UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

FORM 10-K

For the fiscal year ended March 31, 2004

OR

For the transition period from                     to

Commission File Number 0-7694

Coinmach Corporation

Registrant’s telephone number, including area code: (516) 349-8555

Securities registered pursuant to Section 12 (b) of the Act: None

Securities registered pursuant to Section 12 (g) of the Act: None

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding twelve months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ü] No [  ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [  ]

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes [  ] No [ü]

     As of June 29, 2004, the registrant had outstanding 100 shares of common stock, par value $.01 per share.

     No market value can be determined for our common stock. See Item 5 of this Form 10-K Report.

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Table of Contents

PART I

ITEM 1. BUSINESS

     Unless otherwise stated or the context otherwise requires, references throughout this annual report to “Coinmach Corp.”, “we”, “our” and “us” refer to Coinmach Corporation, a Delaware corporation and the registrant, and its direct and indirect subsidiaries, including Appliance Warehouse of America, Inc., a Delaware corporation (“AWA”), and Super Laundry Equipment Corp., a Delaware corporation (“Super Laundry”). Unless otherwise expressly indicated herein, the descriptions of Coinmach Corp. contained herein are as of March 31, 2004.

Description of the Business

General

     We believe we are the leading provider of outsourced laundry equipment services for multi-family housing properties in North America. Our core business (which we refer to as the “route” business) involves leasing laundry rooms from building owners and property management companies, installing and servicing laundry equipment, collecting revenues generated from laundry machines and operating retail laundromats. For the fiscal year ended March 31, 2004, our route business represented approximately 88% of our total revenue.

     Our long-term contracts with our customers provide us with stable, recurring revenues and consistent cash flows. We estimate that approximately 89% of our locations are subject to long-term contracts with initial terms of five to ten years, most of which have automatic renewal or right of first refusal provisions. In each year since 1997, we have retained on average approximately 97% of our existing machine base.

     The existing customer base for our route business is comprised of owners of rental apartment buildings, property management companies, condominiums and cooperatives, universities and other multi-family housing properties. We typically set pricing for the use of laundry machines on location, and the owner or property manager maintains the premises and provides utilities such as natural gas, electricity and water. Our size and scale offer significant advantages over our competitors in terms of operating efficiencies and the quality of service we provide our customers.

     In addition to our route business, we rent laundry machines and other household appliances to property owners, managers of multi-family housing properties, individuals and corporate entities through AWA. AWA is a subsidiary jointly-owned by Coinmach Corp. and Coinmach Holdings, LLC, a Delaware limited liability company and Coinmach Corp.’s ultimate parent (“Holdings”). As of March 31, 2004, approximately 198,000 washers and dryers were installed with our rental customers through AWA. We also operate a laundry equipment distribution business through Super Laundry, a wholly-owned subsidiary of Coinmach Corp.

     Coinmach Corp. is a wholly-owned subsidiary of Coinmach Laundry Corporation, a Delaware corporation (“Laundry Corp.”), which in turn is a wholly-owned subsidiary of Holdings.

     We maintain our headquarters in Plainview, New York, a corporate office in Charlotte, North Carolina and regional offices throughout the United States through which we conduct operating activities, including sales, service and collections.

     Our Strategy

     Our business strategy is to maintain and enhance our market leadership position as the leading supplier of outsourced laundry equipment services for multi-family housing properties in North America. Our growth strategy is to increase cash flow from operations and profitability through a combination of organic and external growth,

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through which we expect to achieve additional economies of scale. We also intend to enter segments of our industry that complement our stable route business.

     Organic Growth. The principal factors contributing to our organic growth include:

	•		New Customers and Locations. Our sales and marketing efforts focus on adding new customers as well as increasing the number of locations from our existing customers. We add new customers by marketing our products and services to building managers and property owners whose leases with other laundry equipment services providers are near expiration or who currently manage their own laundry facilities. According to information provided by the Multi-housing Laundry Association, there are approximately 1.1 million machines installed in locations that continue to be managed by owner-operators. Building owners or managers can eliminate cash outlays and equipment servicing costs by contracting with us to purchase, service and maintain laundry equipment. We offer a full range of services from the design, construction and installation of new laundry equipment facilities to the refurbishment of existing facilities which we believe provides us a competitive advantage in securing new customers.
	•		Operating Efficiencies. We focus on improving our net contribution per machine by increasing operating efficiencies. Each additional location added to our existing base provides us the ability to further leverage our well-developed operating infrastructure and positions us to achieve higher returns on our established base.
	•		Price Changes. We actively monitor our installed base to identify those locations in which to implement price changes. Pricing strategy is established at the corporate level, and implemented by the regional managers, at their discretion, as local competition and other factors unique to a local region are analyzed in determining the efficacy of price changes. Since our regional managers’ compensation is linked to the financial performance of their region, they are provided certain latitude to implement pricing changes and other operational policies to maximize the revenues and operating cash flow of their local business.
	•		Disciplined Approach to Capital Expenditures. Whether a new contract or an acquisition, we are focused on the ability to generate the revenues and operating cash flow to validate any capital investment decision. As such, every new contract, renewal and/or acquisition undergoes a comprehensive financial analysis to ensure that our return criteria are met.
	•		Continued Development of Integrated Computer Systems. While we believe that we have the most advanced management information systems in the industry, we are constantly working with our vendors to upgrade our integrated computer systems, given the rapid changes in technology. To that end, we initiated a comprehensive program through which we will improve communications among our regions and maximize cost savings, including programs related to field service management sales force automation, and business intelligence. We invested approximately $2.7 million in this program in the year ended March 31, 2004, with an additional $3.0 million budgeted for the subsequent fiscal year. We believe that the results of this investment program will result in improved financial performance through increased operational efficiency, quicker response time and reduced costs.
	•		Expansion of Rental Opportunities. We believe that AWA is well-positioned for growth in both new and existing markets. As a result, we are continuing our investment efforts in AWA in laundry equipment, computer systems, and regional offices to improve customer service and reduce operating costs.

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     External Growth. The principal factors contributing to our external growth include:

	•		Growth Through Disciplined Acquisitions. While the number of significant acquisition opportunities has diminished, due in part to our successful execution of our acquisition strategy, we have focused our efforts over the past several years on selectively acquiring smaller routes within our fragmented industry. We believe that there are numerous private, family-owned businesses that often lack the financial resources to compete effectively with larger independent operators such as us to secure new or existing contracts. Consequently, such independent operators, especially those that are undergoing generational ownership changes, continue to represent potential acquisition opportunities. Determination of attractive acquisition targets is based on many factors, including the size of the business in terms of cash flow and ongoing machine base, existing contract terms and potential operating efficiencies and cost savings.
	•		Develop Complementary Lines of Business. We believe that our leading market position and our access to over six million individual housing units provide us with additional growth and diversification opportunities both within and beyond our existing laundry business. We believe that our existing sales, service, collections and security infrastructure could potentially be extended into other collections or service-based route businesses that are unrelated to our existing laundry business. We regularly explore strategic alliances with other companies in an effort to develop these ancillary revenue streams, such as payphone and parking meter collection services.

Our Industry

     The laundry equipment services industry is characterized by stable operating cash flows generated by long-term, renewable lease contracts with multi-family housing property owners and management companies. Based upon industry estimates, we believe there are approximately 3.5 million installed machines in multi-family properties throughout the United States, approximately 2.4 million of which have been outsourced to independent operators such as us and approximately 1.1 million of which continue to be operated by the owners of such locations, which we refer to as owner operators.

     We believe the industry’s consistent revenue and operating cash flows are primarily due to the long-term nature of location leases and the stable demand for laundry services. When new or renewal leases are signed, industry participants incur initial costs including the cost of washers and dryers, laundry room leasehold improvements and, at times, advance location payments. Property owners and landlords are typically responsible for utilities. Moreover, as the useful life of laundry equipment typically extends throughout the term of the contract pursuant to which it is installed, incremental capital requirements including working capital to service such contracts are not significant. Hence, the industry’s operating cash flows and capital requirements are predictable.

     Historically, the industry has been characterized by stable demand and has generally been resistant to changing market conditions and economic cycles. While the industry is affected by changes in occupancy rates of residential units, the effect of such changes is limited as laundry services are a necessity for tenants.

     The laundry equipment services industry remains highly fragmented, with many small, private and family-owned route businesses operating throughout all major metropolitan areas in the United States. According to information provided by the Multi-housing Laundry Association, the industry consists of over 280 independent operators. We believe that the highly fragmented nature of the industry, combined with the competitive advantages associated with economies of scale, will lead to further consolidation within the industry.

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Business Operations

     Description of Principal Operations

     The primary aspects of our route business operations include: (i) sales and marketing; (ii) location leasing; (iii) service; (iv) information management; (v) remanufacturing and (vi) revenue collection and security.

     Sales and Marketing

     We market our products and services through a sales staff with an average industry experience of over ten years. The principal responsibility of the sales staff is to solicit customers and negotiate lease arrangements with building owners and managers. Sales personnel are paid commissions that comprise 50% or more of their annual compensation. Selling commissions are based on a percentage of a location’s annualized earnings before interest and taxes. Sales personnel must be proficient with the application of sophisticated financial analyses, which calculate minimum returns on investments to achieve our targeted goals in securing location contracts and renewals. We believe that our sales staff is among the most competent and effective in the industry.

     Our marketing strategy emphasizes excellent service offered by our experienced, highly-skilled personnel and quality equipment that maximizes efficiency and revenue and minimizes machine down-time. Our sales staff targets potential new and renewal lease locations by utilizing the integrated computer systems’ extensive database to provide information on our, as well as our competitors’, locations. Additionally, the integrated computer systems monitor performance, repairs and maintenance, as well as the profitability of locations on a daily basis. All sales, service and installation data is recorded and monitored daily on a custom-designed, computerized sales planner.

     No single customer represents more than 2% of our gross revenue, and our ten largest customers collectively account for less than 5% of our gross revenue.

     Location Leasing

     Our leases provide us the exclusive right to operate and service the installed laundry machines, including repairs, revenue collection and maintenance. We typically set pricing for the use of the machines on location, and the property owner or property manager maintains the premises and provides utilities such as gas, electricity and water.

     In return for the exclusive right to provide laundry equipment services, most of our leases provide for monthly commission payments to the location owners. Under the majority of leases, these commissions are based on a percentage of the cash collected from the laundry machines. Many of our leases require us to make advance location payments to the location owner in addition to commissions. Our leases typically include provisions that allow for unrestricted price increases, a right of first refusal (an opportunity to match competitive bids at the expiration of the lease term) and termination rights if we do not receive minimum net revenues from a lease. We have some flexibility in negotiating our leases and, subject to local and regional competitive factors, may vary the terms and conditions of a lease, including commission rates and advance location payments. We evaluate each lease opportunity through our integrated computer systems to achieve a desired level of return on investments.

     We estimate that approximately 89% of our locations are under long-term leases with initial terms of five to ten years. Of the remaining locations not subject to long-term leases, we believe that we have retained a majority of such customers through long-standing relationships and expect to continue to service such customers. Most of our leases renew automatically or have a right of first refusal provision. Our automatic renewal clause typically provides that, if the building owner fails to take any action prior to the end of the original lease term or any renewal term, the lease will automatically renew on substantially similar terms. As of March 31, 2004, based on number of machines, our leases had an average remaining life to maturity of approximately 52 months (without giving effect to automatic renewals).

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     Service

     Our employees deliver, install, service and collect revenue from washers and dryers in laundry facilities at our leased locations.

     Our integrated computer systems allow for the quick dispatch of service technicians in response to both computer-generated (for preventive maintenance) and customer-generated service calls. On a daily basis, we receive and respond to approximately 2,500 service calls. We estimate that less than 1% of our machines are out of service on any given day. The ability to reduce machine down-time, especially during peak usage, enhances revenue and improves our reputation with our customers.

     In a business that emphasizes prompt and efficient service, we believe that our integrated computer systems provide a significant competitive advantage in terms of responding promptly to customer needs. Computer-generated service calls for preventive maintenance are based on previous service history, repeat service call analysis and monitoring of service areas. These systems coordinate our radio-equipped service vehicles and allow us to address customer needs quickly and efficiently.

     Information Management

     Our integrated computer systems serve three major functions: (i) tracking the service cycle of equipment; (ii) monitoring revenues and costs by location, customer and salesperson; and (iii) providing information on competitors’ and our lease renewal schedules.

     Our integrated computer systems provide speed and accuracy throughout the entire service cycle by integrating the functions of service call entry, dispatching service personnel, parts and equipment purchasing, installation, distribution and collection. In addition to coordinating all aspects of the service cycle, our integrated computer systems track contract performance, which indicate potential machine problems or pilferage and provide data to forecast future equipment servicing requirements. Given the rapid changes in technology, we are constantly working with vendors to upgrade our integrated computer systems to enhance the productivity of our workforce. To that end, we initiated a comprehensive program in September 2003 through which we will improve communications among our regions and maximize cost savings, including programs related to business intelligence, field service management and sales force automation.

     Data on machine performance is used by our sales staff to forecast revenue by location. We are able to obtain daily, monthly, quarterly and annual reports on location performance, coin collection, service and sales activity by salesperson.

     Our integrated computer systems also provide our sales staff with an extensive database essential to our marketing strategy to obtain new business through competitive bidding or owner-operator conversion opportunities.

     We also believe that our integrated computer systems enhance our ability to successfully integrate acquired businesses into our existing operations. Regional or certain multi-regional acquisitions have typically been substantially integrated within 90 to 120 days, while a local acquisition can be integrated almost immediately.

     Remanufacturing

     We rebuild and reinstall a portion of our machines at approximately one-third the cost of acquiring new machines, providing cost savings. Remanufactured machines are restored to virtually new condition with the same estimated average life and service requirements as new machines. Machines that can no longer be remanufactured are added to our inventory of spare parts.

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     Revenue Collection and Security

     We believe that we provide the highest level of security for revenue collection control in the laundry equipment services industry. We utilize numerous precautionary procedures with respect to cash collection, including frequent alteration of collection patterns and extensive monitoring of collections and personnel. We enforce stringent employee standards and screening procedures for prospective employees. Employees responsible for, or who have access to, the collection of funds are tested randomly and frequently. Additionally, our security department performs trend and variance analyses of daily collections by location. Security personnel monitor locations, conduct investigations, and implement additional security procedures as necessary.

Description of Complementary Operations

     Rental Operations

     AWA is involved in the business of leasing laundry equipment and other household appliances and electronic items to corporate relocation entities, property owners, managers of multi-family housing properties and individuals. With access to approximately six million individual housing units, we believe this business line represents an opportunity for growth in a new market segment which is complementary to our route business. AWA is the product of two platform acquisitions which were consummated in 1997 and 1998, which acquisitions represented a combined rental fleet of 51,000 in Georgia and Texas. We have organically grown AWA’s operations to an installed fleet of approximately 198,000 across 28 states. We intend to continue our investment efforts in AWA in order to facilitate its ongoing growth. For the fiscal year ended March 31, 2004, revenue generated by AWA represented approximately 6% of our total revenue.

     Distribution Operations

     Super Laundry is a laundromat equipment distribution company which was incorporated in 1995. Super Laundry’s business consists of constructing complete turnkey retail laundromats, retrofitting existing retail laundromats, distributing exclusive and non-exclusive lines of commercial coin and non-coin operated machines and parts, and selling service contracts. Super Laundry’s customers generally enter into sales contracts pursuant to which Super Laundry constructs and equips a complete laundromat operation, including location identification, construction, plumbing, electrical wiring and all required permits. In addition, Super Laundry, through its wholly owned subsidiary, ALFC, builds and develops laundromat facilities for sale as franchise locations. For the fiscal year ended March 31, 2004, revenue generated by Super Laundry represented approximately 6% of our total revenue.

Competition

     The laundry equipment services industry is highly competitive, capital intensive and requires reliable and quality service. Despite the overall fragmentation of the industry, we believe there are currently three multi-regional route operators, including us, with significant operations throughout the United States. Our two major multi-regional competitors are Web Service Company, Inc. and Mac-Gray Corp.

Our Competitive Strengths

     Recurring Revenues and Stable Operating Cash Flows

     We derived 88% of our revenues for the fiscal year ended March 31, 2004 from our route business, primarily under long-term contracts with property management companies, owners of rental apartment buildings, condominiums and cooperatives, universities and other multi-family housing properties. Our recurring revenue base, stable capital expenditure requirements and minimal working capital requirements allow us to maintain predictable and consistent operating cash flows.

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     Diversified Customer Base

     No one customer accounts for more than 2% of our total revenues, with our ten largest customers representing less than 5% of our total revenues in the aggregate. As a result, the loss of any existing customer would not have a material impact on our revenues or cash flows. In addition, our contract expirations are staggered, further mitigating the impact of any individual contract renewal or loss.

     Geographic Diversity

     We believe that the scope of our operations throughout North America provides us with a competitive advantage over local and regional operators. In particular, our national platform positions us well to serve customers that own and operate residential units throughout the United States. Moreover, since our installed machine base is located in multiple regions, we are less susceptible than local and regional operators to the economic cycles which are oftentimes regional in nature.

     Regional Operations with National Leadership

     Our operating structure allows us to operate in a decentralized manner while at the same time maintaining centralized policies and controls. This structure enables regional offices to provide tailored support to local customers, while benefiting from a central corporate structure capable of providing advanced computer systems and management support. In addition, our structure allows regional managers to adapt operations and financial decision making criteria to the unique cost structures attributable to each region. Each regional manager’s compensation is linked to the financial performance of their region.

     Significant Economies of Scale

     We are able to leverage our infrastructure, including our sales, service, collections, security and corporate overhead, over a larger installed machine base than our competitors. Furthermore, we believe that we are able to purchase machines at a lower cost and on more favorable terms than those available to smaller industry participants. As a result of our size, scale and financial resources, we believe that we can offer more attractive lease terms (including advance locations payments, new equipment and capital improvements) than those offered by our competitors, while still meeting our cash flow and return on investment criteria.

     Advanced Management Information Systems

     We believe that we have the most advanced management information systems in our industry. Our integrated computer systems provide real time operational and competitive data that, in conjunction with our multi-regional service capabilities, enhance our efficiencies throughout our operating regions and enable us to deliver superior customer service. These integrated computer systems also provide us the flexibility to integrate acquisitions on a timely basis, including key functions such as sales, service, collections and security. We also believe that these computer systems will allow us to pursue opportunities outside of our route business.

     Secure System for Revenue Collection

     We believe that we provide the highest level of security for revenue collection control in the outsourced laundry equipment services industry. We utilize numerous precautionary procedures with respect to cash collection, including frequent alteration of collection patterns and extensive monitoring of collections and personnel. Security personnel monitor locations, conduct investigations and implement additional security procedures as necessary. Additionally, our security department performs trend and variance analyses of daily collections by location.

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     Experienced Senior Management Team

     We have a strong and experienced management team at the corporate and operating levels. Our senior management on average has been involved in the laundry equipment service industry and has been affiliated with us and our predecessors for over 20 years. We believe the skill and experience of our management team continue to provide significant benefits to us as we evaluate opportunities to enhance and expand our business.

Employees

     As of March 31, 2004, we employed 2,003 employees (including 304 laundromat attendants in our retail laundromats in Texas and Arizona). In the Northeast region, 121 hourly workers are represented by Local 966, affiliated with the International Brotherhood of Teamsters (the “Union”). We believe that we maintain a good relationship with the Union employees and we have never experienced a work stoppage since our inception.

General Development of Business

     Our original predecessor entity was founded over 50 years ago as a private, family-run business with operations in New York. Since then, the business has grown organically under its founders and subsequent owners.

     Since January 1995, we have enhanced our national presence by completing nine significant acquisitions (as well as numerous smaller acquisitions that we refer to as “tuck ins”), growing our washer and dryer machine base from approximately 55,000 machines in 5,000 locations to approximately 872,000 machines in approximately 80,000 locations as of March 31, 2004. As a result of this strategy, we have expanded our presence from the northeastern United States throughout North America.

     On May 12, 2000, Laundry Corp. entered into an Agreement and Plan of Merger with CLC Acquisition Corporation, a Delaware corporation which we refer to as “CLC Acquisition” and which was formed by Bruce V. Rauner, a director of us, Coinmach Corp. and Laundry Corp., a member of the Holdings board and a principal of the indirect general partner of GTCR Fund IV, Laundry Corp.’s then-largest stockholder. Pursuant to the merger agreement, CLC Acquisition acquired all of Laundry Corp.’s outstanding common stock and non-voting common stock for $14.25 per share in a two-step going-private transaction consisting of a tender offer followed by a merger transaction of CLC Acquisition with and into Laundry Corp. Effective July 13, 2000, CLC Acquisition was merged with and into Laundry Corp. pursuant to the terms of the merger agreement. Laundry Corp.’s Class A common stock was subsequently delisted from The NASDAQ Stock Market, and Laundry Corp. no longer was subject to the reporting requirements of the Exchange Act.) We refer to the foregoing transactions collectively as the “Going Private Transaction.”

     The AWA Transactions

     On November 29, 2002, Coinmach Corp. transferred all of the assets of the Appliance Warehouse division of Coinmach Corp. to AWA. The value of the assets transferred as determined by an independent appraiser as of such date was $34.7 million. In exchange for the transfer of such assets, AWA issued to Coinmach Corp. (i) an unsecured promissory note payable on demand in the amount of $19.6 million which accrues interest at a rate of 8% per annum, (ii) 1,000 shares of AWA preferred stock, with a liquidation value of $14.6 million, and (iii) 10,000 shares of AWA common stock. In March 2003, through a series of restructuring transactions, which we refer to herein as the “AWA Transactions,” all of the AWA common stock and all of the outstanding capital stock of Laundry Corp. was contributed to Holdings in exchange for equity interests (in the form of common and preferred membership units) in Holdings. As a result of the AWA Transactions, (i) Holdings became the sole holder of all of the outstanding AWA non-voting common stock, (ii) Coinmach Corp. became the sole holder of all of the outstanding AWA preferred stock, (iii) Laundry Corp. became a wholly owned subsidiary of Holdings, (iv) the former stockholders of Laundry Corp. became unitholders of Holdings and (v) AWA, subject to certain specified qualifications, became a guarantor under, and subject to the covenants contained in, the indenture governing the Coinmach Corp. 9% notes and the Coinmach Corp. credit facility. See Item 7“Management’s Discussion and

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Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Operating and Investing Activities.”

     Our headquarters is located at 303 Sunnyside Blvd., Suite 70, Plainview, New York 11803, and our telephone number is (516) 349-8555. Our mailing address is the same as that of our headquarters. We also maintain a corporate office in Charlotte, North Carolina. Our website address at www.coinmachservicecorp.com where general information about our business is available. The information contained in our website is not part of this annual report.

Senior Notes and Credit Facility

     On January 25, 2002, Coinmach Corp. issued $450 million of 9% Senior Notes due 2010 (the “Private 9% Senior Notes”). The Private 9% Senior Notes were exchanged for registered notes otherwise identical in all respects to the Private 9% Senior Notes (the “Registered 9% Senior Notes”, and together with the Private 9% Senior Notes, the “9% Senior Notes”) pursuant to a registration statement filed by us with the Securities and Exchange Commission, which registration statement was declared effective on July 15, 2003. The exchange of the Private 9% Senior Notes for the Registered 9% Senior Notes was completed on August 14, 2003.

     On January 25, 2002, Coinmach Corp. also entered into a new $355 million senior secured credit facility (the “Senior Secured Credit Facility”) comprised of: (i) $280 million in aggregate principal amount of term loans and (ii) a revolving credit facility with a maximum borrowing limit of $75 million. The Senior Secured Credit Facility includes up to $10 million of letter of credit financings and short term borrowings under a swing line facility of up to $7.5 million. The term loans under the Senior Secured Credit Facility, in aggregate principal amounts outstanding of $17.3 million and $243.0 million as of March 31, 2004, are scheduled to be fully repaid by January 25, 2008 and July 25, 2009, respectively. As of March 31, 2004, we had no amounts outstanding under our revolving credit facility, which is scheduled to expire on January 25, 2008.

     We used the net proceeds from the Private 9% Senior Notes, together with borrowings under the Senior Secured Credit Facility, to (i) redeem all of our outstanding 113/4% Senior Notes (including accrued interest and the resulting call premium), (ii) repay outstanding indebtedness under our prior senior credit facility, and (iii) pay related fees and expenses. The 113/4% Senior Notes were redeemed on February 25, 2002 with the funds that were set aside in escrow on January 25, 2002. See Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Financing Activities” for more information about the 9% Senior Notes and the Senior Secured Credit Facility.

Recent Developments

     On April 13, 2004, Coinmach Service Corp. (“CSC”), filed a registration statement on Form S-1 with the Securities and Exchange Commission, as amended by Amendment No. 1 to Form S-1 filed with the Securities and Exchange Commission on June 14, 2004, relating to a proposed offering of Income Deposit Securities (“IDSs”) which are securities consisting of CSC’s Class A common stock and senior secured notes, and a contemporaneous offering of third party notes separate and apart from the IDSs. Immediately following the offering and certain related corporate reorganization transactions, Laundry Corp. will become a direct wholly owned subsidiary of CSC. CSC, a Delaware corporation, was incorporated on December 23, 2003 and is currently a wholly owned subsidiary of Holdings. CSC has not had any activity from the date of incorporation through March 31, 2004. Holdings has agreed to fund CSC’s ongoing operations in the event the above mentioned transactions are not completed. The contemplated offerings and related transactions and use of proceeds therefrom are referred to herein collectively as the “IDS Transactions.”

     Pursuant to the proposed IDS Transactions, CSC will make an intercompany loan (the “Intercompany Loan”) to us and an indirect capital contribution (the “Capital Contribution”) from a portion of the proceeds from the IDS offering. We intend to use a portion of the Intercompany Loan and Capital Contribution to redeem a portion of our 9% Senior Notes and to repay a portion of the outstanding indebtedness under our Senior Secured Credit

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Facility. We have received the necessary consents of our lenders under the Senior Secured Credit Facility in order to permit the IDS Transactions.

     The Intercompany Loan is expected to be our senior unsecured obligation, will rank equally in right of payment with all our existing and future senior indebtedness and will rank senior in right of payment to all our existing and future subordinated indebtedness. Certain of our subsidiaries are expected to guarantee the Intercompany Loan on a senior unsecured basis. The Intercompany Loan is expected to contain covenants (other than a covenant providing for the delivery of reports to holders) that are substantially the same as those provided in the terms of the 9% Senior Notes; provided, however, that on the redemption or repayment in full of the 9% Senior Notes, the covenants contained in the Intercompany Loan will become substantially the same as those provided in the terms of such other indebtedness that refinances or replaces the 9% Senior Notes or, in the absence thereof, the notes which are a part of the IDSs. The Intercompany Loan will be pledged by us to secure the repayment of the notes which are a part of the IDSs.

     Pursuant to the IDS Transactions as presently contemplated, if at any time we are not prohibited from doing so under the terms of our then outstanding indebtedness, in the event that CSC undertakes a primary offering of the IDSs or its Class A common stock, a portion of the net proceeds of such offering will be loaned to us and increase the principal amount of the Intercompany Loan. Furthermore, pursuant to the IDS Transactions, if at any time we are not prohibited from doing so under the terms of our then outstanding debt, we will be required to guarantee the senior secured notes that are a part of the IDSs.

     If after the consummation of the IDS Transactions, we merge with or into CSC, the Intercompany Loan would be terminated and we, as a constituent corporation of the merged companies, would become responsible for the payment obligations relating to the IDSs and the third party notes which are separate and apart from the IDSs.

     If the IDS Transactions are consummated, we intend to adopt a dividend policy, in the event and to the extent that we have available cash for distribution, and, subject to applicable law and restrictions contained in certain of our outstanding debt and financing agreements relating to the payment of cash dividends on our common stock, to distribute funds to CSC to permit CSC to service its payment obligations under the IDSs and third party notes.

     In connection with the IDS Transactions, CSC is in the process of evaluating a long-term management incentive plan for our key employees which may take one of several forms including stock options, stock grants, dividend equivalents, and/or a performance-based cash plan.

     CSC has filed a registration statement on Form S-1 with the Securities and Exchange Commission relating to the proposed offering of IDSs and related transactions. There is no guarantee that the IDS Transactions will be consummated, in whole or in part, and CSC may elect at any time and for any reason not to proceed with the IDS Transactions or any or all of the related transactions.

ITEM 2. PROPERTIES

     As of March 31, 2004, we leased 65 offices throughout our operating regions serving various operational purposes, including sales and service activities, revenue collection and warehousing. A significant portion of our leased properties service our core route operations.

     We presently maintain our headquarters in Plainview, New York, leasing approximately 11,600 square feet pursuant to a ten-year lease scheduled to terminate September 30, 2011. Our Plainview facility is used for general and administrative purposes.

     We also maintain a corporate office in Charlotte, North Carolina, leasing approximately 3,000 square feet pursuant to a five-year lease scheduled to terminate September 30, 2006.

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ITEM 3. LEGAL PROCEEDINGS

     We are party to various legal proceedings arising in the ordinary course of business. Although the ultimate disposition of such proceedings is not presently determinable, management does not believe that adverse determinations in any or all such proceedings would have a material adverse effect upon our financial condition, results of operations or cash flows.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.

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PART II

ITEM 5. MARKET FOR THE OUR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Market Information

     There currently exists no established public trading market for our common stock, all of which is held beneficially and of record by Laundry Corp.

Holders

     As of March 31, 2004, there was one holder of record of our common stock.

Dividends

     We have not declared or paid any cash dividends on our common stock during the past two fiscal years. On March 4, 2003, in order to effect the AWA Transactions, we declared and paid a dividend on our common stock in the form of all of the outstanding AWA Common Stock. See Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Operating and Investing Activities.”

     Dividend payments by us are subject to restrictions contained in certain of our outstanding debt and financing agreements relating to the payment of cash dividends on our common stock. We may in the future enter into loan or other agreements or issue debt securities or preferred stock that restrict the payment of cash dividends or certain other distributions. See Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operation — Liquidity and Capital Resources.”

     If the IDS Transactions are consummated, we intend to adopt a dividend policy consistent with such transactions. See Item 1 “Business – Recent Developments.”

Laundry Corp. Equity Participation Purchase Program

     Pursuant Laundry Corp.’s equity participation purchase program, certain of our employees were eligible to acquire common stock of Laundry Corp. at a fixed price per share determined by the board of directors of Laundry Corp. Such shares were paid for by each participating employee and subject to vesting over a specified period, typically over 4 years. Additionally, in connection with the Going Private Transaction, certain members of our senior management were eligible to acquire preferred stock of Laundry Corp. Pursuant to the AWA Transactions, on March 6, 2003, all the outstanding capital stock of Laundry Corp., including shares of capital stock issued under the equity participation purchase program, was contributed to Holdings in exchange for substantially equivalent equity interests in Holdings. As of March 31, 2004, Holdings had issued and outstanding (i) 167,064,565 common units the (“Common Units”) of which 16,161,894 are issued to certain members of our senior management under Laundry Corp.’s equity participation purchase program, (ii) no Class A preferred units (the “Class A Preferred Units”), (iii) 51,923 Class B preferred units (the “Class B Preferred Units”), none of which are issued to our employees, and (iv) 135,295 Class C preferred units (the “Class C Preferred Units”, and collectively with the Class A Preferred Units and the Class B Preferred Units, the “Preferred Units”), 693 of which are issued to certain members of our senior management under Laundry Corp.’s equity participation purchase program.

     In connection with the IDS Transactions, CSC is in the process of evaluating a long term incentive plan for our key employees. See Item 1 “Business – Recent Developments.”

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ITEM 6. SELECTED FINANCIAL DATA

SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA

(In thousands of dollars, except ratios)

The following table presents selected consolidated historical financial data of Coinmach Corp. Such table includes the consolidated financial data for the year ended March 31, 2004 (“2004 Fiscal Year”), the year ended March 31, 2003 (“2003 Fiscal Year”), March 31, 2002 (“2002 Fiscal Year”), the nine month period from July 1, 2000 to March 31, 2001 (“Post-Transaction”), the three month period from April 1, 2000 to June 30, 2000 (“Pre-Transaction”), and the year ended March 31, 2000 (“2000 Fiscal Year”). The financial data set forth below should be read in conjunction with Coinmach Corp.’s audited consolidated historical financial statements and the related notes thereto included in Item 8 “Financial Statements and Supplementary Data” and with the information presented in Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Form 10-K.

(1)

Other items, net, in the 2004 Fiscal Year consists of a gain from the sale of an investment offset by various expenses relating to the consolidation of certain Super Laundry offices. Other items, net, 2003 Fiscal Year consists of a gain from the sale of an investment offset by various expenses relating to (i) the AWA Transactions, (ii) the formation of ALFC and (iii) the consolidation of certain Super Laundry offices.

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(i)

Loss on extinguishment of debt for the fiscal year ended March 31, 2002 consists of costs incurred in connection with Coinmach Corp.’s refinancing on January 25, 2002.

(4)		EBITDA margin represents EBITDA as a percentage of revenues. Management believes that EBITDA margin is a useful measure to evaluate Coinmach Corp.’s performance over various sales levels. EBITDA margin should not be considered as an alternative for measurements determined in accordance with accounting principles generally accepted in the United States.
(5)		Operating margin represents operating income as a percentage of revenues.
(6)		Capital expenditures represent amounts expended for property and equipment, for advance location payments to location owners. Acquisition capital expenditures represent the amounts expended to acquire local, regional and multi-regional route operators.