exv10w6xay







Exhibit 10.6(a)




AMENDMENT NUMBER 1

TO THE

EMPLOYMENT AGREEMENT

BETWEEN RICHARD B. STERN

AND TRM CORPORATION



WHEREAS, TRM Corporation (“TRM” or the “Company”) entered into an Employment Agreement (the
“Agreement”) with Richard B. Stern (the “Employee”) effective as of May 21, 2007, with an internal
commencement date of October 1, 2006; and



WHEREAS, the parties acknowledge that Section 409A of the Internal Revenue Code (the “Code”), as
enacted under the American Jobs Creation of 2004 (“AJCA”), made certain changes with regard to the
manner in which certain forms of nonqualified deferred compensation may be paid to employees and
consultants, including the payment of severance benefits, continuation of COBRA benefits and other
benefit payments; and



WHEREAS, the parties also acknowledge that if the provisions of Section 409A are not satisfied, the
Employee may be subject to adverse tax consequences including immediate taxation, a 20% excise tax
and underpayment of interest penalties; and



WHEREAS, the parties have operated in good faith compliance with Section 409A since it became
effective on May 21, 2007, with an internal commencement date of October 1, 2006; and



WHEREAS, the parties wish to amend the Agreement effective as of December 1, 2008.



NOW, THEREFORE, TRM and the Employee hereby agree to amend the Agreement as follows:





	1.	 	Severance Benefits.






	 	a.	 	Lump Sum Payments. Notwithstanding any provisions in the Agreement
to the contrary, all severance benefits will be paid in a single lump sum cash payment
within 30 days after execution of a Severance Agreement and General Release (a
“Release”), and the expiration of any revocation period. In no event will the
severance benefit be paid more than 21/2 months after the end of the calendar year in
which a Separation from Service occurs, provided the Employee executes and returns the
Release within the applicable time limitations contained in the Agreement, this
Amendment or any Release, without revocation of the Release.
	 
	 	 	 	If the period during which the Employee has discretion to consider and revoke the
Release straddles two taxable years of the Employee, then the Company shall make
the payments to which the Employee is entitled under Section 1(a) in the second of
such taxable years, regardless of the taxable year during which the Employee
actually delivers the executed Release to the Company.
	 
	 	b.	 	COBRA Benefits. The Company has agreed to continue to pay for
medical and dental coverage for a period of 2 years following a Separation from
Service. The Company agrees to subsidize 100% of the cost of COBRA coverage for 18
months. Thereafter, to the extent necessary, the Company will pay for individual
policies to satisfy any of its obligations under the Agreement. The payment for such
policies shall be made as of the first day of each month, which shall be deemed to be
fixed payment dates under Section 409A of the Code.





     At the end of the period in which the Company is paying all or a portion of the cost of COBRA
benefits, the Employee may continue COBRA benefits for the full period in which COBRA rights exist
for the Employee, and any dependents, including the extension of COBRA coverage for any subsequent
events.




	2.	 	Good Reason Termination. The Agreement permits the Employee to terminate employment
for Constructive Dismissal, which is generally defined to include events referred to as “Good
Reason” under Section 409A, including relocation in excess of 50 miles from Philadelphia, PA,
any material reduction, executive’s title, reporting relationship, responsibility of
authority, material reduction in the Employee’s Base Compensation (unless similar to
reductions made for other executive), a Change in Control followed by a reduction in Base
Compensation and any material breach by the Company or its obligations to the Employee that
they are not cured within 30 days after written notice.




 









 










The parties hereby agree that the following provisions will apply to permit the Employee to
terminate employment for “Good Reason” under the terms of the Employment Agreement:





	 	a.	 	The Employee may terminate employment for “Good Reason”, which is defined to
include the events identified above, as clarified in the Agreement.
	 
	 	b.	 	The Employee’s Separation from Service will be “treated” as an involuntary
termination if the following “safe harbor” rules are satisfied:






	 	i.	 	The Employee must provide notice of the existence of the
Good Reason condition within a period not to exceed 30 days of its initial
existence.
	 
	 	ii.	 	The Company will be provided a period of 30 days during
which it may remedy the condition entitling the Employee to terminate
employment for Good Reason.
	 
	 	iii.	 	The Employee must Separate from Service within a limited
period of time, not to exceed 60 days following the reason for the Good
Reason termination.
	 
	 	iv.	 	The amount, time and form of payment upon a voluntary
Separation from Service for Good Reason must be identical to the amount, time
and form of payment upon an involuntary termination under the Agreement.






	3.	 	Section 409A Compliance for Benefit Payments. The parties acknowledge that the
payment of some or all of the above severance benefits may be considered to be a form of
nonqualified deferred compensation benefits subject to Section 409A of the Code. In
recognition of this fact, the parties hereby agree and confirm as follows:






	 	a.	 	Notwithstanding any provisions of this Release to the contrary, in no event
will any cash severance benefits be paid, or commence to be paid for any periodic
payments, more than 21/2 months after the end of the calendar year in which a Separation
from Service occurs.
	 
	 	b.	 	The parties acknowledge that the continuation of benefits under COBRA and
other benefits will be incurred and paid by the December 31 of the second calendar
year following the calendar year in which a Separation from Service occurs.
	 
	 	c.	 	Continuation of benefits any other benefits must generally be incurred and
paid by December 31 of the second calendar year following the calendar year in which a
Separation from Service occurs to comply with Section 409A of the Code.






	4.	 	Payment. Whenever a payment under the Agreement, this Amendment or any Release
specifies a payment period with reference to a number of days (e.g., “payment will be
made within 30 days after a Separation from Service”), the actual date of payment within the
specified period will be within the sole discretion of the Company.






	5.	 	Section 409A Compliance. It is intended that the Agreement and this Amendment will
comply with Section 409A of the Code (and any regulations and guidelines issued thereunder) to
the extent the Agreement is subject thereto, and the Agreement will be interpreted on a basis
consistent with such intent.  If any additional amendments to the Agreement are necessary for
the Agreement to comply with Section 409A, the parties will negotiate in good faith to amend
the Agreement in a manner that preserves the original intent of the parties to the extent
reasonably possible.  No action or failure to act, pursuant to this Section 5, will subject
the Company to any claim, liability, or expense, and the Company will not have any obligation
to indemnify or otherwise protect the Employee from the obligation to pay any taxes pursuant
to Section 409A of the Code.
	 
	 	 	For all purposes under this Agreement, reference to the Employee’s “Termination of
Employment” (and corollary terms) with the Company will be construed to refer to a
“Separation from Service” (as determined under Treas. Reg. Section 1.409A-1(h), as
uniformly applied by the Company) with the Company.
	 
	 	 	With regard to any provision herein that provides for reimbursement of costs and expenses
or in-kind benefits, except as permitted by Section 409A of the Code: (i) the right to
reimbursement or in-kind benefits





 









 











	 	 	will not be subject to liquidation or exchange for another benefit; (ii) the amount of
expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year
will not affect the expenses eligible for reimbursement, or in-kind benefits to be
provided, in any other taxable year, provided that the foregoing clause; (ii) will not be
violated without regard to expenses reimbursed under any arrangement covered by Section
105(b) of the Code solely because such expenses are subject to a limit related to the
period the arrangement is in effect; and (iii) such payments will be made on or before the
last day of the Employee’s taxable year following the taxable year in which the expense was
incurred.






	6.	 	Delay in Payment For Specified Employees.






	 	a.	 	Delay in Payment for Specified Employees. To the extent that any
Employee is determined to be a Specified Employee of the Company or any Related
Entity, in no event will any of the above severance benefits be made within 6 months
after the Employee’s Separation from Service, except as permitted below. Any and all
payments that are not permitted to be made within such 6 month period will be delayed
until the 15th day of the 7th month after a Separation from
Service occurs and will retroactively be paid to make the Employee whole for any lost
benefits. All delayed payments will be made after the expiration of the 6 month
period, with interest at a rate equal to the prime rate as determined as of the first
day of the month after a Separation from Service occurs, plus 2%.
	 
	 	b.	 	Exception for Specified Employees. Notwithstanding any provision in
the Agreement or this Amendment to the contrary, in accordance with the Final
Regulations issued under Section 409A of the Code, to the extent that the severance
benefits to a Specified Employee do not exceed the lesser of the Specified Employee
salary for the past 2 years or the Section 401(a)(17) compensation limitations
(i.e., $230,000 in 2008 and $245,000 in 2009), such amount will be paid within
the 6 month period of time during which benefits may generally not be paid to
Specified Employees. To the extent benefits exceed such limitations (which is a
maximum of $460,000 in 2008 and $490,000 in 2009), the balance of any payments will be
made following the expiration of the 6 month period following a Separation of Service
in a single lump sum payment on the 15th day of the 7th month
following a Separation from Service, with interest as specified in Section 6(a) above,
for the delay in making payments.






	7.	 	General Definitions.






	 	a.	 	“Disability” means an Employee is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment, which can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months, as determined by an independent third
party physician, selected within the discretion of the Company. The determination of
whether an Employee is Disabled will be determined by the Company, in its sole
discretion, but subject to the provisions of Section 409A.
	 
	 	b.	 	“Key Employee” means an employee as described in Section 416(i) of
the Code, determined without regard to Section 416(i)(5) thereof. For purposes of
this provision, a Key Employee is an officer earning more than $150,000 in 2008 and
$160,000 in 2009, (with a limit of no more than 50 employees, or if less, the greater
of 3 or 10% of all employees being treated as officers); a 5% owner; or a 1% owner
having annual compensation of more than $150,000. All amounts will automatically be
increased as provided under the Code for cost of living or other changes.
	 
	 	c.	 	“Separation from Service” means an Employee is no longer employed by
the Company on account of a Separation from Service, retirement, disability or death.
Consistent with the Final Treasury Regulation, or any subsequent guidance under
Section 409A of the Code, no Separation from Service will occur if an Employee
continues to perform services as a consultant or an employee in excess of any amount
of time permitted under such guidance.






	 	i.	 	Leave of Absence. For purposes of Section 409A, the
employment relationship is treated as continuing in effect while an Employee
is on military leave, sick leave, or other bona fide leave of absence, as long
as the period of leave does not exceed 6 months, or if longer, as long as an
Employee’s right to reemployment with the Company is provided either by
statute or contract. Otherwise, after a 6 month leave of absence, the
employment relationship if deemed terminated.




 









 












	 	ii.	 	Part-Time Status. Whether or not a termination of
employment occurs is determined based upon all facts and circumstances.
However, in the event that services provided by an Employee are insignificant,
a Separation from Service will be deemed to have occurred. For purposes of
Section 409A, if an Employee is providing services to the Company at a rate
that is at least equal to 20% of the services rendered, on average, during the
immediately preceding 3 full calendar years of employment (or such lesser
period), and the annual compensation for such services is at least 20% of the
average annual compensation earned during the final 3 full calendar years of
employment (or such lesser period), no termination will be deemed to have
occurred since such services are not insignificant.
	 
	 	iii.	 	Consulting Services. Where an Employee continues to
provide services to the Company or any Related Entities in a capacity other
than as an employee, a Separation from Service will not be deemed to have
occurred if an Employee is providing services at an annual rate that is 50% or
more of the services rendered, on average, during the immediately preceding 3
full calendar years of employment (or such lesser period) and the annual
remuneration for such services is 50% or more of the annual remuneration
earned during the final 3 full calendar years of employment (or such lesser
period).






	 	d.	 	“Specified Employee” means a Key Employee who is employed by any
employer which has its stock publicly traded on an established securities market. For
purposes of the Agreement, the “Specified Employee Identification Date” will be each
December 31, and the “Specified Employee Effective Date” will be the following April
1. Specified Employees will be determined by the Company on an annual basis for
purposes of all nonqualified deferred compensation plans and any other programs in
accordance with the provisions of Section 409A of the Code.






	8.	 	Consequences of Violating Section 409A. The Employee will be informed that in the
event of any violation of Section 409A of the Code, severance and other payments may be
subject to income taxes, a 20% excise tax, and underpayment of interest penalties. However,
the Agreement and this Amendment are intended to comply with Section 409A and will be
interpreted consistent with the provisions of Section 409A.
	 
	9.	 	General Release. The terms of the Agreement require the Employee to execute a
Release, as a condition precedent to the payment of severance benefits. In order to avoid
negotiation of a Release at the time of any Separation from Service, the parties agree to
abide by the terms of the Release, as attached hereto this Amendment in substitution for the
Release attached to the Agreement, for purposes of any future terminations.
	 
	10.	 	Withholding of Taxes. The Company will deduct from all severance payments made to
any Employee all applicable federal, state or local taxes required by law to be withheld from
such payments.
	 
	11.	 	No Other Changes. No provisions of this Amendment Number 1 will otherwise change the
obligations of the parties under the Agreement, and all other provisions of the Agreement will
continue to apply. The sole purpose of this Amendment is to confirm that all payments will
satisfy Section 409A of the Code, and to avoid any adverse tax consequences to the Employee.




IN WITNESS WHEREOF, the parties have hereto executed this Amendment effective as of December 1,
2008.




	 	 	 	 	 	 	 	 	 
	 	 	 	 	TRM CORPORATION	 	 
	 
	 	 	 	 	 	 	 	 
	Date:

	 	January 25, 2009
	 	BY:
	 	/s/ Thomas S. McNamara
 

	 	 
	 

	 	 	 	 	 	Thomas S. McNamara

Chairman, Compensation Committee

TRM Corporation Board of Directors	 	 
	 
	 	 	 	 	 	 	 	 
	Date:

	 	December 30, 2008
	 	 	 	/s/ Richard B. Stern	 	 
	 	 	 	 	 	 	 
	 	 	 	 	Richard B. Stern