UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION





Washington,
D.C. 20549





FORM
10-Q





x  QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES
EXCHANGE ACT OF 1934





For the
quarterly period ended March 31, 2010





 ̈  TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES
EXCHANGE ACT OF 1934





For the
transition period
from           
to





Commission
file number       0-19657




ACCESS TO MONEY, INC.(Exact
      name of registrant as specified in its
charter)





Delaware
                  
                  93-0809419(State
      or other jurisdiction of incorporation or organization)
                  
                  (I.R.S.
      Employer Identification
No.)




1101
Kings Highway N, Suite G100
 Cherry Hill, New Jersey(Address
      of principal executive offices) (Zip
Code)
 
 (856) 414-9100(Registrant’s
      telephone number, including area
code)


Indicate by check mark whether the
registrant: (1) has filed all reports required to be filed by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days).   YESxNO ̈





Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, if
any, every Interactive Data File required to be submitted and posted pursuant to
Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12
months (or for such shorter period that the registrant was required to submit
and post such files).     YES o NO  ̈





Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company.  See the definitions of "large
accelerated filer," "accelerated filer" and "smaller reporting company" in Rule
12b-2 of the Exchange Act.





Large
      accelerated filer
             ̈
            Accelerated
      filer
             ̈Non-accelerated
      filer
             ̈
            Smaller
      reporting company
            x(Do
      not check if a smaller reporting company)





Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES  ̈
NO  x





Indicate the number of shares
outstanding of each of the issuer’s classes of common stock, as of the latest
practicable date:  22,310,624 shares of common stock outstanding at
May 12, 2010.





TABLE
      OF CONTENTS
                        Page No.PART
      I
                        FINANCIAL
      INFORMATIONITEM 1.
                        FINANCIAL STATEMENTS
                        2ITEM 2.
                        MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
      CONDITION AND RESULTS OF OPERATIONS
                        14ITEM 4T.
                        CONTROLS AND PROCEDURES
                        22PART
      II
                        OTHER
      INFORMATIONITEM 6.
                        EXHIBITS
                        23





PART
I - FINANCIAL INFORMATION





ITEM
1. FINANCIAL
STATEMENTS.





Access
to Money, Inc.


Condensed
Consolidated Balance Sheets


(Unaudited)


(In
thousands)




March 31,
                      2010
                    
                    
                    December 31,
                      2009AssetsCurrent
      assets:Cash
                    
                    $
                    5,869
                    
                    
                    $
                    5,770Restricted cash
                    
                    
                    800
                    
                    
                    
                    800Accounts receivable,
      net
                    
                    
                    3,678
                    
                    
                    
                    2,494Leases receivable,
      net
                    
                    
                    70
                    
                    
                    
                    109Inventories
                    
                    
                    990
                    
                    
                    
                    767Prepaid expenses and
      other
                    
                    
                    353
                    
                    
                    
                    289Deferred financing
      costs
                    
                    
                    259
                    
                    
                    
                    259Total current
      assets
                    
                    
                    12,019
                    
                    
                    
                    10,488Property
      and equipment, net
                    
                    
                    2,983
                    
                    
                    
                    3,220Intangible
      assets, net
                    
                    
                    1,606
                    
                    
                    
                    1,711Goodwill
                    
                    
                    10,559
                    
                    
                    
                    10,559Deferred
      financing costs, long term
                    
                    
                    13
                    
                    
                    
                    78Other
      assets
                    
                    
                    252
                    
                    
                    
                    319Total
      assets
                    
                    $
                    27,432
                    
                    
                    $
                    26,375Liabilities
      and Shareholders’ DeficitCurrent
      liabilities:Accounts
payable
                    
                    $
                    7,183
                    
                    
                    $
                    5,639Accrued
expenses
                    
                    
                    6,105
                    
                    
                    
                    5,691Term loans
                    
                    
                    308
                    
                    
                    
                    1,092Total current
      liabilities
                    
                    
                    13,596
                    
                    
                    
                    12,422Term
      loans and other debt
                    
                    
                    18,816
                    
                    
                    
                    18,406Warrants
                    
                    
                    6,886
                    
                    
                    
                    6,747Total
      liabilities
                    
                    
                    39,298
                    
                    
                    
                    37,575Shareholders’
      deficit:Common
      stock, $0.001 par value -
                      70,000
      shares authorized; 22,086 shares issued and outstanding
                    
                    
                    135,941
                    
                    
                    
                    135,891Preferred
      stock -
                      5,000
      shares authorized; none issued and outstanding
                    
                    
                    -
                    
                    
                    
                    -Additional paid-in
      capital
                    
                    
                    63
                    
                    
                    
                    63Accumulated
    deficit
                    
                    
                    (147,870
                    )
                    
                    
                    (147,154
                    )Total shareholders’
      deficit
                    
                    
                    (11,866
                    )
                    
                    
                    (11,200
                    )Total
      liabilities and shareholders’ deficit
                    
                    $
                    27,432
                    
                    
                    $
                    26,375





See
accompanying notes to condensed consolidated financial
statements.


2


Access
to Money, Inc.


Condensed
Consolidated Statements of Operations


Three
months ended March 31, 2010 and 2009


(Unaudited)


(In
thousands, except per share data)





2010
                
                
                2009Sales
                
                $
                22,203
                
                
                $
                22,245Commissions
                
                
                14,572
                
                
                
                14,981Net
      sales
                
                
                7,631
                
                
                
                7,264Cost
      of sales
                
                
                4,318
                
                
                
                3,607Gross
      profit
                
                
                3,313
                
                
                
                3,657Selling,
      general and administrative expense
                
                
                2,585
                
                
                
                2,810Operating
      income
                
                
                728
                
                
                
                847Interest
      expense
                
                
                757
                
                
                
                734Amortization
      of debt issuance costs
                
                
                559
                
                
                
                554Other
      expense (income)
                
                
                (18
                )
                
                
                (7
                )Loss
      on asset disposal
                
                
                7
                
                
                
                41Change
      in fair value of warrants
                
                
                139
                
                
                
                122Net
      loss before income taxes
                
                
                (716
                )
                
                
                (597
                )Provision
      (benefit) for income taxes
                
                
                -
                
                
                
                -Net
      loss
                
                $
                (716
                )
                
                $
                (597
                )Weighted
      average common shares outstanding
                
                
                22,086
                
                
                
                21,486Basic
      and diluted loss per share:
                
                $
                (.03
                )
                
                $
                (.03
                )





See
accompanying notes to condensed consolidated financial
statements.


3





Access
to Money, Inc.


Condensed
Consolidated Statement of Shareholders’ Deficit


Three
months ended March 31, 2010


(Unaudited)


(In
thousands)





Common
                  
                  
                  Additional paid-in
                  
                  
                  Retained
                    earnings
                    (accumulatedShares
                  
                  
                  Amounts
                  
                  
                  capital
                  
                  
                  deficit)
                  
                  
                  TotalBalances,
      December 31, 2009
                  
                  
                  22,086
                  
                  
                  $
                  135,891
                  
                  
                  $
                  63
                  
                  
                  $
                  (147,154
                  )
                  
                  $
                  (11,200
                  )Net
      loss
                  
                  
                  
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (716
                  )
                  
                  
                  (716
                  )Share-based
      compensation
                  
                  
                  
                  
                  
                  
                  50
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  50Balances,
      March 31, 2010
                  
                  
                  22,086
                  
                  
                  $
                  135,941
                  
                  
                  $
                  63
                  
                  
                  $
                  (147,870
                  )
                  
                  $
                  (11,866
                  )





See
accompanying notes to condensed consolidated financial
statements.


4


Access
to Money, Inc.


Condensed
Consolidated Statements of Cash Flows


Three
months ended March 31, 2010 and 2009


(Unaudited)


(In
thousands)





2010
                
                
                2009Cash
      flows from operating activities:Net
      loss
                
                $
                (716
                )
                
                $
                (597
                )Adjustments
      to reconcile net loss to net cash provided by operating
      activities:Depreciation and
      amortization
                
                
                1,053
                
                
                
                979Non-cash share-based
      compensation
                
                
                50
                
                
                
                27Loss on disposal or retirement
      of equipment
                
                
                7
                
                
                
                41Provision for doubtful
      accounts
                
                
                38
                
                
                
                37Change in warrant
      value
                
                
                139
                
                
                
                122Changes in assets and
      liabilities, net of acquisitionsRestricted cash
                
                
                -
                
                
                
                1,200Accounts
    receivable
                
                
                (1,222
                )
                
                
                (127
                )Lease
receivable
                
                
                39Inventories
                
                
                (223
                )
                
                
                (234
                )Prepaid expenses and
      other
                
                
                (64
                )
                
                
                17Accounts
payable
                
                
                1,545
                
                
                
                947Accrued
expenses
                
                
                414
                
                
                
                (78
                )Cash provided by operating
      activities
                
                
                1,060
                
                
                
                2,334Cash
      flows from investing activities:Capital
      expenditures
                
                
                (92
                )
                
                
                (406
                )Proceeds
      from sale of equipment
                
                
                -
                
                
                
                1Acquisition
      of intangible and other assets
                
                
                -
                
                
                
                16Cash (used in) investing
      activities
                
                
                (92
                )
                
                
                (389
                )Cash
      flows from financing activities:Payment
      on term loans
                
                
                (869
                )
                
                
                (255
                )Cash (used in) financing
      activities
                
                
                (869
                )
                
                
                (255
                )Net
      increase in cash and cash equivalents
                
                
                99
                
                
                
                1,690Beginning
      cash and cash equivalents
                
                
                5,770
                
                
                
                4,535Ending
      cash and cash equivalents
                
                $
                5,869
                
                
                $
                6,225Supplemental
      cash flow information:Cash paid for
    interest
                
                $
                64
                
                
                $
                13





See
accompanying notes to condensed consolidated financial
statements.


5


ACCESS
TO MONEY, INC.


Notes
to Condensed Consolidated Financial Statements


(Unaudited)





1.
            BASIS OF
      PRESENTATION





The accompanying unaudited condensed
consolidated financial statements of Access to Money, Inc. and its subsidiaries
have been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission (the "SEC") for interim financial statements, and reflect
all adjustments, consisting only of normal recurring adjustments, which, in the
opinion of management, are necessary for a fair statement of the results of the
interim periods.  These condensed consolidated financial statements
should be read in conjunction with our annual report on Form 10-K for the year
ended December 31, 2009.  Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles in the United States of America
have been condensed or omitted pursuant to such rules and regulations. The
results of operations for the periods presented are not necessarily indicative
of the results to be expected for any subsequent interim period or for the year
ending December 31, 2010.





2.
            DESCRIPTION OF BUSINESS AND
      SUMMARY OF SIGNIFICANT ACCOUNTING
  POLICIES





Description of
Business





We are an independent sales
organization, or ISO, servicing businesses in the operation of automated teller
machines, or ATMs.  We entered the ATM business in 1999 and expanded
operations through both internal growth and acquisitions from 1999 to
2008.  In June 2009, we merged TRM Corporation into Access to Money,
Inc., a Delaware corporation, for purposes of changing our state of
incorporation and our name to Access to Money, Inc.  At March 31,
2010, we had approximately 12,000 ATMs under contract.





Principles of
Consolidation





The condensed consolidated financial
statements include the accounts of Access to Money, Inc. and its
subsidiaries.  Our subsidiaries at March 31, 2010 consisted of
TRM Copy Centers (USA) Corporation, TRM (Canada) Corporation, TRM ATM
Corporation, TRM ATM Acquisition Corporation, Access Cash International LLC,
Access to Money-SL, LJR Consulting Corp., and FPC France Ltd.





Use of
Estimates





The preparation of our financial
statements requires us to make estimates and judgments that affect the reported
amounts of our assets, liabilities, sales, costs and expenses, and the
disclosure of contingent assets and liabilities.  On an on-going
basis, we evaluate our estimates and judgments, including those related to
impairments, depreciation, intangible assets, accounts receivable, inventories,
and income taxes.  We base our estimates and judgments on historical
experience and on various assumptions that we believe are reasonable under the
circumstances, the results of which form the basis for making judgments about
the carrying values of assets and liabilities that are not readily apparent from
other sources.  Actual results may differ from these estimates under
different assumptions or conditions.


6





Fair Value
Measurements





We measure and disclose the estimated
fair value of financial assets and liabilities utilizing a hierarchy of
valuation techniques based on whether the inputs to a fair value measurement are
considered to be observable or unobservable in a
marketplace.  Observable inputs reflect market data obtained from
independent sources, while unobservable inputs reflect our market
assumptions.  This hierarchy requires the use of observable market
data when available.  These inputs have created the following fair
value hierarchy:





·
            Level 1- quoted prices
      for identicalinstruments in active
markets;


·
            Level2 - quoted prices
      for similarinstruments in active markets; quoted prices for identical or
      similar instruments in markets that are not active; and model-derived
      valuations in which significant inputs and significant value drivers are
      observable in active markets; and


·
            Level3 - fair value
      measurements derived from valuation techniques in which one or more
      significant inputs or significant value drivers are unobservable.





If quoted market prices or inputs are
not available, fair value measurements are based upon valuation models that
utilize current market or independently sourced market inputs, such as interest
rates, option volatilities, credit spreads, market capitalization rates,
etc.  Items valued using such internally-generated valuation
techniques are classified according to the lowest level input that is
significant to the fair value measurement.  As a result, the asset or
liability could be classified in either Level 2 or 3 even though there may be
some significant inputs that are readily observable.  Internal fair
value models and techniques we used include discounted cash flow and Black
Scholes valuation models.  We also consider our counterparty's and own
credit risk on derivatives and other liabilities measured at fair value based on
valuation technique Level 3.





Financial instruments, including cash
equivalents, accounts receivable and accounts payable approximate fair market
value because of the short maturity of these instruments.  Fair value
approximates the carrying value of our borrowings under our variable-rate
long-term debt, based upon interest rates available for the same or similar
instruments.  In 2009, the majority of our debt had fixed interest
rates and the fair value is estimated at $22.1 million using Level 3
inputs.





Restricted
Cash





At March 31, 2010 and
December 31, 2009 we had $800,000 of cash held by a bank as collateral for
a letter of credit that is classified as restricted cash on our balance
sheet.  The restricted cash pertains to a term under an agreement with
our vault cash supplier.


7





Revenue Recognition,
Discounts and Accounts Receivable





A portion or all of each ATM surcharge
is paid to retail businesses, depending upon the contract terms with
them.  We receive daily reports of ATM transactions electronically
from ATM network processors.  On a monthly basis, ATM transaction data
is used to calculate the retailer’s applicable commission, which is generally
dependent upon transaction volumes, and we generally remit the commission
directly to the retailer’s bank account through electronic funds
transfer.  We recognize ATM revenue based on the actual month
transactions reported by the ATM processing network.  Total sales
activity and commissions are reported separately in the condensed consolidated
statements of operations to arrive at net sales.





Accounts receivable are shown net of
allowance for doubtful accounts of $295,000 and $272,000 at March 31, 2010
and December 31, 2009, respectively.





Inventory





Inventory is stated at the lower of
cost (first-in, first-out method) or market.  Inventory consists
primarily of ATMs and related parts and equipment.  ATMs and parts
available for sale are classified as inventory until such time as the machine or
part is sold or installed and in service.  Once the ATM or part is
sold, it is relieved to cost of sales.





The following table summarizes
inventories (in thousands):





March 31,
                  
                  
                  December 31,2010
                  
                  
                  2009ATMs
      held for resale
                  
                  $
                  693
                  
                  
                  $
                  439Parts
                  
                  
                  297
                  
                  
                  
                  328$
                  990
                  
                  
                  $
                  767





Fixed
Assets





Fixed assets are recorded at cost plus
amounts required to place equipment in service.  Depreciation and
amortization begins when the asset is placed in service.  ATMs,
furniture and fixtures and computer equipment are generally depreciated using
the straight-line method over the estimated remaining useful lives of the
related assets.  Estimated useful lives are as follows:





ATMs
                            3-10
      yearsComputer
      equipment
                            2-5
      yearsFurniture
      and fixtures
                            5-7
      years





Upon the sale or other disposition of
an asset, cost and accumulated depreciation are removed from the accounts and
any gain or loss is reflected in gain (loss) on sale of assets.


8





Goodwill and Intangible
Assets





As of March 31, 2010 and
December 31, 2009, our assets included goodwill of $10.6 million, and
intangible assets with net carrying amounts of $1.6 million and
$1.7 million, respectively.  Goodwill is tested for impairment at
least annually and whenever a triggering event is identified that may indicate
an impairment has occurred.  Potential impairment indicators include a
significant decline in revenues or a decline in our capitalization below
carrying value.  Goodwill is tested by comparing the estimated fair
value of a reporting unit containing goodwill to its carrying
value.  If the carrying value exceeds the estimated fair value, a
second test is needed to measure the amount of potential goodwill
impairment.  The second step requires the estimated fair value of the
reporting unit to be allocated to all the assets and liabilities of the
reporting unit as if it had been acquired in a business combination at the date
of the impairment test.  The excess estimated fair value of the
reporting unit over the estimated fair value of assets and liabilities is the
implied value of goodwill and is used to determine the amount of
impairment.  We perform an annual impairment test as of November 30
each fiscal year.





Since December 31, 2009 there have
been no indicators of impairment.





The following table summarizes Goodwill
and Intangible Assets at March 31, 2010 (in thousands):




Gross Carrying
                  
                  
                  AccumulatedValue
                  
                  
                  Amortization
                  
                  
                  NetGoodwill
                  
                  $
                  10,559
                  
                  
                  $
                  -
                  
                  
                  $
                  10,559Intangible
      Assets
                  
                  
                  2,446
                  
                  
                  
                  (840
                  )
                  
                  
                  1,606Total
                  
                  $
                  13,005
                  
                  
                  $
                  (840
                  )
                  
                  $
                  12,165





Income
Taxes





We account for income taxes utilizing
the asset and liability method.  Under the asset and liability method,
we determine deferred tax assets and liabilities based on differences between
the financial reporting and income tax bases of assets and liabilities, and
measure them by applying enacted tax rates and laws to the taxable years in
which such differences are expected to reverse.





Share-Based
Compensation





Share-based compensation is measured as
the fair value of the award at its grant date based on the estimated number of
awards that are expected to vest, and recorded over the applicable service
period.  In the absence of an observable market price for a
share-based award, the fair value is based upon a valuation methodology that
takes into consideration various factors, including the exercise price of the
award, the expected term of the award, the current price of the underlying
shares, the expected volatility of the underlying share price, the expected
dividends on the underlying shares and the risk-free interest
rate.  Compensation expense has been recognized based on the estimated
grant date fair value method using the Black-Scholes valuation
model.


9





Warrants





Effective January 1, 2009, we
adopted new accounting guidance that can affect the accounting for warrants and
many convertible instruments with provisions that protect holders from a change
in our stock price.  Protection provisions reduce the exercise price
of a warrant or convertible instrument if a company either issues equity shares
for a price that is lower than the exercise price of those instruments or issues
new warrants or convertible instruments that have a lower exercise
price.  We evaluated and determined that outstanding warrants to
acquire stock of the Company contain provisions that protect holders from
declines in the stock price and as a result we have recognized these warrants as
a liability at their respective fair values on each reporting date.





Net Income (Loss) Per
Share





Basic earnings per share is computed
using the weighted average number of common shares outstanding during the
period.  All outstanding options and warrants were excluded from the
calculation of diluted earnings per share for 2009 and 2008 because their
inclusion would have been antidilutive.





3.           ACCRUED
AND OTHER EXPENSES





The following table summarizes accounts
payable and accrued liabilities (in thousands):.





March 31,
                    2010
                  
                  
                  December 31,
                    2009Accrued
      payroll expenses
                  
                  
                  256
                  
                  
                  
                  339Interest
      payable
                  
                  
                  3,356
                  
                  
                  
                  2,675ATM
      maintenance and other expenses
                  
                  
                  264
                  
                  
                  
                  438Other
      accrued expenses
                  
                  
                  2,220
                  
                  
                  
                  2,239$
                  6,105
                  
                  
                  $
                  5,691





4.         TERM
LOANS PAYABLE AND OTHER DEBT:





The following table summarizes term
loans and other debt (in thousands):





March 31,
                  
                  
                  December 31,2010
                  
                  
                  2009Lampe
      Loan Facility
                  
                  
                  10,000
                  
                  
                  
                  10,000Cadence
      Special Holdings II, LLC
                  
                  
                  1,000
                  
                  
                  
                  1,000Note
      payable to former owner of LJR Consulting
                  
                  
                  9,755
                  
                  
                  
                  9,755Notemachine
                  
                  
                  -
                  
                  
                  
                  324Other
      debt
                  
                  
                  446
                  
                  
                  
                  991Debt
      discount
                  
                  
                  (2,077
                  )
                  
                  
                  (2,572
                  )$
                  19,124
                  
                  
                  $
                  19,498


10


On April 18, 2008, we borrowed $11.0
million pursuant to a Securities Purchase Agreement (the "Securities Purchase
Agreement") with LC Capital Master Fund, Ltd. ("LC Capital") as lender and
Lampe, Conway & Co., LLC ("Lampe") as administrative and collateral
agent.  The $11.0 million note accrues interest at 13% per annum,
payable semiannually, is due in April 2011, and is collateralized by
substantially all of our assets and the assets of our
subsidiaries.  The Lampe Loan Facility includes covenants that require
us to maintain a certain balance of cash and investments, meet a minimum
trailing twelve-month consolidated EBITDA target of $6.0 million, and
maintain at least 10,250 transacting ATMs.





On May 30, 2008, LC Capital assigned
10% of the promissory note to Cadence Special Holdings II, LLC
("Cadence").





On April 18, 2008, as part of the
purchase price for the capital stock of LJR Consulting, we issued a note payable
in the amount of $9.8 million, to Douglas Falcone, the former owner of LJR
Consulting and current Chief Operating Officer of the Company.  The
note accrues interest at 13% per annum payable quarterly and the principal
balance is due April 18, 2015.  Payments under the promissory note are
subordinated to the payment in full of the Lampe Loan
Facility.  Payments on the note have been deferred by Douglas Falcone
and interest due is reported as interest payable under accrued expenses.





We had $446,000 and $991,000 of other
debt as of March 31, 2010 and December 31, 2009,
respectively.  The debt at December 31, 2009, included notes
payable balances due to Douglas Falcone for vault cash in connection with his
ownership of LJR Consulting, and to a bank for a lease related to a customer
project.  The balance due Douglas Falcone was repaid as we replaced
the cash in our ATMs previously funded by Douglas Falcone with cash provided by
our primary vault cash provider.  The balance as of March 31,
2010 consists of the bank note related to the customer project which is paid
monthly with an interest rate of 7.5% through August 2011, and an auto
loan.





On March 1, 2010, we made the final
payment on our note to Notemachine Limited.





5.           WARRANTS





Common Stock
Warrants





We have four warrants outstanding which
provide the holders to purchase up to an aggregate of 18.1 million shares
of common stock upon exercise.





The following tables list the warrant
holders and their grants (in thousands):





Holder
                  
                  Amount
                  
                  
                  Exercise Price
                  
                  Expiration DateLC
      Capital Master Fund, Ltd.
                  
                  
                  11,250
                  
                  
                  $
                  0.28
                  
                  April
      2015LC
      Capital Master Fund, Ltd.
                  
                  
                  2,500
                  
                  
                  $
                  0.28
                  
                  February
      2015Cadence
      Special Holdings II, LLC
                  
                  
                  1,250
                  
                  
                  $
                  0.28
                  
                  April
      2015GSO
                  
                  
                  3,072
                  
                  
                  $
                  0.28
                  
                  November
      201318,072


11





All warrants are exercisable at any
time and we have agreed to register the shares issuable upon the exercise of the
warrants.  We use a Black-Scholes valuation model to estimate the fair
value of the issued warrants.  The cost associated with the GSO
warrants was accelerated and expensed in 2008 due to the payment of the GSO
debt.  We are currently amortizing the initial value of the LC Capital
and Cadence warrants, $5.9 million, as debt issuance cost over the term of
the debt associated with those warrants.  The relative factors used in
the initial valuation of these warrants included the term of the warrant, a risk
free rate of 3.8%, and volatility percentage of 133.4.





6.           VAULT
CASH





In general, we rent vault cash under a
bailment arrangement from financial institutions and pay negotiated fees for the
use of that money when it is placed in ATMs we are responsible for supplying
cash to.  The vault cash is controlled by employees of the financial
institutions and armored car carriers who we contract with to deliver the cash
to our ATMs.  As cash withdrawals are made at the ATMs, processing
companies settle the transactions and send funds back to the financial
institutions for transactions made the previous day.  We have a
contract with the bank and armored car carriers stating that the vault cash
belongs to the bank and that neither we nor the armored car carrier has any
legal rights to the funds.





During the quarter ending
March 31, 2010, our rental fee for the use of funds was calculated using an
interest rate of 2.75% and the average monthly amount of cash used to vault our
ATMs was $45.6 million.  The cost associated with our vault cash
for the first quarter of 2010 was $513,000 and is reported in cost of
sales.





7.         SHARE-BASED
COMPENSATION





The Company calculates the fair value
of stock-based instruments awarded to employees on the date of grant and
recognizes the calculated fair value, net of estimated forfeitures, as
compensation expense over the requisite service periods of the related
awards.  The following table reflects the total share-based
compensation expense amounts included in the Company’s Condensed Consolidated
Statements of Operations for the three month period ended March 31, 2010
and 2009 (in thousands):





Three months ended March 31,2010
                  
                  
                  2009Option
      grants
                  
                  $
                  14
                  
                  
                  $
                  7Restricted
      shares
                  
                  
                  36
                  
                  
                  
                  20Total
      share-based compensation expense
                  
                  $
                  50
                  
                  
                  $
                  27


12





Options.The
following table summarizes stock option activity during the three months ended
March 31, 2010, as follows:





Number of shares
                  
                  
                  Weighted average exercise priceOptions
      Outstanding January 1, 2010
                  
                  
                  322,500
                  
                  
                  $
                  1.13Granted
                  
                  
                  -
                  
                  
                  
                  -Exercised
                  
                  
                  -
                  
                  
                  
                  -Cancelled
                  
                  
                  -
                  
                  
                  
                  -Options
      Outstanding March 31, 2010
                  
                  
                  322,500
                  
                  
                  $
                  1.13





As of March 31, 2010, options to
purchase 247,500 shares of common stock at a weighted average exercise price of
$1.39 per share were vested and exercisable.





Restricted
Stock.  The following table summarizes restricted stock
activity during the three months ended March 31, 2010, as
follows:





SharesRestricted
      shares January 1, 2010
                    
                    
                    834,995Granted
                    
                    
                    25,000Vested
                    
                    
                    -Forfeited
                    
                    
                    -Restricted
      shares March 31, 2010
                    
                    
                    859,995





8.           PROVISION
FOR INCOME TAXES





We have recorded no benefit from our
losses for the first three months of 2009 or 2010 because we are uncertain that
we will be able to realize the benefit of our net operating loss carryforwards
and future deductible amounts.  As of March 31, 2010, we have net
operating losses of approximately $61.2 million available to offset future
taxable income for United States federal income tax purposes which expire in the
years 2020 through 2028, and our Canadian subsidiary has net operating loss
carryforwards of approximately $15.0 million available to offset future taxable
income in Canada which expire in the years 2010 through
2017.  However, we have sold the assets of our Canadian subsidiary,
and it no longer has any operations.





9.           FAIR
VALUE OF FINANCIAL INSTRUMENTS





Financial instruments, including cash
and cash equivalents, accounts receivable and accounts payable approximate fair
market value because of the short maturity of these instruments.  The carry
amounts of our long-term liabilities approximate the estimated fair values at
March 31, 2010 based on our ability to acquire similar debt at similar
maturities.


13





Warrants





The table below provides a
reconciliation of the beginning and ending balances for our warrant liability
and increase in fair value using a Black-Scholes model as of March 31,
2010.





Balance
      as of January 1, 2010
                    
                    $
                    6,747Increase
      in fair value of warrants
                    
                    
                    139Balance
      as of March 31, 2010
                    
                    $
                    6,886





We determined the fair value of our
warrants using a Black-Scholes model.  The significant assumptions
considered by the model were the amounts of outstanding warrants, the remaining
term of each warrant, the per share stock price of $0.44, a risk free rate of
2.62%, and a historical volatility of 122.0%.





10.        SUBSEQUENT
EVENTS





None.





ITEM
      2.
            MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF
FINANCIAL


CONDITION
      AND RESULTS OF OPERATIONS.





Cautionary
Statements Regarding Forward-Looking Statements





This
report contains "forward-looking statements" within the meaning of Section 27A
of the Securities Act of 1933, as amended (the "Securities Act"), and Section
21E of the Securities Exchange Act of 1934, as amended (the "Exchange
Act").  All statements other than statements of historical facts
included or incorporated by reference in this quarterly report on Form 10-Q,
including without limitation, statements regarding our future financial
position, business strategy, budgets, projected revenues, projected costs and
plans and objective of management for future operations, are forward-looking
statements.  In addition, forward-looking statements generally can be
identified by the use of forward-looking terminology such as "may," "will,"
"expects," "intends," "plans," "projects," "estimates," "anticipates," or
"believes" or the negative thereof or any variation there on or similar
terminology or expressions.





These
forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ materially from results proposed in such
statements.  Although we believe that the expectations reflected in
such forward-looking statements are reasonable, we can give no assurance that
such expectations will prove to have been correct.  Important factors
that could cause actual results to differ materially from our expectations
include, but are not limited to: a decline in ATM transaction volume or fees,
changes in technology standards, a failure by third parties to service our ATMs,
regulatory changes, increases in interest rates, the inability to obtain cash
for our ATMs, reduction in the number of transacting ATMs, market acceptance of
our student loan processing services, demand for student loans, availability of
credit, changes in regulations regarding student loans and financial
institutions, and statements of assumption underlying any of the foregoing, as
well as other factors set forth under the caption "Risk Factors" in our Annual
Report on Form 10-K for the year ended December 31, 2009 filed with the
Securities and Exchange Commission.


14





All
subsequent written and oral forward-looking statements attributable to us, or
persons acting on our behalf, are expressly qualified in their entirety by the
foregoing.  Except as required by law, we assume no duty to update or
revise our forward-looking statements based on changes in internal estimates,
expectations, or otherwise.





Overview





We are an independent sales
organization which acts as the source for businesses to purchase and operate
automated teller machines, or ATMs.  From 1999 to 2008, we expanded
our ATM sales, service and operations through internal growth and acquisitions
including the acquisition of a network of over 15,000 ATMs in November 2004 from
eFunds, and 4,200 ATMs in April 2008 when we acquired LJR Consulting, an
independently-owned ATM company ("LJR Consulting").





We currently manage, own and operate
approximately 12,000 ATMs across the United States (typically under multi-year
contracts) for independent store owners, larger retail chains, hotels, stadiums,
universities, banks, credit unions, and other financial
institutions.  We also offer our financial institution clients a
one-stop solution for new branch construction and fit outs.  In
addition to providing our merchant customers with supplemental revenues from
transaction fees, we believe that the presence of ATMs in a merchant’s store
helps to promote higher foot traffic, increased impulse purchases, and longer
shopping times since they often make the retail site a destination for
cash.  We attempt to maximize the usefulness of our ATMs to our
customers by participating in as many Electronic Funds Transfer Networks
("EFTNs") as practical, including NYCE, Visa, MasterCard, Cirrus, Plus, American
Express, Discover/Novus, STAR, Allpoint and Moneypass.





Operational
Metrics





We derive most of our revenue from
transaction-based sales.  We also generate revenue from the sale of
ATM equipment and service calls which we contract vendors to
perform.  A description of these revenue sources is provided
below.





Transaction-based
sales — sales we derive from withdrawal fees and interchange
fees.





·
            Withdrawal fees — fees
      we receive from a processor derived from a customer making an ATM
      withdrawal.  Withdrawal fees are sometimes referred to as
      surcharge or convenience fees in the
industry.




·
            Interchange fees — fees
      that an EFTN charges the customer’s financial institution for routing a
      withdrawal transaction or an account balance inquiry.  The
      interchange fee is shared between the EFTN and us, as the ATM service
      provider, based on an agreement between us and the
      EFTN.  Interchange fees apply to all transactions on ATMs that
      we own and ATMs owned by merchants and managed or serviced by
      us.





Service and other
sales — fees we charge for providing repair, maintenance, other services,
parts and supplies to merchants who purchase or rent ATMs from
us.


15


Sales of ATM
equipment — sales of ATM equipment to an independent operator or
merchant.
 
 The principal cost related to the
operation of an ATM is the commissions we pay to a merchant or the ATM owner.
The amount of the commission is dependent on a number of factors the most
important of which is whether we provide the cash for the machines. Generally,
full placement machines incur the lowest sales commission.
 
 Restructuring and
Branding
 
 During the past two years, we have
implemented a plan to strengthen our Company by focusing specifically on the
sales, service and management of ATMs within the United States. We underwent a
complete restructuring effort by selling underperforming operations and assets,
streamlining operating unit functionality and responsibility, reviewing and
renegotiating vendor relationships and contracts, identifying complementary
business partners and managing to our core strengths.
 
 One of the key changes we have made to
help identify the Company to the public was to change our corporate name to
"Access to Money, Inc." We believe this name and brand uniquely identify the
products and services we offer and provides a simple, yet powerful, vision and
connection to our clients, industry and consumers.
 
 Economic and Strategic
Outlook
 
 We expect to continue to improve our
cash flow through expense management, new sales, and efforts to restructure our
debt and its associated cost. Through our continued cost management and
efficiency measures we were able to drive gross profit and operating profit to
forecasted levels. The transaction volume reduction was partially due to the
selective removal of lower performing unprofitable ATMs based on profitability
analyses we performed across our portfolio. We will continue to evaluate the
profitability of our ATMs on a regular basis and make decisions to maximize the
value of each unit.
 
 While changes in consumer practices
have impacted the number of ATM transactions, we have continued to leverage our
partnership with Select-A-Branch to deploy Select-A-Branch enabled ATMs which
provide surcharge free transactions to participating financial institutions. We
continue to see significant increases in transaction volume at surcharge free
machines which have been installed at specific locations of our largest
customers.
 
 We also continue to pursue agreements
with national and regional retailers, franchisors, and associations to deploy
our ATMs in all of their locations. These efforts have resulted in our selection
as one of two approved vendors to Dunkin Donuts and as the preferred provider to
the Credit Union League of Connecticut.
 Our
master agreement with Cumberland Farms to supply ATMs to all of its stores
recently expired. While we
have been in discussions regarding renewal, it is now apparent that the
agreement will not be renewed.
Therefore, we expect a reduction in the number of ATMs currently operating in
Cumberland Farms
stores over the next six to twelve months. If we are unable to replace these
expiring transacting units
with new business, our financial results for future periods would be adversely
affected.
 16
  We
continue to move our student loan services business forward by our new
partnership with People Capital. By combining our services along with People
Capital's turnkey solution for the selection, origination and servicing of
private student loans, we look to bring People Capital's loan lending technology
to credit unions and community banks across the country. This
partnership provides us with the ability to offer both origination and
servicing support to our customers.





Results
of Operations





The following tables set forth
information from our Condensed Consolidated Statements of Operations and
selected operating amounts.  The results are in thousands except for
operating amounts and percentages.





Three
Months ended March 31, 2010 Compared to Three Months ended March 31,
2009





Three Months Ended March 31,2010
                
                
                2009Amount
                
                
                %
                
                
                Amount
                
                
                %Transaction-based
      sales
                
                $
                20,184
                
                
                
                100.0
                %
                
                $
                20,781
                
                
                
                100.0
                %Less
      commissions
                
                
                14,572
                
                
                
                72.2
                %
                
                
                14,981
                
                
                
                72.1Net
      transaction-based sales
                
                
                5,612
                
                
                
                27.8
                %
                
                
                5,800
                
                
                
                27.9
                %Service
      and other sales
                
                
                605
                
                
                
                
                
                
                
                1,034Sales
      of ATM equipment
                
                
                1,330
                
                
                
                
                
                
                
                363Branch
      build out
                
                
                84
                
                
                
                
                
                
                
                66Net
      sales
                
                
                7,631
                
                
                
                
                
                
                
                7,264Cost
      of sales
                
                
                4,318
                
                
                
                
                
                
                
                3,607Gross
      profit
                
                $
                3,313
                
                
                
                
                
                
                $
                3,657Operating
      data:Average
      number of transacting ATMs
                
                
                10,983
                
                
                
                
                
                
                
                11,425Withdrawal
      transactions
                
                
                8,194,709
                
                
                
                
                
                
                
                8,691,180Average
      withdrawals per ATM per month
                
                
                249
                
                
                
                
                
                
                
                254Average
      gross transaction-based sales per withdrawal transaction
                
                $
                2.46
                
                
                
                
                
                
                $
                2.39Average
      commission per withdrawal transaction
                
                $
                1.78
                
                
                
                
                
                
                $
                1.72Average
      net transaction-based sales per withdrawal transaction
                
                $
                .68
                
                
                
                
                
                
                $
                .67


17





Sales





Transaction-based sales were $20.2
million during the first quarter of 2010 compared to $20.8 million for the same
period in 2009.  This $600,000, or 2.9%, decrease was primarily
attributable to fewer transacting units between the periods due to the selective
removal of lower performing units in 2009.  Service and other sales
decreased $429,000 to $605,000 in the first quarter of 2010 compared to
2009.  This was primarily due to fewer field service calls than the
first quarter of 2009 as a result of improved over-the-phone technical
assistance by our in-house service team and a larger amount of our ATM
population consisting of newer units compared to past periods.





The average number of transacting ATMs
in our network during the first quarter of 2010 decreased by 442 from the first
quarter of 2009 primarily as the result of normal attrition and the selective
removal of underperforming ATMs during 2009.  The decrease in the
number of transacting machines contributed to a $496,000, or 5.7%, decrease in
the number of withdrawal transactions during the three months ended March 2010
as compared to the three months ended March 31, 2009.





Commissions





Commissions decreased from
$15.0 million in the first quarter of 2009 to $14.6 million in the
first quarter of 2010.  This decrease of approximately $400,000, or
2.7%, resulted primarily from fewer transactions.  As a percentage of
transaction-based sales, commissions increased to 72.2% in the first quarter of
2010 from 72.1% in the first quarter of 2009.  The average commission
per withdrawal transaction increased to $1.78 for the first quarter of 2010 as
compared to $1.72 for the first quarter of 2009.  The higher
commission per withdrawal is the combination of new commission structures on
recently sold ATM contracts compared to those for machines that were taken out
of service and higher transaction volumes during 2009.





Cost
of Sales





Cost of sales from operations consist
primarily of cost of vault cash, maintenance and third party service costs, and
ATM processing costs.  Costs of sales increased approximately
$712,000, or 19.7%, to $4.3 million during the first quarter of 2010
compared to $3.6 million in the first quarter of 2009, resulting in a
$344,000, or 9.4%, decrease in gross profit to $3.3 million from
$3.7 million in the first quarter of 2009.





Our cost of vault cash increased by
$48,000, or 10.5%, to $513,000 during the first quarter of 2010 from $465,000 in
the first quarter of 2009.  The number of ATMs which we provide cash
for increased by 4.1% from 2,147 in March 2009 to 2,235 in
March 2010.  The average amount of vault cash used in the first
quarter of 2010 increased by 10.9%, to $45.6 million from
$41.1 million during the first quarter of 2009.  The interest
rate on ourvault
cash facility remained constant at 2.75% between March 31, 2009 and
March 31, 2010.





Maintenance and third party service
costs decreased $23,000 to $857,000 in the first quarter of 2010 compared to
$881,000 in the first quarter of 2009.


18





Processing fees decreased $262,000, or
36.8%, to $449,000, in the first quarter of 2010 compared to $711,000 in the
first quarter of 2009.  The decrease is due to the combination of
lower transactions in the first quarter of 2010 as compared to the first quarter
of 2009 and a credit received from one of our processors for incorrect charges
billed during fiscal year 2009.





Armored car costs decreased $211,000,
or 30.8%, to $475,000 in the first quarter of 2010 from $686,000 in the first
quarter of 2009.  This reduction is primarily attributable to the
reconciliation of accrued cost in comparison to the actual cost.





The cost of machine sales increased
$1.1 million, or 390.1%, to $1.4 million in the first quarter of 2010
compared to $284,000 in the first quarter of 2009.  This increase is
due to improved sales between the first quarter of 2009 and the first quarter of
2010, which we attribute to both new and existing customers having more
confidence in the financial condition of the economy combined with the expansion
of ATM offerings in their retail locations.





Selling,
General and Administrative Expense





Selling, general and administrative
expense decreased by $225,000, or 8.0%, to $2.6 million in the first
quarter of 2010 from $2.8 million in the first quarter of
2009.  Selling, general and administrative expense as a percent of net
sales decreased to 33.9% in the first quarter of 2010 from 38.7% in the first
quarter of 2009.





Payroll costs decreased by $229,000, or
15.9%, to $1.2 million in the first quarter of 2009 from $1.4 million
in the first quarter of 2009.  This decrease is attributable to the
reversal of accrued bonus for 2009 which was not paid.





Our cost for outsourced and
professional services decreased by $40,000, or 29.1%, in the first quarter of
2010 compared to the first quarter of 2009, primarily due to a lesser need for
external assistance on projects handled by internal resources.





Operating
Income





During the first quarter of 2010, we
generated $728,000 of operating income as compared to $847,000 in the first
quarter of 2009.





Interest
Expense, Amortization of Debt Issuance Costs





Interest expense remained constant
between the first quarter of 2010 and 2009 at $757,000 and $734,000,
respectively.





Amortization of debt issuance cost also
remained flat between the first quarter of 2010 and 2009 at $559,000 and
$554,000, respectively.


19





Loss
on Warrant Value





Effective January 1, 2009, we
adopted new accounting guidance that can affect the accounting for warrants and
many convertible instruments with provisions that protect holders from a decline
in the stock price.  Protection provisions reduce the exercise price
of a warrant or convertible instrument if the issuer either issues equity shares
for a price that is lower than the exercise price of those instruments or issues
new warrants or convertible instruments that have a lower exercise
price.  We evaluated and determined that outstanding warrants to
acquire our stock contain provisions that protect holders from declines in the
stock price and as a result, recognized these warrants as liabilities at their
respective fair values on each reporting date.  For a complete
description of the loss on warrant value, see our consolidated financial
statements contained elsewhere in this report.





The table below provides a
reconciliation of the beginning and ending balances for our warrant liability
and increase in fair value using significant unobservable inputs (Level 3) as of
March 31, 2010 (in thousands).





Balance
      as of December 31, 2009
                    
                    $
                    6,747Increase
      in fair value of warrants
                    
                    
                    139Balance
      as of March 31, 2010
                    
                    $
                    6,886





Provision
for Income Taxes





We have recorded no benefit from our
losses for the first quarter of 2010 and 2009 because we are uncertain that we
will be able to realize the benefit of our net operating loss carryforwards and
future deductible amounts.





Net
Loss





We recognized a net loss of $716,000
for the first quarter of 2010 compared to a net loss of $597,000 for the first
quarter of 2009.





Liquidity
and Capital Resources





Our principal ongoing funding
requirements are for working capital to finance operations, make debt payments,
and fund capital expenditures.  We believe that our liquidity and
capital resources are adequate for our currently anticipated needs over the next
twelve months.





Net cash provided by operating
activities during the quarter ended March 31, 2010 was $1.1 million
compared to $2.3 million during the quarter ended March 31,
2009.  During the first three months of 2010, the principal factor
contributing to the decrease in cash provided by operations was the increase in
restricted cash in 2009 without a comparable transaction in 2010 and changes in
current accounts receivable, accrued expenses and accounts
payable.


20





Net cash used in investing activities
during the quarter ended March 31, 2010 was $92,000 compared to $389,000 in
the quarter ended March 31, 2009 which related to capital expenditures of
ATMs and equipment.





Net cash used for financing activities
was $869,000 during the quarter ended March 31, 2010 and consisted of the
repayment of term loans.  Net cash used during the quarter ended
March 31, 2009 was $255,000 and was also for the repayment of term
loans.





We had cash and cash equivalents of
approximately $5.9 million at March 31, 2010 compared to
$5.8 million at December 31, 2009.  At March 31, 2010,
we had a net working capital deficit of $1.6 million compared to a net
working capital deficit of $1.9 million at December 31,
2009.





For a complete description of
indebtedness, please see Note 4 of our financial statements included in Part I,
Item 1 of this report.





Off-Balance
Sheet Arrangements





As of
March 31, 2010, we did not have any relationships with unconsolidated entities
or financial partners, such as entities often referred to as structured finance
or special purpose entities, established for the purpose of facilitating
off-balance sheet arrangements or other contractually narrow or limited
purposes.  As such, we are not materially exposed to any financing,
liquidity, market or credit risk that could arise if we had engaged in such
relationships.





Critical
Accounting Policies and Estimates





Our critical accounting policies and
estimates as of March 31, 2010 are consistent with those discussed in our
Annual Report on Form 10-K for the year ended December 31,
2009.





New
Accounting Standards





See Note 2 of Notes to Condensed
Consolidated Financial Statements in Part I, Item 1 for a discussion
of recent accounting pronouncements.


21





ITEM
      4T.
            CONTROLS
      AND PROCEDURES





As of March 31, 2010, we carried out
the evaluation of the effectiveness of our disclosure controls and procedures
required by Rule 13a-15(e) under the Exchange Act under the supervision and with
the participation of our management, including our Chief Executive Officer and
Chief Financial Officer.  Based upon that evaluation, our Chief
Executive Officer and Chief Financial Officer concluded that, as of March 31,
2010, our disclosure controls and procedures were effective to provide
reasonable assurance that information we are required to disclose in reports
that we file or submit under the Exchange Act is: (i) recorded, processed,
summarized and reported within the time periods specified in the SEC’s rules and
forms, and (ii) accumulated and communicated to our management, including our
Chief Executive Officer and Chief Financial Officer, as appropriate to allow
timely decisions regarding required disclosure.





There has
been no change in our internal control over financial reporting identified in
connection with this evaluation that occurred during our fiscal quarter ended
March 31, 2010 that has materially affected, or is reasonably likely to
materially affect, our internal control over financial
reporting.


22





PART
II – OTHER INFORMATION





ITEM
      6.
            EXHIBITS





31.1
            Certification
      of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the
      Securities Exchange Act of 1934, as amended, as adopted pursuant to
      Section 302 of the Sarbanes-Oxley Act of
2002.





31.2
            Certification
      of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the
      Securities Exchange Act of 1934, as amended, as adopted pursuant to
      Section 302 of the Sarbanes-Oxley Act of
2002.





32.1
            Certification
      of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  2002.





32.2
            Certification
      of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
      pursuant to Section 906 of the Sarbanes-Oxley Act of
  2002.


23





SIGNATURE





Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.





ACCESS
      TO MONEY, INC.Date:   May
      13, 2010
              By:
              /s/ Michael J. DolanMichael
      J. DolanChief
      Financial Officer


24