Document:

exv10w13

Exhibit 10.13

SUBORDINATED PROMISSORY NOTE

 

			
	$9,754,465
	 	Philadelphia, Pennsylvania

April 18, 2008

     FOR VALUE RECEIVED, TRM Corporation, an Oregon corporation (“Maker”), promises to pay to
Douglas Falcone (“Payee”), in lawful money of the United States of America, the principal sum of
Nine Million Seven Hundred Fifty Four Thousand Four Hundred Sixty Five dollars ($9,754,465),
together with interest in arrears on the unpaid principal balance at an annual rate equal to
thirteen percent (13%), in the manner provided below. Interest shall be calculated on the basis of
a year of 365 or 366 days, as applicable, and charged for the actual number of days elapsed.

     This Note has been executed and delivered pursuant to and in accordance with the terms and
conditions of the Stock Purchase Agreement, dated April 18, 2008 , by and between Maker and Payee
(the “Agreement”) and is subject to the terms and conditions of the Agreement, which are, by this
reference, incorporated herein and made a part hereof. Capitalized terms used in this Note
without definition shall have the respective meanings set forth in the Agreement.

1. PAYMENTS

1.1 PRINCIPAL AND INTEREST

The principal amount of this Note, together with accrued but unpaid interest and all other amounts
payable under this Note shall be due and payable on April 18, 2015 (the “Maturity Date”). Interest
on the unpaid principal balance of this Note shall be due and payable quarterly in arrears 50 days
following the end of each quarter, commencing with July 1, 2008.

1.2 MANNER OF PAYMENT

All payments of principal and interest on this Note shall be made by wire transfer of immediately
available funds to an account designated by Payee in writing. If any payment of principal or
interest on this Note is due on a day that is not a Business Day, such payment shall be due on the
next succeeding Business Day, and such extension of time shall be taken into account in
calculating the amount of interest payable under this Note. “Business Day” means any day other
than a Saturday, Sunday or legal holiday in the State of New Jersey.

1.3 SUBORDINATION

Payee hereby agrees that until the amounts owed pursuant to the Securities Purchase Agreement dated
as of April 18, 2008 (the “Lampe II Facility”) among, inter alia, Maker, the purchasers named
therein and Lampe Conway & Co., LLC, as administrative agent and collateral agent (in such
capacities (“Agent”), have been indefeasibly paid in full in cash, and notwithstanding anything to
the contrary in this Note or any other agreement related hereto (other than Section 7.5 of the
Purchase Agreement), all rights of payment or enforcement in favor of Payee under this Note and all
other obligations of Maker to Payee under this Note, shall in all respects be, and effective
immediately

 

 

hereby are, subject, subordinate, and junior, in right of payment and enforcement, to the prior
indefeasible payment of the Lampe II Facility in full in cash; provided, however, that so long as
no default or event of default under the Lampe II Facility has occurred and is continuing, Payee
may receive payments from Maker in accordance with this Note. In the event of any payment or
distribution of assets of any kind or character, whether in cash, property, or securities, upon the
dissolution, winding up, or total or partial liquidation or reorganization, readjustment,
arrangement, or similar proceeding relating to Maker or its subsidiaries, or any of their property,
whether voluntary or involuntary, or in bankruptcy, insolvency, receivership, arrangement, or
similar proceedings or upon an assignment for the benefit of creditors, or upon any other
marshaling or composition of the assets and liabilities of Maker or its subsidiaries, or otherwise
(such events, collectively, the “Insolvency Events”): (i) all amounts owing on account of the Lampe
II Facility shall first be indefeasibly paid in full in cash before any payment or distribution on
account of Payee may be received by or on behalf of Payee; and (ii) to the extent permitted by
applicable law, any payment or other distribution on account of Payee to which it would be entitled
but for the provisions hereof, shall be paid or delivered by the trustee in bankruptcy, receiver,
assignee for the benefit of creditors, or other liquidating agent making such payment or
distribution directly to the Agent under the Lampe II Facility, for application to the payment of
the Lampe II Facility in accordance with clause (i), after giving effect to any concurrent payment
or distribution or provision therefor to the Agent under the Lampe II Facility, in respect of such
Lampe II Facility; provided, however, that so long as no default or event of default under the
Lampe II Facility has occurred and is continuing under the Lampe II Facility, Payee may receive
payments from Maker in accordance with this Note. Notwithstanding anything in this Note or any
other agreement related hereto to the contrary, until the Lampe II Facility is indefeasibly repaid
in full in cash, if a default or event of default has occurred and is continuing thereunder, (y)
Maker shall not make, and Payee agrees not to accept or receive, directly or indirectly, any
payment (whether of principal or interest) or other distribution on account of Payee, and (z) Payee
further agrees that the failure to pay when otherwise due any amount that would be payable to Payee
but for this Section, shall not, in and of itself, constitute a default of Maker’s under this Note.

1.4 OPTIONAL PREPAYMENT

Maker may, without premium or penalty, at any time and from time to time, but subject to Section
1.3, prepay all or any portion of the outstanding principal balance due under this Note, provided
that each such prepayment is accompanied by accrued interest on the amount of principal prepaid
calculated to the date of such prepayment.

1.5 MANDATORY PREPAYMENT

In the event of a Change of Control, but subject to Section 1.3, Maker shall pay Payee the
outstanding principal and interest due on this Note. “Change of Control” shall mean:

(a) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than
by way of merger or consolidation), in one or a series of related transactions, of all or
substantially all of the properties or assets of Maker and its subsidiaries taken as a whole, to
any “person” (as that term is defined in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”));

 

 

(b) the consummation of any transaction (including, without limitation, any merger or
consolidation) the result of which is that any “Person” (as that term is defined in Rule 13d-3
under the Exchange Act), becomes the “Beneficial Owner” (as that term is defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of more than 35% of the voting stock of Maker; or

(c) Maker consolidates or merges with or into another Person or any Person consolidates or
merges with or into Maker, in either case under this clause (c), in one transaction or a series of
related transactions in which immediately after the consummation thereof Beneficial Owners (as
defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of voting stock representing in
the aggregate a majority of the total voting power of the voting stock of Maker immediately prior
to such consummation are not Beneficial Owners, directly or indirectly, of voting stock
representing a majority of the total voting power of the voting stock of Maker or the surviving or
transferee Person immediately following such consummation.

2. DEFAULTS

2.1 EVENTS OF DEFAULT

The occurrence of any one or more of the following events with respect to Maker shall constitute
an event of default hereunder (“Event of Default”):

(a) If Maker shall fail to pay when due any payment of principal or interest on this Note
and such failure continues for fifteen (15) days after Payee notifies Maker thereof in writing.

(b) If, pursuant to or within the meaning of the United States Bankruptcy Code or any other
federal or state law relating to insolvency or relief of debtors (a “Bankruptcy Law”), Maker
shall (i) commence a voluntary case or proceeding; (ii) consent to the entry of an order for
relief against it in an involuntary case; (iii) consent to the appointment of a trustee,
receiver, assignee, liquidator or similar official; (iv) make an assignment for the benefit of
its creditors; or (v) admit in writing its inability to pay its debts as they become due.

(c) If a court of competent jurisdiction enters an order or decree under any Bankruptcy Law
that (i) is for relief against Maker in an involuntary case; (ii) appoints a trustee, receiver,
assignee, liquidator or similar official for Maker or substantially all of Maker’s properties;
(iii) orders the liquidation of Maker, and in each case the order or decree is not dismissed
within 60 days or (iv) if Maker makes an assignment for the benefit of creditors.

2.2 NOTICE BY MAKER

Maker shall notify Payee in writing within five days after the occurrence of any Event of
Default.

2.3 REMEDIES

Upon the occurrence of an Event of Default hereunder (unless all Events of Default have been
cured or waived by Payee), Payee may, at its option, exercise any and all rights and remedies
available to it under applicable law, including, without limitation, the right to collect from
Maker all sums due under this Note. Maker shall pay all reasonable costs and expenses incurred
by or on behalf of Payee in connection with Payee’s exercise of any or all of its rights and
remedies under this Note, including, without limitation, reasonable attorneys’ fees.

 

 

3. MISCELLANEOUS

3.1 WAIVER

The rights and remedies of Payee under this Note shall be cumulative and not alternative. No
waiver by Payee of any right or remedy under this Note shall be effective unless in a writing
signed by Payee. Neither the failure nor any delay in exercising any right, power or privilege
under this Note will operate as a waiver of such right, power or privilege, and no single or
partial exercise of any such right, power or privilege by Payee will preclude any other or further
exercise of such right, power or privilege or the exercise of any other right, power or privilege.
To the maximum extent permitted by applicable law, (a) no claim or right of Payee arising out of
this Note can be discharged by Payee, in whole or in part, by a waiver or renunciation of the
claim or right unless in a writing signed by Payee; (b) no waiver that may be given by Payee will
be applicable except in the specific instance for which it is given; and (c) no notice to or
demand on Maker will be deemed to be a waiver of any obligation of Maker or of the right of Payee
to take further action without notice or demand as provided in this Note. Maker hereby waives
presentment, demand, protest and notice of dishonor and protest. Maker also hereby waives trial
by jury in any judicial proceeding brought by either party with respect to this Note.

3.2 NOTICES

Any notice required or permitted to be given hereunder shall be given in accordance with
Section 10.3 of the Agreement.

3.3 SEVERABILITY

If any provision in this Note is held invalid or unenforceable by any court of competent
jurisdiction, the other provisions of this Note will remain in full force and effect. Any
provision of this Note held invalid or unenforceable only in part or degree will remain in full
force and effect to the extent not held invalid or unenforceable.

3.4 SECURITY INTEREST

This Note may be secured in the future by a pledge of 100% of the Capital Stock in accordance with
a separate Pledge, Security and Escrow Agreement of even date herewith.

3.5 GOVERNING LAW

This Note will be governed by and construed under the laws of the State of New Jersey without
regard to conflicts-of-laws principles that would require the application of any other law.

3.6 PARTIES IN INTEREST

This Note shall not be assigned or transferred by Payee without the express prior written consent
of Maker. Subject to the preceding sentence, this Note will be binding in all respects upon Maker
and

 

 

inure to the benefit of Payee and its successors and assigns.

3.7 SECTION HEADINGS; CONSTRUCTION

The headings of Sections in this Note are provided for convenience only and will not affect its
construction or interpretation. All references to “Section” or “Sections” refer to the
corresponding Section or Sections of this Note unless otherwise specified. All words used in this
Note will be construed to be of such gender or number as the circumstances require. Unless
otherwise expressly provided, the words “hereof” and “hereunder” and similar references refer to
this Note in its entirety and not to any specific section or subsection hereof, the words
“including” or “includes” do limit the preceding words or terms and the word “or” is used in the
inclusive sense.

[SIGNATURE APPEARS ON FOLLOWING PAGE]

 

 

IN WITNESS WHEREOF, this Note has been executed by the parties hereto as of the date first
stated above.

	 	 	 	 	 
	 	TRM CORPORATION

 	 
	 	By:  	/s/ Richard Stern
 	 
	 	 	Name:  	Richard Stern 	 
	 	 	Title:  	President & Chief Executive Officer 	 
	 
	 	For the purposes of Section 1.3 only:

 	 
	 	/s/ Douglas Falcone
 	 
	 	Douglas Falconeexv10w14

Exhibit 10.14

VAULT CASH AGREEMENT

          This Vault Cash Agreement (the “Agreement”) is made and entered into effective as of April 18,
2008, by and between TRM Corporation, an Oregon corporation (“TRM”), and Douglas Falcone (“Mr.
Falcone”).

          WHEREAS, Mr. Falcone has heretofore provided vault cash for use by LJR Consulting Corp. d/b/a
Access to Money (“LJR”); and

          WHEREAS, TRM is acquiring the capital stock of LJR (the “LJR Acquisition”) pursuant to a Stock
Purchase Agreement, of even date herewith, by and between TRM and Mr. Falcone (the “Stock Purchase
Agreement”); and

          WHEREAS, at the time of closing of the LJR Acquisition there will be (i) Stockholder Vault
Cash (as such term is defined in the Stock Purchase Agreement) until replaced by vault cash
supplied by TRM and (ii) Circulated Stockholder Vault Cash (as such term is defined in the Stock
Purchase Agreement) until paid into account (the “Account”) maintained by Mr. Falcone at Wachovia
Bank for that purpose as set forth on Exhibit A hereto.

          NOW, THEREFORE, in consideration of the agreements contained herein and for other good and
valuable consideration, the receipt and adequacy of which is hereby acknowledged, and upon the
terms and subject to the conditions hereinafter set forth, the parties hereto, intending to be
legally bound hereby, agree as follows:

	 	1.	 	Capitalized terms used in this Agreement without definition shall have the respective
meanings set forth in the Stock Purchase Agreement.
	 
	 	2.	 	Section 5.12 of the Stock Purchase Agreement is hereby incorporated herein by this
reference as though fully set forth herein.
	 
	 	3.	 	To the extent that Circulated Stockholder Vault Cash is not remitted directly to the
Account but to TRM, TRM shall remit, or cause to be remitted, such Circulated Stockholder
Vault Cash by wire transfer to the Account as and when received by TRM.
	 
	 	4.	 	If all of the Stockholder Vault Cash and Circulated Stockholder Vault Cash, existing
at the Closing and verified by TRM in accordance with the provisions of Section 5.12 of
the Stock Purchase Agreement, is not repaid or replaced in accordance with the terms of
this Agreement within one year from the date hereof (the “Payment Date”), TRM will repay
the amounts of Stockholder Vault Cash and Circulated Stockholder Vault Cash outstanding to
Mr. Falcone in consideration of an assignment by Mr. Falcone to TRM of his right, title
and interest in the outstanding Stockholder Vault Cash and Circulated Vault Cash.

 

 

	 	5.	 	TRM shall pay Mr. Falcone a fee equal to the prime rate less .5% per annum on the
balance of the Stockholder Vault Cash and Circulated Stockholder Vault Cash from time to
time outstanding from the Closing through the date of the remittance thereof to Mr.
Falcone, payable quarterly.
	 
	 	6.	 	Upon payment of the Stockholder Vault Cash and Circulated Stockholder Vault Cash
pursuant to this Agreement, the Account shall be assigned to TRM. Mr. Falcone shall
provide an accounting to TRM on a monthly basis, not later than 10 days after the end of
each month, for all amounts received in the Account as provided herein.
	 
	 	7.	 	TRM shall have the right at any time to pay to Mr. Falcone an amount equal to the
outstanding balance of the Stockholder Vault Cash and the Circulated Stockholder Vault
Cash. Upon such payment, Mr. Falcone shall assign to TRM all of his right, title and
interest in and to the Stockholder Vault Cash, Circulated Stockholder Vault Cash and the
Account.
	 
	 	8.	 	TRM hereby authorizes Mr. Falcone to file a UCC-1 Financing Statement in the
applicable filing office to provide notice of record that Mr. Falcone continues to own the
Stockholder Vault Cash and the Circulated Vault Cash.
	 
	 	9.	 	Upon Mr. Falcone having received all amounts due to him under this Agreement, this
Agreement shall terminate and Mr. Falcone shall deliver to TRM such termination statements
as TRM shall reasonably request with respect to the UCC-1 Financing Statements, if any,
filed pursuant to paragraph 9 of this Agreement.
	 
	 	10.	 	If any provision in this Agreement is held invalid or unenforceable by any court of
competent jurisdiction, the other provisions of this Agreement will remain in full force
and effect. Any provision of this Agreement held invalid or unenforceable only in part or
degree will remain in full force and effect to the extent not held invalid or
unenforceable.
	 
	 	11.	 	This Agreement will be governed by and construed under the laws of the State of New
Jersey without regard to conflicts-of-laws principles that would require the application
of any other law.
	 
	 	12.	 	This Agreement shall not be assigned or transferred by Mr. Falcone without the
express prior written consent of TRM. Subject to the preceding sentence, this Agreement
will be binding in all respects upon TRM and inure to the benefit of Mr. Falcone and its
successors and assigns.

[SIGNATURE APPEARS ON FOLLOWING PAGE]

 

 

          IN WITNESS WHEREOF, the parties have executed this Vault Cash Agreement as of the day and year
first above written.

	 	 	 	 	 
	 

	 	/s/ Douglas Falcone
 

Douglas Falcone
	 	 
	 
	 	 	 	 
	 

	 	TRM CORPORATION	 	 
	 
	 	 	 	 
	 

	 	/s/ Richard Stern	 	 
	 

	 	 	 	 
	 

	 	By:     Richard Stern	 	 
	 

	 	Its:     President and Chief Executive Officer	 	 

 

 

Exhibit List (1)

Exhibit A – Vault Cash Accounts

 

			
	(1)	 	Pursuant to Regulation S-K Item 601(b)(2), the
Company agrees to furnish supplementally a copy of any omitted exhibit to the
Securities and Exchange Commission upon request.

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