach Corporation, a Delaware corporation (the "Company"),
-------
Michael E. Marrus (the "Purchaser") and Golder, Thoma, Cressey,
---------
Rauner Fund IV, L.P. ("GTCR").
----
The Company and the Purchaser desire to enter into an
agreement pursuant to which the Purchaser will purchase, and the
Company will issue, 231 shares of the Company's Class A Common
Stock, par value $0.01 per share (the "Class A Common Stock").
--------------------
Certain definitions are set forth in Section 5 of this Agreement.
Simultaneously with the execution of this Agreement,
(i) each of Heller Financial, Inc. ("Heller"), Jackson National
------
Life Insurance Company ("Jackson") and Jackson National Life
-------
Insurance Company of Michigan ("Jackson Michigan" and, together
-----------------
with Heller and Jackson, the "Lenders") are entering into investor
-------
purchase agreements (the "Other Investor Purchase Agreements")
----------------------------------
substantially similar to this Agreement pursuant to which Heller,
Jackson and Jackson Michigan will acquire shares of the Company's
Class C Common Stock and (ii) each of the President and Fellows of
Harvard College ("Harvard"), MCS Capital, Inc. ("MCS"), MCS Capital
------- ---
Management Capital, Inc. ("MCS Management"), Mitchell Blatt
--------------
("Blatt") and James N. Chapman ("Chapman") are entering into
----- -------
investor purchase agreements substantially similar to this
Agreement pursuant to which Harvard, MCS, MCS Managment, Blatt and
Chapman will also acquire shares of the Company's Class A Common
Stock, par value $0.01 per share (the "Class A Common Stock"). The
--------------------
Heller, Jackson, Jackson Michigan, Harvard, Chapman, Blatt, MCS
Management and MCS investor purchase agreements are referred to
herein as the "Other Investor Purchase Agreements" and along with
----------------------------------
this Agreement as the "Investor Purchase Agreements."
----------------------------
The execution and delivery of this Agreement by the
Company and Purchaser is a condition to the purchase of 72,516
shares of Class A Common Stock by GTCR and certain shares of the
Company's Class B Common Stock, par value $0.01 per share (the
"Class B Common Stock") by certain members of the Company's
--------------------
management pursuant to purchase agreements between the Company and
each of such Persons dated as of the date hereof (along with the
Investor Purchase Agreements, the "Purchase Agreements"). The
-------------------
<PAGE>
Class A Common Stock, Class B Common Stock, Class C Common Stock
and the Company's Class D Common Stock, par value $0.01 per share
(the "Class D Common Stock"), are hereinafter collectively
--------------------
referred to as the "Common Stock". Certain provisions of this
------------
Agreement are intended for the benefit of, and will be enforceable
by, GTCR.
The parties hereto agree as follows:
Section 1. Authorization and Closing.
-------------------------
1A. Authorization of the Stock. The Company shall
--------------------------
authorize the issuance to Purchaser of 231 shares of Class A
Common Stock having the rights set forth in Exhibit A attached
---------
hereto.
1B. Purchase and Sale of Investor Stock. At the Closing
-----------------------------------
(as defined in Section 1C below), the Company shall sell to the
Purchaser and, subject to the terms and conditions set forth
herein, the Purchaser shall purchase from the Company 231 shares
of the Class A Common at a price of $144.7964 per share.
1C. The Closing. The closing of the purchase and sale of
------------
the Stock (the "Closing") shall take place at the offices of
Kirkland & Ellis, 200 East Randolph Drive, Chicago, Illinois 60601
at 10:00 a.m. on January 31, 1995, or at such other place or on
such other date as may be mutually agreeable to the Company and
the Purchaser. At the Closing, the Company shall deliver to the
Purchaser stock certificates evidencing the Class A Common to be
purchased by the Purchaser, registered in the Purchaser's name,
upon payment of the purchase price thereof by a cashier's or
certified check, or by wire transfer of immediately available
funds to such account as designated by the Company in the amount
of $33,447.96
Section 2. Representations and Warranties.
------------------------------
2A. Representations and Warranties of Purchaser. In
-------------------------------------------
connection with the issuance of the Investor Stock hereunder,
Purchaser represents and warrants to the Company that, in each
case, as of the Closing:
(i) The Class A Common Stock to be acquired by Purchaser
pursuant to this Agreement will be acquired for Purchaser's
- 2 -
<PAGE>
own account and not with a view to, or intention of,
distribution thereof in violation of the Securities Act, or
any applicable state securities laws, and such Class A Common
Stock will not be disposed of in contravention of the
Securities Act or any applicable state securities laws.
(ii) Purchaser is able to bear the economic risk of its
investment in such Class A Common Stock for an indefinite
period of time, and Purchaser acknowledges that such Class A
Common Stock has not been registered under the Securities Act
and, therefore, cannot be sold unless subsequently registered
under the Securities Act or an exemption from such
registration is available.
(iii) Purchaser has had an opportunity to ask questions
and receive answers concerning the terms and conditions of the
offering of such Class A Common Stock and has had full access
to such other information concerning the Company as it has
requested.
(iv) This Agreement, the Stockholders Agreement and the
Registration Agreement constitute legal, valid and binding
obligations of Purchaser, enforceable in accordance with their
terms, and the execution, delivery and performance of this
Agreement, the Stockholders Agreement and the Registration
Agreement by Purchaser does not and will not conflict with,
violate or cause a breach of any agreement, contract or
instrument to which Purchaser is a party or any law, rule,
regulation, judgment, order or decree to which Purchaser is
subject.
2B. Representations and Warranties of the Company. In
----------------------------------------------
connection with the issuance of the Investor Stock hereunder, the
Company represents to Purchaser that, in each case, as of the Closing:
(i) Organization and Corporate Power. The Company is a
--------------------------------
corporation duly organized, validly existing and in good
standing under the laws of Delaware. The Company has all
requisite corporate power and authority to carry out the
transactions contemplated by this Agreement, the Purchase
Agreements, the Stockholders Agreement and the Registration
- 3 -
<PAGE>
Agreement (the "Investment Agreements"). The copies of the
---------------------
Company's Certificate of Incorporation and Bylaws which have
been furnished to Purchaser's counsel reflect all amendments
made thereto at any time prior to the date of this Agreement and
are correct and complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately thereafter, the
authorized capital stock of the Company shall consist of
10,000 shares which will be designated as Preferred Stock
and 108,150 shares of Common Stock, of which 77,350 shares
shall be designated as Class A Common Stock, 15,500 shares
shall be designated Class B Common Stock, 7650 shares shall
be designated as Class C Common Stock and 7650 shares shall
be designated as Class D Common Stock. As of the Closing,
the Company shall not have outstanding any stock or
securities convertible or exchangeable for any shares of
its capital stock or containing any profit participation
features, nor shall it have outstanding any rights or
options to subscribe for or to purchase its capital stock
or any stock or securities convertible into or exchangeable
for its capital stock or any stock appreciation rights or
phantom stock plans other than pursuant to and as
contemplated by this Agreement, the Purchase Agreements,
the Stockholders Agreement and the Company's Certificate of
Incorporation. As of the Closing, the Company shall not be
subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of its
capital stock or any warrants, options or other rights to
acquire its capital stock, except pursuant to this
Agreement, the Stockholders Agreement and the Purchase
Agreements. As of the Closing, all of the outstanding
shares of the Company's capital stock shall be validly
issued, fully paid and nonassessable.
(b) There are no statutory or contractual
stockholders preemptive rights or rights of refusal with
respect to the issuance of the Common Stock hereunder,
except as provided herein and in the Stockholders
Agreement. The Company has not violated any applicable
<PAGE>
federal or state securities laws in connection with the
offer, sale or issuance of any of its capital stock, and
the offer, sale and issuance of the Common Stock
pursuant to this Agreement do not and will not require
registration under the Securities Act.
(iii) Conduct of Business: Liabilities. Other than in
--------------------------------
the course of the negotiation, execution and delivery of this
Agreement, the Purchase Agreements and the other agreements
contemplated hereby and thereby, prior to the Closing, the
Company has not (i) conducted any business, (ii) incurred any
expenses, obligations or liabilities (whether accrued,
absolute, contingent, unliquidated or otherwise, whether or
not known to the Company and whether due or to become due and
regardless of when asserted), (iii) owned any assets, or (iv)
entered into any contracts or agreements.
Section 3. Restrictions on Transfer.
------------------------
3A. Transfer of Investor Stock.
--------------------------
(i) Subject to the restrictions set forth in the
remainder of this Section 3, Investor Stock is transferable
only pursuant to (a) a Public Offering registered under the
Securities Act, (b) Rule 144 or Rule 144A of the Securities
and Exchange Commission (or any similar rule or rules then in
force) if such rule or rules are available or (c) subject to
the conditions specified in Section 3A(ii) below, any other
legally available means of transfer.
(ii) In connection with the transfer of any Investor
Stock (other than a transfer described in Section 3A(i)(a) or
(b) above), the holder thereof shall deliver written notice to
the Company describing in reasonable detail the transfer or
proposed transfer, together with an opinion of counsel which
(to the Company's reasonable satisfaction) is knowledgeable in
securities law matters to the effect that such transfer of
Investor Stock may be effected without registration of such
Investor Stock under the Securities Act. In addition, if the
holder of the Investor Stock delivers to the Company an
opinion of counsel that no subsequent transfer of such
Investor Stock shall require registration under the Securities
- 5 -
<PAGE>
Act, the Company shall promptly upon such contemplated
transfer deliver new certificates for such Investor Stock
which do not bear the Securities Act legend set forth in
Section 4A hereof. If the Company is not required to deliver
new certificates for such Investor Stock not bearing such
legend, the holder thereof shall not transfer the same until
the prospective transferee has confirmed to the Company in
writing its agreement to be bound by the conditions contained
in this Section and Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company
shall promptly supply to the Purchaser or its prospective
transferees all information regarding the Company required to
be delivered in connection with a transfer pursuant to Rule
144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor
Stock in violation of any provision of this Agreement shall be
void, and the Company shall not record such transfer on its
books or treat any purported transferee of such Investor Stock
as the owner of such Investor Stock for any purpose.
3B. Sale Notice Prior to making any Transfer of Investor
-----------
Stock, Purchaser will give written notice (the "Sale Notice") to
-----------
the Company and GTCR. The Sale Notice will disclose in reasonable
detail the number of shares to be transferred and the terms and
conditions of the proposed Transfer and, if known, the identity of
the prospective transferee(s). Purchaser will not consummate any
such Transfer until 60 days after the Sale Notice has been given to
the Company and to GTCR, unless the parties to the Transfer have
been fully determined pursuant to this Section 3B and Sections 3C
and 3D prior to the expiration of such 60-day period. (The date of
the first to occur of such events is referred to herein as the
"Authorization Date.")
------------------
3C. First Refusal Rights. The Company may elect to
--------------------
purchase all (but not less than all) of the shares of Investor
Stock to be transferred upon the same terms and conditions as those
set forth in the Sale Notice by delivering a written notice of such
election to Purchaser and GTCR within 30 days after the Sale Notice
has been given to the Company. If the Company has not elected to
purchase all of the Investor Stock to be transferred, GTCR may
- 6 -
<PAGE>
elect to purchase all (but not less than all) of the Investor Stock to
be transferred upon the same terms and conditions as those set forth in
the Sale Notice by giving written notice of such election to Purchaser
within 60 days after the Sale Notice has been given to GTCR. If neither
the Company nor GTCR elect to purchase all of the shares of Investor
Stock specified in the Sale Notice, Purchaser may transfer the shares
of Investor Stock specified in the Sale Notice at a price and on terms
no more favorable to the transferee(s) thereof than specified in the
Sale Notice during the 30-day period immediately following the
Authorization Date. Any shares of Investor Stock not transferred within
such 30-day period will be subject to the provisions of this Section 3C
upon subsequent transfer.
3D. Co-Sale Rights.
---------------
(i) GTCR may elect to participate in the contemplated
Transfer by delivering written notice to Purchaser within 90
days after delivery of the Sale Notice to GTCR. If GTCR has
elected to participate in such Transfer, Purchaser and GTCR
shall be entitled to sell in the contemplated Transfer, on the
same terms and at the price calculated pursuant to sub-
paragraph 3D(ii) below, a number of shares equal to the
product of (x) the quotient determined by dividing the number
of shares of Common Stock owned by such person by the
aggregate number of shares of Common Stock owned by Purchaser
and GTCR and (y) the number of shares to be sold in the
contemplated Transfer.
For example, if the Sale Notice contemplated a sale of
-----------
100 shares by Purchaser, and if Purchaser was at such time the
owner of 30% of the Company's Common Stock (on a fully-diluted
basis) and if GTCR elected to participate and GTCR owned 20%
of the Company's Common Stock (on a fully-diluted basis),
Purchaser would be entitled to sell 60 shares (30% / 50% x 100
shares) and GTCR would be entitled to sell 40 shares (20% /
50% x 100 shares).
Purchaser will use its best efforts to obtain the agreement of
the prospective transferee(s) to the participation of GTCR in
the contemplated transfer and will not transfer any Investor
- 7 -
<PAGE>
Stock to the prospective transferee(s) if such transferee(s) refuses to
allow the participation of GTCR.
(ii) The purchase price to be paid by any transferee for shares of
Class A Common transferred in accordance with this paragraph 3D shall be
equal to the amount per share of Class A Common which such transferee has
agreed to pay to Purchaser.
Section 4. Additional Restrictions on Transfer of Investor Stock.
-----------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring the
------
Investor Stock purchased hereunder or acquired pursuant hereto for its own
account with the present intention of holding such securities for purposes of
investment, and that it has no intention of selling such securities in a public
distribution in violation of the federal securities laws or any applicable state
securities laws; provided that nothing contained herein shall prevent the
Purchaser and subsequent holders of Investor Stock from transferring such
securities in compliance with the provisions of Section 4 hereof. Each
certificate for Investor Stock shall be imprinted with a legend in substantially
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
AS OF JANUARY 31, 1995, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON
TRANSFER AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE
AGREEMENT BETWEEN THE COMPANY AND CERTAIN INVESTORS, DATED AS OF
JANUARY 31, 1995. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE
HOLDER HEREOF AT THE ISSUER'S PRINCIPAL PLACE OF BUSINESS WITHOUT
CHARGE."
- 8 -
<PAGE>
4B. Opinion of Counsel. No holder of Investor Stock may sell, transfer
------------------
or dispose of any Investor Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that (i) neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer or
(ii) all such applicable registration and qualification requirements have been
satisfied.
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class A Common issued hereunder and
--------------
(ii) any Common Stock issued or issuable with respect to the Common Stock
referred to in clause (i) above by way of stock dividends or stock splits or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization. As to any particular shares of Investor Stock, such
shares shall cease to be Investor Stock when they have been (a) effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them or (b) distributed to the public through a
broker, dealer or market maker pursuant to Rule 144 under the Securities Act (or
any similar rule then in force). Whenever any particular securities cease to be
Investor Stock, the holder thereof shall be entitled to receive from the
Company, without expense, new securities of like tenor not bearing a Securities
Act legend of the character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an
------
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof.
"Public Offering" means the sale in an underwritten public offering
---------------
registered under the Securities Act (other than on Form S-8 or a similar or
successor form) of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering
-----------
under the Securities Act or any sale to the public
- 9 -
<PAGE>
pursuant to Rule 144 promulgated under the Securities Act effected
through a broker, dealer or market maker.
"Registration Agreement" means the Registration Agreement
-----------------------
dated as of the date hereof among the Company, the Investors (as
defined in that Agreement) and Purchaser.
"Securities Act" means the Securities Act of 1933, as
--------------
amended, or any similar federal law then in force.
"Securities Exchange Act" means the Securities Exchange
-----------------------
Act of 1934, as amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any
----------------------------------
governmental body or agency succeeding to the functions thereof.
"Stockholders Agreement" means the Stockholders Agreement
----------------------
dated as of the date hereof among the Company, the Investors (as
defined in that Agreement) and Purchaser.
"Transfer" means to sell, transfer, assign, pledge or
--------
otherwise dispose of (whether with or without consideration and
whether voluntarily or involuntarily or by operation of law) other
than pursuant to a Public Sale or Sale of the Company.
Section 6. Miscellaneous.
-------------
6A. Notices. Any notice provided for in this Agreement
-------
must be in writing and must be either personally delivered, mailed
by first class mail (postage prepaid and return receipt requested)
or sent by reputable overnight courier service (charges prepaid) to
each person at the address set forth below:
If to the Company:
------------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
- 10 -
<PAGE>
With a copy (which will not constitute notice to the
----------------------------------------------------
Company) to:
-----------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
-------------------
Michael E. Marrus
755 Park Avenue
New York, New York 10021
With a copy (which will not constitute notice to
------------------------------------------------
Purchaser) to:
-------------
Katten Muchin & Zavis
525 West Monroe Street, Suite 1600
Chicago, IL 60661
Attention: Stuart P. Shulruff, Esq.
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to
------------------------------------------------
GTRC) to:
--------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as
the recipient party shall have specified by prior written notice to
the sending party. Any notice under this Agreement will be deemed
- 11 -
<PAGE>
to have been given when so delivered or sent or, if mailed, five days
after deposit in the U.S. mail.
6B. Transfers in Violation of Agreement. Any Transfer or
-----------------------------------
attempted Transfer of any Investor Stock in violation of any provision
of this Agreement shall be void, and the Company shall not record such
Transfer on its books or treat any purported transferee of such
Investor Stock as the owner of such stock for any purpose.
6C. Severability. Whenever possible, each provision of this
------------
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement is
held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision or
any other jurisdiction, but this Agreement will be reformed, construed
and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.
6D. Complete Agreement. This Agreement, those documents
-------------------
expressly referred to herein and other documents of even date herewith
embody the complete agreement and understanding among the parties and
supersede and preempt any prior summaries of terms and conditions,
understandings, agreements or representations by or among the parties,
written or oral, which may have related to the subject matter hereof
in any way.
6E. Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of
which taken together constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided
-----------------------
herein, this Agreement shall bind Purchaser and the Company and their
respective successors and permitted assigns and inure to the benefit
of and be enforceable by Purchaser, the Company, GTCR and their
respective successors and permitted assigns (including in each case
subsequent holders of Purchaser's Stock); provided that Purchaser may
--------
not assign any of its rights under any provision of
- 12 -
<PAGE>
this Agreement except as part of a Transfer of Investor Stock in
accordance with Section 3.
6G. Choice of Law. The corporate law of the State of
-------------
Delaware will govern all questions concerning the relative rights
of the Company and its stockholders. All other questions con-
cerning the construction, validity and interpretation of this
Agreement and the exhibits hereto will be governed by and construed
in accordance with the internal laws of the State of Illinois,
without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have
--------
all rights and remedies set forth in this Agreement and the
Certificate of Incorporation and all rights and remedies which such
holders have been granted at any time under any other agreement or
contract and all of the rights which such holders have under any
law. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically
(without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law.
6I. Amendment and Waiver. Except as otherwise expressly
--------------------
provided herein, the provisions of this Agreement may be amended or
modified only by written agreement of the Company, Purchaser and
GTCR. No other course of dealing between the parties or third-party
beneficiaries hereof or any delay in exercising any rights
hereunder shall operate as a waiver of any rights of any such
holders.
6J. Survival of Representations and Warranties. All
------------------------------------------
representations and warranties contained herein or made in writing
by any party in connection herewith shall survive the execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby, regardless of any investigation made by
Purchaser or on its behalf or by the Company or on its behalf.
6K. Business Days. If any time period for giving notice
-------------
or taking action hereunder expires on a day which is a Saturday,
- 13 -
<PAGE>
Sunday or holiday in the state in which the Company's chief
executive office is located, the time period shall be automatically
extended to the business day immediately following such Saturday,
Sunday or holiday.
6L. Descriptive Headings: Interpretation. The descriptive
------------------------------------
headings of this Agreement are inserted for convenience only and do
not constitute a Section of this Agreement. The use of the word
"including" in this Agreement shall be by way of example rather than
by limitation.
* * * * *
- 14 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE COINMACH CORPORATION
By /s/ STEPHEN R. KERRIGAN
-----------------------------
Its Chief Executive Officer
----------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /s/ CARL D. THOMAS
---------------------------
Its: Principal
/s/ MICHAEL E. MARRUS
---------------------------------
Michael E. Marrus
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE COINMACH CORPORATION
By
-------------------------------
Its
------------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
BY: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By:
-----------------------------
Its: Principal
/s/ Michael B. Marrus
----------------------------------
Michael B. Marrus
<PAGE>
EXHIBIT 16
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"), MCS Capital, Inc. (the
-------
"Purchaser"), Stephen R. Kerrigan ( "Kerrigan" ) and Golder, Thoma, Cressey,
---------- --------
Rauner Fund IV, L.P. ("GTCR").
----
The Company and the Purchaser desire to enter into an agreement pursuant
to which the Purchaser will purchase, and the Company will issue, 268 shares of
the Company's Class A Common Stock, par value $0.01 per share (the "Class A
-------
Common Stock"). Certain definitions are set forth in Section 5 of this
- ------------
Agreement.
Simultaneously with the execution of this Agreement, (i) each of Heller
Financial, Inc. ("Heller"), Jackson National Life Insurance Company ("Jackson")
------ -------
and Jackson National Life Insurance Company of Michigan ("Jackson Michigan" and,
----------------
together with Heller and Jackson, the "Lenders") are entering into investor
-------
purchase agreements (the "Other Investor Purchase Agreements") substantially
----------------------------------
similar to this Agreement pursuant to which Heller, Jackson and Jackson Michigan
will acquire shares of the Company's Class C Common Stock and (ii) each of the
President and Fellows of Harvard College ("Harvard"), MCS Capital Management,
-------
Inc. ("MCS Management"), James N. Chapman ("Chapman"), Mitchell Blatt ("Blatt")
-------------- ------- -----
and Michael E. Marrus ("Marrus") are entering into investor purchase agreements
------
substantially similar to this Agreement pursuant to which Harvard, MCS
Management, Chapman, Blatt and Marrus will also acquire shares of the Company's
Class A Common Stock, par value $0.01 per share (the "Class A Common Stock").
--------------------
The Heller, Jackson, Jackson Michigan, MCS Management, Blatt, Harvard, Chapman
and Marrus investor purchase agreements are referred to herein as the "Other
-----
Investor Purchase Agreements" and along with this Agreement as the "Investor
- ---------------------------- --------
Purchase Agreements."
- -------------------
The execution and delivery of this Agreement by the Company and
Purchaser is a condition to the purchase of 72,516 shares of Class A Common
Stock by GTCR and certain shares of the Company's Class B Common Stock, par
value $0.01 per share (the "Class B Common Stock") by certain members of
--------------------
the Company's management pursuant to purchase agreements between the Company
and each of such Persons dated as of the date hereof (along with the Investor
Purchase Agreements, the "Purchase Agreements"). The
-------------------
<PAGE>
Class A Common Stock, Class B Common Stock, Class C Common Stock and the
Company's Class D Common Stock, par value $0.01 per share (the "Class D Common
--------------
Stock"), are hereinafter collectively referred to as the "Common Stock". Certain
- ----- ------------
provisions of this Agreement are intended for the benefit of, and will be
enforceable by, GTCR.
The parties hereto agree as follows:
Section 1. Authorization and Closing
-------------------------
1A. Authorization of the Stock. The Company shall authorize the issuance
--------------------------
to Purchaser of 268 shares of Class A Common Stock having the rights set forth
in Exhibit A attached hereto.
---------
1B. Purchase and Sale of Investor Stock. At the Closing (as defined in
-----------------------------------
Section 1C below), the Company shall sell to the Purchaser and, subject to the
terms and conditions set forth herein, the Purchaser shall purchase from the
Company 268 shares of the Class A Common at a price of $144.7964 per share.
1C. The Closing. The closing of the purchase and sale of the Stock
-----------
(the "Closing") shall take place at the offices of Kirkland & Ellis, 200 East
-------
Randolph Drive, Chicago, Illinois 60601 R at 10:00 a.m. on January 31, 1995, or
at such other place or on such other date as may be mutually agreeable to the
Company and the Purchaser. At the Closing, the Company shall deliver to the
Purchaser stock certificates evidencing the Class A Common to be purchased by
the Purchaser, registered in the Purchaser's name, upon payment of the purchase
price thereof by a cashier's or certified check, or by wire transfer of
immediately available funds to such account as designated by the Company in the
amount of $38,805.43.
Section 2. Representations and Warranties.
------------------------------
2A. Representations and Warranties of Purchaser. In connection with the
-------------------------------------------
issuance of the Investor Stock hereunder, Purchaser and Kerrigan represent and
warrant to the Company that, in each case, as of the Closing:
(i) The Class A Common Stock to be acquired by Purchaser pursuant to
this Agreement will be acquired for Purchaser's own account and not with a
view to, or intention of,
- 2 -
<PAGE>
distribution thereof in violation of the Securities Act, or any applicable
state securities laws, and such Class A Common Stock will not be disposed of
in contravention of the Securities Act or any applicable state securities
laws.
(ii) Kerrigan and Maureen W. Kerrigan ("Spouse") are the sole
------
shareholders of MCS, with Kerrigan owning of record and beneficially 200
shares of common stock owning of record and beneficially 200 shares of
commom, each free and clear of all liens, claims, charges, encumbrances,
voting agreements or restrictions of any kind. There are no options,
warrants, convertible securities or rights to acquire shares of MCS
outstanding and there are no agreements or arrangements to issue any of
the foregoing. MCS has conducted no business other than holding investment
securities and has no material liabilities.
(iii) Purchaser is able to bear the economic risk of its investment in
such Class A Common Stock for an indefinite period of time, and Purchaser
acknowledges that such Class A Common Stock has not been registered under
the Securities Act and, therefore, cannot be sold unless subsequently
registered under the Securities Act or an exemption from such registration
is available.
(iv) Purchaser has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of such Class A
Common Stock and has had full access to such other information concerning
the Company as it has requested.
(v) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Purchaser or
Kerrigan, as the case may be, enforceable in accordance with their terms,
and the execution, delivery and performance of this Agreement, the
Stockholders Agreement and the Registration Agreement by Purchaser or
Kerrigan, as the case may be, does not and will not conflict with, violate
or cause a breach of any agreement, contract or instrument to which
Purchaser or Kerrigan is a party or any law, rule, regulation, judgment,
order or decree to which Purchaser is subject.
- 3 -
<PAGE>
2B. Representations and Warranties of the Company. In connection with
---------------------------------------------
the issuance of the Investor Stock hereunder, the Company represents to
Purchaser that, in each case as of the Closing:
(i) Organization and Corporate Power. The Company is a corporation duly
--------------------------------
organized, validly existing and in good standing under the laws of Delaware.
The Company has all requisite corporate power and authority to carry out the
transactions contemplated by this Agreement, the Purchase Agreements, the
Stockholders Agreement and the Registration Agreement (the "Investment
----------
Agreements"). The copies of the Company's Certificate of Incorporation and
----------
Bylaws which have been furnished to Purchaser's counsel reflect all
amendments made thereto at any time prior to the date of this Agreement and
are correct and complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately thereafter, the authorized
capital stock of the Company shall consist of 10,000 shares which will
be designated as Preferred Stock and 108,150 shares of Common Stock, of
which 77,350 shares shall be designated as Class A Common Stock, 15,500
shares shall be designated Class B Common Stock, 7650 shares shall be
designated as Class C Common Stock and 7650 shares shall be designated
as Class D Common Stock. As of the Closing, the Company shall not have
outstanding any stock or securities convertible or exchangeable for any
shares of its capital stock or containing any profit participation
features, nor shall it have outstanding any rights or options to
subscribe for or to purchase its capital stock or any stock or
securities convertible into or exchangeable for its capital stock or any
stock appreciation rights or phantom stock plans other than pursuant to
and as contemplated by this Agreement, the Purchase Agreements, the
Stockholders Agreement and the Company's Certificate of Incorporation.
As of the Closing, the Company shall not be subject to any obligation
(contingent or otherwise) to repurchase or otherwise acquire or retire
any shares of its capital stock or any warrants, options or other rights
to acquire its capital stock, except pursuant to this Agreement, the
- 4 -
<PAGE>
Stockholders Agreement and the Purchase Agreements. As of the Closing,
all of the outstanding shares of the Company's capital stock shall be
validly issued, fully paid and nonassessable.
(b) There are no statutory or contractual stockholders preemptive
rights or rights of refusal with respect to the issuance of the Common
Stock hereunder, except as provided herein and in the Stockholders
Agreement. The Company has not violated any applicable federal or state
securities laws in connection with the offer, sale or issuance of any of
its capital stock, and the offer, sale and issuance of the Common Stock
pursuant to this Agreement do not and will not require registration
under the Securities Act.
(iii) Conduct of Business; Liabilities. Other than in the course of the
--------------------------------
negotiation, execution and delivery of this Agreement, the Purchase
Agreements and the other agreements contemplated hereby and thereby, prior
to the Closing, the Company has not (i) conducted any business, (ii)
incurred any expenses, obligations or liabilities (whether accrued,
absolute, contingent, unliquidated or otherwise, whether or not known to the
Company and whether due or to become due and regardless of when asserted),
(iii) owned any assets, or (iv) entered into any contracts or agreements.
Section 3. Restrictions on Transfer.
------------------------
3A. Transfer of Investor Stock.
--------------------------
(i) Subject to the restrictions set forth in the remainder of this
Section 3, Investor Stock is transferable only pursuant to (a) a Public
Offering registered under the Securities Act, (b) Rule 144 or Rule 144A of
the Securities and Exchange Commission (or any similar rule or rules then in
force) if such rule or rules are available or (c) subject to the conditions
specified in Section 3A(ii) below, any other legally available means of
transfer.
(ii) In connection with the transfer of any Investor Stock (other than a
transfer described in Section 3A(i)(a) or (b) above), the holder thereof
shall deliver written notice to
- 5 -
<PAGE>
the Company describing in reasonable detail the transfer or proposed
transfer, together with an opinion of counsel which (to the Company's
reasonable satisfaction) is knowledgeable in securities law matters to the
effect that such transfer of Investor Stock may be effected without
registration of such Investor Stock under the Securities Act. In addition,
if the holder of the Investor Stock delivers to the Company an opinion of
counsel that no subsequent transfer of such Investor Stock shall require
registration under the Securities Act, the Company shall promptly upon such
contemplated transfer deliver new certificates for such Investor Stock which
do not bear the Securities Act legend set forth in Section 4A hereof. If the
Company is not required to deliver new certificates for such Investor Stock
not bearing such legend, the holder thereof shall not transfer the same
until the prospective transferee has confirmed to the Company in writing its
agreement to be bound by the conditions contained in this Section and
Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company shall promptly
supply to the Purchaser or its prospective transferees all information
regarding the Company required to be delivered in connection with a transfer
pursuant to Rule 144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor Stock in
violation of any provision of this Agreement shall be void, and the Company
shall not record such transfer on its books or treat any purported
transferee of such Investor Stock as the owner of such Investor Stock for
any purpose.
3B. Sale Notice. Prior to making any direct or indirect Transfer of
-----------
Investor Stock, including but not limited to, by transfer of any interest in any
of the Purchaser's securities, Purchaser will give written notice (the "Sale
----
Notice") to the Company and GTCR. The Sale Notice will disclose in reasonable
- ------
detail the number of shares to be transferred and the terms and conditions of
the proposed Transfer and, if known, the identity of the prospective
transferee(s). Purchaser will not consummate any such Transfer until 60 days
after the Sale Notice has been given to the Company and to GTCR, unless the
parties to the Transfer have been fully determined pursuant to this Section 3B
and Sections 3C and 3D prior to the expiration of such 60-day period. (The date
of
- 6 -
<PAGE>
the first to occur of such events is referred to herein as the "Authorization
-------------
Date.")
- ----
3C. First Refusal Rights. The Company may elect to purchase all (but not
--------------------
less than all) of the shares of Investor Stock to be transferred upon the same
terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Purchaser and GTCR within 30 days after the
Sale Notice has been given to the Company. If the Company has not elected to
purchase all of the Investor Stock to be transferred, GTCR may elect to purchase
all (but not less than all) of the Investor Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by giving
written notice of such election to Purchaser within 60 days after the Sale
Notice has been given to GTCR. If neither the Company nor GTCR elect to purchase
all of the shares of Investor Stock specified in the Sale Notice, Purchaser may
transfer the shares of Investor Stock specified in the Sale Notice at a price
and on terms no more favorable to the transferee(s) thereof than specified in
the Sale Notice during the 30-day period immediately following the Authorization
Date. Any shares of Investor Stock not transferred within such 30-day period
will be subject to the provisions of this Section 3C upon subsequent transfer.
3D. Co-Sale Rights.
---------------
(i) GTCR may elect to participate in the contemplated Transfer by
delivering written notice to Purchaser within 90 days after delivery of the
Sale Notice to GTCR. If GTCR has elected to participate in such Transfer,
Purchaser and GTCR shall be entitled to sell in the contemplated Transfer,
on the same terms and at the price calculated pursuant to sub-paragraph
3D(ii) below, a number of shares equal to the product of (x) the quotient
determined by dividing the number of shares of Common Stock owned by such
person by the aggregate number of shares of Common Stock owned by Purchaser
and GTCR and (y) the number of shares to be sold in the contemplated
Transfer.
For example, if the Sale Notice contemplated a sale of 100 shares by
-----------
Purchaser, and if Purchaser was at such time the owner of 30% of the
Company's Common Stock (on a fully-diluted basis) and if GTCR elected to
participate and GTCR owned 20%
- 7 -
<PAGE>
of the Company's Common Stock (on a fully-diluted basis), Purchaser would be
entitled to sell 60 shares (30% / 50% x 100 shares) and GTCR would be
entitled to sell 40 shares (20% / 50% x 100 shares).
Purchaser will use its best efforts to obtain the agreement of the
prospective transferee(s) to the participation of GTCR in the contemplated
transfer and will not transfer any Investor Stock to the prospective
transferee(s) if such transferee(s) refuses to allow the participation of
GTCR.
(ii) The purchase price to be paid by any transferee for shares of Class
A Common transferred in accordance with this paragraph 3D shall be equal
to the amount per share of Class A Common which such transferee has agreed
to pay to Purchaser.
Section 4. Additional Restrictions on Transfer of Investor Stock.
-----------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring the
------
Investor Stock purchased hereunder or acquired pursuant hereto for its own
account with the present intention of holding such securities for purposes of
investment, and that it has no intention of selling such securities in a public
distribution in violation of the federal securities laws or any applicable state
securities laws; provided that nothing contained herein shall prevent the
Purchaser and subsequent holders of Investor Stock from transferring such
securities in compliance with the provisions of Section 4 hereof. Each
certificate for Investor Stock shall be imprinted with a legend in substantially
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
AS OF JANUARY 31, 1995, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON
TRANSFER AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE
AGREEMENT BETWEEN THE
- 8 -
<PAGE>
COMPANY AND CERTAIN INVESTORS, DATED AS OF JANUARY 31, 1995. A COPY OF
SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S
PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE."
4B. Opinion of Counsel. No holder of Investor Stock may sell, transfer
------------------
or dispose of any Investor Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that (i) neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer or
(ii) all such applicable registration and qualification requirements have been
satisfied.
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class A Common issued hereunder and (ii)
--------------
any Common Stock issued or issuable with respect to the Common Stock referred to
in clause (i) above by way of stock dividends or stock splits or in connection
with a combination of shares, recapitalization, merger, consolidation or other
reorganization. As to any particular shares of Investor Stock, such shares shall
cease to be Investor Stock when they have been (a) effectively registered under
the Securities Act and disposed of in accordance with the registration statement
covering them or (b) distributed to the public through a broker, dealer or
market maker pursuant to Rule 144 under the Securities Act (or any similar rule
then in force). Whenever any particular securities cease to be Investor Stock,
the holder thereof shall be entitled to receive from the Company, without
expense, new securities of like tenor not bearing a Securities Act legend of the
character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an
------
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof.
"Public Offering" means the sale in an underwritten public offering
---------------
registered under the Securities Act (other than on
- 9 -
<PAGE>
Form S-8 or a similar or successor form) of shares of the Company's Common Stock
approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering
-----------
under the Securities Act or any sale to the public pursuant to Rule 144
promulgated under the Securities Act effected through a broker, dealer or market
maker.
"Registration Agreement" means the Registration Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Purchaser.
"Securities Act" means the Securities Act of 1933, as amended, or any
--------------
similar federal law then in force.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
-----------------------
amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or
----------------------------------
agency succeeding to the functions thereof.
"Stockholders Agreement" means the Stockholders Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Purchaser.
"Transfer" means to sell, transfer, assign, pledge or otherwise dispose
--------
of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) other than pursuant to a Public Sale or
Sale of the Company.
Section 6. Miscellaneous
-------------
6A. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
- 10 -
<PAGE>
If-to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a copy (which will constitute notice to the
------------------------------------------------
Company) to:
-----------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
-------------------
MCS Capital, Inc.
c/o The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: Stephen R. Kerrigan
With a copy (which will not constitute notice to
------------------------------------------------
Purchaser) to:
-------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
- 11 -
<PAGE>
with a copy (which will not constitute notice to
------------------------------------------------
GTCR) to:
--------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
6B. Transfers in Violation of Agreement. Any Transfer or attempted
-----------------------------------
Transfer of any Investor Stock in violation of any provision of this Agreement
shall be void, and the Company shall not record such Transfer on its books or
treat any purported transferee of such Investor Stock as the owner of such
stock for any purpose.
6C. Severability. Whenever possible, each provision of this
------------
Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
invalid, illegal or unenforceable in any respect under any applicable law or
rule in any jurisdiction, such invalidity, illegality or unenforceability will
not affect any other provision or any other jurisdiction, but this Agreement
will be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
6D. Complete Agreement. This Agreement, those documents expressly
------------------
referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the parties and supersede and preempt any
prior summaries of terms and conditions, understandings, agreements or
representations by or among the parties, written or oral, which may have related
to the subject matter hereof in any way.
6E. Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original
- 12 -
<PAGE>
and all of which taken together constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided
----------------------
herein, this Agreement shall bind Purchaser and the Company and their respective
successors and permitted assigns and inure to the benefit of and be enforceable
by Purchaser, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Purchaser's Stock);
provided that Purchaser may not assign any of its rights under any provision of
- --------
this Agreement except as part of a Transfer of Investor Stock in accordance with
Section 3.
6G. Choice of Law. The corporate law of the State of
-------------
Delaware will govern all questions concerning the relative rights of the Company
and its stockholders. All other questions concerning the construction,
validity and interpretation of this Agreement and the exhibits hereto will be
governed by and construed in accordance with the internal laws of the State of
Illinois, without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have
--------
all rights and remedies set forth in this Agreement and the Certificate of
Incorporation and all rights and remedies which such holders have been granted
at any time under any other agreement or contract and all of the rights which
such holders have under any law. Any Person having any rights under any
provision of this Agreement shall be entitled to enforce such rights
specifically (without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law.
6I. Amendment and Waiver. Except as otherwise expressly
--------------------
provided herein, the provisions of this Agreement may be amended or modified
only by written agreement of the Company, Purchaser and GTCR. No other course of
dealing between the parties or third party beneficiaries hereof or any delay
in exercising any rights hereunder shall operate as a waiver of any rights of
any such holders.
- 13 -
<PAGE>
6J. Survival of Representations and Warranties. All
------------------------------------------
representations and warranties contained herein or made in writing by any party
in connection herewith shall survive the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby,
regardless of any investigation made by Purchaser or on its behalf or by the
Company or on its behalf.
6K. Business Days. If any time period for giving notice
-------------
or taking action hereunder expires on a day which is a Saturday, Sunday or
holiday in the state in which the Company's chief executive office is located,
the time period shall be automatically extended to the business day immediately
following such Saturday, Sunday or holiday.
6L. Descriptive Headings; Interpretation. The descriptive
------------------------------------
headings of this Agreement are inserted for convenience only and do not
constitute a Section of this Agreement. The use of the word "including" in this
Agreement shall be by way of example rather than by limitation.
* * * * *
- 14 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE COINMACH CORPORATION
By /s/ STEPHEN R. KERRIGAN
---------------------------
Its Chief Executive Officer
--------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /s/ CARL D. THOMAS
--------------------------
Its: Principal
MCS CAPITAL, INC.
By: /s/ STEPHEN R. KERRIGAN
------------------------
Its: President
/s/ STEPHEN R. KERRIGAN
-----------------------
Stephen R. Kerrigan
- 15 -
<PAGE>
EXHIBIT 17
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"), Mitchell Blatt (the
-------
"Purchaser") and Golder, Thoma, Cressey, Rauner Fund IV, L.P. ("GTCR").
--------- ----
The Company and the Purchaser desire to enter into an agreement
pursuant to which the Purchaser will purchase, and the Company will issue, 400
shares of the Company's Class A Common Stock, par value $0.01 per share (the
"Class A Common Stock"). Certain definitions are set forth in Section 5 of this
--------------------
Agreement.
Simultaneously with the execution of this Agreement, (i) each of
Heller Financial, Inc. ("Heller"), Jackson National Life Insurance Company
------
("Jackson") and Jackson National Life Insurance Company of Michigan ("Jackson
------- -------
Michigan" and, together with Heller and Jackson, the "Lenders") are entering
- -------- -------
into investor purchase agreements (the "Other Investor Purchase Agreements")
----------------------------------
substantially similar to this Agreement pursuant to which Heller, Jackson and
Jackson Michigan will acquire shares of the Company's Class C Common Stock and
(ii) each of the President and Fellows of Harvard College ("Harvard"), MCS
-------
Capital, Inc. ("MCS"), MCS Capital Management Capital, Inc. ("MCS Management"),
--- --------------
Michael Marrus ("Marrus") and James N. Chapman ("Chapman") are entering into
------ -------
investor purchase agreements substantially similar to this Agreement pursuant to
which Harvard, MCS, MCS Management, Marrus and Chapman will also acquire shares
of the Company's Class A Common Stock, par value $0.01 per share (the "Class A
-------
Common Stock"). The Heller, Jackson, Jackson Michigan, Harvard, Chapman, Marrus,
- ------------
MCS Management and MCS investor purchase agreements are referred to herein as
the "Other Investor Purchase Agreements" and along with this Agreement as the
----------------------------------
"Investor Purchase Agreements."
----------------------------
The execution and delivery of this Agreement by the Company and
Purchaser is a condition to the purchase of 72,516 shares of Class A Common
Stock by GTCR and certain shares of the Company's Class B Common Stock, par
value $0.01 per share (the "Class B Common Stock") by certain members of the
--------------------
Company's management pursuant to purchase agreements between the Company and
each of such Persons dated as of the date hereof (along with the Investor
Purchase Agreements, the "Purchase Agreements"). The Class A Common Stock, Class
-------------------
B Common Stock, Class C Common Stock
<PAGE>
and the Company's Class D Common Stock, par value $0.01 per share (the "Class D
-------
Common Stock"), are hereinafter collectively referred to as the "Common Stock".
- ------------ ------------
Certain provisions of this Agreement are intended for the benefit of, and will
be enforceable by, GTCR.
The parties hereto agree as follows
Section 1. Authorization and Closing
-------------------------
1A. Authorization of the Stock. The Company shall authorize the issuance
--------------------------
to Purchaser of 400 shares of Class A Common Stock having the rights set forth
in Exhibit A attached hereto.
---------
1B. Purchase and Sale of Investor Stock. At the Closing (as defined in
-----------------------------------
Section 1C below), the Company shall sell to the Purchaser and, subject to the
terms and conditions set forth herein, the Purchaser shall purchase from the
Company 400 shares of the Class A Common at a price of $144.7964 per share.
1C. The Closing. The closing of the purchase and sale of
-----------
the Stock (the "Closing") shall take place at the offices of Kirkland & Ellis,
-------
200 East Randolph Drive, Chicago, Illinois 60601 at 10:00 a.m. on January 31,
1995, or at such other place or on such other date as may be mutually agreeable
to the Company and the Purchaser. At the Closing, the Company shall deliver to
the Purchaser stock certificates evidencing the Class A Common to be purchased
by the Purchaser, registered in the Purchaser's name, upon payment of the
purchase price thereof by a cashier's or certified check, or by wire transfer of
immediately available funds to such account as designated by the Company in the
amount of $57,918.55.
Section 2. Representations and Warranties.
------------------------------
2A. Representations and Warranties of Purchaser. In connection with
-------------------------------------------
the issuance of the Investor Stock hereunder, Purchaser represents and warrants
to the Company that, in each case, as of the Closing:
(i) The Class A Common Stock to be acquired by Purchaser pursuant to
this Agreement will be acquired for Purchaser's own account and not with a
view to, or intention of, distribution thereof in violation of the
Securities Act, or
- 2 -
<PAGE>
any applicable state securities laws, and such Class A Common Stock will not
be disposed of in contravention of the Securities Act or any applicable
state securities laws.
(ii) Purchaser is able to bear the economic risk of its investment in
such Class A Common Stock for an indefinite period of time, and Purchaser
acknowledges that such Class A Common Stock has not been registered under
the Securities Act and, therefore, cannot be sold unless subsequently
registered under the Securities Act or an exemption from such registration
is available.
(iii) Purchaser has had an opportunity to ask questions
and receive answers concerning the terms and conditions of the offering of
such Class A Common Stock and has had full access to such other information
concerning the Company as it has requested.
(iv) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Purchaser,
enforceable in accordance with their terms, and the execution, delivery and
performance of this Agreement, the Stockholders Agreement and the
Registration Agreement by Purchaser does not and will not conflict with,
violate or cause a breach of any agreement, contract or instrument to which
Purchaser is a party or any law, rule, regulation, judgment, order or decree
to which Purchaser is subject.
2B. Representations and Warranties of the Company. In connection
---------------------------------------------
with the issuance of the Investor Stock hereunder, the Company represents to
Purchaser that, in each case, as of the Closing:
(i) Organization and Corporate Power. The Company is a
--------------------------------
corporation duly organized, validly existing and in good standing under the
laws of Delaware. The Company has all requisite corporate power and
authority to carry out the transactions contemplated by this Agreement, the
Purchase Agreements, the Stockholders Agreement and the Registration
Agreement (the "Investment Agreements"). The copies of the Company's
---------------------
Certificate of Incorporation and Bylaws which have been furnished to
Purchaser's counsel reflect all amendments
- 3 -
<PAGE>
made thereto at any time prior to the date of this Agreement and are correct
and complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately thereafter, the authorized
capital stock of the Company shall consist of 10,000 shares which will be
designated as Preferred Stock and 108,150 shares of Common Stock, of which
77,350 shares shall be designated as Class A Common Stock, 15,500 shares
shall be designated Class B Common Stock, 7650 shares shall be designated as
Class C Common Stock and 7650 shares shall be designated as Class D Common
Stock. As of the Closing, the Company shall not have outstanding any stock
or securities convertible or exchangeable for any shares of its capital
stock or containing any profit participation features, nor shall it have
outstanding any rights or options to subscribe for or to purchase its
capital stock or any stock or securities convertible into or exchangeable
for its capital stock or any stock appreciation rights or phantom stock
plans other than pursuant to and as contemplated by this Agreement, the
Purchase Agreements, the Stockholders Agreement and the Company's
Certificate of Incorporation. As of the Closing, the Company shall not be
subject to any obligation (contingent or otherwise) to repurchase or
otherwise acquire or retire any shares of its capital stock or any warrants,
options or other rights to acquire its capital stock, except pursuant to
this Agreement, the Stockholders Agreement and the Purchase Agreements. As
of the Closing, all of the outstanding shares of the Company's capital stock
shall be validly issued, fully paid and nonassessable.
(b) There are no statutory or contractual stockholders preemptive
rights or rights of refusal with respect to the issuance of the Common Stock
hereunder, except as provided herein and in the Stockholders Agreement. The
Company has not violated any applicable federal or state securities laws in
connection with the offer, sale or issuance of any of its capital stock, and
the offer, sale and issuance of the Common Stock pursuant
- 4 -
<PAGE>
to this Agreement do not and will not require registration under the
Securities Act.
(iii) Conduct of Business; Liabilities. Other than in the course of
--------------------------------
the negotiation, execution and delivery of this Agreement, the
Purchase Agreements and the other agreements contemplated hereby and
thereby, prior to the Closing, the Company has not (i) conducted any
business, (ii) incurred any expenses, obligations or liabilities (whether
accrued, absolute, contingent, unliquidated or otherwise, whether or not
known to the Company and whether due or to become due and regardless of when
asserted), (iii) owned any assets, or (iv) entered into any contracts or
agreements.
Section 3. Restrictions on Transfer.
------------------------
3A. Transfer of Investor Stock.
--------------------------
(i) Subject to the restrictions set forth in the remainder of this
Section 3, Investor Stock is transferable only pursuant to (a) a Public
Offering registered under the Securities Act, (b) Rule 144 or Rule 144A of
the Securities and Exchange Commission (or any similar rule or rules then in
force) if such rule or rules are available or (c) subject to the
conditions specified in Section 3A(ii) below, any other legally available
means of transfer.
(ii) In connection with the transfer of any Investor Stock (other than
a transfer described in Section 3A(i)(a) or (b) above), the holder thereof
shall deliver written notice to the Company describing in reasonable detail
the transfer or proposed transfer, together with an opinion of counsel which
(to the Company's reasonable satisfaction) is knowledgeable in securities
law matters to the effect that such transfer of Investor Stock may be
effected without registration of such Investor Stock under the Securities
Act. In addition, if the holder of the Investor Stock delivers to the
Company an opinion of counsel that no subsequent transfer of such Investor
Stock shall require registration under the Securities Act, the Company
shall promptly upon such contemplated transfer deliver new certificates for
such Investor Stock which do not bear the Securities Act legend set forth in
Section 4A hereof. If the Company is not required to deliver
- 5 -
<PAGE>
new certificates for such Investor Stock not bearing such legend, the
holder thereof shall not transfer the same until the prospective transferee
has confirmed to the Company in writing its agreement to be bound by the
conditions contained in this Section and Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company shall promptly
supply to the Purchaser or its prospective transferees all information
regarding the Company required to be delivered in connection with a
transfer pursuant to Rule 144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor Stock in
violation of any provision of this Agreement shall be void, and the Company
shall not record such transfer on its books or treat any purported
transferee of such Investor Stock as the owner of such Investor Stock for
any purpose.
3B. Sale Notice. Prior to making any Transfer of Investor Stock,
-----------
Purchaser will give written notice (the "Sale Notice") to the Company and GTCR.
-----------
The Sale Notice will disclose in reasonable detail the number of shares to be
transferred and the terms and conditions of the proposed Transfer and, if known,
the identity of the prospective transferee(s). Purchaser will not consummate any
such Transfer until 60 days after the Sale Notice has been given to the Company
and to GTCR, unless the parties to the Transfer have been fully determined
pursuant to this Section 3B and Sections 3C and 3D prior to the expiration of
such 60-day period. (The date of the first to occur of such events is referred
to herein as the "Authorization Date.")
------------------
3C. First Refusal Rights. The Company may elect to purchase all (but
---------------------
not less than all) of the shares of Investor Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Purchaser and GTCR within 30 days after the
Sale Notice has been given to the Company. If the Company has not elected to
purchase all of the Investor Stock to be transferred, GTCR may elect to purchase
all (but not less than all) of the Investor Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by giving
written notice of such election to Purchaser within 60 days after the Sale
Notice has been given to GTCR. If neither the Company nor GTCR elect to purchase
all of the
- 6 -
<PAGE>
shares of Investor Stock specified in the Sale Notice, Purchaser may transfer
the shares of Investor Stock specified in the Sale Notice at a price and on
terms no more favorable to the transferee(s) thereof than specified in the Sale
Notice during the 30-day period immediately following the Authorization Date.
Any shares of Investor Stock not transferred within such 30-day period will be
subject to the provisions of this Section 3C upon subsequent transfer.
3D. Co-Sale Rights.
--------------
(i) GTCR may elect to participate in the contemplated Transfer by
delivering written notice to Purchaser within 90 days after delivery of
the Sale Notice to GTCR. If GTCR has elected to participate in such
Transfer, Purchaser and GTCR shall be entitled to sell in the contemplated
Transfer, on the same terms and at the price calculated pursuant to sub
paragraph 3D(ii) below, a number of shares equal to the product of (x) the
quotient determined by dividing the number of shares of Common Stock owned
by such person by the aggregate number of shares of Common Stock owned by
Purchaser and GTCR and (y) the number of shares to be sold in the
contemplated Transfer.
For example, if the Sale Notice contemplated a sale of 100 shares
-----------
by Purchaser, and if Purchaser was at such time the owner of 30% of the
Company's Common Stock (on a fully-diluted basis) and if GTCR elected to
participate and GTCR owned 20% of the Company's Common Stock (on a fully-
diluted basis), Purchaser would be entitled to sell 60 shares (30% / 50% x
100 shares) and GTCR would be entitled to sell 40 shares (20% / 50% x 100
shares).
Purchaser will use its best efforts to obtain the agreement of the
prospective transferee(s) to the participation of GTCR in the contemplated
transfer and will not transfer any Investor Stock to the prospective
transferee(s) if such transferee(s) refuses to allow the participation of
GTCR.
(ii) The purchase price to be paid by any transferee for shares of Class A
Common transferred in accordance with this paragraph 3D shall be equal to
the amount per share of Class A Common which such transferee has agreed to
pay to Purchaser.
- 7 -
<PAGE>
Section 4. Additional Restrictions on Transfer of Investor Stock.
----------------------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring
------
the Investor Stock purchased hereunder or acquired pursuant hereto for its own
account with the present intention of holding such securities for purposes of
investment, and that it has no intention of selling such securities in a public
distribution in violation of the federal securities laws or any applicable state
securities laws; provided that nothing contained herein shall prevent the
Purchaser and subsequent holders of Investor Stock from transferring such
securities in compliance with the provisions of Section 4 hereof. Each
certificate for Investor Stock shall be imprinted with a legend in substantially
the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE
ORIGINALLY ISSUED AS OF JANUARY 31, 1995, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN
EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO
ADDITIONAL RESTRICTIONS ON TRANSFER AND CERTAIN OTHER
AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE AGREEMENT
BETWEEN THE COMPANY AND CERTAIN INVESTORS, DATED AS OF
JANUARY 31, 1995. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY
THE HOLDER HEREOF AT THE ISSUER'S PRINCIPAL PLACE OF BUSINESS
WITHOUT CHARGE."
4B. Opinion of Counsel. No holder of Investor Stock may sell,
------------------
transfer or dispose of any Investor Stock (except pursuant to an effective
registration statement under the Securities Act) without first delivering to
the Company an opinion of counsel (reasonably acceptable in form and substance
to the Company) that (i) neither registration nor qualification under the
Securities Act and applicable state securities laws is required in connection
with such transfer or (ii) all such applicable registration and qualification
requirements have been satisfied.
- 8 -
<PAGE>
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class A Common issued hereunder and
--------------
(ii) any Common Stock issued or issuable with respect to the Common Stock
referred to in clause (i) above by way of stock dividends or stock splits or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization. As to any particular shares of Investor Stock, such
shares shall cease to be Investor Stock when they have been (a) effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them or (b) distributed to the public through a
broker, dealer or market maker pursuant to Rule 144 under the Securities Act (or
any similar rule then in force). Whenever any particular securities cease to be
Investor Stock, the holder thereof shall be entitled to receive from the
Company, without expense, new securities of like tenor not bearing a Securities
Act legend of the character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an
------
association, a joint stock company, a trust, a joint venture, an unincorporated
organization and a governmental entity or any department, agency or political
subdivision thereof.
"Public Offering" means the sale in an underwritten public offering
---------------
registered under the Securities Act (other than on Form S-8 or a similar or
successor form) of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public
-----------
Offering under the Securities Act or any sale to the public pursuant to Rule 144
promulgated under the Securities Act effected through a broker, dealer or market
maker.
"Registration Agreement" means the Registration Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Purchaser.
"Securities Act" means the Securities Act of 1933, as amended, or any
--------------
similar federal law then in force.
- 9 -
<PAGE>
"Securities Exchange Act" means the Securities Exchange Act of 1934,
-----------------------
as amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or
----------------------------------
agency succeeding to the functions thereof.
"Stockholders Agreement" means the Stockholders Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Purchaser.
"Transfer" means to sell, transfer, assign, pledge or otherwise
--------
dispose of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) other than pursuant to a Public Sale or
Sale of the Company.
Section 6. Miscellaneous
-------------
6A. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a copy (which will not constitute notice to the Company) to:
----------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
-------------------
Mitchell Blatt
31 Wilmington Drive
Dix Hills, New York 11747
- 10 -
<PAGE>
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the
recipient party shall have specified by prior written notice to the sending
party. Any notice under this Agreement will be deemed to have been given when so
delivered or sent or, if mailed, five days after deposit in the U.S. mail.
6B. Transfers in Violation of Agreement. Any Transfer or attempted
-----------------------------------
Transfer of any Investor Stock in violation of any provision of this Agreement
shall be void, and the Company shall not record such Transfer on its books or
treat any purported transferee of such Investor Stock as the owner of such stock
for any purpose.
6C. Severability. Whenever possible, each provision of this Agreement
------------
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein
6D. Complete Agreement. This Agreement, those documents expressly
------------------
referred to herein and other documents of even date herewith embody the complete
agreement and understanding among the
- 11 -
<PAGE>
parties and supersede and preempt any prior summaries of terms and conditions,
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.
6E. Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Purchaser and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Purchaser, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Purchaser's Stock);
provided that Purchaser may not assign any of its rights under any
- --------
provision of this Agreement except as part of a Transfer of Investor Stock in
accordance with Section 3.
6G. Choice of Law. The corporate law of the State of Delaware will
-------------
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and
construed in accordance with the internal laws of the State of Illinois, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have all rights and
--------
remedies set forth in this Agreement and the Certificate of Incorporation and
all rights and remedies which such holders have been granted at any time under
any other agreement or contract and all of the rights which such holders have
under any law. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically (without posting
a bond or other security), to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law.
- 12 -
<PAGE>
6I. Amendment and Waiver. Except as otherwise expressly provided
--------------------
herein, the provisions of this Agreement may be amended or modified only by
written agreement of the Company, Purchaser and GTCR. No other course of
dealing between the parties or third party beneficiaries hereof or any delay in
exercising any rights hereunder shall operate as a waiver of any rights of any
such holders.
6J. Survival of Representations and Warranties. All representations
------------------------------------------
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Purchaser or on its behalf or by the Company or on its
behalf.
6K. Business Days. If any time period for giving notice or taking
-------------
action hereunder expires on a day which is a Saturday, Sunday or holiday in the
state in which the Company's chief executive office is located, the time period
shall be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
6L. Descriptive Headings; Interpretation. The descriptive headings
------------------------------------
of this Agreement are inserted for convenience only and do not constitute a
Section of this Agreement. The use of the word "including" in this Agreement
shall be by way of example rather than by limitation.
* * * * *
- 13 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE COINMACH CORPORATION
By /s/ STEPHEN R. KERRIGAN
---------------------------
Its Chief Executive Officer
--------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By /s/ CARL D. THOMAS
---------------------------
Its: Principal
/s/ MITCHELL BLATT
-------------------------------
Mitchell Blatt
<PAGE>
EXHIBIT 18
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"), Heller Financial, Inc.
-------
(the "Purchaser") and Golder, Thoma, Cressey, Rauner Fund IV, L.P. ("GTCR").
--------- ----
The Company and the Purchaser desire to enter into an agreement pursuant
to which the Purchaser will purchase, and the Company will issue, 3,825 shares
of the Company's Class C Common Stock, par value $0.01 per share (the "Class C
-------
Common Stock"). Certain definitions are set forth in Section 5 of this
------------
Agreement.
Simultaneously with the execution of this Agreement, (i) each of Jackson
National Life Insurance Company ("Jackson") and Jackson National Life Insurance
-------
Company of Michigan ("Jackson Michigan" and, together with Jackson, the
----------------
"Lenders") are entering into investor purchase agreements (the "Other Investor
------- --------------
Purchase Agreements") substantially similar to this Agreement pursuant to which
-------------------
Jackson and Jackson Life will also acquire shares of the Company's Class C
Common Stock and (ii) each of the President and Fellows of Harvard
College ("Harvard"), MCS Capital, Inc. ("MCS"), MCS Capital Management, Inc.
------- ---
("MCS Management"), James N. Chapman ("Chapman"), Mitchell Blatt ("Blatt") and
--------------- ------- -----
Michael E. Marrus ("Marrus") are entering into investor purchase agreements
------
substantially similar to this Agreement pursuant to which Harvard, MCS, MCS
Management, Chapman, Blatt and Marrus will acquire shares of the Company's
Class A Common Stock, par value $0.01 per share (the "Class A Common Stock").
---------------------
The Jackson, Jackson Michigan, Harvard, Chapman, Blatt, Marrus, MCS Management
and MCS investor purchase agreements are referred to herein as the "Other
-----
Investor Purchase Agreements" and along with this Agreement as the "Investor
---------------------------- --------
Purchase Agreements."
- -------------------
The execution and delivery of this Agreement by the Company and Purchaser
is a condition to the purchase of 72,516 shares of Class A Common Stock by GTCR
and certain shares of the Company's Class B Common Stock, par value $0.01 per
share (the "Class B Common Stock") by certain members of the Company's
--------------------
management pursuant to purchase agreements between the Company and each of such
Persons dated as of the date hereof (along with the Investor Purchase
Agreements, the "Purchase Agreements"). The
-------------------
<PAGE>
Class A Common Stock, Class B Common Stock, Class C Common Stock,
and the Company's Class D Common Stock, par value $0.01 per share
(the "Class D Common Stock"), are hereinafter collectively referred to as
--------------------
the " Common Stock". Certain provisions of this Agreement are intended for
------------
the benefit of, and will be enforceable by, GTCR.
The parties hereto agree as follows:
Section 1. Authorization and Closing
-------------------------
1A. Authorization of the Stock. The Company shall
--------------------------
authorize the issuance to Purchaser of 3,825 shares of Class C Common Stock
having the rights set forth in Exhibit A attached hereto.
---------
1B. Purchase and Sale of Investor Stock. At the Closing (as
-----------------------------------
defined in Section 1C below), the Company shall sell to the Purchaser and,
subject to the terms and conditions set forth herein, the Purchaser shall
purchase from the Company 3,825 shares of the Class C Common at a price of $0.01
per share.
1C. The Closing. The closing of the purchase and sale of the Stock
-----------
(the "Closing") shall take place at the offices of Kirkland & Ellis, 200 East
-------
Randolph Drive, Chicago, Illinois 60601 at 10:00 a.m. on January 31, 1995, or at
such other place or on such other date as may be mutually agreeable to the
Company and the Purchaser. At the Closing, the Company shall deliver to the
Purchaser stock certificates evidencing the Class C Common to be purchased by
the Purchaser, registered in the Purchaser's name, upon payment of the
purchase price thereof by a cashier's or certified check, or by wire transfer
of immediately available funds to such account as designated by the Company in
the amount of $38.25.
Section 2. Representations and Warranties.
------------------------------
2A. Representations and Warranties of Purchaser. In connection with the
--------------------------------------------
issuance of the Investor Stock hereunder, Purchaser represents and warrants to
the Company that, in each case, as of the Closing:
- 2 -
<PAGE>
(i) The Class C Common Stock to be acquired by Purchaser pursuant to
this Agreement will be acquired for Purchaser's own account and not with a view
to, or intention of, distribution thereof in violation of the Securities Act,
or any applicable state securities laws, and such Class C Common Stock will not
be disposed of in contravention of the Securities Act or any applicable state
securities laws.
(ii) Purchaser is able to bear the economic risk of its investment in
such Class C Common Stock for an indefinite period of time, and Purchaser
acknowledges that such Class C Common Stock has not been registered under the
Securities Act and, therefore, cannot be sold unless subsequently registered
under the Securities Act or an exemption from such registration is available.
(iii) Purchaser has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of such Class C
Common Stock and has had full access to such other information concerning the
Company as it has requested.
(iv) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Purchaser,
enforceable in accordance with their terms, and the execution, delivery and
performance of this Agreement, the Stockholders Agreement and the Registration
Agreement by Purchaser does not and will not conflict with, violate or cause a
breach of any agreement, contract or instrument to which Purchaser is a party or
any law, rule, regulation, judgment, order or decree to which Purchaser is
subject.
2B. Representations and Warranties of the Company. In connection with the
---------------------------------------------
issuance of the Investor Stock hereunder, the Company represents to Purchaser
that, in each case, as of the Closing:
(i) Organization and Corporate Power. The Company is a corporation duly
--------------------------------
organized, validly existing and in good standing under the laws of Delaware. The
Company has all requisite corporate power and authority to carry out the
- 3 -
<PAGE>
transactions contemplated by this Agreement, the Purchase Agreements, the
Stockholders Agreement and the Registration Agreement (the "Investment
----------
Agreements"). The copies of the Company's Certificate of Incorporation and
- ----------
Bylaws which have been furnished to Purchaser's counsel reflect all amendments
made thereto at any time prior to the date of this Agreement and are correct and
complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately thereafter, the authorized capital
stock of the Company shall consist of 10,000 shares which will be designated as
Preferred Stock and 108,150 shares of Common Stock, of which 77,350 shares
shall be designated as Class A Common Stock, 15,500 shares shall be designated
Class B Common Stock, 7650 shares shall be designated as Class C Common Stock
and 7650 shares shall be designated as Class D Common Stock. As of the Closing,
the Company shall not have outstanding any stock or securities convertible or
exchangeable for any shares of its capital stock or containing any profit
participation features, nor shall it have outstanding any rights or options to
subscribe for or to purchase its capital stock or any stock or securities
convertible into or exchangeable for its capital stock or any stock appreciation
rights or phantom stock plans other than pursuant to and as contemplated by this
Agreement, the Purchase Agreements, the Stockholders Agreement and the Company's
Certificate of Incorporation. As of the Closing, the Company shall not be
subject to any obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any shares of its capital stock or any warrants, options or
other rights to acquire its capital stock, except pursuant to this Agreement,
the Stockholders Agreement and the Purchase Agreements. As of the Closing, all
of the outstanding shares of the Company's capital stock shall be validly
issued, fully paid and nonassessable.
(b) There are no statutory or contractual stockholders preemptive rights or
rights of refusal with respect to the issuance of the Common Stock hereunder,
- 4 -
<PAGE>
except as provided herein and in the Stockholders Agreement. The Company
has not violated any applicable federal or state securities laws in
connection with the offer, sale or issuance of any of its capital stock,
and the offer, sale and issuance of the Common Stock pursuant to this
Agreement do not and will not require registration under the Securities
Act.
(iii) Conduct of Business; Liabilities. Other than in the course of the
--------------------------------
negotiation, execution and delivery of this Agreement, the Purchase
Agreements and the other agreements contemplated hereby and thereby, prior
to the Closing, the Company has not (i) conducted any business, (ii)
incurred any expenses, obligations or liabilities (whether accrued,
absolute, contingent, unliquidated or otherwise, whether or not known to
the Company and whether due or to become due and regardless of when
asserted), (iii) owned any assets, or (iv) entered into any contracts or
agreements.
Section 3. Restrictions on Transfer.
------------------------
3A. Transfer of Investor Stock.
--------------------------
(i) Subject to the restrictions set forth in the remainder of this
Section 3, Investor Stock is transferable only pursuant to (a) a Public
Offering registered under the Securities Act, (b) Rule 144 or Rule 144A of
the Securities and Exchange Commission (or any similar rule or rules then
in force) if such rule or rules are available or (c) subject to the
conditions specified in Section 3A (ii) below, any other legally available
means of transfer.
(ii) In connection with the transfer of any Investor Stock (other than a
transfer described in Section 3A (i)(a) or (b) above), the holder thereof
shall deliver written notice to the Company describing in reasonable detail
the transfer or proposed transfer, together with an opinion of counsel which
(to the Company's reasonable satisfaction) is knowledgeable in securities
law matters to the effect that such transfer of Investor Stock may be
effected without registration of such Investor Stock under the Securities
Act. In addition, if the holder of the Investor Stock delivers to the
Company an
- 5 -
<PAGE>
opinion of counsel that no subsequent transfer of such Investor Stock shall
require registration under the Securities Act, the Company shall promptly upon
such contemplated transfer deliver new certificates for such Investor Stock
which do not bear the Securities Act legend set forth in Section 4A hereof. If
the Company is not required to deliver new certificates for such Investor Stock
not bearing such legend, the holder thereof shall not transfer the same until
the prospective transferee has confirmed to the Company in writing its agreement
to be bound by the conditions contained in this Section and Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company shall promptly supply to
the Purchaser or its prospective transferees all information regarding the
Company required to be delivered in connection with a transfer pursuant to Rule
144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor Stock in violation of
any provision of this Agreement shall be void, and the Company shall not record
such transfer on its books or treat any purported transferee of such Investor
Stock as the owner of such Investor Stock for any purpose.
3B. Sale Notice Prior to making any Transfer of Investor Stock, Purchaser will
-----------
give written notice (the "Sale Notice") to the Company and GTCR. The Sale Notice
-----------
will disclose in reasonable detail the number of shares to be transferred and
the terms and conditions of the proposed Transfer and, if known, the identity of
the prospective transferee(s). Purchaser will not consummate any such Transfer
until 60 days after the Sale Notice has been given to the Company and to GTCR,
unless the parties to the Transfer have been fully determined pursuant to this
Section 3B and Section 3C prior to the expiration of such 60-day period. (The
date of the first to occur of such events is referred to herein as the
"Authorization Date.")
------------------
3C. First Refusal Rights. The Company may elect to purchase all (but not
--------------------
less than all) of the shares of Investor Stock to be transferred upon the same
terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Purchaser and GTCR within 30 days after the
Sale Notice
- 6 -
<PAGE>
has been given to the Company. If the Company has not elected to purchase all
of the Investor Stock to be transferred, GTCR may elect to purchase all (but not
less than all) of the Investor Stock to be transferred upon the same terms and
conditions as those set forth in the Sale Notice by giving written notice of
such election to Purchaser within 60 days after the Sale Notice has been given
to GTCR. If neither the Company nor GTCR elect to purchase all of the shares of
Investor Stock specified in the Sale Notice, Purchaser may transfer the shares
of Investor Stock specified in the Sale Notice at a price and on terms no more
favorable to the transferee(s) thereof than specified in the Sale Notice during
the 180-day period immediately following the Authorization Date. Any shares of
Investor Stock not transferred within such 180-day period will be subject to the
provisions of this Section 3C upon subsequent transfer.
3D. Transfers in Connection with Transfers of Term Loan C. The provisions of
-----------------------------------------------------
Sections 3B and 3C shall not apply to any Transfer of Investor Stock by
Purchaser to the transferee of a portion of the Term Loan C then held by
Purchaser in an amount not to exceed the product of (i) the number of shares of
Investor Stock purchased by Purchaser hereunder multiplied by (ii) the quotient
-------------
of (a) the amount of Term Loan C transferred by Purchaser to such transferee
divided by (b) the amount of Term Loan C held by Purchaser on the date thereof;
- ----------
provided that such transferee shall agree to be bound by all of the terms and
provisions of this Agreement and the Stockholders Agreement as if it were a
party hereto and thereto.
For purposes of this Section 3D; "Term Loan C" means Term Loan C as defined in
-----------
the Credit Agreement dated as of the date hereof among Coinmach Industries Co.,
L.P. and Super Laundry Equipment Co., L.P., as borrower, Heller Financial, Inc.
as agent and lender, and Jackson Life Insurance Company and Jackson Life
Insurance Company of Michigan, as lenders, as amended from time to time.
Section 4. Additional Restrictions on Transfer of Investor Stock.
-----------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring the Investor
------
Stock purchased hereunder or acquired
- 7 -
<PAGE>
pursuant hereto for its own account with the present intention of holding such
securities for purposes of investment, and that it has no intention of selling
such securities in a public distribution in violation of the federal securities
laws or any applicable state securities laws; provided that nothing contained
herein shall prevent the Purchaser and subsequent holders of Investor Stock from
transferring such securities in compliance with the provisions of Section 4
hereof. Each certificate for Investor Stock shall be imprinted with a legend in
substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED AS OF
JANUARY 31, 1995, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
l933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION
FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER AND
CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE AGREEMENT
BETWEEN THE COMPANY AND CERTAIN INVESTORS, DATED AS OF JANUARY 31, 1995. A
COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S
PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
4B. Opinion of Counsel. No holder of Investor Stock may sell, transfer or
------------------
dispose of any Investor Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that (i) neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer or
(ii) all such applicable registration and qualification requirements have been
satisfied.
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class C Common issued hereunder and (ii)
--------------
any Common Stock issued or issuable with respect
- 8 -
<PAGE>
to the Common Stock referred to in clause (i) above by way of stock dividends or
stock splits or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization. As to any particular shares of
Investor Stock, such shares shall cease to be Investor Stock when they have been
(a) effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering them or (b) distributed to
the public through a broker, dealer or market maker pursuant to Rule 144 under
the Securities Act (or any similar rule then in force). Whenever any particular
securities cease to be Investor Stock, the holder thereof shall be entitled to
receive from the Company, without expense, new securities of like tenor not
bearing a Securities Act legend of the character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an association, a
------
joint stock company, a trust, a joint venture, an unincorporated organization
and a governmental entity or any department, agency or political subdivision
thereof.
"Public Offering" means the sale in an underwritten public offering registered
---------------
under the Securities Act (other than on Form S-8 or a similar or successor form)
of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering under
-----------
the Securities Act or any sale to the public pursuant to Rule 144 promulgated
under the Securities Act effected through a broker, dealer or market maker.
"Registration Agreement" means the Registration Agreement dated as of the date
----------------------
hereof among the Company, the Investors (as defined in that Agreement) and
Purchaser.
"Securities Act" means the Securities Act of 1933, as amended, or any similar
--------------
federal law then in force.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
-----------------------
amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or agency
----------------------------------
succeeding to the functions thereof.
- 9 -
<PAGE>
"Stockholders Agreement" means the Stockholders Agreement dated as
----------------------
of the date hereof among the Company, the Investors (as defined in that
Agreement) and Purchaser.
"Transfer" means to sell, transfer, assign, pledge or otherwise
--------
dispose of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) other than pursuant to a Public Sale or
Sale of the Company.
Section 6. Miscellaneous
-------------
6A. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a Copy (which will constitute notice to the
-----------------------------------------------
Company) to:
------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
-------------------
Heller Financial, Inc.
500 West Monroe
Chicago, IL 60661
Attention: Portfolio Manager
Portfolio Organization
Corporate Finance Group
- 10 -
<PAGE>
With a copy (which will not constitute notice to Purchaser) to:
--------------------------------------------------------------
Katten Muchin & Zavis
525 West Monroe Streets, Suite 1600
Chicago, IL 60661
Attention: Stuart P. Shulruff, Esq.
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
6B. Transfers in violation of Agreement. Any Transfer or attempted
-----------------------------------
Transfer of any Investor Stock in violation of any provision of this Agreement
shall be void, and the Company shall not record such Transfer on its books or
treat any purported transferee of such Investor Stock as the owner of such stock
for any purpose.
6C. Severability. Whenever possible, each provision of this Agreement
------------
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction,
- 11 -
<PAGE>
such invalidity, illegality or unenforceability will not affect any other
provision or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.
6D. Complete Agreement. This Agreement, those documents expressly referred to
------------------
herein and other documents of even date herewith embody the complete agreement
and understanding among the parties and supersede and preempt any prior
summaries of terms and conditions, understandings, agreements or representations
by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.
6E. Counterparts. This Agreement may be executed in separate counterparts,
------------
each of which is deemed to be an original and all of which taken together
constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Purchaser and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Purchaser, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Purchaser's Stock);
provided that Purchaser may not assign any of its rights under any provision of
- --------
this Agreement except as part of a Transfer of Investor Stock in accordance with
Section 3.
6G. Choice of Law. The corporate law of the State of Delaware will govern all
-------------
questions concerning the relative rights of the Company and its stockholders.
All other questions concerning the construction, validity and interpretation of
this Agreement and the exhibits hereto will be governed by and construed in
accordance with the internal laws of the State of Illinois, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of Illinois or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have all rights and remedies
--------
set forth in this Agreement and the
- 12 -
<PAGE>
Certificate of Incorporation and all rights and remedies which such holders have
been granted at any time under any other agreement or contract and all of the
rights which such holders have under any law. Any Person having any rights under
any provision of this Agreement shall be entitled to enforce such rights
specifically (without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law.
6I. Amendment and Waiver. Except as otherwise expressly provided herein, the
--------------------
provisions of this Agreement may be amended or modified only by written
agreement of the Company, Purchaser and GTCR. No other course of dealing between
the parties or third party beneficiaries hereof or any delay in exercising any
rights hereunder shall operate as a waiver of any rights of any such holders.
6J. Survival of Representations and Warranties. All representations and
------------------------------------------
warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Purchaser or on its behalf or by the Company or on its
behalf.
6K. Business Days. If any time period for giving notice or taking action
-------------
hereunder expires on a day which is a Saturday, Sunday or holiday in the state
in which the Company's chief executive office is located, the time period shall
be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
6L. Descriptive Headings; Interpretation. The descriptive headings of this
------------------------------------
Agreement are inserted for convenience only and do not constitute a Section of
this Agreement. The use of the word "including" in this Agreement shall be by
way of example rather than by limitation.
* * * * * *
- 13 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first written above.
THE COINMACH CORPORATION
By: /s/ Stephen R. Kerrigan
----------------------------
Its: CEO
---------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /s/ Carl D. Thoma
----------------------------
Its: Principal
HELLER FINANCIAL, INC.
By: /s/ Ellen T. Cook
----------------------------
Its: Assistant Vice President
<PAGE>
EXHIBIT 19
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"), Jackson National Life
-------
Insurance Company (the "Purchaser") and Golder, Thoma, Cressey, Rauner Fund IV,
---------
L.P. ("GTCR").
----
The Company and the Purchaser desire to enter into an agreement pursuant
to which the Purchaser will purchase, and the Company will issue, 3,443 shares
of the Company's Class C Common Stock, par value $0.01 per share (the "Class C
-------
Common Stock"). Certain definitions are set forth in Section 5 of this
- ------------
Agreement.
Simultaneously with the execution of this Agreement, (i) each of Heller
Financial, Inc. ("Heller") and Jackson National Life Insurance Company of
------
Michigan ("Jackson Michigan" and, together with Heller the " Lenders ") are
---------------- -------
entering 1nto investor purchase agreements (the "Other Investor Purchase
-----------------------
Agreements") substantially similar to this Agreement pursuant to which Heller
- -----------
and Jackson Life will also acquire shares of the Company's Class C Common Stock
and (ii) each of the President and Fellows of Harvard College ("Harvard"), MCS
-------
Capital, Inc. ("MCS"), MCS Capital Management, Inc. ("MCS Management"), James N.
--- --------------
Chapman ("Chapman"), Mitchell Blatt ("Blatt") and Michael E. Marrus ("Marrus")
------- ----- ------
are enter1ng into investor purchase agreements substantially similar to this
Agreement pursuant to which Harvard, MCS, MCS Management, Blatt, Chapman and
Marrus will acquire shares of the Company's Class A Common Stock, par value
$0.01 per share (the "Class A Common Stock"). The Heller, Jackson Michigan,
--------------------
Harvard, Chapman, Blatt, MCS Management, Marrus and MCS investor purchase
agreements are referred to herein as the "Other Investor Purchase Agreements"
----------------------------------
and along with this Agreement as the "Investor Purchase Agreements."
----------------------------
The execution and delivery of this Agreement by the Company and Purchaser
is a condition to the purchase of 72,516 shares of Class A Common Stock by GTCR
and certain shares of the Company's Class B Common Stock, par value $0.01 per
share (the "Class B Common Stock") by certain members of the Company's
--------------------
management pursuant to purchase agreements between the Company and each of such
Persons dated as of the date hereof (along with the Investor Purchase
Agreements, the "Purchase Agreements"). The Class A Common Stock, Class B Common
-------------------
Stock, Class C Common Stock
<PAGE>
and the Company's Class D Common Stock, par value $0.01 per share (the "Class D
-------
Common Stock"), are hereinafter collectively referred to as the "Common Stock".
- ------------ ------------
Certain provisions of this Agreement are intended for the benefit of, and will
be enforceable by, GTCR.
The parties hereto agree as follows:
Section 1. Authorization and Closing
-------------------------
1A. Authorization of the Stock. The Company shall authorize the
--------------------------
issuance to Purchaser of 3,443 shares of Class C Common Stock having the rights
set forth in Exhibit A attached hereto.
1B. Purchase and Sale of Investor Stock. At the Closing (as defined in
-----------------------------------
Section 1C below), the Company shall sell to the Purchaser and, subject to the
terms and conditions set forth herein, the Purchaser shall purchase from the
Company 3,443 shares of the Class C Common at a price of $0.01 per share.
1C. The Closing. The closing of the purchase and sale of the Stock (the
-----------
"Closing") shall take place at the offices of Kirkland & Ellis, 200 East
-------
Randolph Drive, Chicago, Illinois 60601 at 10:00 a.m. on January 31, 1995, or at
such other place or on such other date as may be mutually agreeable to the
Company and the Purchaser. At the Closing, the Company shall deliver to the
Purchaser stock certificates evidencing the Class C Common to be purchased by
the Purchaser, registered in the Purchaser's name, upon payment of the purchase
price thereof by a cashier's or certified check, or by wire transfer of
immediately available funds to such account as designated by the Company in the
amount of $34.43.
Section 2. Representations and Warranties.
------------------------------
2A. Representations and Warranties of Purchaser.
-------------------------------------------
In connection with the issuance of the Investor Stock hereunder, Purchaser
represents and warrants to the Company that, in each case, as of the Closing:
(i) The Class C Common Stock to be acquired by Purchaser pursuant to
this Agreement will be acquired for Purchaser's own account and not with a view
to, or intention of,
- 2 -
<PAGE>
distribution thereof in violation of the Securities Act, or any applicable state
securities laws, and such Class C Common Stock will not be disposed of in
contravention of the Securities Act or any applicable state securities laws.
(ii) Purchaser is able to bear the economic risk of its investment in
such Class C Common Stock for an indefinite period of time, and Purchaser
acknowledges that such Class C Common Stock has not been registered under the
Securities Act and, therefore, cannot be sold unless subsequently registered
under the Securities Act or an exemption from such registration is available.
(iii) Purchaser has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of such Class C
Common Stock and has had full access to such other information concerning the
Company as it has requested.
(iv) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Purchaser,
enforceable in accordance with their terms, and the execution, delivery and
performance of this Agreement, the Stockholders Agreement and the Registration
Agreement by Purchaser does not and will not conflict with, violate or cause a
breach of any agreement, contract or instrument to which Purchaser is a party or
any law, rule, regulation, judgment, order or decree to which Purchaser is
subject.
2B. Representations and Warranties of the Company. In connection with
---------------------------------------------
the issuance of the Investor Stock hereunder, the Company represents to
Purchaser that, in each case, as of the Closing:
(i) Organization and Corporate Power. The company is a corporation duly
--------------------------------
organized, validly existing and in good standing under the laws of Delaware.
The Company has all requisite corporate power and authority to carry out the
transactions contemplated by this Agreement, the Purchase Agreements, the
Stockholders Agreement and the Registration Agreement (the "Investment
----------
Agreements"). The copies of the Company's Certificate of Incorporation and
----------
Bylaws which have
- 3 -
<PAGE>
been furnished to Purchaser's counsel reflect all amendments made thereto at
any time prior to the date of this Agreement and are correct and complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately there after, the authorized
capital stock of the Company shall consist of 10,000 shares which will
be designated as Preferred Stock and 108,150 shares of Common Stock, of
which 77,350 shares shall be designated as Class A Common Stock, 15,500
shares shall be designated Class B Common Stock, 7650 shares shall be
designated as Class C Common Stock and 7650 shares shall be designated
as Class D Common Stock. As of the Closing, the Company shall not have
outstanding any stock or securities convertible or exchangeable for any
shares of its capital stock or containing any profit participation
features, nor shall it have outstanding any rights or options to
subscribe for or to purchase its capital stock or any stock or
securities convertible into or exchangeable for its capital stock or any
stock appreciation rights or phantom stock plans other than pursuant to
and as contemplated by this Agreement, the Purchase Agreements, the
Stockholders Agreement and the Company's Certificate of Incorporation.
As of the Closing, the Company shall not be subject to any obligation
(contingent or otherwise) to repurchase or otherwise acquire or retire
any shares of its capital stock or any warrants, options or other rights
to acquire its capital stock, except pursuant to this Agreement, the
Stockholders Agreement and the Purchase Agreements. As of the Closing,
all of the outstanding shares of the Company's capital stock shall be
validly issued, fully paid and nonassessable.
(b) There are no statutory or contractual stockholders preemptive
rights or rights of refusal with respect to the issuance of the Common
Stock hereunder, except as provided herein and in the Stockholders
Agreement. The Company has not violated any applicable federal or state
securities laws in connection with the offer, sale or issuance of any of
its capital stock, and the offer, sale and issuance of the Common Stock
pursuant
- 4 -
<PAGE>
to this Agreement do not and will not require registration under the
Securities Act.
(iii) Conduct of Business; Liabilities. Other than in the course of the
--------------------------------
negotiation, execution and delivery of this Agreement, the Purchase Agreements
and the other agreements contemplated hereby and thereby, prior to the Closing,
the Company has not (i) conducted any business, (ii) incurred any expenses,
obligations or liabilities (whether accrued, absolute, contingent, unliquidated
or otherwise, whether or not known to the Company and whether due or to become
due and regardless of when asserted), (iii) owned any assets, or (iv) entered
into any contracts or agreements.
Section 3. Restrictions on Transfer.
-------------------------
3A. Transfer of Investor Stock.
---------------------------
(i) Subject to the restrictions set forth in the remainder of this
Section 3, Investor Stock is transferable only pursuant to (a) a Public Offering
registered under the Securities Act, (b) Rule 144 or Rule 144A of the Securities
and Exchange Commission (or any similar rule or rules then in force) if such
rule or rules are available or (c) subject to the conditions specified in
Section 3A(ii) below, any other legally available means of transfer.
(ii) In connection with the transfer of any Investor Stock (other than a
transfer described in Section 3A(i)(a) or (b) above), the holder thereof shall
deliver written notice to the Company describing in reasonable detail the
transfer or proposed transfer, together with an opinion of counsel which (to the
Company's reasonable satisfaction) is knowledgeable in securities law matters to
the effect that such transfer of Investor Stock may be effected without
registration of such Investor Stock under the Securities Act. In addition, if
the holder of the Investor Stock delivers to the Company an opinion of counsel
that no subsequent transfer of such Investor Stock shall require registration
under the Securities Act, the Company shall promptly upon such contemplated
transfer deliver new certificates for such Investor Stock which do not bear the
Securities Act legend set forth in Section 4A hereof. If the Company is not
required to deliver
- 5 -
<PAGE>
new certificates for such Investor Stock not bearing such legend the
holder thereof shall not transfer the same until the prospective
transferee has confirmed to the Company in writing its agreement to be
bound by the conditions contained in this Section and Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company shall promptly
supply to the Purchaser or its prospective transferees all information
regarding the Company required to be delivered in connection with a
transfer pursuant to Rule 144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor Stock in
violation of any provision of this Agreement shall be void, and the Company
shall not record such transfer on its books or treat any purported
transferee of such Investor Stock as the owner of such Investor Stock for
any purpose.
3B. Sale Notice. Prior to making any Transfer of Investor Stock,
-----------
Purchaser will give written notice (the "Sale Notice") to the Company and GTCR.
-----------
The Sale Notice will disclose in reasonable detail the number of shares to be
transferred and the terms and conditions of the proposed Transfer and, if known,
the identity of the prospective transferee(s) . Purchaser will not consummate
any such Transfer until 60 days after the Sale Notice has been given to the
Company and to GTCR, unless the parties to the Transfer have been fully
determined pursuant to this Section 3B and Section 3C prior to the expiration of
such 60-day period. (The date of the first to occur of such events is referred
to herein as the "Authorization Date.")
-------------------
3C. First Refusal Rights. The Company may elect to purchase all
---------------------
(but not less than all) of the shares of Investor Stock to be transferred upon
the same terms and conditions as those set forth in the Sale Notice by
delivering a written notice of such election to Purchaser and GTCR within 30
days after the Sale Notice has been given to the Company. If the Company has not
elected to purchase all of the Investor Stock to be transferred, GTCR may elect
to purchase all (but not less than all) of the Investor Stock to be transferred
upon the same terms and conditions as those set forth in the Sale Notice by
giving written notice of such election to Purchaser within 60 days after the
Sale Notice has been given to GTCR. If neither the Company nor GTCR elect to
purchase all of the
- 6 -
<PAGE>
shares of Investor Stock specified in the Sale Notice, Purchaser may transfer
the shares of Investor Stock specified in the Sale Notice at a price and on
terms no more favorable to the transferee(s) thereof than specified in the Sale
Notice during the 180-day period immediately following the Authorization Date.
Any shares of Investor Stock not transferred within such 180-day period will be
subject to the provisions of this Section 3C upon subsequent transfer.
3D. Transfers in Connection with Transfers of Term Loan C. The
-----------------------------------------------------
provisions of Sections 3B and 3C shall not apply to any Transfer of Investor
Stock by Purchaser to the transferee of a portion of the Term Loan C then held
by Purchaser in an amount not to exceed the product of (i) the number of shares
of Investor Stock purchased by Purchaser hereunder multiplied by) the quotient
-------------
of (a) the amount of Term Loan C transferred by Purchaser to such transferee
divided by (b) the amount of Term Loan C held by Purchaser on the date thereof;
- ----------
provided that such transferee shall agree to be bound by all of the terms and
provisions of this Agreement and the Stockholders Agreement as if it were a
party hereto and thereto.
For purposes of this Section 3D; "Term Loan C" means Term Loan C as
-----------
defined in the Credit Agreement dated as of the date hereof among Coinmach
Industries Co., L.P. and Super Laundry Equipment Co., L.P., as borrower, Heller
Financial, Inc. as agent and lender and Jackson Life Insurance Company and
Jackson Life Insurance Company of Michigan, as lenders, as amended from time to
time.
Section 4. Additional Restrictions on Transfer of Investor Stock.
-----------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring the
------
Investor Stock purchased hereunder or acquired pursuant hereto for its own
account with the present intention of holding such securities for purposes of
investment, and that it has no intention of selling such securities in a public
distribution in violation of the federal securities laws or any applicable state
securities laws; provided that nothing contained herein shall prevent the
Purchaser and subsequent holders of Investor Stock from transferring such
securities in compliance with the provisions of
- 7 -
<PAGE>
Section 4 hereof. Each certificate for Investor Stock shall be imprinted with a
legend in substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
AS OF JANUARY 31, l995, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR
AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED BY
THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER
AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE AGREEMENT
BETWEEN THE COMPANY AND CERTAIN INVESTORS, DATED AS OF JANUARY 31, 1995.
A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE
ISSUER'S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE."
4B. Opinion of Counsel. No holder of Investor Stock may sell, transfer
------------------
or dispose of any Investor Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that (i) neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer or
(ii) all such applicable registration and qualification requirements have been
satisfied.
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class C Common issued hereunder and
--------------
(ii) any Common Stock issued or issuable with respect to the Common Stock
referred to in clause (i) above by way of stock dividends or stock splits or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization. As to any particular shares of Investor Stock, such
shares shall cease to be Investor Stock when they have been (a) effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them or (b) distributed to the public through a
broker, dealer or market
- 8 -
<PAGE>
maker pursuant to Rule 144 under the Securities Act (or any similar rule then in
force). Whenever any particular securities cease to be Investor Stock, the
holder thereof shall be entitled to receive from the Company, without expense,
new securities of like tenor not bearing a Securities Act legend of the
character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an association, a
------
joint stock company, a trust, a joint venture, an unincorporated organization
and a governmental entity or any department, agency or political subdivision
thereof.
"Public Offering" means the sale in an underwritten public offering registered
---------------
under the Securities Act (other than on Form S-8 or a similar or successor form)
of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering under
-----------
the Securities Act or any sale to the public pursuant to Rule 144 promulgated
under the Securities Act effected through a broker, dealer or market maker.
"Registration Agreement" means the Registration Agreement dated as of the date
----------------------
hereof among the Company, the Investors (as defined in that Agreement) and
Purchaser.
"Securities Act" means the Securities Act of 1933, as amended, or any similar
--------------
federal law then in force.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
-----------------------
amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or agency
----------------------------------
succeeding to the functions thereof.
"Stockholders Agreement" means the Stockholders Agreement dated as of the date
----------------------
hereof among the Company, the Investors (as defined in that Agreement) and
Purchaser.
"Transfer" means to sell, transfer, assign, pledge or otherwise dispose of
--------
(whether with or without consideration and whether voluntarily or involuntarily
or by operation of law) other than pursuant to a Public Sale or Sale of the
Company.
- 9 -
<PAGE>
Section 6. Miscellaneous
-------------
6A. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a copy (which will not constitute notice to the Company) to:
----------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
-------------------
Jackson National Life Insurance Company
c/o PPM America, Inc.
225 West Wacker Drive, Suite 1200
Chicago, Illinois 60606
Attention: Private Placements
With a copy (which will not constitute notice to Purchaser) to:
--------------------------------------------------------------
Katten Muchin & Zavis
525 West Monroe Street, Suite 1600
Chicago, IL 60661
Attention: Stuart P. Shulruff, Esq.
- 10 -
<PAGE>
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
6B. Transfers in Violation of Agreement. Any Transfer or attempted Transfer of
-----------------------------------
any Investor Stock in violation of any provision of this Agreement shall be
void, and the Company shall not record such Transfer on its books or treat any
purported transferee of such Investor Stock as the owner of such stock for any
purpose.
6C. Severability. Whenever possible, each provision of this Agreement will be
------------
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
6D. Complete Agreement. This Agreement, those documents expressly referred to
------------------
herein and other documents of even date herewith embody the complete agreement
and understanding among the
- 11 -
<PAGE>
parties and supersede and preempt any prior summaries of terms and conditions,
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.
6E. Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Purchaser and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Purchaser, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Purchaser's Stock);
provided that Purchaser may not assign any of its rights under any provision of
- --------
this Agreement except as part of a Transfer of Investor Stock in accordance with
Section 3.
6G. Choice of Law. The corporate law of the State of Delaware will
-------------
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and
construed in accordance with the internal laws of the State of Illinois, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have all rights and
--------
remedies set forth in this Agreement and the Certificate of Incorporation and
all rights and remedies which such holders have been granted at any time under
any other agreement or contract and all of the rights which such holders have
under any law. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically (without posting
a bond or other security), to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law.
- 12 -
<PAGE>
6I. Amendment and Waiver. Except as otherwise expressly provided herein, the
--------------------
provisions of this Agreement may be amended or modified only by written
agreement of the Company, Purchaser and GTCR. No other course of dealing between
the parties or third-party beneficiaries hereof or any delay in exercising any
rights hereunder shall operate as a waiver of any rights of any such holders.
6J. Survival of Representations and Warranties. All representations and
------------------------------------------
warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Purchaser or on its behalf or by the Company or on its
behalf.
6K. Business Days. If any time period for giving notice or taking action
-------------
hereunder expires on a day which is a Saturday, Sunday or holiday in the state
in which the Company's chief executive office is located, the time period shall
be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
6L. Descriptive Headings; Interpretation. The descriptive headings of this
------------------------------------
Agreement are inserted for convenience only and do not constitute a Section of
this Agreement. The use of the word "including" in this Agreement shall be by
way of example rather than by limitation.
* * * * *
- 13 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
THE COINMACH CORPORATION
By /s/ Stephen R. Kerrigan
----------------------------
Its CEO
----------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /s/ Carl D. Thoma
----------------------------
Its: Principal
<PAGE>
JACKSON NATIONAL LIFE
INSURANCE COMPANY
By: /s/ P. B. Pheffer
----------------------------
Its: SR. V.P. & C.F.O.
----------------------------
<PAGE>
EXHIBIT 20
INVESTOR PURCHASE AGREEMENT
---------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation a Delaware corporation (the "Company" ), Jackson National Life
-------
Insurance Company of Michigan (the "Purchaser" ) and Golder, Thoma, Cressey,
---------
Rauner Fund IV, L. P. ( "GTCR" ).
----
The Company and the Purchaser desire to enter into an agreement
pursuant to which the Purchaser will purchase, and the Company will issue, 382
shares of the Company's Class C Common Stock, par value $0.01 per share (the
"Class C Common Stock"). Certain definitions are set forth in Section 5 of
--------------------
this Agreement.
Simultaneously with the execution of this Agreement, (i) each of Heller
Financial, Inc. ("Heller") and Jackson National Life Insurance Company
------
("Jackson" and, together with Heller, the "Lenders") are entering into investor
------- -------
purchase agreements (the "Other Investor Purchase Agreements") substantially
----------------------------------
similar to this Agreement pursuant to which Heller and Jackson will also acquire
shares of the Company's Class C Common Stock and (ii) each of the President and
Fellows of Harvard College ("Harvard"), MCS Capital , Inc . ("MCS "), MCS
------- ---
Capital Management , Inc . ( "MCS Management " ), James N. Chapman
--------------
("Chapman"), Mitchell Blatt ("Blatt") and Michael E. Marrus ("Marrus") are
------- ----- ------
entering into investor purchase agreements substantially similar to this
Agreement pursuant to which Harvard, MCS, MCS Management, Chapman, Blatt and
Marrus will acquire shares of the Company's Class A Common Stock, par value
$0.01 per share (the "Class A Common Stock"). The Heller, Jackson, Harvard,
--------------------
Chapman, Blatt, MCS Management, Marrus and MCS investor purchase agreements are
referred to herein as the "Other Investor Purchase Agreements" and along with
----------------------------------
this Agreement as the "Investor Purchase Agreements."
----------------------------
The execution and delivery of this Agreement by the Company and
Purchaser is a condition to the purchase of 72,516 shares of Class A Common
Stock by GTCR and certain shares of the Company's Class B Common Stock, par
value $0.01 per share (the "Class B Common Stock") by certain members of the
--------------------
Company's management pursuant to purchase agreements between the Company and
each of such Persons dated as of the date hereof (along with the Investor
Purchase Agreements, the "Purchase Agreements"). The
-------------------
<PAGE>
Class A Common Stock, Class B Common Stock, Class C Common Stock and the
Company's Class D Common Stock, par value $0.01 per share (the "Class D Common
--------------
Stock"), are hereinafter collectively referred to as the "Common Stock". Certain
- ----- ------------
provisions of this Agreement are intended for the benefit of, and will be
enforceable by, GTCR.
The parties hereto agree as follows:
Section 1. Authorization and Closing
-------------------------
1A. Authorization of the Stock. The Company shall authorize the
--------------------------
issuance to Purchaser of 382 shares of Class C Common Stock having the rights
set forth in Exhibit A attached hereto.
---------
1B. Purchase and Sale of Investor Stock. At the Closing (as defined
-----------------------------------
in Section 1C below), the Company shall sell to the Purchaser and, subject to
the terms and conditions set forth herein, the Purchaser shall purchase from the
Company 382 shares of the Class C Common at a price of $0. 01 per share.
1C. The Closing. The closing of the purchase and sale of the Stock
-----------
(the "Closing" ) shall take place at the offices of Kirkland & Ellis, 200 East
-------
Randolph Drive, Chicago, Illinois 60601 at 10:00 a.m. on January 31, 1995, or
at such other place or on such other date as may be mutually agreeable to the
Company and the Purchaser. At the Closing, the Company shall deliver to the
Purchaser stock certificates evidencing the Class C Common to be purchased by
the Purchaser, registered in the Purchaser's name, upon payment of the purchase
price thereof by a cashier's or certified check, or by wire transfer of
immediately available funds to such account as designated by the Company in the
amount of $3.82.
Section 2. Representations and Warranties.
------------------------------
2A. Representations and Warranties of Purchaser. In connection with the
-------------------------------------------
issuance of the Investor Stock hereunder, Purchaser represents and warrants to
the Company that, in each case, as of the Closing:
(i) The Class C Common Stock to be acquired by Purchaser pursuant to this
Agreement will be acquired for Purchaser's
- 2 -
<PAGE>
own account and not with a view to, or intention of, distribution thereof in
violation of the Securities Act, or any applicable state securities laws, and
such Class C Common Stock will not be disposed of in contravention of the
Securities Act or any applicable state securities laws.
(ii) Purchaser is able to bear the economic risk of its investment in such
Class C Common Stock for an indefinite period of time, and Purchaser
acknowledges that such Class C Common Stock has not been registered under the
Securities Act and, therefore, cannot be sold unless subsequently registered
under the Securities Act or an exemption from such registration is available.
(iii) Purchaser has had an opportunity to ask questions and receive answers
concerning the terms and conditions of the offering of such Class C Common Stock
and has had full access to such other information concerning the Company as it
has requested.
(iv) This Agreement, the Stockholders Agreement and the Registration Agreement
constitute legal, valid and binding obligations of Purchaser, enforceable in
accordance with their terms, and the execution, delivery and performance of this
Agreement, the Stockholders Agreement and the Registration Agreement by
Purchaser does not and will not conflict with, violate or cause a breach of any
agreement, contract or instrument to which Purchaser is a party or any law,
rule, regulation, judgment, order or decree to which Purchaser is subject.
2B. Representations and Warranties of the Company. In connection with the
---------------------------------------------
issuance of the Investor Stock hereunder, the Company represents to Purchaser
that, in each case, as of the Closing:
(i) Organization and Corporate Power. The Company is a corporation duly
--------------------------------
organized, validly existing and in good standing under the laws of Delaware. The
Company has all requisite corporate power and authority to carry out the
transactions contemplated by this Agreement, the Purchase Agreements, the
Stockholders Agreement and the Registration
- 3 -
<PAGE>
Agreement (the "Investment Agreements"). The copies of the Company's Certificate
---------------------
of Incorporation and Bylaws which have been furnished to Purchaser's counsel
reflect all amendments made thereto at any time prior to the date of this
Agreement and are correct and complete.
(ii) Capital Stock and Related Matters.
---------------------------------
(a) As of the Closing and immediately thereafter, the authorized capital
stock of the Company shall consist of 10,000 shares which will be designated as
Preferred Stock and 108,150 shares of Common Stock, of which 77,350 shares shall
be designated as Class A Common Stock, 15,500 shares shall be designated Class B
Common Stock, 7650 shares shall be designated as Class C Common Stock and 7650
shares shall be designated as Class D Common Stock. As of the Closing, the
Company shall not have outstanding any stock or securities convertible or
exchangeable for any shares of its capital stock or containing any profit
participation features, nor shall it have outstanding any rights or options to
subscribe for or to purchase its capital stock or any stock or securities
convertible into or exchangeable for its capital stock or any stock appreciation
rights or phantom stock plans other than pursuant to and as contemplated by this
Agreement, the Purchase Agreements, the Stockholders Agreement and the Company's
Certificate of Incorporation. As of the Closing, the Company shall not be
subject to any obligation (contingent or otherwise) to repurchase or otherwise
acquire or retire any shares of its capital stock or any warrants, options or
other rights to acquire its capital stock, except pursuant to this Agreement,
the Stockholders Agreement and the Purchase Agreements. As of the Closing, all
of the outstanding shares of the Company's capital stock shall be validly
issued, fully paid and nonassessable.
(b) There are no statutory or contractual stockholders preemptive rights or
rights of refusal with respect to the issuance of the Common Stock hereunder,
except as provided herein and in the Stockholders Agreement. The Company has not
violated any applicable
- 4 -
<PAGE>
federal or state securities laws in connection with the offer, sale or issuance
of any of its capital stock, and the offer, sale and issuance of the Common
Stock pursuant to this Agreement do not and will not require registration under
the Securities Act.
(iii) Conduct of Business; Liabilities. Other than in the course of the
--------------------------------
negotiation, execution and delivery of this Agreement, the Purchase Agreements
and the other agreements contemplated hereby and thereby, prior to the Closing,
the Company has not (i) conducted any business, (ii) incurred any expenses,
obligations or liabilities (whether accrued, absolute, contingent, unliquidated
or otherwise, whether or not known to the Company and whether due or to become
due and regardless of when asserted), (iii) owned any assets, or (iv) entered
into any contracts or agreements.
Section 3. Restrictions on Transfer.
------------------------
3A. Transfer of Investor Stock.
--------------------------
(i) Subject to the restrictions set forth in the remainder of this Section 3,
Investor Stock is transferable only pursuant to (a) a Public Offering registered
under the Securities Act, (b) Rule 144 or Rule 144A of the Securities and
Exchange Commission (or any similar rule or rules then in force) if such rule or
rules are available or (c) subject to the conditions specified in Section 3A
(ii) below, any other legally available means of transfer.
(ii) In connection with the transfer of any Investor Stock (other than a
transfer described in Section 3A(i)(a) or (b) above), the holder thereof shall
deliver written notice to the Company describing in reasonable detail the
transfer or proposed transfer, together with an opinion of counsel which (to the
Company's reasonable satisfaction) is knowledgeable in securities law matters to
the effect that such transfer of Investor Stock may be effected without
registration of such Investor Stock under the Securities Act. In addition, if
the holder of the Investor Stock delivers to the Company an opinion of counsel
that no subsequent transfer of such Investor Stock shall require registration
under the Securities
- 5 -
<PAGE>
Act, the Company shall promptly upon such contemplated transfer deliver new
certificates for such Investor Stock which do not bear the Securities Act legend
set forth in Section 4A hereof. If the Company is not required to deliver new
certificates for such Investor Stock not bearing such legend, the holder thereof
shall not transfer the same until the prospective transferee has confirmed to
the Company in writing its agreement to be bound by the conditions contained in
this Section and Section 4A hereof.
(iii) Upon the request of the Purchaser, the Company shall promptly
supply to the Purchaser or its prospective transferees all information regarding
the Company required to be delivered in connection with a transfer pursuant to
Rule 144A of the Securities and Exchange Commission.
(iv) Any transfer or attempted transfer of any Investor Stock in
violation of any provision of this Agreement shall be void, and the Company
shall not record such transfer on its books or treat any purported transferee of
such Investor Stock as the owner of such Investor Stock for any purpose.
3B. Sale Notice Prior to making any Transfer of Investor Stock,
-----------
Purchaser will give written notice (the "Sale Notice") to the Company and GTCR.
-----------
The Sale Notice will disclose in reasonable detail the number of shares to be
transferred and the terms and conditions of the proposed Transfer and, if known,
the identity of the prospective transferee(s). Purchaser will not consummate any
such Transfer until 60 days after the Sale Notice has been given to the Company
and to GTCR, unless the parties to the Transfer have been fully determined
pursuant to this Section 3B and Section 3C prior to the expiration of such 60-
day period. (The date of the first to occur of such events is referred to herein
as the "Authorization Date.")
------------------
3C. First Refusal Rights. The Company may elect to purchase all (but
--------------------
not less than all) of the shares of Investor Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Purchaser and GTCR within 30 days after the
Sale Notice has been given to the Company. If the Company has not elected to
purchase all of the Investor Stock to be transferred, GTCR may
- 6 -
<PAGE>
elect to purchase all (but not less than all) of the Investor Stock to be
transferred upon the same terms and conditions as those set forth in the Sale
Notice by giving written notice of such election to Purchaser within 60 days
after the Sale Notice has been given to GTCR. If neither the Company nor GTCR
elect to purchase all of the shares of Investor Stock specified in the Sale
Notice, Purchaser may transfer the shares of Investor Stock specified in the
Sale Notice at a price and on terms no more favorable to the transferee(s)
thereof than specified in the Sale Notice during the 180-day period immediately
following the Authorization Date. Any shares of Investor Stock not transferred
within such 180-day period will be subject to the provisions of this Section 3C
upon subsequent transfer.
3D. Transfers in Connection with Transfers of Term Loan C. The provisions of
-----------------------------------------------------
Sections 3B and 3C shall not apply to any Transfer of Investor Stock by
Purchaser to the transferee of a portion of the Term Loan C then held by
Purchaser in an amount not to exceed the product of (i) the number of shares of
Investor Stock purchased by Purchaser hereunder multiplied by (ii) the quotient
-------------
of (a) the amount of Term Loan C transferred by Purchaser to such transferee
divided by (b) the amount of Term Loan C held by Purchaser on the date thereof;
- ----------
provided that such transferee shall agree to be bound by all of the terms and
provisions of this Agreement and the Stockholders Agreement as if it were a
party hereto and thereto.
For purposes of this Section 3D; "Term Loan C" means Term Loan C as
-----------
defined in the Credit Agreement dated as of the date hereof among Coinmach
Industries Co. and Super Laundry Equipment Co., L.P., as borrower, Heller
Financial, Inc. as agent and lender, and Jackson Life Insurance Company and
Jackson Life Insurance Company of Michigan, as lenders, as amended from time to
time.
Section 4. Additional Restrictions on Transfer of Investor Stock.
-----------------------------------------------------
4A. Legend. The Purchaser hereby represents that it is acquiring the Investor
------
Stock purchased hereunder or acquired pursuant hereto for its own account with
the present intention of holding such securities for purposes of investment,
and that it has no intention of selling such securities in a public distribution
in
- 7 -
<PAGE>
violation of the federal securities laws or any applicable state securities
laws; provided that nothing contained herein shall prevent the Purchaser and
subsequent holders of Investor Stock from transferring such securities in
compliance with the provisions of Section 4 hereof. Each certificate for
Investor Stock shall be imprinted with a legend in substantially the following
form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED AS OF
JANUARY 31, 1995, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION
THEREUNDER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO
ADDITIONAL RESTRICTIONS ON TRANSFER AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN
INVESTOR PURCHASE AGREEMENT BETWEEN THE COMPANY AND CERTAIN INVESTORS, DATED AS
OF JANUARY 31, 1995. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER
HEREOF AT THE ISSUER'S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE."
4B. Opinion of Counsel. No holder of Investor Stock may sell, transfer or
------------------
dispose of any Investor Stock (except pursuant to an effective registration
statement under the Securities Act) without first delivering to the Company an
opinion of counsel (reasonably acceptable in form and substance to the Company)
that (i) neither registration nor qualification under the Securities Act and
applicable state securities laws is required in connection with such transfer or
(ii) all such applicable registration and qualification requirements have been
satisfied.
Section 5 Definitions.
-----------
"Investor Stock" means (i) the Class C Common issued hereunder and (ii) any
--------------
Common Stock issued or issuable with respect to the Common Stock referred to in
clause (i) above by way of stock dividends or stock splits or in connection with
a combination of shares, recapitalization, merger, consolidation or other
- 8 -
<PAGE>
reorganization. As to any particular shares of Investor Stock, such shares shall
cease to be Investor Stock when they have been (a) effectively registered under
the Securities Act and disposed of in accordance with the registration statement
covering them or (b) distributed to the public through a broker, dealer or
market maker pursuant to Rule 144 under the Securities Act (or any similar rule
then in force). Whenever any particular securities cease to be Investor Stock,
the holder thereof shall be entitled to receive from the Company, without
expense, new securities of like tenor not bearing a Securities Act legend of the
character set forth in Section 4A.
"Person" means an individual, a partnership, a corporation, an association, a
------
joint stock company, a trust, a joint venture, an unincorporated organization
and a governmental entity or any department, agency or political subdivision
thereof.
"Public Offering" means the sale in an underwritten public offering registered
---------------
under the Securities Act (other than on Form S-8 or a similar or successor form)
of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering under
-----------
the Securities Act or any sale to the public pursuant to Rule 144 promulgated
under the Securities Act effected through a broker, dealer or market maker.
"Registration Agreement" means the Registration Agreement dated as of the date
----------------------
hereof among the Company, the Investors (as defined in that Agreement) and
Purchaser.
"Securities Act" means the Securities Act of 1933, as amended, or any similar
--------------
federal law then in force.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
-----------------------
amended, or any similar federal law then in force.
"Securities and Exchange Commission" includes any governmental body or agency
----------------------------------
succeeding to the functions thereof.
- 9 -
<PAGE>
"Stockholders Agreement" means the Stockholders Agreement dated as of the date
----------------------
hereof among the Company, the Investors (as defined in that Agreement) and
Purchaser.
"Transfer" means to sell, transfer, assign, pledge or otherwise dispose of
--------
(whether with or without consideration and whether voluntarily or involuntarily
or by operation of law) other than pursuant to a Public Sale or Sale of the
Company.
Section 6. Miscellaneous
-------------
6A. Notices. Any notice provided for in this Agreement must be in writing and
-------
must be either personally delivered, mailed by first class mail (postage prepaid
and return receipt requested) or sent by reputable overnight courier service
(charges prepaid) to each person at the address set forth below:
If to the Company:
- -----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a copy (which will not constitute notice to the Company) to:
- ----------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P. C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to the Purchaser:
- -------------------
Jackson National Life Insurance
Company of Michigan
c/o PPM America, Inc.
225 West Wacker Drive, Suite 1200
Chicago, IL 60606 Attention: Private Placements
- 10 -
<PAGE>
With a copy (which will not constitute notice to Purchaser) to:
- ----------------------------------------------------------
Katten Muchin & Zavis
525 West Monroe Street, Suite 1600
Chicago, IL 60661
Attention: Stuart P. Shulruff, Esq.
If to GTCR:
- ----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a Copy (which will not constitute notice to GTCR) to:
- ---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
6B. Transfer in Violation of Agreement. Any Transfer or attempted Transfer
----------------------------------
of any Investor Stock in violation of any provision of this Agreement shall be
void, and the Company shall not record such Transfer on its books or treat any
purported transferee of such Investor Stock as the owner of such stock for any
purpose.
6C. Severability. Whenever possible, each provision of this Agreement will be
------------
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction,
- 11 -
<PAGE>
such invalidity, illegality or unenforceability will not affect any other
provision or any other jurisdiction, but this Agreement will be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.
6D. Complete Agreement. This Agreement, those documents expressly referred to
------------------
herein and other documents of even date herewith embody the complete agreement
and understanding among the parties and supersede and preempt any prior
summaries of terms and conditions, understandings, agreements or representations
by or among the parties, written or oral, which may have related to the subject
matter hereof in any way.
6E. Counterparts. This Agreement may be executed in separate counterparts,
------------
each of which is deemed to be an original and all of which taken together
constitute one and the same agreement.
6F. Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Purchaser and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Purchaser, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Purchaser's Stock);
provided that Purchaser may not assign any of its rights under any provision of
- --------
this Agreement except as part of a Transfer of Investor Stock in accordance
with Section 3.
6G. Choice of Law. The corporate law of the State of Delaware will govern all
-------------
questions concerning the relative rights of the Company and its stockholders.
All other questions concerning the construction, validity and interpretation of
this Agreement and the exhibits hereto will be governed by and construed in
accordance with the internal laws of the State of Illinois, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of Illinois or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Illinois.
6H. Remedies. Each holder of Investor Stock shall have all rights and remedies
--------
set forth in this Agreement and the
- 12 -
<PAGE>
Certificate of Incorporation and all rights and remedies which such holders have
been granted at any time under any other agreement or contract and all of the
rights which such holders have under any law. Any Person having any rights under
any provision of this Agreement shall be entitled to enforce such rights
specifically (without posting a bond or other security), to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law.
6I. Amendment and Waiver. Except as otherwise expressly provided herein, the
--------------------
provisions of this Agreement may be amended or modified only by written
agreement of the Company, Purchaser and GTCR. No other course of dealing
between the parties or third party beneficiaries hereof or any delay in
exercising any rights hereunder shall operate as a waiver of any rights of any
such holders.
6J. Survival of Representations and Warranties. All representations and
------------------------------------------
warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Purchaser or on its behalf or by the Company or on its
behalf.
6K. Business Days. If any time period for giving notice or taking action
-------------
hereunder expires on a day which is a Saturday, Sunday or holiday in the state
in which the Company's chief executive office is located, the time period shall
be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
6L. Descriptive Headings; Interpretation. The descriptive headings of this
------------------------------------
Agreement are inserted for convenience only and do not constitute a Section of
this Agreement. The use of the word "including" in this Agreement shall be by
way of example rather than by limitation.
* * * * *
- 13 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first written above.
THE COINMACH CORPORATION
By /s/ Stephen R. Kerrigan
-------------------------------
Its CEO
------------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By /s/ Carl D. Thoma
-----------------------------
Its: Principal
<PAGE>
JACKSON NATIONAL LIFE
INSURANCE COMPANY OF MICHIGAN
By: /s/ P.B. Pheffer
----------------------
Its: SR. V.P. & C.F.O.
----------------------
<PAGE>
EXHIBIT 23
PROMISSORY NOTE
---------------
$11,666.80 January 31, 1995
For value received, David Tulkop ("Maker") promises to pay to the
order of The Coinmach Corporation, a Delaware corporation (the "Company"), at
its offices in Roslyn, New York, or such other place as designated in writing by
the holder hereof, the aggregate principal sum of $11,666.80. Maker will pay the
aggregate principal sum in four equal payments of $2,916.70 on each of the first
four anniversary dates of the date hereof and, on each such date, Maker will pay
interest accrued through such date at the rate specified below. This Note was
issued pursuant to and is subject to the terms of the Executive Stock Agreement,
dated as of January 31, 1995, between the Company and Maker.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest
rate permitted by applicable law, and shall be payable at such time as the
principal of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 500 shares
of the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ DAVID TULKOP
-----------------------------
David Tulkop
<PAGE>
EXHIBIT 24
PROMISSORY NOTE
---------------
$23,333.60 January 31, 1995
For value received, Robert M. Doyle ("Maker") promises to pay to the
order of The Coinmach Corporation, a Delaware corporation (the "Company"), at
its offices in Roslyn, New York, or such other place as designated in writing by
the holder hereof, the aggregate principal sum of $23,333.60. Maker will pay the
aggregate principal sum in four equal payments of $5,833.40 on each of the first
four anniversary dates of the date hereof and, on each such date, Maker will pay
interest accrued through such date at the rate specified below. This Note was
issued pursuant to and is subject to the terms of the Senior Management
Agreement, dated as of January 31, 1995, between the Company and maker.
Interest will accrue on the outstanding principal amount of this Note at
a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 1,000 shares
of the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ ROBERT M. DOYLE
-----------------------------
Robert M. Doyle
<PAGE>
EXHIBIT 25
PROMISSORY NOTE
---------------
$5,833.40 January 31, 1995
For value received, Russell Harrison ("Maker") promises to pay to the
order of The Coinmach Corporation, a Delaware corporation (the "Company"), at
its offices in Roslyn, New York, or such other place as designated in writing by
the holder hereof, the aggregate principal sum of $5,833.40. Maker will pay the
aggregate principal sum in four equal payments of $1,458.35 on each of the first
four anniversary dates of the date hereof and, on each such date, Maker will pay
interest accrued through such date at the rate specified below. This Note was
issued pursuant to and is subject to the terms of the Executive Stock Agreement,
dated as of January 31, 1995, between the Company and Maker.
Interest will accrue on the outstanding principal amount of this Note at
a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the prinicipal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 250 shares of
the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ RUSSELL HARRISON
--------------------------
Russell Harrison
<PAGE>
EXHIBIT 26
PROMISSORY NOTE
---------------
$17,500.20 January 31, 1995
For value received, Charles Prato ("Maker") promises to pay to the order
of The Coinmach Corporation, a Delaware corporation (the "Company"), at its
offices in Roslyn, New York, or such other place as designated in writing by the
holder hereof, the aggregate principal sum of $17,500.20. Maker will pay the
aggregate principal sum in four equal payments of $4,375.05 on each of the first
four anniversary dates of the date hereof and, on each such date, Maker will pay
interest accrued through such date at the rate specified below. This Note was
issued pursuant to and is subject to the terms of the Executive Stock Agreement,
dated as of January 31, 1995, between the Company and Maker.
Interest will accrue on the outstanding principal amount of this Note at
a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 750 shares of
the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ CHARLES PRATO
----------------------
Charles Prato
<PAGE>
EXHIBIT 27
EXECUTIVE STOCK AGREEMENT
-------------------------
THIS AGREEMENT is made as of January 31, 1995, between The
Coinmach Corporation, a Delaware corporation (the "Company"), Charles
-------
Prato ("Executive") and Golder, Thoma, Cressey, Rauner Fund IV, L.P.
---------
("GTCR").
----
The Company and Executive desire to enter into an agreement
pursuant to which Executive will purchase, and the Company will issue,
750 shares of the Company's Class B Common Stock, par value $0.01 per
share (the "Class B Common Stock"). Certain definitions are set forth
--------------------
in paragraph 8 of this Agreement.
Simultaneously with the execution of this Agreement, David
Tulkop ("Tulkop") and Russell Harrison ("Harrison") are each entering
------ --------
into executive stock agreements (the "Other Executive Stock
---------------------
Agreements") substantially similar to this Agreement pursuant to which
- ----------
Tulkop and Harrison will acquire shares of the Company's Class B
Common Stock, and each of Stephen R. Kerrigan ("Kerrigan"), Mitchell
--------
Blatt ("Blatt") and Robert M. Doyle ("Doyle", and together with
----- -----
Kerrigan, Blatt, Executive, Tulkop and Harrison, "Management" and
----------
individually, a "Manager") are entering into a senior management
-------
agreement (the "Senior Management Agreements") pursuant to which
----------------------------
Kerrigan, Blatt and Doyle will acquire shares of the Company's Class B
Common Stock.
The execution and delivery of this Agreement by the Company
and Executive is a condition to the purchase of 72,516 shares of the
Company's Class A Common Stock, par value $0.01 per share (the "Class
-----
A Common Stock"), by GTCR pursuant to a purchase agreement dated as of
- --------------
the date hereof (the "Purchase Agreement"). The Class A Common Stock
------------------
and Class B Common Stock are hereinafter collectively referred to as
the "Common Stock". Certain provisions of this Agreement are intended
------------
for the benefit of, and will be enforceable by, GTCR.
The parties hereto agree as follows:
<PAGE>
PART I: PROVISIONS RELATING TO EXECUTIVE STOCK
1. Authorization of the Common Stock. The Company shall
---------------------------------
authorize the issuance to Executive of 750 shares of Class B Common
Stock having the rights set forth in Exhibit A attached hereto.
---------
2. Acquisition of Stock.
--------------------
(a) Purchase and Sale of Executive Stock. Upon execution of
------------------------------------
this Agreement, Executive will purchase, and the Company will sell,
750 shares of Class B Common Stock at a price of $29.167 per share.
The Company will deliver to Executive the certificate representing
such Common Stock, and Executive will deliver to the Company a check
or wire transfer of funds in the aggregate amount of $4,375.05, and a
promissory note in the form of Exhibit B attached hereto in the
---------
aggregate amount of $17,500.20 (the "Executive Note"). Executive's
--------------
obligations under the Executive Note will be secured by a pledge of
all of the shares of Executive Stock to the Company and in connection
therewith Executive shall enter into a pledge agreement in the form
of Exhibit C attached hereto.
---------
(b) Section 83(b) Election. Within 30 days after Executive
----------------------
purchases any Executive Stock, Executive will make an effective
election with the Internal Revenue Service under Section 83(b) of the
Internal Revenue Code of 1986, as amended, and the regulations
promulgated thereunder, in the form of Exhibit D attached hereto.
---------
(c) Executive's Representations and Warranties. In
------------------------------------------
connection with the issuance of the Executive Stock hereunder,
Executive represents and warrants to the Company that, in each case,
as of the Closing:
(i) The Class B Common Stock to be acquired by Executive
pursuant to this Agreement will be acquired for Executive's own
account and not with a view to, or intention of, distribution
thereof in violation of the Securities Act, or any applicable
state securities laws, and such Class B Common Stock will not be
disposed of in contravention of the Securities Act or any
applicable state securities laws.
- 2 -
<PAGE>
(ii) Executive has been an executive of Super Laundry
Equipment Co., L.P., a New York limited partnership ("Super
-----
Laundry") which is one of the partnerships to be acquired by the
-------
Company and its Subsidiaries on the date hereof, and Executive is
now an executive of Super Laundry, is sophisticated in financial
matters and is able to evaluate the risks and benefits of the
investment in such Class B Common Stock.
(iii) Executive is able to bear the economic risk of his
investment in such Class B Common Stock for an indefinite period
of time, and Executive acknowledges that such Class B Common
Stock has not been registered under the Securities Act and,
therefore, cannot be sold unless subsequently registered under
the Securities Act or an exemption from such registration is
available.
(iv) Executive has had an opportunity to ask questions and
receive answers concerning the terms and conditions of the
offering of such Class B Common Stock and has had full access to
such other information concerning the Company as he has requested.
(v) This Agreement, the Stockholders Agreement and the
Registration Agreement constitute legal, valid and binding
obligations of Executive, enforceable in accordance with their
terms, and the execution, delivery and performance of this
Agreement, the Other Executive Stock Agreements, the Stockholders
Agreement and the Registration Agreement by Executive does not
and will not conflict with, violate or cause a breach of any
agreement, contract or instrument to which Executive is a party
or any law, rule, regulation, judgment, order or decree to which
Executive is subject.
3. Representations and Warranties of the Company. In
---------------------------------------------
connection with the issuance of the Executive Stock hereunder, the
Company represents to Executive that, in each case, as of the Closing:
(a) Organization and Corporate Power. The Company is a
--------------------------------
corporation duly organized, validly existing and in good standing
under the laws of Delaware. The Company has all requisite corporate
power and authority to carry out the transactions contem-
- 3 -
<PAGE>
plated by this Agreement, the Stockholders Agreement and the Registration
Agreement (the "Investment Agreements"). The copies of the Company's
---------------------
Certificate of Incorporation and Bylaws which have been furnished to
Executive's counsel reflect all amendments made thereto at any time prior
to the date of this Agreement and are correct and complete.
(b) Capital Stock and Related Matters.
---------------------------------
(i) As of the Closing and immediately thereafter, the
authorized capital stock of the Company shall consist of 10,000 shares
which will be designated as Preferred Stock and 108,150 shares of Common
Stock, of which 77,350 shares shall be designated as Class A Common
Stock, 15,500 shares shall be designated Class B Common Stock, 7650
shares shall be designated as Class C Common Stock and 7650 shares shall
be designated as Class D Common Stock. As of the Closing, the Company
shall not have outstanding any stock or securities convertible or
exchangeable for any shares of its capital stock or containing any profit
participation features, nor shall it have outstanding any rights or
options to subscribe for or to purchase its capital stock or any stock or
securities convertible into or exchangeable for its capital stock or any
stock appreciation rights or phantom stock plans other than pursuant to
and as contemplated by this Agreement, the Senior Management Agreements,
the Other Executive Stock Agreements, the Purchase Agreement, the
Stockholders Agreement and the Company's Articles of Incorporation. As of
the Closing, the Company shall not be subject to any obligation
(contingent or otherwise) to repurchase or otherwise acquire or retire
any shares of its capital stock or any warrants, options or other rights
to acquire its capital stock, except pursuant to this Agreement, the
Senior Management Agreements, the Other Executive Stock Agreements, the
Purchase Agreement and the Stockholders Agreement. As of the Closing, all
of the outstanding shares of the Company's capital stock shall be validly
issued, fully paid and nonassessable.
(ii) There are no statutory or contractual stockholders
preemptive rights or rights of refusal with respect to the issuance of
the Common Stock hereunder, except as provided herein and in the
Stockholders Agreement. The Company has not violated any applicable
federal or state securities laws in connection with the offer, sale or
issuance of any of its capital stock, and the offer, sale and issuance of
the Common Stock pursuant to this
- 4 -
<PAGE>
Agreement do not and will not require registration under the
Securities Act.
(c) Conduct of Business; Liabilities. Other than in the
--------------------------------
course of the negotiation, execution and delivery of this Agreement,
the Senior Management Agreements, the Other Executive Stock
Agreements, the Purchase Agreement and the other agreements
contemplated hereby and thereby, prior to the Closing, the Company has
not (i) conducted any business, (ii) incurred any expenses,
obligations or liabilities (whether accrued, absolute, contingent,
unliquidated or otherwise, whether or not known to the Company and
whether due or to become due and regardless of when asserted), (iii)
owned any assets, or (iv) entered into any contracts or agreements.
4. Vesting of Executive Stock.
--------------------------
(a) Except as otherwise provided in paragraph 4(b) below,
20% of the Executive Stock will be deemed "Vested Shares" as of the
date of Closing and the remainder of the Executive Stock will become
vested in accordance with the following schedule, if as of each such
date Executive is still employed by the Company or any
of its Subsidiaries:
Cumulative
Anniversary of Percentage of Executive
the Date of Closing Stock Vested
------------------- -----------------------
1st 40
2nd 60
3rd 80
4th 100
Any shares of Executive Stock which do not become Vested Shares
under the foregoing provisions will remain "Unvested Shares."
(b) If Executive ceases to be employed by the Company
and its Subsidiaries on any date other than any anniversary date,
the cumulative percentage of Executive Stock to become vested will
be determined on a pro-rata basis according to the number of days
elapsed since the prior anniversary date. Immediately prior to the
- 5 -
<PAGE>
closing of (i) any sale of the Company's equity securities which results in any
person, or group of related persons not affiliated with GTCR, owning equity
securities of the Company possessing the power to elect (without reference to
any special or default voting rights) a majority of the members of the Board or
(ii) a sale of all or substantially all of the Company's assets, all Unvested
Shares will become Vested Shares.
5. Repurchase Option.
-----------------
(a) In the event Executive violates Paragraph 10(a) of this Agreement
(a "Noncompete Breach"), or in the event Executive's employment by the Company
-----------------
and its Subsidiaries terminates for any reason (a "Termination"), the Executive
-----------
Call Stock (whether held by Executive or one or more of Executive's transferees,
other than the Company or GTCR) will be subject to repurchase by the Company
first, Management second and GTCR third pursuant to the terms and conditions set
forth in this paragraph 5 (the "Repurchase Option").
-----------------
(b) If the Repurchase Option becomes exercisable because of a
Noncompete Breach or a Termination resulting from the Company's termination of
Executive's employment for Cause, then, the purchase price for each share of
----
Executive Call Stock will be the lower of (a) Executive's Original Cost for such
share or (b) the Fair Market Value of such share. If Executive's employment
terminates other than as described in the preceding sentence, the purchase price
for each (i) Unvested Share shall be Executive's Original Cost for such share,
and (ii) Vested Share shall be the Fair Market Value of such share as of the
date of the related Repurchase Notice or Investor Notice (as hereinafter
defined), as the case may be.
(c) The Company may, at the option of the Board, elect to purchase all
or any portion of the Executive Call Stock from time to time by delivering
written notice (the "Repurchase Notice") to Management, GTCR and the holder or
-----------------
holders of such Executive Call Stock from time to time during the 270 days after
the Noncompete Breach or Termination, as the case may be. The Repurchase Notice
will set forth the number of shares of Executive Call Stock, including the
number of Unvested Shares and Vested Shares, to be acquired from the recipient
holder, the aggregate consideration to be paid for such shares and the time and
place for the closing of the transaction.
- 6 -
<PAGE>
(d) If for any reason the Company has not elected to
purchase all of the Executive Call Stock pursuant to the Repurchase
Option, Management shall be entitled to exercise the Repurchase Option
for any or all of the shares of Executive Call Stock, including the
Unvested Shares and the Vested Shares, the Company has not yet elected
to purchase (the "Available Shares"), by giving written notice to the
----------------
Company and the holder(s) of the Available Shares to be repurchased
during the 30 days after the date of delivery to Management of the
Repurchase Notice (the "Management Notice") setting forth the number
-----------------
of Available Shares each Manager is willing to purchase. If the
Managers elect to purchase an aggregate number of shares greater than
the number of Available Shares, the Available Shares shall be
allocated among the Managers pro rata based on the number of shares of
Common Stock owned by each Manager. As soon as practicable, and in any
event, within 10 days after the expiration of the 30-day period set
forth above, the Company shall notify the holder(s) of the Available
Shares and GTCR as to the number of shares being purchased from such
holder(s) by Management (the "Supplemental Repurchase Notice"). At the
------------------------------
time the Company delivers the Supplemental Repurchase Notice to the
holder(s) of the Available Shares, the Company shall also deliver
written notice to each Manager and GTCR setting forth the number of
shares such Manager is entitled to purchase, the aggregate purchase
price and the time and place of the closing of the transaction and, in
the notice to GTCR, a statement of the number, type and purchase price
of Available Shares available for purchase by GTCR.
(e) If for any reason Management has not elected to purchase
any or all of the Available Shares pursuant to paragraph 5(d) above,
GTCR may elect to purchase any or all of the Available Shares not
purchased by Management by giving written notice to the holder(s) of
the Available Shares to be repurchased within 30 days after the date
of delivery to GTCR of the Supplemental Repurchase Notice (the
"Investor Repurchase Notice") setting forth the number of Available
- ---------------------------
Shares GTCR is willing to purchase.
(f) Each closing of the purchase of the Executive Call Stock
pursuant to the Repurchase Option shall take place on the date
designated by the Company, Management or GTCR in the related
Repurchase Notice, Supplemental Repurchase Notice, or Investor
Repurchase Notice, as the case may be, but in any event not later than
365 days after the date of the Noncompete Breach or Termination. At
such closing, Executive shall deliver to the
- 7 -
<PAGE>
Company, Management and/or GTCR certificates representing the
Executive Stock to be repurchased by the Company, Management and/or
GTCR and the Company, Management and/or GTCR, as the case may be, will
pay for the Executive Call Stock to be purchased pursuant to the
Repurchase Option in the following manner:
(i) In the event that no Event of Default has occurred and
is continuing on the date of the Noncompete Breach or
Termination, payment for the Executive Call Stock to be purchased
shall be made by delivery to Executive of a cashier's or
certified check or wire transfer of funds in the amount of one-
half of the purchase price of the Executive Call Stock on the
date of the closing of the Repurchase Option. Payment for the
remaining one-half of the purchase price shall be made by
delivery of a promissory note of the purchaser, with an aggregate
principal amount equal to one-half of the purchase price of the
Executive Stock to be repurchased, payable in one lump sum
payment on the second anniversary of the date of issuance and
bearing interest at the rate of 8% per annum.
(ii) In the event that an Event of Default has occurred and
is continuing on the date of the Noncompete Breach or
Termination, payment for the Executive Call Stock to be purchased
shall be made by delivery of a promissory note of the purchaser,
with an aggregate principal amount equal to the total purchase
price of the Executive Call Stock to be repurchased, payable in
one lump sum payment on the fifth anniversary of the date of
issuance and bearing interest at the rate of 8% per annum
Any such note issued by the Company pursuant to subparagraphs (i) and
(ii) above shall be junior and subordinated in right of payment to all
indebtedness of the Company (for borrowed money or otherwise). In
addition, the Company may pay the total purchase price for such shares
by offsetting amounts outstanding under any bona fide debts owed by
Executive to the Company. The Company, Management and GTCR will be
entitled to receive customary representations and warranties from the
sellers regarding such sale and to require that all sellers'
signatures be guaranteed.
(g) If within six months following the repurchase of
Executive Call Stock pursuant to paragraph 5(f) above, (i) a Sale
- 8 -
<PAGE>
of the Company or a Public Offering of the Company's Common Stock
registered under the Securities Act occurs and (ii) the valuation of a
share of Common Stock for such transaction (based upon the purchase
price or liquidation proceeds per share of Common Stock or the Public
Offering price per share of Common Stock, but reduced by any
preferential amounts available to any of the classes of Common Stock)
exceeds the amounts per share received by the holder(s) of Executive
Call Stock upon the repurchase of Vested Shares, then such holder(s)
of Executive Call Stock shall be entitled to receive from the Company
the benefit of such higher valuation for the Vested Shares of
Executive Call Stock sold under the Repurchase Option. The excess of
(x) the amount which the holder(s) of Executive Call Stock would have
received in such Sale of the Company or Public Offering assuming the
sale of their Vested Shares of Executive Call Stock purchased by
exercise of the Repurchase Option in connection with such transaction,
over (y) the purchase price of the Vested Shares of Executive Call
Stock paid to Executive under the Repurchase Option, shall be paid by
certified check or cashier's check or wire transfer of funds to each
such holder upon consummation of any such transaction. For purposes of
this paragraph 5(g), "Sale" means the sale of all or substantially all
of the assets of the Company or a sale of the Company's equity
securities which results in any person, or group of related persons,
owning equity securities of the Company possessing the power to elect
(without reference to any special or default voting rights) a majority
of the members of the Board, including any such sale accomplished by
merger or consolidation.
6. Restrictions on Transfer.
------------------------
(a) Transfer of Executive Stock. On or prior to the
---------------------------
Restriction Lapse Date, Executive shall not transfer any interest in
any shares of Executive Stock (a "Transfer"), except pursuant to the
--------
provisions of paragraph 5 or 6(e) of this Agreement. After the
Restriction Lapse date, Executive shall not Transfer any interest in
any shares of Executive stock except (i) pursuant to the provisions of
paragraph 5 or 6(e) of this Agreement, (ii) in a Public Sale or (iii)
pursuant to the provisions of paragraphs 6(b), 6(c) and 6(d) of this
Agreement. Prior to effecting any Transfer of Executive Stock (other
than to the Company, Management or GTCR), Executive shall obtain from
each transferee their written agreement to be bound by the provisions
of paragraph 6 of this Agreement for the benefit of the Company,
Management and GTCR.
- 9 -
<PAGE>
(b) Sale Notice After the Restriction Lapse Date,
-----------
prior to making any Transfer, Executive will give written notice
(the "Sale Notice") to the company, each manager and GTCR. The
-----------
Sale Notice will disclose in reasonable detail the number of shares
to be transferred and the terms and conditions of the proposed
Transfer and, if known, the identity of the prospective
transferee(s). Executive will not consummate any such Transfer
until 90 days after the Sale Notice has been given to the Company,
Management and GTCR, unless the parties to the Transfer have been
fully determined pursuant to this paragraph 6(b) and paragraphs
6(c) and 6(d) prior to the expiration of such 90-day period. (The
date of the first to occur of such events is referred to herein as
the "Authorization Date.")
------------------
(c) First Refusal Rights. The Company may elect to
---------------------
purchase all (but not less than all) of the shares of Executive
Stock to be transferred upon the same terms and conditions as those
set forth in the Sale Notice by delivering a written notice of such
election to Executive, each Manager and GTCR within 30 days after
the Sale Notice has been given to the Company. If the Company has
not elected to purchase all of the Executive Stock to be
transferred, Management may elect to purchase all (but not less
than all) of the Executive Stock to be transferred upon the same
terms and conditions as those set forth in the Sale Notice by
giving written notice of such election to Executive, the Company
and GTCR within 60 days after the Sale Notice has been given to
Management. Management's rights hereunder shall be allocated among
the Managers pro rata based on the number of shares of Common Stock
owned by each Manager. If the Company and Management have not
elected to purchase all of the Executive Stock to be transferred,
GTCR may elect to purchase all (but not less than all) of the
Executive Stock to be transferred upon the same terms and
conditions as those set forth in the Sale Notice by giving written
notice of such election to Executive, the Company and each Manager
within 90 days after the Sale Notice has been given to GTCR. If,
the Company, Management or GTCR do not elect to purchase all of the
shares of Executive Stock specified in the Sale Notice, Executive
may transfer the shares of Executive Stock specified in the Sale
Notice at a price and on terms no more favorable to the
transferee(s) thereof than specified in the Sale Notice during the
30-day period immediately following the Authorization Date. Any
shares of Executive Stock not transferred within such 30-day period
- 10 -
<PAGE>
will be subject to the provisions of this paragraph 6(c) upon subsequent
transfer.
(d) Co-Sale Rights.
--------------
(i) GTCR may elect to participate in the contemplated Transfer
by delivering written notice to Executive within 90 days after
delivery of the Sale Notice to GTCR. If GTCR has elected to
participate in such Transfer, Executive and GTCR shall be entitled
to sell in the contemplated Transfer, on the same terms and at the
price calculated pursuant to subparagraph 6(d)(ii) below, a number
of shares equal to the product of (x) the quotient determined by
dividing the number of shares of Common Stock owned by such person
by the aggregate number of shares of Common Stock owned by Executive
and GTCR and (y) the number of shares to be sold in the contemplated
Transfer.
For example, if the Sale Notice contemplated a sale of 100 shares by
-----------
Executive, and if Executive was at such time the owner of 30% of the
Company's Common Stock (on a fully-diluted basis) and if GTCR elected
to participate and GTCR owned 20% of the Company's Common Stock (on a
fully-diluted basis), Executive would be entitled to sell 60 shares
(30% / 50% x 100 shares) and GTCR would be entitled to sell 40 shares
(20% / 50% x 100 shares).
Executive will use his best efforts to obtain the agreement of the
prospective transferee(s) to the participation of GTCR in the
contemplated transfer and will not transfer any Executive Stock to
the prospective transferee(s) if such transferee(s) refuses to allow
the participation of GTCR.
(ii) The purchase price to be paid by any transferee for shares
of Class B Common and Class A Common transferred in accordance with
this paragraph 6(d) shall be determined as follows: (i) the price
per share to be paid for Class B Common included in such Transfer
shall be equal to the amount per share of Class B Common which such
transferee has agreed to pay to Executive and (ii) the price per
share to be paid for Class A Common included in such Transfer shall
be the price per share described in clause (i) plus the quotient
----
(the "Per Share Preference") of (A) the sum of the Unreturned
--------------------
Preferred
- 11 -
<PAGE>
Amount and the Unpaid Yield of the Class A Common at such time divided by
----------
(B) the number of shares of Class A Common then outstanding.
(e) Permitted Transfers. The restrictions contained in this paragraph
-------------------
6 shall not apply with respect to any Transfer of Executive Stock pursuant to
applicable laws of descent and distribution or among such Executive and such
Executive's Family Members; provided that such restrictions will continue to be
applicable to the Executive Stock after any such transfer and the transferees of
such Executive Stock have agreed in writing to be bound by the provisions of
this Agreement.
(f) Pledges. Notwithstanding the provisions of this paragraph 6,
-------
Executive may pledge any shares of Executive Stock to the Company to secure
payment of the Executive Note.
7. Additional Restrictions on Transfer of Executive Stock.
------------------------------------------------------
(a) Legend. The certificates representing the Executive Stock will
------
bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE
ORIGINALLY ISSUED AS OF JANUARY 31, 1995, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN
EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO
ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE
OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN
EXECUTIVE STOCK AGREEMENT BETWEEN THE COMPANY, AN EXECUTIVE
OF THE COMPANY, AND A CERTAIN INVESTOR, DATED AS OF JANUARY
31, 1995. A COPY OF SUCH AGREEMENT MAY BE OBTAINED BY THE
HOLDER HEREOF AT THE ISSUER'S PRINCIPAL PLACE OF BUSINESS
WITHOUT CHARGE."
- 12 -
<PAGE>
(b) Opinion of Counsel. No holder of Executive Stock may sell,
------------------
transfer or dispose of any Executive Stock (except pursuant to an
effective registration statement under the Securities Act) without first
delivering to the Company an opinion of counsel (reasonably acceptable in
form and substance to the Company) that (i) neither registration nor
qualification under the Securities Act and applicable state securities
laws is required in connection with such transfer or (ii) all such
applicable registration and qualification requirements have been
satisfied.
- 13 -
<PAGE>
PART II: GENERAL PROVISIONS
8. Definitions.
-----------
"Acquisition Agreement" means the agreement by and among the
---------------------
Company, CIC, the stockholders of CIC and the Subsidiary, dated as of
January 31, 1995.
"Cause" means (i) a material breach of any agreement with the
-----
Company, its Subsidiaries or its stockholders by Executive (after notice
and reasonable opportunity to cure), (ii) a breach of Executive's duty of
loyalty to the Company or any of its Subsidiaries or any act of
dishonesty, gross negligence, willful misconduct or fraud with respect to
the Company or any of its Subsidiaries or any of their stockholders,
customers or suppliers, (iii) the commission by Executive of a felony, a
crime involving moral turpitude or other act or omission tending to cause
harm to the standing and reputation of, or otherwise bring public
disgrace or disrepute to, the Company or any of its Subsidiaries, (iv)
Executive's continued failure or refusal to perform any material duty to
the Company or any of its Subsidiaries which is normally attached to his
position (after notice and reasonable opportunity to cure) or (v)
Executive's gross negligence or willful misconduct in performing those
duties which are normally attached to his position (after notice and
reasonable opportunity to cure). For purposes of this Agreement,
"Executive's duty of loyalty to the Company or any of its Subsidiaries"
shall include the Executive's fiduciary obligation to place the interests
of the Company and its Subsidiaries ahead of his personal interests and
thereby not knowingly profit personally at the expense of the Company or
any of its Subsidiaries, and shall also include specifically the
affirmative obligation to disclose promptly to the Board any known
conflicts of interest Executive may have with respect to the Company and
its Subsidiaries, and the negative obligations not to usurp corporate
opportunities of the Company or any of its Subsidiaries, not to engage in
any "conflict-of-interest" transactions with the Company or its
Subsidiaries (without the approval of the board directors), and not to
compete directly with the Company or its Subsidiaries (without the
approval of the Board).
"Event of Default" means Event of Default as defined in the
----------------
Credit Agreement, dated as of the date hereof, among Coinmach
- 14 -
<PAGE>
Industries Co., Super Laundry Equipment Co., L.P., Heller Financial, Inc.,
Jackson National Life Insurance Company and Jackson National Life Insurance
Company of Michigan and any similar term in any replacement for, refinancing of,
or modification or amendment to, such Credit Agreement.
"Executive Call Stock" means at any time (i) all equity securities of
--------------------
the Company then held by Executive or a Family Member, (ii) all equity
securities of the Company which at any time have been held by Executive (whether
or not then held by Executive), and (iii) all equity securities of the Company
issued or issuable directly or indirectly with respect to any equity securities
described in clause (i) or (ii) above in connection with a combination of
shares, dividend, recapitalization, merger, consolidation, reorganization or
otherwise; provided that any equity securities which had been Executive Call
--------
Stock and which have been transferred in accordance with the terms of this
Agreement will not be Executive Call Stock at any subsequent time unless held at
the time of determination by Executive or a Family Member.
"Executive Stock" means the shares of the Company's Class B Common
---------------
Stock purchased hereunder.
"Fair Market Value" of each share of Common Stock constituting
-----------------
Executive Stock at the time of valuation means Fair Market Value as defined in
the Stockholders Agreement, except that Operating Cash Flow will be determined
based upon the twelve (12) month period ending on the fiscal quarter end
immediately preceding the date of Termination or of the Noncompete Breach, as
the case may be.
"Family Members" means Executive's spouse and/or lineal descendants, a
--------------
trust for the sole benefit of Executive and/or Executive's spouse or lineal
descendants or upon Executive's death, Executive's estate.
"IRC" means the Internal Revenue Code of 1986, as amended, and any
---
reference to any particular IRC section shall be interpreted to include any
revision of or successor to that section regardless of how numbered or
classified.
- 15 -
<PAGE>
"Original Cost" of each share of Class B Common Stock
-------------
purchased hereunder will be equal to $29.167 (as proportionately
adjusted for all subsequent stock splits, stock dividends and other
recapitalizations).
"Public Offering" means the sale in an underwritten public
---------------
offering registered under the Securities Act (other than on Form S-8
or a similar or successor form) of shares of the Company's Common
Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public
-----------
Offering under the Securities Act or any sale to the public pursuant
to Rule 144 promulgated under the Securities Act effected through a
broker, dealer or market maker.
"Registration Agreement" means the Registration Agreement
----------------------
dated as of the date hereof among the Company, the Investors (as
defined in that Agreement) and Executive.
"Restriction Lapse Date" means the earlier of (i) the fifth
----------------------
anniversary of the date of this Agreement and (ii) the date of the
closing of any Public Offering.
"Securities Act" means the Securities Act of 1933, as
--------------
amended from time to time.
"Securities Exchange Act" means the Securities Exchange Act
-----------------------
of 1934, as amended from time to time.
"Stockholders Agreement" means the Stockholders Agreement
-----------------------
dated as of the date hereof among the Company, the Investors (as
defined in that Agreement) and Executive.
"Subsidiary" means, with respect to any Person, any
----------
corporation, partnership, association or other business entity of
which (i) if a corporation, a majority of the total voting power of
shares of stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or
trustees thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of
that Person or a combination thereof, or (ii) if a partnership,
association or other business entity, a majority of the partnership or
other similar ownership interest thereof is at the time owned or
- 16 -
<PAGE>
controlled, directly or indirectly, by any Person or one or more Subsidiaries of
that Person or a combination thereof. For purposes hereof, a Person or Persons
shall be deemed to have a majority ownership interest in a partnership,
association or other business entity if such Person or Persons shall be
allocated a majority of partnership, association or other business entity gains
or losses or shall be or control the managing director or general partner of
such partnership, association or other business entity.
"Transfer" means to sell, transfer, assign, pledge or otherwise
--------
dispose of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law).
"Unreturned Preferred Amount" means the "Unreturned Preferred Amount"
---------------------------
as defined in the Company's Certificate of Incorporation.
"Unpaid Yield" means the "Unpaid Yield" as defined in the Company's
------------
Certificate of Incorporation.
9. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a copy (which will constitute notice to the Company) to:
------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
- 17 -
<PAGE>
If to the Executive:
-------------------
Charles Prato
c/o The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
With a copy (which will not constitute notice to Executive) to:
--------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as
the recipient party shall have specified by prior written notice to
the sending party. Any notice under this Agreement will be deemed
to have been given when so delivered or sent or, if mailed, five
days after deposit in the U.S. mail.
10. General Provisions.
------------------
(a) Transfers in Violation of Agreement. Any Transfer
------------------------------------
or attempted Transfer of any Executive Stock in violation of any
provision of this Agreement shall be void, and the Company shall
not record such Transfer on its books or treat any purported
- 18 -
<PAGE>
transferee of such Executive Stock as the owner of such stock for any
purpose.
(b) Severability. Whenever possible, each provision of this
------------
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement is
held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability will not affect any other provision or
any other jurisdiction, but this agreement will be reformed, construed
and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision had never been contained herein.
(c) Complete Agreement. This Agreement, those documents
-------------------
expressly referred to herein and other documents of even date herewith
(i) embody the complete agreement and understanding among the parties
and (ii) supersede and preempt any prior summaries of terms and
conditions, understandings, agreements or representations by or among
the parties, written or oral, which may have related to the subject
matter hereof in any way.
(d) Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of
which taken together constitute one and the same agreement.
(e) Successors and Assigns. Except as otherwise provided
----------------------
herein, this Agreement shall bind Executive and the Company and their
respective successors and permitted assigns and inure to the benefit
of and be enforceable by Executive, the Company, GTCR and their
respective successors and permitted assigns (including in each case
subsequent holders of Executive Stock); provided that Executive may
--------
not assign any of his rights under any other provision of Part I of
this Agreement except as part of a Transfer of Executive Stock in
accordance with paragraphs 5 or 6.
(f) Choice of Law. The corporate law of the State of
-------------
Delaware will govern all questions concerning the relative rights of
the Company and its stockholders. All other questions concerning the
construction, validity and interpretation of this Agreement and the
exhibits hereto will be governed by and construed in accordance with
the internal laws of the State of Illinois,
- 19 -
<PAGE>
without giving effect to any choice of law or conflict of law
provision or rule (whether of the State of Illinois or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Illinois.
(g) Remedies. Each of the parties to this Agreement will be
--------
entitled to enforce its rights under this Agreement specifically, to
recover damages and costs (including attorney's fees) caused by any
breach of any provision of this Agreement and to exercise all other
rights existing in its favor. The parties hereto agree and acknowledge
that money damages may not be an adequate remedy for any breach of the
provisions of this Agreement and, except as otherwise provided in
paragraph 10(d), that any party may in its sole discretion apply to
any court of law or equity of competent jurisdiction (without posting
any bond or deposit) for specific performance and/or other injunctive
relief in order to enforce or prevent any violations of the provisions
of this Agreement.
(h) Amendment and Waiver. Except as otherwise expressly
--------------------
provided herein, the provisions of this Agreement may be amended or
modified only by written agreement of the Company, Executive and GTCR.
No other course of dealing between the parties or third-party
beneficiaries hereof or any delay in exercising any rights hereunder
shall operate as a waiver of any rights of any such holders.
(i) Survival of Representations and Warranties. All
------------------------------------------
representations and warranties contained herein or made in writing by
any party in connection herewith shall survive the execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby, regardless of any investigation made by Executive
or on his behalf or by the Company or on its behalf.
(j) Business Days. If any time period for giving notice or
-------------
taking action hereunder expires on a day which is a Saturday, Sunday
or holiday in the state in which the Company's chief executive office
is located, the time period shall be automatically extended to the
business day immediately following such Saturday, Sunday or holiday.
(k) Descriptive Headings; Interpretation. The descriptive
-------------------------------------
headings of this Agreement are inserted for convenience only
- 20 -
<PAGE>
and do not constitute a Section of this Agreement. The use of the word
"including" in this Agreement shall be by way of example rather than
by limitation.
* * * * *
- 21 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date first written above.
THE COINMACH CORPORATION
By /s/ ROBERT M. DOYLE
--------------------------
Its Vice President
--------------------------
GOLDER, THOMAS, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thomas, Cressey,
Rauner, Inc.
Its: General Partner
By: /s/ CARL D. THOMAS
------------------------
Its: Principal
EXECUTIVE
/s/ CHARLES PRATO
-------------------------------
Charles Prato
- 22 -
<PAGE>
CONSENT
-------
The undersigned spouse of Executive hereby acknowledges that
I have read the foregoing Executive Stock Agreement and that I
understand its contents. I am aware that the Agreement provides for
the repurchase of my spouse's shares of Common Stock under certain
circumstances and imposes other restrictions on the transfer of such
Common Stock. I agree that my spouse's interest in the common stock
subject to this Agreement and any interest I may have in such Common
Stock shall be irrevocably bound by this Agreement and further that
my community or marital property interest, if any, shall be similarly
bound by this Agreement.
/s/ MARGARITA PRATO
--------------------------------
Spouses's Name: Margarita Prato
/s/ ANTHONY J. VARAJAO
--------------------------------
Witness
<PAGE>
EXHIBIT 28
EXECUTIVE STOCK AGREEMENT
-------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"), Russell Harrison
-------
("Executive") and Golder, Thoma, Cressey, Rauner Fund IV, L.P. ("GTCR").
--------- ----
The Company and Executive desire to enter into an agreement pursuant
to which Executive will purchase, and the Company will issue, 250 shares of the
Company's Class B Common Stock, par value $0.01 per share (the "Class B Common
--------------
Stock"). Certain definitions are set forth in paragraph 8 of this Agreement.
- -----
Simultaneously with the execution of this Agreement, David Tulkop
("Tulkop") and Charles Prato ("Prato") are each entering into executive stock
------ -----
agreements (the "Other Executive Stock Agreements") substantially similar to
--------------------------------
this Agreement pursuant to which Tulkop and Prato will acquire shares of the
Company's Class B Common Stock, and each of Stephen R. Kerrigan ("Kerrigan"),
--------
Mitchell Blatt ("Blatt") and Robert M. Doyle ("Doyle", and together with
----- -----
Kerrigan, Blatt, Executive, Tulkop and Prato "Management" and individually, a
----------
"Manager") are entering into a senior management agreement (the "Senior
------- ------
Management Agreements") pursuant to which Kerrigan, Blatt and Doyle will acquire
- ---------------------
shares of the Company's Class B Common Stock.
The execution and delivery of this Agreement by the Company and
Executive is a condition to the purchase of 72,516 shares of the Company's Class
A Common Stock, par value $0.01 per share (the "Class A Common Stock"), by
--------------------
GTCR pursuant to a purchase agreement dated as of the date hereof (the "Purchase
--------
Agreement"). The Class A Common Stock and Class B Common Stock are hereinafter
- ---------
collectively referred to as the "Common Stock". Certain provisions of this
------------
Agreement are intended for the benefit of, and will be enforceable by, GTCR.
The parties hereto agree as follows:
<PAGE>
PART I: PROVISIONS RELATING TO EXECUTIVE STOCK
1. Authorization of the Common Stock. The Company shall authorize the
---------------------------------
issuance to Executive of 250 shares of Class B Common Stock having the rights
set forth in Exhibit A attached hereto.
---------
2. Acquisition of Stock.
---------------------
(a) Purchase and Sale of Executive Stock. Upon execution of this
------------------------------------
Agreement, Executive will purchase, and the Company will sell, 250 shares of
Class B Common Stock at a price of $29.167 per share. The Company will deliver
to Executive the certificate representing such Common Stock, and Executive will
deliver to the Company a check or wire transfer of funds in the aggregate amount
of $1,458.35, and a promissory note in the form of Exhibit B attached hereto in
---------
the aggregate amount of $5,833.40 (the "Executive Note"). Executive's
--------------
obligations under the Executive Note will be secured by a pledge of all of the
shares of Executive Stock to the Company and in connection therewith Executive
shall enter into a pledge agreement in the form of Exhibit C attached
---------
hereto.
(b) Section 83(b) Election. Within 30 days after Executive purchases
----------------------
any Executive Stock, Executive will make an effective election with the Internal
Revenue Service under Section 83(b) of the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder in the form of Exhibit D
---------
attached hereto.
(c) Executive's Representations and Warranties. In connection with the
------------------------------------------
issuance of the Executive Stock hereunder, Executive represents and warrants to
the Company that, in each case, as of the Closing:
(i) The Class B Common Stock to be acquired by Executive pursuant to
this Agreement will be acquired for Executive's own account and not with a view
to, or intention of, distribution thereof in violation of the Securities Act, or
any applicable state securities laws, and such Class B Common Stock will not be
disposed of in contravention of the Securities Act or any applicable state
securities laws.
-2-
<PAGE>
(ii) Executive has been an executive of Coinmach Industries Co., L.P.,
a New York limited partnership and one of the partnerships to be acquired by
the Company and its Subsidiaries on the date hereof, and Executive is now an
executive of Coinmach, is sophisticated in financial matters and is able to
evaluate the risks and benefits of the investment in such Class B Common Stock.
(iii) Executive is able to bear the economic risk of his investment in
such Class B Common Stock for an indefinite period of time, and Executive
acknowledges that such Class B Common Stock has not been registered under the
Securities Act and, therefore, cannot be sold unless subsequently registered
under the Securities Act or an exemption from such registration is available.
(iv) Executive has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of such Class B
Common Stock and has had full access to such other information concerning the
Company as he has requested.
(v) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Executive,
enforceable in accordance with their terms, and the execution, delivery and
performance of this Agreement, the Other Executive Stock Agreements, the
Stockholders Agreement and the Registration Agreement by Executive does not and
will not conflict with, violate or cause a breach of any agreement, contract or
instrument to which Executive is a party or any law, rule, regulation, judgment,
order or decree to which Executive is subject.
3. Representations and Warranties of the Company. In connection with
---------------------------------------------
the issuance of the Executive Stock hereunder, the Company represents to
Executive that, in each case, as of the Closing:
(a) Organization and Corporate Power. The Company is a corporation duly
--------------------------------
organized, validly existing and in good standing under the laws of Delaware. The
Company has all requisite corporate power and authority to carry out the
transactions contem-
-3-
<PAGE>
plated by this Agreement, the Stockholders Agreement and the Registration
Agreement (the "Investment Agreements"). The copies of the Company's Certificate
---------------------
of Incorporation and Bylaws which have been furnished to Executive's counsel
reflect all amendments made thereto at any time prior to the date of this
Agreement and are correct and complete.
(b) Capital Stock and Related Matters.
---------------------------------
(i) As of the Closing and immediately thereafter, the authorized
capital stock of the Company shall consist of 10,000 shares which will be
designated as Preferred Stock and 108,150 shares of Common Stock, of which
77,350 shares shall be designated as Class A Common Stock, 15,500 shares shall
be designated Class B Common Stock, 7650 shares shall be designated as Class C
Common Stock and 7650 shares shall be designated as Class D Common Stock. As of
the Closing, the Company shall not have outstanding any stock or securities
convertible or exchangeable for any shares of its capital stock or containing
any profit participation features, nor shall it have outstanding any rights or
options to subscribe for or to purchase its capital stock or any stock or
securities convertible into or exchangeable for its capital stock or any stock
appreciation rights or phantom stock plans other than pursuant to and as
contemplated by this Agreement, the Senior Management Agreements, the Other
Executive Stock Agreements, the Purchase Agreement, the Stockholders Agreement
and the Company's Articles of Incorporation. As of the Closing, the Company
shall not be subject to any obligation (contingent or otherwise) to repurchase
or otherwise acquire or retire any shares of its capital stock or any warrants,
options or other rights to acquire its capital stock, except pursuant to this
Agreement, the Senior Management Agreements, the Other Executive Stock
Agreements, the Purchase Agreement and the Stockholders Agreement. As of the
Closing, all of the outstanding shares of the Company's capital stock shall be
validly issued, fully paid and nonassessable.
(ii) There are no statutory or contractual stockholders preemptive
rights or rights of refusal with respect to the issuance of the Common Stock
hereunder, except as provided herein and in the Stockholders Agreement. The
Company has not violated any applicable federal or state securities laws in
connection with the offer, sale or issuance of any of its capital stock, and the
-4-
<PAGE>
offer, sale and issuance of the Common Stock pursuant to this Agreement do not
and will not require registration under the Securities Act.
(c) Conduct of Business; Liabilities. Other than in the course of
--------------------------------
the negotiation, execution and delivery of this Agreement, the Senior Management
Agreements, the Other Executive Stock Agreements, the Purchase Agreement and the
other agreements contemplated hereby and thereby, prior to the Closing, the
Company has not (i) conducted any business, (ii) incurred any expenses,
obligations or liabilities (whether accrued, absolute, contingent, unliquidated
or otherwise, whether or not known to the Company and whether due or to become
due and regardless of when asserted), (iii) owned any assets, or (iv) entered
into any contracts or agreements.
4. Vesting of Executive Stock.
--------------------------
(a) Except as otherwise provided in paragraph 4(b) below, 20% of
the Executive Stock will be deemed "Vested Shares" as of the date of Closing and
the remainder of the Executive Stock will become vested in accordance with the
following schedule, if as of each such date Executive is still employed by the
Company or any of its Subsidiaries:
Cumulative
Anniversary of Percentage of Executive
the Date of Closing Stock Vested
------------------- -----------------------
1st 40
2nd 60
3rd 80
4th 100
Any shares of Executive Stock which do not become Vested Shares under the
foregoing provisions will remain "Unvested Shares."
(b) If Executive ceases to be employed by the Company and its
Subsidiaries on any date other than any anniversary date, the cumulative
percentage of Executive Stock to become vested will
-5-
<PAGE>
be determined on a pro-rata basis according to the number of days elapsed since
the prior anniversary date. Immediately prior to the closing of (i) any sale of
the Company's equity securities which results in any person, or group of related
persons not affiliated with GTCR, owning equity securities of the Company
possessing the power to elect (without reference to any special or default
voting rights) a majority of the members of the Board or (ii) a sale of all or
substantially all of the Company's assets, all Unvested Shares will become
Vested Shares.
5. Repurchase Option.
-----------------
(a) In the event Executive violates paragraph 10(a) of this
Agreement (a "Noncompete Breach"), or in the event Executive's employment by the
-----------------
Company and its Subsidiaries terminates for any reason (a "Termination"), the
-----------
Executive Call Stock (whether held by Executive or one or more of Executive's
transferees, other than the Company or GTCR) will be subject to repurchase by
the Company first, Management second and GTCR third pursuant to the terms and
conditions set forth in this paragraph 5 (the "Repurchase Option").
-----------------
(b) If the Repurchase Option becomes exercisable because of a
Noncompete Breach or a Termination resulting from the Company's termination of
Executive's employment for Cause, then, the purchase price for each share of
----
Executive Call Stock will be the lower of (a) Executive's Original Cost for such
share or (b) the Fair Market Value of such share. If Executive's employment
terminates other than as described in the preceding sentence, the purchase price
for each (i) Unvested Share shall be Executive's Original Cost for such share,
and (ii) Vested Share shall be the Fair Market Value of such share as of the
date of the related Repurchase Notice or Investor Notice (as hereinafter
defined), as the case may be.
(c) The Company may, at the option of the Board, elect to purchase
all or any portion of the Executive Call Stock from time to time by delivering
written notice (the "Repurchase Notice") to Management, GTCR and the holder or
-----------------
holders of such Executive Call Stock from time to time during the 270 days after
the Noncompete Breach or Termination, as the case may be. The Repurchase Notice
will set forth the number of shares of Executive Call Stock, including the
number of Unvested Shares and Vested
-6-
<PAGE>
Shares, to be acquired from the recipient holder, the aggregate consideration to
be paid for such shares and the time and place for the closing of the
transaction.
(d) If for any reason the Company has not elected to purchase all of
the Executive Call Stock pursuant to the Repurchase Option, Management shall be
entitled to exercise the Repurchase Option for any or all of the shares of
Executive Call Stock, including the Unvested Shares and the Vested Shares, the
Company has not yet elected to purchase (the "Available Shares"), by giving
----------------
written notice to the Company and the holder(s) of the Available Shares to be
repurchased during the 30 days after the date of delivery to Management of the
Repurchase Notice (the "Management Notice") setting forth the number of
-----------------
Available Shares each Manager is willing to purchase. If the Managers elect to
purchase an aggregate number of shares greater than the number of Available
Shares, the Available Shares shall be allocated among the Managers pro rata
based on the number of shares of Common Stock owned by each Manager. As soon as
practicable, and in any event, within 10 days after the expiration of the 30-day
period set forth above, the Company shall notify the holder(s) of the Available
Shares and GTCR as to the number of shares being purchased from such holder(s)
by Management (the "Supplemental Repurchase Notice"). At the time the Company
------------------------------
delivers the Supplemental Repurchase Notice to the holder(s) of the Available
Shares, the Company shall also deliver written notice to each Manager and GTCR
setting forth the number of shares such Manager is entitled to purchase, the
aggregate purchase price and the time and place of the closing of the
transaction and, in the notice to GTCR, a statement of the number, type and
purchase price of Available Shares available for purchase by GTCR.
(e) If for any reason Management has not elected to purchase any or
all of the Available Shares pursuant to paragraph 5(d) above, GTCR may elect to
purchase any or all of the Available Shares not purchased by Management by
giving written notice to the holder(s) of the Available Shares to be repurchased
within 30 days after the date of delivery to GTCR of the Supplemental Repurchase
Notice (the "Investor Repurchase Notice") setting forth the number of Available
--------------------------
Shares GTCR is willing to purchase.
(f) Each closing of the purchase of the Executive Call Stock pursuant
to the Repurchase Option shall take place on the
-7-
<PAGE>
date designated by the Company, Management or GTCR in the related Repurchase
Notice, Supplemental Repurchase Notice, or Investor Repurchase Notice, as the
case may be, but in any event not later than 365 days after the date of the
Noncompete Breach or Termination. At such closing, Executive shall deliver to
the Company, Management and/or GTCR certificates representing the Executive
Stock to be repurchased by the Company, Management and/or GTCR and the Company,
Management and/or GTCR, as the case may be, will pay for the Executive Call
Stock to be purchased pursuant to the Repurchase Option in the following manner:
(i) In the event that no Event of Default has occurred and is
continuing on the date of the Noncompete Breach or Termination, payment for the
Executive Call Stock to be purchased shall be made by delivery to Executive of a
cashier's or certified check or wire transfer of funds in the amount of one-half
of the purchase price of the Executive Call Stock on the date of the closing of
the Repurchase Option. Payment for the remaining one-half of the purchase price
shall be made by delivery of a promissory note of the purchaser, with an
aggregate principal amount equal to one-half of the purchase price of the
Executive Stock to be repurchased, payable in one lump sum payment on the second
anniversary of the date of issuance and bearing interest at the rate of 8% per
annum.
(ii) In the event that an Event of Default has occurred and is
continuing on the date of the Noncompete Breach or Termination, payment for the
Executive Call Stock to be purchased shall be made by delivery of a promissory
note of the purchaser, with an aggregate principal amount equal to the total
purchase price of the Executive Call Stock to be repurchased, payable in one
lump sum payment on the fifth anniversary of the date of issuance and bearing
interest at the rate of 8% per annum.
Any such note issued by the Company pursuant to subparagraphs (i) and (ii) above
shall be junior and subordinated in right of payment to all indebtedness of the
Company (for borrowed money or otherwise). In addition, the Company may pay the
total purchase price for such shares by offsetting amounts outstanding under any
bona fide debts owed by Executive to the Company. The Company,
-8-
<PAGE>
Management and GTCR will be entitled to receive customary representations and
warranties from the sellers regarding such sale and to require that all sellers'
signatures be guaranteed.
(g) If within six months following the repurchase of Executive Call
Stock pursuant to paragraph 5(f) above, (i) a Sale of the Company or a Public
Offering of the Company's Common Stock registered under the Securities Act
occurs and (ii) the valuation of a share of Common Stock for such transaction
(based upon the purchase price or liquidation proceeds per share of Common Stock
or the Public Offering price per share of Common Stock, but reduced by any
preferential amounts available to any of the classes of Common Stock) exceeds
the amounts per share received by the holder(s) of Executive Call Stock upon the
repurchase of Vested Shares, then such holder(s) of Executive Call Stock shall
be entitled to receive from the Company the benefit of such higher valuation for
the Vested Shares of Executive Call Stock sold under the Repurchase Option. The
excess of (x) the amount which the holder(s) of Executive Call Stock would have
received in such Sale of the Company or Public Offering assuming the sale of
their Vested Shares of Executive Call Stock purchased by exercise of the
Repurchase Option in connection with such transaction, over (y) the purchase
price of the Vested Shares of Executive Call Stock paid to Executive under the
Repurchase Option, shall be paid by certified check or cashier's check or wire
transfer of funds to each such holder upon consummation of any such transaction.
For purposes of this paragraph 5(g), "Sale" means the sale of all or
substantially all of the assets of the Company or a sale of the Company's equity
securities which results in any person, or group of related persons, owning
equity securities of the Company possessing the power to elect (without
reference to any special or default voting rights) a majority of the members of
the Board, including any such sale accomplished by merger or consolidation.
6. Restrictions on Transfer.
------------------------
(a) Transfer of Executive Stock. On or prior to the Restriction Lapse
---------------------------
Date, Executive shall not transfer any interest in any shares of Executive Stock
(a "Transfer"), except pursuant to the provisions of paragraph 5 or 6(e) of this
--------
Agreement. After the Restriction Lapse date, Executive shall not Transfer any
interest in any shares of Executive stock except (i) pursuant to the
-9-
<PAGE>
provisions of paragraph 5 or 6(e) of this Agreement, (ii) in a Public Sale or
(iii) pursuant to the provisions of paragraphs 6(b), 6(c) and 6(d) of this
Agreement. Prior to effecting any Transfer of Executive Stock (other than to the
Company, Management or GTCR), Executive shall obtain from each transferee their
written agreement to be bound by the provisions of paragraph 6 of this Agreement
for the benefit of the Company, Management and GTCR.
(b) Sale Notice. After the Restriction Lapse Date, prior to making any
-----------
Transfer, Executive will give written notice (the "Sale Notice") to the Company,
-----------
each Manager and GTCR. The Sale Notice will disclose in reasonable detail the
number of shares to be transferred and the terms and conditions of the proposed
Transfer and, if known, the identity of the prospective transferee(s). Executive
will not consummate any such Transfer until 90 days after the Sale Notice has
been given to the Company, Management and GTCR, unless the parties to the
Transfer have been fully determined pursuant to this paragraph 6(b) and
paragraphs 6(c) and 6(d) prior to the expiration of such 90-day period. (The
date of the first to occur of such events is referred to herein as the
"Authorization Date.")
------------------
(c) First Refusal Rights. The Company may elect to purchase all (but
--------------------
not less than all) of the shares of Executive Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Executive, each Manager and GTCR within 30
days after the Sale Notice has been given to the Company. If the Company has not
elected to purchase all of the Executive Stock to be transferred, Management may
elect to purchase all (but not less than all) of the Executive Stock to be
transferred upon the same terms and conditions as those set forth in the Sale
Notice by giving written notice of such election to Executive, the Company and
GTCR within 60 days after the Sale Notice has been given to Management.
Management's rights hereunder shall be allocated among the Managers pro rata
based on the number of shares of Common Stock owned by each Manager. If the
Company and Management have not elected to purchase all of the Executive Stock
to be transferred, GTCR may elect to purchase all (but not less than all) of the
Executive Stock to be transferred upon the same terms and conditions as those
set forth in the Sale Notice by giving written notice of such election to
Executive, the Company and each Manager
-10-
<PAGE>
within 90 days after the Sale Notice has been given to GTCR. If, the Company,
Management or GTCR do not elect to purchase all of the shares of Executive Stock
specified in the Sale Notice, Executive may transfer the shares of Executive
Stock specified in the Sale Notice at a price and on terms no more favorable to
the transferee(s) thereof than specified in the Sale Notice during the 30-day
period immediately following the Authorization Date. Any shares of Executive
Stock not transferred within such 30-day period will be subject to the
provisions of this paragraph 6(c) upon subsequent transfer.
(d) Co-Sale Rights.
--------------
(i) GTCR may elect to participate in the contemplated Transfer by
delivering written notice to Executive within 90 days after delivery of the
Sale Notice to GTCR. If GTCR has elected to participate in such Transfer,
Executive and GTCR shall be entitled to sell in the contemplated Transfer,
on the same terms and at the price calculated pursuant to subparagraph
6(d)(ii) below, a number of shares equal to the product of (x) the quotient
determined by dividing the number of shares of Common Stock owned by such
person by the aggregate number of shares of Common Stock owned by Executive
and GTCR and (y) the number of shares to be sold in the contemplated
Transfer.
For example, if the Sale Notice contemplated a sale of 100 shares by
-----------
Executive, and if Executive was at such time the owner of 30% of the
Company's Common Stock (on a fully-diluted basis) and if GTCR elected to
participate and GTCR owned 20% of the Company's Common Stock (on a fully-
diluted basis), Executive would be entitled to sell 60 shares (30% - 50% x
100 shares) and GTCR would be entitled to sell 40 shares (20% - 50% x 100
shares).
Executive will use his best efforts to obtain the agreement of the
prospective transferee(s) to the participation of GTCR in the contemplated
transfer and will not transfer any Executive Stock to the prospective
transferee(s) if such transferee(s) refuses to allow the participation of
GTCR.
-11-
<PAGE>
(ii) The purchase price to be paid by any transferee for
shares of Class B Common and Class A Common transferred in accordance with this
paragraph 6(d) shall be determined as follows: (i) the price per share to be
paid for Class B Common included in such Transfer shall be equal to the amount
per share of Class B Common which such transferee has agreed to pay to Executive
and (ii) the price per share to be paid for Class A Common included in such
Transfer shall be the price per share described in clause (i) plus the quotient
----
(the "Per Share Preference") of (A) the sum of the Unreturned Preferred Amount
--------------------
and the Unpaid Yield of the Class A Common at such time divided by (B) the
----------
number of shares of Class A Common then outstanding.
(e) Permitted Transfers. The restrictions contained in this
-------------------
paragraph 6 shall not apply with respect to any Transfer of Executive Stock
pursuant to applicable laws of descent and distribution or among such Executive
and such Executive's Family Members; provided that such restrictions will
continue to be applicable to the Executive Stock after any such transfer and the
transferees of such Executive Stock have agreed in writing to be bound by the
provisions of this Agreement.
(f) Pledges. Notwithstanding the provisions of this paragraph 6,
-------
Executive may pledge any shares of Executive Stock to the Company to secure
payment of the Executive Note.
7. Additional Restrictions on Transfer of Executive Stock.
------------------------------------------------------
(a) Legend. The certificates representing the Executive Stock will
------
bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY
ISSUED AS OF JANUARY 31, 1995, HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD
OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO
-12-
<PAGE>
SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE
OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN EXECUTIVE
STOCK AGREEMENT BETWEEN THE COMPANY, AN EXECUTIVE OF THE COMPANY,
AND A CERTAIN INVESTOR, DATED AS OF JANUARY 31, 1995. A COPY OF
SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S
PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE."
(b) Opinion of Counsel. No holder of Executive Stock may
------------------
sell, transfer or dispose of any Executive Stock (except pursuant to an
effective registration statement under the Securities Act) without first
delivering to the Company an opinion of counsel (reasonably acceptable in form
and substance to the Company) that (i) neither registration nor qualification
under the Securities Act and applicable state securities laws is required in
connection with such transfer or (ii) all such applicable registration and
qualification requirements have been satisfied.
-13-
<PAGE>
PART II: GENERAL PROVISIONS
8. Definitions.
-----------
"Acquisition Agreement" means the agreement by and among
---------------------
the Company, CIC, the stockholders of CIC and the Subsidiary, dated as of
January 31, 1995.
"Cause" means (i) a material breach of any agreement with the
-----
Company, its Subsidiaries or its stockholders by Executive (after notice and
reasonable opportunity to cure), (ii) a breach of Executive's duty of loyalty to
the Company or any of its Subsidiaries or any act of dishonesty, gross
negligence, willful misconduct or fraud with respect to the Company or any of
its Subsidiaries or any of their stockholders, customers or suppliers, (iii) the
commission by Executive of a felony, a crime involving moral turpitude or other
act or omission tending to cause harm to the standing and reputation of, or
otherwise bring public disgrace or disrepute to, the Company or any of its
Subsidiaries, (iv) Executive's continued failure or refusal to perform any
material duty to the Company or any of its Subsidiaries which is normally
attached to his position (after notice and reasonable opportunity to cure) or
(v) Executive's gross negligence or willful misconduct in performing those
duties which are normally attached to his position (after notice and reasonable
opportunity to cure). For purposes of this Agreement, "Executive's duty of
loyalty to the Company or any of its Subsidiaries" shall include the Executive's
fiduciary obligation to place the interests of the Company and its Subsidiaries
ahead of his personal interests and thereby not knowingly profit personally at
the expense of the Company or any of its Subsidiaries, and shall also include
specifically the affirmative obligation to disclose promptly to the Board any
known conflicts of interest Executive may have with respect to the Company and
its Subsidiaries, and the negative obligations not to usurp corporate
opportunities of the Company or any of its Subsidiaries, not to engage in any
"conflict-of-interest" transactions with the Company or its Subsidiaries
(without the approval of the board directors), and not to compete directly with
the Company or its Subsidiaries (without the approval of the Board).
"Event of Default" means Event of Default as defined in
----------------
-14-
<PAGE>
the Credit Agreement, dated as of the date hereof, among Coinmach Industries
Co., Super Laundry Equipment Co., L.P., Heller Financial, Inc., Jackson National
Life Insurance Company and Jackson National Life Insurance Company of Michigan
and any similar term in any replacement for, refinancing of, or modification or
amendment to, such Credit Agreement.
"Executive Call Stock" means at any time (i) all equity securities of
--------------------
the Company then held by Executive or a Family Member, (ii) all equity
securities of the Company which at any time have been held by Executive (whether
or not then held by Executive), and (iii) all equity securities of the Company
issued or issuable directly or indirectly with respect to any equity securities
described in clause (i) or (ii) above in connection with a combination of
shares, dividend, recapitalization, merger, consolidation, reorganization or
otherwise; provided that any equity securities which had been Executive Call
--------
Stock and which have been transferred in accordance with the terms of this
Agreement will not be Executive Call Stock at any subsequent time unless held at
the time of determination by Executive or a Family Member.
"Executive Stock" means the shares of the Company's Class B Common
---------------
Stock purchased hereunder.
"Fair Market Value" of each share of Common Stock constituting
-----------------
Executive Stock at the time of valuation means Fair Market Value as defined in
the Stockholders Agreement, except that Operating Cash Flow will be determined
based upon the twelve (12) month period ending on the fiscal quarter end
immediately preceding the date of Termination or of the Noncompete Breach, as
the case may be.
"Family Members" means Executive's spouse and/or lineal descendants, a
--------------
trust for the sole benefit of Executive and/or Executive's spouse or lineal
descendants or upon Executive's death, Executive's estate.
"IRC" means the Internal Revenue Code of 1986, as amended, and any
---
reference to any particular IRC section shall be interpreted to include any
revision of or successor to that section regardless of how numbered or
classified.
-15-
<PAGE>
"Original Cost" of each share of Class B Common Stock purchased
-------------
hereunder will be equal to $29.167 (as proportionately adjusted for all
subsequent stock splits, stock dividends and other recapitalizations).
"Public Offering" means the sale in an underwritten public offering
---------------
registered under the Securities Act (other than on Form S-8 or a similar or
successor form) of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering
-----------
under the Securities Act or any sale to the public pursuant to Rule 144
promulgated under the Securities Act effected through a broker, dealer or market
maker.
"Registration Agreement" means the Registration Agreement dated as of
-----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Executive.
"Restriction Lapse Date" means the earlier of (i) the fifth
----------------------
anniversary of the date of this Agreement and (ii) the date of the closing of
any Public Offering.
"Securities Act" means the Securities Act of 1933, as amended from
--------------
time to time.
"Securities Exchange Act" means the Securities Exchange Act of 1934,
-----------------------
as amended from time to time.
"Stockholders Agreement" means the Stockholders Agreement dated as of
-----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Executive.
"Subsidiary" means, with respect to any Person, any corporation,
----------
partnership, association or other business entity of which (i) if a corporation,
a majority of the total voting power of shares of stock entitled (without regard
to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof, or (ii) if a partnership, association or other
business entity, a majority of the partnership
-16-
<PAGE>
or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of that Person
or a combination thereof. For purposes hereof, a Person or Persons shall be
deemed to have a majority ownership interest in a partnership, association or
other business entity if such Person or Persons shall be allocated a majority of
partnership, association or other business entity gains or losses or shall be or
control the managing director or general partner of such partnership,
association or other business entity.
"Transfer" means to sell, transfer, assign, pledge or otherwise dispose
--------
of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law).
"Unreturned Preferred Amount" means the "Unreturned Preferred Amount"
---------------------------
as defined in the Company's Certificate of Incorporation.
"Unpaid Yield" means the "Unpaid Yield" as defined in the Company's
------------
Certificate of Incorporation.
9. Notices. Any notice provided for in this Agreement must
-------
be in writing and must be either personally delivered, mailed by first class
mail (postage prepaid and return receipt requested) or sent by reputable
overnight courier service (charges prepaid) to each person at the address set
forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a Copy (which will constitute notice to the Company) to:
------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
-17-
<PAGE>
If to the Executive:
-------------------
Russell Harrison
c/o The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
With a copy (which will not constitute notice to Executive) to:
--------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
10. General Provisions.
------------------
(a) Transfers in Violation of Agreement. Any Transfer or
-----------------------------------
attempted Transfer of any Executive Stock in violation of any provision of this
Agreement shall be void, and the Company shall
-18-
<PAGE>
not record such Transfer on its books or treat any purported transferee of such
Executive Stock as the owner of such stock for any purpose.
(b) Severability. Whenever possible, each provision of this Agreement
------------
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
(c) Complete Agreement. This Agreement, those documents expressly
------------------
referred to herein and other documents of even date herewith (i) embody the
complete agreement and understanding among the parties and (ii) supersede and
preempt any prior summaries of terms and conditions, understandings, agreements
or representations by or among the parties, written or oral, which may have
related to the subject matter hereof in any way.
(d) Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
(e) Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Executive and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Executive, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Executive Stock); provided
--------
that Executive may not assign any of his rights under any other provision of
Part I of this Agreement except as part of a Transfer of Executive Stock in
accordance with paragraphs 5 or 6.
(f) Choice of Law. The corporate law of the State of Delaware will
-------------
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this
-19-
<PAGE>
Agreement and the exhibits hereto will be governed by and construed in
accordance with the internal laws of the State of Illinois, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of Illinois or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Illinois.
(g) Remedies. Each of the parties to this Agreement will be entitled
--------
to enforce its rights under this Agreement specifically, to recover damages and
costs (including attorney's fees) caused by any breach of any provision of this
Agreement and to exercise all other rights existing in its favor. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and, except as otherwise
provided in paragraph 10(d), that any party may in its sole discretion apply to
any court of law or equity of competent jurisdiction (without posting any bond
or deposit) for specific performance and/or other injunctive relief in order to
enforce or prevent any violations of the provisions of this Agreement.
(h) Amendment and Waiver. Except as otherwise expressly provided
--------------------
herein, the provisions of this Agreement may be amended or modified only by
written agreement of the Company, Executive and GTCR. No other course of dealing
between the parties or third party beneficiaries hereof or any delay in
exercising any rights hereunder shall operate as a waiver of any rights of any
such holders.
(i) Survival of Representations and Warranties. All representations
------------------------------------------
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Executive or on his behalf or by the Company or on its
behalf.
(j) Business Days. If any time period for giving notice or taking
-------------
action hereunder expires on a day which is a Saturday, Sunday or holiday in the
state in which the Company's chief executive office is located, the time period
shall be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
-20-
<PAGE>
(k) Descriptive Headings: Interpretation. The descriptive headings of
------------------------------------
this Agreement are inserted for convenience only and do not constitute a Section
of this Agreement. The use of the word "including" in this Agreement shall be by
way of example rather than by limitation.
* * * * *
-21-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
on the date first written above.
THE COINMACH CORPORATION
By /S/ ROBERT M. DOYLE
-----------------------
Its Vice President
----------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /S/ CARL D. THOMAS
----------------------
Its: Principal
EXECUTIVE
/S/ RUSSELL HARRISON
-------------------------------
Russell Harrisson
<PAGE>
CONSENT
-------
The undersigned spouse of Executive hereby acknowledges that I have
read the foregoing Executive Stock Agreement and that I understand its contents.
I am aware that the Agreement provides for the repurchase of my spouse's shares
of Common Stock under certain circumstances and imposes other restrictions on
the transfer of such Common Stock. I agree that my spouse's interest in the
Common Stock subject to this Agreement and any interest I may have in such
Common Stock shall be irrevocably bound by this Agreement and further that my
community or marital property interest, if any, shall be similarly bound by this
Agreement.
/S/ AGNES M. HARRISON
---------------------
Spouse's Name:
/S/ KELLY A. NEWELL
---------------------
Witness
<PAGE>
EXHIBIT 29
EXECUTIVE STOCK AGREEMENT
-------------------------
THIS AGREEMENT is made as of January 31, 1995, between The Coinmach
Corporation, a Delaware corporation (the "Company"),David Tulkop ("Executive")
------- ---------
and Golder, Thoma, Cressey, Rauner Fund IV, L.P. ("GTCR").
----
The Company and Executive desire to enter into an agreement pursuant to
which Executive will purchase, and the Company will issue, 500 shares of the
Company's Class B Common Stock, par value $0.01 per share (the "Class B Common
--------------
Stock"). Certain definitions are set forth in paragraph 8 of this Agreement.
- -----
Simultaneously with the execution of this Agreement, Charles Prato
("Prato") and Russell Harrison ("Harrison) are each entering into executive
----- --------
stock agreements (the "Other Executive Stock Agreements") substantially similar
--------------------------------
to this Agreement pursuant to which Prato and Harrison will acquire shares of
the Company's Class B Common Stock, and each of Stephen R. Kerrigan
("Kerrigan"), Mitchell Blatt ("Blatt") and Robert M. Doyle ("Doyle", and
-------- ----- -----
together with Kerrigan, Blatt, Executive, Prato and Harrison, "Management" and
----------
individually, a "Manager") are entering into a senior management agreement (the
-------
"Senior Management Agreements") pursuant to which Kerrigan, Blatt and Doyle will
----------------------------
acquire shares of the Company's Class B Common Stock.
The execution and delivery of this Agreement by the Company and
Executive is a condition to the purchase of 72,516 shares of the Company's Class
A Common Stock, par value $0.01 per share (the "Class A Common Stock"), by GTCR
--------------------
pursuant to a purchase agreement dated as of the date hereof (the "Purchase
--------
Agreement"). The Class A Common Stock and Class B Common Stock are hereinafter
- ---------
collectively referred to as the "Common Stock". Certain provisions of this
------------
Agreement are intended for the benefit of, and will be enforceable by, GTCR.
The parties hereto agree as follows:
<PAGE>
PART I: PROVISIONS RELATING TO EXECUTIVE STOCK
1. Authorization of the Common Stock. The Company shall authorize the
---------------------------------
issuance to Executive of 500 shares of Class B Common Stock having the rights
set forth in Exhibit A attached hereto.
---------
2. Acquisition of Stock.
--------------------
(a) Purchase and Sale of Executive Stock. Upon execution of this
------------------------------------
Agreement, Executive will purchase, and the Company will sell, 500 shares of
Class B Common Stock at a price of $29.167 per share. The Company will deliver
to Executive the certificate representing such Common Stock, and Executive will
deliver to the Company a check or wire transfer of funds in the aggregate amount
of $2,916.70, and a promissory note in the form of Exhibit B attached hereto in
---------
the aggregate amount of $11,666.80 (the "Executive Note"). Executive's
--------------
obligations under the Executive Note will be secured by a pledge of all of the
shares of Executive Stock to the Company and in connection therewith Executive
shall enter into a pledge agreement in the form of Exhibit C attached hereto.
---------
(b) Section 83(b) Election. Within 30 days after Executive purchases
----------------------
any Executive Stock, Executive will make an effective election with the Internal
Revenue Service under Section 83(b) of the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder, in the form of Exhibit D
---------
attached hereto.
(c) Excutive's Representations and Warranties. In connection with the
-----------------------------------------
issuance of the Executive Stock hereunder, Executive represents and warrants to
the Company that, in each case, as of the Closing:
(i) The Class B Common Stock to be acquired by Executive pursuant to
this Agreement will be acquired for Executive's own account and not with a view
to, or intention of, distribution thereof in violation of the Securities Act,
or any applicable state securities laws, and such Class B Common Stock will not
be disposed of in contravention of the Securities Act or any applicable state
securities laws.
- 2 -
<PAGE>
(ii) Executive has been an executive of Coinmach Industries Co., L.P., a
New York limited partnership ("Coinmach") and one of the partnerships to be
--------
acquired by the Company and its Subsidiaries on the date hereof, and Executive
is now an executive of Coinmach, is sophisticated in financial matters and is
able to evaluate the risks and benefits of the investment in such Class B Common
Stock.
(iii) Executive is able to bear the economic risk of his investment in
such Class B Common Stock for an indefinite period of time, and Executive
acknowledges that such Class B Common Stock has not been registered under the
Securities Act and, therefore, cannot be sold unless subsequently registered
under the Securities Act or an exemption from such registration is available.
(iv) Executive has had an opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of such Class B
Common Stock and has had full access to such other information concerning the
Company as he has requested.
(v) This Agreement, the Stockholders Agreement and the Registration
Agreement constitute legal, valid and binding obligations of Executive,
enforceable in accordance with their terms, and the execution, delivery and
performance of this Agreement, the Other Executive Stock Agreements, the
Stockholders Agreement and the Registration Agreement by Executive does not and
will not conflict with, violate or cause a breach of any agreement, contract or
instrument to which Executive is a party or any law, rule, regulation, judgment,
order or decree to which Executive is subject.
3. Representations and Warranties of the Company. In connection with the
---------------------------------------------
issuance of the Executive Stock hereunder, the Company represents to Executive
that, in each case, as of the Closing:
(a) Organization and Corporate Power. The Company is a corporation duly
--------------------------------
organized, validly existing and in good standing under the laws of Delaware. The
Company has all requisite corporate power and authority to carry out the
transactions contemplated by this Agreement, the Stockholders Agreement and the
- 3 -
<PAGE>
Registration Agreement (the "Investment Agreements"). The copies of the
---------------------
Company's Certificate of Incorporation and Bylaws which have been furnished to
Executive's counsel reflect all amendments made thereto at any time prior to the
date of this Agreement and are correct and complete.
(b) Capital Stock and Related Matters.
---------------------------------
(i) As of the Closing and immediately thereafter, the authorized
capital stock of the Company shall consist of 10,000 shares which will be
designated as Preferred Stock and 108,150 shares of Common Stock, of which
77,350 shares shall be designated as Class A Common Stock, 15,500 shares shall
be designated Class B Common Stock, 7650 shares shall be designated as Class C
Common Stock and 7650 shares shall be designated as Class D Common Stock. As of
the Closing, the Company shall not have outstanding any stock or securities
convertible or exchangeable for any shares of its capital stock or containing
any profit participation features, nor shall it have outstanding any rights or
options to subscribe for or to purchase its capital stock or any stock or
securities convertible into or exchangeable for its capital stock or any stock
appreciation rights or phantom stock plans other than pursuant to and as
contemplated by this Agreement, the Senior Management Agreements, the Other
Executive Stock Agreements, the Purchase Agreement, the Stockholders Agreement
and the Company's Articles of Incorporation. As of the Closing, the Company
shall not be subject to any obligation (contingent or otherwise) to repurchase
or otherwise acquire or retire any shares of its capital stock or any warrants,
options or other rights to acquire its capital stock, except pursuant to this
Agreement, the Senior Management Agreements, the Other Executive Stock
Agreements, the Purchase Agreement and the Stockholders Agreement. As of the
Closing, all of the outstanding shares of the Company's capital stock shall be
validly issued, fully paid and nonassessable.
(ii) There are no statutory or contractual stockholders preemptive
rights or rights of refusal with respect to the issuance of the Common Stock
hereunder, except as provided herein and in the Stockholders Agreement. The
Company has not violated any applicable federal or state securities laws in
connection with the offer, sale or issuance of any of its capital stock, and the
offer, sale and issuance of the Common Stock pursuant to this
- 4 -
<PAGE>
Agreement do not and will not require registration under the Securities Act.
(c) Conduct of Business; Liabilities. Other than in the course of the
--------------------------------
negotiation, execution and delivery of this Agreement, the Senior Management
Agreements, the Other Executive Stock Agreements, the Purchase Agreement and the
other agreements contemplated hereby and thereby, prior to the Closing, the
Company has not (i) conducted any business, (ii) incurred any expenses,
obligations or liabilities (whether accrued, absolute, contingent, unliquidated
or otherwise, whether or not known to the Company and whether due or to become
due and regardless of when asserted), (iii) owned any assets, or (iv) entered
into any contracts or agreements.
4. Vesting of Executive Stock.
--------------------------
(a) Except as otherwise provided in paragraph 4(b) below, 20% of the
Executive Stock will be deemed "Vested Shares" as of the date of Closing and the
remainder of the Executive Stock will become vested in accordance with the
following schedule, if as of each such date Executive is still employed by the
Company or any of its Subsidiaries:
Cumulative
Anniversary of Percentage of Executive
the Date of Closing Stock Vested
--------------------- ------------------------
1st 40
2nd 60
3rd 80
4th 100
Any shares of Executive Stock which do not become Vested Shares under the
foregoing provisions will remain "Unvested Shares."
(b) If Executive ceases to be employed by the Company and its
Subsidiaries on any date other than any anniversary date, the cumulative
percentage of Executive Stock to become vested will be determined on a pro-rata
basis according to the number of days elapsed since the prior anniversary date.
Immediately prior to the
- 5 -
<PAGE>
closing of (i) any sale of the Company's equity securities which results in any
person, or group of related persons not affiliated with GTCR, owning equity
securities of the Company possessing the power to elect (without reference to
any special or default voting rights) a majority of the members of the Board or
(ii) a sale of all or substantially all of the Company's assets, all Unvested
Shares will become Vested Shares.
5. Repurchase Option.
-----------------
(a) In the event Executive violates paragraph 10(a) of this Agreement
(a "Noncompete Breach"), or in the event Executive's employment by the Company
-----------------
and its Subsidiaries terminates for any reason (a "Termination"), the Executive
-----------
Call Stock (whether held by Executive or one or more of Executive's transferees,
other than the Company or GTCR) will be subject to repurchase by the Company
first, Management second and GTCR third pursuant to the terms and conditions set
forth in this paragraph 5 (the "Repurchase Option").
-----------------
(b) If the Repurchase Option becomes exercisable because of a
Noncompete Breach or a Termination resulting from the Company's termination of
Executive's employment for Cause, then, the purchase price for each share of
----
Executive Call Stock will be the lower of (a) Executive's Original Cost for such
share or (b) the Fair Market Value of such share. If Executive's employment
terminates other than as described in the preceding sentence, the purchase price
for each (i) Unvested Share shall be Executive's Original Cost for such share,
and (ii) Vested Share shall be the Fair Market Value of such share as of the
date of the related Repurchase Notice or Investor Notice (as hereinafter
defined), as the case may be.
(c) The Company may, at the option of the Board, elect to purchase all
or any portion of the Executive Call Stock from time to time by delivering
written notice (the "Repurchase Notice") to Management, GTCR and the holder or
-----------------
holders of such Executive Call Stock from time to time during the 270 days after
the Noncompete Breach or Termination, as the case may be. The Repurchase Notice
will set forth the number of shares of Executive Call Stock, including the
number of Unvested Shares and Vested Shares, to be acquired from the recipient
holder, the aggregate consideration to be paid for such shares and the time and
place for the closing of the transaction.
- 6 -
<PAGE>
(d) If for any reason the Company has not elected to purchase all of
the Executive Call Stock pursuant to the Repurchase Option, Management shall be
entitled to exercise the Repurchase Option for any or all of the shares of
Executive Call Stock, including the Unvested Shares and the Vested Shares, the
Company has not yet elected to purchase (the "Available Shares"), by giving
----------------
written notice to the Company and the holder(s) of the Available Shares to be
repurchased during the 30 days after the date of delivery to Management of the
Repurchase Notice (the "Management Notice") setting forth the number of
-----------------
Available Shares each Manager is willing to purchase. If the Managers elect to
purchase an aggregate number of shares greater than the number of Available
Shares, the Available Shares shall be allocated among the Managers pro rata
based on the number of shares of Common Stock owned by each Manager. As soon as
practicable, and in any event, within 10 days after the expiration of the 30-day
period set forth above, the Company shall notify the holder(s) of the Available
Shares and GTCR as to the number of shares being purchased from such holder(s)
by Management (the "Supplemental Repurchase Notice"). At the time the Company
------------------------------
delivers the Supplemental Repurchase Notice to the holder(s) of the Available
Shares, the Company shall also deliver written notice to each Manager and GTCR
setting forth the number of shares such Manager is entitled to purchase, the
aggregate purchase price and the time and place of the closing of the
transaction and, in the notice to GTCR, a statement of the number, type and
purchase price of Available Shares available for purchase by GTCR.
(e) If for any reason Management has not elected to purchase any or
all of the Available Shares pursuant to paragraph 5(d) above, GTCR may elect to
purchase any or all of the Available Shares not purchased by Management by
giving written notice to the holder(s) of the Available Shares to be repurchased
within 30 days after the date of delivery to GTCR of the Supplemental Repurchase
Notice (the "Investor Repurchase Notice") setting forth the number of Available
--------------------------
Shares GTCR is willing to purchase.
(f) Each closing of the purchase of the Executive Call Stock pursuant
to the Repurchase Option shall take place on the date designated by the Company,
Management or GTCR in the related Repurchase Notice, Supplemental Repurchase
Notice, or Investor Repurchase Notice, as the case may be, but in any event not
later than 365 days after the date of the Noncompete Breach or Termination. At
such closing, Executive shall deliver to the
- 7 -
<PAGE>
Company, Management and/or GTCR certificates representing the Executive Stock to
be repurchased by the Company, Management and/or GTCR and the Company,
Management and/or GTCR, as the case may be, will pay for the Executive Call
Stock to be purchased pursuant to the Repurchase Option in the following manner:
(i) In the event that no Event of Default has occurred and is
continuing on the date of the Noncompete Breach or Termination, payment for
the Executive Call Stock to be purchased shall be made by delivery to
Executive of a cashier's or certified check or wire transfer of funds in the
amount of one-half of the purchase price of the Executive Call Stock on the
date of the closing of the Repurchase Option. Payment for the remaining one-
half of the purchase price shall be made by delivery of a promissory note of
the purchaser, with an aggregate principal amount equal to one-half of the
purchase price of the Executive Stock to be repurchased, payable in one lump
sum payment on the second anniversary of the date of issuance and bearing
interest at the rate of 8% per annum.
(ii) In the event that an Event of Default has occurred and is
continuing on the date of the Noncompete Breach or Termination, payment for
the Executive Call Stock to be purchased shall be made by delivery of a
promissory note of the purchaser, with an aggregate principal amount equal
to the total purchase price of the Executive Call Stock to be repurchased,
payable in one lump sum payment on the fifth anniversary of the date of
issuance and bearing interest at the rate of 8% per annum.
Any such note issued by the Company pursuant to subparagraphs (i) and (ii) above
shall be junior and subordinated in right of payment to all indebtedness of the
Company (for borrowed money or otherwise). In addition, the Company may pay the
total purchase price for such shares by offsetting amounts outstanding under any
bona fide debts owed by Executive to the Company. The Company, Management and
GTCR will be entitled to receive customary representations and warranties from
the sellers regarding such sale and to require that all sellers' signatures be
guaranteed.
(g) If within six months following the repurchase of Executive Call
Stock pursuant to paragraph 5(f) above, (i) a Sale
- 8 -
<PAGE>
of the Company or a Public Offering of the Company's Common Stock registered
under the Securities Act occurs and (ii) the valuation of a share of Common
Stock for such transaction (based upon the purchase price or liquidation
proceeds per share of Common Stock or the Public Offering price per share of
Common Stock, but reduced by any preferential amounts available to any of the
classes of Common Stock) exceeds the amounts per share received by the holder(s)
of Executive Call Stock upon the repurchase of Vested Shares, then such
holder(s) of Executive Call Stock shall be entitled to receive from the Company
the benefit of such higher valuation for the Vested Shares of Executive Call
Stock sold under the Repurchase Option. The excess of (x) the amount which the
holder(s) of Executive Call Stock would have received in such Sale of the
Company or Public Offering assuming the sale of their Vested Shares of Executive
Call Stock purchased by exercise of the Repurchase Option in connection with
such transaction, over (y) the purchase price of the Vested Shares of Executive
Call Stock paid to Executive under the Repurchase Option, shall be paid by
certified check or cashier's check or wire transfer of funds to each such holder
upon consummation of any such transaction. For purposes of this paragraph 5(g),
"Sale" means the sale of all or substantially all of the assets of the Company
or a sale of the Company's equity securities which results in any person, or
group of related persons, owning equity securities of the Company possessing the
power to elect (without reference to any special or default voting rights) a
majority of the members of the Board, including any such sale accomplished by
merger or consolidation.
6. Restrictions on Transfer.
------------------------
(a) Transfer of Executive Stock. On or prior to the Restriction Lapse
---------------------------
Date, Executive shall not transfer any interest in any shares of Executive Stock
(a "Transfer"), except pursuant to the provisions of paragraph 5 or 6(e) of this
--------
Agreement. After the Restriction Lapse date, Executive shall not Transfer any
interest in any shares of Executive stock except (i) pursuant to the provisions
of paragraph 5 or 6(e) of this Agreement, (ii) in a Public Sale or (iii)
pursuant to the provisions of paragraphs 6(b), 6(c) and 6(d) of this Agreement.
Prior to effecting any Transfer of Executive Stock (other than to the Company,
Management or GTCR), Executive shall obtain from each transferee their written
agreement to be bound by the provisions of paragraph 6 of this Agreement for the
benefit of the Company, Management and GTCR.
- 9 -
<PAGE>
(b) Sale Notice. After the Restriction Lapse Date, prior to making any
-----------
Transfer, Executive will give written notice (the "Sale Notice") to the Company,
-----------
each Manager and GTCR. The Sale Notice will disclose in reasonable detail the
number of shares to be transferred and the terms and conditions of the proposed
Transfer and, if known, the identity of the prospective transferee(s). Executive
will not consummate any such Transfer until 90 days after the Sale Notice has
been given to the Company, Management and GTCR, unless the parties to the
Transfer have been fully determined pursuant to this paragraph 6(b) and
paragraphs 6(c) and 6(d) prior to the expiration of such 90-day period. (The
date of the first to occur of such events is referred to herein as the
"Authorization Date.")
------------------
(c) First Refusal Rights. The Company may elect to purchase all (but
--------------------
not less than all) of the shares of Executive Stock to be transferred upon the
same terms and conditions as those set forth in the Sale Notice by delivering a
written notice of such election to Executive, each Manager and GTCR within 30
days after the Sale Notice has been given to the Company. If the Company has not
elected to purchase all of the Executive Stock to be transferred, Management may
elect to purchase all (but not less than all) of the Executive Stock to be
transferred upon the same terms and conditions as those set forth in the Sale
Notice by giving written notice of such election to Executive, the Company and
GTCR within 60 days after the Sale Notice has been given to Management.
Management's rights hereunder shall be allocated among the Managers pro rata
based on the number of shares of Common Stock owned by each Manager. If the
Company and Management have not elected to purchase all of the Executive Stock
to be transferred, GTCR may elect to purchase all (but not less than all) of the
Executive Stock to be transferred upon the same terms and conditions as those
set forth in the Sale Notice by giving written notice of such election to
Executive, the Company and each Manager within 90 days after the Sale Notice has
been given to GTCR. If, the Company, Management or GTCR do not elect to purchase
all of the shares of Executive Stock specified in the Sale Notice, Executive may
transfer the shares of Executive Stock specified in the Sale Notice at a price
and on terms no more favorable to the transferee(s) thereof than specified in
the Sale Notice during the 30-day period immediately following the Authorization
Date. Any shares of Executive Stock not transferred within such 30-day period
- 10 -
<PAGE>
will be subject to the provisions of this paragraph 6(c) upon subsequent
transfer.
(d) Co-Sale Rights.
---------------
(i) GTCR may elect to participate in the contemplated Transfer by
delivering written notice to Executive within 90 days after delivery of the Sale
Notice to GTCR. If GTCR has elected to participate in such Transfer, Executive
and GTCR shall be entitled to sell in the contemplated Transfer, on the same
terms and at the price calculated pursuant to subparagraph 6(d)(ii) below, a
number of shares equal to the product of (x) the quotient determined by dividing
the number of shares of Common Stock owned by such person by the aggregate
number of shares of Common Stock owned by Executive and GTCR and (y) the number
of shares to be sold in the contemplated Transfer.
For example, if the Sale Notice contemplated a sale of 100 shares by Executive,
- -----------
and if Executive was at such time the owner of 30% of the Company's Common Stock
(on a fully-diluted basis) and if GTCR elected to participate and GTCR owned 20%
of the Company's Common Stock (on a fully-diluted basis), Executive would be
entitled to sell 60 shares (30% / 50% x 100 shares) and GTCR would be entitled
to sell 40 shares (20% / 50% x 100 shares).
Executive will use his best efforts to obtain the agreement of the prospective
transferee(s) to the participation of GTCR in the contemplated transfer and will
not transfer any Executive Stock to the prospective transferee(s) if such
transferee(s) refuses to allow the participation of GTCR.
(ii) The purchase price to be paid by any transferee for shares of
Class B Common and Class A Common transferred in accordance with this paragraph
6(d) shall be determined as follows: (i) the price per share to be paid for
Class B Common included in such Transfer shall be equal to the amount per share
of Class B Common which such transferee has agreed to pay to Executive and (ii)
the price per share to be paid for Class A Common included in such Transfer
shall be the price per share described in clause (i) plus the quotient (the "Per
---- ---
Share Preference") of (A) the sum of the Unreturned Preferred
- ----------------
- 11 -
<PAGE>
Amount and the Unpaid Yield of the Class A Common at such time divided
-------
by (B) the number of shares of Class A Common then outstanding.
--
(e) Permitted Transfers. The restrictions contained in this paragraph
-------------------
6 shall not apply with respect to any Transfer of Executive Stock pursuant to
applicable laws of descent and distribution or among such Executive and such
Executive's Family Members; provided that such restrictions will continue to be
applicable to the Executive Stock after any such transfer and the transferees of
such Executive Stock have agreed in writing to be bound by the provisions of
this Agreement.
(f) Pledges. Notwithstanding the provisions of this paragraph 6,
-------
Executive may pledge any shares of Executive Stock to the Company to secure
payment of the Executive Note.
7. Additional Restrictions on Transfer of Executive Stock.
------------------------------------------------------
(a) Legend. The certificates representing the Executive Stock will
------
bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE
ORIGINALLY ISSUED AS OF JANUARY 31, 1995, HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO
SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN
REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH
IN AN EXECUTIVE STOCK AGREEMENT BETWEEN THE COMPANY, AN
EXECUTIVE OF THE COMPANY, AND A CERTAIN INVESTOR, DATED
AS OF JANUARY 31, 1995. A COPY OF SUCH AGREEMENT MAY BE
OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S PRINCIPAL
PLACE OF BUSINESS WITHOUT CHARGE."
- 12 -
<PAGE>
(b) Opinion of Counsel. No holder of Executive Stock may sell,
------------------
transfer or dispose of any Executive Stock (except pursuant to an effective
registration statement under the Securities Act) without first delivering to the
Company an opinion of counsel (reasonably acceptable in form and substance to
the Company) that (i) neither registration nor qualification under the
Securities Act and applicable state securities laws is required in connection
with such transfer or (ii) all such applicable registration and qualification
requirements have been satisfied.
- 13 -
<PAGE>
PART II: GENERAL PROVISIONS
8. Definitions.
-----------
"Acquisition Agreement" means the agreement by and among the Company,
---------------------
CIC, the stockholders of CIC and the Subsidiary, dated as of January 31, 1995.
"Cause" means (i) a material breach of any agreement with the Company,
-----
its Subsidiaries or its stockholders by Executive (after notice and reasonable
opportunity to cure), (ii) a breach of Executive's duty of loyalty to the
Company or any of its Subsidiaries or any act of dishonesty, gross negligence,
willful misconduct or fraud with respect to the Company or any of its
Subsidiaries or any of their stockholders, customers or suppliers, (iii) the
commission by Executive of a felony, a crime involving moral turpitude or other
act or omission tending to cause harm to the standing and reputation of, or
otherwise bring public disgrace or disrepute to, the Company or any of its
Subsidiaries, (iv) Executive's continued failure or refusal to perform any
material duty to the Company or any of its Subsidiaries which is normally
attached to his position (after notice and reasonable opportunity to cure) or
(v) Executive's gross negligence or willful misconduct in performing those
duties which are normally attached to his position (after notice and reasonable
opportunity to cure). For purposes of this Agreement, "Executive's duty of
loyalty to the Company or any of its Subsidiaries" shall include the Executive's
fiduciary obligation to place the interests of the Company and its Subsidiaries
ahead of his personal interests and thereby not knowingly profit personally at
the expense of the Company or any of its Subsidiaries, and shall also include
specifically the affirmative obligation to disclose promptly to the Board any
known conflicts of interest Executive may have with respect to the Company and
its Subsidiaries, and the negative obligations not to usurp corporate
opportunities of the Company or any of its Subsidiaries, not to engage in any
"conflict-of-interest" transactions with the Company or its Subsidiaries
(without the approval of the board directors), and not to compete directly with
the Company or its Subsidiaries (without the approval of the Board).
"Event of Default" means Event of Default as defined in the Credit
----------------
Agreement, dated as of the date hereof, among Coinmach
- 14 -
<PAGE>
Industries Co., Super Laundry Equipment Co., L.P., Heller Financial, Inc.,
Jackson National Life Insurance Company and Jackson National Life Insurance
Company of Michigan and any similar term in any replacement for, refinancing of,
or modification or amendment to, such Credit Agreement.
"Executive Call Stock" means at any time (i) all equity securities of
-------------------
the Company then held by Executive or a Family Member, (ii) all equity
securities of the Company which at any time have been held by Executive (whether
or not then held by Executive), and (iii) all equity securities of the Company
issued or issuable directly or indirectly with respect to any equity securities
described in clause (i) or (ii) above in connection with a combination of
shares, dividend, recapitalization, merger, consolidation, reorganization or
otherwise; provided that any equity securities which had been Executive Call
--------
Stock and which have been transferred in accordance with the terms of this
Agreement will not be Executive Call Stock at any subsequent time unless held at
the time of determination by Executive or a Family Member.
"Executive Stock" means the shares of the Company's Class B Common
---------------
Stock purchased hereunder.
"Fair Market Value" of each share of Common Stock constituting
-----------------
Executive Stock at the time of valuation means Fair Market Value as defined in
the Stockholders Agreement, except that Operating Cash Flow will be determined
based upon the twelve (12) month period ending on the fiscal quarter end
immediately preceding the date of Termination or of the Noncompete Breach, as
the case may be.
"Family Members" means Executive's spouse and/or lineal descendants, a
--------------
trust for the sole benefit of Executive and/or Executive's spouse or lineal
descendants or upon Executive's death, Executive's estate.
"IRC" means the Internal Revenue Code of 1986, as amended, and any
---
reference to any particular IRC section shall be interpreted to include any
revision of or successor to that section regardless of how numbered or
classified.
- 15 -
<PAGE>
"Original Cost" of each share of Class B Common Stock purchased
-------------
hereunder will be equal to $29.167 (as proportionately adjusted for all
subsequent stock splits, stock dividends and other recapitalizations).
"Public Offering" means the sale in an underwritten public offering
---------------
registered under the Securities Act (other than on Form S-8 or a similar or
successor form) of shares of the Company's Common Stock approved by the Board.
"Public Sale" means any sale pursuant to a registered Public Offering
-----------
under the Securities Act or any sale to the public pursuant to Rule 144
promulgated under the Securities Act effected through a broker, dealer or market
maker.
"Registration Agreement" means the Registration Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Executive.
"Restriction Lapse Date" means the earlier of (i) the fifth
----------------------
anniversary of the date of this Agreement and (ii) the date of the closing of
any Public Offering.
"Securities Act" means the Securities Act of 1933, as amended from
--------------
time to time.
"Securities Exchange Act" means the Securities Exchange Act of 1934,
-----------------------
as amended from time to time.
"Stockholders Agreement" means the Stockholders Agreement dated as of
----------------------
the date hereof among the Company, the Investors (as defined in that Agreement)
and Executive.
"Subsidiary" means, with respect to any Person, any corporation,
----------
partnership, association or other business entity of which (i) if a corporation,
a majority of the total voting power of shares of stock entitled (without regard
to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof, or (ii) if a partnership, association or other
business entity, a majority of the partnership or other similar ownership
interest thereof is at the time owned or
- 16 -
<PAGE>
controlled, directly or indirectly, by any Person or one or more Subsidiaries of
that Person or a combination thereof. For purposes hereof, a Person or Persons
shall be deemed to have a majority ownership interest in a partnership,
association or other business entity if such Person or Persons shall be
allocated a majority of partnership, association or other business entity gains
or losses or shall be or control the managing director or general partner of
such partnership, association or other business entity.
"Transfer" means to sell, transfer, assign, pledge or otherwise
--------
dispose of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law).
"Unreturned Preferred Amount" means the "Unreturned Preferred Amount"
---------------------------
as defined in the Company's Certificate of Incorporation.
"Unpaid Yield" means the "Unpaid Yield" as defined in the Company's
------------
Certificate of Incorporation.
9. Notices. Any notice provided for in this Agreement must be in
-------
writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to each person at the address set forth below:
If to the Company:
-----------------
The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
Attention: President
With a copy (which will constitute notice to the Company) to:
------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
- 17 -
<PAGE>
If to the Executive:
-------------------
David Tulkop
c/o The Coinmach Corporation
55 Lumber Road
Roslyn, New York 11576
With a copy (which will not constitute notice to Executive) to:
--------------------------------------------------------------
Anderson Kill Olick & Oshinsky, P.C.
1251 Avenue of the Americas
New York, New York 10020
Attention: Ronald S. Brody, Esq.
If to GTCR:
----------
Golder, Thoma, Cressey, Rauner Fund IV, L.P.
6100 Sears Tower
Chicago, Illinois 60606
Attention: Bruce V. Rauner
David A. Donnini
with a copy (which will not constitute notice to GTCR) to:
---------------------------------------------------------
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Kevin R. Evanich, Esq.
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement will be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S. mail.
10. General Provisions.
------------------
(a) Transfers in Violation of Agreement. Any Transfer or
-----------------------------------
attempted Transfer of any Executive Stock in violation of any provision of this
Agreement shall be void, and the Company shall not record such Transfer on its
books or treat any purported
- 18 -
<PAGE>
transferee of such Executive Stock as the owner of such stock for any
purpose.
(b) Severability. Whenever possible, each provision of this
------------
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or any other jurisdiction, but this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
(c) Complete Agreement. This Agreement, those documents expressly
------------------
referred to herein and other documents of even date herewith (i) embody the
complete agreement and understanding among the parties and (ii) supersede and
preempt any prior summaries of terms and conditions, understandings, agreements
or representations by or among the parties, written or oral, which may have
related to the subject matter hereof in any way.
(d) Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
(e) Successors and Assigns. Except as otherwise provided herein, this
----------------------
Agreement shall bind Executive and the Company and their respective successors
and permitted assigns and inure to the benefit of and be enforceable by
Executive, the Company, GTCR and their respective successors and permitted
assigns (including in each case subsequent holders of Executive Stock); provided
--------
that Executive may not assign any of his rights under any other provision of
Part I of this Agreement except as part of a Transfer of Executive Stock in
accordance with paragraphs 5 or 6.
(f) Choice of Law. The corporate law of the State of Delaware will
-------------
govern all questions concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity and
interpretation of this Agreement and the exhibits hereto will be governed by and
construed in accordance with the internal laws of the State of Illinois,
- 19 -
<PAGE>
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Illinois or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
Illinois.
(g) Remedies. Each of the parties to this Agreement will be entitled
--------
to enforce its rights under this Agreement specifically, to recover damages and
costs (including attorney's fees) caused by any breach of any provision of this
Agreement and to exercise all other rights existing in its favor. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and, except as otherwise
provided in paragraph 10(d), that any party may in its sole discretion apply to
any court of law or equity of competent jurisdiction (without posting any bond
or deposit) for specific performance and/or other injunctive relief in order to
enforce or prevent any violations of the provisions of this Agreement.
(h) Amendment and Waiver. Except as otherwise expressly provided
--------------------
herein, the provisions of this Agreement may be amended or modified only by
written agreement of the Company, Executive and GTCR. No other course of dealing
between the parties or third-party beneficiaries hereof or any delay in
exercising any rights hereunder shall operate as a waiver of any rights of any
such holders.
(i) Survival of Representations and Warranties. All representations
------------------------------------------
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by Executive or on his behalf or by the Company or on its
behalf.
(j) Business Days. If any time period for giving notice or taking
-------------
action hereunder expires on a day which is a Saturday, Sunday or holiday in the
state in which the Company's chief executive office is located, the time period
shall be automatically extended to the business day immediately following such
Saturday, Sunday or holiday.
(k) Descriptive Headings; Interpretation. The descriptive headings of
------------------------------------
this Agreement are inserted for convenience only
- 20 -
<PAGE>
and do not constitute a Section of this Agreement. The use of the word
"including" in this Agreement shall be by way of example rather than by
limitation.
* * * * *
- 21 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first written above.
THE COINMACH CORPORATION
By /S/ ROBERT M. DOYLE
------------------------
Its Vice President
------------------------
GOLDER, THOMA, CRESSEY, RAUNER
FUND IV, L.P.
By: GTCR IV, L.P.
Its: General Partner
By: Golder, Thoma, Cressey,
Rauner, Inc.
Its: General Partner
By: /S/ CARL D. THOMAS
---------------------------
Its: Principal
EXECUTIVE
/S/ DAVID TULKOP
------------------------------
David Tulkop
<PAGE>
CONSENT
-------
The undersigned spouse of Executive hereby acknowledges that I have
read the foregoing Executive Stock Agreement and that I understand its contents.
I am aware that the Agreement provides for the repurchase of my spouse's shares
of Common Stock under certain circumstances and imposes other restrictions on
the transfer of such Common Stock. I agree that my spouse's interest in the
Common Stock subject to this Agreement and any interest I may have in such
Common Stock shall be irrevocably bound by this Agreement and further that my
community or marital property interest, if any, shall be similarly bound by this
Agreement.
/S/ JEANNETTE TULKOP
---------------------------
Spouse's Name:
/S/ KELLY A. NEWELL
----------------------------
Witness
<PAGE>
EXHIBIT 37
PROMISSORY NOTE
---------------
$52,369.52 July 26, 1995
For value received, MCS Capital, Inc. ("Maker") promises to pay to the
order of SAS Acquisitions Inc., a Delaware corporation (the "Company"), at its
offices in Roslyn, New York, or such other place as designated in writing by the
holder hereof, the aggregate principal sum of $52,369.52. Maker will pay the
aggregate principal sum in eight equal payments of $6,546.19 on each of the
first eight anniversary dates of the date hereof and, on each such date, Maker
will pay interest accrued through such date at the rate specified below. This
Note was issued pursuant to and is subject to the terms of the Executive Stock
Agreement, dated as of July 26, 1995, among the Company and Maker and certain
other Purchasers named therein.
Interest will accrue on the outstanding principal amount of this Note at
a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 4,000 shares
of the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
MCS CAPITAL INC.
By: STEPHEN R. KERRIGAN
----------------------
Its: President
----------------------
Dated: July 26, 1995
<PAGE>
Guaranty
The undersigned hereby unconditionally, absolutely and irrevocably
guarantees the full and punctual payment and performance of all indebtedness,
obligations and liabilities of Maker under this Note and of any other person
liable hereon regardless of the validity or enforceability of such indebtedness,
obligations and liabilities of Maker or other liable person, and the undersigned
hereby waives acceptance or notice of acceptance of this guarantee, presentment,
demand for payment or performance, protest any notice of dishonor with respect
to the indebtedness, obligations and liabilities guaranteed hereby and agrees
that without releasing or otherwise affecting in any manner the undersigned's
liability hereunder, any holder of this Note may, without the consent of the
undersigned, modify and amend the terms of this Note, take and release
collateral in whole or in part, extend the time of payment and otherwise grant
waivers and indulgences in respect hereof, release the Maker or any other liable
party from liability hereunder, in whole or in part, and pursue the enforcement
of this guarantee against the undersigned (including without limitation by
judicial proceedings) without prior recourse to or joinder of Maker or any other
person liable hereunder.
Dated : July 26, 1995 /s/ STEPHEN R. KERRIGAN
----------------------------
Stephen R. Kerrigan
<PAGE>
EXHIBIT 38
PROMISSORY NOTE
---------------
$52,369.52 July 26, 1995
For value received, Mitchell Blatt ("Maker") promises to pay to the
order of SAS Acquisitions Inc., a Delaware corporation (the "Company"), at its
offices in Roslyn, New York, or such other place as designated in writing by the
holder hereof, the aggregate principal sum of $52,369.52. Maker will pay the
aggregate principal sum in eight equal payments of 6,546.19 on each of the first
eight anniversary dates of the date hereof and, on each such date, Maker will
pay interest accrued through such date at the rate specified below. This Note
was issued pursuant to and is subject to the terms of the Executive Stock
Agreement, dated as of July 26, 1995, among the Company and Maker and certain
other Purchasers named therein.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the
principal of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 4,000
shares of the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all
costs of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ MITCHELL BLATT
----------------------
Mitchell Blatt
Dated: July 26, 1995
--
<PAGE>
EXHIBIT 39
PROMISSORY NOTE
---------------
$26,184.80 July 26, l995
For value received, Robert M. Doyle ("Maker") promises to pay to the
order of SAS Acquisitions Inc., a Delaware corporation (the "Company"), at its
offices in Roslyn, New York, or such other place as designated in writing by the
holder hereof, the aggregate principal sum of $26,184.80. Maker will pay the
aggregate principal sum in eight equal payments of $3,273.10 on each of the
first eight anniversary dates of the date hereof and, on each such date, Maker
will pay interest accrued through such date at the rate specified below. This
Note was issued pursuant to and is subject to the terms of the Executive Stock
Agreement, dated as of July 26, 1995, among the Company and Maker and certain
other Purchasers named therein.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the
principal of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 2,000
shares of the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ ROBERT M. DOYLE
---------------------------
Robert M. Doyle
Dated: July 26, 1995
<PAGE>
EXHIBIT 40
PROMISSORY NOTE
---------------
$19,638.56 July 26, 1995
For value received, Michael Stanky ("Maker") promises to pay to the
order of SAS Acquisitions Inc., a Delaware corporation (the "Company"), at its
offices in Roslyn, New York, or such other place as designated in writing by the
holder hereof, the aggregate principal sum of $l9,638.56. Maker will pay the
aggregate principal sum in eight equal payments of $2,454.82 on each of the
first eight anniversary dates of the date hereof and, on each such date, Maker
will pay interest accrued through such date at the rate specified below. This
Note was issued pursuant to and is subject to the terms of the Executive Stock
Agreement, dated as of July 26, 1995, among the Company and Maker and certain
other Purchasers named therein.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 1,500 shares
of the Company's Class B Common Stock.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without
in any way affecting the liability of Maker hereunder.
<PAGE>
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ MICHAEL STANKY
------------------------
Michael Stanky
<PAGE>
EXHIBIT 41
STOCK SUBSCRIPTION AGREEMENT
The undersigned hereby subscribes for 1,415 shares of Class B common
stock, par value $.01 per share (the "Common Stock"), of Coinmach Laundry
Corporation, a Delaware corporation, at a purchase price of $15.40 per share and
agrees to pay therefor total consideration of $21,794.96 in the form of a
Promissory Note, dated the date hereof (the "Promissory Note"), in favor of
Coinmach Laundry Corporation, attached hereto as Exhibit A. The issuance of the
---------
Common Stock is subject to the terms and conditions of the Promissory Note.
Dated: As of May 10, 1996
/s/ MITCHELL BLATT
________________________
Mitchell Blatt
Accepted:
COINMACH LAUNDRY CORPORATION
/s/ ROBERT M. DOYLE
By: _______________________
Robert M. Doyle
Senior Vice President
<PAGE>
EXHIBIT 42
STOCK SUBSCRIPTION AGREEMENT
The undersigned hereby subscribes for 599 shares of Class B common
stock, par value $.01 per share (the "Common Stock"), of Coinmach Laundry
Corporation, a Delaware corporation, at a purchase price of $15.40 per share and
agrees to pay therefor total consideration of $9,226.28 in the form of a
Promissory Note, dated the date hereof (the "Promissory Note"), in favor of
Coinmach Laundry Corporation, attached hereto as Exhibit A. The issuance of the
---------
Common Stock is subject to the terms and conditions of the Promissory Note.
Dated: As of May 10, 1996
/s/ ROBERT M. DOYLE
________________________
Robert M. Doyle
Accepted:
COINMACH LAUNDRY CORPORATION
/s/ STEPHEN R. KERRIGAN
By: _______________________
Stephen R. Kerrigan
Chief Executive Officer
<PAGE>
EXHIBIT 43
STOCK SUBSCRIPTION AGREEMENT
The undersigned hereby subscribes for 1,415 shares of Class B common
stock, par value $.01 per share (the "Common Stock"), of Coinmach Laundry
Corporation, a Delaware corporation, at a purchase price of $15.40 per share and
agrees to pay therefor total consideration of $21,794.96 in the form of a
Promissory Note, dated the date hereof (the "Promissory Note"), in favor of
Coinmach Laundry Corporation, attached hereto as Exhibit A. The issuance of the
---------
Common Stock is subject to the terms and conditions of the Promissory Note.
Dated: As of May 10, 1996
MCS CAPITAL, INC.
/s/ STEPHEN R. KERRIGAN
By: ________________________
Stephen R. Kerrigan
President
Accepted:
COINMACH LAUNDRY CORPORATION
/s/ ROBERT M. DOYLE
By: _______________________
Robert M. Doyle
Senior Vice President
<PAGE>
EXHIBIT 44
PROMISSORY NOTE
---------------
$21,794.96 May 10, 1996
For value received, Mitchell Blatt ("Maker") promises to pay to the
order of Coinmach Laundry Corporation, a Delaware corporation (the "Company"),
at its offices in Roslyn, New York, or such other place as designated in writing
by the holder hereof, the aggregate principal sum of $21,794.96. Maker will pay
the aggregate principal sum in eight equal payments of $2,724.37 on each of the
first eight anniversary dates of the date hereof and, on each such date, Maker
will pay interest accrued through such date at the rate specified below.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 1,415
shares of the Company's Class B Common Stock, par value $.01 share ("Common
Stock") issued to the Maker on the date hereof. Such shares of Common Stock
shall remain in the possession of the Company until this Promissory Note is paid
in full.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ MITCHELL BLATT
______________________________
Mitchell Blatt
<PAGE>
EXHIBIT 45
PROMISSORY NOTE
---------------
$9,226.28 May 10, 1996
For value received, Robert M. Doyle ("Maker") promises to pay to the
order of Coinmach Laundry Corporation, a Delaware corporation (the "Company"),
at its offices in Roslyn, New York, or such other place as designated in writing
by the holder hereof, the aggregate principal sum of $9,226.28. Maker will pay
the aggregate principal sum in eight equal payments of $1,153.29 on each of the
first eight anniversary dates of the date hereof and, on each such date, Maker
will pay interest accrued through such date at the rate specified below.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 599 shares
of the Company's Class B Common Stock, par value $.01 per share ("Common Stock")
issued to the Maker on the date hereof. Such shares of Common Stock shall
remain in the possession of the Company until this Promissory Note is paid in
full.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
/s/ ROBERT M. DOYLE
______________________________
Robert M. Doyle
<PAGE>
EXHIBIT 46
PROMISSORY NOTE
---------------
$21,794.96 May 10, 1996
For value received, MCS Capital, Inc. ("Maker") promises to pay to the
order of Coinmach Laundry Corporation, a Delaware corporation (the "Company"),
at its offices in Roslyn, New York, or such other place as designated in writing
by the holder hereof, the aggregate principal sum of $21,794.96. Maker will pay
the aggregate principal sum in eight equal payments of $2,724.37 on each of the
first eight anniversary dates of the date hereof and, on each such date, Maker
will pay interest accrued through such date at the rate specified below.
Interest will accrue on the outstanding principal amount of this Note
at a rate equal to the lesser of (i) 8% per annum or (ii) the highest rate
permitted by applicable law, and shall be payable at such time as the principal
of this Note becomes due and payable.
The amounts due under this Note are secured by a pledge of 1,415
shares of the Company's Class B Common Stock, par value $.01 per share ("Common
Stock") issued to the Maker on the date hereof. Such shares of Common Stock
shall remain in the possession of the Company until this Promissory Note is paid
in full.
In the event Maker fails to pay any amounts due hereunder when due,
Maker shall pay to the holder hereof, in addition to such amounts due, all costs
of collection, including reasonable attorneys fees.
Maker, or his successors and assigns, hereby waives diligence,
presentment, protest and demand and notice of protest, demand, dishonor and
nonpayment of this Note, and expressly agrees that this Note, or any payment
hereunder, may be extended from time to time and that the holder hereof may
accept security for this Note or release security for this Note, all without in
any way affecting the liability of Maker hereunder.
This Note shall be governed by the internal laws, not the laws of
conflicts, of the State of New York.
MCS CAPITAL, INC.
/s/ STEPHEN R. KERRIGAN
______________________________
Stephen R. Kerrigan
President
<PAGE>
EXHIBIT 47
COMMON STOCK PURCHASE AGREEMENT
-------------------------------
THIS AGREEMENT (the "Agreement") is made and entered into as of the 10th
---------
day of July, 1996, by and between MCS Capital Management, Inc., a Delaware
corporation (the "Company"), and Robert M. Doyle (the "Purchaser").
------- ---------
Recitals
--------
WHEREAS, the Company desires to sell and Purchaser desires to purchase
316.2720 shares of Class F common stock, par value $.01 per share (the "CLC
---
Common Stock"), of Coinmach Laundry Corporation (formerly SAS Acquisitions
- ------------
Inc.), a Delaware corporation.
Agreement
---------
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
1. Purchase, Sale and Delivery of Common Stock.
-------------------------------------------
(a) On the terms and subject to the conditions of this Agreement,
Purchaser agrees to purchase from the Company and the Company agrees to sell to
Purchaser, 316.2720 shares of CLC Common Stock for a purchase price of $10.00
(the "Purchase Price").
--------------
(b) On the date hereof, (i) the Company shall deliver to Purchaser one
or more certificates representing the CLC Common Stock purchased and sold
hereunder, endorsed in Purchaser's name, and (ii) Purchaser shall pay the
Purchase Price to the Company.
2. Representations and Warranties of Purchaser.
-------------------------------------------
Purchaser hereby represents and warrants to the Company that Purchaser is
purchasing the CLC Common Stock for its own account and not with a view to any
resale or distribution of the CLC Common Stock purchased and sold hereunder that
would violate the Securities Act, and acknowledges that there are substantial
restrictions on the transferability of such CLC Common Stock, and it understands
that such CLC Common Stock has not been registered under the Securities Act and
that certificates representing such CLC Common Stock initially will bear the
legend and be subject to
1
<PAGE>
the restrictions on transfer and sale set forth in Section 3 of this Agreement.
3. Certificates for Securities and Legend. The certificates
--------------------------------------
representing the CLC Common Stock will initially bear the following legend:
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO
REQUESTS THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL, OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND
THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR
RIGHTS.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A STOCKHOLDERS
AGREEMENT DATED AS OF JULY 26, 1995, AS AMENDED FROM TIME TO TIME, AMONG THE
ISSUER OF SUCH SECURITIES (THE "COMPANY") AND CERTAIN OF THE COMPANY'S
STOCKHOLDERS. A COPY OF SUCH STOCKHOLDERS AGREEMENT SHALL BE FURNISHED
WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER
AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE AGREEMENT AMONG
THE COINMACH CORPORATION, THE INITIAL HOLDER OF THIS CERTIFICATE AND A CERTAIN
INVESTOR, DATED AS OF JANUARY 31, 1995, AS AMENDED FROM TIME TO TIME. A COPY
OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S
PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
4. Notices. All notices and other communications hereunder shall be
-------
in writing and shall only be deemed to have been duly given if mailed by
registered or certified mail or transmitted by any standard form of
telecommunication and if addressed, in the case of notices to Purchaser, to
Purchaser at the address appearing on the signature page hereof; and, in the
case of the Company, to it at the address appearing on the signature page
hereof.
5. Parties and Beneficiaries. This Agreement shall inure to the
-------------------------
benefit of and be binding upon the Company, Purchaser and their respective
successors and assigns.
2
<PAGE>
6. Applicable Law. This Agreement shall be governed by, and construed
--------------
in accordance with, the laws of the State of New York.
7. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
8. Section Headings. The section headings in this Agreement are for
----------------
convenience of reference only and shall not be deemed to alter or affect any
provision hereof.
[SIGNATURE PAGE FOLLOWS]
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date and year first above written.
/s/ ROBERT M. DOYLE
__________________________
Robert M. Doyle
Address: 55 Lumber Road
Roslyn, NY 11576
MCS CAPITAL MANAGEMENT, INC.
/s/ STEPHEN R. KERRIGAN
By:______________________
Stephen R. Kerrigan
President
4
<PAGE>
EXHIBIT 48
COMMON STOCK PURCHASE AGREEMENT
-------------------------------
THIS AGREEMENT (the "Agreement") is made and entered into as of the 10th
---------
day of July, 1996, by and between MCS Capital Management, Inc., a Delaware
corporation (the "Company"), and S.A. Spencer (the "Purchaser").
------- ---------
Recitals
--------
WHEREAS, the Company desires to sell and Purchaser desires to purchase
1,054.2399 shares of Class F common stock, par value $.01 per share (the "CLC
---
Common Stock"), of Coinmach Laundry Corporation (formerly SAS Acquisitions
- ------------
Inc.), a Delaware corporation.
Agreement
---------
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
1. Purchase, Sale and Delivery of Common Stock.
-------------------------------------------
(a) On the terms and subject to the conditions of this Agreement,
Purchaser agrees to purchase from the Company and the Company agrees to sell to
Purchaser, 1,054.2399 shares of CLC Common Stock for a purchase price of $10.00
(the "Purchase Price").
--------------
(b) On the date hereof, (i) the Company shall deliver to Purchaser one
or more certificates representing the CLC Common Stock purchased and sold
hereunder, endorsed in Purchaser's name, and (ii) Purchaser shall pay the
Purchase Price to the Company.
2. Representations and Warranties of Purchaser.
-------------------------------------------
Purchaser hereby represents and warrants to the Company that Purchaser is
purchasing the CLC Common Stock for its own account and not with a view to any
resale or distribution of the CLC Common Stock purchased and sold hereunder that
would violate the Securities Act, and acknowledges that there are substantial
restrictions on the transferability of such CLC Common Stock, and it understands
that such CLC Common Stock has not been registered under the Securities Act and
that certificates representing such CLC Common Stock initially will bear the
legend and be subject to
<PAGE>
the restrictions on transfer and sale set forth in Section 3 of this Agreement.
3. Certificates for Securities and Legend. The certificates
--------------------------------------
representing the CLC Common Stock will initially bear the following legend:
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO
REQUESTS THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL, OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND
THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR
RIGHTS.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A STOCKHOLDERS
AGREEMENT DATED AS OF JULY 26, 1995, AS AMENDED FROM TIME TO TIME, AMONG THE
ISSUER OF SUCH SECURITIES (THE "COMPANY") AND CERTAIN OF THE COMPANY'S
STOCKHOLDERS. A COPY OF SUCH STOCKHOLDERS AGREEMENT SHALL BE FURNISHED
WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER
AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE AGREEMENT AMONG
THE COINMACH CORPORATION, THE INITIAL HOLDER OF THIS CERTIFICATE AND A CERTAIN
INVESTOR, DATED AS OF JANUARY 31, 1995, AS AMENDED FROM TIME TO TIME. A COPY
OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S
PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
4. Notices. All notices and other communications hereunder shall be
-------
in writing and shall only be deemed to have been duly given if mailed by
registered or certified mail or transmitted by any standard form of
telecommunication and if addressed, in the case of notices to Purchaser, to
Purchaser at the address appearing on the signature page hereof; and, in the
case of the Company, to it at the address appearing on the signature page
hereof.
5. Parties and Beneficiaries. This Agreement shall inure to the
-------------------------
benefit of and be binding upon the Company, Purchaser and their respective
successors and assigns.
2
<PAGE>
6. Applicable Law. This Agreement shall be governed by, and construed
--------------
in accordance with, the laws of the State of New York.
7. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
8. Section Headings. The section headings in this Agreement are for
----------------
convenience of reference only and shall not be deemed to alter or affect any
provision hereof.
[SIGNATURE PAGE FOLLOWS]
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date and year first above written.
/s/ S.A. SPENCER
__________________________
S.A. Spencer
Address: c/o Holding Capital Group, Inc.
685 Fifth Avenue
New York, New York 10022
MCS CAPITAL MANAGEMENT, INC.
/s/ STEPHEN R. KERRIGAN
By: _______________________
Stephen R. Kerrigan
President
4
<PAGE>
EXHIBIT 49
COMMON STOCK PURCHASE AGREEMENT
-------------------------------
THIS AGREEMENT (the "Agreement") is made and entered into as of the 10th
---------
day of July, 1996, by and between MCS Capital Management, Inc., a Delaware
corporation (the "Company"), and MCS Capital, Inc., a Delaware corporation (the
-------
"Purchaser").
---------
Recitals
--------
WHEREAS, the Company desires to sell and Purchaser desires to purchase
737.9679 shares of Class F common stock, par value $.01 per share (the "CLC
---
Common Stock"), of Coinmach Laundry Corporation (formerly SAS Acquisitions
- ------------
Inc.), a Delaware corporation.
Agreement
---------
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereby agree as follows:
1. Purchase, Sale and Delivery of Common Stock.
-------------------------------------------
(a) On the terms and subject to the conditions of this Agreement,
Purchaser agrees to purchase from the Company and the Company agrees to sell to
Purchaser, 737.9679 shares of CLC Common Stock for a purchase price of $10.00
(the "Purchase Price").
--------------
(b) On the date hereof, (i) the Company shall deliver to Purchaser one
or more certificates representing the CLC Common Stock purchased and sold
hereunder, endorsed in Purchaser's name, and (ii) Purchaser shall pay the
Purchase Price to the Company.
2. Representations and Warranties of Purchaser.
-------------------------------------------
Purchaser hereby represents and warrants to the Company that Purchaser is
purchasing the CLC Common Stock for its own account and not with a view to any
resale or distribution of the CLC Common Stock purchased and sold hereunder that
would violate the Securities Act, and acknowledges that there are substantial
restrictions on the transferability of such CLC Common Stock, and it understands
that such CLC Common Stock has not been registered under the Securities Act and
that certificates representing such CLC
1
<PAGE>
Common Stock initially will bear the legend and be subject to the restrictions
on transfer and sale set forth in Section 3 of this Agreement.
3. Certificates for Securities and Legend. The certificates
--------------------------------------
representing the CLC Common Stock will initially bear the following legend:
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO
REQUESTS THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL, OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND
THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR
RIGHTS.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A STOCKHOLDERS
AGREEMENT DATED AS OF JULY 26, 1995, AS AMENDED FROM TIME TO TIME, AMONG THE
ISSUER OF SUCH SECURITIES (THE "COMPANY") AND CERTAIN OF THE COMPANY'S
STOCKHOLDERS. A COPY OF SUCH STOCKHOLDERS AGREEMENT SHALL BE FURNISHED
WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED
BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER
AND CERTAIN OTHER AGREEMENTS SET FORTH IN AN INVESTOR PURCHASE AGREEMENT AMONG
THE COINMACH CORPORATION, THE INITIAL HOLDER OF THIS CERTIFICATE AND A CERTAIN
INVESTOR, DATED AS OF JANUARY 31, 1995, AS AMENDED FROM TIME TO TIME. A COPY
OF SUCH AGREEMENT MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUER'S
PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
4. Notices. All notices and other communications hereunder shall be
-------
in writing and shall only be deemed to have been duly given if mailed by
registered or certified mail or transmitted by any standard form of
telecommunication and if addressed, in the case of notices to Purchaser, to
Purchaser at the address appearing on the signature page hereof; and, in the
case of the Company, to it at the address appearing on the signature page
hereof.
5. Parties and Beneficiaries. This Agreement shall inure to the
-------------------------
benefit of and be binding upon the Company, Purchaser and their respective
successors and assigns.
2
<PAGE>
6. Applicable Law. This Agreement shall be governed by, and construed
--------------
in accordance with, the laws of the State of New York.
7. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original, but such counterparts shall
together constitute but one and the same instrument.
8. Section Headings. The section headings in this Agreement are for
----------------
convenience of reference only and shall not be deemed to alter or affect any
provision hereof.
[SIGNATURE PAGE FOLLOWS]
3
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date and year first above written.
MCS CAPITAL, INC.
/s/ STEPHEN R. KERRIGAN
By:________________________
Name: Stephen R. Kerrigan
Title: President
Address: 55 Lumber Road
Roslyn, NY 11576
MCS CAPITAL MANAGEMENT, INC.
/s/ STEPHEN R. KERRIGAN
By: _____________________
Stephen R. Kerrigan
President
4
<PAGE>
EXHIBIT 52
COINMACH LAUNDRY CORPORATION
SECOND AMENDED AND RESTATED
---------------------------
1996 EMPLOYEE STOCK OPTION PLAN
-------------------------------
ARTICLE 1
IDENTIFICATION OF THE PLAN
1.1 Title. The plan described herein shall be known as the Coinmach
-----
Laundry Corporation Second Amended and Restated 1996 Employee Stock Option Plan
(the "Plan").
----
1.2 Purpose. The purpose of this Plan is (i) to compensate certain
-------
officers and employees of Coinmach Laundry Corporation (the "Company") and its
-------
Subsidiaries for services rendered by such persons after the date of adoption of
this Plan to the Company or any Subsidiary; (ii) to provide certain officers and
employees of the Company and its Subsidiaries with significant additional
incentive to promote the financial success of the Company; and (iii) to provide
an incentive which may be used to induce able persons to enter into or remain in
the employment of the Company or any Subsidiary.
1.3 Effective Date. The Plan shall become effective on July 23, 1996 (the
--------------
"Effective Date"). The Plan, however, is subject to approval by the
--------------
stockholders of the Company. If stockholder approval is not granted within
twelve (12) months from the date of its adoption by the Board, the Plan shall
thereupon terminate. Grants of Options may be made prior to stockholder
approval, but any such Options granted shall not be exercisable prior to
stockholder approval and shall terminate without any further action by the
Company if stockholder approval is not given.
1.4 Defined Terms. Certain capitalized terms used herein have the
-------------
meanings as set forth in Section 10.1 of the Plan.
ARTICLE 2
ADMINISTRATION OF THE PLAN
2.1 Committee's Powers. This Plan shall be administered by a committee
------------------
(the "Committee") composed of persons appointed by the Board of Directors of the
---------
Company in accordance with the provisions of Section 2.2. The Committee shall
have full power and authority to prescribe, amend and rescind rules and
procedures governing administration of this Plan. The Committee shall have full
power and authority (i) to interpret the terms of this Plan, the terms of the
Options and the rules and procedures established by the Committee and (ii) to
determine the meaning of or requirements imposed by or rights of any person
under this Plan, any Option or any rule or procedure established by the
Committee. Each action of the Committee which is within the scope of the
authority delegated to the Committee by this Plan or by the Board shall be
binding on all persons.
-1-
<PAGE>
2.2 Committee Membership. The Committee shall be composed of two or more
--------------------
members of the Board, each of whom is a "disinterested person," as defined in
Securities and Exchange Commission Rule 16b-3, as amended ("Rule 16b-3"), or any
successor rules or government pronouncements. The Board shall have the power to
determine the number of members which the Committee shall have and to change the
number of membership positions on the Committee from time to time. The Board
shall appoint all members of the Committee. The Board may from time to time
appoint members to the Committee in substitution for, or in addition to, members
previously appointed and may fill vacancies, however caused, on the Committee.
Any member of the Committee may be removed from the Committee by the Board at
any time with or without cause. If at any time no special committee has been
constituted by the Board especially for the purposes of this Plan, then the
members of the Board who are "disinterested persons" as defined in Rule 16b-3
shall have all powers and rights delegated to the "Committee" under this Plan.
Notwithstanding anything to the contrary in this Section 2.2, the Committee
shall not grant an Option to a Section 16 Holder unless the Committee is
constituted so as to comply with Securities and Exchange Commission Rule 16b-3,
as amended, or any successor rules or government pronouncements.
2.3 Committee Procedures. The Committee shall hold its meetings at such
--------------------
times and places as it may determine. The Committee may make such rules and
regulations for the conduct of its business as it shall deem advisable. Unless
the Board or the Committee expressly decides to the contrary, a majority of the
members of the Committee shall constitute a quorum and any action taken by a
majority of the Committee members in attendance at a meeting at which a quorum
of Committee members are present shall be deemed an act of the Committee.
2.4 Indemnification. No member of the Committee shall be liable, in the
---------------
absence of bad faith, for any act or omission with respect to his or her service
on the Committee under this Plan. Service on the Committee shall constitute
service as a director of the Company so that the members of the Committee shall
be entitled to indemnification and reimbursements as directors of the Company
for any action or any failure to act in connection with service on the Committee
to the full extent provided for at any time in the Company's Certificate of
Incorporation and By-Laws, or in any insurance policy or other agreement
intended for the benefit of the Company's directors.
ARTICLE 3
EMPLOYEES ELIGIBLE TO RECEIVE OPTIONS
A person shall be eligible to be granted an Option only if on the proposed
Granting Date for such option such person is a full-time, salaried employee of
the Company or any Subsidiary, excluding non-management directors of the
Company. A person eligible to be granted an Option is herein called a "Key
---
Employee."
- --------
ARTICLE 4
GRANT OF OPTIONS
4.1 Power to Grant Options. The Committee shall have the right and the
----------------------
power to grant at any time to any Key Employee an option entitling such person
to purchase Common Stock from the Company in such quantity, at such price, on
such terms and subject to such conditions
-2-
<PAGE>
consistent with the provisions of this Plan as may be established by the
Committee on or prior to the Granting Date for such option. Each option to
purchase Common Stock which shall be granted by the Committee pursuant to the
provisions of this Plan is herein called an "Option."
------
4.2 Granting Date. An Option shall be deemed to have been granted under
-------------
this Plan on the date (the "Granting Date") which the Committee designates as
-------------
the Granting Date at the time it approves such Option, provided that the
Committee may not designate a Granting Date with respect to any Option which is
earlier than the date on which the granting of such Option is approved by the
Committee.
4.3 Option Terms Which The Committee May Determine. The Committee shall
----------------------------------------------
have the power to determine the Key Employee to whom Options are granted, the
number of Shares subject to each Option, the number of Options awarded to each
Key Employee and the time at which each Option is granted. Except as otherwise
expressly provided in this Plan, the Committee shall also have the power to
determine, at the time of the grant of each Option, all terms and conditions
governing the rights and obligations of the holder with respect to such Option,
including but not limited to: (a) the purchase price per Share or the method by
which the purchase price per Share will be determined; (b) the length of the
period during which the Option may be exercised and any limitations on the
number of Shares purchasable with the Option at any given time during such
period; (c) the times at which the Option may be exercised; (d) any conditions
precedent to be satisfied before the Option may be exercised, such as vesting
period; (e) any restrictions on resale of any Shares purchased upon exercise of
the Option; and (f) whether the Option will constitute an Incentive Stock
Option.
4.4 Option Agreement. No person shall have any rights under any Option
----------------
unless and until the Company and the person to whom such Option is granted have
executed and delivered an agreement expressly granting the Option to such person
and containing provisions setting forth the terms of the Option (an "Option
------
Agreement").
- ---------
ARTICLE 5
OPTION TERMS
5.1 Plan Provisions Control Option Terms. The terms of this Plan shall
------------------------------------
govern all the Options. In the event any provision of any Option Agreement
conflicts with any term in this Plan as constituted on the Granting Date of such
Option, the term in this Plan as constituted on the Granting Date of the Option
shall control. Except as provided in Article 8, the terms of any Option may not
be changed after the Granting Date of such Option without the express approval
of the Company and the Option Holder.
5.2 Price Limitation. Subject to Article 8, the price at which each Share
----------------
may be purchased upon the exercise of any Option may not be less than the Per
Share Market Value on the Granting Date for such Option.
5.3 Term Limitation. No Incentive Stock Option may be granted under this
---------------
Plan which is exercisable more than ten years after its Granting Date. This
Section 5.3 shall not be deemed to limit the term which the Committee may
specify for any Options granted under the Plan which are not intended to be
Incentive Stock Options.
-3-
<PAGE>
5.4 Transfer Limitations. No Option granted pursuant to this Plan shall
--------------------
be transferable other than by will or the laws of descent and distribution or
exercisable during the lifetime of the person to whom the Option is initially
granted by anyone other than the initial grantee. It shall be a condition
precedent to any transfer of any Option in accordance with the immediately
preceding sentence that the transferee executes and delivers an agreement
acknowledging such Option has been acquired for investment and not for
distribution and is and shall remain subject to this Plan and the Option
Agreement. The "Holder" of any Option shall mean (i) the initial grantee of
------
such Option or (ii) any permitted transferee.
5.5 $100,000 Per Year Limit on Incentive Stock Options. No Key Employee
--------------------------------------------------
may be granted Incentive Stock Options if the value of the Shares subject to
those options which first become exercisable in any given calendar year (and the
value of the Shares subject to any other Incentive Stock Options issued to the
Key Employee under the Plan or any other plan of the Company or its Subsidiaries
which first become exercisable in such year) exceeds $100,000. For this
purpose, the value of Shares shall be determined on the Granting Date. Any
Incentive Stock Options issued in excess of the $100,000 limit shall be treated
as Options that are not Incentive Stock Options. Incentive Stock Options shall
be taken into account in the order in which they were granted.
5.6 No Right to Employment Conferred. Nothing in this Plan or (in the
--------------------------------
absence of an express provision to the contrary) in any Option Agreement (i)
confers any right or obligation on any person to continue in the employ of the
Company or any Subsidiary or (ii) affects or shall affect in any way any
person's right or the right of the Company or any Subsidiary to terminate such
person's employment with the Company or any Subsidiary at any time, for any
reason, with or without cause.
ARTICLE 6
OPTION EXERCISE
6.1 Normal Option Term. Except as otherwise expressly provided in
------------------
Sections 6.3, 6.5 or 6.7 or in the Option Agreement, the right to exercise any
Option shall terminate at the earlier of the following dates: (i) the
Termination Date of the initial grantee of the Option or (ii) the Expiration
Date of the Option.
6.2 Exercise Time. No option granted to a Section 16 Holder shall become
-------------
exercisable within six months of the applicable Granting Date, except in the
case of the death or permanent disability of the Holder as provided in Section
6.5 below. Notwithstanding the terms of the Option Agreement, if any Option is
issued to a Holder who is not a Section 16 Holder on the Granting Date and such
Holder becomes a Section 16 Holder before such Holder exercises such Option,
then such Option shall not become exercisable within six months of the
applicable Granting Date, except in the case of the death or permanent
disability of the Holder as provided in Section 6.5 below. Subject to the
preceding two sentences, each Option shall become exercisable at the time
provided in the Option Agreement, provided that the Committee in its sole
discretion shall have the right (but shall not in any case be obligated) to
permit the exercise of such Option prior to such time.
6.3 Extension of Exercise Time. The Committee in its sole discretion
--------------------------
shall have the right (but shall not in any case be obligated) to permit any
Option to be exercised after the Termination Date of the Holder of such Option.
Notwithstanding the preceding sentence, but subject
-4-
<PAGE>
to Section 6.7, the Committee shall not have the right to permit the exercise of
any Option after its Expiration Date.
6.4 Exercise Procedures. Each Option shall be exercised by written notice
-------------------
to the Company. Any Holder of any Option shall be required, as a condition to
such Holder's right to purchase securities with such Option, to supply the
Committee at such person's expense with such evidence, representations,
agreements or assurances (including, but not limited to, opinions of counsel
satisfactory to the Committee) as the Committee may deem necessary or desirable
in order to establish to the satisfaction of the Committee the right of such
person to exercise such Option and of the propriety of the sale of securities by
reason of such exercise under the Securities Act and any other laws or
requirements of any governmental authority specified by the Committee. The
Company shall not be obligated to sell any Shares subject to such Option until
all evidence, representations, agreements and assurances required by the
Committee have been supplied. An Option Holder shall not have any rights as a
stockholder with respect to Shares issuable under any Option until and unless
such Shares are sold and delivered to such Option Holder. The purchase price of
Shares purchased upon the exercise of an Option shall be paid in full in cash or
by check by the Option Holder at the time of the delivery of such Shares,
provided that the Committee may (but need not) permit payment to be made by (i)
delivery to the Company of outstanding Shares, (ii) retention by the Company of
Shares which would otherwise be transferred to the Option Holder upon exercise
of the Option or (iii) any combination of cash, check, the Holder's delivery of
outstanding Shares and retention by the Company of Shares which would otherwise
be transferred to the Option Holder upon exercise of the Option, and provided
further that no portion of the purchase price of Shares purchased on the
exercise of an Incentive Stock Option may be paid by retention of Shares by the
Company. In the event an Incentive Stock Option is granted, the Committee may
(but need not) permit payment to be made by (i) cash or check or (ii) delivery
to the Company of outstanding Shares. In the event any Common Stock is
delivered to or retained by the Company to satisfy all or any part of the
purchase price, the part of the purchase price deemed to have been satisfied by
such Common Stock shall be equal to the product derived by multiplying (i) the
Per Share Market Value as of the date of exercise by (ii) the number of Shares
delivered to or retained by the Company. The number of Shares delivered to or
retained by the Company in satisfaction of the purchase price shall not be a
number which when multiplied by the Per Share Market Value as of the date of
exercise would result in a product greater than the purchase price. No
fractional Shares shall be delivered to or retained by the Company in
satisfaction of the purchase price. To the extent such fractional share would
result, the Option Holder shall make up such difference in cash. With respect
to any exercise of an Option that is permitted to be made by delivery to the
Company of outstanding Shares of Common Stock or retention by the Company of
Shares which would otherwise be transferable to the Option Holder, the Option
Holder shall be required to deposit with the Company an amount in cash
sufficient to allow the Company to satisfy any tax or other withholding
requirements under applicable law. Any part of the purchase price paid in cash
or by check upon the exercise of any Option shall be added to the general funds
of the Company and may be used for any proper corporate purpose.
Notwithstanding Article 7, unless the Board shall otherwise determine, for each
Share delivered to or retained by the Company as payment of all or part of the
purchase price upon the exercise of any Option, the aggregate number of Shares
subject to this Plan shall be increased by one Share.
6.5 Death, Permanent Disability, Retirement or Termination Without Cause
---------------------------------------------------------------------
Of Option Holder.
- ----------------
(a) Death. Except as otherwise expressly provided in the Option Agreement,
-----
if the Holder of an Option dies while such Option Holder is still employed by
the Company or any
-5-
<PAGE>
Subsidiary, then the right to exercise all unexpired installments of such Option
which have not yet vested or became exercisable shall be accelerated to the date
of death and shall become exercisable as of the date of death. Except as
otherwise provided in the option Agreement and subject to Section 6.7, if the
Holder of an option dies and such Option is then exercisable at the date of
death (for any reason including acceleration of vesting pursuant to the
preceding sentence), then the Holder's estate or the person or persons to whom
the Holder's rights under the Option shall pass by reason of the Holder's death
shall have the right to exercise the Option for 90 days after the date of death,
and the Option shall expire at the end of such 90 day period.
(b) Permanent Disability. Except as otherwise provided in the Option
--------------------
Agreement, if the Holder of an option suffers a Permanent Disability while such
Holder is still employed by the Company or any Subsidiary, then the right to
exercise all unexpired installments of such Option which have not yet vested or
became exercisable shall be accelerated to the date of such Permanent Disability
and shall become exercisable as of the date of such Permanent Disability (the
"Permanent Disability Date"). Except as otherwise provided in the Option
- --------------------------
Agreement and subject to Section 6.7, if the Holder of an Option suffers a
Permanent Disability and such Option is exercisable at the Permanent Disability
Date (for any reason including acceleration pursuant to the preceding sentence),
then such Holder shall have the right to exercise such Option for one year after
the Permanent Disability Date, and the Option shall expire at the end of such
one year period.
(c) Retirement. Except as otherwise provided in the Option Agreement, if
----------
the Holder of an Option elects to voluntarily retire from the Corporation or any
Subsidiary while such Holder is still employed by the Company or any Subsidiary,
then any installments of such Option which have not yet vested or become
---
exercisable shall remain outstanding for up to three years following the date of
such retirement. During such three year period, the time period for the vesting
of an Option contained in an Option Agreement will be deemed to continue to be
satisfied during such retirement and counted toward determining whether any time
period has been satisfied for vesting of the Option. Except as otherwise
provided in the Option Agreement and subject to Section 6.7, if the Holder of an
Option retires and such Option is or becomes exercisable at the time of or
following such retirement, then such Holder shall have the right to exercise
such option for three years after the date of retirement, and the Option shall
expire at the end of such three-year period. Notwithstanding anything in this
Section 6.5(c) or an Option Agreement to the contrary, if the Committee
determines in the good faith exercise of its judgment that any Holder who has
retired engages in any conduct detrimental to the Company, upon such
determination by the Committee, such Option shall immediately and without
further action on the part of the Company, expire and become unexerciseable. No
notice of such determination need be given to any Holder in such circumstance.
Notwithstanding the foregoing, the tax treatment available pursuant to Section
422 of the Code upon the exercise of an Incentive Stock Option will not be
available to a holder who exercises any such Option more than three months after
the date of retirement.
(d) Termination Without Cause. Except as otherwise provided in the Option
-------------------------
Agreement, if the Holder of an Option is terminated without Cause and such
Option is currently exercisable at the time of such termination, then such
Holder shall have the right to exercise such Option for 30 days after the date
of such termination, and the Option shall expire at the end of such 30 day
period.
6.6 Taxes. The Company or any Subsidiary shall be entitled, if the
-----
Committee deems it necessary or desirable, to withhold from an Option Holder's
salary or other compensation (or to secure payment from the Option Holder in
lieu of withholding) all or any portion of any
-6-
<PAGE>
withholding or other tax due from the Company or any Subsidiary with respect to
any Shares deliverable under such Holder's Option or the Committee may (but need
not) permit payment of such withholding by the Company's retention of Shares
which would otherwise be transferred to the Option Holder upon exercise of the
Option. In the event any Common Stock is retained by the Company to satisfy all
or any part of the withholding, the part of the withholding deemed to have been
satisfied by such Common Stock shall be equal to the product derived by
multiplying the Per Share Market Value as of the date of exercise by the number
of Shares retained by the Company. The number of Shares retained by the Company
in satisfaction of withholding shall not be a number which when multiplied by
the Per Share Market Value as of the date of exercise would result in a product
greater than the withholding amount. No fractional Shares shall be retained by
the Company in satisfaction of withholding. Notwithstanding Article 7, unless
the Board shall otherwise determine, for each Share retained by the Company in
satisfaction of all or any part of the withholding amount, the aggregate number
of Shares subject to this Plan shall be increased by one Share. The Company may
defer delivery under a Holder's Option until indemnified to its satisfaction
with respect to such withholding or other taxes.
6.7 Securities Law Compliance. Each Option shall be subject to the
-------------------------
condition that such Option may not be exercised if and to the extent the
Committee determines that the sale of securities upon exercise of the Option may
violate the Securities Act or any other law or requirement of any governmental
authority. The Company shall not be deemed by any reason of the granting of any
Option to have any obligation to register the Shares subject to such Option
under the Securities Act or to maintain in effect any registration of such
Shares which may be made at any time under the Securities Act. An Option shall
not be exercisable if the Committee or the Board determines there is non-public
information material to the decision of the Holder to exercise such Option which
the Company cannot for any reason communicate to such Holder. Notwithstanding
Sections 6.1, 6.3 and 6.5 and the terms of the Option Agreement, if (i) any
Holder makes a bona fide request to exercise any Option which complies with
Section 6.4, (ii) the Committee or the Board determines such Option cannot be
exercised for a period of time pursuant to this Section 6.7 and (iii) such
Option expires during such period, then the term of such Option shall be
extended until the end of such period; provided, however, that the term of an
Incentive Stock Option cannot be extended beyond ten years after its Granting
Date.
ARTICLE 7
SHARES SUBJECT TO THE PLAN
Except as provided in Sections 6.4 and 6.6 and Article 8, an aggregate of
1,109,147 Shares of Common Stock shall be subject to this Plan. Except as
provided in Sections 6.4 and 6.6 and Article 8, the Options shall be limited so
that the sum of the following shall not as of any given time exceed 1,109,147
Shares: (i) all Shares subject to Options outstanding under this Plan at the
given time and (ii) all Shares which shall have been sold by the Company by
reason of the exercise at or prior to the given time of any of the Options. The
Common Stock issued under the Plan may be either authorized and unissued shares,
shares reacquired and held in the treasury of the Corporation, or both, all as
from time to time determined by the Board. In the event any Option shall expire
or be terminated before it is fully exercised, then all Shares formerly subject
to such Option as to which such Option was not exercised shall be available for
any Option subsequently granted in accordance with the provisions of this Plan.
Notwithstanding anything contained in this Plan, the maximum
-7-
<PAGE>
aggregate number of Shares subject to Options that may be granted to any one Key
Employee in any one calendar year shall not exceed 400,000 Shares.
ARTICLE 8
ADJUSTMENTS TO REFLECT ORGANIC CHANGES
The Board shall appropriately and proportionately adjust the number and
kind of Shares subject to outstanding Options, the price for which Shares may be
purchased upon the exercise of outstanding Options, and the number and kind of
Shares available for options subsequently granted under this Plan to reflect any
stock dividend, stock split, combination or exchange of shares, merger,
consolidation or other change in the capitalization of the Company which the
Board determines to be similar, in its substantive effect upon this Plan or the
Options, to any of the changes expressly indicated in this sentence. The Board
may (but shall not be required to) make any appropriate adjustment to the number
and kind of Shares subject to outstanding Options, the price for which Shares
may be purchased upon the exercise of outstanding Options, and the number and
kind of Shares available for Options subsequently granted under this Plan to
reflect any spin-off, spin-out or other distribution of assets to stockholders
or any acquisition of the Company's stock or assets or other change which the
Board determines to be similar, in its substantive effect upon this Plan or the
Options, to any of the changes expressly indicated in this sentence. The
Committee shall have the power to determine the amount of the adjustment to be
made in each case described in the preceding two sentences, but no adjustment
approved by the Committee shall be effective until and unless it is approved by
the Board. In the event of any reorganization, reclassification, consolidation,
merger or sale of all or substantially all of the Company's assets which is
effected in such a way that holders of Common Stock are entitled to receive
(either directly or upon subsequent liquidation) stock, securities or assets
with respect to or in exchange for Common Stock, the Board may (but shall not be
required to) substitute the per share amount of such stock, securities or assets
for Shares upon any subsequent exercise of any Option. If any fractional Share
becomes subject to any Option as a result of any change made under this Article
8, then (i) such Option may not be exercised with respect to such fractional
Share until and unless such Option is exercised as to all other Shares subject
to such option and (ii) if such Option is exercised with respect to such
fractional Share, the Company shall have the right to deliver to the Holder in
lieu of such fractional Share cash in an amount equal to the product derived by
multiplying the fraction representing the portion of a full Share represented by
such fractional Share times the Per Share Market Value on the exercise date of
the Option with respect to such fractional Share established as prescribed in
this Plan.
ARTICLE 9
AMENDMENT AND TERMINATION OF THE PLAN
9.1 Amendment. Except as provided in the following two sentences, the
---------
Board shall have complete power and authority to amend this Plan at any time and
no approval by the Company's stockholders or by any other person, committee or
other entity of any kind shall be required to make any amendment approved by the
Board effective. The Board shall not, without the affirmative approval of the
Company's stockholders, amend the Plan in any manner which would cause any
outstanding Incentive Stock Options to no longer qualify as Incentive Stock
Options or which would cause the Plan not to satisfy the requirements relating
to performance based
-8-
<PAGE>
compensation under (S) 162(m) of the Code. If any Section 16 Holder holds any
Option, the Board shall not, without the affirmative vote of the holders of a
majority of the securities of the Company present, or represented, and entitled
to vote at a meeting duly held in accordance with applicable law, make any
amendment to this Plan which materially (i) increases the benefits accruing to
participants under the Plan, (ii) increases the number of shares of Common Stock
which may be issued under the Plan or (iii) modifies the requirements as to
eligibility for participation in the Plan. No termination or amendment of this
Plan may, without the consent of the Holder of any Option prior to termination
or the adoption of such amendment, materially and adversely affect the rights of
such Holder under such Option.
9.2 Termination. The Board shall have the right and the power to
-----------
terminate this Plan at any time, provided that no Incentive Stock Options may be
granted after the tenth anniversary of the adoption of this Plan. No Option
shall be granted under this Plan after the termination of this Plan, but the
termination of this Plan shall not have any other effect. Any Option
outstanding at the time of the termination of this Plan may be exercised after
termination of this Plan at any time prior to the Expiration Date of such Option
to the same extent such Option would have been exercisable had this Plan not
terminated.
ARTICLE 10
DEFINITIONS AND OTHER PROVISIONS OF THE PLAN
10.1 Definitions. Each term defined in this Section 10.1 has the meaning
-----------
indicated in this Section 10.1 whenever such term is used in this Plan:
"Board of Director" and "Board" both mean the Board of Directors of the
----------------- -----
Company as constituted at the time the term is applied.
"Cause" means (i) the willful refusal to follow directions given by the
-----
Board, (ii) commission of any act involving moral turpitude or any act which
brings or could bring the Company into disrepute or materially damages its
relations with its customers, suppliers, licensors or financing sources, (iii)
the violation of any statutory or common law duty of loyalty to the Company or
(iv) a good faith determination by a majority of the Board that continued
employment is not in the best interests of the Company.
"Common Stock" means the issued or issuable class A common stock, par value
------------
$.01 per share, of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
----
"Committee" has the meaning such term is given in Section 2.1 of this Plan.
---------
"Company" as applied as of any given time shall mean Coinmach Laundry
-------
Corporation, a Delaware corporation, except that if prior to the given time any
corporation or other entity has acquired all or a substantial part of the assets
of the Company (as herein defined) and has agreed to assume the obligations of
the Company under this Plan, or is the survivor in a merger or consolidation to
which the Company was a party, such corporation or other entity shall be deemed
to be the Company at the given time.
-9-
<PAGE>
"Expiration Date" as applied to any option means the date specified in the
---------------
Option Agreement between the Company and the Holder as the expiration date of
such Option. If no expiration date is specified in the Option Agreement
relating to any Option, then the Expiration Date of such option shall be the day
prior to the tenth anniversary of the Granting Date of such Option.
Notwithstanding the preceding sentences, if the person to whom any Incentive
Stock Option is granted owns, on the Granting Date of such Option, stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Company (or of any parent or Subsidiary of the Company
in existence on the Granting Date of such Option), and if no expiration date is
specified in the Option Agreement relating to such Option, then the Expiration
Date of such Option shall be the day prior to the fifth anniversary of the
Granting Date of such Option.
"Granting Date" has the meaning such term is given in Section 4.2 of this
-------------
Plan.
"Holder" has the meaning such term is given in Section 5.4 of this Plan.
------
"Incentive Stock Option" means an incentive stock option, as defined in
----------------------
Code Section 422, which is granted pursuant to this Plan.
"Key Employee" has the meaning such term is given in Article 3 of this
------------
Plan.
"Option" has the meaning such term is given in Section 4.1 of this Plan.
------
"Option Agreement" has the meaning such term is given in Section 4.4 of
----------------
this Plan.
"Permanent Disability" shall mean a physical or mental disability suffered
--------------------
by an initial grantee of an Option which the Committee determines in its sole
discretion will permanently prevent such initial grantee from working for the
Company in the same or a substantially similar position as such initial grantee
occupied prior to suffering such disability.
"Permanent Disability Date" has the meaning such term is given in Section
-------------------------
6.5 of this Plan.
"Per Share Market Value" on any given date shall be the fair market value
----------------------
of one Share as of the close of business on the given date determined in such
manner as shall be prescribed in good faith by the Committee; provided, that as
--------
long as the Shares are traded on a national securities exchange or national
automated quotation system (such as the Nasdaq National Market), the Per Share
Market Value shall be the reported closing price of the Shares on such date.
"Plan" has the meaning such term is given in Section 1.1 of this Plan.
----
"Section 16 Holder" refers to any person who, with respect to the Company,
-----------------
is subject to Section 16 of the Securities Exchange Act of 1934, as amended, at
any time or any law or statute which succeeds Section 16.
"Securities Act" at any given time shall consist of: (i) the Securities Act
--------------
of 1933 as constituted at the given time; (ii) any other law or laws promulgated
prior to the given time by the United States Government which are in effect at
the given time and which regulate or govern any matters at any time regulated or
governed by the Securities Act of 1933; (iii) all regulations, rules,
registration forms and other governmental pronouncements issued under the laws
specified in clauses
-10-
<PAGE>
(i) and (ii) of this sentence which are in effect at the given time; and (iv)
all interpretations by any governmental agency or authority of the things
specified in clause (i), (ii) or (iii) of this sentence which are in effect at
the given time. Whenever any provision of this Plan requires that any action be
taken in compliance with any provision of the Securities Act, such provision
shall be deemed to require compliance with the Securities Act as constituted at
the time such action takes place.
"Share" means a share of Common Stock.
-----
"Subsidiary" means any corporation in which the Company owns, directly or
----------
indirectly, 50% or more of the total combined voting power of all classes of
securities of such corporation.
"Termination Date" as applied to the initial grantee of any Option means,
----------------
except as otherwise provided in the Option Agreement, the first date on which
such initial grantee is not employed by either the Company or any Subsidiary for
any reason (including, but not limited to, voluntary termination or termination
for Cause) other than as a result of the death, Permanent Disability, retirement
or termination without Cause of such Holder, in which case the provisions set
forth in Section 6 shall apply. The Committee may specify in the original terms
of an Option (or if not so specified, shall determine) whether an authorized
leave of absence or absence on military or government service or absence for any
other reason shall constitute a termination of employment with the Company or
any Subsidiary for the purposes of this Plan.
10.2 Headings. Section headings used in this Plan are for convenience
--------
only, do not constitute a part of this Plan and shall not be deemed to limit,
characterize or affect in any way any provisions of this Plan. All provisions
in this Plan shall be construed as if no headings had been used in this Plan.
10.3 Severability.
------------
(a) General. Whenever possible, each provision in this Plan and in every
-------
Option at any time granted under this Plan shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Plan or any Option at any time granted under this Plan is held to be prohibited
by or invalid under applicable law, then (i) such provision shall be deemed
amended to accomplish the objectives of the provision as originally written to
the fullest extent permitted by law and (ii) all other provisions of this Plan
and every option at any time granted under this Plan shall remain in full force
and effect.
(b) Incentive Stock Options. Whenever possible, each provision in this
-----------------------
Plan and in every option at any time granted under this Plan which is evidenced
by an Option Agreement which expressly states such Option is intended to
constitute an Incentive Stock Option under Code Section 422 (an "intended ISO")
------------
shall be interpreted in such manner as to entitle such intended ISO to the tax
treatment afforded by the Code to Options which do constitute Incentive Stock
Options under Code Section 422, but if any provision of this Plan or any
intended ISO at any time granted under this Plan is held to be contrary to the
requirements necessary to entitle such intended ISO to the tax treatment
afforded by the Code to Options which do constitute Incentive Stock Options
under Code Section 422, then (i) such provision shall be deemed to have
contained from the outset such language as shall be necessary to entitle such
intended ISO to the tax treatment afforded by the Code to Options which do
constitute Incentive Stock Options under Code Section 422, and (ii) all other
provisions of this Plan and such intended ISO shall remain in full force and
effect. If any Option Agreement
-11-
<PAGE>
covering an intended ISO granted under this Plan does not explicitly include any
terms required to entitle such intended ISO to the tax treatment afforded by the
Code to Options which do constitute Incentive Stock Options under Code Section
422, then all such terms shall be deemed implicit in the intention to afford
such treatment to such Option and such Option shall be deemed to have been
granted subject to all such terms.
10.4 No Strict Construction. No rule of strict construction shall be
----------------------
applied against the Company, the Committee or any other person in the
interpretation of any of the terms of this Plan, any Option or any rule or
procedure established by the Committee.
10.5 Choice of Law. This Plan and all documents contemplated hereby, and
-------------
all remedies in connection therewith and all questions or transactions relating
thereto, shall be construed in accordance with and governed by the internal laws
of the State of Delaware.
-12-
<PAGE>
EXHIBIT 53
OMNIBUS AMENDMENT TO OPTION AGREEMENTS
--------------------------------------
This Agreement (the "Omnibus Amendment to Option Agreements"), dated
as of September 17, 1996, is made by and among Coinmach Laundry Corporation, a
Delaware corporation, with offices at 55 Lumber Road, Roslyn, New York 11576
(together with any and all present and future affiliates and subsidiaries
thereof, the "Corporation"), and each of MCS Capital, Inc. ("MCS"), Ronald S.
Brody ("Brody"), James N. Chapman ("Chapman"), Robert M. Doyle ("Doyle"),
Michael E. Stanky ("Stanky"), David A. Siegel ("Siegel"), R. Daniel Osborne
("Osborne"), John E. Denson ("Denson"), James McDonnell ("McDonnell"), Russell
Harrison ("Harrison"), Charles Prato ("Prato") and Michael E. Marrus ("Marrus"
and together with MCS, Brody, Chapman, Doyle, Stanky, Siegel, Osborne, Denson,
McDonnell, Harrison and Prato, the "Optionees").
WHEREAS, the Corporation and each Optionee entered into an Option
Agreement, dated July 23, 1996, pursuant to which the Corporation granted to
each such Optionee certain options to purchase its Class A common stock, par
value $.01 per share (the "Common Stock"), subject to the terms and conditions
set forth in such Option Agreement (collectively, the "Option Agreements");
WHEREAS, in connection with the initial public offering of the
Corporation's Common Stock (the "Offering"), on August 16, 1996, the
underwriters in the Offering exercised their over-allotment option to purchase
additional shares of Common Stock thereby increasing the aggregate number of
issued and outstanding shares of Common Stock;
WHEREAS, subject to the terms and conditions hereof, the Corporation
and each Optionee desire to amend the Option Agreements to increase the number
of options granted thereunder so as to preserve, on a pro-rata basis, the
percentage interest of issued and outstanding Common Stock on a fully diluted
basis represented by the stock options granted pursuant to the Option
Agreements;
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, and intending to be legally bound
hereby, the parties hereto agree to amend the Option Agreements as follows:
1. Defined Terms. All capitalized terms contained in this Omnibus
-------------
Amendment to Option Agreements not otherwise defined herein shall have the
meanings ascribed to such terms in the Option Agreements.
2. Grant of Options. Section 1 of each Option Agreement is hereby
----------------
amended by replacing the number of shares of Common Stock granted to each
Optionee set forth in Section 1 of the Option Agreements with the number of
shares of Common Stock appearing beside each such Optionee's name set forth on
Schedule A attached hereto.
3. Terms of Options. The first sentence of Section 4 of each Option
----------------
Agreement is hereby amended by replacing the number of shares of Common Stock
each Optionee is entitled to purchase upon exercise of Options with the number
of shares of Common Stock appearing beside each such Optionee's name set forth
on Schedule A attached hereto. Additionally, the vesting schedule set forth in
Section 4 of each Option Agreement is hereby amended by replacing the number of
shares of Common Stock set forth below the column captioned "Number of Options
Vesting on the Vesting Date" with the number of shares of Common Stock appearing
beside each such Optionee's
<PAGE>
Omnibus Amendment to Option Agreements
Page 2
name and set forth below the column captioned "Number of Options Vesting on the
Vesting Date" set forth on Schedule A attached hereto.
4. Reaffirmation of Representations and Warranties. Each Optionee
-----------------------------------------------
hereby reaffirms to the Corporation, but only with respect to such Optionee,
that each of the representations and warranties made by such Optionee in Section
13 of the Option Agreements are true and correct as of the date hereof.
5. Notices. Section 16 of each Option Agreement is hereby amended
-------
in its entirety as follows:
"Notices. Any notice or other communication to be given by any party
-------
hereunder to any other party shall be in writing, delivered personally,
mailed by certified or registered mail, return receipt requested, or sent
by a nationally recognized courier service, and shall be addressed to such
party at its address stated on its signature page to the Omnibus Amendment
to Option Agreements, dated September __, 1996, by and among the
Corporation, Optionee and certain other parties or to such other address as
may have been furnished by any party to the other pursuant to this Section
16, and shall be deemed to be given on the date of receipt."
6. Voting Agreement. Upon exercise of the Options by each Optionee
----------------
pursuant to the terms hereof and the Option Agreements, each Optionee shall
become party to the Voting Agreement, dated July 23, 1996 (the "Voting
------
Agreement"), by and among the Corporation and the signatories thereto, by
- ---------
executing a written agreement, substantially in the form of the Voting
Agreement, pursuant to which such Optionee agrees to be bound by all of the
provisions thereof.
7. Entire Agreement. Except as herein specifically amended, all
----------------
other terms, covenants and provisions of each of the Option Agreements shall
remain in full force and effect and shall be performed by the parties thereto in
accordance therewith.
[SIGNATURE PAGES FOLLOW]
<PAGE>
Omnibus Amendment to Option Agreements
Page 3
IN WITNESS WHEREOF, the undersigned have executed and delivered this
Omnibus Amendment to Option Agreements as of the date first above stated.
COINMACH LAUNDRY CORPORATION
/s/ Robert M. Doyle
By: ______________________________
Robert M. Doyle
Senior Vice President
Address: 55 Lumber Road
Roslyn, New York 11576
<PAGE>
Omnibus Amendment to Option Agreements
Page 4
MCS CAPITAL, INC.
/s/ Stephen R. Kerrigan
By: ______________________________
Stephen R. Kerrigan
President
Address: 55 Lumber Road
Roslyn, New York 11576
<PAGE>
Omnibus Amendment to Option Agreements
Page 5
/s/ Ronald S. Brody
____________________________________
Ronald S. Brody
Address: 429 East 52nd Street
Apartment 14A
New York, New York 10022
<PAGE>
Omnibus Amendment to Option Agreements
Page 6
/s/ James N. Chapman
____________________________________
James N. Chapman
Address: 14 Alpine Road
Greenwich, Connecticut 06830
<PAGE>
Omnibus Amendment to Option Agreements
Page 7
/s/ Robert M. Doyle
____________________________________
Robert M. Doyle
Address: 55 Lumber Road
Roslyn, New York 11576
<PAGE>
Omnibus Amendment to Option Agreements
Page 8
/s/ Michael E. Stanky
____________________________________
Michael E. Stanky
Address: 4430 Bronze Way
Dallas, Texas 75236
<PAGE>
Omnibus Amendment to Option Agreements
Page 9
/s/ David A. Siegel
____________________________________
David A. Siegel
Address: 10818 St. Mary's
Houston, Texas 77079
<PAGE>
Omnibus Amendment to Option Agreements
Page 10
/s/ R. Daniel Osborne
____________________________________
R. Daniel Osborne
Address: 910 Westham Parkway
Richmond, Virginia 23229
<PAGE>
Omnibus Amendment to Option Agreements
Page 11
/s/ John E. Denson
____________________________________
John E. Denson
Address: 111 Cove Lane
Media, Pennsylvania 19063
<PAGE>
Omnibus Amendment to Option Agreements
Page 12
/s/ James McDonnell
____________________________________
James McDonnell
Address: 341 Carriage House Lane
Haddonfield, New Jersey 08033
<PAGE>
Omnibus Amendment to Option Agreements
Page 13
/s/ Russell Harrison
____________________________________
Russell Harrison
Address: 55 Lumber Road
Roslyn, New York 11576
<PAGE>
Omnibus Amendment to Option Agreements
Page 14
/s/ Charles Prato
____________________________________
Charles Prato
Address: 55 Lumber Road
Roslyn, New York 11576
<PAGE>
Omnibus Amendment to Option Agreements
Page 15
/s/ Michael E. Marrus
____________________________________
Michael E. Marrus
Address: 755 Park Avenue
New York, New York 10021
<PAGE>
SCHEDULE A TO OMNIBUS AMENDMENT TO OPTION AGREEMENTS
<TABLE>
<CAPTION>
===================================================================
NUMBER OF OPTIONS VESTING
GRANT OF OPTIONS ON THE VESTING DATE/*/
===================================================================
<S> <C> <C>
MCS 308,098| 61,622; 61,619; 61,619; 61,619; 61,619
- ---------------------------|---------------------------------------
Brody 57,512| 11,504; 11,502; 11,502; 11,502; 11,502
- ---------------------------|---------------------------------------
Chapman 28,756| 5,752; 5,751; 5,751; 5,751; 5,751
- ---------------------------|---------------------------------------
Doyle 71,890| 14,378; 14,378; 14,378; 14,378; 14,378
- ---------------------------|---------------------------------------
Stanky 103,521| 20,705; 20,704; 20,704; 20,704; 20,704
- ---------------------------|---------------------------------------
Siegel 28,756| 5,752; 5,751; 5,751; 5,751; 5,751
- ---------------------------|---------------------------------------
Osborne 28,756| 5,752; 5,751; 5,751; 5,751; 5,751
- ---------------------------|---------------------------------------
Denson 28,756| 5,752; 5,751; 5,751; 5,751; 5,751
- ---------------------------|---------------------------------------
McDonnell 28,756| 5,752; 5,751; 5,751; 5,751; 5,751
- ---------------------------|---------------------------------------
Harrison 14,378| 2,878; 2,875; 2,875; 2,875; 2,875
- ---------------------------|---------------------------------------
Prato 11,502| 2,302; 2,300; 2,300; 2,300; 2,300
- ---------------------------|---------------------------------------
Marrus 28,756| 5,752; 5,751; 5,751; 5,751; 5,751
===========================|=======================================
</TABLE>
_________
/*/ Represents the number of shares of Common Stock vesting on each of July 23,
1996, July 23, 1997, July 23, 1998, July 23, 1999 and July 23, 2000,
respectively.
