Document:

Exhibit 4.34

THESE WARRANTS AND THE COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAW. THESE WARRANTS AND THE COMMON STOCK ISSUABLE UPON THE EXERCISE
HEREOF MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE
OF A REGISTRATION STATEMENT IN EFFECT UNDER SUCH ACT AND SUCH LAWS WITH RESPECT
TO THESE WARRANTS AND THE COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF, OR AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED.

2004-A WARRANT CERTIFICATE                      __________ COMMON STOCK WARRANTS
NO.  ___

                             USA TECHNOLOGIES, INC.

                             COMMON STOCK WARRANTS

              (These Warrants will be void if not exercised by the
                       Termination Date specified below.)

                        1. Warrants. Subject to the terms and conditions hereof,
this certifies that _____________, or any subsequent holder hereof, is the owner
of _______ Warrants (the "Warrants") of USA Technologies, Inc., a Pennsylvania
corporation (the "Company"). Each Warrant entitles the holder hereof to purchase
from the Company at any time prior to 5:00 p.m. on December 31, 2004 (the
"Termination Date"), one fully paid and non-assessable share of the Company's
Common Stock, without par value (the "Common Stock"), subject to adjustment as
provided in Section 7 hereof.

            2. Warrant Price. The Warrants shall be exercised by delivery to the
Company (prior to the Termination Date) of the Warrant price for each share of
Common Stock being purchased hereunder (the "Warrant Price"), this Certificate,
and the completed Election To Purchase Form which is attached hereto. The
Warrant Price shall be $.20 per share of Common Stock. The Warrant Price shall
be subject to adjustment as provided in Section 7 hereof. The Warrant Price is
payable either in cash or by certified check or bank draft payable to the order
of the Company.

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            3. Exercise. Upon the surrender of this Certificate and payment of
the Warrant Price as aforesaid, the Company shall issue and cause to be
delivered with all reasonable dispatch to or upon the written order of the
registered holder of this Warrant and in such name or names as the registered
holder may designate, a certificate or certificates for the number of full
shares of Common Stock so purchased upon the exercise of any Warrant. Such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become a holder of
record of such Common Stock on and as of the date of the delivery to the Company
of this Certificate and payment of the Warrant Price as aforesaid. If, however,
at the date of surrender of this Certificate and payment of such Warrant Price,
the transfer books for the Common Stock purchasable upon the exercise of any
Warrant shall be closed, the certificates for the Common Stock in respect to
which any such Warrant are then exercised shall be issued and the owner of such
Common Stock shall become a record owner of such Common Stock on and as of the
next date on which such books shall be opened, and until such date the Company
shall be under no duty to deliver any certificate for such Common Stock.

            4. Partial Exercise. The rights of purchase represented by the
Warrants shall be exercisable, at the election of the registered holder hereof,
either as an entirety, or from time to time for any part of the Common Stock
specified herein and, in the event that the Warrants are exercised with respect
to less than all of the Common Stock specified herein at any time prior to the
Termination Date, a new Certificate will be issued to such registered holder for
the remaining number of Warrants not so exercised.

            5. Termination Date. All of the Warrants must be exercised in
accordance with the terms hereof prior to the Termination Date. At and after the
Termination Date any and all unexercised rights hereunder shall become null and
void and all such unexercised Warrants shall without any action on behalf of the
Company become null and void.

            6. Lost, Mutilated Certificate. In case this Common Stock Warrant
Certificate shall become mutilated, lost, stolen or destroyed, the Company shall
issue in exchange and substitution for and upon cancellation of the mutilated
certificate, or in lieu of and in substitution for the Certificate lost, stolen,

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or destroyed, a new Certificate of like tenor and representing an equivalent
right or interest, but only upon receipt of evidence satisfactory to the Company
of such loss, theft or destruction of such certificate and indemnity, if
requested, also satisfactory to the Company.

            7. Adjustments. Subject and pursuant to the provisions of this
Section 7, the Warrant Price and number of shares of Common Stock subject to the
Warrants shall be subject to adjustment from time to time only as set forth
hereinafter:

                  a. In case the Company shall declare a Common Stock dividend
on the Common Stock, then the Warrant Price shall be proportionately decreased
as of the close of business on the date of record of said Common Stock dividend
in proportion to such increase of outstanding shares of Common Stock.

                  b. If the Company shall at any time subdivide its outstanding
Common Stock by recapitalization, reclassification or split-up thereof, the
Warrant Price immediately prior to such subdivision shall be proportionately
decreased, and, if the Company shall at any time combine the outstanding shares
of Common Stock by recapitalization, reclassification, or combination thereof,
the Warrant Price immediately prior to such combination shall be proportionately
increased. Any such adjustment to the Warrant Price shall become effective at
the close of business on the record date for such subdivision or combination.
The Warrant Price shall be proportionately increased or decreased, as the case
may be, in proportion to such increase or decrease, as the case may be, of
outstanding shares of Common Stock.

                  c. Upon any adjustment of the Warrant Price as hereinabove
provided, the number of shares of Common Stock issuable upon exercise of the
Warrants remaining unexercised immediately prior to any such adjustment, shall
be changed to the number of shares determined by dividing (i) the appropriate
Warrant Price payable for the purchase of all shares of Common Stock issuable
upon exercise of all of the Warrants remaining unexercised immediately prior to
such adjustment by (ii) the Warrant Price per share of Common Stock in effect
immediately after such adjustment. Pursuant to this formula, the total sum
payable to the Company upon the exercise of the Warrants remaining unexercised
immediately prior to such adjustment shall remain constant.

<PAGE>

                  d.    (i) If any capital reorganization or reclassification of
the capital stock of the Company, or consolidation or merger of the Company with
another corporation, person, or entity, or the sale of all or substantially all
of its assets to another corporation, person, or entity, shall be effected in
such a way that holders of Common Stock shall be entitled to receive stock,
securities, cash, property, or assets with respect to or in exchange for Common
Stock, and provided no election is made by the Company pursuant to subsection
(ii) hereof, then, as a condition of such reorganization, reclassification,
consolidation, merger or sale, the Company or such successor or purchasing
corporation, person, or entity, as the case may be, shall agree that the
registered holder of the Warrants shall have the right thereafter and until the
Termination Date to exercise such Warrants for the kind and amount of stock,
securities, cash, property, or assets receivable upon such reorganization,
reclassification, consolidation, merger, or sale by a holder of the number of
shares of Common Stock for the purchase of which such Warrants might have been
exercised immediately prior to such reorganization, reclassification,
consolidation, merger or sale, subject to such subsequent adjustments which
shall be equivalent or nearly equivalent as may be practicable to the
adjustments provided for in this Section 7.

                        (ii) Notwithstanding subsection (i) hereof and in lieu
thereof, the Company may elect by written notice to the registered holder
hereof, to require such registered holder to exercise all of the Warrants
remaining unexercised prior to any such reorganization, reclassification,
consolidation, merger or sale. If the holder of this Warrant shall not exercise
all or any part of the Warrants remaining unexercised prior to such event, such
unexercised Warrants shall automatically become null and void upon the
occurrence of any such event, and of no further force and effect. The Common
Stock issued pursuant to any such exercise shall be deemed to be issued and
outstanding immediately prior to any such event, and shall be entitled to be
treated as any other issued and outstanding share of Common Stock in connection
with such event. If an election is not made by the Company pursuant to this
subsection (ii) in connection with any such event, then the provisions of
subsection (i) hereof shall apply to such event.

<PAGE>

                  e. Whenever the Warrant Price and number of shares of Common
Stock subject to this Warrant is adjusted as herein provided, the Company shall
promptly mail to the registered holder of this Warrant a statement signed by an
officer of the Company setting forth the adjusted Warrant Price and the number
of shares of Common Stock subject to this Warrant, determined as so provided.

                  f. This form of Certificate need not be changed because of any
adjustment which is required pursuant to this Section 7. However, the Company
may at any time in its sole discretion (which shall be conclusive) make any
change in the form of this Certificate that the Company may deem appropriate and
that does not affect the substance hereof; and any Certificate thereafter
issued, whether in exchange or substitution for this Certificate or otherwise,
may be in the form as so changed.

            8. Reservation. There has been reserved, and the Company shall at
all times keep reserved out of the authorized and unissued shares of Common
Stock, a number of shares of Common Stock sufficient to provide for the exercise
of the right of purchase represented by the Warrants. The Company agrees that
all shares of Common Stock issued upon exercise of the Warrants shall be, at the
time of delivery of the Certificates for such Common Stock, validly issued and
outstanding, fully paid and non-assessable.

            9. Fractional Shares. The Company shall not issue any fractional
shares of Common Stock pursuant to any exercise of any Warrant and shall pay
cash to the holder of any Warrant in lieu of any such fractional shares.

            10. No Right. The holder of any Warrants shall not be entitled to
any of the rights of a shareholder of the Company prior to the date of issuance
of the Common Stock by the Company pursuant to an exercise of any Warrant.

            11. Securities Laws. As a condition to the issuance of any Common
Stock pursuant to the Warrants, the holder of such Common Stock shall execute
and deliver such representations, warranties, and covenants, that may be

<PAGE>

required by applicable federal and state securities law, or that the Company
determines is reasonably necessary in connection with the issuance of such
Common Stock. In addition, the certificates representing the Common Stock shall
contain such legends, or restrictive legends, or stop transfer instructions, as
shall be required by applicable Federal or state securities laws, or as shall be
reasonably required by the Company or its transfer agent.

            12. Registration Rights. No later than sixty days following the date
hereof, the Company shall prepare and file, at its sole cost and expense, and
thereafter use its best efforts to have declared effective, an appropriate
registration statement with the Securities and Exchange Commission registering
all of the shares of Common Stock underlying this Warrant certificate for resale
by the holder under the Act. The registration statement shall be prepared as a
"shelf" registration statement under Rule 415, and the Company shall use its
best efforts to have the registration statement maintained effective until the
earlier of (i) one year from the effective date thereof, or (ii) the date that
all of such Common Stock is resold pursuant to the registration statement or
otherwise.

            13. Transferability. Subject to compliance with applicable
securities laws, the Warrants represented by this Certificate and this
Certificate shall inure to the benefit of and be exercisable by any holder's
heirs, personal representatives, successors and assigns, and shall be fully
assignable and transferable by any holder at any time and from time to time,
including by will, intestacy or otherwise. Any such assignee or transferee shall
be entitled to all the benefits hereof and shall be the holder hereof.

            14. Applicable Law. The Warrants and this Certificate shall be
deemed to be a contract made under the laws of the Commonwealth of Pennsylvania
and for all purposes shall be construed in accordance with the laws thereof
regardless of its choice of law rules.

<PAGE>

            IN  WITNESS  WHEREOF,  USA  TECHNOLOGIES,  INC.,  has  executed  and
delivered this Warrant Certificate as of the date written below.

                                    USA TECHNOLOGIES, INC.

                                By:
                                    --------------------------------------------
                                    George R. Jensen, Jr.,
                                    Chief Executive Officer

                                Attest:
                                        ----------------------------------------
                                        Stephen P. Herbert,
                                        Secretary

Dated: ________, 2004

<PAGE>

USA TECHNOLOGIES, INC.
100 Deerfield Lane, Suite 140
Malvern, PA 19355
Attn:  George R. Jensen, Jr.,
       Chief Executive Officer

                              ELECTION TO PURCHASE

            The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the attached Warrant Certificate No. of the Company. The
undersigned desires to purchase shares of Common Stock provided for therein and
tenders herewith full payment of the Warrant Price for the shares of Common
Stock being purchased, all in accordance with the Certificate. The undersigned
requests that a Certificate representing such shares of Common Stock shall be
issued to and registered in the name of, and delivered to, the undersigned at
the address set forth in the attached certificate. If said number of shares of
Common Stock shall not be all the shares purchasable under the Certificate, then
a new Common Stock Warrant Certificate for the balance remaining of the shares
of Common Stock purchasable shall be issued to and registered in the name of,
and delivered to, the undersigned at the address set forth in the attached
certificate.

Dated: ______________, 2004            Signature:_______________________________Exhibit 4.35

THE COMMON STOCK  ISSUABLE  PURSUANT TO THIS  AGREEMENT HAS NOT BEEN  REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED,  OR ANY STATE  SECURITIES LAW. THE
COMMON STOCK ISSUABLE  PURSUANT TO THIS  AGREEMENT MAY NOT BE SOLD,  OFFERED FOR
SALE,  PLEDGED OR  HYPOTHECATED  IN THE ABSENCE OF A  REGISTRATION  STATEMENT IN
EFFECT UNDER SUCH ACT AND SUCH LAWS WITH  RESPECT TO THE COMMON  STOCK  ISSUABLE
PURSUANT TO THIS AGREEMENT, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.

                             USA TECHNOLOGIES, INC.
                         COMMON STOCK PURCHASE AGREEMENT

      This COMMON STOCK PURCHASE AGREEMENT is made this 18th day of June 2004 by
and between USA  TECHNOLOGIES,  INC., a Pennsylvania  corporation  ("USA" or the
"Company"), and STEVE ILLES ("ILLES" or "Investor").

                                   BACKGROUND

      As more  fully set forth  herein,  ILLES has agreed to  purchase  from the
Company  shares of Common Stock of the Company  ("Common  Stock") for a purchase
price not to exceed Seven  Million Five Hundred  Thousand  Dollars  ($7,500,000)
(the "Commitment Amount").

                                    AGREEMENT

      NOW THEREFORE,  intending to be legally bound hereby, the parties agree as
follows:

      1. Commitment. Subject to the terms and conditions hereof, ILLES agrees to
purchase from USA shares of Common Stock with an aggregate purchase price not to
exceed the Commitment  Amount. The aggregate number of shares of Common Stock to
be purchased by ILLES under this Agreement shall be as provided in Subsection D.
of this Section 1.

      During the Purchase Period (as defined below), ILLES shall be permitted to
purchase  Common Stock from the Company from time to time at his own election as
described  in  subsection  A. below,  and during the Put  Commitment  Period (as
defined  below)  ILLES shall be required to purchase  Common Stock from USA from
time to time  pursuant to the  election of USA as  described  in  subsection  B.
below.

<PAGE>

      A.  During the period of time from and after the date hereof and until the
first  annual  anniversary  of the  effectiveness  of the  Initial  Registration
Statement  (as  defined  referred  in  Section 7 hereof)  ("Purchase  Commitment
Period"),  ILLES shall be permitted to purchase Common Stock from the Company at
any time and from time to time at the price  per  share of Thirty  Cents  ($.30)
(the "Base Per Share Price").  ILLES shall purchase  Common Stock by delivery to
the Company  (prior to  expiration  of the  Purchase  Commitment  Period) of the
purchase  price for the Common Stock being  purchased  hereunder  (the "Purchase
Price"),  and the completed  Election To Purchase Form that is attached  hereto.
The Purchase  Price shall be paid by ILLES either in cash or by certified  check
or bank draft payable to the order of the Company.

      B. In addition to the right of ILLES to purchase  Common Stock at the Base
Per Share Price,  during the period of time from and after the  effectiveness of
the Initial  Registration  Statement  (as defined in Section 7 hereof) and for a
period of one year  thereafter  ("Put  Commitment  Period"),  USA shall have the
right at any time and from time to time during the Commitment  Period to require
ILLES to purchase  Common  Stock from the Company at the lower of the  following
price: (i) the Base Per Share Price (i.e., $.30), or (ii) 90% of the closing bid
price per share on the date prior to the date of the delivery by USA to ILLES of
the Commitment To Purchase Form described below. For example, if the closing bid
price of the shares on the  applicable  date was $.50,  then the exercise  price
would be the Base Per Share Price (i.e.,  $.30), and if the closing bid price of
the shares on the  applicable  date was $.20,  then the exercise  price would be
$.18.  USA shall  require  ILLES to purchase  Common Stock from USA hereunder by
delivery to ILLES  (prior to  expiration  of the Put  Commitment  Period) of the
completed  Commitment To Purchase Form that is attached hereto setting forth the
purchase  price  of  the  Common  Stock  to  be  purchased  by  ILLES  from  USA
("Commitment Purchase Price") and the aggregate number of shares to be purchased
by ILLES.  The  Commitment  Purchase  Price shall be delivered to the Company by
ILLES  within two business  days after  delivery to ILLES of the  Commitment  To
Purchase Form and shall be paid by ILLES either in cash or by certified check or
bank draft  payable to the order of the Company.  ILLES shall not be required by
USA to purchase  any Common  Stock from USA  pursuant to this Section 1.B unless
the Common Stock being purchased by ILLES from USA hereunder has been registered
for  resale  by  ILLES  under  the Act  pursuant  to an  effective  registration
statement, all in accordance with Section 7.

      C.  Notwithstanding  anything  else set forth  herein  during any calendar
month during the Commitment  Period,  or the Put Commitment  Period, as the case
may be, ILLES shall not  purchase(or be required by USA to purchase)  under this
Agreement Common Stock with an aggregate

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<PAGE>

purchase price of more than Seven Hundred Thousand  Dollars($700,000).

      D. The initial  number of shares of Common Stock subject to this Agreement
shall be 25,000,000.  In order to ensure that ILLES shall purchase  Common Stock
under this Agreement with a purchase  price of up to the Commitment  Amount,  at
any time and from  time to time  during  the  Purchase  Commitment  Period,  and
subject to the other terms and conditions of this Agreement,  USA shall have the
right to increase the number of shares of Common Stock covered by this Agreement
by notice to ILLES.

      E. USA shall pay to ILLES a due  diligence  fee in the amount of  $45,000.
The due  diligence  fee shall be  credited  by USA against the price for initial
shares of Common Stock purchased by ILLES hereunder.

      2. Share  Issuance.  Upon the payment of the Purchase  Price or Commitment
Purchase  Price as aforesaid,  the Company shall issue and cause to be delivered
with all reasonable dispatch to ILLES and in the name of ILLES, a certificate or
certificates  for the  number  of  shares of  Common  Stock so  purchased.  Such
certificate or certificates  shall be deemed to have been issued and ILLES shall
be deemed to have  become a holder of record of such  Common  Stock on and as of
the date of the delivery to the Company of and payment of the Purchase  Price or
Commitment  Purchase Price as aforesaid.  If, however, at the date of payment of
such Purchase  Price or Commitment  Purchase  Price,  the transfer books for the
Common  Stock shall be closed,  the  certificates  for the Common Stock shall be
issued and ILLES shall  become a record  owner of such Common Stock on and as of
the next date on which  such  books  shall be  opened,  and until  such date the
Company shall be under no duty to deliver any certificate for such Common Stock.

      3.  Representations by ILLES. ILLES represents and warrants to the Company
as follows:

           (a) ILLES has received,  read and  understands the provisions of each
           of the following:  (i) the Company's Annual Report on Form 10-KSB for
           the fiscal year ended June 30, 2003; (ii) the Company's Amendment No.
           1 to  Registration  Statement on Form SB-2 filed with the  Securities
           and Exchange  Commission on December 19, 2003 (File No.  333-110148);
           (iii) the Risk Factors section  incorporated  by reference  herein in
           Section 3(i) hereof;  (iv) the Company's  Form 10-QSB for the quarter
           ended  September  30,  2003;  (v) the  Company's  Form 10-QSB for the
           quarter ended December 31, 2003; (vi) the definitive  proxy statement
           of the Company filed with the SEC on December 15, 2003, and (vii) the
           Company's  Form 10-QSB for the quarter  ended March 31, 2004.  All of
           the  foregoing  together  with this  Agreement  shall be  referred to
           herein as "Offering Materials".

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<PAGE>

           (b)  ILLES  has  relied  only  upon  the  information  presented  and
           contained in the Offering Materials. ILLES has had the opportunity to
           ask of the person or persons  acting on behalf of the Company any and
           all relevant  questions in connection  with any aspect of the Company
           including,  but not  limited  to,  the  Common  Stock  offered by the
           Offering  Materials and has received answers which ILLES considers to
           be  reasonably  responsive  to  such  questions.  ILLES  has  had the
           opportunity  to verify the accuracy of the  information  contained in
           the Offering Materials.

           (c) ILLES  understands that ILLES is subscribing for the Common Stock
           without being  furnished  any  literature or prospectus in connection
           with the  Offering  other than the Offering  Materials,  and that the
           Offering of the Common Stock presented in the Offering Materials will
           not have been scrutinized by the securities  administrator or similar
           bureau, agency, or department of the state of my residence.

           (d)  ILLES  understands  (i)  that  the  Common  Stock  has not  been
           registered  under the Securities Act of 1933, as amended (the "Act"),
           or registered or qualified  under the securities laws of the state of
           my residence,  (ii) except as provided in Section 7 hereof, ILLES has
           no right to require such  registration  or  qualification,  and (iii)
           that  therefore  ILLES must bear the economic risk of the  investment
           for an indefinite  period of time because the Common Stock may not be
           sold unless so  registered  or qualified or unless an exemption  from
           such registration and qualification is available.

           Although  the Company has agreed to use its best  efforts to register
           for resale the Common Stock with the SEC, and to use its best efforts
           to keep such registration statement current and effective,  there can
           be no assurance  that such efforts  will be  successful.  In any such
           event,  the Common Stock would not be registered for resale under the
           Act,  and  could  only be  sold  in  reliance  upon  exemptions  from
           registration under the Act.

           (e) The Common  Stock is being  purchased  for ILLES' own account for
           investment purposes only and not for the interest of any other person
           and is  not  being  purchased  with a  view  to or  for  the  resale,

                                       4
<PAGE>

           distribution,  subdivision or fractionalization thereof. Although the
           Common Stock is currently  traded on the OTC Bulletin Board under the
           symbol  USTT,  ILLES  also  understands  that  there  may  not be any
           established public trading market for the sale of such securities.

           (f) ILLES is able to bear the economic  risks  related to purchase of
           the Common  Stock for an  indefinite  period of time (i.e.,  ILLES is
           able  to  afford  a  complete  loss  of the  Common  Stock  ILLES  is
           subscribing to purchase).  ILLES' net worth and assets are sufficient
           to enable  him to  purchase  shares of Common  Stock  from USA in the
           amount of the Commitment Amount pursuant to this Agreement.

           (g) ILLES' overall  commitment to  investments  which are not readily
           marketable  is  not  disproportionate  to  ILLES'  net  worth  and my
           investment  in the Company will not cause such overall  commitment to
           become excessive.

           (h) ILLES has adequate  means of providing  for ILLES'  current needs
           and possible personal contingencies.  ILLES has no need for liquidity
           of the Common  Stock  subscribed  to be  purchased  hereby and has no
           reason to  anticipate  any change in ILLES'  personal  circumstances,
           financial  or  otherwise,  which  might  cause or require any sale or
           distribution of such Common Stock subscribed to be purchased.

           (i) ILLES recognizes that the purchase of the Common Stock involves a
           high degree of risk including those special risks set forth under the
           caption "Risk Factors" and "Forward Looking  Statements" in Amendment
           No. 1 to the Form SB-2  Registration  Statement of the Company  filed
           with the  Commission  on December  19, 2003 (No.  333-110148)  all of
           which are incorporated herein by reference.

           (j) ILLES  understand  that ILLES' right to transfer the Common Stock
           will be restricted  as set forth on the  certificate  evidencing  the
           Common Stock. Such restrictions  include  provisions against transfer
           unless such  transfer is not in violation  of the Act, or  applicable
           state  securities laws (including  investor  suitability  standards).
           ILLES is familiar  with  Regulation M  promulgated  under the Act and

                                       5
<PAGE>

           agrees to comply  with his  obligations  thereunder  including  those
           relating to his status as an underwriter of the Common Stock.

           (k)  All  information   which  ILLES  has  provided  to  the  Company
           including,  but not limited to, financial position,  and status as an
           accredited investor,  and knowledge of financial and business matters
           is true,  correct and  complete as of the date of  execution  of this
           Agreement.  I  understand  that the  Company  will rely in a material
           degree upon the representations contained herein.

           (l)  ILLES  understands  that a legend  may be  placed  on any  stock
           certificate  representing  the  Common  Stock  substantially  to  the
           following effect:

THE SHARES  REPRESENTED BY THIS  CERTIFICATE  HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED,  OR APPLICABLE STATE SECURITIES STATUTES AND
REGULATIONS.  SUCH SHARES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT  FOR SUCH SHARES  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED,  OR
APPLICABLE STATE SECURITIES  STATUTES AND  REGULATIONS,  UNLESS,  IN THE OPINION
(WHICH  SHALL BE IN FORM  AND  SUBSTANCE  SATISFACTORY  TO THE  CORPORATION)  OF
COUNSEL SATISFACTORY TO THE CORPORATION, SUCH REGISTRATION IS NOT REQUIRED.

           (m)  ILLES  is an  "accredited  investor"  as  defined  in  Rule  501
promulgated  under the Act because  ILLES'  individual net worth (or ILLES joint
net worth with his spouse)on the date hereof exceeds $1,000,000.

           4.  Adjustments.  Subject  and  pursuant  to the  provisions  of this
Section 4, the Base Per Share Price shall be subject to adjustment  from time to
time only as set forth hereinafter:

                               a. In case the  Company  shall  declare  a Common
Stock  dividend  on the Common  Stock,  then the Base Per Share  Price  shall be
proportionately  decreased  as of the close of business on the date of record of
said Common Stock dividend in proportion to such increase of outstanding  shares
of Common Stock.

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<PAGE>

                               b. If the Company shall at any time subdivide its
outstanding  Common  Stock by  recapitalization,  reclassification  or  split-up
thereof, the Base Per Share Price immediately prior to such subdivision shall be
proportionately  decreased,  and, if the Company  shall at any time  combine the
outstanding  shares of Common Stock by  recapitalization,  reclassification,  or
combination  thereof,  the  Base  Per  Share  Price  immediately  prior  to such
combination shall be proportionately  increased. Any such adjustment to the Base
Per Share Price shall  become  effective  at the close of business on the record
date for such  subdivision  or  combination.  The Base Per Share  Price shall be
proportionately  increased or  decreased,  as the case may be, in  proportion to
such increase or decrease,  as the case may be, of outstanding  shares of Common
Stock.

                               c.  Whenever the Base Per Share Price is adjusted
as herein provided, the Company shall promptly mail to ILLES a statement setting
forth the adjusted  Base Per Share Price determined as so provided.

                     5.  Reservation.  There has been reserved,  and the Company
shall at all times keep reserved out of the  authorized  and unissued  shares of
Common Stock,  a number of shares of Common Stock  sufficient to provide for the
rights of purchase  represented by this  Agreement.  The Company agrees that all
shares of Common Stock issued hereunder shall be, at the time of delivery of the
certificates for such Common Stock,  validly issued and outstanding,  fully paid
and non-assessable.

                                       7
<PAGE>

                     6.  Securities  Laws. As a condition to the issuance of any
Common  Stock  pursuant  this  Agreement,  ILLES shall  execute and deliver such
representations,  warranties,  and covenants, that may be required by applicable
federal and state  securities law, or that the Company  determines is reasonably
necessary in connection with the issuance of such Common Stock. In addition, the
certificates  representing  the Common  Stock shall  contain  such  legends,  or
restrictive  legends,  or stop  transfer  instructions,  as shall be required by
applicable Federal or state securities laws, or as shall be reasonably  required
by the Company or its transfer agent.

                     7.  Registration  Provisions. No later  than June 30, 2004,
the Company shall prepare and file, at its sole cost and expense, and thereafter
use its best efforts to have declared  effective,  an  appropriate  registration
statement  with the Securities and Exchange  Commission  registering  all of the
25,000,000 shares of Common Stock initially covered by this Agreement for resale
by ILLES under the Act (the "Initial  Registration  Statement").  As provided in
Section 1.D hereof,  USA has the right from time to time to increase  the number
of shares of Common Stock to be covered by this  Agreement.  Any such additional
shares may be  included  in an  amendment  or  post-effective  amendment  to the
Initial  Registration  Statement,  or  in  a  separate  additional  registration
statement.

                     The term "registration  statement"  whenever and as used in
this Agreement shall mean and include for all purposes the Initial  Registration
Statement and any amendment or  post-effective  amendment thereto as well as any
additional  registration  statement or amendment  or post-  effective  amendment
thereto covering any Common Stock subject to this Agreement.

                     The registration  statement shall be prepared  as a "shelf"
registration  statement  under  Rule  415,  and the  Company  shall use its best
efforts  to have the  registration  statement  maintained  effective  until  the
earlier  of (i) one year from the  effective  date of the  Initial  Registration
Statement,  or (ii)  the date  that  all of the  Common  Stock  covered  by this
Agreement  is  resold  by  ILLES  pursuant  to  the  registration  statement  or
otherwise.

                     At the  Company's  request,  ILLES  shall  furnish  to  the
Company such  information  regarding  ILLES, the Common Stock held by ILLES, and
the intended  method of disposition of such Common Stock to the extent  required
to effect the  registration  of the Common Stock.  The Company shall include all
information  provided by ILLES pursuant  hereto in the  registration  statement,
substantially in the form supplied, except to the extent such information is not
permitted  by law.  ILLES  understands  and agrees that ILLES will be listed and
disclosed in the registration statement as an underwriter of the Common Stock as
such term is defined in Section  2(a)(11) of the Act and as such ILLES will have
liability, among other things, under Section 11 of the Act.

                     All expenses  (other than commissions and fees and expenses
of counsel to ILLES)  incurred in connection  with the  registration  statement,
including (without limitation) all registration,  filing and qualification fees,
printers'  and  accounting  fees,  fees and  disbursements  of  counsel  for the
Company, shall be borne by the Company.

                                       8
<PAGE>

          8.  Binding Effect. This Agreement shall be binding  upon the  party's
respective heirs, personal  representatives,  successors and assigns;  provided,
however,  that this  Agreement  shall not be  assignable by ILLES , including in
whole or in part, without the prior consent of the USA.

           9.  Indemnification.  In the  event any  shares  of Common  Stock are
included in a registration statement under this Agreement:

                     (a)       To the extent  permitted by law, the Company will
indemnify and hold  harmless  ILLES,  against any losses,  claims,  damages,  or
liabilities  to which ILLES may become  subject  under the Act,  the  Securities
Exchange Act of 1934, as amended (the "Exchange  Act")(or other federal or state
law,  insofar as such losses,  claims,  damages,  or liabilities  (or actions in
respect thereof) arise out of or are based upon any of the following  statements
or omissions: (i) any untrue statement or alleged untrue statement of a material
fact  contained  in  such  registration  statement,  including  any  preliminary
prospectus  or  final  prospectus   contained   therein  or  any  amendments  or
supplements thereto, or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make the statements
therein not  misleading,  and the Company will reimburse  ILLES for any legal or
other expenses  reasonably incurred by ILLES in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided, however,
that the indemnity  agreement  contained in this subsection 9(a) shall not apply
to amounts paid in settlement of any such loss,  claim,  damage,  liability,  or
action if such settlement is effected  without the consent of the Company (which
consent shall not be unreasonably withheld),  nor shall the Company be liable in
any such case for any such  loss,  claim,  damage,  liability,  or action to the
extent  that it  arises  out of or is based  upon a  violation  which  occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by ILLES;  provided  however,  that the
above shall not relieve the Company  from any other  liabilities  which it might
otherwise have.

                                       9
<PAGE>

                     (b) ILLES shall  indemnify  and hold  harmless the Company,
its directors and officers,  each underwriter and each other person, if any, who
controls  (within the meaning of the Act) the Company or such other  indemnified
party,  against any liability,  joint or several,  to which any such indemnified
party may become  subject  under the Act or any other  statute or at common law,
insofar as such  liability (or actions in respect  thereof)  arises out of or is
based upon (i) any untrue  statement or alleged untrue statement of any material
fact contained,  on the effective date thereof,  in any  registration  statement
under which securities were registered under the Act, any preliminary prospectus
or final prospectus  contained therein,  or any amendment or supplement thereto,
or (ii) any  omission or alleged  omission by ILLES to state  therein a material
fact required to be stated therein or necessary to make the  statements  therein
not  misleading,  to the  extent,  but  only to the  extent,  that  such  untrue
statement or alleged untrue  statement or omission or alleged  omission was made
in such registration  statement,  preliminary or final prospectus,  amendment or
supplement thereto in reliance upon and in conformity with information furnished
in writing to the Company by ILLES  specifically  for use  therein.  ILLES shall
reimburse any indemnified  party for any legal fees incurred in investigating or
defending any such liability.

                     (c) Promptly  after receipt by an  indemnified  party under
this  Section 9 of notice  of the  commencement  of any  action  (including  any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made  against any  indemnifying  party under this Section 9, deliver to
the  indemnifying  party a written  notice of the  commencement  thereof and the
indemnifying  party shall have the right to  participate  in, and, to the extent
the indemnifying  party so desires,  jointly with any other  indemnifying  party
similarly  noticed,  to  assume,  the  defense  thereof  with  counsel  mutually
satisfactory to the parties; provided,  however, that an indemnified party shall
have the right to retain its own counsel,  with the reasonably incurred fees and
expenses  of  one  such  counsel  to be  paid  by  the  indemnifying  party,  if
representation  of  such  indemnified  party  by  the  counsel  retained  by the
indemnifying party would be inappropriate due to actual or potential conflicting
interests between such indemnified party and any other party represented by such
counsel  in such  proceeding.  The  failure  to  deliver  written  notice to the

                                       10
<PAGE>

indemnifying  party within a  reasonable  time of the  commencement  of any such
action,  if materially  prejudicial to its ability to defend such action,  shall
relieve such indemnifying  party of any liability to the indemnified party under
this  Section  9,  but  the  omission  so  to  deliver  written  notice  to  the
indemnifying  party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section 9.

                     (d) In the event that the indemnity  provided in paragraphs
(a) and/or  (b) of this  Section 9 is  unavailable  to or  insufficient  to hold
harmless an  indemnified  party for any  reason,  the Company and ILLES agree to
contribute to the aggregate claims,  losses,  damages and liabilities (including
legal or other expenses  reasonably incurred in connection with investigating or
defending  same)  (collectively  "Losses") to which the Company and ILLES may be
subject in such  proportion as is  appropriate  to reflect the relative fault of
the Company and ILLES in  connection  with the  statements  or  omissions  which
resulted in such  Losses.  Relative  fault shall be  determined  by reference to
whether any alleged untrue statement or omission relates to information provided
by the  Company or by ILLES.  The  Company  and ILLES agree that it would not be
just and equitable if contribution were determined by pro rata allocation or any
other  method  of  allocation  that  does  not  take  account  of the  equitable
considerations  referred  to  above.  Notwithstanding  the  provisions  of  this
paragraph  (d), no person  guilty of  fraudulent  misrepresentation  (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution  from any
person who was not guilty of such fraudulent misrepresentation.  For purposes of
this  Section 9, each  person who  controls  the  Company  within the meaning of
either the Act or the Exchange Act and each  director and officer of the Company
shall have the same rights to contribution as the Company,  subject in each case
to the applicable terms and conditions of this paragraph (d).

                     (e) The  obligations  of the  Company  and ILLES under this
Section  9  shall  survive  the  resale,  if  any,  of  the  Common  Stock  in a
registration statement under this Agreement, and otherwise.

           10.  Applicable  Law. This Agreement shall be deemed to be a contract
made under the laws of the  Commonwealth  of  Pennsylvania  and for all purposes

                                       11
<PAGE>

shall be construed in accordance with the laws thereof  regardless of its choice
of law rules.

           11. Brokers and Finders. USA and ILLES hereby represent to each other
that no broker or  finder  has been  employed  or  engaged  by either of them in
connection  with the  transactions  contemplated  in this Agreement and that all
negotiations  relative to this Agreement  have been carried on directly  between
the parties hereto without the intervention of any other person.

           12. Survival of  Representations  and Warranties,  and Remedies.  All
representations  and warranties  contained in this  Agreement  shall survive the
execution and delivery of this Agreement.

           13.  Entire   Agreement.   This  Agreement   constitutes  the  entire
understanding  and  agreement  between  the parties  hereto with  respect to the
transactions  contemplated  herein,  supersedes  all prior  and  contemporaneous
agreements,  understandings,  negotiations  and  discussions,  whether  oral  or
written, of the parties,  and there have been no warranties,  representations or
promises,  written or oral,  made by any of the parties  hereto except as herein
expressly set forth herein.

           14. Waiver, Modification, etc.. Any party to this Agreement may waive
any of the terms or  conditions  of this  Agreement  or agree to an amendment or
modification  to this Agreement by an agreement in writing  executed in the same
manner (but not necessarily by the same persons) as this Agreement. No amendment
or modification of this Agreement shall be binding unless in writing executed by
all of the parties to this Agreement. No waiver of any of the provisions of this
Agreement  shall be deemed or shall  constitute a waiver of any other  provision
hereof  (whether or not similar),  nor shall any waiver  constitute a continuing
waiver unless otherwise expressly provided.

           15. Notice. Any notice or other communications  required or permitted
hereunder shall be sufficiently given: (i) three (3) business days after if sent
by certified mail, return receipt  requested,  postage prepaid,  or (ii) one (1)
business day after sent by Federal Express or other overnight  courier providing
delivery  confirmation for next business day delivery, or (ii) when delivered by

                                       12
<PAGE>

personal delivery, telecopier, or e-mail, in any event delivered to or addressed
as follows:

                     If to ILLES:

                               Mr. Steve Illes
                               8006 Southeast 167th Hilltop Loop
                               Villages, Florida 32162

                     If to USA:

                               USA Technologies, Inc.
                               Suite 140
                               100 Deerfield Lane
                               Malvern, Pennsylvania 19355
                               Attn: George R. Jensen, Jr., Chairman

           16.  Consent  to  Jurisdiction.  Each  of USA and  ILLES  irrevocably
consents and agrees that any legal action or proceeding  whatsoever  arising out
of or in any way connected with this Agreement or the transactions  contemplated
hereby may be  commenced,  filed,  instituted or brought in the state or federal
courts of the  Commonwealth  of  Pennsylvania,  and each of the  parties  hereto
irrevocably  submits  and  accepts  with  regard  to any such  legal  action  or
proceeding to the jurisdiction of such courts.  Each of the parties  irrevocably
consents  to service of process out of any of the  aforementioned  courts in any
such action or  proceeding  by the mailing of copies  thereof by  registered  or
certified mail, postage prepaid,  to the parties hereto,  such service to become
effective upon mailing.  Each of the parties hereto hereby irrevocably waive, to
the fullest extent  permitted by law, any objection which any of them may now or
hereafter  have to the  laying of the venue of any  suit,  action or  proceeding
arising out of or relating to this  Agreement or the  transactions  contemplated
hereby,  brought in such  Pennsylvania  courts,  and hereby further  irrevocably
waives  any  claim,  that any such suit,  action or  proceeding  brought in such
courts, has been brought in an inconvenient forum.

           17.  Counterparts.  This  Agreement  may be  signed  in  two or  more
counterparts which counterparts shall constitute a single,  integrated agreement
binding upon all the signatories to such  counterparts.  Delivery of an executed

                                       13
<PAGE>

counterpart  of this  Agreement  by  facsimile  shall be equally as effective as
delivery of a manually executed counterpart of this Agreement.

           18. Expenses.  Except as specifically provided otherwise herein, each
party hereto shall pay its or his own expenses  arising from this  Agreement and
the transactions contemplated hereby, including,  without limitation,  all legal
and accounting fees and disbursements;  provided,  however,  that nothing herein
shall  limit or  otherwise  modify  any right of the  parties  to  recover  such
expenses  (including  legal fees and costs of litigation)  from the other in the
event any party hereto breaches this Agreement.

           19. Further  Assurances.  Each of the parties hereto shall  hereafter
execute and deliver such further  documents and  instruments and do such further
acts and things as may be required or useful to carry out the intent and purpose
of this Agreement and as are not inconsistent with the terms hereof.

                                       14
<PAGE>

                     IN WITNESS  WHEREOF,  the parties  hereto have executed and
delivered this Common Stock Purchase Agreement on the date first written above.

                                          USA TECHNOLOGIES, INC.

/s/ Steve Illes                           By: /s/ George R. Jensen, Jr.
---------------                               --------------------------------
STEVE ILLES                                   George R. Jensen, Jr.,
                                              Chief Executive Officer

                                       15
<PAGE>

USA TECHNOLOGIES, INC.
100 Deerfield Lane, Suite 140
Malvern, Pennsylvania  19355
Attn:  George R. Jensen, Jr.,
       Chief Executive Officer

                              ELECTION TO PURCHASE

           STEVE  ILLES  hereby  irrevocably  elects  to  exercise  the right of
purchase  represented by the Common Stock Purchase Agreement between the Company
and ILLES. Pursuant thereto,  ILLES desires to purchase  _____________ shares of
Common Stock provided for therein and tenders  herewith full payment of the Base
Per  Share  Price  for the  shares  of  Common  Stock  being  purchased,  all in
accordance  with the Agreement.  ILLES requests that a Certificate  representing
such shares of Common  Stock shall be issued to and  registered  in the name of,
and delivered to, ILLES at the address set forth in the Agreement.

Dated:              , 2004
       -------------                         ----------------------------
                                             STEVE ILLES

                                       16

<PAGE>

Mr. Steve Illes
8006 Southeast 167th Hilltop Loop
Villages, Florida 32162

                             COMMITMENT TO PURCHASE

           Pursuant  to the Common  Stock  Purchase  Agreement  between  USA and
ILLES,  USA hereby  irrevocably  elects to require  ILLES to purchase  shares of
Common Stock provided for therein at the price of ___ per share, or an aggregate
of  $_________,  for  ____________  shares  of  Common  Stock.  Pursuant  to the
Agreement,  ILLES shall  deliver the  purchase  price for the shares  within two
business days. The certificate representing such shares of Common Stock shall be
issued to and  registered  in the name of,  and  delivered  to, the ILLES at the
address set forth in the Agreement.

Dated:              , 2004                   USA TECHNOLOGIES, INC.
       -------------

                                             By:
                                                 ------------------------------
                                                 Title:

                                       17

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