COINMACH SERVICES CORPORATION PROPOSAL FOR LAUNDRY SERVICES

COINMACH SERVICES CORPORATION PROPOSAL FOR LAUNDRY SERVICES

OVERVIEW

Coinmach Services Corporation is please to submit this proposal in support of Property Management's goal of improving tenant satisfaction levels with your laundry center at Key West apartments. We understand that to meet your tenant's needs, the laundry center must not only be problem free, it must exceed their expectations. To achieve this, the laundry center at Key West apartments needs to provide tenants with a state of art experience that makes the routine of completing their laundry enjoyable. The good news is that Coinmach is uniquely qualified with the resources to make that happen.

The Objective

Need #1: Provide a state of the art laundry experience to your tenants while providing sufficient commission checks to cover the cost associated with operating the laundry center. Need #2: Install state of the art laundry equipment that: receives quarters with minimal jamming of coin slots; provides accurate meter readings that cannot be changed; ensures the security of the coin boxes by installing metal guards. Need #3: Improve the overall management of the laundry center by responding to service issues within 24 hours, ensuring the accuracy of coin collections and by handling refunds in an expedient manner.

The Opportunity

We have an opportunity to meet all your needs while improving the laundry experience of your tenants.

Laundry center system technology has improved in ways that make the routine of doing laundry efficient and enjoyable.

Proposal 3a

? Frontload LG washing machines are more energy efficient and require less water than any other washing machine on the market. This allows us to keep our recommended vend rates low while still providing enough revenue for our property owners to cover the cost of utilities, laundry center maintenance and Coinmach's laundry services.

? Imagine your tenants accessing information on their computer or smart phone that lets them know when machines are available. Consider that technology today can also provide information on the status of their loads including alerts that let them know for example, that their dryer load will be completed in 10 minutes.

? It is also true that laundry rooms today do not require quarters because payments can be made utilizing a credit card or smart phone app. This same app, through the use of a QR Code, can be utilized to submit service request directly to a certified technician that will respond within 24 hours.

When you combine the benefits of energy efficient LG laundry machines that are water and energy efficient, with a Heartland card system and Wave Rider smart apps, you will have a state of art laundry room that will exceed your tenant's expectations.

The Solution

Recommendation #1: Install 10 LG Front--Loader washing machines and 10 LG gas dryers. This combination will minimize the cost of utilities per load allowing you to keep your vend prices at reasonable levels.

Recommendation #2: Utilize Heartland card system technology to make it easier for your tenants to pay for their use of your laundry room.

We can install machines that accept coin and card payments, however we recommend making your laundry room cash free to eliminate the need for quarters and security guard equipment.

Recommendation #3: Trust your laundry center service needs to Coinmach certified technicians that will ensure your laundry room is properly serviced and maintained.

Their expertise and ease of access through our call center, web site and smart phone app ensure service issues are quickly addressed.

OUR PROPOSAL

Coinmach has been providing laundry services to property managers and their residents for over 65 years. During this time Coinmach has been fortunate to grow and become the leading national laundry equipment services provider. We could not have become the company we are today without the support of our customers, many of whom are families that have partnered with Coinmach for multiple generations. Through these relationships and over the years, Coinmach has learned and developed the expertise to provide the nation's leading laundry equipment service solutions.

Proposal 3a

Our Qualifications

The knowledge and resources we have acquired over the years enable us to help our property owners provide the best laundry center solutions for their tenants. Our expertise helps property owners provide laundry services that are better than those they would be able to offer on their own. Consider that we purchase thousands of machines every year enabling us to get the very best pricing on laundry equipment. We have developed a system to manage laundry centers over the years that ensures every machine is right for the location, every installation is done right the first time, every technician is certified and every collector is reliable and trustworthy with a security team to ensure they and your money is safe.

Owner Operator Option

One option you are considering is purchasing your own equipment and setting up an owner--operated laundry center. There are some key things you should consider as you decide whether or not you want to get into the laundry business.

Equipment: Which machines should we purchase? There are always questions about which machines are best.

Collections & Bank Deposits: Who will collect the quarters and get them to the bank? There are security issues to consider and banks usually charge a fee for large coin deposits.

Maintenance & Repairs: Who will maintain and repair the machines? Warranties may cover parts but generally do not cover labor, coin boxes or card slides. Vandalized or out of balance machines will require service as well.

Resident Requests: Who will handle refund requests, damaged clothing claims, service requests and change requests? How these issues are handled can affect resident satisfaction levels and can happen at any time.

Other Considerations: Who will handle vend increases, pay laundry room damage costs due to improperly used and/or leaking machines?

If you decide to become an owner operator, Coinmach can help. We have the commercial equipment available at great prices including washing machines, dryers and card systems. We have knowledgeable staff that can help you select the right equipment for your laundry center. We also have service and collection services available for an affordable flat monthly fee.

Partnership with Coinmach

Proposal 3a

A better alternative and the one we are proposing, is to partner with Coinmach. Coinmach will lease the laundry room space from you for a period of 10 years in exchange for 45% of the revenue generated by the machines.

Our proposed lease agreement will also include the following:

1. Coinmach will pay for and install 10 new high efficiency LG front--load washing machines and 10 new LG dryers.

2. Coinmach will also pay for and install a Heartland card system. 3. Coinmach will also pay for and install security guard equipment, if necessary. 4. Coinmach will provide all of the related laundry services (installation, collections &

repair/maintenance) for your Key West laundry center at no cost.

a. Coinmach will install the laundry room equipment on an agreed upon date within 30--45 days of a signed agreement. b. Coinmach will schedule sufficient collections, make deposits and change vends. Vends will initially be set at $1.50 for a wash and $1.50 for a 45 minute dry. Vend rates will be adjusted annually to reflect changes in the Consumer Price Index. c. Coinmach will monitor collections and ensure that any theft or vandalism issues are identified and addressed through monthly security checks.

d. Coinmach will maintain and service the machines through our team of certified technicians with repairs completed within 24 hours.

e. Coinmach will clean vents and update signs in the laundry center as needed.

5. Coinmach will return 55% of all monies collected each month to Property Management via a check or through electronic deposits.

6. Coinmach will carry $12,000,000 of liability insurance on the laundry center at Key West. 7. Coinmach will provide web tools and smart phone apps that enable residents to monitor

machine availability and their laundry loads. 8. Coinmach will handle resident requests for refunds, service and payment for damaged clothing.

When you consider what Coinmach is offering and our long--standing reputation as a leading service provider in the industry; we think you will agree that partnering with Coinmach as your laundry service provider is the better choice.

Timeline

Once we have your approval to move forward based on this proposal, we will write up the lease and provide it to you for your review and signature. Once we have received a signed copy of the lease, we will order the new equipment for your laundry center.

? The LG machines are shipped to us from South Korea and will arrive at our warehouse within 3 weeks from the date ordered.

? The Heartland card reader equipment is shipped to us from Tennessee and will arrive at our warehouse within 2 weeks from the date ordered.

Proposal 3a

Once the equipment arrives at our warehouse, we will contact you to set up an install date. Depending upon your schedule, installation should be completed within 30 ? 45 days from the date of signing.

KEY CONSIDERATIONS

LG ENERGY EFFICIENT MACHINES

As an exclusive provider of LG washers, Coinmach is leading the way towards the future of green laundry. LG frontload washers have the best water and energy consumption ratings. LG frontload washing machines utilize 64% less water than commercial top load washers (12.9 gallons versus 36.7 gallons), which reduces water costs. They spin clothes faster at over 1,000 RPMs for maximum water extraction, reducing water content in clothes and drying time, which lowers your utility costs.

These best in class machines utilize the first belt free direct drive technology, which makes them whisper quiet and more dependable. They have the industry's largest tub capacity at 4.06 cubic feet and largest door opening at 15.7 inches so there isn't any need for your residents to go to the Laundromat for blankets and rugs. In addition to being designed to be the best commercial laundry equipment, LG washers and dryers are also attractive with a high--end stylish design that will appeal to your residents.

UTILITY COST CALCULATOR

One of your requirements is that the revenue sharing check provides you with the money you need to cover the cost of the laundry center utilities, keeping the laundry center clean and still make a profit.

Utilizing the Laundry Cost Calculator from the Mr. Electric web site, we estimate that the utility cost per load, for one wash and one dry combined, will be approximately 50 cents. We have set the vend rates at $1.50 for a wash and $1.50 for a dry or $3.00 per load. Your share of this revenue will be 55% or per load, approximately $1.65.

After utilities and janitorial services, you should expect to clear $1.00 per load. With 108 apartments completing an average of 8 loads every other week, your profit on the laundry center is expected to be $1,728 per month (108 X 16 X $1).

Laundry Costs Calculator (excluding Soap)

Washer Type % Hot/Warm/Cold?

"Cold" wash temp?

Incoming water temperature Water Heater type Dryer Type Cost of electricity (per kWh) Cost of gas ($/therm) Cost of water ($/1000 gallons)

Top--Loader

33% each (not heated) 57oF (14oC)

Gas

Electric

25? $1.264

$4.68

Front--Loader

33% each (not heated) 57oF (14oC)

Gas

Electric

25? $1.264

$4.68

Top--Loader

33% each (not heated) 57oF (14oC)

Gas

Gas

25? $1.264

$4.68

Front--Loader

33% each (not heated) 57oF (14oC)

Gas

Gas

25? $1.264

$4.68

Proposal 3a

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