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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
[Fee Required]
For the fiscal year ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[No Fee Required]
For the transition period from _______________ to _______________
Commission File Number 0-19657
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TRM COPY CENTERS CORPORATION
(Exact name of registrant as specified in its charter)
Oregon 93-0809419
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
5208 N.E. 122nd Avenue
Portland, Oregon 97230-1074
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (503) 257-8766
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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 [ X ] No [ ]
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. [ ]
As of July 31, 1997 the aggregate market value of the registrant's Common
Stock held by non affiliates of the registrant was $54.9 million. Solely for
purposes of this calculation, the registrant has treated its Board of Directors
and Executive Officers as affiliates.
As of July 31, 1997, the number of shares of the registrant's Common Stock
outstanding was 6,940,041.
Documents incorporated by reference:
Parts of registrant's 1997 Annual Report to Shareholders are incorporated
by reference into Part II of this Report, and parts of registrant's Proxy
Statement for the annual meeting of shareholders on October 28, 1997 are
incorporated by reference into Part III of this report.
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PART I
ITEM 1. BUSINESS
General
As of August 1997, TRM Copy Centers Corporation owned and maintained nearly
35,000 self-service photocopiers in retail establishments such as pharmacies,
stationery stores, hardware stores and gift shops in 73 metropolitan areas: 50
in the U.S., five in Canada, 15 in the U.K, two in France and one in Belgium.
TRM installs, maintains and supplies its photocopiers and regularly monitors
their usage. Each retail business collects payment from its customers, shares in
the revenue generated by the Copy Center and benefits from any increase in
walk-in traffic. The Company invoices and collects payment from each retailer
monthly.
Each Copy Center consists of a photocopier, a machine stand and advertising
signs. Copy Centers are identifiable by the Company's trapezoidal yellow and
black "TRM Copies" signs.
TRM became the leading provider in self-service photocopying in many of the
metropolitan areas it serves by focusing on service and convenience. The Company
strives to conveniently locate high numbers of TRM Centers throughout its
service areas. Operations by geographic area are presented in Note 12 to the
Consolidated Financial Statements included in the Annual Report to Shareholders.
The Company services its TRM Centers and provides all necessary supplies.
The retail business supplies space and electrical power for the TRM Center and
supervises its use. Consumers report the number of uses of the TRM Center to the
retail business cashier, who collects payment. Each month, the retail business
keeps a percentage of the TRM Center's revenue, which generally is based on a
sliding scale related to usage, as recorded by the TRM Center'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
offices in Portland, Oregon. Generally, the only personnel outside the Portland
offices are service and sales personnel. TRM minimizes costs by buying large
quantities of new photocopiers, by rebuilding used photocopiers and by centrally
purchasing large quantities of parts, paper and toner. The Company believes that
its centralized operating systems and standardized operating procedures enable
it to efficiently open new geographies and to install and service thousands of
TRM Centers.
The Company is an Oregon corporation formed in 1982. From the end of fiscal
1992 through June 30, 1997, TRM opened operations in 18 U.S., three Canadian, 15
U.K., two French and one Belgian metropolitan areas.
As used in this Annual Report, the terms "the Company" and "TRM" refer to
TRM Copy Centers Corporation and its subsidiaries, unless the context requires
otherwise.
Locations
Historically, TRM has focused its sales efforts on a small retail
businesses. During fiscal year 1997 and going forward, the Company is expanding
its corporate chain selling program to better address the retail industry as it
continues to consolidate. The installed customer base is diversified such that
no retail business accounts for a significant portion of revenues or profits.
Further, TRM has diversified geographically to avoid dependence on one or more
market areas. The Company does not believe that the presence of significant
competition in any single geographic market would have a material adverse effect
on the Company.
As of June 30, 1997 the Company has established a local Service Center in
51 major metropolitan areas. Each of these Service Centers consists of leased
premises generally staffed by a service manager and one or more service
technicians and salespeople. TRM locates its Service Centers in sites convenient
to the TRM Centers. Service Centers include a small warehouse for the storage of
photocopiers, other components, spare parts, paper and toner. Eighteen of the
most recently opened metropolitan areas (called "satellites") were opened with
resources from existing Service Centers nearby and do not have stand-alone
facilities. Further, the Company also has three small Service Centers where the
service manager is the only technician. These small Service Centers are based in
the managers' homes.
Expansion
TRM installed 9,233 additional TRM Centers, net of replacements and
removals, from July 1, 1994 to June 30, 1997. In addition to installing 3,077
net TRM Centers in fiscal 1997, the Company focused on improving the profit
2
performance of the installed base of machines. During fiscal 1998, the Company
plans to add between 3,000 and 4,000 additional TRM Centers in existing market
areas and in new areas, and to continue to actively manage its installed base.
The Company's planned expansion will require an increase in the number of
installed photocopiers, Service Centers, service technicians, salespeople and
customers. TRM uses both new and used photocopiers to fulfill the requirements
of its expansion strategy. As of July 31, 1997, TRM had over 3,000 uninstalled
photocopiers in its system (see "Photocopiers"), which along with the purchase
of new machines are slotted for its expansion. The Company is purchasing new
machines to use in high-volume, independent and chain locations (see discussion
of NextGen under "New Products and Services Under Development"). The Company
will open a new Service Center in each new geographic market as it is justified.
The service technicians needed for the planned expansion will be trained at
TRM's Technology Center in Portland. TRM sells the TRM Center concept to retail
businesses through sales lead generation programs and local door-to-door
solicitation using independent and Company sales representatives and service
technicians. The Company is increasing its corporate sales efforts directed
toward regional and country-wide retail chains.
The Company has a program called "service selling" in selected North
American cities. The program trains and rewards service technicians to sell the
TRM program in their service areas. Field sales responsibilities and field
operations are grouped together under the Chief Operating Officer. This allows
for the sharing of management teams across the expanse of North America and for
a coordinated effort to grow market share in established cities, particularly in
North America.
In actively managing the profit performance of the installed base,
under-performing machines are removed and put back into stock to be redeployed
at site which offer greater profit potential. Machines that are under-priced for
the supporting copy volume are repriced to higher levels. During fiscal 1996 and
1997, machines were relocated and copy prices were raised at thousands of
locations.
The Company intends to continue to focus on its core photocopy business
with controlled growth from new and existing U.S. market areas, international
expansion and new products and services that can be delivered to its core
customer base and similar consumers.
New Products and Services Under Development
The Company is positioned to add other products or services to further
optimize the use of its in-place network of sales, service, distribution and
support as well as its growing installed customer base. Although sales generated
from additional products currently represent less than 5% of the total sales,
the Company is actively testing multiple new products and services.
During 1997, the Company concluded a twenty-month effort to select a new
technology black and white copier ("NextGen") for further unit growth. NextGen
is an important element in TRM's core programs for high-volume, independent
retailer locations and larger retail chains. TRM's existing base of installed
copy machines will continue to be used for the majority of convenience copying
locations.
Additional investments were made during 1997 in designing an add-on
electronic and receipt printing module for the Company's photocopiers, which
allows for stepped volume pricing (e.g., the first copy for 10(cent), copies 2-5
for 7(cent), etc.) . Market testing began during fiscal 1997 and is expected to
continue in fiscal 1998. Also in 1997, the Company expanded its initial test of
retailer-serviced coin-operated convenience copying with large format chain
stores, where TRM's service quality and worldwide infrastructure is a key
advantage, but where host cashiering is not a desired benefit. The Company also
expanded its initial trial for marketing prepaid telephone cards (to our base of
retailers).
TRM's intent is to invest in developing and market testing these and other
new products and services to identify those that clearly deserve to become
country or system-wide offerings. TRM has had in place about 400 full-color
copiers since 1992. While the Company does not intend to expand the number of
Color Copy Centers during fiscal 1998, it is possible that the color program
will be expanded at some point in the future.
Competition
A person seeking photocopy services has a variety of alternatives to a TRM
Center. These alternatives include specialty full-service business centers and
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.
3
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 smaller retail
establishments similar to TRM's locations. While these coin-operated
photocopiers provide an alternative to Copy Centers, the Company believes that
they do not pose a significant competitive threat to the majority of TRM's
retailers. As indicated under the caption "New Products and Services Under
Development," the Company is testing coin-operated copying with major large
format chains and retail stores, which have not been targeted by TRM up to the
present time.
The Company is aware of several self-service non-coin-operated 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.
Personal copiers provide a substitute for Copy Centers. While these
photocopiers have been on the market for a number of years, the Company does not
believe that they have had 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.
Computers with printers allow convenient production of multiple copies. The
Company does not believe that computer printing will have a significant adverse
effect on its Copy Center business. At present, computer duplicating is
primarily used only for a document which is electronically resident on that
particular computer and not for other paper originals. Both computer printers
and personal copiers currently have per copy costs to the user which are similar
to or higher than TRM's retail copy prices so they are not, in general, a lower
cost alternative.
Quarterly Seasonality
Historically, the Company has experienced slightly higher than average
production per TRM Center in its third and fourth fiscal quarters and slightly
lower than average production per TRM Center in its first fiscal quarter.
Photocopiers
As of August 1997, TRM owned more than 38,000 new and used photocopiers.
Nearly 35,000 of these photocopiers were revenue-producing Copy Centers in the
field. Generally, new photocopiers are shipped direct from the manufacturer to a
TRM Service Center. Used photocopiers are generally rebuilt at the Company's
rebuilding facility in Portland, Oregon. The Company expects to continue to use
both new and used photocopiers to expand its black and white copying business.
Supply
To date in North America, the Company has primarily used two similar
discontinued models of used photocopiers originally manufactured by Ricoh
Company, Ltd. and its affiliates. TRM bought these photocopiers from photocopier
brokers and dealers. These two models of black and white photocopiers have not
been manufactured since 1979 and 1982. During fiscal 1993, TRM developed a
supply relationship with Mita Copystar America, Inc. (Mita), for black and white
photocopiers and related products in North America. The resulting arrangement,
as updated, contains no commitment to purchase any specific number of
photocopiers. Subsequent to fiscal 1997 year end, the Company finalized an
agreement with a major manufacturer for new, state-of-the-art black and white
"NextGen" photocopiers in North America.
During fiscal 1992, the Company developed a supply relationship with Ricoh
Corporation (Ricoh) for full-color photocopiers and related products. TRM is not
currently adding to its inventory of full-color copiers. Ricoh ships related
products directly to the appropriate TRM Service Center as directed by the
Company. The Company will continue to monitor and evaluate models of full-color
photocopiers available for its use.
Also during fiscal 1992, a supply arrangement was entered into with Mita
Europe B.V. (Mita Europe) for black and white photocopiers and related products
in Europe. Under this arrangement, photocopiers and related products are shipped
from Mita Europe directly to the Company's European Service Centers. The Company
continues to monitor and evaluate supplies of new and used photocopiers in
Europe available for its use.
Few of TRM's photocopiers have ever become mechanically obsolete. Because
of their simplicity, the Company believes that its photocopiers are more
dependable than many other models.
4
Parts
The Company acquires a majority of the parts for its used photocopiers
directly from various parts fabricators. Many parts are built to TRM's
specifications. While TRM's strategy is to use multiple sources for its parts to
reduce dependence on single sources, some parts are purchased from single
sources. Temporary shortages, increased costs and quality control problems could
result if parts from a single or limited source became unavailable. Currently,
parts for the Mita photocopiers and the Ricoh full-color photocopiers are being
supplied primarily by the photocopier manufacturers. The Company will continue
to evaluate available sources of supply for parts.
Paper
Photocopy paper is purchased centrally by the Company's corporate offices
and then shipped directly from the mills to the Service Centers. A number of
paper companies are capable of producing the paper usable by the Company. The
Company believes that sufficient paper should be available to supply the
Company's expanding business.
Toner
The Company currently purchases liquid toner for its North American black
and white rebuilt photocopiers directly from two manufacturers. The Company has
confirmed that other acceptable sources are available and could obtain suitable
toner on reasonable terms from other manufacturers, although some start-up
delays could occur. Currently, toner for the Mita photocopiers and the Ricoh
full-color photocopiers is being supplied primarily by the photocopier
manufacturers. The Company will continue to evaluate available sources of supply
for toner.
Employees
As of June 30, 1997, the Company had approximately 667 employees, most of
whom were full-time. Approximately 419 are in field service, 189 are in sales,
marketing, customer service, purchasing, billing and administration, and 21 are
in training, production and warehouse functions. None of the Company's employees
are represented by unions. The Company believes it has good relations with its
employees. The Company currently engages about 38 independent contractors to
sell the TRM program.
Service Marks
Most Copy Centers are identified by distinctive yellow and black
trapezoidal signs bearing "TRM Copies" and "TRM Color Copies", and the program
price. In France and Belgium, the Company does business under the names of FPC
France Ltd. and FPC Belgium Limited, respectively. Most of TRM and FPC's signs
are registered service marks.
Copy Centers Investment Group, Ltd.
The Company serves as general partner of Copy Centers Investment Group,
Ltd., an Oregon limited partnership. The partnership was formed in 1983 to
acquire certain Copy Centers from the Company. The partnership owns 79 Copy
Centers in the states of Oregon and Washington. The Company receives a
management fee of 25% of the gross revenue from these 79 Copy Centers, plus $20
per month for each of the 79 locations for accounting and administrative
functions. The Company also owns a 1% interest in the profits and losses of the
partnership. The partnership will terminate December 31, 1998 according to the
partnership agreement. The partnership's operations do not constitute a material
part of the business of the Company.
Governmental Regulation
The Company is not subject to significant governmental regulation. Local
zoning and sign regulations occasionally prohibit a retail business from
displaying the "TRM Copies" sign on an exterior wall or window. Local zoning and
use restrictions may not allow opening a Copy Center in an otherwise desirable
retail business. The Company does not expect such restrictions to have a
material adverse effect on the Company's expansion plans.
Forward-Looking Statements
This Form 10-K includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 relating to the Company's plans or expectations as to:
future performance; growth opportunities; expansion; improvements in
efficiencies and cost controls; new products and services; repricing machines;
competition; paper costs and capital expenditures. The following factors are
among the factors that could cause actual results to differ materially from the
forward-looking statements: business conditions in the market areas in which the
Company operates; competitive factors; customer demand for the Company's
services and the Company's
5
ability to execute its plans successfully. Any forward-looking statements,
including other written or oral forward-looking statements made by the Company
or persons acting on its behalf, should be considered in light of these factors
and other factors referred to from time to time in the Company's press releases,
periodic reports or communications with shareholders.
ITEM 2. PROPERTIES
The Company leases approximately 25,750 square feet of office space for its
corporate offices in Portland, Oregon. The lease expires in 2010, with an option
to renew for an additional five years. The Company leases 31,500 square feet for
training, rebuilding, warehousing, the Portland Service Center and other office
space under a lease that also expires in 2010. This facility is located next to
the corporate offices.
The Company leases warehouse space for 50 Service Centers outside Portland,
Oregon. A Service Center typically consists of approximately 2,000 to 7,000
square feet of non-custom 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 Centers.
ITEM 3. LEGAL PROCEEDINGS
The Company is subject to various claims and legal proceedings from time to
time in the ordinary course of its business. There are no pending or threatened
matters which in the Company's opinion would have a material effect on the
Company's operations or its financial condition.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
Not applicable.
6
PART II
The information required by Part II is incorporated herein by reference
from the TRM Copy Centers Corporation 1997 Annual Report to Shareholders as
indicated below. Except for such information, the 1997 Annual Report to
Shareholders is not to be deemed filed as part of this Report.
Annual Report
Page No.
-------------
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND Inside back
RELATED STOCKHOLDER MATTERS cover
ITEM 6. SELECTED FINANCIAL DATA 1
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 5-7
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTAL DATA 8-18
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
Not applicable.
PART III
The information required by Part III is incorporated herein by reference
from the indicated pages of the Company's definitive Proxy Statement dated
September 12, 1997 for its 1997 annual meeting of shareholders.
Proxy
Statement
Page No.
---------
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT 3-5
ITEM 11. EXECUTIVE COMPENSATION 6-9
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT 1-2
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 5
7
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON
FORM 8-K
(a) 1. Financial Statements (incorporated by reference Annual Report
from the Company's 1997 Annual Report to Page No.
Shareholders): -------------
Consolidated Balance Sheets as of June 30, 1997
and 1996 8
Consolidated Statements of Operations for each
of the three years in the period ended June 30,
1997 9
Consolidated Statements of Stockholders' Equity
for each of the three years in the period ended
June 30, 1997 10
Consolidated Statements of Cash Flows for each
of the three years in the period ended June 30,
1997 11
Notes to Consolidated Financial Statements 12-18
Independent Auditors' Report 19
Form 10-K
Page No.
---------
2. Financial Statement Schedules:
Consent and Independent Auditors' Report on
Financial Statement S-1
Schedule VIII -- Valuation and Qualifying Accounts S-2
All other schedules are omitted because they are not applicable or
the required information is shown in the financial statements or
notes thereto.
3. Exhibits:
The exhibits listed in the Index to Exhibits, which appears on page
10 herein, are filed as part of this Annual Report.
(b) No reports on Form 8-K were filed by the Company during the last
quarter of fiscal 1997.
8
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized, in Portland, Oregon,
on September 12, 1997.
TRM COPY CENTERS CORPORATION
By: /s/ FREDERIC P. STOCKTON
-------------------------------------
Frederic P. Stockton
President and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Frederic P. Stockton his
attorney-in-fact, with the power of substitution, for him in any and all
capacities, to sign any amendments to this Report, and to file the same, with
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
said attorney-in-fact, or his substitute or substitutes, may do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on September 12, 1997 on
behalf of the Registrant and in the capacities indicated:
Signature Title
- ---------------------------------- ----------------------------------
/s/ FREDERIC P. STOCKTON President, Chief Executive Officer
- ---------------------------------- and Director
Frederic P. Stockton
/s/ FREDERICK O. PAULSELL Chairman of the Board and Director
- ----------------------------------
Frederick O. Paulsell
/s/ EDWIN S. CHAN Vice-Chairman of the Board and Director
- ----------------------------------
Edwin S. Chan
/s/ SHERMAN M. COE Director
- ----------------------------------
Sherman M. Coe
/s/ RALPH R. SHAW Director
- ----------------------------------
Ralph R. Shaw
/s/ MICHAEL D. SIMON Director
- ----------------------------------
Michael D. Simon
/s/ DONALD L. VAN MAREN Director
- ----------------------------------
Donald L. Van Maren
9
EXHIBIT INDEX
Exhibits
- --------
3.1 Restated Articles of Incorporation (Incorporated herein by
reference to Exhibit 3.1 of Form 10-K for the fiscal year
ended June 30, 1992)
3.2 Restated Bylaws
4.1 Articles V, VI and VII of the Restated Articles of
Incorporation (See Exhibit 3.1)
4.2 Articles I, II, V, VII and X of the Restated Bylaws, as
amended (See Exhibit 3.2)
10.1 Form of Indemnity Agreements with Registrant's directors and
executive officers
10.2 Loan Agreement with United States National Bank of Oregon,
dated March 31, 1997
10.3 a) Lease dated October 14, 1991 between Pacific Realty
Associates, L. P. and Registrant (for Registrant's
training facility in Portland, Oregon) (Incorporated
herein by reference to Exhibit 10.7 of Form S-1 dated
November 8, 1991 [No. 33-43829])
b) Lease amendment dated February 7, 1994, between Pacific
Realty Associates, L.P. and Registrant (Incorporated
herein by reference to Exhibit 10.7 of Form 10-K for the
fiscal year ended June 30, 1994)
c) Lease amendment dated August 10, 1994, between Pacific
Realty Associates, L.P. and Registrant (Incorporated
herein by reference to Exhibit 10.5 of Form 10-K for the
fiscal year ended June 30, 1995)
d) Lease dated August 10, 1994 between Pacific Realty
Associates, L.P. and Registrant (for the Registrant's
corporate headquarters in Portland, Oregon)
(Incorporated herein by reference to Exhibit 10.4 of
Form 10-K for the fiscal year ended June 30, 1995)
10.4 Restated 1986 Stock Incentive Plan (Incorporated herein by
reference to Exhibit 10.8 of Form 10-K for the fiscal year
ended June 30, 1994)
10.5 1996 Stock Option Plan
10.6 Employee Stock Purchase Plan (Incorporated herein by
reference to Exhibit 28.1 of Form S-8 dated December 7, 1992
[No. 33-55370])
10.7 Form of Stock Option Agreements:
a) For option grants before fiscal 1994 (Incorporated
herein by reference to Exhibit 10.9 of Form S-1 dated
November 8, 1991 [No. 33-43829])
b) For option grants during fiscal 1994 (Incorporated
herein by reference to Exhibit 10.10 of Form 10-K for
the fiscal year ended June 30, 1994)
c) For option grants during fiscal 1995 (Incorporated
herein by reference to Exhibit 10.8 of Form 10-K for the
fiscal year ended June 30, 1995)
10.8 Employment Agreements:
a) Employment Agreement dated January 17, 1995 with Michael
D. Simon (Incorporated herein by reference to Exhibit
10.9 of Form 10-K for the fiscal year ended June 30,
1995)
b) Employment Agreement dated April 25, 1996 with Michael
D. Simon (Incorporated herein by reference to Exhibit
10.9 of Form 10-K for the fiscal year ended June 30,
1996)
c) Employment Agreement dated August 18, 1997 with Frederic
P. Stockton
10.9 Executive Supplemental Retirement Agreement with Edwin S.
Chan dated January 9, 1995 (Incorporated herein by reference
to Exhibit 10.9 of Form 10-K for the fiscal year ended June
30, 1995)
13.1 Portions of the 1997 Annual Report to Shareholders
21.1 Subsidiaries of the Registrant
23.1 Consent of KPMG Peat Marwick LLP, Independent Auditors (see
Page S-1)
24.1 Power of Attorney (see Signature page)
27.1 Financial Data Schedule
10
Consent and Independent Auditors' Report
on Financial Statement Schedule
The Board of Directors
TRM Copy Centers Corporation:
The audits referred to in our report dated August 15, 1997 included the related
financial statement schedule as of June 30, 1997 and for each year in the
three-year period ended June 30, 1997, as listed in Item 14(a)(2) of Form 10-K
of TRM Copy Centers Corporation. This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express an
opinion on this financial statement schedule based on our audits. In our
opinion, such financial statement schedule, when considered in relation to the
basic consolidated financial statements taken as a whole, presents fairly, in
all material respects, the information set forth therein.
We consent to the incorporation by reference on Form S-8 (Nos. 33-55370 and
33-74354) of TRM Copy Centers Corporation of our reports dated August 15, 1997,
relating to the consolidated balance sheets of TRM Copy Centers Corporation and
subsidiaries as of June 30, 1997 and 1996, and the related consolidated
statements of operations, stockholders' equity, cash flows, and related schedule
for each of the years in the three-year period ended June 30, 1997, which
reports appear in the June 30, 1997 annual report incorporated by reference in
Form 10-K of TRM Copy Centers Corporation.
KPMG PEAT MARWICK LLP
Portland, Oregon
September 17, 1997
S-1
TRM COPY CENTERS CORPORATION AND SUBSIDIARIES
SCHEDULE VIII -- VALUATION AND QUALIFYING ACCOUNTS
Years ended June 30, 1995, 1996, and 1997
(In thousands)
Balance at Charged to Charged to Balance at
Beginning of costs and other Deductions - End of
Period expenses accounts write offs Period
-------------- ------------- ------------- ------------- -------------
Year ended June 30, 1995
Allowance for doubtful accounts............ $ 183 $ 344 $ -- $ (261) $ 266
============== ============= ============= ============= =============
Year ended June 30, 1996
Allowance for doubtful accounts............ $ 266 $ 700 $ -- $ (679) $ 287
============== ============= ============= ============= =============
Year ended June 30, 1997
Allowance for doubtful accounts............ $ 287 $ 835 $ -- $ (974) $ 148
============== ============= ============= ============= =============
S-2