Exhibit 10.5

EXHIBIT A
 
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933,
AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND ARE “RESTRICTED SECURITIES”
AS THAT TERM IS DEFINED IN RULE 144 UNDER THE SECURITIES ACT. SUCH SECURITIES
MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND THE
APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
THEREUNDER, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE REASONABLE
SATISFACTION OF COUNSEL TO THE ISSUER.
 
$__________________, 2006
 
8% SENIOR SECURED PROMISSORY NOTE
 
1. Obligation. For value received, VENDINGDATA CORPORATION, a Nevada corporation
(“Maker”), promises to pay to __________________ ("Holder"), the Principal
Amount and Interest (both as defined below) in the manner and upon the terms and
conditions set forth herein.
 
2. Principal Amount and Interest. The principal amount (“Principal Amount”) of
this Note is __________ Dollars ($_______). This Note shall bear interest on the
unpaid Principal Amount at the rate of eight percent (8%) per annum
(“Interest”). The Principal Amount shall be payable as follows: (i) four
installments of $_____________ [RATABLE PORTION OF $1.5 MILLION] on each of May
2, 2007, 2008, 2009 and 2010, subject to adjustment as set forth in Section 4.11
of the Note Purchase Agreement (defined below), and (ii) the balance due and
payable on March 31, 2011. The accrued and unpaid Interest shall be paid in
semi-annual installments, commencing on June 1, 2006 and continuing thereafter
on each June 1st and December 1st until all amounts owing under this Note are
paid in full.
 
3. Manner and Place of Payment. Payments of the Principal Amount and Interest
shall be made in lawful money of the United States of America. Principal and
Interest are payable at _______________________ or at such other place as Holder
may designate in writing.
 
4. Prepayment. Maker shall have the right, at any time or from time to time, to
prepay, in whole or in part, the unpaid Principal Amount of this Note, without
penalty or premium.
 
5. 8% Senior Secured Promissory Note; Security Agreement. This Note is being
delivered under that certain 8% Senior Secured Note Purchase Agreement (“Note
Purchase Agreement”) between Maker and Holder dated May 1, 2006. Maker’s
obligations under this Note are subject to a security interest in the assets of
Maker, pursuant to that certain Security Agreement (“Security Agreement”) dated
May 1, 2006 entered into between Maker and Holder.
 

1

--------------------------------------------------------------------------------

 
6. Events of Default. The following shall each constitute an “Event of Default”
under this Note: (i) default in the payment when due of any amount required
hereunder, (ii) default in Maker’s performance of any other obligation hereunder
or under the Security Agreement, the Note Purchase Agreement, the Registration
Rights Agreement or the Warrant that remains uncured ten days after receipt of
written notice of default, or (iii) any of the following events of bankruptcy or
insolvency: (A) the Maker shall file a voluntary bankruptcy or reorganization
petition under the provisions of the Federal Bankruptcy Act, any other
bankruptcy or insolvency law or any other similar statute applicable to the
Maker (“Bankruptcy Laws”), (B) the Maker shall consent to the filing of any
bankruptcy or reorganization petition against it under any Bankruptcy Law, (C)
the Maker shall make an assignment for the benefit of his creditors, (D) the
Maker shall admit in writing its inability to pay its debts generally as they
become due, (E) the Maker shall consent to the appointment of a receiver,
trustee, or by the order of a court of competent jurisdiction, a receiver,
liquidator or trustee of the Maker or of any substantial part of its property
shall not have been discharged within a period of sixty (60) days, (F) by decree
of such a court, the Maker shall be adjudicated bankrupt or insolvent or any
substantial part of the property of the Maker shall have been sequestered and
such degree shall have continued undischarged and unstayed for a period of sixty
(60) days after the entry thereof, or (G) an involuntary bankruptcy
reorganization petition pursuant to any Bankruptcy Law shall be filed against
the Maker (and, in the case of any such petition filed pursuant to any provision
of a statute which requires the approval of such petition by a court, shall be
approved by such a court) and shall not be dismissed within sixty (60) days
after such filing.
 
7. Acceleration Upon Event of Default or Change in Control. Upon the occurrence
of an Event of Default specified in Section 6 above or a Change in Control (as
defined below), the entire Principal Amount and all Interest shall, at the
option of Holder evidenced by a written notice to Maker, become immediately due
and payable, without further presentment, notice or demand for payment. For
purposes of this Note, a “Change in Control” shall mean the occurrence of any of
the following events: (i) a sale of all or substantially all of the assets of
the Maker; (ii) a liquidation or dissolution of the Maker; (iii) a merger or
consolidation in which the Maker is not the surviving corporation, unless the
stockholders of the Maker immediately prior to such consolidation, merger or
reorganization, own more than 50% of the Maker’s voting power immediately after
such; (iv) a reverse merger in which the Maker is the surviving corporation but
the shares of Common Stock and securities convertible into Common Stock
outstanding immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash or
otherwise; (v) any consolidation or merger of the Maker, or any other corporate
reorganization, in which the stockholders of the Maker immediately prior to such
consolidation, merger or reorganization, own less than 50% of the Maker’s voting
power immediately after such consolidation, merger or reorganization; or
(vi) any Person other than James Crabbe becomes the owner, directly or
indirectly, of securities of the Maker representing more than 50% of the
combined voting power of the Maker’s then outstanding securities; provided,
however, that a “Change in Control” shall not include any transaction the sole
purpose of which is to change the state of the Maker’s incorporation. 
 
8. Expenses of Enforcement. Maker agrees to pay all reasonable costs and
expenses, including, without limitation, reasonable attorneys’ fees, as a court
of competent jurisdiction shall award, which Holder shall incur in connection
with any legal action or legal proceeding commenced for the collection of this
Note or the exercise, preservation or enforcement of Holder’s rights and
remedies thereunder.
 

2

--------------------------------------------------------------------------------

 
9. Cumulative Rights and Remedies. All rights and remedies of Holder under this
Note shall be cumulative and not alternative and shall be in addition to all
rights and remedies available to Holder under applicable law.
 
10. Governing Law. This Note shall be governed by and interpreted and construed
in accordance with the laws of the State of Nevada.
 
11. Notices and Demands. Any notice or demand which by any provision of this
Note is required or provided to be given shall be in writing and shall be deemed
to have been given or served sufficiently for all purposes if sent as provided
in the Note Purchase Agreement or through a nationally-recognized overnight
courier and simultaneously transmitted by facsimile to the following respective
addresses and facsimile telephone numbers:
 
Maker:   VendingData Corporation.
6830 Spencer Street
Las Vegas, NV 89119
Attention: Mark R. Newburg,
President and Chief Executive Officer
Facsimile: (702) 733-7197

or at any other address designated by Maker to Holder in writing.
 
Holder:  

Attention:
Facsimile:
 
or at any other address designated by Holder to Maker in writing, and if to an
assignee of Holder, to its address as designated to Maker in writing.
 
IN WITNESS WHEREOF, Maker has caused this Note to be executed and delivered at
Las Vegas, Nevada effective as of the day and year first above written.
 

 
VENDINGDATA CORPORATION

By:         
Mark R. Newburg,

President and Chief Executive Officer

3

--------------------------------------------------------------------------------