Under a
turnkey 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 does not require a trained service
technician. Under our turnkey operations, 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, under turnkey
agreements 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. Under a turnkey arrangement, we pay a
commission on a per-transaction basis to the merchant on whose premises the
ATM is physically located. At no time will we ask the merchant for money.
Under turnkey arrangements, we are responsible for purchasing the ATM, as well
as almost all of the expenses related to its operation. Approximately 91% of
the ATMs we have acquired since Dec 2003 are operated under turnkey
arrangements. We believe this is important because (1) turnkey locations
generally offer higher transaction volumes and greater profitability, and (2)
turnkey locations are controlled by us, and are thus more likely candidates
for additional sources of revenue.