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Delaware				76-0681190
(State or Other Jurisdiction of Incorporation or Organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification No.)

3110 Hayes Road, Suite 300 Houston, Texas 77082 (281) 596-9988 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)		J. Chris Brewster Chief Financial Officer and Treasurer 3110 Hayes Road, Suite 300 Houston, Texas 77082 (281) 596-9988 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

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Proposed Maximum

Proposed Maximum

Amount of

Title of Each Class of

Amount

Offering

Aggregate

Registration

Securities to be Registered

to be Registered

Price per Note(1)

Offering Price(1)

Fee

9.250% Senior Subordinated Notes due 2013

$200,000,000

100%

$200,000,000

$21,400

Guarantees by certain of Cardtronics, Inc.’s subsidiaries

—

—

—

—(2)

(1)	Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(f) under the Securities Act of 1933.
(2)	Pursuant to Rule 457(n) no separate fee for the guarantees is payable because the guarantees relate to other securities that are being registered concurrently.

	*	Includes certain subsidiaries of Cardtronics, Inc. identified below.

Delaware		75-3003720
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification Number)

Delaware		51-0412519
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification Number)

Delaware		76-0419117
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification Number)

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	•	We are offering to exchange up to $200,000,000 of our outstanding 9.250% Senior Notes due 2013 for new notes with substantially identical terms that have been registered under the Securities Act and are freely tradable.
	•	We will exchange all outstanding notes that you validly tender and do not validly withdraw before the exchange offer expires for an equal principal amount of new notes.
	•	The exchange offer expires at 5:00 p.m., New York City time, on                     , 2006, unless extended. We do not currently intend to extend the exchange offer.
	•	Tenders of outstanding notes may be withdrawn at any time prior to the expiration of the exchange offer.
	•	The exchange of outstanding notes for new notes will not be a taxable event for U.S. federal income tax purposes.

	•	The new notes will mature on August 15, 2013.

	•	Interest on the new notes is payable on February 15 and August 15 of each year.
	•	Interest will accrue from August 12, 2005 or the most recent date to which interest has been paid.

	•	We may redeem some or all of the new notes at any time on or after August 15, 2009 at redemption prices listed in “Description of the New Notes — Optional Redemption,” and we may redeem some or all of the notes before that date by the payment of a make-whole premium.
	•	Subject to certain limitations, we may also redeem up to 35% of the new notes using the proceeds of certain equity offerings completed before August 15, 2008.

	•	If we experience a change of control, subject to certain conditions, we must offer to purchase the new notes.

	•	The new notes are unsecured senior subordinated obligations. The new notes rank junior in right of payment with all of our other existing and future senior debt including borrowings under our bank credit facilities.

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INDUSTRY AND MARKET DATA			i
FORWARD-LOOKING STATEMENTS			i
SUMMARY			1
RISK FACTORS			8
EXCHANGE OFFER			19
RATIOS OF EARNINGS TO FIXED CHARGES			26
USE OF PROCEEDS			27
SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OPERATING DATA			28
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			30
THE ATM INDUSTRY			58
BUSINESS			60
MANAGEMENT			73
PRINCIPAL STOCKHOLDERS			83
DESCRIPTION OF OTHER INDEBTEDNESS			85
DESCRIPTION OF THE NEW NOTES			86
FEDERAL INCOME TAX CONSIDERATIONS			128
PLAN OF DISTRIBUTION			129
LEGAL MATTERS			130
EXPERTS			130
WHERE YOU CAN FIND MORE INFORMATION			130
INDEX TO FINANCIAL STATEMENTS			F-1
LETTER OF TRANSMITTAL			A-1
First Amended and Restated Certificate of Incorporation
Certificate of Amendment of the First Amended Certificate of Incorporation
Certificate of Amendment of the First Amended Certificate of Incorporation
First Amended and Restated Bylaws
Indenture dated August 12, 2005
Registration Rights Agreement
Opinion of Vinson & Elkins L.L.P.
Third Amended and Restated First Lien Credit Agreement
Amendment No. 1 to Credit Agreement
Amendment No. 2 to Credit Agreement
Amendment No. 3 to Credit Agreement
Second Amendment to Employment Agreement - Jack M. Antonini
Restricted Stock Agreement - Jack M. Antonini
First Amendment to Restricted Stock Agreement - Jack M. Antonini
Second Amendment to Restricted Stock Agreement - Jack M. Antonini
First Amendment to Employee Agreement - Michael H. Clinard
First Amendment to Employee Agreement - Thomas E. Upton
First Amendment to Employee Agreement - J. Chris Brewster
Employment Agreement - Drew Soinski
Amended and Restated Service Agreement
Bonus Agreement
2001 Stock Incentive Plan
Amendment No.1 to the 2001 Stock Incentive Plan
Amendment No.2 to the 2001 Stock Incentive Plan
Form of Director Indemnification Agreement
Computation of Ratio of Earnings to Fixed Charges
List of Subsidiaries
Consent of KPMG LLP
Consent of Deloitte and Touche, LLP
Statement of Eligibility on Form T-1

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	We operate in a changing and unpredictable regulatory environment. If we are subject to new legislation regarding the operation of our ATMs, we could be required to make substantial expenditures to comply with such legislation, which may adversely affect our profit margins.

	The passing of legislation banning or limiting surcharge fees would severely impact our revenue.

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	We depend on ATM transaction fees for substantially all of our revenues and would be adversely affected by a decline in usage of or surcharge fees at our ATMs.

	We will be subject to new proposed guidelines under the Americans with Disabilities Act that may require us to retrofit non-compliant ATMs, thus increasing our capital expenditures and decreasing our net income.

	We derive a substantial portion of our revenue from ATMs placed with a small number of merchants. If one or more of our top merchants were to cease doing business with us, or to substantially reduce its dealings with us, our revenues could decline.

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	The ATM industry is highly competitive and such competition may increase, which may adversely affect our profit margins.

	We may be unable to integrate our recent and future acquisitions in an efficient manner and inefficiencies would increase our cost of operations and reduce our profitability.

	•	the operations, technology and personnel of any acquired companies may be difficult to integrate;
	•	the allocation of management resources to consummate these transactions may disrupt our day-to-day business; and
	•	acquired networks may not achieve anticipated revenues, earnings or cash flow. Such a shortfall could require us to write down the carrying value of the intangible assets associated with any acquired company, which would adversely affect our reported earnings.

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	The full impact of our recent acquisitions on our operating results is not fully reflected in our historical financial results, which as a result we believe are not necessarily indicative of our future results of operations.

	Changes in interest rates could increase our operating costs by increasing interest expense under our credit facilities and our cash management costs.

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	We are exposed to the risk of fluctuations in foreign currencies, specifically the British Pound.

	Our international operations may not be successful.

	•	exposure to currency fluctuations;
	•	difficulties in complying with foreign laws and regulations;
	•	unexpected changes in regulatory requirements;
	•	difficulties in staffing and managing foreign operations; and
	•	potentially adverse tax consequences.

	If we, our transaction processors, our EFT network or other service providers experience system failures, the ATM products and services we provide could be delayed or interrupted, which would harm our business.

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	We rely on third parties to provide us with the cash we require to operate many of our ATMs. If these third parties were unable or unwilling to provide us with the necessary cash to operate our ATMs, we would need to locate alternative sources of cash to operate our ATMs or we would not be able to operate our business.

	Criminal activity by third parties, whether through tampering with our ATM machines or otherwise, could result in decreased consumer confidence in ATM usage and thereby reduce our profit.

	We rely on EFT network providers, transaction processors and maintenance providers; if they fail or no longer agree to provide their services, we could suffer a temporary loss of transaction revenues or the permanent loss of any merchant contract affected by such disruption.

	Taxes imposed at the state level may decrease our net income.

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	We have a substantial amount of indebtedness, which may adversely affect our cash flow and our ability to operate our business, remain in compliance with debt covenants and make payments on our indebtedness, including the notes.

	•	make it more difficult for us to satisfy our obligations with respect to our indebtedness, including the notes, and any failure to comply with the obligations of any of our debt instruments, including financial and other restrictive covenants, could result in an event of default under the indenture governing the notes and the agreements governing such other indebtedness;
	•	require us to dedicate a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for working capital, capital expenditures, acquisitions and other general corporate purposes;
	•	limit our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
	•	make us more vulnerable to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
	•	limit our ability to borrow additional amounts for working capital, capital expenditures, acquisitions, debt service requirements, execution of our growth strategy, research and development costs or other purposes; and
	•	place us at a disadvantage compared to our competitors who have less debt.

	Repayment of our debt, including the notes, is dependent on cash flow generated by our subsidiaries.

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	Your right to receive payments on the notes is junior to our existing and future senior debt, and the guarantees of the notes are junior to all of the guarantors’ existing and future senior debt.

	Your right to receive payments on the notes is effectively subordinated to the rights of existing and future creditors of our subsidiaries that are not guarantors on the notes.

	To service our indebtedness, we will require a significant amount of cash. Our ability to generate cash depends on many factors beyond our control, and any failure to meet our debt service obligations could harm our business, financial condition and results of operations.

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	The terms of our credit agreement and the indenture governing the notes may restrict our current and future operations, particularly our ability to respond to changes in our business or to take certain actions.

	•	sell or transfer property or assets;
	•	pay dividends on or redeem or repurchase stock;
	•	merge into or consolidate with any third party;
	•	create, incur, assume or guarantee additional indebtedness;
	•	create certain liens;
	•	make investments;
	•	make certain restricted payments, including the payment of dividends;
	•	engage in transactions with affiliates;
	•	redeem or repurchase capital stock;
	•	issue or sell preferred stock of restricted subsidiaries; and
	•	enter into sale and leaseback transactions.

	The notes and the guarantees are not secured by our assets nor those of the guarantors, and the lenders under our credit agreement are entitled to remedies available to a secured lender, which gives them priority over you to collect amounts due to them.

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	•	we enter into bankruptcy, liquidation, reorganization, or other winding-up proceedings;
	•	there is a default in payment under our credit agreement; or
	•	there is an acceleration of any indebtedness under our credit agreement.

	We may not be able to repurchase the notes upon a change of control.

	The guarantees may not be enforceable because of fraudulent conveyance laws.

	•	were insolvent or rendered insolvent by reason of such incurrence; or
	•	were engaged in a business or transaction for which one of our or such guarantor’s remaining assets constituted unreasonably small capital; or
	•	intended to incur, or believed that we or such guarantor would incur, debts beyond our or such guarantor’s ability to pay such debts as they mature.

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	•	the sum of our or such guarantor’s debts, including contingent liabilities, was greater than the fair saleable value of our or such guarantor’s assets; or
	•	if the present fair saleable value of our or such guarantor’s assets were less than the amount than would be required to pay our or such guarantor’s probable liability on our or such guarantor’s existing debts, including contingent liabilities, as they become absolute and mature; or
	•	we or such guarantor could not pay our or such guarantor’s debts as they become due.

	If you do not properly tender your outstanding notes, you will continue to hold unregistered outstanding notes and your ability to transfer outstanding notes will be adversely affected.

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	•	within 240 days after the original issuance of the outstanding notes on August 12, 2005, file a registration statement with the SEC with respect to a registered offer to exchange each outstanding note for a new note having terms substantially identical in all material respects to such note, except that the new note will not contain terms with respect to transfer restrictions;
	•	use our reasonable best efforts to cause the registration statement to be declared effective under the Securities Act within 300 days after the original issuance of the outstanding notes;
	•	promptly following the effectiveness of the registration statement, offer the new notes in exchange for surrender of the outstanding notes; and
	•	keep the exchange offer open for not less than 30 days (or longer if required by applicable law) after the date notice of the exchange offer is mailed to the holders of the outstanding notes.

	•	a change in law or in applicable interpretations thereof of the staff of the SEC does not permit us to effect the exchange offer; or
	•	for any other reason the exchange offer is not consummated within 330 days from August 12, 2005, the date of the original issuance of the outstanding notes; or
	•	any of the initial purchasers notify us following consummation of the exchange offer that outstanding notes held by it are not eligible to be exchanged for new notes in the exchange offer; or
	•	certain holders are not eligible to participate in the exchange offer, or such holders do not receive freely tradeable securities on the date of the exchange.

	•	if either this registration statement or, if we are obligated to file one, a shelf registration statement is not declared effective by the Commission by the date required,
	•	if we fail to consummate the exchange offer prior to the date that is 330 days after August 12, 2005, or
	•	after this registration statement or a shelf registration statement, as the case may be, is declared effective, such registration statement thereafter ceases to be effective or usable (subject to certain exceptions) (each such event referred to in the preceding clauses being a “registration default”);

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	•	any new notes will be acquired in the ordinary course of your business;
	•	you have no arrangement or understanding with any person or entity to participate in the distribution of the new notes;
	•	you are not engaged in and do not intend to engage in the distribution of the new notes;
	•	if you are a broker-dealer that will receive new notes for your own account in exchange for outstanding notes, you acquired those notes as a result of market-making activities or other trading activities and you will deliver a prospectus, as required by law, in connection with any resale of such new notes; and
	•	you are not our “affiliate,” as defined in Rule 405 of the Securities Act.

	•	you are not our “affiliate” within the meaning of Rule 405 under the Securities Act;
	•	such new notes are acquired in the ordinary course of your business; and
	•	you do not intend to participate in a distribution of the new notes.

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	•	cannot rely on such interpretations by the SEC staff; and
	•	must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction.

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	•	to delay accepting for exchange any outstanding notes,
	•	to extend the exchange offer, or
	•	to terminate the exchange offer,

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	Determinations Under the Exchange Offer

	When We Will Issue New Notes

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	•	a book-entry confirmation of such outstanding notes into the exchange agent’s account at DTC; and
	•	a properly transmitted agent’s message.

	Return of Outstanding Notes Not Accepted or Exchanged

	Your Representations to Us

	•	any new notes that you receive will be acquired in the ordinary course of your business;
	•	you have no arrangement or understanding with any person or entity to participate in the distribution of the new notes;
	•	you are not engaged in and do not intend to engage in the distribution of the new notes;
	•	if you are a broker-dealer that will receive new notes for your own account in exchange for outstanding notes, you acquired those notes as a result of market-making activities or other trading activities and you will deliver a prospectus, as required by law, in connection with any resale of such new notes; and
	•	you are not our “affiliate,” as defined in Rule 405 of the Securities Act.

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	•	SEC registration fees;
	•	fees and expenses of the exchange agent and trustee;
	•	accounting and legal fees and printing costs; and
	•	related fees and expenses.

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																						Nine Months
		Year Ended December 31,																				Ended
																						September 30,
		2004				2003				2002				2001				2000				2005
Ratio of earnings to fixed charges			1.3x				1.1x				—				—				3.8x				1.1x

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																								Nine Months
																								Ended
				Years Ended December 31,																				September 30,
				2004				2003				2002				2001				2000				2005				2004
																								(unaudited)
				(in thousands)
Consolidated Statements of Operations:
Revenues:
	ATM operating revenues			$	182,711			$	101,950			$	59,183			$	33,868			$	15,751			$	191,731			$	125,169
	ATM product sales and other revenues(1)				10,204				8,493				9,603				11,220				10,283				7,457				5,772
		Total revenues			192,915				110,443				68,786				45,088				26,034				199,188				130,941
Cost of revenues:
	Cost of ATM operating revenues				143,504				80,286				49,134				29,121				11,960				148,528				98,211
	Cost of ATM product sales and other revenues				8,703				7,903				8,984				12,089				10,219				6,976				4,997
		Total cost of revenues (exclusive of depreciation shown separately below)			152,207				88,189				58,118				41,210				22,179				155,504				103,208
		Gross profit			40,708				22,254				10,668				3,878				3,855				43,684				27,733
Operating expenses:
	Selling, general and administrative expenses(2)(3)(4)				13,571				7,229				6,142				4,925				2,190				11,552				8,851
	Depreciation and accretion expense				6,785				3,632				1,650				957				528				8,530				4,257
	Amortization expense				5,508				3,842				1,641				554				—				5,689				4,092
		Total operating expenses			25,864				14,703				9,433				6,436				2,718				25,771				17,200
Income (loss) from operations					14,844				7,551				1,235				(2,558	)			1,137				17,913				10,533
Other expenses:
	Interest expense(5)				7,050				3,346				881				478				278				14,224				5,211
	Minority interest in subsidiary				19				—				—				—				—				17				9
	Other(6)				209				106				58				—				—				865				228
		Total other expenses			7,278				3,452				939				478				278				15,106				5,448
Income (loss) before income taxes					7,566				4,099				296				(3,036	)			859				2,807				5,085
Income tax provision (benefit)					2,956				1,511				154				(997	)			317				972				1,931
Income (loss) before cumulative effect of a change in accounting principle					4,610				2,588				142				(2,039	)			542				1,835				3,154
Cumulative effect of change in accounting principle for asset retirement obligations, net of related income tax benefit of $80(7)					—				134				—				—				—				—				—
Net income (loss)					4,610				2,454				142				(2,039	)			542				1,835				3,154
Preferred stock dividends and accretion expense(8)					2,312				2,089				1,880				741				—				1,328				1,709
Net income (loss) available to common stockholders				$	2,298			$	365			$	(1,738	)		$	(2,780	)		$	542			$	507			$	1,445

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																						Nine Months
																						Ended
		Years Ended December 31,																				September 30,
		2004				2003				2002				2001				2000				2005				2004
																						(unaudited)
		(in thousands, except ratios and numbers of ATMs)
Other Financial Data:
Ratio of earnings to fixed charges(9)			1.3	x			1.1	x			—				—				3.8	x			1.1	x			1.3x
Cash flows from operating activities		$	20,466			$	21,629			$	4,491			$	(1,929	)		$	(255	)		$	32,751			$	20,493
Cash flows from investing activities			(118,926	)			(29,663	)			(15,023	)			(7,496	)			(794	)			(133,344	)			(115,958	)
Cash flows from financing activities			94,318				10,404				10,741				12,066				1,184				101,883				95,915
Operating Data:
Total number of ATMs (at period end)			24,581				12,021				8,298				6,707				3,339				26,417				24,803
Total transactions			111,577				64,605				36,212				19,865				8,622				115,152				76,712
Total surcharge transactions			82,087				48,778				28,978				16,027				7,400				79,943				56,733

																						As of
		As of December 31,																				September 30,
		2004				2003				2002				2001				2000				2005				2004
																						(unaudited)
						(in thousands)
Consolidated Balance Sheet Data:
Cash and cash equivalents		$	1,412			$	5,554			$	3,184			$	2,975			$	333			$	2,517			$	6,004
Total assets			195,309				64,434				34,840				25,373				8,864				340,506				184,759
Total long-term debt, including current portion			128,541				31,371				18,475				8,620				2,373				243,567				130,041
Preferred stock(10)			23,634				21,322				19,233				15,453				—				76,263				23,031
Total stockholders’ equity (deficit)			(2,164	)			(6,959	)			(8,909	)			(7,065	)			2,094				(49,173	)			(4,105	)

(1)	ATM product sales and other revenues consist primarily of revenues from the sale of equipment to our merchant-owned customer base and our associate value added resellers, or VARs, as well as other miscellaneous non-transaction based revenues.
(2)	Reflects a stock compensation charge in 2001 of $1.5 million after taxes related to the vesting of all stock options in connection with changes in our ownership structure.
(3)	Reflects non-cash stock compensation charges of $0.4 million and $0.8 million for the nine months ended September 30, 2005 and 2004, respectively, and $0.9 million and $1.6 million for the years ended December 31, 2004 and 2003, respectively, related to a restricted stock grant made to our chief executive officer in 2003 and certain options granted in 2004. Additionally, the 2004 full year results include a one-time bonus of $1.8 million made to our chief executive officer related to the tax liability associated with such restricted stock grant. See note 4 to our consolidated financial statements.
(4)	Reflects the write-off in 2004 of approximately $1.8 million in costs associated with our terminated initial public offering and related costs.
(5)	Reflects the amortization and write-off of $2.9 million and $1.7 million in financing costs associated with the amendment of our bank credit facilities during the years ended December 31, 2004 and 2003, respectively. Additionally, reflects the amortization and write-off of financing costs of $4.3 million during the nine months ended September 30, 2005 related to the amendment of our bank credit facilities in May 2005 and the issuance of our senior subordinated notes in August 2005, and the amortization and write-off of financing costs of $2.8 million during the nine months ended September 30, 2004 related to the amendment of our bank credit facility in June 2004.
(6)	Other primarily consists of losses on the sale or disposal of assets.
(7)	Reflects the effect of our adoption of SFAS No. 143. See note 1(m) to our consolidated financial statements.
(8)	Reflects non-cash dividends on our Series A Preferred Stock, which was redeemed in February 2005. Subsequent to the redemption of the Series A Preferred Stock, the amount reflects the accretion of the Series B Preferred Stock issuance costs.
(9)	For purposes of determining the ratio of earnings to fixed charges, earnings are defined as our income from operations before income taxes and fixed charges (excluding the effects of any preferred stock dividends and related accretion expense). Fixed charges consist of interest expense on all indebtedness, amortization of debt issuance costs, the interest portion of lease payments, and preferred stock dividends and accretion expense. Earnings were insufficient to cover fixed charges by approximately $3.6 million for the year ended December 31, 2002 and $4.1 million for the year ended December 31, 2001. The pro forma effect of the refinancing of our existing term loans with the senior subordinated notes did not change our historical ratios of earnings to fixed charges for the nine months ended September 30, 2005 or the year ended December 31, 2004, by more than 10 percent. Accordingly, no pro forma ratios have been presented herein.

(10)	The amount reflected on our balance sheet is shown net of issuance costs of $1.7 million as of September 30, 2005. The aggregate redemption price for the preferred stock was approximately $78.0 million as of September 30, 2005.

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	•	Company-owned. Under a company-owned arrangement, we own or lease the ATM and are responsible for controlling substantially all aspects of its operation. These responsibilities include what we refer to as first line maintenance, such as replacing paper, clearing paper or bill jams, resetting the ATM and any telecommunications and power issues or other maintenance that do not require a trained service technician. We are also responsible for what we refer to as second line maintenance, or more complex maintenance procedures that require trained service technicians and often involve replacing component parts. In addition to first and second line maintenance, we are responsible for arranging for cash, cash loading, supplies, telecommunications service and all other services required for the operation of the ATM, other than electricity. We typically pay a fee, either periodically, on a per-transaction basis or a combination of both, to the merchant on whose premises the ATM is physically located. We operate a limited number of our company-owned ATMs on a merchant-assisted basis. In these arrangements, we own or lease the ATM and provide all transaction processing services, but the merchant generally is responsible for providing and loading cash for the ATM and first line maintenance. Typically, we deploy ATMs under company-owned arrangements for our national and regional merchant customers, such as Amerada Hess, BP Amoco, Chevron, Circle K, Costco, CVS Pharmacy, Duane Reade, ExxonMobil, Mills Malls, Sunoco, Target and Walgreens in the United States, and Alfred Jones, Co-Op, Mitchells & Butlers, the U.K. Post Office, Tates and Tesco in the United Kingdom. Because company-owned locations are controlled by us, are usually located in major national chains, and are thus more likely candidates for additional sources of revenue such as bank branding, company-owned locations generally offer higher transaction volumes and greater profitability, which we consider necessary to justify the upfront capital cost of installing such machines. As of September 30, 2005, we operated approximately 11,728 ATMs under company-owned arrangements.
	•	Merchant-owned. Under a merchant-owned arrangement, the merchant owns the ATM and is responsible for its maintenance and most of the operating costs. We typically provide all transaction processing services and, in some cases, retain responsibility for providing and loading cash. We typically operate ATMs with our independent merchant customers under merchant-owned arrangements. A merchant who purchases an ATM from us is responsible for providing cash for the ATM and all maintenance. The merchant is also responsible for cash loading, supplies, telecommunication and electrical services. Under these arrangements, we sometimes retain responsibility for second line maintenance for an additional fee, and we provide all transaction processing services. Because the merchant bears more of the costs associated with operating ATMs under this arrangement, the merchant typically receives a higher fee on a per-transaction basis than is the case under a company-owned arrangement. In a limited number of our merchant-owned arrangements, we have assumed responsibility for providing and loading cash. Accordingly, under

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		these arrangements, the merchant receives a smaller fee on a per-transaction basis than in the typical merchant-owned arrangement. As of September 30, 2005, we operated approximately 14,689 ATMs under merchant-owned arrangements.

											Nine Months
			Years Ended								Ended
			December 31,								September 30,
			2004				2003				2005
Company-owned:
	Revenues			55%				61%				53%
	Gross profit			68%				73%				66%
Merchant-owned:
	Revenues			45%				39%				47%
	Gross profit			32%				27%				34%

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																							Pro Forma
			Year Ended												Nine Months				Pro Forma				Nine Months
			December 31,												Ended				Year Ended				Ended
															September 30,				December 31,				September 30,
			2004				2003				2002				2005				2004				2005
Per surcharge-bearing transaction:
	Surcharge revenue		$	1.53			$	1.43			$	1.42			$	1.69			$	1.67			$	1.73
	Interchange revenue			0.63				0.60				0.57				0.62				0.60				0.61
Per total transaction:
	Interchange revenue			0.46				0.45				0.46				0.43				0.43				0.42

	•	Surcharge revenue. A surcharge fee represents a convenience fee paid by the cardholder for making a cash withdrawal from an ATM. Surcharge fees are most typically associated with cash withdrawal transactions and generally are not generated by balance inquiries, fund transfers and, in some cases, cash withdrawals from ATMs from which we earn branding revenues. Surcharge fees often vary by the type of arrangement under which we place our ATMs. Our transaction surcharges averaged approximately $1.53 per surcharge-bearing transaction during the year ended December 31, 2004 ($1.67 on a pro forma basis for the E*TRADE Access and Bank Machine acquisitions), and approximately $1.43 during the year ended December 31, 2003. Our transaction surcharges averaged approximately $1.69 per surcharge-bearing transaction during the nine months ended September 30, 2005 ($1.73 on a pro forma basis for the Bank Machine acquisition). Surcharge fees can vary widely based on the location of the ATM and the nature of the contracts negotiated with our merchants. Furthermore, surcharge fees in the United Kingdom are typically higher than the surcharge fees received in the U.S. Accordingly, we expect that our surcharge fees per surcharge-bearing transaction will increase slightly in the near term as a result of the Bank Machine acquisition. Longer term, we

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		expect that surcharge fees per surcharge-bearing transaction will vary depending upon negotiated surcharge fees at newly deployed ATMs and future negotiations with existing merchant partners, and our ongoing efforts to improve profitability through improved pricing.
	•	Interchange revenue. An interchange fee is a fee paid by the cardholder’s financial institution for the use of the applicable electronic funds transfer, or EFT, network that transmits data between the ATM and the cardholder’s financial institution in connection with any ATM transaction, including balance inquiries, transfers and surcharge-free transactions, including those under branding arrangements. We receive a portion of the interchange fee paid to the EFT network. In the U.S., interchange fees are earned not only on cash withdrawal transactions, but also on other ATM transactions such as balance inquiries and fund transfers. In the United Kingdom, interchange fees are earned on all ATM transactions other than surcharge-bearing cash withdrawals. Interchange fees are set by the EFT networks and vary according to EFT network arrangements with financial institutions, as well as the type of transaction. Interchange fees are typically lower for balance inquiries and fund transfers and higher for withdrawals. For the year ended December 31, 2004, we received $51.7 million in interchange fees ($68.8 million on a pro forma basis for the E*TRADE Access and Bank Machine acquisitions). For the year ended December 31, 2003, we received $29.1 million in interchange fees. For the nine months ended September 30, 2005, we received $49.4 million in interchange fees ($50.6 million on a pro forma basis for the Bank Machine acquisition). Interchange fees per surcharge-bearing transaction increased in 2003 and 2004 due to the increase in the number of transactions on ATMs included in surcharge-free networks and branded ATMs, which generate interchange fees, but do not generate surcharge fees and, as a result, are not included in the number of surcharge-bearing transactions. However, on a pro forma basis, interchange fees per surcharge-bearing transaction were slightly lower in 2004 and 2005 (when compared to the corresponding historical amounts for the same periods), due to the fact that interchange fees in the United Kingdom are only earned on non surcharge-bearing transactions, as previously discussed. We believe that our future interchange fees per surcharge-bearing transaction will be consistent with the pro forma amounts reflected above. On an absolute basis we expect that our interchange fees will decrease slightly in the future due to the fact that certain ATM processing networks adjusted their interchange rates downward in 2005. We currently estimate that such reduction will average approximately $50,000 per month during 2006 and approximately $25,000 per month thereafter.
	•	Branding revenue. We generate branding revenue in a variety of ways. We allow financial institutions to place signage on, or brand, our ATMs. Under this arrangement, we allow the branding financial institution’s customers to use branded ATMs without paying a surcharge fee. In exchange, the branding financial institution pays us a fixed monthly fee per branded ATM. We believe that this type of branding arrangement will typically result in an increase in transaction levels at the branded ATMs as existing customers continue to use the ATMs and new customers of the branding financial institution are attracted by the surcharge-free service. We also believe that having a major bank brand on an ATM leads to increased surchargable transactions from customers other than those of the branding bank.

We also generate branding revenue from the ATMs we include in a nationwide surcharge-free ATM alliance of which we are the largest member and owner (effective December 21, 2005). Under this arrangement, cardholders of the institutions that are members of the alliance use our ATMs included in the alliance free of surcharge fees in exchange for a payment to us of a fixed monthly fee per cardholder, which is paid by such cardholder’s financial institution. Fees paid for branding an ATM vary widely within our industry, as well as within our own operations. We expect that this variance in branding fees will continue in the future, but, because our strategy is to set branding fees at least sufficient to offset lost surcharge revenue, we do not expect any such variance to cause a decrease in our total revenues. However, because we have only recently begun to enter into branding arrangements, we are currently unable to meaningfully quantify this anticipated offset to lost surcharge revenue.

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	•	Merchant fees. We pay our merchants a fee that depends on a variety of factors, including the type of arrangement under which the ATM is placed and the number of transactions at that ATM.
	•	Processing fees. We pay fees to third-party vendors for processing transactions originated at our ATMs. These vendors, which include Star Systems, Fiserv, Inc. and Genpass, communicate with the cardholder’s financial institution through EFT networks to gain transaction authorization and to settle transactions.
	•	Cost of cash. Cost of cash includes all costs associated with the provision of cash by us for ATMs, including fees for the use of cash, armored courier services, insurance, cash reconciliation and associated wire fees. Changes in interest rates could affect our cost of cash, though we have entered into a number interest rate swap transactions to hedge our exposure through 2007 on approximately two-thirds of our current outstanding domestic ATM cash balances.
	•	Communications. Under our company-owned arrangements, we are responsible for expenses associated with providing telecommunications capabilities to the ATMs, allowing the ATMs to connect with the applicable EFT network.
	•	Repairs and maintenance. Depending on the type of arrangement with the merchant, we may be responsible for first and/or second line maintenance for the ATM. We typically manage the provision of these services by third parties with national operations. Our primary maintenance vendors are Diebold, NCR and EFMARK.
	•	Direct operations. These expenses consist of costs associated with managing our ATM network, including expenses for program managers, technicians and customer service representatives.
	•	Cost of equipment revenue. In connection with the sale of equipment to merchants and VARs, we incur costs associated with purchasing equipment from manufacturers, as well as delivery and installation expenses.

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	•	The transfer of cash management and vault cash services for approximately 2,500 ATMs to our preferred cash management and vault cash providers;

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	•	The transfer of maintenance services for approximately 10,000 E*TRADE Access ATMs from the existing provider to our preferred maintenance service provider;
	•	The transfer of processing services for approximately 1,600 ATMs to our preferred service provider; and
	•	The transfer of armored car service used in the transportation of cash for approximately 1,000 ATMs to our preferred service provider.

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			Number of ATMs
							As of
			At Closing				September 30, 2005				Increase
2001 Acquisitions				878				1,210				332
2002 Acquisitions				1,195				1,390				195
2003 Acquisitions				3,689				4,465				776
	Total			5,692				7,065				1,303

		Number of ATMs
						As of
		At Closing				September 30, 2005				Decrease
Total			13,155				11,899				(1,256	)

	Acquisition Valuation

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	Financing Transactions

	Winn-Dixie Bankruptcy

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	Impact of Hurricanes

	United Kingdom Transaction Declines

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																	Nine Months
					Years Ended												Ended
					December 31,												September 30,
					2004				2003				2002				2005				2004
Revenues:
ATM operating revenues						94.7	%			92.3	%			86.0	%			96.3	%			95.6	%
ATM product sales and other revenues						5.3				7.7				14.0				3.7				4.4
		Total revenues				100.0				100.0				100.0				100.0				100.0
Cost of revenues:
	Cost of ATM operating revenues					74.4				72.7				71.4				74.6				75.0
	Cost of ATM product sales and other revenues					4.5				7.2				13.1				3.5				3.8
		Total cost of revenues (exclusive of depreciation shown separately below)				78.9				79.9				84.5				78.1				78.8
		Gross profit				21.1				20.1				15.5				21.9				21.2
Operating expenses:
	Selling, general and administrative expenses					7.0				6.5				8.9				5.8				6.8
	Depreciation and accretion expense					3.5				3.3				2.4				4.3				3.2
	Amortization expense					2.9				3.5				2.4				2.9				3.1
			Total operating expenses			13.4				13.3				13.7				13.0				13.1
Income from operations						7.7				6.8				1.8				8.9				8.1
Other expenses:
	Interest expense, net					3.7				3.0				1.3				7.1				4.0
	Minority interest in subsidiary					0.0				0.0				0.0				0.0				0.0
	Other					0.1				0.1				0.1				0.4				0.2
		Total other expenses				3.8				3.1				1.4				7.5				4.2
Income before income taxes						3.9				3.7				0.4				1.4				3.9
Income tax provision						1.5				1.4				0.2				0.5				1.5
Income before cumulative effect of change in accounting principle						2.4				2.3				0.2				0.9				2.4
Cumulative effect of change in accounting principle for asset retirement obligations, net of related income tax benefit						—				0.1				—				—				—
Net income						2.4	%			2.2	%			0.2	%			0.9	%			2.4	%

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	Key Operating Metrics

															Nine Months
															Ended
			Years Ended December 31,												September 30,
			2004				2003				2002				2005				2004
Average number of ATMs				18,429				10,662				7,417				26,099				17,216
Total transactions (in thousands)				111,577				64,605				36,212				115,152				76,712
Monthly total transactions per ATM				505				505				407				490				495
Total surcharge-bearing transactions (in thousands)				82,087				48,778				28,978				79,943				56,733
Monthly surcharge-bearing transactions per ATM (in thousands)(1)				371				381				326				340				366
Per surcharge-bearing transaction:
	Surcharge revenues		$	1.53			$	1.43			$	1.42			$	1.69			$	1.52
	Interchange revenues			0.63				0.60				0.57				0.62				0.63
	Other transaction revenues(2)			0.06				0.06				0.05				0.09				0.06
	Total transaction revenues		$	2.23			$	2.09			$	2.04			$	2.40			$	2.21
	Cost of transaction revenues			1.75				1.65				1.70				1.86				1.73
	Transaction gross profit(3)		$	0.48			$	0.44			$	0.34			$	0.54			$	0.48
	Transaction gross profit margin			21.5	%			21.1	%			16.7	%			22.5	%			21.5	%

(1)	Monthly surcharge-bearing transactions per ATM for the nine month period ended September 30, 2005 were lower than in the nine month period September 30, 2004 largely because the ATMs acquired from E*TRADE Access, Inc. on June 30, 2004 were primarily merchant-owned machines with lower average transactions per ATM.
(2)	Other transaction revenues consist primarily of bank and network branding fees (for periods subsequent to 2002), and other transaction-based fees.
(3)	Transaction gross profit is a measure of profitability that uses only the revenue and expenses that are transaction based. The revenue and expenses from ATM equipment sales and other ATM-related services are not included.

	Nine Months Ended September 30, 2005 and September 30, 2004

	Revenues

			Nine Months Ended
			September 30,
			2005				2004				% Change
			(in thousands)
ATM operating revenues			$	191,731			$	125,169				53.2	%
ATM product sales and other revenues				7,457				5,772				29.2	%
	Total revenues		$	199,188			$	130,941				52.1	%

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	Cost of Revenues and Gross Margins

			Nine Months Ended
			September 30,
			2005				2004				% Change
			(in thousands)
Cost of ATM operating revenues			$	148,528			$	98,211				51.2	%
Cost of ATM product sales and other revenues				6,976				4,997				39.6	%
	Total cost of revenues		$	155,504			$	103,208				50.7	%
ATM operating revenues gross margin				22.5	%			21.5	%
ATM product sales and other revenues gross margin				6.5	%			13.4	%
Total gross margin				21.9	%			21.2	%

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	Selling, General and Administrative Expense

		Nine Months Ended
		September 30,
		2005				2004				% Change
		(in thousands)
Selling, general and administrative expense		$	11,552			$	8,851				30.5	%
Percentage of revenues			5.8	%			6.8	%

	Depreciation and Accretion Expense

		Nine Months Ended
		September 30,
		2005				2004				% Change
		(in thousands)
Depreciation and accretion expense		$	8,530			$	4,257				100.4	%
Percentage of revenues			4.3	%			3.2	%

	Amortization Expense

		Nine Months Ended
		September 30,
		2005				2004				% Change
		(in thousands)
Amortization expense		$	5,689			$	4,092				39.0	%
Percentage of revenues			2.9	%			3.1	%

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	Interest Expense

		Nine Months Ended
		September 30,
		2005				2004				% Change
		(in thousands)
Interest expense, net		$	14,224			$	5,211				173.0	%
Percentage of revenues			7.1	%			4.0	%

	Income Tax Provision

		Nine Months Ended
		September 30,
		2005				2004				% Change
		(in thousands)
Income tax provision		$	972			$	1,931				(49.7	)%
Effective tax rate			34.6	%			38.0	%

	Years Ended December 31, 2004 (2004) and December 31, 2003 (2003)

	Revenues

			Years Ended
			December 31,
			2004				2003				% Change
			(in thousands)
ATM operating revenues			$	182,711			$	101,950				79.2	%
ATM product sales and other revenues				10,204				8,493				20.1	%
	Total revenues		$	192,915			$	110,443				74.7	%

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	Cost of Revenues and Gross Margins

			Year Ended
			December 31,
			2004				2003				% Change
			(in thousands)
Cost of ATM operating revenues			$	143,504			$	80,286				78.7	%
Cost of ATM product sales and other revenues				8,703				7,903				10.1	%
	Total cost of revenues		$	152,207			$	88,189				72.6	%
ATM operating revenues gross margin				21.5	%			21.2	%
ATM product sales and other revenues gross margin				14.7	%			6.9	%
Total gross margin				21.1	%			20.1	%

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	Selling, General and Administrative Expenses

		Years Ended
		December 31,
		2004				2003				% Change
		(in thousands)
Selling, general and administrative expense		$	13,571			$	7,229				87.7	%
Percentage of revenues			7.0	%			6.5	%

	Depreciation and Accretion Expense

		Years Ended
		December 31,
		2004				2003				% Change
		(in thousands)
Depreciation and accretion expense		$	6,785			$	3,632				86.8	%
Percentage of revenues			3.5	%			3.3	%

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	Amortization Expense

		Years Ended
		December 31,
		2004				2003				% Change
		(in thousands)
Amortization expense		$	5,508			$	3,842				43.4	%
Percentage of revenues			2.9	%			3.5	%

	Interest Expense

		Years Ended
		December 31,
		2004				2003				% Change
		(in thousands)
Interest expense		$	7,050			$	3,346				110.7	%
Percentage of revenues			3.7	%			3.0	%

	Income Tax Provision

		Years Ended
		December 31,
		2004				2003				% Change
		(in thousands)
Income tax provision		$	2,956			$	1,511				95.6	%
Effective tax rate			39.1	%			36.9	%

	Cumulative Effect of Change in Accounting Principle (Net)

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	Years Ended December 31, 2003 (2003) and December 31, 2002 (2002)

	Revenues

			Years Ended
			December 31,
			2003				2002				% Change
			(in thousands)
ATM operating revenues			$	101,950			$	59,183				72.3	%
ATM product sales and other revenues				8,493				9,603				(11.6	)%
	Total revenues		$	110,443			$	68,786				60.6	%

	Cost of Revenues and Gross Margins

			Year Ended
			December 31,
			2003				2002				% Change
			(in thousands)
Cost of ATM operating revenues			$	80,286			$	49,134				63.4	%
Cost of ATM product sales and other revenues				7,903				8,984				(12.0	)%
	Total cost of revenues		$	88,189			$	58,118				51.7	%
ATM operating revenues gross margin				21.2	%			17.0	%
ATM product sales and other revenues gross margin				6.9	%			6.4	%
Total gross margin				20.1	%			15.5	%

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	Selling, General and Administrative Expenses

		Years Ended
		December 31,
		2003				2002				% Change
		(in thousands)
Selling, general and administrative expense		$	7,229			$	6,142				17.7	%
Percentage of revenues			6.5	%			8.9	%

	Depreciation and Accretion Expense

		Years Ended
		December 31,
		2003				2002				% Change
		(in thousands)
Depreciation and accretion expense		$	3,632			$	1,650				120.1	%
Percentage of revenues			3.3	%			2.4	%

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	Amortization Expense

		Years Ended
		December 31,
		2003				2002				% Change
		(in thousands)
Amortization expense		$	3,842			$	1,641				134.1	%
Percentage of revenues			3.5	%			2.4	%

	Interest Expense

		Years Ended
		December 31,
		2003				2002				% Change
		(in thousands)
Interest expense		$	3,346			$	881				279.8	%
Percentage of revenues			3.0	%			1.3	%

	Income Tax Provision

		Years Ended
		December 31,
		2003				2002				% Change
		(in thousands)
Income tax provision		$	1,511			$	154				881.2	%
Effective tax rate			36.9	%			52.0	%

	Cumulative Effect of Change in Accounting Principle (Net)

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		Years Ended December 31,												Nine Months
														Ended
		2004				2003				2002				September 30, 2005
														(unaudited)
Net cash provided by operating activities		$	20,466			$	21,629			$	4,491			$	32,751
Net cash used in investing activities			(118,926	)			(29,663	)			(15,023	)			(133,344	)
Net cash provided by financing activities			94,318				10,404				10,741				101,833

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	Our Bank Credit Facilities

Contractual Obligations		Total				2005				2006				2007				2008				2009				Thereafter
		(in thousands)
Long-term debt(a)(b)		$	241,800			$	—			$	—			$	—			$	—			$	—			$	241,800
Notes payable			3,146				—				3,146				—				—				—				—
Operating lease obligations			5,461				950				2,742				893				391				364				121
Merchant space lease obligations			13,518				1,126				4,376				3,453				3,242				982				339
Total contractual obligations		$	263,925			$	2,076			$	10,264			$	4,346			$	3,633			$	1,346			$	242,260

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(a)		Includes the face value of our senior subordinate notes of $200.0 million, which is reflected net of unamortized discount of approximately $1.4 million in our consolidated financial statements included elsewhere in this registration statement.
(b)		Amount does not include any related interest payments associated with such borrowing.

	Interest Rate Risk

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Notional				Weighted Average
Amount				Fixed Rate				Period
$200,000					3.19	%			Through September 30, 2005
$300,000					3.57	%			October 1, 2005 — December 31, 2005
$300,000					3.63	%			January 1, 2006 — December 31, 2006
$300,000					3.86	%			January 1, 2007 — December 31, 2007
$300,000					4.35	%			January 1, 2008 — December 31, 2008
$200,000					4.36	%			January 1, 2009 — December 31, 2009
$100,000					4.34	%			January 1, 2010 — December 31, 2010

	Foreign Currency Exchange Risk

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	•	Bank branding is a scenario in which ATMs owned and operated by us are branded, signed, and operated as if they were owned by the branding bank, and customers of the branding bank can use those machines without paying a surcharge. The bank pays us a monthly per-machine fee for such branding. Although we forego the surcharge fee on ATM transactions by the branding banks’ customers, we continue to earn interchange fees on those transactions and the monthly branding fee, and typically enjoy an increase in surchargable transactions from users who are not customers of the branding bank. We believe that a branding arrangement can substantially increase the profitability of an ATM versus operating the same machine in an unbranded mode.
	•	Network branding is an arrangement where a bank’s customers are allowed to use our nationwide ATM network on a surcharge-free basis. Each bank pays a fee to the network, and we in turn receive a large portion of that fee. Although we forego surcharge revenue on those transactions, we do earn interchange revenues in addition to network branding revenues, and believe that many of these transactions are incremental. Consequently, we believe that branding arrangements can enable us to profitably operate in the significant portion of the ATM transaction market that does not involve a surcharge.

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Rank				U.S. ATM Network		ATMs				% of Total
	1			Cardtronics			25,346				6.4%
	2			Bank of America			16,714				4.2%
	3			TRM			15,348				3.9%
	4			NetBank			8,445				2.1%
	5			JPMorgan Chase			7,136				1.8%
	6			Wells Fargo			6,363				1.6%
	7			International Merchant Services			5,900				1.5%
	8			7-Eleven Stores			5,341				1.3%
	9			Wachovia			5,100				1.3%
	10			U.S. Bancorp			4,999				1.3%
				(Top 10)			100,692				25.4%
				U.S. Market			396,000				100.0%

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		Company-Owned				Merchant-Owned
		ATMs				ATMs				Total
Number of ATMs			11,728				14,689				26,417
Percent of total ATMs			44	%			56	%			100	%
Average monthly surcharge transactions per ATM			476				265				353

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	•	an initial term of five to seven years;
	•	ATM exclusivity at locations where we install an ATM;
	•	protection for us against underperforming locations by permitting us to increase the surcharge fee or remove ATMs;
	•	in the United States, provisions permitting us to terminate or remove ATMs or renegotiate the fees paid to the merchant if surcharge fees are generally reduced or eliminated by law; and
	•	provisions making the merchant’s fee dependent on the number of ATM transactions.

	•	in the United States, provisions prohibiting in-store check cashing by the merchant and, in the United States and United Kingdom, the operation of any other cash-back devices;
	•	provisions imposing an obligation on the merchant to operate the ATM at any time his or her store is open to the public; and
	•	provisions, when possible, that require a merchant to have a purchaser of the merchant’s store assume our contract.

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Name		Age				Position
Jack Antonini			52			Chief Executive Officer, President and Director
J. Chris Brewster			56			Chief Financial Officer and Treasurer
Michael H. Clinard			38			Chief Operating Officer
Thomas E. Upton			49			Chief Administrative Officer
Drew Soinski			46			Chief Marketing Officer
Fred R. Lummis			52			Director and Chairman of the Board of Directors
Robert P. Barone			68			Director
Frederick W. Brazelton			34			Director
Ralph H. Clinard			72			Director
Ron Coben			48			Director
Jorge M. Diaz			41			Director
Roger B. Kafker			43			Director
Michael A. R. Wilson			38			Director
Ronald Delnevo			51			Director and Chief Executive of Bank Machine Limited

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			Annual
			Compensation
Name and Principal Position			Salary				Bonus
Jack Antonini			$	330,750			$	—	(1)
	Chief Executive Officer, President and Director
J. Chris Brewster				236,250				—	(1)
	Chief Financial Officer and Treasurer
Michael H. Clinard				220,500				—	(1)
	Chief Operating Officer
Thomas E. Upton				210,000				—	(1)
	Chief Administrative Officer
Ronald Delnevo(2)				164,232	(3)			—	(1)
	Chief Executive of Bank Machine Limited and Director

(1)	Bonuses earned for the year ended December 31, 2005 were not finalized as of the date of this filing.
(2)	Mr. Delnevo joined us in May 2005 as part of the Bank Machine acquisition.
(3)	Amount converted at an average exchange rate of $1.7818 to £1.00.

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Number of

% of Total

Securities

Options

Underlying

Granted to

Exercise or

Grant Date

Options

Employees in

Base Price

Expiration

Present

Granted(1)

Fiscal Year

($/Share)

Date

Value $(2)

Ronald Delnevo

40,000

19.0%

$

83.84

5/17/2015

$

311,384

(1)	The ten-year options granted in 2005 vest ratably over four years beginning one year following the date of grant.
(2)	The Black-Scholes option pricing model was utilized to determine the grant date present value of the stock options granted in 2005. Under the Black-Scholes option pricing model, the grant date present value of the stock options referred to in the table above was calculated to be $7.78 per share. The following facts and assumptions were utilized in making such calculation: (a) an unadjusted exercise price $83.84 per share; (b) a fair market value of $83.84 per share on the date of grant; (c) no dividend yield; (d) a term of five years; (e) no volatility; and (f) an assumed risk-free interest rate of 3.82%, which approximated the yield on the five year treasury note on the date of grant. No other discounts or restrictions related to the vesting or the likelihood of vesting of the stock options were applied. The resulting grant date present value per share amount was multiplied by the total number of stock options granted to determine the total grant date present value figure above.

										Number of Shares								Value of Unexercised
										Underlying Unexercised								In-the-Money
		Shares								Options at Year-End								Options at Year-End(1)
		Acquired				Value
		on Exercise				Realized				Exercisable				Unexercisable				Exercisable				Unexercisable
Jack Antonini(2)			—				—				—				—			$	—			$	—
J. Chris Brewster			—				—				15,000				30,000			$	477,591			$	955,182
Michael H. Clinard			—				—				18,683				—			$	1,419,859			$	—
Thomas E. Upton			—				—				22,354				1,250			$	1,728,278			$	90,137
Ronald Delnevo			—				—				—				40,000			$	—			$	—

(1)	There was no public market for our common stock on December 31, 2005. Accordingly, we calculated these values based on an estimated price per share of $83.84, as determined by management, less the applicable exercise prices.
(2)	Mr. Antonini only owns restricted shares in the Company and has not been granted any options to purchase the Company’s common stock.

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	•	Each employment agreement requires the employee to protect the confidentiality of our proprietary and confidential information.
	•	Each employment agreement requires that the employee not compete with us or solicit our employees or customers for a period of 24 months following the term of his employment.

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	•	Each employment agreement provides that the employee may be paid an annual bonus based on certain factors and objectives set by our compensation committee, with the ultimate amount of any bonus paid determined at the direction of our compensation committee.

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	•	each person known to us to beneficially own more than 5% of the outstanding shares of our common stock;
	•	each of the executive officers identified in the summary compensation table;
	•	each of our directors; and
	•	all directors and named executive officers as a group.

		Number of Shares				Percent of
		of Common Stock				Common Stock
Name of Beneficial Owner(1)		Beneficially Owned				Beneficially Owned
5% Stockholders:
CapStreet II, L.P.			1,017,958				35.1	%
CapStreet Parallel II, L.P.			119,501				4.1	%
TA Associates, Inc.(2)			894,568				30.9	%
Ralph H. Clinard(3)			420,225				14.5	%
Directors and Executive Officers:
Fred R. Lummis(4)			1,137,459				39.2	%
Michael Wilson(5)			894,568				30.9	%
Roger Kafker(6)			894,568				30.9	%
Jack Antonini			70,508				2.4	%
Michael H. Clinard(7)			75,382				2.6	%
Thomas E. Upton(8)			35,502				1.2	%
J. Chris Brewster(9)			15,000				*
Ronald Delnevo(10)			13,209				*
Robert P. Barone(11)			4,316				*
Frederick W. Brazelton			—				—
Ron Coben(12)			4,316				*
Jorge M. Diaz(13)			1,250				*
All executive officers and directors as a group (13 persons)			2,898,941				90.8	%

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*		Less than 1% of the outstanding common stock.
(1)		“Beneficial ownership” is a term broadly defined by the SEC in Rule 13d-3 under the Exchange Act, and includes more than the typical forms of stock ownership, that is, stock held in the person’s name. The term also includes what is referred to as “indirect ownership,” meaning ownership of shares as to which a person has or shares investment or voting power. For the purpose of this table, a person or group of persons is deemed to have “beneficial ownership” of any shares as of December 31, 2005 that such person or group has the right to acquire within 60 days after such date.
(2)		The shares owned by TA Associates, Inc. through certain of its affiliated funds, including TA IX L.P., TA/ Atlantic and Pacific IV L.P., TA/ Atlantic and Pacific V L.P., TA Strategic Partners Fund A L.P., TA Strategic Partners Fund B L.P., TA Investors II, L.P., which we collectively refer to as the TA Funds, are Series B Preferred shares which are convertible into our common stock on a share for share basis.
(3)		Mr. Clinard is a member of our board of directors.
(4)		The shares indicated as being beneficially owned by Mr. Lummis are owned directly by CapStreet II, L.P. and CapStreet Parallel II, L.P. Mr. Lummis serves as a Managing Director of The CapStreet Group, the ultimate general partner of both CapStreet II, L.P. and CapStreet Parallel II, L.P. As such, Mr. Lummis may be deemed to have a beneficial ownership of the shares owned by CapStreet II, L.P. and CapStreet Parallel II, L.P. Mr. Lummis disclaims beneficial ownership of such shares.
(5)		Mr. Wilson serves as a Managing Director of TA Associates, Inc., the ultimate general partner of the TA Funds. As such, Mr. Wilson may be deemed to have a beneficial ownership of the shares owned by the TA Funds. Mr. Wilson disclaims beneficial ownership of such shares.
(6)		Mr. Kafker serves as a Managing Director of TA Associates, Inc., the ultimate general partner of the TA Funds. As such, Mr. Kafker may be deemed to have a beneficial ownership of the shares owned by the TA Funds. Mr. Kafker disclaims beneficial ownership of such shares.
(7)		Includes options to purchase 18,683 shares of common stock exercisable by Michael H. Clinard.
(8)		Includes options to purchase 22,354 shares of common stock exercisable by Thomas E. Upton.
(9)		Represents options to purchase 15,000 shares of common stock exercisable by J. Chris Brewster.
(10)		Represents Series B Preferred shares which are convertible into our common stock on a share for share basis.
(11)		Represents options to purchase 4,316 shares of common stock exercisable by Robert P. Barone.
(12)		Represents options to purchase 4,316 shares of common stock exercisable by Ron Coben.
(13)		Represents options to purchase 1,250 shares of common stock exercisable by Jorge Diaz.

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	•	are general unsecured obligations of the Company;
	•	are subordinated in right of payment to all existing and future Senior Debt of the Company, including the Indebtedness of the Company under the Credit Agreement;
	•	are pari passu in right of payment with all existing and any future senior subordinated Indebtedness of the Company;
	•	are senior in right of payment to all existing and any future subordinated Indebtedness of the Company;
	•	are guaranteed by the Guarantors as described under “— Note Guarantees”; and
	•	are effectively subordinated to all existing and any future Indebtedness and other liabilities of the Company’s Subsidiaries that are not Guarantors.

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	•	is a general unsecured obligation of that Guarantor;
	•	is subordinated in right of payment to all existing and future Senior Debt of that Guarantor, including the Guarantee by that Guarantor of Indebtedness under the Credit Agreement;
	•	is pari passu in right of payment with all existing and any future senior subordinated Indebtedness of that Guarantor; and
	•	is senior in right of payment to all existing and any future subordinated Indebtedness of that Guarantor.

	(1) any liquidation or dissolution of the Company;
	(2) any bankruptcy, reorganization, insolvency, receivership or similar proceeding relating to the Company or its property;
	(3) any assignment for the benefit of creditors; or
	(4) any marshaling of the Company’s assets and liabilities.

	(1) a default (a “payment default”) in the payment of principal, premium or interest on Designated Senior Debt of the Company occurs and is continuing; or
	(2) any other default (a “nonpayment default”) occurs and is continuing on any series of Designated Senior Debt of the Company that permits holders of that series of Designated Senior Debt of the Company to accelerate its maturity, and the Trustee receives a notice of such default (a “Payment Blockage Notice”) from a representative of the holders of such Designated Senior Debt.

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	(1) in the case of a payment default on Designated Senior Debt of the Company, upon the date on which such default is cured or waived; and
	(2) in case of a nonpayment default on Designated Senior Debt of the Company, the earlier of (x) the date on which such default is cured or waived, (y) 179 days after the date on which the applicable Payment Blockage Notice is received and (z) the date the Trustee receives notice from the representative for such Designated Senior Debt rescinding the Payment Blockage Notice, unless, in each case, the maturity of such Designated Senior Debt of the Company has been accelerated.

	(1) 360 days have elapsed since the delivery of the immediately prior Payment Blockage Notice; and
	(2) all scheduled payments of principal, interest and premium and Additional Interest, if any, on the Notes that have come due have been paid in full in cash or Cash Equivalents.

	(1) the payment is prohibited by these subordination provisions; and
	(2) the Trustee or the Holder has actual knowledge that the payment is prohibited (provided that such actual knowledge will not be required in the case of any payment default on Designated Senior Debt),

	(1) any Indebtedness outstanding under the Credit Agreement; and
	(2) to the extent permitted under the Credit Agreement, any other Senior Debt permitted under the Indenture the amount of which is $25.0 million or more and that has been designated by the Company as “Designated Senior Debt.”

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	(1) Equity Interests in the Company or any Guarantor or any other business entity provided for by a plan or reorganization; and
	(2) debt securities of the Company or any Guarantor or any other business entity provided for by a plan of reorganization that are subordinated to all Senior Debt and any debt securities issued in exchange for Senior Debt to the same extent as, or to a greater extent than, the Notes and the Note Guarantees are subordinated to Senior Debt under the Indenture.

	(1) all Indebtedness of such Person outstanding under the Credit Agreement and all Hedging Obligations with respect thereto, whether outstanding on the Issue Date or Incurred thereafter;
	(2) any other Indebtedness of such Person permitted to be Incurred under the terms of the Indenture, unless the instrument under which such Indebtedness is Incurred expressly provides that it is on a parity with or is subordinated in right of payment to the Notes or any Note Guarantee; and
	(3) all Obligations with respect to the items listed in the preceding clauses (1) and (2) (including any interest accruing subsequent to the filing of a petition of bankruptcy at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable law).

	(1) any liability for federal, state, local or other taxes owed or owing by the Company or any Guarantor;
	(2) any Indebtedness of the Company or any Guarantor to any of their Subsidiaries or other Affiliates;
	(3) any trade payables;
	(4) the portion of any Indebtedness that is Incurred in violation of the Indenture, provided that a good faith determination by the Board of Directors of the Company evidenced by a Board Resolution, or a good faith determination by the Chief Financial Officer of the Company evidenced by an officer’s certificate, that any Indebtedness being incurred under the Credit Agreement is permitted by the Indenture will be conclusive;
	(5) any Indebtedness of the Company or any Guarantor that, when Incurred, was without recourse to the Company or such Guarantor;
	(6) any repurchase, redemption or other obligation in respect of Disqualified Stock or Preferred Stock; or
	(7) any Indebtedness owed to any employee of the Company or any of its Subsidiaries.

	(1) at least 65% of the aggregate principal amount of Notes issued under the Indenture (including any Additional Notes) remains outstanding immediately after the occurrence of such redemption (excluding Notes held by the Company or its Affiliates); and
	(2) the redemption must occur within 45 days of the date of the closing of such Equity Offering.

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Year		Percentage
2009			104.625	%
2010			102.313	%
2011 and thereafter			100.000	%

	(1) if the Notes are listed on any national securities exchange, in compliance with the requirements of such principal national securities exchange; or
	(2) if the Notes are not so listed, on a pro rata basis, by lot or by such method as the Trustee will deem fair and appropriate.

	Change of Control

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	(1) accept for payment all Notes or portions thereof properly tendered pursuant to the Change of Control Offer;
	(2) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions thereof so tendered; and
	(3) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company.

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	Asset Sales

	(1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale at least equal to the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of; and
	(2) at least 75% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of cash, Cash Equivalents or Replacement Assets or a combination of both. For purposes of this provision, each of the following will be deemed to be cash:

	(a) any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet) of the Company or any Restricted Subsidiary (other than contingent liabilities, Indebtedness that is by its terms subordinated to the Notes or any Note Guarantee and liabilities to the extent owed to the Company or any Affiliate of the Company) that are assumed by the transferee of any such assets or Equity Interests pursuant to a written novation agreement that releases the Company or such Restricted Subsidiary from further liability therefor;
	(b) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are contemporaneously (subject to ordinary settlement periods) converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in that conversion); and
	(c) any Designated Non-Cash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Sale having an aggregated Fair Market Value, taken together with all other Designated Non-Cash consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of (x) 5.0% of the Company’s Consolidated Net Assets as of the date or receipt of such Designated Non-Cash Consideration and (y) $15.0 million (with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value).

	(1) to repay Senior Debt and, if the Senior Debt repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto; or
	(2) to purchase Replacement Assets (or enter into a binding agreement to purchase such Replacement Assets; provided that (x) such purchase is consummated within 90 days after the date of such binding agreement and (y) if such purchase is not consummated, within the period set forth in subclause (x), the Net Proceeds not so applied will be deemed to be Excess Proceeds (as defined below)).

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	Restricted Payments

	(1) declare or pay (without duplication) any dividend or make any other payment or distribution on account of the Company’s or any of its Restricted Subsidiaries’ Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving the Company or any of its Restricted Subsidiaries) or to the direct or indirect holders of the Company’s or any of its Restricted Subsidiaries’ Equity Interests in their capacity as such (other than dividends, payments or distributions (x) payable in Equity Interests (other than Disqualified Stock) of the Company or (y) to the Company or a Restricted Subsidiary of the Company);
	(2) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving the Company or any of its Restricted

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	Subsidiaries) any Equity Interests of the Company, or any Restricted Subsidiary thereof held by Persons other than the Company or any of its Restricted Subsidiaries;
	(3) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness that is subordinated to the Notes or any Note Guarantees, except (a) a payment of interest or principal at the Stated Maturity thereof or (b) the purchase, repurchase or other acquisition of any such Indebtedness in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of such purchase, repurchase or other acquisition; or
	(4) make any Restricted Investment (all such payments and other actions set forth in clauses (1) through (4) above being collectively referred to as “Restricted Payments”),

	(1) no Default or Event of Default will have occurred and be continuing or would occur as a consequence thereof; and
	(2) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to Incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described below under the caption “— Incurrence of Indebtedness”; and
	(3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the Issue Date (excluding Restricted Payments permitted by clauses (3), (4), (5), (6) and (10) of the next succeeding paragraph (B)), is less than the sum, without duplication, of:

	(a) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from the beginning of the first fiscal quarter commencing after the Issue Date to the end of the Company’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit), plus
	(b) 100% of the aggregate net cash proceeds and the Fair Market Value of assets other than cash received by the Company since the Issue Date as a contribution to its common equity capital or from the issue or sale of Equity Interests (other than Disqualified Stock) of the Company or from the Incurrence of Indebtedness of the Company that has been converted into or exchanged for such Equity Interests (other than Equity Interests sold to, or Indebtedness held by, a Subsidiary of the Company), plus
	(c) with respect to Restricted Investments made by the Company and its Restricted Subsidiaries after the Issue Date, an amount equal to the net reduction in such Restricted Investments in any Person resulting from repayments of loans or advances, or other transfers of assets, in each case to the Company or any Restricted Subsidiary or from the net cash proceeds from the sale of any such Restricted Investment (except, in each case, to the extent any such payment or proceeds are included in the calculation of Consolidated Net Income), from the release of any Guarantee (except to the extent any amounts are paid under such Guarantee) or from redesignations of Unrestricted Subsidiaries as Restricted Subsidiaries, not to exceed, in each case, the amount of Restricted Investments previously made by the Company or any Restricted Subsidiary in such Person or Unrestricted Subsidiary after the Issue Date; plus
	(d) the amount by which Indebtedness of the Company is reduced on the Company’s most recent quarterly balance sheet upon the conversion or exchange subsequent to the Issue Date of any Indebtedness of the Company convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Company (less the amount of any cash or the Fair Market Value of any other property distributed by the Company upon such conversion or exchange) plus the amount of any cash

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received by the Company upon such conversion or exchange; provided, however, that such amount may not exceed the net proceeds received by the Company or any of its Restricted Subsidiaries from the conversion or exchange of such Indebtedness (excluding net proceeds from conversion or exchange by a Subsidiary of the Company or by an employee ownership plan or by a trust established by the Company or any of its Subsidiaries for the benefit of their employees).

	(1) the payment of any dividend within 60 days after the date of declaration thereof, if at said date of declaration such payment would have complied with the provisions of the Indenture;
	(2) the payment of any dividend by a Restricted Subsidiary of the Company to the holders of its Common Stock on a pro rata basis;
	(3) the redemption, repurchase, retirement, defeasance or other acquisition of any subordinated Indebtedness or Disqualified Stock of the Company or any Guarantor or of any Equity Interests of the Company or any Restricted Subsidiary in exchange for, or out of the net cash proceeds of a contribution to the Equity Interests (other than Disqualified Stock) of the Company or a substantially concurrent sale (other than to a Subsidiary of the Company) of, Equity Interests (other than Disqualified Stock) of the Company; provided that the amount of any such net cash proceeds that are utilized for any such redemption, repurchase, retirement, defeasance or other acquisition will be excluded from clause (3) (b) of the preceding paragraph (A);
	(4) the defeasance, redemption, repurchase or other acquisition of Indebtedness subordinated to the Notes or the Note Guarantees with the net cash proceeds from an Incurrence of Permitted Refinancing Indebtedness;
	(5) Investments acquired as a capital contribution to, or in exchange for, or out of the net cash proceeds of a substantially concurrent offering of, Equity Interests (other than Disqualified Stock) of the Company; provided that the amount of any such net cash proceeds that are utilized for any such acquisition or exchange will be excluded from clause (3) (b) of the preceding paragraph (A);
	(6) the repurchase of Capital Stock deemed to occur upon the exercise of options or warrants to the extent that such Capital Stock represents all or a portion of the exercise price thereof;
	(7) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company held by any current or former employee or director of the Company (or any of its Restricted Subsidiaries) pursuant to the terms of any employee equity subscription agreement, stock option agreement or similar agreement entered into in the ordinary course of business; provided that the aggregate price paid for all such repurchased, redeemed, acquired or retired Equity Interests in a calendar year does not exceed $2.0 million (with unused amounts in any calendar year being carried over to succeeding calendar years (without giving effect to the following proviso)) and does not exceed $6.0 million in aggregate; provided further that such amount in any calendar year may be increased by an amount not to exceed (A) the net cash proceeds received by the Company from the sale of Equity Interests (other than Disqualified Stock) of the Company to members of management or directors of the Company and its Restricted Subsidiaries that occurs after the Issue Date (to the extent such cash proceeds from the sale of such Equity Interests have not otherwise been applied to the payment of Restricted Payments) plus (B) the net cash proceeds of key man life insurance policies received by the Company and its Restricted Subsidiaries after the Issue Date, less (C) the amount of any Restricted Payments made pursuant to clauses (A) and (B) of this clause (7);
	(8) payments in respect of management fees to any of the Principals pursuant to agreements in effect on the Issue Date as described in this Registration statement in an amount not to exceed an aggregate amount of $500,000 in any calendar year;
	(9) payments of dividends on Disqualified Stock otherwise permitted under Indenture;

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	(10) cash payments in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Capital Stock of the Company;
	(11) payments of dividends on the Company’s common stock following the first bona fide underwritten public offering of common stock of the Company after the Closing Date, of up to 6% per annum of the net cash proceeds received by the Company from such public offering; provided however, that (A) at the time of payment of any such dividend, no Default will have occurred and be continuing (or result therefrom), and (B) the aggregate amount of all dividends paid under this clause (11) will not exceed the aggregate amount of net proceeds received by the Company from such public offering; and
	(12) other Restricted Payments in an aggregate amount not to exceed $10.0 million.

	Incurrence of Indebtedness

	(1) the Incurrence by the Company or any Guarantor of Indebtedness under Credit Facilities (including, without limitation, the Incurrence by the Company and the Guarantors of Guarantees thereof) in an aggregate amount at any one time outstanding pursuant to this clause (1) not to exceed $200.0 million, less the aggregate amount of all Net Proceeds of Asset Sales applied by the Company or any Restricted Subsidiary thereof to permanently repay any such Indebtedness pursuant to the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales”; provided that a Restricted Subsidiary that is not a Domestic Subsidiary or a Guarantor of Indebtedness under the Credit Facilities may incur Indebtedness pursuant to this clause (1), together with Indebtedness Incurred pursuant to clause (9) of this “Incurrence of Indebtedness” covenant, in an aggregate amount, after giving effect to such Incurrence, at any time outstanding not to exceed the greater of (a) $25.0 million or (b) 40% of the aggregate Consolidated Net Assets of such Restricted Subsidiaries;
	(2) the Incurrence of Existing Indebtedness;
	(3) the Incurrence by the Company and the Guarantors of Indebtedness represented by the Notes and the related Note Guarantees to be issued on the Issue Date;
	(4) the Incurrence by the Company or any Guarantor of Indebtedness represented by Capital Lease Obligations, mortgage financings, construction loans or purchase money obligations for property acquired in the ordinary course of business, in each case Incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used by the Company or any such Guarantor, in an aggregate amount, including all Permitted Refinancing Indebtedness Incurred to refund, refinance or replace any Indebtedness Incurred pursuant to this clause (4), not to exceed 7.5% of the Company’s Consolidated Net Assets at any time outstanding;

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	(5) the Incurrence by the Company or any Restricted Subsidiary of the Company of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to refund, refinance or replace Indebtedness (other than intercompany Indebtedness) that was permitted by the Indenture to be Incurred under the first paragraph of this covenant or clause (2), (3), (4), (5), or (10) of this paragraph;
	(6) the Incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness owing to and held by the Company or any of its Restricted Subsidiaries; provided, however, that:

	(a) if the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations with respect to the Notes, in the case of the Company, or the Note Guarantee, in the case of a Guarantor;
	(b) Indebtedness owed to the Company or any Guarantor must be evidenced by an unsubordinated promissory note, unless the obligor under such Indebtedness is the Company or a Guarantor; and
	(c) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary thereof and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either the Company or a Restricted Subsidiary thereof, will be deemed, in each case, to constitute an Incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6);

	(7) the Guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of the Company that was permitted to be Incurred by another provision of this covenant; or
	(8) the Incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations that are Incurred for the purpose of fixing, hedging or swapping interest rate, commodity price or foreign currency exchange rate risk (or to reverse or amend any such agreements previously made for such purposes), and not for speculative purposes, and that do not increase the Indebtedness of the obligor outstanding at any time other than as a result of fluctuations in interest rates, commodity prices or foreign currency exchange rates or by reason of fees, indemnities and compensation payable thereunder;
	(9) the Incurrence by any Restricted Subsidiary other than a Domestic Subsidiary of Indebtedness in an aggregate amount at any time outstanding, after giving effect to such Incurrence and together with any Indebtedness Incurred under the proviso in clause (1) of this “Incurrence of Indebtedness” covenant, not to exceed the greater of (a) $25 million or (b) 40% of the Consolidated Net Assets of any such Restricted Subsidiaries; or
	(10) the Incurrence by the Company or any Guarantor of additional Indebtedness in an aggregate amount at any time outstanding, including all Permitted Refinancing Indebtedness Incurred to refund, refinance or replace any Indebtedness Incurred pursuant to this clause (10), not to exceed the greater of (a) $15.0 million or (b) 5% of the Consolidated Net Assets of the Company.

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	Limitation on Senior Subordinated Debt

	Liens

	Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries

	(1) pay dividends or make any other distributions on its Capital Stock (or with respect to any other interest or participation in, or measured by, its profits) to the Company or any of its Restricted Subsidiaries or pay any liabilities owed to the Company or any of its Restricted Subsidiaries;
	(2) make loans or advances to the Company or any of its Restricted Subsidiaries; or
	(3) transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries.

	(1) existing under, by reason of or with respect to the Credit Agreement, Existing Indebtedness or any other agreements in effect on the Issue Date and any amendments, modifications, restatements, renewals, extensions, supplements, refundings, replacements or refinancings thereof, provided that the encumbrances and restrictions in any such amendments, modifications, restatements, renewals, extensions, supplements, refundings, replacement or refinancings are no more restrictive, taken as a whole, than those contained in the Credit Agreement, Existing Indebtedness or such other agreements, as the case may be, as in effect on the Issue Date;
	(2) set forth in the Indenture, the Notes and the Note Guarantees;
	(3) existing under, by reason of or with respect to applicable law;
	(4) with respect to any Person or the property or assets of a Person acquired by the Company or any of its Restricted Subsidiaries existing at the time of such acquisition and not incurred in connection with or in contemplation of such acquisition, which encumbrance or restriction is not applicable to any Person or the properties or assets of any Person, other than the Person, or the property or assets of the

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	Person so acquired and any amendments, modifications, restatements, renewals, extensions, supplements, refundings, replacements or refinancings thereof; provided that the encumbrances and restrictions in any such amendments, modifications, restatements, renewals, extensions, supplements, refundings, replacement or refinancings are no more restrictive, taken as a whole, than those in effect on the date of the acquisition;
	(5) in the case of clause (3) of the first paragraph of this covenant:

	(A) that restrict in a customary manner the subletting, assignment or transfer of any property or asset that is a lease, license, conveyance or contract or similar property or asset,
	(B) existing by virtue of any transfer of, agreement to transfer, option or right with respect to, or Lien on, any property or assets of the Company or any Restricted Subsidiary thereof not otherwise prohibited by the Indenture;
	(C) any encumbrance or restriction arising or existing by reason of construction loans or purchase money obligations for property acquired in the ordinary course of business and Capital Lease Obligations, in each case to the extent permitted under the Indenture;
	(D) customary restrictions imposed on the transfer of intellectual property in connection with licenses of such intellectual property in the ordinary course of business;
	(E) encumbrances or restrictions existing under or by reason of provisions with respect to the disposition or distribution of assets or property in joint venture agreements and other similar agreements, in each case to the extent permitted under the Indenture, so long as any such encumbrances or restrictions are not applicable to any Person (to its property or assets) other than such joint venture or a Subsidiary thereof; or
	(F) arising or agreed to in the ordinary course of business, not relating to any Indebtedness, and that do not, individually or in the aggregate, detract from the value of property or assets of the Company or any Restricted Subsidiary thereof in any manner material to the Company or any Restricted Subsidiary thereof;

	(6) existing under, by reason of or with respect to any agreement for the sale or other disposition of all or substantially all of the Capital Stock of, or property and assets of, a Restricted Subsidiary that restrict distributions by that Restricted Subsidiary pending such sale or other disposition; and
	(7) on cash or other deposits or net worth imposed by customers or required by insurance, surety or bonding companies, in each case, under contracts entered into in the ordinary course of business.

	Merger, Consolidation or Sale of Assets

	(1) either: (a) the Company is the surviving Person; or (b) the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, conveyance or other disposition will have been made (i) is a Person organized or existing under the laws of the United States, any state thereof or the District of Columbia and (ii) assumes all the obligations of the Company under the Notes, the Indenture and, to the extent applicable, the Registration Rights Agreement pursuant to agreements reasonably satisfactory to the Trustee;
	(2) immediately after giving effect to such transaction no Default or Event of Default exists;
	(3) immediately after giving effect to such transaction on a pro forma basis, the Company or the Person formed by or surviving any such consolidation or merger (if other than the Company), or to which such sale, assignment, transfer, conveyance or other disposition will have been made, will be

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	permitted to Incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described above under the caption “— Incurrence of Indebtedness.”
	(4) each Guarantor, unless such Guarantor is the Person with which the Company has entered into a transaction under this covenant, will have by amendment to its Note Guarantee confirmed that its Note Guarantee will apply to the obligations of the Company or the surviving Person in accordance with the Notes and the Indenture.
	(5) the Company delivers to the Trustee an Officers’ Certificate (attaching the arithmetic computation to demonstrate compliance with clause (3) above) and Opinion of Counsel, in each case stating that such transaction and such agreement complies with this covenant and that all conditions precedent provided for in this covenant relating to such transaction have been complied with.

	Transactions with Affiliates

	(1) such Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable arm’s-length transaction by the Company or such Restricted Subsidiary with a Person that is not an Affiliate of the Company or any of its Restricted Subsidiaries; and
	(2) the Company delivers to the Trustee:

	(a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $5.0 million, a Board Resolution set forth in an Officers’ Certificate certifying that such Affiliate Transaction or series of related Affiliate Transactions complies with this covenant, and that such Affiliate Transaction or series of related Affiliate Transactions has been approved by a majority of the disinterested members of the Board of Directors of the Company; and
	(b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $25.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary of such Affiliate Transaction or series of related Affiliate Transactions from a financial point of view issued by an independent accounting, appraisal or investment banking firm of national standing.

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	(1) transactions between or among the Company and/or its Restricted Subsidiaries;
	(2) payment of reasonable and customary fees to, and reasonable and customary indemnification and similar payments on behalf of, directors of the Company;
	(3) Restricted Payments that are permitted by the provisions of the Indenture described above under the covenants described under the caption “— Restricted Payments” including, without limitation, payments included in the definition of “Permitted Investments”; and
	(4) any sale of Equity Interests (other than Disqualified Stock) of the Company;
	(5) the receipt by the Company of any capital contribution from its shareholders;
	(6) transactions pursuant to agreements or arrangements in effect on the Issue Date and described in this registration statement, or any amendment, modification, or supplement thereto or replacement thereof, as long as such agreement or arrangement, as so amended, modified or supplemented or replaced, taken as a whole, is not more disadvantageous to the Company and its Restricted Subsidiaries than the original agreements or arrangements in existence on the Issue Date;
	(7) payment by the Company of management or other similar fees to any of the Principals pursuant to any agreement or arrangement in an aggregate amount not to exceed $500,000 in any calendar year; and
	(8) any employment, consulting, service or termination agreement, or reasonable and customary indemnification arrangements, entered into by the Company or any of its Restricted Subsidiaries with officers and employees of the Company or any of its Restricted Subsidiaries and the payment of compensation to officers and employees of the Company or any of its Restricted Subsidiaries (including amounts paid pursuant to employee benefit plans, employee stock option or similar plans), so long as such agreement or payment has been approved by the Board of Directors of the Company.

	Designation of Restricted and Unrestricted Subsidiaries

	(1) any Guarantee by the Company or any Restricted Subsidiary thereof of any Indebtedness of the Subsidiary being so designated will be deemed to be an Incurrence of Indebtedness by the Company or such Restricted Subsidiary (or both, if applicable) at the time of such designation, and such Incurrence of Indebtedness would be permitted under the covenant described above under the caption “— Incurrence of Indebtedness,” and any lien on the property of the Restricted Subsidiary will be permitted to exist under the covenant described above under the caption “— Liens;”
	(2) the aggregate Fair Market Value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the Subsidiary being so designated (including any Guarantee by the Company or any Restricted Subsidiary of any Indebtedness of such Subsidiary) will be deemed to be a Restricted Investment made as of the time of such designation and that such Investment would be permitted under the covenant described above under the caption “— Restricted Payments”;
	(3) the Subsidiary being so designated:

(a) except as permitted by the covenant described above under the caption “— Transaction with Affiliates,” is not party to any agreement, contract, arrangement or understanding with the Company or any Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Company;

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	(b) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation (i) to subscribe for additional Equity Interests or (ii) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results; and
	(c) has not Guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any of its Restricted Subsidiaries, except to the extent such Guarantee or credit support would be released upon such designation; and

	(4) no Default or Event of Default would be in existence following such designation.

	(1) such designation will be deemed to be an Incurrence of Indebtedness by a Restricted Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation will only be permitted if such Indebtedness is permitted under the covenant described under the caption “— Incurrence of Indebtedness;”
	(2) all outstanding Investments owned by such Unrestricted Subsidiary will be deemed to be made as of the time of such designation and such designation will only be permitted if such Investments would be permitted under the covenant described above under the caption “— Restricted Payments”;
	(3) all Liens upon property or assets of such Unrestricted Subsidiary existing at the time of such designation would be permitted under the covenant described under the caption “— Liens”; and
	(4) no Default or Event of Default would be in existence following such designation.

	Limitation on Issuances and Sales of Preferred Stock in Restricted Subsidiaries

	(1) such transfer, conveyance, sale, lease or other disposition is of all the Equity Interest in such Restricted Subsidiary owned by the Company and its Restricted Subsidiaries; and
	(2) the cash Net Proceeds from such transfer, conveyance, sale, lease or other disposition are applied in accordance with the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales.”

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	Guarantees

	(1) immediately after giving effect to that transaction, no Default or Event of Default exists; and
	(2) either:

	(a) the Person acquiring the property in any such sale or disposition or the Person formed by or surviving any such consolidation or merger (if other than the Guarantor) is organized or existing under the laws of the United States, any state thereof or the District of Columbia and assumes all the obligations of that Guarantor under the Indenture, its Note Guarantee and the Registration Rights Agreement pursuant to a supplemental indenture satisfactory to the Trustee; or
	(b) such sale or other disposition or consolidation or merger complies with the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales.”

	(1) in connection with any sale or other disposition of all of the Capital Stock of a Guarantor to a Person that is not (either before or after giving effect to such transaction) a Restricted Subsidiary of the Company, if the sale of all such Capital Stock of that Guarantor complies with the covenant described above under the caption “— Repurchase at the Option of Holders — Asset Sales”;
	(2) if the Company properly designates any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary under the Indenture; or
	(3) solely in the case of a Note Guarantee created pursuant to the second paragraph of this covenant, upon the release or discharge of the Guarantee which resulted in the creation of such Note Guarantee pursuant to this covenant, except a discharge or release by or as a result of payment under such Guarantee.

	Business Activities

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	Payments for Consent

	Reports

	(1) all quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K if the Company were required to file such Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and, with respect to the annual information only, a report on the annual financial statements by the Company’s certified independent accountants; and
	(2) all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file such reports.

	(1) default for 30 days in the payment when due of interest on, or Additional Interest with respect to, the Notes whether or not prohibited by the subordination provisions of the Indenture;

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	(2) default in payment when due (whether at maturity, upon acceleration, redemption or otherwise) of the principal of, or premium, if any, on the Notes, whether or not prohibited by the subordination provisions of the Indenture;
	(3) failure by the Company or any of its Restricted Subsidiaries to consummate a purchase of the Notes when required by the provisions described under the captions “— Repurchase at the Option of Holders — Change of Control,” or “— Repurchase at the Option of Holders — Asset Sales” or failure to comply with “— Certain Covenants — Merger, Consolidation or Sale of Assets”;
	(4) failure by the Company or any of its Restricted Subsidiaries for 60 days after written notice by the Trustee or Holders representing 25% or more of the aggregate principal amount of Notes outstanding to comply with any of the other agreements in the Indenture;
	(5) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary (or any Restricted Subsidiaries that together would constitute a Significant Subsidiary) (or the payment of which is Guaranteed by the Company or any of its Restricted Subsidiaries) whether such Indebtedness or Guarantee now exists, or is created after the Issue Date, if that default:

	(a) is caused by a failure to make any payment when due at the final maturity of such Indebtedness (a “Payment Default”); or
	(b) results in the acceleration of such Indebtedness prior to its express maturity,

	and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $10.0 million or more;

	(6) failure by the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary (or any Restricted Subsidiaries that together would constitute a Significant Subsidiary) to pay final judgments (to the extent such judgments are not paid or covered by insurance provided by a reputable carrier that has the ability to perform and has acknowledged coverage in writing) aggregating in excess of $10.0 million, which judgments are not paid, discharged or stayed for a period of 60 days;
	(7) except as permitted by the Indenture, any Note Guarantee will be held in any judicial proceeding to be unenforceable or invalid or will cease for any reason to be in full force and effect or any Guarantor, or any Person acting on behalf of any Guarantor, will deny or disaffirm its obligations under its Note Guarantee; and
	(8) certain events of bankruptcy or insolvency with respect to the Company, any Guarantor or any Restricted Subsidiary that is a Significant Subsidiary of the Company (or any Restricted Subsidiaries that together would constitute a Significant Subsidiary).

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	(1) the Holder gives the Trustee written notice of a continuing Event of Default;
	(2) the Holders of at least 25% in aggregate principal amount of outstanding Notes make a written request to the Trustee to pursue the remedy;
	(3) such Holder or Holders offer the Trustee indemnity satisfactory to the Trustee against any costs, liability or expense;
	(4) the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity; and
	(5) during such 60-day period, the Holders of a majority in aggregate principal amount of the outstanding Notes do not give the Trustee a direction that is inconsistent with the request.

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	(1) the rights of Holders of outstanding Notes to receive payments in respect of the principal of, or interest or premium and Additional Interest, if any, on such Notes when such payments are due from the trust referred to below;
	(2) the Company’s obligations with respect to the Notes concerning issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or stolen Notes and the maintenance of an office or agency for payment and money for security payments held in trust;
	(3) the rights, powers, trusts, duties and immunities of the Trustee, and the Company’s and the Guarantors’ obligations in connection therewith; and
	(4) the Legal Defeasance provisions of the Indenture.

	(1) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable Government Securities, or a combination thereof, in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of, or interest and premium and Additional Interest, if any, on the outstanding Notes on the Stated Maturity or on the applicable redemption date, as the case may be, and the Company must specify whether the Notes are being defeased to maturity or to a particular redemption date;
	(2) in the case of Legal Defeasance, the Company will have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that (a) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel will confirm that, the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

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	(3) in the case of Covenant Defeasance, the Company will have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that the Holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
	(4) no Default or Event of Default will have occurred and be continuing either: (a) on the date of such deposit; or (b) insofar as Events of Default from bankruptcy or insolvency events are concerned, at any time in the period ending on the 123rd day after the date of deposit (other than a Default resulting from the borrowing of funds to be applied to such deposit);
	(5) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than the Indenture) to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound;
	(6) the Company must have delivered to the Trustee an Opinion of Counsel to the effect that, (1) assuming no intervening bankruptcy of the Company or any Guarantor between the date of deposit and the 123rd day following the deposit and assuming that no Holder or the Trustee is deemed to be an “insider” of the Company under the United States Bankruptcy Code and the New York Debtor and Creditor Law, and assuming that the deposit is not otherwise deemed to be to or for the benefit of an “insider” of the Company under the United States Bankruptcy Code and the New York Debtor and Creditor Law, and assuming that no Holder or the Trustee is deemed to be an “initial transferee” or “mediate transferee” of a “transfer” within the meaning of Section 550 of the United States Bankruptcy Code, after the 123rd day following the deposit, the transfer of the trust funds pursuant to such deposit will not be subject to avoidance pursuant to Section 547 of the United States Bankruptcy Code or Section 15 of the New York Debtor and Creditor Law and (2) the creation of the defeasance trust does not violate the Investment Company Act of 1940;
	(7) the Company must deliver to the Trustee an Officers’ Certificate stating that the deposit was not made by the Company with the intent of preferring the Holders of Notes over the other creditors of the Company with the intent of defeating, hindering, delaying or defrauding creditors of the Company or others; and
	(8) the Company must deliver to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

	(1) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver;
	(2) reduce the principal of or change the fixed maturity of any Note or alter the provisions, or waive any payment, with respect to the redemption of the Notes (other than any provision with respect to the covenant described under the caption “Repurchase at the Options of Holders — Asset Sales” or

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	“Repurchase at the Option of Holders — Change of Control” or “Merger, Consolidation and Sale of Assets”);
	(3) reduce the rate of, or change the time for payment of, interest on any Note;
	(4) waive a Default or Event of Default in the payment of principal of, or interest, or premium or Additional Interest, if any, on, the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the Notes and a waiver of the payment default that resulted from such acceleration);
	(5) make any Note payable in money other than U.S. dollars;
	(6) make any change in the provisions of the Indenture relating to waivers of past Defaults or the rights of Holders of Notes to receive payments of principal of, or interest or premium or Additional Interest, if any, on, the Notes;
	(7) release any Guarantor from any of its obligations under its Note Guarantee or the Indenture, except in accordance with the terms of the Indenture;
	(8) impair the right to institute suit for the enforcement of any payment on or with respect to the Notes or the Note Guarantees;
	(9) except as otherwise permitted under the covenants described under the captions “— Certain Covenants — Guarantees,” consent to the assignment or transfer by the Company or any Guarantor of any of their rights or obligations under the Indenture; or
	(10) make any change in the preceding amendment and waiver provisions.

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	(1) to cure any ambiguity, defect or inconsistency;
	(2) to provide for uncertificated Notes in addition to or in place of certificated Notes;
	(3) to provide for the assumption of the Company’s or any Guarantor’s obligations to Holders of Notes in the case of a merger or consolidation or sale of all or substantially all of the Company’s or such Guarantor’s assets;
	(4) to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not materially adversely affect the legal rights under the Indenture of any such Holder, including the addition of any new Note Guarantee;
	(5) to comply with requirements of the Commission in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act;
	(6) to comply with the provisions described under “— Certain Covenants — Guarantees,” including to reflect the release of a Guarantee of the Notes in accordance with the Indenture;