Unassociated Document






Exhibit 4.25

SUBSCRIPTION AGENT AGREEMENT





_______________, 2009



 

American Stock Transfer & Trust Company, LLC

59 Maiden Lane

New York, New York 10038









Ladies and Gentlemen:





In connection with your appointment as Subscription Agent in the transaction described herein, USA Technologies, Inc., a Pennsylvania corporation (the “Company”), hereby confirms its arrangements with you as follows:



 


	
1.
	
Rights Offering - The Company is offering (the “Rights Offering”) transferable rights (the “Rights”) pursuant to which the holders thereof (the “Rights Holders”) are entitled to subscribe for the Company’s common stock, no par value per share (the “Common Stock”) and warrants to purchase
shares of Common Stock (the “Warrants”). Such Rights are being distributed to all shareholders of record of Common Stock (“Record Date Stockholders”) as of [        ], New York City time, on [        ] (the “Record Date”) as well as to two warrant holders of the Company who are entitled to participate in the Rights Offering pursuant to the terms of their warrants (“Participating Warrant Holders”).
The Rights, Common Stock and Warrants are described in a prospectus dated [        ], 2009 (the “Prospectus”). Capitalized terms not otherwise defined herein shall have the meaning given to them in the Prospectus.




 

As described in the Prospectus, the Company is issuing to Record Date Stockholders and the Participating Warrant Holders Rights to subscribe for up to [        ] shares of Common Stock and Warrants to purchase up to ______ shares of Common Stock. Each Record Date Stockholder is being issued one Right for
each share of Common Stock owned on the Record Date and each Participating Warrant Holder is being issued one Right for each share of Common Stock into which the warrants held by such Participating Warrant Holder are exercisable as of the Record Date. No fractional Rights will be issued, and any fractional Rights resulting from the issuance of the Rights will be rounded up to the next whole Right. The Rights entitle each Rights Holder to acquire one share of Common Stock and  Warrants to acquire one
share of Common Stock for every Right held, which is referred to as the basic subscription right (the “Basic Subscription Right”). Rights may be exercised at any time during the subscription period (the “Subscription Period”), which commences on [        ], 2009, and ends at [        ], New York City time, on [        ], the expiration date, unless extended by the Company (as may be
so extended, the “Expiration Date”).

 

The subscription price for the Rights (the “Subscription Price”) is $_____.

 

Shares of Common Stock and Warrants not subscribed for by Rights Holders as part of the Basic Subscription Rights (the “Remaining Securities”) will be offered, by means of the over-subscription privilege (the “Over-Subscription Privilege”) to the Rights Holders, in each case only to the extent such Rights Holder has
fully exercised the Rights issued to it and wish to acquire more than the number of shares of Common Stock and Warrants they are entitled to purchase pursuant to the Basic Subscription Right and on the terms and subject to the conditions set forth in the Prospectus, including as to proration. The Rights will be evidenced by subscription certificates (the “Subscription Certificates”).





  



1







  



 


	
2.
	
Appointment of Subscription Agent - You are hereby appointed as Subscription Agent to effect the Rights offering in accordance with the Prospectus. Each reference to you in this letter is to you in your capacity as Subscription Agent unless the context indicates otherwise.









	
3.
	
Delivery of Documents - Enclosed herewith are the following, the receipt of which you acknowledge by your execution hereof:





	
  
	
(a)
	
a copy of the Prospectus;





	
  
	
(b)
	
the form of Subscription Certificate (with instructions);





	
  
	
(c)
	
resolutions adopted by the Board of Directors of the Company in connection with the Rights Offering, certified by the secretary of the Company; and





	
  
	
(d)
	
Notice of Guaranteed Delivery.








As soon as is reasonably practical, you shall mail or cause to be mailed to each Record Date Stockholder and Participating Warrant Holder at the close of business on the Record Date a Subscription Certificate evidencing the Rights to which such holder is entitled, a Notice of Guaranteed Delivery, a Prospectus and an envelope addressed to
you. Prior to mailing, the Company will provide you with blank Subscription Certificates which you will prepare and issue in the names of the Record Date Stockholders and Participating Warrant Holders for the number of Rights to which they are entitled.  The Company will also provide you with a sufficient number of copies of each of the documents to be mailed with the Subscription Certificates.


  



	
4.
	
Subscription Procedure -








(a) Upon your receipt prior to 5:00 p.m., New York City time, on the Expiration Date (by mail or delivery), as Subscription Agent, of (ii) any Subscription Certificate completed and endorsed for exercise, as provided on the reverse side of the Subscription Certificate (except as provided in paragraph 8 hereof), and (ii) payment in full of
the Subscription Price in U.S. funds by check, bank draft or money order payable at par (without deduction for bank service charges or otherwise) to the order of American Stock Transfer FBO USA Technologies, Inc., you shall as soon as practicable after the Expiration Date, but after performing the procedures described in subparagraphs (b), (c) and (d) below, mail to the subscriber’s registered
address on the books of the Company certificates representing the securities underlying each Right duly subscribed for (pursuant to the Basic Subscription Right and the Over-Subscription Privilege) and furnish a list of all such information to the Company.





(b) As soon as practicable after the Expiration Date you shall calculate the number of shares of Common Stock and Warrants to which each subscriber is entitled pursuant to the Over-Subscription Privilege. The Over-Subscription Privilege may only be exercised by holders who subscribe to all the shares of Common Stock and Warrants that can
be subscribed for under the Basic Subscription Right.  The Common Stock and Warrants available for additional subscriptions will be those that have not been subscribed and paid for pursuant to the Basic Subscription Right (the ”Remaining Securities”).  Where there are sufficient Remaining Securities to satisfy all additional subscriptions by holders exercising their rights under the Over-Subscription Privilege, each holder shall be allotted the number of Additional Securities subscribed
for. If the aggregate number of shares of Common Stock and Warrants subscribed for under the Over-Subscription Privilege exceeds the number of Remaining Securities, the number of Remaining Securities allotted to each participant in the Over-Subscription Privilege shall be the product (disregarding fractions) obtained by multiplying the number of Remaining Securities by a fraction of which the numerator is the number of Remaining Securities subscribed for by that participant under the Over-Subscription Privilege
and the denominator is the aggregate number of Remaining Securities subscribed for by all participants under the Over-Subscription Privilege. Any fractional Remaining Securities to which persons exercising their Over-Subscription Privilege would otherwise be entitled pursuant to such allocation shall be rounded to the next whole share of Common Stock or Warrant.





  



2







  



 

(c) Upon calculating the number of Remaining Securities to which each subscriber is entitled pursuant to the Over-Subscription Privilege and the amount overpaid, if any, by each subscriber, you shall, as soon as practicable, furnish a list of all such information to the Company.





(d) Upon calculating the number of Remaining Securities to which each subscriber is entitled pursuant to the Over -Subscription Privilege and assuming payment for the additional Remaining Securities subscribed for has been delivered, you shall mail, as contemplated in subparagraph (a) above, the certificates representing the additional securities
which the subscriber has been allotted. If a lesser number of Remaining Securities is allotted to a subscriber under the Over-Subscription Privilege than the subscriber has tendered payment for, you shall remit the difference to the subscriber without interest or deduction at the same time as certificates representing the securities allotted pursuant to the Over-Subscription Privilege are mailed.





(e) Funds received by you pursuant to the Basic Subscription Right and the Over- Subscription Privilege shall be held by you in a segregated account. Upon mailing certificates representing the securities and refunding subscribers for additional securities  subscribed for but not allocated, if any, you shall promptly remit to the
Company all funds received in payment of the Subscription Price for shares of Common Stock and Warrants sold in the Rights Offering.






	
5.
	
Subdivision. Sale or Transfer of Rights -  Until 5:00 p.m., New York City time, on the third business day prior to the Expiration Date, you shall facilitate subdivision or transfers of Subscription Certificates by issuing new Subscription Certificates in accordance with the instructions set forth on the reverse side of the
Subscription Certificates.









	
6.
	
Defective Exercise of Rights Lost Subscription Certificates - The Company shall have the absolute right to reject any defective exercise of Rights or to waive any defect in exercise. Unless requested to do so by the Company, you shall not be under any duty to give notification to holders of Subscription Certificates of any defects or
irregularities in subscriptions. Subscriptions will not be deemed to have been made until any such defects or irregularities have been cured or waived within such time as the Company shall determine. You shall as soon as practicable return Subscription Certificates with the defects or irregularities which have not been cured or waived to the holder of the Rights. If any Subscription Certificate is alleged to have been lost, stolen or destroyed, you should follow the same procedures followed far lost stock certificates
representing Common Stock you use in your capacity as transfer agent for the Company’s Common Stock.








  



3







  






	
7.
	
Late Delivery -  If prior to 5:00 p.m., New York City time, on the Expiration Date you receive (i) payment in full of the Subscription Price for the shares of Common Stock and Warrants being subscribed for and (ii) a guarantee notice substantially in the form of the
Notice of Guaranteed Delivery delivered with the Subscription Certificate, from a financial institution having an office or correspondent in the United States, or a member firm of any registered United States national securities exchange or of the [National Association of Securities Dealers, Inc.] stating the certificate number of the Subscription Certificate relating to the Rights, the name and address of the exercising subscriber, the number of Rights represented by the Subscription Certificate held by such
exercising subscriber, the number of shares of Common Stock and Warrants being subscribed for pursuant to the Rights and guaranteeing the delivery to you of the Subscription Certificate evidencing such Rights within three NASDAQ Global Market (”NGM”) trading days following the date of the Notice of Guaranteed Delivery, then the Rights may be exercised even though the Subscription Certificate was not delivered to you prior to 5:00 p.m., New York City time, on the Expiration Date, provided that within
three NGM trading days following the date of the Notice of Guaranteed Delivery you receive the properly completed Subscription Certificate evidencing the Rights being exercised, with signatures guaranteed if required.









	
8.
	
Delivery - You shall deliver to the Company the exercised Subscription Certificates in accordance with written directions received from the Company and shall deliver to the subscribers who have duly exercised Rights at their registered addresses certificates representing the securities subscribed for as instructed on the reverse side
of the Subscription Certificates.









	
9.
	
Reports - You shall notify the Company by telephone on or  before the close of business on each business day during the period commencing 5 business days after the mailing of the Rights and ending at the Expiration Date (and in the case of guaranteed deliveries ending three NGM trading days after the Expiration Date) (a ”daily
notice”), which notice shall thereafter be confirmed in writing, of (i) the number of Rights exercised on the day covered by such daily notice and the name and address of each such exercising Rights Holder, (ii) the number of Rights subject to guaranteed exercises on the day covered by such daily notice, (iii) the number of Rights for which defective exercises have been received on the day covered by such daily notice, (iv) the cumulative total of the information set forth in clauses (i) through (iii) above,
(v) for each soliciting broker-dealer, the number of Rights exercised indicating such broker-dealer as the broker-dealer with respect to such exercise, and (vi) such other information as the Company may reasonably request.  At or before 5:00 p.m., New York City time, on the first NGM trading day following the Expiration Date you shall certify in writing to the Company the cumulative total through the Expiration Date of all the information set forth in clauses (i) through (vi) above. At or before 10:00
a.m., New York City time, on the fifth NGM trading day following the Expiration Date you will execute and deliver to the Company a certificate setting forth the number of Rights exercised pursuant to a Notice of Guaranteed Delivery and as to which Subscription Certificates have been timely received. You shall also maintain and update a listing of Rights Holders who have fully or partially exercised their Rights, Rights Holders who have transferred their Rights and their transferees, and Rights Holders who have
not exercised their Rights.  You shall provide the Company or its designees with such information compiled by you pursuant to this paragraph 9 as any of them shall request.








  



4







  



 


	
10.
	
Future Instructions – With respect to notices or instructions to be provided by the Company hereunder, you may rely and act on any written instruction signed by any one or more of the following authorized officers or employees of the Company:








George R. Jensen, Jr.-Chief Executive Officer

David M. DeMedio –Chief Financial Officer






	
11.
	
Payment  of Expenses - The Company will pay you compensation for acting in your capacity as Subscription Agent hereunder in the amount specified in the Fee Schedule attached hereto. The Company will pay an additional fee equal to one-third of the Subscription Agent fee for each extension of the Offering, plus any out-of-pocket
expenses associated with such extension.









	
12.
	
Counsel - You may consult with counsel satisfactory to you, which may be counsel to the Company, and the advice or opinion of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by you hereunder in good faith
and in accordance with such advice an opinion of such counsel.









	
13.
	
Indemnification - The Company covenants and agrees to indemnify and hold you harmless against any costs, expenses (including reasonable fees of legal counsel), losses or damages, which may be paid, incurred or suffered by or to which you may become subject arising from or out of, directly or indirectly, any claim or liability resulting
from your actions as Subscription Agent pursuant hereto; provided that such covenant and agreement does not extend to such costs, expenses, losses and damages incurred or suffered by you as a result of, or arising out of, your own gross negligence, misconduct or bad faith or that of any employees, agents or independent contractors used by you in connection with performance of your duties as Subscription Agent hereunder.









	
14.
	
Notices -  Unless otherwise provided herein, all reports, notices and other communications required or permitted to be given hereunder shall be in writing and delivered by hand or confirmed telecopy or by first class U.S. mail, postage prepaid, shall be deemed given
if by hand or telecopy, upon receipt or if by U.S. mail, three business days after deposit in the U.S. mail and shall be addressed as follows













	
  
	
(a)
	
If to the Company, to:








USA Technologies, Inc.

Suite 140, 100 Deerfield Lane

Malvern, PA 19355

Attn: Mr. David M. DeMedio

Telephone: (610) 989-0340

Telecopier: (610) 989-0344






	
  
	
(b)
	
If to you, to:








American Stock Transfer & Trust Company, LLC

59 Maiden Lane

New York, N.Y. 10038

Attention: George Karfunkel

Telephone: (718) 921-8200

Telecopy: (718) 236-4588





  



5







  



 


	
Yours truly,
	
USA TECHNOLOGIES, INC.

	  	  	  
	  	
By:
	  
	  	  	  
	  	
Name:
	  
	  	  	  
	  	
Title:
	  







Agreed & Accepted:

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC






	
By:
	  	  
	  	  	  
	
Name:
	  	  
	  	  	  
	
Title:
	  	  







  



6







  





Fee Schedule









Flat fee of $___________

Plus reasonable out-of-pocket expenses.

 

 

7