Exhibit 4.2
THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE
ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS OR (B)
AN OPINION OF COUNSEL, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS OR (II) UNLESS SOLD
PURSUANT TO RULE 144 UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE
SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.
ANY TRANSFEREE OF THIS WARRANT SHOULD CAREFULLY REVIEW THE TERMS OF THIS
WARRANT, INCLUDING SECTION 2(e) HEREOF. THE SECURITIES REPRESENTED BY THIS
WARRANT MAY BE LESS THAN THE NUMBER SET FORTH ON THE FACE HEREOF PURSUANT TO
SECTION 2(e) HEREOF.
TRM CORPORATION
WARRANT TO PURCHASE COMMON STOCK
Warrant No.: 0002 Number of Shares: 98,306
Date of Issuance: November 20, 2006
TRM Corporation, an Oregon corporation (the "COMPANY"), hereby certifies that,
for Ten United States Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, GSO
Special Situations Overseas Benefit Plan Fund Ltd., the registered holder hereof
or its permitted assigns, is entitled, subject to the terms set forth below, to
purchase from the Company upon surrender of this Warrant (if required by Section
2(e)), at any time or times on or after the date hereof, but not after 11:59
P.M. New York Time on the Expiration Date (as defined herein) Ninety-Eight
Thousand Three Hundred Six (98,306) fully paid nonassessable shares of Common
Stock (as defined in Section 1(b)) of the Company (the "WARRANT SHARES") at the
Warrant Exercise Price (as defined in Section 1(b) below); provided, however,
that in no event shall the holder be entitled or required to exercise this
Warrant for a number of Warrant Shares in excess of that number of Warrant
Shares that, upon giving effect to such exercise, would cause the aggregate
number of shares of Common Stock beneficially owned by the holder and its
affiliates to exceed 9.99% of the outstanding shares of the Common Stock
following such exercise. For purposes of the foregoing proviso, the aggregate
number of shares of Common Stock beneficially owned by the holder and its
affiliates shall include the number of shares of Common Stock issuable upon
exercise of this Warrant with respect to which the determination of such proviso
is being made, but shall exclude shares of Common Stock that would be issuable
upon (i) exercise of the remaining, unexercised Second Lien Warrants (as defined
in Section 1(a)) beneficially owned by the holder and its affiliates and
(ii) exercise, conversion or exchange of the unexercised, unconverted or
unexchanged portion of any other securities of the Company beneficially owned by
the holder and its affiliates subject to a limitation on conversion, exercise or
exchange analogous to the limitation contained herein. Except as set forth in
the preceding sentence, for purposes of this paragraph, beneficial ownership
shall be calculated in accordance with Section 13(d) of the Securities Exchange
Act of 1934, as amended. For purposes of this Warrant, in determining the number
of outstanding shares of Common Stock a holder may rely on the number of
outstanding shares of Common Stock as reflected in (1) the Company's most recent
Form 10-Q or Form 10-K, as the case may be, (2) a more recent public
announcement by the Company or (3) any other notice by the Company or its
transfer agent setting forth the number of shares of Common Stock outstanding.
Upon the written request of any holder, the Company shall promptly, but in no
event later than one (1) Business Day following the receipt of such request,
confirm in writing to any such holder the number of shares of Common Stock then
outstanding. In any case, the number of outstanding shares of Common Stock shall
be determined after giving effect to the conversion, exercise or exchange of
securities of the Company, including the Second Lien Warrants by such holder and
its affiliates, since the date as of which such number of outstanding shares of
Common Stock was reported. For purposes of determining the maximum number of
shares of Common Stock that the Company may issue to the holder of this Warrant
upon exercise of this Warrant, such holder's delivery of an Exercise Notice (as
defined in Section 2(a)) with respect to such exercise shall constitute a
representation (on which the Company may rely without investigation) by the
holder of this Warrant that upon the issuance of the shares of Common Stock to
be issued to such holder, the shares of Common Stock beneficially owned by such
holder and its affiliates shall not exceed 9.99% of the total outstanding shares
of Common Stock of the Company immediately after giving effect to such exercise
as determined in accordance with this paragraph.
Section 1.
(a) Amended Second Lien Loan Agreement. This Warrant is one of the
warrants issued pursuant to Section 2.06 of that certain Amended and Restated
Second Lien Loan Agreement, dated as of November 20, 2006, among the Company and
the Persons (as defined below) referred to therein (as such agreement may be
amended from time to time as provided in such agreement, the "AMENDED SECOND
LIEN LOAN AGREEMENT") or of any warrants issued in exchange or substitution
therefor or replacement thereof (all such warrants being collectively referred
to as the "SECOND LIEN WARRANTS"). Each capitalized term used, and not otherwise
defined herein, shall have the meaning ascribed thereto in the Amended Second
Lien Loan Agreement.
(b) Definitions. The following words and terms as used in this Warrant
shall have the following meanings:
(i) "APPROVED STOCK PLAN" means any employee benefit plan that
has been approved by the Board of Directors and shareholders of the Company,
pursuant to which the Company's securities may be issued to any consultant,
employee, officer or director for services provided to the Company.
-2-
(ii) "BUSINESS DAY" means any day other than Saturday, Sunday or
other day on which commercial banks in the City of New York are authorized or
required by law to remain closed.
(iii) "COMMON STOCK" means (i) the Company's common stock, no par
value per share, and (ii) any capital stock into which such Common Stock shall
have been changed or any capital stock resulting from a reclassification of such
Common Stock.
(iv) "CONVERTIBLE SECURITY" means any stock or securities (other
than Options) directly or indirectly convertible into or exchangeable or
exercisable for Common Stock.
(v) "EXPIRATION DATE" means the date that is seven (7) years
after the Warrant Date (as defined in Section 13) or, if such date does not fall
on a Business Day, then the next Business Day.
(vi) "OPTIONS" means any rights, warrants or options to subscribe
for or purchase Common Stock or Convertible Securities.
(vii) "PERSON" means an individual, a limited liability company,
a partnership, a joint venture, a corporation, a trust, an unincorporated
organization or a government or any department or agency thereof or any other
legal entity.
(viii) "PRINCIPAL MARKET" means, with respect to the Common Stock
or any other security, the NASDAQ National Market, or, if the Common Stock or
such other security is not traded on the NASDAQ National Market, then the
principal securities exchange or trading market for the Common Stock or such
other security.
(ix) "REGISTRATION RIGHTS AGREEMENT" means that agreement dated
November 20, 2006, by and among the Company and the Persons referred to therein,
as such agreement may be amended from time to time as provided in such
agreement.
(x) "SECURITIES ACT" means the Securities Act of 1933, as
amended.
(xi) "TRADING DAY" means any day on which the Common Stock is
traded on the Principal Market; provided that "Trading Day" shall not include
any day on which the Common Stock is scheduled to trade, or actually trades, on
such exchange or market for less than 4.5 hours.
(xii) "WARRANT" means this Warrant and all Warrants issued in
exchange, transfer or replacement thereof pursuant to the terms of this Warrant.
(xiii) "WARRANT ALLOCATION PERCENTAGE" means the percentage
obtained by dividing (i) the number of Warrant Shares issuable to the initial
holder of this Warrant as of the Warrant Date, by (ii) the aggregate number of
Warrant Shares issuable pursuant to the Warrants.
(xiv) "WARRANT EXERCISE PRICE" shall be equal to, with respect to
any Warrant Share, 105% of the average of the Weighted Average Price of the
Common Stock for
-3-
the seven (7) Trading Days following the Warrant Date, subject to adjustment as
hereinafter provided.
(xv) "WEIGHTED AVERAGE PRICE" means, for any security as of any
date, the dollar volume-weighted average price for such security on its
Principal Market during the period beginning at 9:30 a.m., New York City Time
(or such other time as the Principal Market publicly announces is the official
open of trading), and ending at 4:00 p.m., New York City Time (or such other
time as the Principal Market publicly announces is the official close of
trading), as reported by Bloomberg Financial Markets (or any successor thereto,
"BLOOMBERG") through its "Volume at Price" functions, or, if the foregoing does
not apply, the dollar volume-weighted average price of such security in the
over-the-counter market on the electronic bulletin board for such security
during the period beginning at 9:30 a.m., New York City Time (or such other time
as such over-the-counter market publicly announces is the official open of
trading), and ending at 4:00 p.m., New York City Time (or such other time as
such over-the-counter market publicly announces is the official close of
trading), as reported by Bloomberg, or, if no dollar volume-weighted average
price is reported for such security by Bloomberg for such hours, the average of
the highest closing bid price and the lowest closing ask price of any of the
market makers for such security as reported in the "pink sheets" by the National
Quotation Bureau, Inc. If the Weighted Average Price cannot be calculated for
such security on such date on any of the foregoing bases, the Weighted Average
Price of such security on such date shall be the fair market value as mutually
determined by the Company and the holder of this Warrant. If the Company and the
holder of this Warrant are unable to agree upon the fair market value of the
Common Stock, then such dispute shall be resolved pursuant to Section 2(a)
below. All such determinations to be appropriately adjusted for any stock
dividend, stock split, stock combination or other similar transaction during any
period during which the Weighted Average Price is being determined.
Section 2. Exercise of Warrant.
(a) Subject to the terms and conditions hereof, this Warrant may be
exercised by the holder hereof then registered on the books of the Company, in
whole or in part, at any time on any Business Day on or after the opening of
business on the date hereof and prior to 11:59 P.M. New York Time on the
Expiration Date by (i) delivery of a written notice, in the form of the
subscription form attached as Exhibit A hereto (the "EXERCISE NOTICE"), of such
holder's election to exercise this Warrant, which notice shall specify the
number of Warrant Shares to be purchased, (ii) (A) payment to the Company of an
amount equal to the Warrant Exercise Price multiplied by the number of Warrant
Shares as to which this Warrant is being exercised (the "AGGREGATE EXERCISE
PRICE") by wire transfer of immediately available funds (or by check if the
Company has not provided the holder of this Warrant with wire transfer
instructions for such payment) or (B) by notifying the Company that this Warrant
is being exercised pursuant to a Cashless Exercise (as defined in Section 2(d)),
and (iii) if required by Section 2(e) or unless the Holder has previously
delivered this Warrant to the Company and it or a new replacement Warrant has
not yet been delivered to the Holder, the surrender to a common carrier for
overnight delivery to the Company as soon as practicable following such date,
this Warrant (or an indemnification undertaking with respect to this Warrant in
the case of its loss, theft or destruction); provided, that if such Warrant
Shares are to be issued in any name other than that of the registered holder of
this Warrant, such issuance shall be deemed a transfer and the provisions of
Section 7 shall be applicable. In the event of any exercise of the rights
-4-
represented by this Warrant in compliance with this Section 2(a), the Company
shall on the second (2nd) Business Day (the "WARRANT SHARE DELIVERY DATE")
following the date of its receipt of the later of the Exercise Notice, the
Aggregate Exercise Price (or notice of Cashless Exercise) and if required by
Section 2(e) (or unless the holder of this Warrant has previously delivered this
Warrant to the Company and it or a new replacement Warrant has not yet been
delivered to the holder), this Warrant (or an indemnification undertaking with
respect to this Warrant in the case of its loss, theft or destruction) (the
"EXERCISE DELIVERY DOCUMENTS"), issue and deliver to the address specified in
the Exercise Notice, a certificate, registered in the name of the holder or its
designee, for the number of shares of Common Stock to which the holder shall be
entitled. Upon the later of the date of delivery of (x) the Exercise Notice and
(y) the Aggregate Exercise Price referred to in clause (ii)(A) above or
notification to the Company of a Cashless Exercise referred to in Section 2(d),
the holder of this Warrant shall be deemed for all purposes to have become the
holder of record of the Warrant Shares with respect to which this Warrant has
been exercised (the date thereof being referred to as the "DEEMED ISSUANCE
DATE"), irrespective of the date of delivery of this Warrant as required by
clause (iii) above or the certificates evidencing such Warrant Shares. In the
case of a dispute as to the determination of the Warrant Exercise Price, the
Weighted Average Price of a security or the arithmetic calculation of the number
of Warrant Shares, the Company shall promptly issue to the holder the number of
shares of Common Stock that is not disputed and shall submit the disputed
determinations or arithmetic calculations to the holder via facsimile within two
(2) Business Days of receipt of the holder's Exercise Notice. If the holder and
the Company are unable to agree upon the determination of the Warrant Exercise
Price, the Weighted Average Price or arithmetic calculation of the number of
Warrant Shares within one (1) Business Day of such disputed determination or
arithmetic calculation being submitted to the holder, then the Company shall
promptly submit via facsimile (i) the disputed determination of the Warrant
Exercise Price or the Weighted Average Price to an independent, reputable
investment banking firm agreed to by the Company and the holder of this Warrant
or (ii) the disputed arithmetic calculation of the number of Warrant Shares to
its independent, outside public accountant. The Company shall direct the
investment banking firm or the accountant, as the case may be, to perform the
determinations or calculations and notify the Company and the holder of the
results no later than two (2) Business Days after the date it receives the
disputed determinations or calculations. Such investment banking firm's or
accountant's determination or calculation, as the case may be, shall be deemed
conclusive absent demonstrable error.
(b) If this Warrant is submitted for exercise, as may be required by
Section 2(e), and unless the rights represented by this Warrant shall have
expired or shall have been fully exercised, the Company shall, as soon as
practicable and in no event later than four (4) Business Days after receipt of
this Warrant (the "WARRANT DELIVERY DATE") and at its own expense, issue a new
Warrant identical in all respects to this Warrant except it shall represent
rights to purchase the number of Warrant Shares purchasable immediately prior to
such exercise under this Warrant, less the number of Warrant Shares with respect
to which such Warrant is exercised (together with, in the case of a cashless
exercise, the number of Warrant Shares surrendered in lieu of payment of the
Exercise Price).
(c) No fractional shares of Common Stock are to be issued upon the
exercise of this Warrant, but rather the number of shares of Common Stock issued
upon exercise of this Warrant shall be rounded up or down to the nearest whole
number (with 0.5 rounded up).
-5-
(d) If, despite the Company's obligations under the Amended Second
Lien Loan Agreement and the Registration Rights Agreement, the Warrant Shares to
be issued are not registered and available for resale pursuant to a registration
statement in accordance with the Registration Rights Agreement, including during
a Grace Period (as defined in the Registration Rights Agreement), then
notwithstanding anything contained herein to the contrary, the holder of this
Warrant may, at its election exercised in its sole discretion, exercise this
Warrant in whole or in part and, in lieu of making the cash payment otherwise
contemplated to be made to the Company upon such exercise in payment of the
Aggregate Exercise Price, elect instead to receive upon such exercise the "Net
Number" of shares of Common Stock determined according to the following formula
(a "CASHLESS EXERCISE"):
Net Number = (A x B) - (A x C)
-----------------
B
For purposes of the foregoing formula:
A= the total number of shares with respect to which this Warrant
is then being exercised;
B= the Weighted Average Price of the Common Stock on the trading
day immediately preceding the date of the delivery of the
Exercise Notice; and
C= the Warrant Exercise Price then in effect for the applicable
Warrant Shares at the time of such exercise.
(e) Book-Entry. Notwithstanding anything to the contrary set forth
herein, upon exercise of this Warrant in accordance with the terms hereof, the
holder of this Warrant shall not be required to physically surrender this
Warrant to the Company unless it is being exercised for all of the Warrant
Shares represented by the Warrant. The holder and the Company shall maintain
records showing the number of Warrant Shares exercised and issued and the dates
of such exercises or shall use such other method, reasonably satisfactory to the
holder and the Company, so as not to require physical surrender of this Warrant
upon each such exercise. In the event of any dispute or discrepancy, such
records of the Company establishing the number of Warrant Shares to which the
holder is entitled shall be controlling and determinative in the absence of
demonstrable error. Notwithstanding the foregoing, if this Warrant is exercised
as aforesaid, the holder may not transfer this Warrant unless the holder first
physically surrenders this Warrant to the Company, whereupon the Company will
forthwith issue and deliver upon the order of the holder a new Warrant of like
tenor, registered as the holder may request, representing in the aggregate the
remaining number of Warrant Shares represented by this Warrant. The holder and
any assignee, by acceptance of this Warrant, acknowledge and agree that, by
reason of the provisions of this paragraph, following exercise of any portion of
this Warrant, the number of Warrant Shares represented by this Warrant may be
less than the number stated on the face hereof. Each Warrant shall bear the
following legend:
-6-
ANY TRANSFEREE OF THIS WARRANT SHOULD CAREFULLY REVIEW THE TERMS OF
THIS WARRANT, INCLUDING SECTION 2(e) HEREOF. THE SECURITIES
REPRESENTED BY THIS WARRANT MAY BE LESS THAN THE NUMBER SET FORTH ON
THE FACE HEREOF PURSUANT TO SECTION 2(e) HEREOF.
Section 3. Covenants as to Common Stock. The Company hereby covenants and
agrees as follows:
(a) This Warrant is, and any Warrants issued in substitution for or
replacement of this Warrant will upon issuance be, duly authorized and validly
issued.
(b) All Warrant Shares that may be issued upon the exercise of the
rights represented by this Warrant will, upon issuance, be validly issued, fully
paid and nonassessable and free from all taxes, liens and charges with respect
to the issue thereof.
(c) During the period within which the rights represented by this
Warrant may be exercised, the Company will at all times have authorized and
reserved at least 110% of the number of shares of Common Stock needed to provide
for the exercise of the rights then represented by this Warrant.
(d) The Company shall promptly secure the listing of the shares of
Common Stock issuable upon exercise of this Warrant on the Principal Market
(subject to official notice of issuance upon exercise of this Warrant) and each
other market or exchange on which the Common Stock is traded or listed and shall
maintain, so long as any other shares of Common Stock shall be so traded or
listed, such listing of all shares of Common Stock from time to time issuable
upon the exercise of this Warrant; and the Company shall so list on the
Principal Market and each other market or exchange on which the Common Stock is
traded or listed and shall maintain such listing of, any other shares of capital
stock of the Company issuable upon the exercise of this Warrant if and so long
as any shares of the same class shall be listed on the Principal Market and each
other market or exchange on which the Common Stock is traded or listed.
(e) The Company will not, by amendment of its Articles of
Incorporation or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities, or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms to be
observed or performed by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all such action as may reasonably be requested by the holder of this
Warrant in order to protect the exercise privilege of the holder of this Warrant
against impairment, consistent with the tenor and purpose of this Warrant.
Without limiting the generality of the foregoing, the Company (i) will not
increase the par value of any shares of Common Stock receivable upon the
exercise of this Warrant, and (ii) will take all such actions as may be
-7-
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant.
(f) This Warrant will be binding upon any entity succeeding to the
Company by merger, consolidation or acquisition of all or substantially all of
the Company's assets.
Section 4. Taxes. The Company shall pay any and all taxes (excluding income
taxes, franchise taxes or other taxes levied on gross earnings, profits or the
like of the holder of this Warrant) that may be payable with respect to the
issuance and delivery of Warrant Shares upon exercise of this Warrant.
Section 5. Warrant Holder Not Deemed a Shareholder. No holder, as such, of
this Warrant shall be entitled to vote or receive dividends or be deemed the
holder of shares of the Company for any purpose (other than to the extent that
the holder is deemed to be a beneficial holder of shares under applicable
securities laws after taking into account the limitation set forth in the first
paragraph of this Warrant), nor shall anything contained in this Warrant be
construed to confer upon the holder hereof, as such, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to any
corporate action (whether any reorganization, issue of stock, reclassification
of stock, consolidation, merger, conveyance or otherwise), receive notice of
meetings, receive dividends or subscription rights, or otherwise, prior to the
Deemed Issuance Date of the Warrant Shares that such holder is then entitled to
receive upon the due exercise of this Warrant. In addition, nothing contained in
this Warrant shall be construed as imposing any obligations or liabilities on
such holder to purchase any securities (upon exercise of this Warrant or
otherwise) or as a shareholder of the Company, whether such liabilities are
asserted by the Company or by creditors of the Company. Notwithstanding this
Section 5, the Company will provide the holder of this Warrant with copies of
the same notices and other information given to the shareholders of the Company
generally, contemporaneously with the giving thereof to the shareholders.
Section 6. Representations of Holder. The holder of this Warrant, by the
acceptance hereof, represents that it is acquiring this Warrant, and upon
exercise hereof (other than pursuant to a Cashless Exercise) will acquire the
Warrant Shares, for its own account and not with a view towards, or for resale
in connection with, the public sale or distribution of this Warrant or the
Warrant Shares, except pursuant to sales registered or exempted under the
Securities Act; provided, however, that by making the representations herein,
the holder does not agree to hold this Warrant or any of the Warrant Shares for
any minimum or other specific term and reserves the right to dispose of this
Warrant and the Warrant Shares at any time in accordance with or pursuant to a
registration statement or an exemption under the Securities Act. The holder of
this Warrant further represents, by acceptance hereof, that, as of this date,
such holder is an "accredited investor" as such term is defined in Rule
501(a)(3) of Regulation D promulgated by the Securities and Exchange Commission
under the Securities Act (an "ACCREDITED INVESTOR") and has had the opportunity
to ask questions and receive answers concerning the Company, the Second Lien
Warrants and the offering thereof from the Company. Each delivery of an Exercise
Notice, other than in connection with a Cashless Exercise, shall constitute
confirmation at such time by the holder of the representations concerning the
Warrant Shares set forth in the first two sentences of this Section 6, unless
contemporaneous with the delivery of such Exercise Notice,
-8-
the holder notifies the Company in writing that it is not making such
representations (a "REPRESENTATION NOTICE"). If the holder delivers a
Representation Notice in connection with an exercise, it shall be a condition to
such holder's exercise of this Warrant and the Company's obligations set forth
in Section 2 in connection with such exercise, that the Company receive such
other representations as the Company considers reasonably necessary to assure
the Company that the issuance of its securities upon exercise of this Warrant
shall not violate any United States or state securities laws, and the time
periods for the Company's compliance with its obligations set forth in Section 2
shall be tolled until such holder provides the Company with such other
representations.
Section 7. Ownership and Transfer.
(a) The Company shall maintain at its principal executive offices or
at the offices of its transfer agent (or such other office or agency of the
Company as it may designate by notice to the holder hereof), a register for this
Warrant, in which the Company shall record the name and address of the person in
whose name this Warrant has been issued, as well as the name and address of each
transferee. The Company may treat the person in whose name any Warrant is
registered on the register as the owner and holder thereof for all purposes,
notwithstanding any notice to the contrary, but in all events recognizing any
transfers made in accordance with the terms of this Warrant.
(b) This Warrant and the rights granted hereunder shall be assignable
by the holder hereof without the consent of the Company.
(c) The Company is obligated to register the Warrant Shares for resale
under the Securities Act pursuant to the Registration Rights Agreement, and the
initial holder of this Warrant (and assignees thereof) is entitled to the
registration rights in respect of the Warrant Shares as set forth in the
Registration Rights Agreement.
Section 8. Adjustment of Warrant Exercise Price and Number of Warrant
Shares. The Warrant Exercise Price and the number of shares of Common Stock
issuable upon exercise of this Warrant shall be adjusted from time to time as
follows:
(a) Adjustment of Warrant Exercise Price and Number of Shares upon
Issuance of Common Stock. If and whenever on or after the Warrant Date, the
Company issues or sells, or is deemed to have issued or sold, any shares of
Common Stock (including the issuance or sale of shares of Common Stock owned or
held by or for the account of the Company, but excluding Exempted Issuances (as
defined below)), for a consideration per share less than a price equal to the
Warrant Exercise Price in effect immediately prior to such issuance or sale (the
"APPLICABLE PRICE"), then immediately after such issue or sale the Warrant
Exercise Price then in effect shall be reduced to an amount equal to such
consideration per share. Upon each such adjustment of the Warrant Exercise Price
pursuant to the immediately preceding sentence, the number of shares of Common
Stock acquirable upon exercise of this Warrant shall be adjusted to the number
of shares determined by multiplying the Warrant Exercise Price in effect
immediately prior to such adjustment by the number of shares of Common Stock
acquirable upon exercise of this Warrant immediately prior to such adjustment
and dividing the product thereof by the Warrant Exercise Price resulting from
such adjustment. For purposes of this Warrant, "EXEMPTED ISSUANCES"
-9-
shall mean: (I) shares of Common Stock issued or deemed to be issued by the
Company pursuant to an Approved Stock Plan, provided that the number of such
shares issued or deemed to be issued does not exceed an aggregate of 20% of the
shares of Common Stock outstanding as of the Warrant Date; or (II) shares of
Common Stock issued or deemed to be issued by the Company upon exercise of the
Second Lien Warrants.
(b) Effect on Warrant Exercise Price of Certain Events. For purposes
of determining the adjusted Warrant Exercise Price under Section 8(a) above, the
following shall be applicable to issuances other than Exempted Issuances:
(i) Issuance of Options. If the Company in any manner grants or
sells any Options and the lowest price per share for which one share of Common
Stock is issuable upon the exercise of any such Option or upon conversion,
exchange or exercise of any Convertible Securities issuable upon exercise of any
such Option is less than the Applicable Price, then such share of Common Stock
shall be deemed to be outstanding and to have been issued and sold by the
Company at the time of the granting or sale of such Option for such price per
share. For purposes of this Section 8(b)(i), the "lowest price per share for
which one share of Common Stock is issuable upon exercise of any such Option or
upon conversion, exchange or exercise of any Convertible Security issuable upon
exercise of any such Option" shall be equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the Company with respect to any
one share of Common Stock upon the granting or sale of such Option, upon
exercise of such Option and upon conversion, exchange or exercise of any
Convertible Security issuable upon exercise of such Option. No further
adjustment of the Warrant Exercise Price shall be made upon the actual issuance
of such Common Stock or of such Convertible Security upon the exercise of such
Option or upon the actual issuance of such Common Stock upon conversion,
exchange or exercise of such Convertible Security.
(ii) Issuance of Convertible Securities. If the Company in any
manner issues or sells any Convertible Securities and the lowest price per share
for which one share of Common Stock is issuable upon the conversion, exchange or
exercise thereof is less than the Applicable Price, then such share of Common
Stock shall be deemed to be outstanding and to have been issued and sold by the
Company at the time of the issuance or sale of such Convertible Securities for
such price per share. For the purposes of this Section 8(b)(ii), the "lowest
price per share for which one share of Common Stock is issuable upon such
conversion, exchange or exercise" shall be equal to the sum of the lowest
amounts of consideration (if any) received or receivable by the Company with
respect to one share of Common Stock upon the issuance or sale of any such
Convertible Security and upon conversion, exchange or exercise of such
Convertible Security. No further adjustment of the Warrant Exercise Price shall
be made upon the actual issuance of such Common Stock upon conversion, exchange
or exercise of such Convertible Security, and if any such issue or sale of such
Convertible Security is made upon exercise of any Option for which adjustment of
the Warrant Exercise Price had been or are to be made pursuant to other
provisions of this Section 8(b), no further adjustment of the Warrant Exercise
Price shall be made by reason of such issue or sale.
(iii) Change in Option Price or Rate of Conversion. If the
purchase, exchange or exercise price provided for in any Options, the additional
consideration, if any, payable upon the issue, conversion, exchange or exercise
of any Convertible Securities, or the
-10-
rate at which any Options or Convertible Securities are convertible into or
exchangeable or exercisable for Common Stock changes at any time, the Warrant
Exercise Price in effect at the time of such change shall be adjusted to the
Warrant Exercise Price that would have been in effect at such time had such
Options or Convertible Securities provided for such changed purchase, exchange
or exercise price, additional consideration or changed conversion rate, as the
case may be, at the time initially granted, issued or sold and the number of
shares of Common Stock acquirable hereunder shall be correspondingly readjusted.
For purposes of this Section 8(b)(iii), if the terms of any Option or
Convertible Security that was outstanding as of the date of issuance of this
Warrant are changed in the manner described in the immediately preceding
sentence, then such Option or Convertible Security and the Common Stock deemed
issuable upon exercise, conversion or exchange thereof shall be deemed to have
been issued as of the date of such change. No adjustment shall be made if such
adjustment would result in an increase of the Warrant Exercise Price then in
effect.
(c) Effect on Warrant Exercise Price of Certain Events. For purposes
of determining the adjusted Warrant Exercise Price under Sections 8(a) and 8(b),
the following shall be applicable:
(i) Calculation of Consideration Received. In case any Options
are issued in connection with the issue or sale of other securities of the
Company, together comprising one integrated transaction or series of related
transactions, (A) the Options will be deemed to have been issued for a
consideration equal to the greater of $0.01 and the specific aggregate
consideration, if any, allocated to such Options (in either case, the "OPTION
CONSIDERATION") and, for purposes of applying the provisions of this Section 8,
the Option Consideration shall be allocated pro rata among all the shares of
Common Stock issuable upon exercise of such Options to determine the
consideration per each such share of Common Stock and (B) the other securities
will be deemed to have been issued for an aggregate consideration equal to the
aggregate consideration received by the Company for the Options and other
securities (determined as provided below with respect to each share of Common
Stock represented thereby), less the sum of (1) the Black-Scholes Value (as
defined below) of such Options and (2) the Option Consideration. If any Common
Stock, Options or Convertible Securities are issued or sold or deemed to have
been issued or sold for cash, the consideration received therefor will be deemed
to be the net amount received by the Company therefor. If any Common Stock,
Options or Convertible Securities are issued or sold for a consideration other
than cash, the amount of such consideration received by the Company will be the
fair value of such consideration, except where such consideration consists of
marketable securities, in which case the amount of consideration received by the
Company will be the Weighted Average Price of such securities on the date of
receipt of such securities. If any Common Stock, Options or Convertible
Securities are issued to the owners of the non-surviving entity in connection
with any merger in which the Company is the surviving entity, the amount of
consideration therefor will be deemed to be the fair value of such portion of
the net assets and business of the non-surviving entity as is attributable to
such Common Stock, Options or Convertible Securities, as the case may be. The
fair value of any consideration other than cash or securities will be determined
jointly by the Company and the holder of this Warrant. If such parties are
unable to reach agreement within ten (10) days after the occurrence of an event
requiring valuation (the "VALUATION EVENT"), the fair value of such
consideration will be determined within five (5) Business Days after the tenth
(10th) day following the Valuation Event by an independent,
-11-
reputable appraiser jointly selected by the Company and the holder of this
Warrant. The determination of such appraiser shall be final and binding upon all
parties absent demonstrable error, and the fees and expenses of such appraiser
shall be borne by the Company.
(ii) Record Date. If the Company takes a record of the holders of
Common Stock for the purpose of entitling them (1) to receive a dividend or
other distribution payable in Common Stock, Options or in Convertible Securities
or (2) to subscribe for or purchase Common Stock, Options or Convertible
Securities, then such record date will be deemed to be the date of the issue or
sale of the shares of Common Stock deemed to have been issued or sold upon the
declaration of such dividend or the making of such other distribution or the
date of the granting of such right of subscription or purchase, as the case may
be.
(iii) Black-Scholes Value. The "BLACK-SCHOLES VALUE" of any
Options shall mean the sum of the amounts resulting from applying the
Black-Scholes pricing model to each such Option, which calculation is made with
the following inputs: (i) the "option striking price" being equal to the lowest
exercise price possible under the terms of such Option on the date of the
issuance of such Option (the "VALUATION DATE"), (ii) the "interest rate" being
equal to the interest rate on one-year United States Treasury Bills issued most
recently prior to the Valuation Date, (iii) the "time until option expiration"
being the time from the Valuation Date until the expiration date of such Option,
(iv) the "current stock price" being equal to the Weighted Average Price of the
Common Stock on the Valuation Date, (v) the "volatility" being the 100-day
historical volatility of the Common Stock as of the Valuation Date (as reported
by the Bloomberg "HVT" screen), and (vi) the "dividend rate" being equal to
zero. Within three (3) Business Days after the Company Valuation Date, each of
the Company and the holder of this Warrant shall deliver to the other a written
calculation of its determination of the Black-Scholes value of the Options. If
the holder and the Company are unable to agree upon the calculation of the
Black-Scholes Value of the Options within five (5) Business Days of the
Valuation Date, then the Company shall submit via facsimile the disputed
calculation to an investment banking firm or accounting firm (jointly selected
by the Company and the holder of this Warrant) within seven (7) Business Days of
the Valuation Date. The Company shall direct such investment banking firm or
accounting firm to perform the calculations and notify the Company and the
holder of the results no later than ten (10) Business Days after the Valuation
Date. Such investment banking firm's or accounting firm's calculation of the
Black-Scholes Value of the Options shall be deemed conclusive absent
demonstrable error. The Company shall bear the fees and expenses of such
investment banking firm or accounting firm for providing such calculation.
(d) Adjustment of Warrant Exercise Price upon Subdivision or
Combination of Common Stock. If the Company at any time after the date of
issuance of this Warrant subdivides (by any stock split, stock dividend,
recapitalization or otherwise) its outstanding shares of Common Stock into a
greater number of shares, the Warrant Exercise Price in effect immediately prior
to such subdivision will be proportionately reduced and the number of shares of
Common Stock obtainable upon exercise of this Warrant will be proportionately
increased. If the Company at any time after the date of issuance of this Warrant
combines (by combination, reverse stock split or otherwise) its outstanding
shares of Common Stock into a smaller number of shares, the Warrant Exercise
Price in effect immediately prior to such combination will be proportionately
increased and the number of shares of Common Stock obtainable upon exercise of
this Warrant will be proportionately decreased. Any adjustment under this
Section 8(d) shall
-12-
become effective at the close of business on the date the subdivision or
combination becomes effective
(e) Distribution of Assets. If the Company shall declare or make any
dividend or other distribution of its assets (or rights to acquire its assets)
to holders of Common Stock, by way of return of capital or otherwise (including
any distribution of cash, stock or other securities, property or options by way
of a dividend, spin off, reclassification, corporate rearrangement or other
similar transaction) (a "Distribution"), at any time after the issuance of this
Warrant, then, in each such case:
(i) the Warrant Exercise Price in effect immediately prior to the
close of business on the record date fixed for the determination of holders of
Common Stock entitled to receive the Distribution shall be reduced, effective as
of the close of business on such record date, to a price determined by
multiplying such Warrant Exercise Price by a fraction of which (A) the numerator
shall be the Weighted Average Price of the Common Stock on the trading day
immediately preceding such record date minus the value of the Distribution (as
determined in good faith by the Company's Board of Directors) applicable to one
share of Common Stock, and (B) the denominator shall be the Weighted Average
Price of the Common Stock on the trading day immediately preceding such record
date; and
(ii) either (A) the number of Warrant Shares obtainable upon
exercise of this Warrant shall be increased to a number of shares equal to the
number of shares of Common Stock obtainable immediately prior to the close of
business on the record date fixed for the determination of holders of Common
Stock entitled to receive the Distribution multiplied by the reciprocal of the
fraction set forth in the immediately preceding clause (i), or (B) in the event
that the Distribution is of common stock of a company whose common stock is
traded on a national securities exchange or a national automated quotation
system, then the holder of this Warrant shall receive an additional warrant, the
terms of which shall be identical to those of this Warrant, except that such
warrant shall be exercisable for the amount of the assets that would have been
payable to the holder of this Warrant pursuant to the Distribution had the
holder exercised this Warrant immediately prior to such record date and with an
exercise price equal to the amount by which the exercise price of this Warrant
was decreased with respect to the Distribution pursuant to the terms of the
immediately preceding clause (i).
(f) Certain Events. If any event occurs of the type contemplated by
the provisions of this Section 8 but not expressly provided for by such
provisions (including the granting of stock appreciation rights, phantom stock
rights or other rights with equity features), then the Company's Board of
Directors will make an appropriate adjustment in the Warrant Exercise Price and
the number of shares of Common Stock obtainable upon exercise of this Warrant so
as to protect the rights of the holders of the Second Lien Warrants; provided
that no such adjustment will increase the Warrant Exercise Price or decrease the
number of shares of Common Stock obtainable as otherwise determined pursuant to
this Section 8.
(g) Notices.
-13-
(i) Within four (4) Business Days of any adjustment of the
Warrant Exercise Price, the Company will give written notice thereof to the
holder of this Warrant, setting forth in reasonable detail, and certifying, the
calculation of such adjustment.
(ii) The Company will give written notice to the holder of this
Warrant at least ten (10) days prior to the date on which the Company closes its
books or takes a record (A) with respect to any dividend or distribution upon
the Common Stock, (B) with respect to any pro rata subscription offer to holders
of Common Stock or (C) for determining rights to vote with respect to any
Organic Change (as defined in Section 9(b)), dissolution or liquidation,
provided that such information shall be made known to the public prior to or in
conjunction with such notice being provided to such holder.
(iii) The Company will also give written notice to the holder of
this Warrant at least ten (10) days prior to the date on which any Organic
Change, dissolution or liquidation will take place, provided that such
information shall be made known to the public prior to or in conjunction with
such notice being provided to such holder.
Section 9. Purchase Rights; Reorganization, Reclassification,
Consolidation, Merger or Sale.
(a) Purchase Rights. In addition to any adjustments pursuant to
Section 8 above, if at any time the Company grants, issues or sells any Options,
Convertible Securities or rights to purchase stock, warrants, securities or
other property pro rata to the record holders of any class of its capital stock
(the "Purchase Rights"), then the holder of this Warrant will be entitled to
acquire, upon the terms applicable to such Purchase Rights, the aggregate
Purchase Rights that such holder could have acquired if such holder had held the
number of shares of Common Stock acquirable upon complete exercise of this
Warrant immediately before the date on which a record is taken for the grant,
issuance or sale of such Purchase Rights, or, if no such record is taken, the
date as of which the record holders of Common Stock are to be determined for the
grant, issue or sale of such Purchase Rights.
(b) Any recapitalization, reorganization, reclassification,
consolidation, merger, sale of all or substantially all of the Company's assets
to another Person or other transaction that is effected in such a way that
holders of Common Stock are entitled to receive (either directly or upon
subsequent liquidation) stock, securities or assets with respect to or in
exchange for Common Stock is referred to herein as an "ORGANIC CHANGE." Prior to
the consummation of any (i) sale of all or substantially all of the Company's
assets to an acquiring Person or (ii) other Organic Change following which the
Company is not a surviving entity, the Company will secure from the Person
purchasing such assets or the successor resulting from such Organic Change (in
each case, the "ACQUIRING ENTITY") a written agreement (in form and substance
satisfactory to the holders of Second Lien Warrants representing at least
two-thirds (2/3) of the shares of Common Stock obtainable upon exercise of the
Second Lien Warrants then outstanding) to deliver to each holder of Second Lien
Warrants in exchange for each such Second Lien Warrant, a security of the
Acquiring Entity evidenced by a written instrument substantially similar in form
and substance to this Warrant and satisfactory to the holders of such Second
Lien Warrant (including, an adjusted warrant exercise price equal to the value
for the Common Stock reflected by the terms of such consolidation, merger or
sale, and exercisable for
-14-
a corresponding number of shares of Common Stock acquirable and receivable upon
exercise of such Second Lien Warrant (without regard to any limitations on
exercises), if the value so reflected is less than the Warrant Exercise Price in
effect immediately prior to such consolidation, merger or sale). Prior to the
consummation of any other Organic Change, the Company shall make appropriate
provision (in form and substance satisfactory to the holders of such Second Lien
Warrants representing at least two-thirds (2/3) of the shares of Common Stock
obtainable upon exercise of the Second Lien Warrants then outstanding) to ensure
that each of the holders of the Second Lien Warrants will thereafter have the
right to acquire and receive in lieu of or in addition to (as the case may be)
the shares of Common Stock immediately theretofore acquirable and receivable
upon the exercise of such holder's Second Lien Warrants (without regard to any
limitations on exercises), such shares of stock, securities or assets that would
have been issued or payable in such Organic Change with respect to or in
exchange for the number of shares of Common Stock that would have been
acquirable and receivable upon the exercise of such holder's Warrant as of the
date of such Organic Change (without taking into account any limitations or
restrictions on the exerciseability of this Warrant).
Section 10. Lost, Stolen, Mutilated or Destroyed Warrant. If this Warrant
is lost, stolen, mutilated or destroyed, the Company shall promptly, on receipt
of an indemnification undertaking by the holder (or in the case of a mutilated
Warrant, the Warrant), issue a new Warrant of like denomination and tenor as
this Warrant so lost, stolen, mutilated or destroyed.
Section 11. Notice. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Warrant must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent by facsimile (provided
confirmation of transmission is mechanically or electronically generated and
kept on file by the sending party); or (iii) one (1) Business Day after deposit
with a nationally recognized overnight delivery service, in each case properly
addressed to the party to receive the same. The addresses and facsimile numbers
for such communications shall be:
If to the Company:
TRM Corporation
1521 Locust Street, Second Floor
Philadelphia, PA 19102
Telephone: (215) 832-0074
Facsimile: (215) 832-0078
Attention: President & CEO, with copy to General Counsel
With copy to:
Ledgewood, P.C.
1900 Market Street, Suite 750
Philadelphia, PA 19103
Telephone: (215) 731-9450
Facsimile: (215) 735-2513
Attention: J. Baur Whittlesey
-15-
If to a holder of this Warrant, to it at the address and facsimile number set
forth on the Schedule of Buyers to the Amended Second Lien Loan Agreement, with
copies to such holder's representatives as set forth on such Schedule of Buyers,
or, in the case of the holder or any other Person named above, at such other
address and/or facsimile number and/or to the attention of such other person as
the recipient party has specified by written notice to the other party at least
five (5) days prior to the effectiveness of such change. Written confirmation of
receipt (A) given by the recipient of such notice, consent, waiver or other
communication, (B) mechanically or electronically generated by the sender's
facsimile machine containing the time, date, recipient facsimile number and an
image of the first page of such transmission or (C) provided by a nationally
recognized overnight delivery service shall be rebuttable evidence of personal
service, receipt by facsimile or deposit with a nationally recognized overnight
delivery service in accordance with clause (i), (ii) or (iii) above,
respectively.
Section 12. Limitation on Number of Warrant Shares. The Company shall not
be obligated to issue any Warrant Shares upon exercise of the Second Lien
Warrants if the issuance of such shares of Common Stock would exceed that number
of Warrant Shares which the Company may issue upon exercise of the Second Lien
Warrants (the "EXCHANGE CAP") without breaching the Company's obligations under
the rules or regulations of the Principal Market, except that such limitation
shall not apply in the event that the Company obtains a written opinion from
outside counsel to the Company that approval of the Company's shareholders is
not required under the applicable rules of the Principal Market, which opinion
shall be reasonably satisfactory to the holders representing at least two-thirds
(2/3) of the Warrant Shares then issuable upon exercise of outstanding Second
Lien Warrants. Until Shareholder Approval (as defined in the Amended Second Lien
Loan Agreement) or such written opinion is obtained, no holder of Second Lien
Warrants shall be issued, upon exercise of the Second Lien Warrants, Warrant
Shares in an amount greater than such holder's Warrant Allocation Percentage (as
defined in the Amended Second Lien Loan Agreement). In the event that any holder
of Second Lien Warrants shall sell or otherwise transfer any of such Second Lien
Warrants, the transferee shall be allocated a pro rata portion of such holder's
Cap Allocation Amount In the event that, after the Closing Date (as defined in
the Amended Second Lien Loan Agreement), any holder of the Second Lien Warrants
shall exercise all of such holder's Second Lien Warrants into a number of shares
of Common Stock which, in the aggregate, is less than such holder's Allocation
Percentage, then the difference between such holder's Warrant Allocation
Percentage and the number of Warrant Shares actually issued to such holder shall
be allocated to the respective Warrant Allocation Percentage of the remaining
holders of Second Lien Warrants on a pro rata basis in proportion to the Warrant
Shares issuable upon exercise of the Second Lien Warrants then held by each such
holder.
Section 13. Date. The date of this Warrant is November 20, 2006 (the
"WARRANT DATE"). This Warrant, in all events, shall be wholly void and of no
effect after 11:59 P.M., New York Time, on the Expiration Date, except that
notwithstanding any other provisions hereof, the provisions of Section 7 shall
continue in full force and effect after such date as to any Warrant Shares or
other securities issued upon the exercise of this Warrant.
Section 14. Amendment and Waiver. Except as otherwise provided herein, the
provisions of the Second Lien Warrants may be amended and the Company may take
any action
-16-
herein prohibited, or omit to perform any act herein required to be performed by
it, only if the Company has obtained the written consent of the holders of
Second Lien Warrants representing at least two-thirds (2/3) of the shares of
Common Stock obtainable upon exercise of the Second Lien Warrants then
outstanding; provided that no such action may increase the Warrant Exercise
Price of any Second Lien Warrant or decrease the number of shares or change the
class of stock obtainable upon exercise of any Second Lien Warrant without the
written consent of the holder of such Second Lien Warrant.
Section 15. Descriptive Headings; Governing Law. The descriptive headings
of the several sections and paragraphs of this Warrant are inserted for
convenience only and do not constitute a part of this Warrant. All questions
concerning the construction, validity, enforcement and interpretation of this
Warrant shall be governed by the internal laws of the State of New York, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of New York or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of New York.
Section 16. Rules of Construction. Unless the context otherwise requires,
(a) all references to Sections, Schedules or Exhibits are to Sections, Schedules
or Exhibits contained in or attached to this Warrant, (b) each accounting term
not otherwise defined in this Warrant has the meaning assigned to it in
accordance with GAAP, (c) words in the singular or plural include the singular
and plural and pronouns stated in either the masculine, the feminine or neuter
gender shall include the masculine, feminine and neuter and (d) the use of the
word "including" in this Warrant shall be by way of example rather than
limitation.
* * * * * *
-17-
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
as of the 20th day of November, 2006.
TRM CORPORATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
-18-
EXHIBIT A TO WARRANT
EXERCISE NOTICE
TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS WARRANT
TRM CORPORATION
The undersigned holder hereby exercises the right to purchase
_________________ of the shares of Common Stock ("WARRANT SHARES") of TRM
Corporation, an Oregon corporation (the "COMPANY"), evidenced by the attached
Warrant (the "WARRANT"). Capitalized terms used herein and not otherwise defined
shall have the respective meanings set forth in the Warrant.
1. Form of Warrant Exercise Price. The holder intends that payment of the
Warrant Exercise Price shall be made as:
[ ] a "CASH EXERCISE" with respect to ___________________ Warrant
Shares; and/or
[ ] a "CASHLESS EXERCISE" with respect to ______________ Warrant
Shares (to the extent permitted by the terms of the Warrant).
2. Payment of Warrant Exercise Price. In the event that the holder has
elected a Cash Exercise with respect to some or all of the Warrant Shares to be
issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the
sum of $___________________ to the Company in accordance with the terms of the
Warrant.
3. Delivery of Warrant Shares. The Company shall deliver __________ Warrant
Shares in accordance with the terms of the Warrant in the following name and to
the following address:
Issue to: ______________________________________________________________________
Facsimile Number: ____________________________________________________
Account Number (if electronic book entry transfer): __________________
Date: _______________ __, ______
Name of Registered Holder
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
-19-
ACKNOWLEDGMENT
The Company hereby acknowledges this Exercise Notice and hereby directs
[TRANSFER AGENT] to issue the above indicated number of shares of Common Stock
in accordance with the Transfer Agent Instructions dated ________________, 200_
from the Company and acknowledged and agreed to by [TRANSFER AGENT].
TRM CORPORATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
-20-
EXHIBIT B TO WARRANT
FORM OF WARRANT POWER
FOR VALUE RECEIVED, the undersigned does hereby assign and transfer to
________________, Federal Identification No. __________, a warrant to purchase
____________ shares of the capital stock of TRM Corporation, an Oregon
corporation, represented by warrant certificate no. _____, standing in the name
of the undersigned on the books of said corporation. The undersigned does hereby
irrevocably constitute and appoint ______________, attorney to transfer the
warrants of said corporation, with full power of substitution in the premises.
Dated: , 200
--------- -
----------------------------------------
Name:
----------------------------------
Title:
---------------------------------
-21-