UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2001
OR
o 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
TRM CORPORATION
(Exact name of registrant as specified in its charter)
|
Oregon |
|
93-0809419 |
|
(State
or other jurisdiction |
|
(I.R.S. Employer Identification No.) |
|
|
|
|
|
5208 N.E. 122nd Avenue |
|
97230-1074 |
|
(Address of principal executive offices) |
|
(Zip Code) |
|
|
|
|
|
Registrant’s telephone number, including area code: (503) 257-8766 |
||
Securities registered pursuant to Section 12(b) of the Act:
None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock
(Title of each class)
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. Yes ý No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. o
As of March 1, 2002 the aggregate market value of the registrant’s Common Stock held by non-affiliates of the registrant was $10,225,379. Solely for purposes of this calculation, the registrant has treated its Board of Directors and executive officers as affiliates.
As of March 1, 2002 the number of shares of the registrant’s Common Stock outstanding was 7,059,790.
Documents incorporated by reference:
Parts of registrant’s Proxy Statement for the annual meeting of shareholders on June 4, 2002 are incorporated by reference into Part III of this report.
TRM CORPORATION
TABLE OF CONTENTS
|
Item
|
|
Page No. |
|
|
Part I |
|
|
|
|
|
|
1. |
1 |
|
|
2. |
5 |
|
|
3. |
5 |
|
|
4. |
6 |
|
|
4(a). |
6 |
|
|
5. |
Market for Registrant’s Common Equity and Related Stockholder Matters |
8 |
|
6. |
8 |
|
|
7. |
9 |
|
|
7(a). |
18 |
|
|
8. |
18 |
|
|
9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
19 |
|
10. |
20 |
|
|
11. |
20 |
|
|
12. |
Security Ownership of Certain Beneficial Owners and Management |
20 |
|
13. |
20 |
|
|
14. |
Exhibits, Financial Statement Schedules, and Reports on Form 8-K |
21 |
ITEM 1. BUSINESS
TRM Corporation delivers convenience services in retail environments to consumers. The Company currently provides self-service cash delivery and account balance inquiry, delivered through automatic teller machines (ATMs), and photocopy services delivered through TRM CopyCentersÔ. TRM’s convenience service locations are easily recognized by the Company’s distinctive yellow trapezoidal signage that has achieved significant consumer recognition.
As used in this Form 10-K, the terms “the Company” and “TRM” refer to TRM Corporation and its subsidiaries, unless the context specifies otherwise.
TRM’s convenience services are made available in high traffic retail locations that are convenient to consumers. TRM offers its services in over 31,000 retail locations in the United States, the United Kingdom, and Canada. TRM provides the equipment, maintenance, supplies, and point of sale materials required for each of its CopyCenter installations, while the retailer oversees the daily operation of the equipment, provides the necessary floor space and shares in the revenue generated by TRM’s offerings. The Company offers several programs to its ATM customers which include “full placement” programs or “self-fill” programs. A full placement program is one in which TRM provides for all equipment, maintenance, supplies, including the cash placed in the ATM, and point of sale materials. Self-fill programs require that the merchants provide for the cash inventory and labor required to maintain sufficient cash in the ATM, while TRM provides for the equipment, and point of sale materials. The Company’s base of installed ATMs includes TRM owned machines and a small number of leased machines. In the fourth quarter of 2001 TRM sold substantially all its assets of its French photocopy operation, including approximately 1,500 photocopiers.
The Company has developed long term contracts with its retail partners, such as grocery, drug, hardware, convenience stores and other retailers, and has entered into relationships with national and regional chain multi-site retailers such as Albertson’s, Eckerd Drugs, The Pantry, Bi-Lo, and international multi-site retailers that include Londis, Martins, Balfour, Couche-Tard, Depan-Escompt, and WalMart Canada.
The Company believes one of its strengths is the existence of a service and distribution system with both Company operated and service partner operated locations, from which equipment, supplies and parts, as well as office support services, are available to service technicians who provide support for the Company’s retail partners. As the result of this extensive service system, TRM is able to provide its customers prompt attention for emergency service requirements in addition to regularly scheduled maintenance.
TRM also provides a multi-lingual customer support call center that supports the English, Spanish, French, and German languages and is available to the Company’s customers domestically and abroad during their business hours. In addition, the Company’s virtual private network provides a secure communications channel to all of TRM’s personnel. This network provides a secure tunnel through the Internet that allows instant access to TRM’s I/T infrastructure, including ERP, Groupware, and Intranet applications. A local access telephone number allows Company representatives to securely link to the network at TRM’s world headquarters via their computer modems.
TRM has established a centralized support infrastructure at its headquarters located in Portland, Oregon, where it oversees the management of business and customer locations. This infrastructure oversees all the requirements of individual states and countries from accounting requirements, to human resources needs, and provides the necessary information systems and technology to conduct business on a global scale. All accounting, training, purchasing, billing and collection functions, as well as coordination of customer service, are centralized in the Company’s headquarters. Generally, the only personnel outside the Portland headquarters are service and sales personnel. TRM minimizes costs by buying large quantities of new photocopiers and by centrally purchasing parts, paper, and toner. The Company believes that its centralized operating systems and standardized operating procedures enable it to efficiently open in new geographic areas and to install and service thousands of TRM CopyCentersÔ.
The Company will continue to leverage its cost advantages by purchasing volumes which allow for cost effective price reductions. The Company is evaluating the cost effectiveness of decentralizing certain of its core functions relating to the United Kingdom. These core functions include accounting, purchasing and certain customer service functions. The Company intends to determine whether decentralization of certain functions could result in reduced costs by taking advantage of time zone differences, localized expertise surrounding statutory and management reporting requirements, and increased flexibility necessary to accommodate changing business model requirements.
1
During 2000, TRM established a majority owned subsidiary, iATMglobal.net, to develop and commercially establish the ability to deliver multiple products and services through the ATM distribution channel. TRM disposed of its interest in iATMglobal.net through a reorganization agreement completed on February 14, 2002. iATMglobal.net comprised a substantial portion of the e-Commerce segment of the Company, which contributed a substantial portion of the operating loss of the Company for 2001.
TRM believes its financial position at December 31, 2001 is sound due to a low amount of debt in relation to its asset base and the continued positive cash flow generated by its CopyCenterÔ business. At December 31, 2001, the Company has total long-term debt of $21.5 million compared to total assets of $88.7 million.
The Company was in compliance with the financial ratio covenants under its Loan Agreement with Bank of America N.A. at December 31, 2001. This agreement was amended on January 31, 2002, extending its credit facility through June 30, 2003. The Company expects its financial position will continue to allow for the implementation of its growth strategy related to its ATM business as discussed under the “Strategy” and “Products and Services” sections.
TRM’s is working to execute a business strategy which focuses on growing its ATM services business within the existing infrastructure while optimizing and sustaining the Company’s CopyCenterÔ service business.
In the near term, the Company intends to focus its activities on the CopyCenter business in the United States, Canada and the United Kingdom, and on the ATM business in the United Kingdom and United States.
TRM will also be assessing the possibility of expanding both its CopyCenter and ATM businesses into additional geographic areas in which it does not currently operate.
ATM Business
TRM entered the ATM business in 1999 in portions of both the United States and the United Kingdom. The Company entered the year 2001 with an installed base of 1,857 ATMs and expanded its installed machine base to 2,074 ATMs by December 31, 2001.
TRM ATMs provide cash delivery and balance inquiry services through various banking networks such as Cirrus, PLUS, Discover/Novus, and LINK, and with major credit card companies VISA, MasterCard, and American Express.
TRM was one of the early entrants in the United Kingdom convenience ATM market by being one of the first firms to offer convenience cash delivery and balance inquiry services at retail locations in the United Kingdom during 1999. The Company believes it is one of the largest ISO (independent system operators) or non-bank ATM deployers in the United Kingdom.
Cash delivery and balance inquiry services have been and are expected to be the major revenue drivers of this business. Past efforts to explore additional internet-based e-Commerce goods and services have been de-emphasized. The Company expects to continuously refine its product offerings in the ATM marketplace in both the United Kingdom and United States. The Company believes that the broadening interest for ATM placements in convenience locations will drive demand for lower cost business markets to service that market.
TRM expects to increase the number of retail locations where its cash delivery and balance inquiry services are offered by installing an estimated 2,600 new TRM ATM locations during fiscal year 2002. The Company believes that its position as an early entrant into the United Kingdom convenience ATM market presents significant business growth opportunity to be achieved in England, Scotland and Wales. The Company expects that the majority of its ATM placements in 2002 will be in that market. During fiscal year 2001, the Company engaged in an aggressive ATM asset management strategy designed to assess the profitability of certain of its installed ATM locations. This strategy resulted in the removal of a portion of its ATM installed base and the redeployment of those machines into higher transaction volume locations. This resulted in an overall number of installed machines in the US that was comparable to that of 2000. The UK experienced a net unit growth of approximately 200 machines. As the Company’s installed base of ATMs continues to mature, providing a basis for evaluating profitability, the Company expects to deploy its ATMs in accordance with historical profitability metrics.
2
Photocopiers
As of December 2001, TRM owned and maintained approximately 29,700 self-service CopyCentersÔ in retail establishments such as grocery retailers, pharmacies, stationery stores, hardware stores and gift shops located in 5 countries. TRM’s photocopy services include the installation, maintenance, and supply of photocopiers and the regular monitoring of their usage. Each TRM CopyCenterÔ consists of a photocopier, a machine stand, advertising signs, and in some cases, a coin-operated unit. Each retail business collects payment from its customers, shares in the revenue generated by the TRM Copy-CenterÔ and benefits from any increase in walk-in traffic. The Company invoices and collects payment from each retailer monthly.
TRM has become the leading provider in self-service photocopying in many of the markets it serves by focusing on service and convenience.
The Company services its CopyCentersÔ and provides all necessary supplies. The retail business supplies the space and electrical power for the TRM CopyCenterÔ and supervises its use. Consumers report the number of uses of the TRM CopyCenterÔ to the retail business cashier, who collects payment. Each month, the retail business keeps a percentage of the TRM CopyCenterÔ's revenue, generally based on a sliding scale related to usage as recorded by the TRM Copy CenterÔ's tamper-proof internal counter, and remits the remainder to TRM.
All accounting, training, purchasing, billing and collection functions, as well as coordination of customer service, are centralized in the Company’s headquarters in Portland, Oregon. Possible decentralization of certain functions necessary to support the growth of operations in United Kingdom is being considered. Generally, the only personnel outside the Portland headquarters are service and sales personnel. TRM minimizes costs by buying economic order quantities of new photocopiers and by centrally purchasing parts, paper, and toner. The Company believes that its centralized operating systems and standardized operating procedures enable it to efficiently open in new geographic areas and to install and service thousands of TRM CopyCentersÔ. The Company will continue to leverage its cost advantages by purchasing volumes that allow for cost-effective price reductions and by expanding its sourcing relationships to include lower cost providers.
Photocopy pricing is based on market competition, volume and retailer preference. Retail pricing decisions are made by the retailer based on the experience and recommendations of TRM for individual site pricing strategies.
The Company views the photocopy business as a mature business with limited opportunities for large-scale expansion. TRM intends to continue to manage the photocopy business by controlling growth in new and existing market areas. The Company expects to continue to evaluate new products and services that can be delivered to its core customer base and similar consumers.
In October 2001, the Company sold substantially all of the assets of its French operation including approximately 1,500 self service CopyCenters to a newly formed French entity, 81% owned by that operation’s former management team. The Company holds a 19% interest in the new entity. The restructuring resulted in a $1.5 million loss on disposal of these assets and the reversal of deferred tax assets associated with the French operations. Historically, the French operation had negatively effected the earnings of the Company.
Individuals seeking convenience photocopy services, cash delivery, and balance inquiry services have a variety of choices at banking locations and within retail establishments. The choices for photocopy services include specialty full-service business centers, copy and print shops, coin-operated photocopiers and other photocopiers located within retail shops. Each of these alternatives may to some extent compete with the Company. The Company does not attempt to compete directly with most alternative suppliers of photocopy services. Instead, the Company seeks to distinguish itself by blanketing its service areas with large numbers of convenient photocopiers and by providing high quality service to those locations.
Full-service business centers and copy and print shops generally serve a market more interested in high volume and sophisticated copying than in convenience of location.
Coin-operated photocopiers are sometimes located in retail establishments similar to TRM’s locations. While these coin-operated photocopiers provide a similar service to TRM CopyCentersÔ, the Company believes they do not pose a significant competitive threat to the majority of TRM’s retail customers.
The Company is aware of several self-service, non-coin-operated space photocopier businesses using the retail business concept. To the Company’s knowledge, each is limited to a relatively small geographic market and a relatively small number of photocopiers. Because of barriers to entry in the Company’s business, such as developing operating systems, establishing sources of supply, and achieving economies of scale, the Company does not believe any of these competitors currently represents a significant threat to the Company’s business.
3
Personal copiers provide a substitute for TRM CopyCentersÔ. While consumers are increasing ownership of personal copiers, the Company does not believe that this has a significant adverse effect on its business. The Company is unable to predict whether a technological or price breakthrough might increase sales of personal copiers and reduce demand for the Company’s copy services in the future.
The convenience cash delivery and balance inquiry market is, and is expected to remain, highly competitive. The Company’s principal competition is expected to come from national and regional banks, but the Company will also compete with other independent providers of cash delivery and balance inquiry services. The independent ATM business has become increasingly competitive, as entities other than banks have entered the market with relatively few barriers to entry. Currently, these competitors offer similar services to those offered by the Company.
Historically, the Company has experienced slightly higher than average CopyCenter revenue in the January-March and April-June quarters which coincide with tax season in the U.S. The Company experiences slightly lower than average CopyCenter revenues per retail location during July-September with European countries having extended holiday periods during this time of year. The Company continues to evaluate seasonality of its ATM convenience services business as its installed base continues to grow and mature. In reviewing historical ATM transaction volume levels, no clear seasonality trends have emerged.
TRM has procured substantially all of its ATMs under a strategic relationship with NCR. The Company purchases PC-based ATMs that it believes are best suited for deployment into retail environments and provides upgrade scalability for the future. The ATMs offer color display, PC-based architecture, thermal printing, and dial-up and remote monitoring capabilities. By working closely with NCR, TRM has developed its convenience cash access and balance inquiry services delivered through its ATMs that have the built-in ability to provide consumer access to e-commerce goods and services in the future at convenient locations.
In March 2000, the Company obtained a new source for vault cash inventory in its U.S. ATM network by establishing a $30.0 million financing facility to access a commercial paper conduit to provide vault cash for its ATM network. This agreement resulted in the removal of the cash and underlying bank borrowings from the Company’s balance sheet. The financing was completed off the Company’s balance sheet on a non-recourse basis. As such, the ATM vault cash inventory and related debt financing was removed from the balance sheet as of March 31, 2000.
TRM entered into the UK ATM market through a strategic banking relationship with Woolwich PLC to provide ATM services in the United Kingdom. Woolwich provided cash inventory and cash management services for all of TRM’s ATMs located in retail establishments in England, Scotland and Wales. In addition, Woolwich provided sponsorship into the LINK cash delivery network in the United Kingdom. In mid-2000, a change in regulations allowed TRM to be a direct member of LINK. As a result of this change, and Woolwich’s desire to exit the surcharging ATM market in the United Kingdom, TRM and Woolwich terminated their relationship in March 2001.
TRM entered into strategic relationships early in 2001 with Alliance & Leicester PLC and its affiliate, Girobank PLC to provide cash inventory and certain services to some of TRM’s ATM’s in the United Kingdom. This relationship also provides for co-branded machines with Alliance & Leicester, which is expected to be a significant source of growth for TRM in the UK ATM market.
TRM has maintained a strategic relationship with Konica since 1997. In the beginning of the relationship, Konica worked closely with TRM to develop the NextGenÔ photocopiers, which have now been installed in over 21,564 of the Company’s 29,707 CopyCenterÔ locations worldwide.
In addition to the establishment of these strategic partnerships, TRM has established relationships with parts suppliers, to assure that the needs of TRM’s customers can be met at all times by its service technicians. Based on these relationships with suppliers, the Company believes it has sufficient stock and resources at hand to assure that the needs of the business are met.
As of December 31, 2001, the Company had 429 employees, most of whom were full time. Two hundred twenty seven are in field service, and 202 are in sales, accounting, marketing, customer service, purchasing, billing, administration, training, and production and warehouse functions. None of the Company’s employees are represented by unions. The Company believes it has good relations with its employees.
4
Most TRM convenience locations are identified by distinctive yellow, green and black trapezoidal signs bearing “TRM ATM,” “Got cash?,” “Cash Machine,” “TRM Copies,” “TRM Photocopies.” In France, the Company operated under the name of FPC France Ltd. TRM and FPC’s signs are registered trademarks. The Company registered “NextGenÔ" as it relates to black and white technology photocopiers.
The Company’s two businesses, cash delivery and balance inquiry and photocopy services, are not subject to significant governmental regulation. Various regulations have been proposed to reduce or eliminate amounts charged to users (commonly referred to as surcharges or convenience fees) of ATMs. The enactment of such regulations would impact the profitability of individual convenience locations and may cause the Company to withdraw from markets in such jurisdictions. Occasionally, local zoning and sign regulations prohibit a retail business from displaying the Company’s signage on exterior walls or windows that identify a TRM convenience service location. In addition, local zoning or use restrictions may prohibit the Company from opening a convenience service location in an otherwise desirable retail business. These restrictions, however, are not expected to have a material adverse effect on the Company’s expansion plans.
The Company leases approximately 59,250 square feet of office and warehouse space for its team headquarters in Portland, Oregon. The leases expire in 2010, with options to renew for an additional five years. Such space is currently adequate for the Company’s business.
The Company leases warehouse space for 50 Service Center locations outside Portland, Oregon, in the USA and abroad. A Service Center location typically consists of approximately 2,000 to 7,000 square feet of office and warehouse space. The leases typically run for three to twelve years, some with extensions available upon exercise of renewal options. The Company does not anticipate any difficulty in locating or, if necessary, relocating Service Center locations.
Mr. Frederick Paulsell, a director of the Company, and certain members of his family have filed a lawsuit against Messrs. Edward Cohen and Daniel G. Cohen, also directors of the Company, ReadyCash Investment Partners, LP, a significant shareholder of the Company, and ReadyCash GP, Inc., the general partner of ReadyCash, and others, alleging that the defendants agreed to purchase one million shares of the Company’s common stock for $13 a share from Mr. Paulsell and his family members at or around the time of the investment transaction between ReadyCash and the Company in the spring of 1998. Mr. Paulsell and his family claim that Messrs. Edward Cohen and Daniel G. Cohen have breached this alleged agreement and the defendants are liable to Mr. Paulsell and his family members for damages of at least $12 million for breach of contract, common law fraud and securities fraud.
Messrs. Edward Cohen and Daniel G. Cohen and the other defendants have denied the allegations of Mr. Paulsell and his family members and have filed a counterclaim alleging common law fraud and securities fraud against Mr. Paulsell arising out of (1) Mr. Paulsell’s alleged failure to disclose his alleged agreement to sell his stock to the defendants and (2) Mr. Paulsell’s alleged failure to disclose certain alleged facts before the closing of the investment in TRM by ReadyCash Investment Partners, L.P. Mr. Paulsell has filed a motion to dismiss the defendants’ counterclaims. This motion is now pending before the court.
Messrs. Edward Cohen and Daniel G. Cohen, on the one hand, and Mr. Paulsell, on the other hand, have each sought indemnification by the Company for any liability arising out of the claims described above, including the costs of defense, and have requested that the Company reimburse them for expenses incurred to date. The Company has notified its insurance carrier of these claims, and the insurance carrier’s initial response is that Edward and Daniel Cohen’s claim would not be covered by the Company’s directors and officers insurance policy.
The Audit Committee of the Board of Directors of the Company informed Mr. Paulsell on February 15, 2002 that his request for indemnification and reimbursement of expenses was presently denied by decision of the disinterested members of Company’s Board of Directors.
The disinterested members of the Board of Directors of the Company have concluded that Edward and Daniel G. Cohen are entitled to reimbursement of defense costs up to $50,000 on a prospective basis. The Company has yet to reimburse the Cohens for any costs of defending the litigation.
5
On February 22, 2002 the Company commenced litigation against Mr. Paulsell asserting that if Mr. Paulsell made an agreement as he alleges in his lawsuit against the Cohens and others such an agreement usurped a corporate opportunity of TRM and constitutes common law fraud and breach of fiduciary duty and was wrongfully taken by Mr. Paulsell. Alternatively, if Mr. Paulsell’s allegations in his litigation against the Cohens are untrue, the Company’s suit alleges, then that litigation was initiated without foundation and knowing it would cause damage to the Company. The suit seeks a constructive trust in favor of the Company on the recovery, if any, by Mr. Paulsell resulting from his legal action described above.
No matters were submitted to a vote of security holders during the fourth quarter of fiscal year 2001.
The following table sets forth certain information with respect to the executive officers of the Company as of March 15, 2002.
|
Name |
|
Age |
|
Position |
|
Kenneth L. Tepper |
|
40 |
|
Chairman of the Board of Directors |
|
|
|
|
|
|
|
Daniel L. Spalding |
|
48 |
|
President |
|
|
|
|
|
|
|
Danial J. Tierney |
|
46 |
|
Senior Vice President, North America Business |
|
|
|
|
|
|
|
Gary M. Cosmer |
|
31 |
|
Vice President of Information Systems and Chief Technology Officer |
|
|
|
|
|
|
|
Bryan Clark |
|
42 |
|
Vice President of U.S. Business |
|
|
|
|
|
|
|
Rebecca J. Demy |
|
40 |
|
Corporate Controller |
Kenneth L. Tepper has served on the Board of Directors of the Company since June 1998 and was subsequently elected Chairman of the Board in June 2001. Previously, Mr. Tepper was President and CEO of USABancShares, a Federal Reserve bank holding company and BankPhiladelphia, an FDIC insured financial institution where he served from 1995 through 2000. Prior to 1995, Mr. Tepper served in a number of capacities within the financial institutions industry, including as Director of Merchant Banking for Eagle Bancshares in Atlanta, Georgia and as Corporate Counsel for Royal Bank of Pennsylvania. He is currently a Director of the Pennsylvania Industrial Development Authority (PIDA) and former Chairman of the Republican Party Finance Committee for the Commonwealth of Pennsylvania during the Ridge Gubernatorial campaign.
Daniel L. Spalding was appointed President in October 2001. Mr. Spalding joined the Company in April of 2000 as Chief Financial Officer and was promoted to Senior Vice President and Chief Financial Officer in May of 2001. Prior to joining TRM, Mr. Spalding was Senior Vice President of PacifiCorp, a diversified electric utility, since 1992, and Chairman and Chief Executive Officer of its Powercor Australia subsidiary since 1995. Mr. Spalding holds a B.B.A. degree from the University of Wisconsin-Whitewater.
Danial J. Tierney joined the Company in January of 1995 and was appointed Senior Vice President of Sales and Marketing in January 1999. He is currently Senior Vice President, North America Business. For 16 years prior to joining TRM, Mr. Tierney was employed by Spectra Physics Scanning Systems, Inc. and its affiliates in various locations and in positions of increasing responsibility, most recently in Eugene, Oregon, as Director of Marketing. He holds a B.S. degree from the University of California, Berkeley, and a M.B.A. from the University of Santa Clara.
Gary M. Cosmer was named Chief Information Officer and Vice President of Information Systems in February 1999. Prior to that and since December 1997, Mr. Cosmer served the Company as Director of Information Systems. Before joining TRM, Mr. Cosmer was a systems engineer for CTR Business Systems Corporation, a partner level Microsoft Solutions Provider. Before joining CTR Business Systems, Mr. Cosmer served as Service and Training Manager for Lucky Distributing, a privately held distribution company. Mr. Cosmer holds a B.S. degree in Advanced Technology Studies and an A.A.S. degree in Aviation Technology from Southern Illinois University.
Bryan R. Clark was appointed Vice President of Photocopy Business in January 2000, and is currently Vice President of U. S. Business. He joined TRM in March of 1997 as a Regional Sales Manager and was promoted to U.S. Director of Sales in April of 1999. Mr. Clark spent the first few years of his career as an accountant in the oil and gas industry. From 1986 to
6
February 1997, Mr. Clark worked as a broker, financial planner and sales manager for Merrill Lynch. Mr. Clark holds B.A. degrees in both Finance and Accounting.
Rebecca J. Demy joined the Company in July 1999 and as the Corporate Controller was elected officer of the Company in January 2002. Before joining the Company, Ms. Demy spent two years at Planar Systems, Inc, a high technology manufacturer of flat panel displays as Accounting Manager. Prior to that, she was an Audit Senior at KPMG, LLP in Portland, Oregon where she earned CPA certification in 1997. She has held accounting positions with various companies and with increasing responsibility for over 11 years. Ms. Demy holds a BBA degree from the University of Portland.
7
The Company’s Common Stock has been traded on the NASDAQ National Market System since December 18, 1991 under the symbol TRMM.
At March 1, 2002 there were 248 shareholders of record of the Company’s Common Stock and 7,059,790 shares were outstanding. The Company believes the number of beneficial owners is substantially greater than the number of record holders because a large portion of the Company’s outstanding Common Stock is held of record in broker “street names” for the benefit of individual investors.
The Company did not pay any dividends related to common stock in fiscal years 1999, 2000, or 2001. The Company intends to retain future earnings for use in its business and therefore does not anticipate paying cash dividends to Common Stock shareholders in the foreseeable future. The Company paid Series A Preferred Stock dividends of $1.5 million in fiscal year 1999, and $1.1 million during fiscal year 2000. The Company ceased paying dividends on the Series A Preferred Stock late in year 2000. At December 31, 2001 the Company had $1,877,000 in accrued Series A Preferred Stock dividends.
The Company’s amended loan agreement prohibits the payment of preferred dividends except dividends payable in the form of additional preferred shares of the Company’s’ stock (see “Liquidity and Capital Resources”). The Company does not anticipate the payment of preferred dividends in the form of additional shares of preferred stock.
Common Stock Price History
The following table sets forth the high and low sale prices for the Company’s common stock in each of the last 8 quarters as reported by the NASDAQ National Market System.
|
|
|
High |
|
Low |
|
||
|
2000 |
|
|
|
|
|
||
|
1st Quarter |
|
$ |
7.063 |
|
$ |
6.813 |
|
|
2nd Quarter |
|
$ |
7.000 |
|
$ |
4.750 |
|
|
3rd Quarter |
|
$ |
6.000 |
|
$ |
2.031 |
|
|
4th Quarter |
|
$ |
3.500 |
|
$ |
0.563 |
|
|
|
|
|
|
|
|
||
|
2001 |
|
|
|
|
|
||
|
1st Quarter |
|
$ |
2.875 |
|
$ |
1.000 |
|
|
2nd Quarter |
|
$ |
2.050 |
|
$ |
||