Exhibit
      10.3

     

    
       

      SECURITY
        AGREEMENT

       

       

      This
        Security Agreement (“Agreement”)
        is
        entered into effective as of March 29, 2006 by and between VendingData
        Corporation, a Nevada corporation (“Grantor”),
        and
        Bricoleur Partners, L.P., Bricoleur Enhanced, L.P., BRIC 6, L.P. and Bricoleur
        Offshore Ltd. (“Secured
        Parties”).

       

      RECITALS

       

      A. The
        Grantor and the Secured Parties are parties to a 7% Senior Secured Note Purchase
        Agreement of even date herewith (the “Note
        Purchase Agreement”)
        under
        which the Grantor has issued certain 7% Senior Secured Promissory Notes (
        each a
“Note”)
        of
        even date in favor of the Secured Parties in the aggregate original principal
        amount of $7,000,000. 

       

      B. As
        a
        condition to extending credit to the Grantor under the Notes, the Secured
        Parties have required the execution and delivery of this Agreement by the
        Grantor.

       

      AGREEMENT

       

      NOW,
        THEREFORE, for good and valuable consideration, the receipt and adequacy
        of
        which hereby is acknowledged, Grantor hereby represents, warrants, covenants,
        agrees, assigns and grants as follows:

       

      1. Definitions.

       

      1.1 Unless
        the context otherwise requires, terms defined in the Uniform Commercial Code
        of
        the State of Nevada (the “Uniform
        Commercial Code”)
        and
        not otherwise defined in this Agreement shall have the meanings defined for
        those terms in the Uniform Commercial Code. 

       

      1.2 “Collateral”
means
        and includes all present and future right, title and interest of Grantor
        in and
        to all of the assets of the Grantor, wherever located and whether presently
        owned or after acquired, including but not limited to: 

       

      a. All
        accounts receivable, contract rights and general intangibles, including,
        without
        limitation, all forms of payment, goodwill, license rights, bailment or
        leasehold interests, whether as lessor or lessee, inventions, designs,
        trademarks, trade styles, trade names, trade secrets, formulas, patents,
        patent
        applications, tax refunds, customer lists, business and accounting records,
        including all ledger account cards, computer tapes and discs and other computer
        information, in all cases whether now owned or hereafter created or acquired
        by
        Grantor or in which Grantor may now have or may hereafter acquire an
        interest;

       

      
        
          
          

        

        
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      b. All
        equipment, including, without limitation, machinery, furniture, furnishings,
        fixtures, tools, parts, supplies and vehicles of every kind and description,
        whether now owned or hereafter acquired by Grantor in which Grantor may now
        have
        or may hereafter acquire an interest, and all additions, accessions,
        replacements, substitutions and improvements thereto and wherever
        located;

       

      c. All
        documents, documents of title, deposit accounts, instruments, money, letters
        of
        credit and chattel paper whether now owned or hereafter acquired by Grantor;
        

       

      d. All
        other
        intellectual property of Grantor, including, but not limited to, all (i)
        patents, patent applications and inventions and discoveries that may be
        patentable, (ii) all copyrights in both published works and unpublished works;
        and (iii) all rights in mask works, know-how, trade secrets, confidential
        information, customer files, software, technical information, data. process
        technology, plans, drawings, and blue prints; and 

       

      e. All
        proceeds and products of any of the foregoing, in any form, including, without
        limitation, proceeds of any insurance relating thereto, proceeds consisting
        of
        any of the above types of collateral, and proceeds of any tort cause of action
        now or hereafter in existence, and all replacements, substitutions, renewals,
        returns, additions, accessions, rents, royalties, issues, documents of ownership
        and receipts for any of the foregoing. 

       

      “Lien”
means
        any security interest, mortgage, deed of trust, pledge, lien, charge,
        encumbrance, title retention agreement or analogous instrument or device,
        including the interest of each lessor under any capitalized lease and the
        interest of any bondsman under any payment or performance bond, in, of or
        on any
        assets or properties of a person, whether now owned or hereafter acquired
        and
        whether arising by agreement or operation of law.

       

      “Permitted
        Liens”
means
        (i) the Security Interest, (ii) covenants, restrictions, rights,
        easements and minor irregularities in title which do not materially interfere
        with the Grantor’s business or operations as presently conducted, and (iii)
        Liens in existence on the date hereof and described on Exhibit
        B
        hereto.

       

      2. Creation
        of Security Interest.
        Grantor
        hereby grants to Secured Parties to the extent permitted by law a security
        interest in and to all right, title and interest of Grantor in and to all
        presently existing and hereafter acquired Collateral. The security interest
        and
        pledge created by this Section 2 shall continue in effect so long as any of
        the Obligations (as defined below) remains unpaid. 

       

      3. Security
        for Obligations.
        This
        Agreement and the security interests granted herein secure the prompt payment,
        in full in cash, and full performance of, all obligations (“Obligations”) of the
        Secured Parties now or hereafter existing under the Notes or the Note Purchase
        Agreement.

       

      
        
          
          

        

        
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      4. Representations,
        Warranties and Agreements.
        The
        Grantor hereby represents, warrants and agrees as follows:

       

      4.1 Title.
        The
        Grantor (i) has absolute title to each item of Collateral in existence on
        the date hereof, free and clear of all Liens except the Permitted Liens,
        (ii) will have, at the time the Grantor acquires any rights in the
        Collateral hereafter arising, absolute title to each such item of the
        Collateral, free and clear of all Liens except the Permitted Liens,
        (iii) will keep all of the Collateral free and clear of all Liens except
        the Permitted Liens, and (iv) will defend the Collateral against all claims
        or demands of all persons other than the Secured Parties. The Grantor will
        not
        sell or otherwise dispose of the Collateral or any interest therein, outside
        the
        ordinary course of business, without the prior written consent of the Secured
        Parties.

       

      4.2 Chief
        Executive Office; Identification Number.
        The
        Grantor’s chief executive office and principal place of business is located at
        the address set forth under its signature below. The Grantor’s federal employer
        identification number and organizational identification number is correctly
        set
        forth under its signature below. 

       

      4.3 Location
        of the Collateral.
        As of
        the date hereof, the tangible Collateral is located only in the state and
        at the
        address(es) identified on Exhibit
        A
        attached
        hereto. The Grantor will not permit any tangible Collateral to be located
        in any
        state (and, if county filing is required, in any county) in which a financing
        statement covering such Collateral is required to be, but has not in fact
        been,
        filed in order to perfect the Security Interest. 

       

      4.4 Changes
        in Name, Constituent Documents, Location.
        The
        Grantor will not change its name or its business address without giving prior
        written notice to the Secured Parties. 

       

      4.5 Fixtures.
        The
        Grantor will not permit any tangible Collateral to become part of or to be
        affixed to any real property without first assuring to the reasonable
        satisfaction of the Secured Parties that the Security Interest will be prior
        and
        senior to any Lien then held or thereafter acquired by any mortgagee of such
        real property or the owner or purchaser of any interest therein. 

       

      4.6 Rights
        to Payment.
        Each
        right to payment and each instrument, document, chattel paper and other
        agreement constituting or evidencing the Collateral is (or will be when arising,
        issued or assigned to the Secured Parties) the valid, genuine and legally
        enforceable obligation, subject to no defense, setoff or counterclaim (other
        than those arising in the ordinary course of business), of the account debtor
        or
        other obligor named therein or in the Grantor’s records pertaining thereto as
        being obligated to pay such obligation. The Grantor will neither agree to
        any
        material modification or amendment nor agree to any forbearance, release
        or
        cancellation of any such obligation, and will not subordinate any such right
        to
        payment to claims of other creditors of such account debtor or other obligor.
        


      
        
          
          

        

        
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      4.7 Commercial
        Tort Claims.
        Promptly upon knowledge thereof, the Grantor will deliver to the Secured
        Parties
        notice of any commercial tort claims it may bring against any person, including
        the name and address of each defendant, a summary of the facts, an estimate
        of
        the Grantor’s damages, copies of any complaint or demand letter submitted by the
        Grantor, and such other information as the Secured Parties may request. Upon
        request by the Secured Parties, the Grantor will grant the Secured Parties
        a
        security interest in all commercial tort claims it may have against any person.
        

       

      4.8 Miscellaneous
        Covenants.
        The
        Grantor will: 

       

      (i) keep
        all
        tangible Collateral in good repair, working order and condition, normal
        depreciation excepted, and will, from time to time, replace any worn, broken
        or
        defective parts thereof; 

       

      (ii) promptly
        pay all taxes and other governmental charges levied or assessed upon or against
        any Collateral or upon or against the creation, perfection or continuance
        of the
        Security Interest; 

       

      (iii) at
        all
        reasonable times, permit the Secured Parties or their representatives to
        examine
        or inspect any Collateral, wherever located, and to examine, inspect and
        copy
        the Grantor’s books and records pertaining to the Collateral and its business
        and financial condition and to send and discuss with account debtors and
        other
        obligors requests for verifications of amounts owed to the Grantor;


       

      (iv) keep
        accurate and complete records pertaining to the Collateral and pertaining
        to the
        Grantor’s business and financial condition and submit to the Secured Parties
        such periodic reports concerning the Collateral and the Grantor’s business and
        financial condition as the Secured Parties may from time to time reasonably
        request; 

       

      (v) promptly
        notify the Secured Parties of any loss of or material damage to any Collateral
        or of any adverse change known to the Grantor pertaining to the prospect
        of
        payment of any sums due on or under any instrument, chattel paper, or account
        constituting the Collateral; 

       

      (vi) if
        the
        Secured Parties at any time so request (after the occurrence and during the
        continuation of an Event of Default), promptly deliver to the Secured Parties
        any instrument, document or chattel paper constituting the Collateral, duly
        endorsed or assigned by the Grantor; 

       

      (vii) at
        all
        times keep all tangible Collateral insured against risks of fire (including
        so-called extended coverage), theft, collision (in case of the Collateral
        consisting of motor vehicles) and such other risks and in such amounts as
        the
        Secured Parties may reasonably request, with any such policies containing
        a
        lender loss payable endorsement acceptable to the Secured Parties;



      
        
          
          

        

        
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      (viii) from
        time
        to time execute such financing statements as the Secured Parties may reasonably
        require in order to perfect the Security Interest (including, without
        limitation, any filings with the United States Patent and Trademark Office,
        copyright or other intellectual property filings and any filings of financing
        or
        continuation statements under the UCC) in order to create, preserve, upgrade
        in
        rank (to the extent required hereby), perfect, confirm or validate the Security
        Interest or to enable the Secured Parties to obtain the full benefits of
        this
        Agreement, or to enable the Secured Parties to exercise and enforce any of
        its
        rights, powers and remedies hereunder with respect to any of the Collateral
        and,
        if any Collateral consists of a motor vehicle, execute such documents as
        may be
        required to have the Security Interest properly noted on a certificate of
        title;


       

      (ix) pay
        when
        due or reimburse the Secured Parties on demand for all costs of collection
        of
        any of the Obligations and all other out-of-pocket expenses (including, in
        each
        case, all reasonable attorneys’ fees) incurred by the Secured Parties in
        connection with the creation, perfection, satisfaction, protection, defense
        or
        enforcement of the Security Interest or the creation, continuance, protection,
        defense or enforcement of this Agreement or any or all of the Obligations,
        including expenses incurred in any litigation or bankruptcy or insolvency
        proceedings; 

       

      (x) execute,
        deliver or endorse any and all instruments, documents, assignments, security
        agreements and other agreements and writings which the Secured Parties may
        at
        any time reasonably request in order to secure, protect, perfect or enforce
        the
        Security Interest and the Secured Parties’ rights under this Agreement;
        and

       

      (xi) not
        use
        or keep any Collateral, or permit it to be used or kept, for any unlawful
        purpose or in violation of any federal, state or local law, statute or
        ordinance. 


      
        
          
          

        

        
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      4.9 The
        Secured Parties’ Right to Take Action.
        The
        Grantor authorizes the Secured Parties to file from time to time where permitted
        by law, such financing statements against the Collateral described as “all of
        the Grantor’s personal property” as the Secured Parties deem necessary or useful
        to perfect the Security Interest. The Grantor will not amend any financing
        statements in favor of the Secured Parties, except as permitted by law. Further,
        if the Grantor at any time fails to perform or observe any agreement contained
        in Section 4.8, and if such failure continues for a period of ten (10) days
        after the Secured Parties give the Grantor written notice thereof (or, in
        the
        case of the agreements contained in clauses (vii) and (viii) of Section 4.8,
        immediately upon the occurrence of such failure, without notice or lapse
        of
        time), the Secured Parties may (but need not) perform or observe such agreement
        on behalf and in the name, place and stead of the Grantor (or, at the Secured
        Parties’ option, in the Secured Parties’ own name) and may (but need not) take
        any and all other actions which the Secured Parties may reasonably deem
        necessary to cure or correct such failure (including, without limitation,
        the
        payment of taxes, the satisfaction of security interests, liens, or
        encumbrances, the performance of obligations under contracts or agreements
        with
        account debtors or other obligors, the procurement and maintenance of insurance,
        the execution of financing statements, the endorsement of instruments, and
        the
        procurement of repairs or transportation); and, except to the extent that
        the
        effect of such payment would be to render any loan or forbearance of money
        usurious or otherwise illegal under any applicable law, the Grantor shall
        thereupon pay the Secured Parties on demand the amount of all moneys expended
        and all costs and expenses (including reasonable attorneys’ fees) incurred by
        the Secured Parties in connection with or as a result of the Secured Parties’
performance or observation of such agreements or any actions taken thereunder,
        together with interest thereon from the date expended or incurred by the
        Secured
        Parties at the highest rate then applicable to any of the Obligations. To
        facilitate the performance or observance by the Secured Parties of such
        agreements of the Grantor, the Grantor hereby irrevocably appoints (which
        appointment is coupled with an interest) the Secured Parties, or their delegate,
        as the attorney-in-fact of the Grantor with the right (but not the duty)
        from
        time to time to create, prepare, complete, execute, deliver, endorse or file,
        in
        the name and on behalf of the Grantor, any and all instruments, documents,
        financing statements, applications for insurance and other agreements and
        writings required to be obtained, executed, delivered or endorsed by the
        Grantor
        under this Section 4. The Grantor shall pay the costs of, or incidental to,
        any
        recording or filing of any financing statements, financing statement amendments
        or continuation statements concerning the Collateral.

       

      5. Secured
        Parties’ Rights Regarding Collateral 

       

      5.1 At
        any
        time and from time to time, at the expense of Grantor, Secured Parties may,
        to
        the extent necessary or desirable to protect the security hereunder, but
        Secured
        Parties shall not be obligated to (a) notify obligors on the Collateral that
        the
        Collateral has been assigned as security to Secured Parties; (b) after an
        Event
        of Default (as defined below) has occurred and is continuing, at any time
        and
        from time to time request from obligors on the Collateral, in the name of
        Grantor or in the name of Secured Parties, information concerning the Collateral
        and the amounts owing thereon; and (c) after an Event of Default has occurred
        and is continuing, instruct obligors on the Collateral to direct their
        performance to Secured Parties. Secured Parties shall at all reasonable times
        on
        reasonable notice have full access to and the right to audit any and all
        of
        Grantor’s books and records pertaining to the Collateral, and to confirm and
        verify the value of the Collateral. Secured Parties shall be under no duty
        or
        obligation whatsoever to take any action to preserve any rights of or against
        any prior or other parties in connection with the Collateral, to exercise
        any
        voting rights or managerial rights with respect to any Collateral or to make
        or
        give any presentments for payment, demands for performance, notices of
        non-performance, protests, notices of protest, notices of dishonor or notices
        of
        any other nature whatsoever in connection with the Collateral or the
        Obligations. Secured Parties shall be under no duty or obligation whatsoever
        to
        take any action to protect or preserve the Collateral or any rights of Grantor
        therein, or to make collections or enforce payment thereon, or to participate
        in
        any foreclosure or other proceeding in connection therewith. Nothing contained
        herein shall constitute an assumption by Secured Parties of any of Grantor’s
        obligations under any contract rights unless Secured Parties shall have given
        written notice of Secured Parties’ intention to assume such contract rights.
        Grantor shall continue to be liable for performance of its obligations under
        such contracts rights. 

       

      
        
          
          

        

        
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      5.2 Collections
        on the Collateral.
        Grantor
        shall have the right to use and to continue to make collections on and receive
        dividends and other proceeds of all of the Collateral in the ordinary course
        of
        business so long as no Event of Default shall have occurred and be continuing.
        Upon the occurrence and during the continuance of an Event of Default, at
        the
        option of Secured Parties, Grantor’s right to make collections on and receive
        proceeds of the Collateral and to use or dispose of such collections and
        proceeds shall terminate, and any and all proceeds and collections, including
        all partial or total prepayments, then held or thereafter received on or
        on
        account of the Collateral will be held or received by Grantor in trust for
        Secured Parties and immediately delivered in kind to Secured Parties (duly
        endorsed to Secured Parties, if required), to be applied to the Obligations
        or
        held as Collateral, as Secured Parties shall elect. Upon the occurrence and
        during the continuance of an Event of Default, Secured Parties shall have
        the
        right at all times to receive, receipt for, endorse, assign, deposit and
        deliver, in the name of Secured Parties or in the name of Grantor, any and
        all
        checks, notes, drafts and other instruments for the payment of money
        constituting proceeds of or otherwise relating to the Collateral; and Grantor
        hereby authorizes Secured Parties to affix, by facsimile signature or otherwise,
        the general or special endorsement of Grantor, in such manner as Secured
        Parties
        shall deem advisable, to any such instrument in the event the same has been
        delivered to or obtained by Secured Parties without appropriate endorsement,
        and
        Secured Parties and any collecting bank are hereby authorized to consider
        such
        endorsement to be a sufficient, valid and effective endorsement by Grantor,
        to
        the same extent as though it were manually executed by the duly authorized
        representative of Grantor, regardless of by whom or under what circumstances
        or
        by what authority such endorsement actually is affixed, without duty of inquiry
        or responsibility as to such matters, and Grantor hereby expressly waives
        demand, presentment, protest and notice of protest or dishonor and all other
        notices of every kind and nature with respect to any such
        instrument.

       

      6. Events
        of Default.
        Grantor
        shall be in default under this Security Agreement upon the occurrence of
        the
        following (each an “Event of Default”):

       

      6.1 In
        the
        event of any default under a Note; 

       

      6.2 On
        the
        material non-monetary breach by Grantor of any of the provisions of this
        Security Agreement, and with respect to any such breach which by its nature
        can
        be cured, such breach remains uncured for a period of ten (10) days from
        Grantor’s receipt of written notice;

       

      6.3 Any
        of
        the Grantor’s representations or warranties made herein or any statement or
        certificate at any time given in writing pursuant hereto or in connection
        herewith being false or misleading in any material respect; and

       

      6.4 There
        occurs any levy, attachment or seizure for any cause or reason whatsoever,
        upon
        all or any part of the Collateral (unless discharged by payment, release
        or
        fully bonded against not more than thirty (30) days after such event has
        occurred);

       

      
        
          
          

        

        
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      7. Remedies.

       

      7.1 Remedies
        upon an Event of Default.
        Upon
        the occurrence of an Event of Default and at any time thereafter during the
        continuance of an Event of Default, the Secured Parties may exercise any
        one or
        more of the following rights and remedies effective immediately upon written
        notice to Grantor: (i) declare all unmatured Obligations to be immediately
        due and payable, and the same shall thereupon be immediately due and payable,
        without presentment or other notice or demand; (ii) exercise and enforce
        any or all rights and remedies available upon default to a secured party
        under
        the Uniform Commercial Code, including, but not limited to, the right to
        take
        possession of any Collateral, proceeding without judicial process or by judicial
        process (without a prior hearing or notice thereof, which the Grantor hereby
        expressly waives), and the right to sell, lease or otherwise dispose of any
        or
        all of the Collateral, and in connection therewith, the Secured Parties may
        require the Grantor to make the Collateral available to the Secured Parties
        at a
        place to be designated by the Secured Parties which is reasonably convenient
        to
        such parties, and if notice to the Grantor of any intended disposition of
        the
        Collateral or any other intended action is required by law in a particular
        instance, such notice shall be deemed commercially reasonable if given (in
        the
        manner specified in Section 7.2) at least ten (10) days prior to the date
        of intended disposition or other action; and (iii) exercise or enforce any
        or all other rights or remedies available to the Secured Parties by law or
        agreement against the Collateral, against the Grantor or against any other
        person or property. 

       

      7.2 Notice
        of Sale.
        Secured
        Parties shall give Grantor reasonable notice of the time and place of any
        public
        sale thereof or of the time on or after which any private sale thereof is
        to be
        made. The requirement of reasonable notice conclusively shall be met if such
        notice is mailed, certified mail, postage prepaid, to Grantor at its address
        set
        forth on the signature page hereto or delivered or otherwise sent to Grantor,
        at
        least five business days before the date of the sale. Grantor expressly waives,
        to the fullest extent permitted by applicable law, any right to receive notice
        of any public or private sale of any Collateral or other security for the
        Obligations except as expressly provided for in this Section 7.2. Secured
        Parties shall not be obligated to make any sale of the Collateral if it shall
        determine not to do so regardless of the fact that notice of sale of the
        Collateral may have been given. Secured Parties may, without notice or
        publication, except as required by applicable law, adjourn the sale from
        time to
        time by announcement at the time and place fixed for sale, and such sale
        may,
        without further notice (except as required by applicable law), be made at
        the
        time and place to which the same was so adjourned.

       

      7.3 Disposition
        of Proceeds of Sale.
        The
        proceeds resulting from the collection, liquidation, sale or other disposition
        of the Collateral shall be applied, first, to the reasonable costs and expenses
        (including reasonable attorneys’ fees) of retaking, holding, storing, processing
        and preparing for sale, selling, collecting and liquidating the Collateral,
        and
        the like; second, to the satisfaction of all Obligations; and, third, any
        surplus remaining after the satisfaction of all Obligations shall be paid
        over
        to Grantor or to whomsoever may be lawfully entitled to receive such
        surplus.

       

      
        
          
          

        

        
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      8. Miscellaneous.

       

      8.1 Remedies
        Cumulative.
        The
        rights and remedies provided under this Agreement are cumulative and may
        be
        exercised singly or concurrently, and are not exclusive of any other rights
        and
        remedies provided by law or equity.

       

      8.2 Cooperation
        by Grantor.
        If an
        Event of Default shall have occurred and be continuing, Grantor shall take
        any
        action which Secured Parties may request in the exercise of its rights and
        remedies under this Agreement in order to transfer and assign to Secured
        Parties
        or to one or more third parties as Secured Parties may designate, or to a
        combination of the foregoing, the Collateral for the purposes of a public
        or
        private sale. Upon the occurrence and during the continuance of an Event
        of
        Default, Grantor shall further use its best efforts to assist in obtaining
        any
        approval required by any governmental authority for any action or transaction
        contemplated by this Agreement.

       

      8.3 Notice.
        Secured
        Parties shall use reasonable efforts to give Grantor prior written notice
        of the
        exercise of any remedy provided for herein; provided that the failure to
        give
        such notice shall not subject Secured Parties to liability and shall not
        affect
        the validity or exercise of any remedy hereunder. 

       

      8.4 Secured
        Parties Appointed Attorney-in-Fact.
        To the
        full extent permitted by applicable law, Grantor hereby irrevocably appoints
        Secured Parties as Grantor’s attorney-in-fact, effective upon and during
        continuance of an Event of Default, with full authority in the place and
        stead
        of Grantor, and in the name of Grantor, or otherwise, from time to time,
        in
        Secured Parties’ sole and absolute discretion to do any of the following acts or
        things: (a) to do all acts and things and to execute all documents necessary
        or
        advisable to perfect and continue perfected the security interests created
        by
        this Agreement and to preserve, maintain and protect the Collateral; (b)
        to do
        any and every act which Grantor is obligated to do under this Agreement;
        (c) to
        prepare, sign, file and record, in Grantor’s name, any financing statement
        covering the Collateral; and (d) to endorse and transfer the Collateral upon
        foreclosure by Secured Parties; provided, however, that Secured Parties shall
        be
        under no obligation whatsoever to take any of the foregoing actions, and
        Secured
        Parties shall have no liability or responsibility for any act or omission
        (other
        than Secured Parties’ own gross negligence or willful misconduct) taken with
        respect thereto. Grantor hereby agrees to repay within five business days
        after
        demand all reasonable out-of-pocket costs and expenses (including attorneys’
fees) incurred or expended by Secured Parties in exercising any right or
        taking
        any action under this Agreement.

       

      8.5 Costs
        and Expenses.
        After
        the occurrence and during the continuance of an Event of Default, Grantor
        agrees
        to pay to Secured Parties all reasonable costs and out-of-pocket expenses
        (including, without limitation, reasonable attorneys’ fees and disbursements)
        incurred by Secured Parties in the enforcement or attempted enforcement of
        this
        Agreement, whether or not an action is filed in connection therewith, and
        in
        connection with any waiver or amendment of any term or provision hereof.
        All
        reasonable advances, charges, costs and expenses, including reasonable
        attorneys’ fees and disbursements, incurred or paid by Secured Parties in
        exercising any right, privilege, power or remedy conferred by this Agreement
        or
        in the enforcement or attempted enforcement thereof, shall be secured hereby
        and
        shall become a part of the Obligations and shall be due and payable to Secured
        Parties by Grantor on demand therefor.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      8.6 Transfers
        and Other Liens.
        Grantor
        agrees that, except in the ordinary course of business and for fair value,
        it
        will not (a) sell, assign, exchange, transfer or otherwise dispose of, or
        contract to sell, assign, exchange, transfer or otherwise dispose of, or
        grant
        any option with respect to, any of the Collateral, or (b) create or permit
        to
        exist any lien upon or with respect to any of the Collateral, except for
        liens
        in favor of Secured Parties; provided, however, that nothing herein shall
        prohibit Grantor from entering into a purchase money security interest
        transaction with a third party creditor so long as the security interest
        granted
        herein or created hereby is not impaired.

       

      8.7 Other
        Agreements; Governing Agreement.
        Nothing
        herein shall in any way modify or limit the effect of terms or conditions
        set
        forth in any other agreement executed by Grantor or any other person in
        connection with the Obligations, but each and every term and condition hereof
        shall be in addition thereto.

       

      8.8 Counterparts;
        Delivery.
        This
        Agreement may be executed in one or more counterparts, each of which shall
        be
        deemed an original but all of which taken together shall constitute one and
        the
        same instrument. Delivery of this Agreement may be effected by telefax
        transmittal of signed counterparts.

       

      8.9 Understandings
        With Respect to Waivers and Consents.
        Grantor
        warrants and agrees that each of the waivers and consents set forth herein
        are
        made with full knowledge of their significance and consequences, with the
        understanding that events giving rise to any defense or right waived may
        diminish, destroy or otherwise adversely affect rights which Grantor otherwise
        may have against Secured Parties or others, or against any Collateral. If
        any of
        the waivers or consents herein are determined to be unenforceable under
        applicable law, such waivers and consents shall be effective to the maximum
        extent permitted by law.

       

      8.10 Amendments,
        Etc.
        No
        amendment or waiver of any provision of this Agreement nor consent to any
        departure by Grantor herefrom (other than supplements to the Schedules hereto
        in
        accordance with the terms of this Agreement) shall in any event be effective
        unless the same shall be in writing and shall be effective only in the specific
        instance and for the specific purpose for which given.

       

      8.11 Notices.
        Any
        notice, payment, report or any other communication required or permitted
        to be
        given by one party to the other party by this Agreement shall be in writing
        and
        either (a) served personally on the other party, (b) sent by express, registered
        or certified first-class mail, postage prepaid, addressed to the other party
        at
        its principal business address or to such other address as the addressee
        shall
        have theretofore furnished to the other party by proper notice, (c) delivered
        by
        commercial courier to the other party, or (d) sent by telefax to the other
        party
        at its telefax number indicated next to its signature below or to such other
        telefax number as the party shall have theretofore furnished to the other
        party
        by proper notice, with machine confirmation of transmission.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      8.12 Continuing
        Security Interest: Transfer of Note; Termination.
        This
        Agreement shall create a continuing security interest in the Collateral and
        shall (a) remain in full force and effect until indefeasible payment in
        full of the Obligations, (b) be binding upon Grantor, its successors and
        assigns, and (c) inure, together with the rights and remedies of Secured
        Parties hereunder, to the benefit of Secured Parties. Secured Parties may
        assign
        or otherwise transfer any rights in Collateral held by it to any other person,
        and such other person shall thereupon become vested with all the benefits
        in
        respect thereof granted to Secured Parties herein or otherwise. Nothing set
        forth herein is intended or shall be construed to give to any other party
        any
        right, remedy or claim under, to or in respect of this Agreement or any
        Collateral. Grantor’s successors and assigns shall include, without limitation,
        a receiver, trustee or debtor-in-possession thereof or therefor; provided
        that,
        except as otherwise permitted under the Guarantee, or any agreement between
        the
        parties, none of the rights or obligations of Grantor hereunder may be assigned
        or otherwise transferred without the prior written consent of Secured
        Parties.

       

      8.13 Release
        of Grantor.
        This
        Agreement and all obligations of Grantor hereunder and all security interests
        granted hereby shall be released and terminated when all Obligations have
        been
        indefeasibly paid in full in cash or otherwise performed. Upon such release
        and
        termination of all Obligations and the security interest granted hereunder,
        all
        rights in and to the Collateral pledged or assigned by Grantor hereunder
        shall
        automatically revert to Grantor, and Secured Parties shall return any pledged
        Collateral in its possession to Grantor, or to the person or persons legally
        entitled thereto, and shall endorse, execute, deliver, record and file all
        instruments and documents, and do all other acts and things, reasonably required
        for the return of the Collateral to Grantor, or to the person or persons
        legally
        entitled thereto, and to evidence or document the release of the interests
        of
        Secured Parties arising under this Agreement, all as reasonably requested
        by,
        and at the sole expense of, Grantor.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      IN
        WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
        date
        first above written.

       

       

      
        	 	 	 
	 	VENDINGDATA
                CORPORATION 
	 
 	 
 	 
 
	 	By:  	/s/ 
	 	
                
Mark
                R. Newburg,
	 	President
                and Chief Executive Officer


      

      
         

        
          	 	 	 
	 	
                  BRICOLEUR
                    PARTNERS, L.P.

                
	 
 	 
By:  	
                  
 Bricoleur
                    Capital Management, LLC, 

                  Its
                    General Partner

                
	 	By: 	 
	 	
                  
Robert
                  Poole, 
	 	
                  Member
                    of  Management
                    Board

                


        

         

        
          	 	 	 
	 	BRICOLEUR
                  ENHANCED, L.P.
	 
 	
                   

                  By:
                    

                	  
                  
                  Bricoleur
                    Capital Management, LLC,

                  Its
                    General Partner

                
	 	By:  	 
	 	
                  
                    

                  

                  Robert
                    Poole, Member of 

                  Management
                    Board

                
	 


        

      

       

      
        	 	 	 
	 	
                BRIC
                  6, L.P.

              
	 
 	 
By:
                	
                
Bricoleur
                  Capital Management, LLC,

                Its
                  General Partner

              
	 	By:  	 
	 	
                
                  

                

                Robert
                  Poole, Member of

                Management
                  Board

              
	 


      

       

      
        	 	 	 
	 	
                BRICOLEUR
                  OFFSHORE LTD.

              
	 
 	 
By:	 
 Bricoleur
                Capital Management, LLC, 
                Its
                  Investment Adviser

              
	 	By:  	 
	 	
                
                  
Robert
                  Poole, Member of
Management
                  Board

              
	 


      

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      


       

      Exhibit
        A

       

       

      Location
        of Collateral

       

       

      All
        Collateral is located at the Company’s facilities at:

       

      6830
        Spencer Street

      Las
        Vegas, Nevada 89119

       

      and

       

      Xiaolan
        Town

      Zhongshan
        City

      Guangdong
        Province, China

       

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      Exhibit
        B

       

       

      Permitted
        Liens

       

       

      


      
        
          
          

        

        
          14