Exhibit
10.1


 


EXECUTIVE
SEVERANCE AGREEMENT


 


AGREEMENT made as of this
3rd day of March, 2008 by and between Mac-Gray Corporation, a Delaware
corporation with its principal place of business in Waltham, Massachusetts (the
“Company”), and                                       
(the “Executive”).


 


1.             Purpose.  The Company considers it essential to the
best interests of its stockholders to promote and preserve the continuous
employment of key management personnel. 
The Board of Directors of the Company (the “Board”) recognizes, however,
that, as is the case with many publicly held corporations, the possibility of a
Change in Control (as defined in Section 2 hereof) exists and that such
possibility, and the uncertainty and questions which it may raise among management,
may result in the departure or distraction of management personnel to the
detriment of the Company and its stockholders. 
Therefore, the Board has determined that appropriate steps should be
taken to reinforce and encourage the continued attention and dedication of
members of the Company’s management, including the Executive, to their assigned
duties without distraction in the face of potentially disturbing circumstances
arising from the possibility of a Change in Control.  Nothing in this Agreement shall be construed
as creating an express or implied contract of employment and, except as
otherwise agreed in writing between the Executive and the Company, the
Executive shall not have any right to be retained in the employ of the Company.


 


2.             Change in Control.  A “Change in Control” shall be deemed to have
occurred in any one of the following events:


 


(a)           any “person,” as such term is used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), (other than the Company, any of its subsidiaries,
or any trustee, fiduciary or other person or entity holding securities under
any employee benefit plan or trust of the Company or any of its subsidiaries),
together with all Affiliates and Associates (as such terms are hereinafter
defined) of such person, shall become the “beneficial owner” (as such term is
defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of
securities of the Company representing 25% (or in the case of a Grandfathered
Person, the Grandfathered Percentage applicable to such Grandfathered Person
(as such terms are hereinafter defined)) or more of the then outstanding shares
of common stock of the Company (the “Stock”) (in either such case other than as
a result of an acquisition of securities directly from the Company); or


 


(b)           persons who, as of the date hereof,
constitute the Company’s Board of Directors (the “Incumbent Directors”) cease
for any reason, including, without limitation, as a result of a tender offer,
proxy contest, merger or similar transaction, to constitute at least a majority
of the Board, provided that any person becoming a director of the Company
subsequent to the date hereof whose election or nomination for election was
approved by a vote of at least a majority of the Incumbent Directors shall, for
purposes of this Agreement, be considered as an Incumbent Director provided,
however, that there shall be excluded for consideration as an Incumbent
Director any individual whose initial assumption of office occurred as a result
of an actual or threatened election contest with respect to the election or
removal of directors or other actual or threatened solicitation of proxies or
consents, by or on behalf of a person other than the Board of Directors; or


 


 


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(c)           Upon (A) any consolidation or
merger of the Company where the shareholders of the Company, immediately prior
to the consolidation or merger, did not, immediately after the consolidation or
merger, beneficially own (as such term is defined in Rule 13d-3 of the
Exchange Act), directly or indirectly, shares representing in the aggregate
more than 50% of the voting shares of the corporation issuing cash or
securities in the consolidation or merger (or of its ultimate parent
corporation, if any), (B) any sale, lease, exchange or other transfer (in
one transaction or a series of transactions contemplated or arranged by any
party as a single plan) of all or substantially all of the assets of the
Company or (C) the approval by the stockholders of the Company of any plan
or proposal for the liquidation or dissolution of the Company.


 


(d)           Notwithstanding the foregoing, a “Change
in Control” shall not be deemed to have occurred for purposes of the foregoing
clause (a) solely as the result of an acquisition of securities by the
Company which, by reducing the number of shares of Stock outstanding, increases
the proportionate number of shares of Stock beneficially owned by any person to
25% (or in the case of a Grandfathered Person, the Grandfathered Percentage
applicable to such Grandfathered Person) or more of the shares of Stock then
outstanding; provided, however, that if any such person shall at any time
following such acquisition of securities by the Company become the beneficial
owner of any additional shares of Stock (other than pursuant to a stock split,
stock dividend, or similar transaction) and such person immediately thereafter
is the beneficial owner of 25% (or in the case of a Grandfathered Person, the
Grandfathered Percentage applicable to such Grandfathered Person) or more of
the shares of Stock then outstanding, then a “Change in Control” shall be
deemed to have occurred for purposes of the foregoing clause (a).


 


(e)           For purposes of this Agreement, the
following terms shall have the definitions set forth below:


 


(1)           “Family Stockholders”
shall mean any of The Evelyn C. MacDonald Family Trust for the benefit of
Stewart G. MacDonald, Jr. (the “ECM/SGM Trust”); The Evelyn C. MacDonald
Family Trust for the benefit of Sandra E. MacDonald (the “ECM/SEM Trust”); The
Evelyn C. MacDonald Family Trust for the benefit of Daniel W. MacDonald (the “ECM/DWM
Trust”); Stewart G. MacDonald, Jr.; Sandra E. MacDonald; The Stewart G.
MacDonald, Jr. 1984 Trust; The Daniel W. MacDonald Revocable Living Trust
(the “DWM Revocable Trust”); the New Century Trust; The Whitney E. MacDonald
GST Trust-1997 (the “WEM/GST Trust”); The Jonathan S. MacDonald GST Trust-1997
(the “JSM/GST Trust”); The Robert C. MacDonald GST Trust-1997 (the “RCM/GST
Trust”); The Whitney E. MacDonald Gift Trust (the “WEM Gift Trust”); The
Jonathan S. MacDonald Gift Trust (the “JSM Gift Trust”); The Robert C.
MacDonald Gift Trust (the “RCM Gift Trust”); Cynthia V. Doggett; the Richard G.
MacDonald 2004 Irrevocable Trust; the Sandra E. MacDonald 2005 Grantor Retained
Annuity Trust; Peter C. Bennett, in his capacity as a trustee of the ECM/SGM
Trust, the ECM/SEM Trust and the ECM/DWM Trust; R. Robert Woodburn, Jr.,
in his capacity as a trustee of the ECM/SGM Trust, the ECM/SEM Trust and the
ECM/DWM Trust; Richard G. MacDonald, in his capacity as a trustee of the
WEM/GST Trust, the JSM/GST Trust, the RCM/GST Trust, the WEM Gift Trust, the
JSM Gift Trust and the RCM Gift Trust; Gilbert M. Roddy, Jr., in his
capacity as a trustee of the New Century Trust; the Charles E. Clapp, III
custodial accounts for the benefit of Sawyer Doggett MacDonald, Stewart Gray
MacDonald, III, 


 


 


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Tucker
William MacDonald and Dylan Crowdis MacDonald; and any other shareholder of the
Company who becomes a party to the Stockholders’ Agreement.


 


(2)           “Grandfathered Percentage” shall mean
the percentage of the outstanding shares of Stock that a Grandfathered Person,
together with all Affiliates and Associates of such Grandfathered Person,
beneficially owns as of the Grandfathered Time plus an additional 3.0%.  Notwithstanding the foregoing, in the event
any Grandfathered Person shall sell, transfer, or otherwise dispose of any
outstanding shares of Stock after the Grandfathered Time, the Grandfathered
Percentage shall, subsequent to such sale, transfer or disposition, mean, with
respect to such Grandfathered Person, the lesser of (i) the Grandfathered
Percentage as in effect immediately prior to such sale, transfer or disposition
or (ii) the percentage of outstanding shares of Stock that such
Grandfathered Person beneficially owns immediately following such sale,
transfer or disposition plus an additional 3.0%.


 


(3)           “Grandfathered Person” shall mean any
one or more of the following persons: (A) Stewart G. MacDonald, Jr.
and his Affiliates and Associates, (B) Sandra E. MacDonald and her
Affiliates and Associates, (C) Daniel W. MacDonald and his Affiliates and
Associates, and (D) any other person who or which, together with all
Affiliates and Associates of such person, is, as of the Grandfathered Time, the
beneficial owner of 25% or more of the shares of Stock then outstanding.  Notwithstanding anything to the contrary
provided in this Agreement, any Grandfathered Person who after the
Grandfathered Time becomes, for any reason, the beneficial owner of less than
25% of the shares of Stock then outstanding shall cease to be a Grandfathered
Person.


 


(4)           “Grandfathered Time” shall mean 9:00 a.m.,
Boston, Massachusetts time, on March 3, 2008.


 


(5)           “Stockholders’ Agreement” shall mean
the Stockholders’ Agreement, dated as of June 26, 1997, by and among the
Company (f/k/a Mac-Gray II, Inc.) and ECM/SGM Trust; ECM/SEM
Trust; ECM/DWM Trust; Stewart G. MacDonald, Jr.; Sandra E. MacDonald; The
Stewart G. MacDonald, Jr. 1984 Trust; the DWM Revocable Trust; the New
Century Trust; the WEM/GST Trust; the JSM/GST Trust; the RCM/GST Trust; the WEM
Gift Trust; the JSM Gift Trust; the RCM Gift Trust; Cynthia V. Doggett; the
Richard G. MacDonald 2004 Irrevocable Trust; the Sandra E. MacDonald 2005
Grantor Retained Annuity Trust and certain other shareholders who may become
parties thereto, as amended from time to time.


 


(6)           “Affiliate” and “Associate” shall
have the respective meanings ascribed to such terms in Rule 12b-2 of the
Exchange Act, as in effect on the date of this Agreement; provided, however,
that no person who is a director or officer of the Company shall be deemed an
Affiliate or an Associate of any other director or officer of the Company
solely as a result of his position as director or officer of the Company.


 


(f)            For purposes of this Agreement, no
Family Stockholder or any of its Affiliates or Associates shall be deemed to
beneficially own any shares of Stock beneficially owned by any of the other
Family Stockholders as a result of such Family Stockholder’s execution of the
Stockholders’ Agreement or any of such Family Stockholder’s rights thereunder,
unless and until 


 


 


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such time as such Family
Stockholder actually purchases such shares of Stock through the exercise of its
right of first offer, or otherwise, pursuant to the provisions of the
Stockholders’ Agreement.


 


3.             Terminating Event.  A “Terminating Event” shall mean any of the
events provided in this Section 3 occurring subsequent to a Change in
Control as defined in Section 2:


 


(a)           termination by the Company of the
employment of the Executive with the Company for any reason other than (A) a
willful act of dishonesty by the Executive with respect to any matter involving
the Company or any subsidiary or affiliate, or (B) conviction of the
Executive of a crime involving moral turpitude, or (C) the gross or
willful failure by the Executive to substantially perform the Executive’s
duties with the Company (other than any such failure after the Executive gives
notice of termination for “Good Reason”), which failure is not cured within 30
days after a written demand for substantial performance is received by the
Executive from the Board of Directors of the Company which specifically
identifies the manner in which the Board of Directors believes the Executive
has not substantially performed the Executive’s duties, or (D) the failure
by the Executive to perform his full-time duties with the Company by reason of
his death or disability or (E) the willful failure of Executive to
cooperate with a bona fide internal investigation or an investigation by
regulatory or law enforcement authorities, after being instructed by the
Company to cooperate, or the willful destruction or failure to preserve
documents or other materials known to be relevant to such investigation or the
willful inducement of others to fail to cooperate or to produce documents or
other materials; provided, however, that a Terminating Event shall not be
deemed to have occurred pursuant to this Section 3(a) solely as a
result of the Executive being an employee of any direct or indirect successor
to the business or assets of the Company, rather than continuing as an employee
of the Company following a Change in Control. 
For purposes of clauses (A), (C) and (E) of this Section 3(a),
no act, or failure to act, on the Executive’s part shall be deemed “willful”
unless done, or omitted to be done, by the Executive without reasonable belief
that the Executive’s act, or failure to act, was in the best interests of the
Company and its subsidiaries and affiliates. 
For purposes of clause (D) of this Section 3(a), Section 6
and Section 8(b) hereof, “disability” shall mean the Executive’s
incapacity due to physical or mental illness which has caused the Executive to
be absent from the full-time performance of his duties with the Company for a
period of six (6) consecutive months if the Company shall have given
the Executive a Notice of Termination and, within thirty (30) days after such
Notice of Termination is given, the Executive shall not have returned to the
full-time performance of his duties.


 


(b)           termination by the Executive of the
Executive’s employment with the Company for “Good Reason.”  “Good Reason” shall mean the occurrence of
any of the following events:


 


(i)            an adverse change, not consented to
by the Executive, in the nature or scope of the Executive’s responsibilities,
authorities, powers, functions or duties from the responsibilities,
authorities, powers, functions or duties exercised by the Executive immediately
prior to the Change in Control; or


 


(ii)           a reduction in the Executive’s annual
base salary as in effect on the date hereof or as the same may be increased
from time to time hereafter; or


 


 


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(iii)          the relocation of the Company’s
offices at which the Executive is principally employed immediately prior to the
date of a Change in Control (the “Current Offices”) to any other location more
than fifty (50) miles from the Current Offices, or the requirement by the
Company for the Executive to be based anywhere other than the Current Offices,
except for required travel on the Company’s business to an extent substantially
consistent with the Executive’s business travel obligations immediately prior
to the Change in Control; or


 


(iv)          the failure by the Company to pay to
the Executive any portion of his compensation or to pay to the Executive any
portion of an installment of deferred compensation under any deferred
compensation program of the Company within fifteen (15) days of the date such
compensation is due without prior written consent of the Executive; or


 


(v)           the failure by the Company to obtain
an effective agreement from any successor to assume and agree to perform this
Agreement, as required by Section 18.


 


4.             Severance Payment.  In the event a Terminating Event occurs
within twenty-four (24) months after a Change in Control,


 


(a)           the Company shall pay to the
Executive an amount equal to two (2) times of the sum of (i) the
Executive’s average annual base salary over the three (3) fiscal years
immediately prior to the Terminating Event (or the Executive’s annual base
salary in effect immediately prior to the Change in Control, if higher) and (ii) the
Executive’s average annual bonus over the three (3) fiscal years
immediately prior to the Change in Control (or the Executive’s annual bonus for
the last fiscal year immediately prior to the Change in Control, if higher),
payable in one lump-sum payment no later than five (5) days following the
Date of Termination (subject to Section 5(c)).


 


(b)           the Company shall, regardless of
whether the Company is unable to utilize Company-related benefit plans,
continue to provide to the Executive certain benefits, including, without
limitation, health, dental and life insurance on the same terms and conditions
as though the Executive had remained an active employee, for twenty-four (24)
months;


 


(c)           the Company shall provide COBRA
benefits to the Executive following the end of the period referred to in Section 4(b) above,
such benefits to be determined as though the Executive’s employment had
terminated at the end of such period; and


 


(d)           the Company shall pay to the
Executive all reasonable legal and arbitration fees and expenses incurred by
the Executive in obtaining or enforcing any right or benefit provided by this
Agreement, except in cases involving frivolous or bad faith litigation.


 


5.                                       Additional Limitation.


 


(a)           Anything in this Agreement to the
contrary notwithstanding, in the event that any compensation, payment or
distribution by the Company to or for the benefit of the Executive, 


 


 


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whether paid or payable
or distributed or distributable pursuant to the terms of this Agreement or
otherwise (the “Severance Payments”), would be subject to the excise tax
imposed by Section 4999 of the Internal Revenue Code of 1986, as amended
(the “Code”), then the benefits payable under this Agreement shall be reduced
(but not below zero) to the extent necessary so that the maximum Severance
Payments shall not exceed the Threshold Amount. 
To the extent that there is more than one method of reducing the
payments to bring them within the Threshold Amount, the Executive shall
determine which method shall be followed; provided that if the Executive fails
to make such determination within 45 days after the Company has sent the
Executive written notice of the need for such reduction, the Company may
determine the amount of such reduction in its sole discretion.


 


For the purposes
of this Section 5, “Threshold Amount” shall mean three (3) times the
Executive’s “base amount” within the meaning of Section 280G(b)(3) of
the Code and the regulations promulgated thereunder less one dollar ($1.00);
and “Excise Tax” shall mean the excise tax imposed by Section 4999 of the
Code, and any interest or penalties incurred by the Executive with respect to
such excise tax.


 


(b)           The determination as to which of the
alternative provisions of Section 5(a) shall apply to the Executive
shall be made by a nationally recognized accounting firm selected by the
Executive (the “Accounting Firm”), which shall provide detailed supporting
calculations both to the Company and the Executive within fifteen (15) business
days of the Date of Termination, if applicable, or at such earlier time as is
reasonably requested by the Company or the Executive.  For purposes of determining which of the
alternative provisions of Section 5(a)  shall apply, the Executive
shall be deemed to pay federal income taxes at the highest marginal rate of
federal income taxation applicable to individuals for the calendar year in
which the determination is to be made, and state and local income taxes at the
highest marginal rates of individual taxation in the state and locality of the
Executive’s residence on the Date of Termination, net of the maximum reduction
in federal income taxes which could be obtained from deduction of such state
and local taxes.  Any determination by
the Accounting Firm shall be binding upon the Company and the Executive.  The Company shall bear the costs of the
Accounting Firm in connection with such firm’s services provided hereunder.


 


(c)           Notwithstanding anything herein to
the contrary, if at the time of the Executive’s termination of employment with
the Company, the Executive is a ‘specified employee’ within the meaning of Section 409A(a)(2)(B)(i) of
the Code and the regulations promulgated thereunder, and if any payment or
benefit that the Executive becomes entitled to under this Agreement would be
considered deferred compensation subject to interest and additional tax imposed
pursuant to Section 409A(a) of the Code as a result of the
application of Section 409A(a)(2)(B)(i) of the Code, then no such
payment or benefit shall be payable or provided prior to the date that is the
earlier of (A) six months after the Executive’s ‘separation from service’
within the meaning of Section 409A of the Code, or (B) the Executive’s
death. The parties intend that this Agreement will be administered in
accordance with Section 409A of the Code. 
The parties agree that this Agreement may be amended, as reasonably
requested by either party, and as may be necessary to fully comply with Section 409A
of the Code and all related rules and regulations in order to preserve the
payments and benefits provided hereunder without additional cost to either
party.


 


 


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6.             Term.  This Agreement shall take effect on the date
first set forth above and shall terminate upon the earlier of (a) the
termination by the Company of the employment of the Executive because of (A) a
willful act of dishonesty by the Executive with respect to any matter involving
the Company or any subsidiary or affiliate, or (B) conviction of the
Executive of a crime involving moral turpitude, or (C) the gross or
willful failure by the Executive to substantially perform the Executive’s
duties with the Company, or (D) the failure by the Executive to perform
his full-time duties with the Company by reason of his death or disability (as
defined in Section 3(a)), or (E) the willful failure of Executive to
cooperate with a bona fide internal investigation or an investigation by
regulatory or law enforcement authorities, after being instructed by the
Company to cooperate, or the willful destruction or failure to preserve
documents or other materials known to be relevant to such investigation or the
willful inducement of others to fail to cooperate or to produce documents or
other material, (b) the resignation or termination of the Executive for
any reason prior to a Change in Control, (c) the termination of the
Executive’s employment with the Company after a Change in Control for any
reason other than the occurrence of any of the events enumerated in Section 3(b)(i)-(v) of
this Agreement, or (d) the date which is twenty-four (24) months after a
Change in Control if the Executive is still employed by the Company.


 


7.             Withholding.  All payments made by the Company under this
Agreement shall be net of any tax or other amounts required to be withheld by
the Company under applicable law.


 


8.             Notice and Date of Termination;
Disputes; Etc.


 


(a)           Notice of Termination.  After a Change in Control and during the term
of this Agreement, any purported termination of the Executive’s employment
(other than by reason of death) shall be communicated by written Notice of
Termination from one party hereto to the other party hereto in accordance with
this Section 8.  For purposes of
this Agreement, a “Notice of Termination” shall mean a notice which shall
indicate the specific termination provision in this Agreement relied upon and
the Date of Termination.  Further, a
Notice of Termination pursuant to one or more of clauses (A) through (C) or
(E) of Section 3(a) hereof is required to include a copy of a
resolution duly adopted by the affirmative vote of not less than two-thirds
(2/3) of the entire membership of the Board at a meeting of the Board (after
reasonable notice to the Executive and an opportunity for the Executive,
accompanied by the Executive’s counsel, to be heard before the Board) finding
that, in the good faith opinion of the Board, the termination met the criteria
set forth in one or more of clauses (A) through (C) or (E) of
Section 3(a) hereof.


 


(b)           Date of Termination.  “Date of Termination”, with respect to any
purported termination of the Executive’s employment after a Change in Control
and during the term of this Agreement, shall mean (i) if the Executive’s
employment is terminated for disability, thirty (30) days after Notice of
Termination is given (provided that the Executive shall not have returned to
the full-time performance of the Executive’s duties during such 30-day period)
and (ii) if the Executive’s employment is terminated for any other reason,
the date specified in the Notice of Termination.  In the case of a termination by the Company
other than a termination pursuant to one or more of clauses (A) through (C) or
(E) of Section 3(a) (which may be effective immediately), the
Date of Termination shall not be less than 30 days after the Notice of 


 


 


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Termination is
given.  In the case of a termination by
the Executive, the Date of Termination shall not be less than fifteen (15) days
from the date such Notice of Termination is given.  Notwithstanding Section 3(a) of
this Agreement, in the event that the Executive gives a Notice of Termination
to the Company, the Company may unilaterally accelerate the Date of Termination
and such acceleration shall not result in a Terminating Event for purposes of Section 3(a) of
this Agreement.


 


(c)           No Mitigation.  The Company agrees that, if the Executive’s
employment by the Company is terminated during the term of this Agreement, the
Executive is not required to seek other employment or to attempt in any way to
reduce any amounts payable to the Executive by the Company pursuant to
Sections 4(a) and (b) hereof. 
Further, the amount of any payment provided for in this Agreement shall
not be reduced by any compensation earned by the Executive as the result of
employment by another employer, by retirement benefits, by offset against any
amount claimed to be owed by the Executive to the Company or otherwise.


 


(d)           Settlement and Arbitration of
Disputes.  Any controversy or claim
arising out of or relating to this Agreement or the breach thereof shall be
settled exclusively by arbitration in accordance with the laws of the
Commonwealth of Massachusetts by three arbitrators, one of whom shall be appointed
by the Company, one by the Executive and the third by the first two
arbitrators.  If the first two
arbitrators cannot agree on the appointment of a third arbitrator, then the
third arbitrator shall be appointed by the American Arbitration Association in
the City of Boston.  Such arbitration
shall be conducted in the City of Boston in accordance with the rules of
the American Arbitration Association for commercial arbitrations, except with
respect to the selection of arbitrators which shall be as provided in this Section 8(d).  Judgment upon the award rendered by the
arbitrators may be entered in any court having jurisdiction thereof.


 


9.             Successor to Executive.  This Agreement shall inure to the benefit of
and be enforceable by the Executive’s personal representatives, executors,
administrators, heirs, distributees, devisees and legatees.  In the event of the Executive’s death after a
Terminating Event but prior to the completion by the Company of all payments
due him under Section 4(a) and (b) of this Agreement, the
Company shall continue such payments to the Executive’s beneficiary designated
in writing to the Company prior to his death (or to his estate, if the
Executive fails to make such designation).


 


10.           Enforceability.  If any portion or provision of this Agreement
shall to any extent be declared illegal or unenforceable by a court of
competent jurisdiction, then the remainder of this Agreement, or the
application of such portion or provision in circumstances other than those as
to which it is so declared illegal or unenforceable, shall not be affected
thereby, and each portion and provision of this Agreement shall be valid and
enforceable to the fullest extent permitted by law.


 


11.           Waiver.  No waiver of any provision hereof shall be
effective unless made in writing and signed by the waiving party.  The failure of any party to require the
performance of any term or obligation of this Agreement, or the waiver by any
party of any breach of this Agreement, shall not prevent any subsequent
enforcement of such term or obligation or be deemed a waiver of any subsequent
breach.


 


 


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12.           Notices.  Any notices, requests, demands and other
communications provided for by this Agreement shall be sufficient if in writing
and delivered in person or sent by registered or certified mail, postage
prepaid, to the Executive at the last address the Executive has filed in
writing with the Company, or to the Company at its main office, attention of
the Board of Directors.


 


13.           Effect on Other Plans.  An election by the Executive to resign after
a Change in Control under the provisions of this Agreement shall not be deemed
a voluntary termination of employment by the Executive for the purpose of
interpreting the provisions of any of the Company’s benefit plans, programs or
policies.  Nothing in this Agreement
shall be construed to limit the rights of the Executive under the Company’s
benefit plans, programs or policies except as otherwise provided in Section 5
hereof, and except that the Executive shall have no rights to any severance
benefits under any severance pay plan.


 


14.           No Offset.   The Company’s obligation to make the
payments provided for in this Agreement and otherwise perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company or any of its Affiliates may have against the Executive or others
whether by reason of the Executive’s breach of this Agreement, subsequent
employment of the Executive, or otherwise.


 


15.           Entire Agreement.  This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes in all respects all prior agreements between the parties concerning
such subject matter.


 


16.           Amendment.  This Agreement may be amended or modified
only by a written instrument signed by the Executive and by a duly authorized
representative of the Company.


 


17.           Governing Law.  This is a Massachusetts contract and shall be
construed under and be governed in all respects by the laws of the Commonwealth
of Massachusetts.


 


18.           Obligations of Successors.  The Company shall require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise)
to all or substantially all of the business or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform if no such
succession had taken place.


 


19.           Confidential Information.  The Executive shall never use, publish or
disclose in a manner adverse to the Company’s interests, any proprietary or
confidential information relating to (a) the business, operations or
properties of the Company or any subsidiary or other affiliate of the Company,
or (b) any materials, processes, business practices, technology, know-how,
research, programs, customer lists, customer requirements or other information
used in the manufacture, sale or marketing of any of the respective products or
services of the Company or any subsidiary or other affiliate of the Company;
provided, however, that no breach or alleged breach of this Section 19
shall entitle the Company to fail to comply fully and in a timely manner 


 


 


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with any other provision
hereof.  Nothing in this Agreement shall
preclude the Company from seeking money damages, or equitable relief by
injunction or otherwise without the necessity of proving actual damage to the
Company, for any breach by the Executive hereunder.


 


 


IN WITNESS WHEREOF, this
Agreement has been executed as a sealed instrument by the Company by its duly
authorized officer, and by the Executive, as of the date first above written.


 


 


 


	
   

  	
  MAC-GRAY CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name: Stewart G.
  MacDonald, Jr.

  
	
   

  	
  Title: Chairman and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


 


 


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