EXHIBIT
      10.1

     

    CREDIT
      AGREEMENT dated as of October 5, 2005, between VENDING DATA CORPORATION, a
      Nevada corporation (hereinafter called the "Company"), LC Capital Master Fund,
      Ltd., a New York limited liability company ("Lampe"), and Triage Capital
      Management L.P., a Delaware limited partnership ("Triage") Triage Capital
      Management B, L.P., a Delaware limited partnership ("Triage B"), and Triage
      Offshore Fund, Ltd. ("Triage Offshore," and Triage, Triage B, Triage Offshore
      and Lampe being hereinafter collectively called the "Lenders"), and Lampe,
      as
      agent for the Lenders (Lampe in such capacity being hereinafter called the
      "Agent"). 

    


    The
      Company has applied to the Lenders for loans (the "Loans") in the aggregate
      principal amount of $5,000,000 during the period from the date hereof to a
      final
      maturity date of the Loans of October 1, 2006. The proceeds of the Loans are
      to
      be used by the Company for the purpose set forth in Section 1A hereof and for
      working capital purposes. The Lenders are willing to make the Loans to the
      Company, upon the terms and subject to the conditions hereinafter set forth,
      in
      amounts equal, for Lampe, to 50% of the applicable Loan; for Triage, to 17.5%
      of
      the applicable Loan; for Triage B, to 22.5% of the applicable Loan, and for
      Triage Overseas, to 10% of the applicable Loan (each such Lender's "Share").
      Accordingly, the Company, the Lenders and the Agent agree as
      follows:

    


    SECTION
      1. Loans.
      Each
      Lender agrees, upon the terms and subject to the conditions hereinafter set
      forth, to make its Share of the Loans to the Company. Each Loan shall be in
      the
      aggregate principal amount of at least $100,000, which may be increased for
      each
      Loan in increments of at least $25,000, up to a maximum principal amount for
      the
      first Loan of $1,000,000 and for any subsequent Loan of $500,000; provided,
      however, that if on or before November 15, 2005, the Company fails to acquire
      the intellectual property (the "IP Acquisition") described in that certain
      letter from the Company to the Lenders dated the date of this Agreement for
      the
      amount specified therein (the "IP Acquisition Amount") then the maximum amount
      of both the Loans in the aggregate and the applicable Loans to be made on the
      next date for the making of Loans shall be reduced by the IP Acquisition Amount.
      Each Loan shall be made, subject as aforesaid, in two-week intervals, in each
      case on five business days' prior written notice from the Company to the Agent
      that the applicable conditions set forth in Section 5 hereof have been
      satisfied. Each Loan shall be evidenced by a promissory note, substantially
      in
      the form attached hereto as Exhibit A (hereinafter collectively called the
      "Notes"), payable to the order of the applicable Lender, duly executed on behalf
      of the Company, dated the date of issuance and in the principal amount of such
      Lender's Share of such Loan. The principal amount of the Notes shall be due
      and
      payable on October 1, 2006, subject to mandatory prepayment as provided in
      Sections 1A(c) and 2(b) hereof. Each Note shall bear interest from its date
      (computed on the basis of the actual number of days elapsed over a year of
      365/366 days) at a rate equal to nine percent (9%) per annum. Interest on each
      Note shall be due and payable monthly in arrears on the first day of each month,
      commencing on the first of such dates following the date of the issuance of
      the
      applicable Note.

     

    SECTION
      1A. Cure
      of Default Under February/March Notes; Related Condition of Lending and
      Mandatory Prepayment.
      The
      Company acknowledges that it is currently in default in the payment of interest
      in the amount of $600,000 (the "Interest Amount") on the Company's 10% secured
      convertible notes due February and March 2008 (the "February/March Notes").
      The
      Company agrees that (a) the first $600,000 of the initial Loans hereunder will
      be applied directly to the payment in full of the Interest Amount; (b) as a
      condition to the obligation of the Lenders to make any Loans hereunder in
      addition to the initial Loans, within two weeks after the date of the initial
      Loans hereunder the Company will obtain the consent of a majority in principal
      amount of the holders of the February/March Notes not affiliated with either
      Lender to the execution and delivery of this Agreement and the Amendment to
      Security Agreement in the form of Exhibit C attached and the consummation of
      all
      transactions provided for herein and therein; and (c) if the condition set
      forth
      in Section 1A (b) is not fulfilled, the Lenders may by written notice to the
      Company terminate their obligation to make further Loans hereunder and demand
      payment in full of the entire principal amount of all Notes then outstanding
      and
      all accrued and unpaid interest thereon and all other amounts then owed the
      Lenders, whereupon all such amounts shall become so due and
      payable.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    SECTION
      2. Prepayments.

     

    (a) Optional
      Prepayment of Notes.
      Upon at
      least three business days=
      prior
      written or telegraphic notice to the Lenders, the Company may at its option
      prepay the Notes in whole at any time or in part from time to time without
      penalty or premium. Each optional prepayment of the Notes shall be applied
      to
      the outstanding Notes in the inverse order of maturity, pro rata
      in
      accordance with each Lender's Share. Each partial prepayment pursuant to this
      Section 2(a) on the Notes shall be in the aggregate principal amount of $10,000
      or an integral multiple thereof and shall be accompanied by the payment of
      accrued interest on the amount of such prepayment to the date
      thereof.

     

    (b) Mandatory
      Prepayment of Notes.
      The
      Notes shall be subject to mandatory prepayment as follows:

     

    (X)
      If
      the Company or any subsidiary thereof shall (i) issue any capital stock or
      other
      equity securities of the Company or any such subsidiary or any equivalents
      (however designated) of equity securities of the Company or any subsidiary
      thereof (including, without limitation, any equity securities issued upon the
      exercise of any warrants or options or other rights to purchase equity
      securities of the Company or any such subsidiary); or (ii) sell, lease, license,
      or otherwise transfer for value any of its assets (including, without
      limitation, any intellectual property), the Company shall immediately apply
      the
      net cash proceeds thereof (x) to the payment of all accrued and unpaid interest
      on the Notes and any other amounts then owed the Lenders and then (y) to the
      payment of the principal amount of the Notes then outstanding, in the inverse
      order of maturity.

     

    (Y)
      If
      the Lenders deem themselves, in their sole discretion, to be insecure, the
      Lenders may, by notice given on November 15, 2005, terminate their obligation
      to
      make further Loans hereunder and demand payment in full of the entire principal
      amount of all Notes then outstanding and all accrued and unpaid interest thereon
      and all other amounts then owed the Lenders on or before March 15, 2006,
      whereupon all such amounts shall become so due and payable.

     

    (c) No
      Reborrowing.
      The
      Company may not reborrow any amount prepaid under this Section 2, and the
      obligation of the Lenders to make Loans hereunder in respect of any such
      prepayment shall be terminated.

     

    
      
         

      

      
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    SECTION
      3. Cash
      Flow Forecast.

     

    Attached
      hereto as Exhibit B is a Cash Flow Forecast for the Company for the 13-week
      period commencing September 30, 2005, and ending December 30, 2005 (the "Initial
      Forecast"). At the initial Closing, the Company will provide to the Agent and
      the Lenders, as condition to closing, an updated forecast in the form of the
      Initial Forecast (the "Closing Forecast"). At the end of the first calendar
      two
      weeks following the initial Closing and for each calendar two-week period
      thereafter until payment in full of the Notes and all other liabilities and
      obligations of the Company to the Lenders and the Agent, the Company will
      provide to the Agent and the Lenders (a) an updated forecast in the form of
      the
      Closing Forecast for the ensuing 13-week period (the "Current Forecast") and
      (b)
      a statement of actual cash flow for the preceding two-week period using the
      format of the Current Forecast (the "Current Cash Flow Report"). If for any
      period of either (x) three consecutive two-week periods or (y) three two-week
      periods of any consecutive four two-week periods the actual cash flow shown
      on
      the applicable Current Cash Flow Reports is less than 90% of forecast cash
      flow
      for the applicable Current Forecasts, (a "Cash Flow Shortfall") then the
      Lenders, in their discretion, may (i) refuse to make further Loans to the
      Company and/or (ii) declare an Event of Default pursuant to Section 8 (e) of
      this Agreement. 

    


    SECTION
      4. Representations
      and Warranties of the Company.

     

    The
      Company represents and warrants to the Agent and the Lenders as
      follows:

     

    4.1. Organization
      and Qualification.
      The
      Company and each of its subsidiaries is a corporation duly organized and
      existing in good standing under the laws of the jurisdiction in which it is
      incorporated, and has the requisite corporate power to own its properties and
      to
      carry on its business as now being conducted. The Company and each of its
      subsidiaries is duly qualified as a foreign corporation to do business and
      is in
      good standing in every jurisdiction in which the nature of the business
      conducted by it makes such qualification necessary and where the failure so
      to
      qualify would have a Material Adverse Effect. "Material Adverse Effect" means
      any material adverse effect on (i) the Notes, (ii) the ability of the Company
      to
      perform its obligations hereunder or under the Loan Documents, or (iii) the
      business, operations, properties, prospects or financial condition of the
      Company and its subsidiaries, taken as a whole.

     

    4.2.
      Authorization;
      Enforcement.
      (i) The
      Company has the requisite corporate power and authority to enter into and
      perform its obligations under the Loan Documents, to issue the Notes in
      accordance with the terms hereof, and to issue the Warrants and the Warrant
      Shares upon exercise of the Warrants in accordance with the terms of the
      Warrants, (ii) the execution, delivery and performance of the Loan Documents
      by
      the Company and the consummation by it of the transactions contemplated hereby
      and thereby (including, without limitation, the issuance of the Notes and the
      issuance of the Warrant Shares) have been duly authorized by the Company's
      Board
      of Directors and no further consent or authorization of the Company, its Board
      of Directors, any or any committee of the Board of Directors is required, and
      (iii) the Loan Documents, upon execution and delivery, will constitute valid
      and
      binding obligations of the Company enforceable against the Company in accordance
      with their terms.

     

    4.3.
      Stockholder
      Authorization.
      Neither
      the execution, delivery or performance by the Company of the Loan Documents
      nor
      the consummation by it of the transactions contemplated hereby or thereby
      requires any consent or authorization of the Company's stockholders, including
      but not limited to consent under Section 705 of the Amex Company Guide or any
      similar rule.

     

    
      
         

      

      
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    4.4.
      Capitalization.
      The
      capitalization of the Company as of the date hereof, including the authorized
      capital stock, the number of shares issued and outstanding, the number of shares
      issuable and reserved for issuance pursuant to the Company's stock option plans,
      the number of shares issuable and reserved for issuance pursuant to securities
      (other than the Warrants) exercisable or exchangeable for, or convertible into,
      any shares of capital stock is set forth on Schedule
      X.
      All of
      such outstanding shares of capital stock have been, or upon issuance in
      accordance with the terms of any such warrants, options, preferred stock or
      other securities will be, validly issued, fully paid and non-assessable. No
      shares of capital stock of the Company (including the Warrant Shares) are
      subject to preemptive rights or any other similar rights of the stockholders
      of
      the Company or any liens or encumbrances. Except for the Warrants and as set
      forth on Schedule
      X,
      as of
      the date of this Agreement, (i) there are no outstanding options, warrants,
      scrip, rights to subscribe to, calls or commitments of any character whatsoever
      relating to, or securities or rights convertible into or exercisable or
      exchangeable for, any shares of capital stock of the Company or any of its
      subsidiaries, or arrangements by which the Company or any of its subsidiaries
      is
      or may become bound to issue additional shares of capital stock of the Company
      or any of its subsidiaries, nor are any such issuances or arrangements
      contemplated, and (ii) there are no agreements or arrangements under which
      the
      Company or any of its subsidiaries is obligated to register the sale of any
      of
      its or their securities under the Securities Act (except the Convertible Notes
      of the Company issued in February and March 2005 and the Warrant Shares (as
      defined in the Warrants). Schedule
      X
      sets
      forth all of the Company-issued securities or instruments containing
      antidilution or similar provisions that will be triggered by, and all of the
      resulting adjustments that will be made to such securities and instruments
      as a
      result of, the issuance or exercise of the Warrants in accordance with the
      terms
      of this Agreement. The Company has furnished to the Agent and the Lenders true
      and correct copies of the Company's Articles of Incorporation as in effect
      on
      the date hereof ("Articles of Incorporation"), the Company's By-laws as in
      effect on the date hereof (the "By-laws"), and all other instruments and
      agreements governing securities convertible into or exercisable or exchangeable
      for capital stock of the Company.

     

    4.5.
      Issuance
      of Notes, etc.
      The
      Notes, upon issuance in accordance with the terms of this Agreement, will be
      validly issued and free from all taxes, liens, claims and encumbrances and
      will
      not be subject to preemptive rights, rights of first refusal or other similar
      rights of stockholders of the Company and will not impose personal liability
      on
      the holders thereof. The Warrant Shares are duly authorized and, as applicable,
      reserved for issuance, and, upon issuance pursuant to the exercise of the
      Warrants in accordance with the terms thereof, will be validly issued, fully
      paid and non-assessable, and free from all taxes, liens, claims and encumbrances
      and will not be subject to preemptive rights, rights of first refusal or other
      similar rights of stockholders of the Company and will not impose personal
      liability upon the holder thereof. Upon the amendment and restatement of the
      Company's Articles of Incorporation, the Company will upon reserve for issuance
      pursuant to the Warrants an aggregate number of shares of Common Stock,
      representing the maximum number of Warrant Shares initially issuable upon the
      exercise in full of the Warrants (the "Reserved Amount").

     

    4.6.
      No
      Conflicts.
      Unless
      otherwise noted in this Agreement, the execution, delivery and performance
      of
      the Loan Documents by the Company, and the consummation by the Company of the
      transactions contemplated hereby and thereby will not (i) result in a violation
      of the Articles of Incorporation or By-laws or (ii) conflict with, or constitute
      a default (or an event that with notice or lapse of time or both would become
      a
      default) under, or give to others any rights of termination, amendment
      (including, without limitation, the triggering of any anti-dilution provisions),
      acceleration or cancellation of, any agreement, indenture or instrument to
      which
      the Company or any of its subsidiaries is a party, or result in a violation
      of
      any law, rule, regulation, order, judgment or decree (including United States
      federal and state securities laws and regulations and rules or regulations
      of
      any self-regulatory organizations to which either the Company or its securities
      are subject and gaming laws and regulations) applicable to the Company or any
      of
      its subsidiaries or by which any property or asset of the Company or any of
      its
      subsidiaries is bound or affected (except for such conflicts, defaults,
      terminations, amendments, accelerations, cancellations and violations that
      would
      not, individually or in the aggregate, have a Material Adverse Effect). Neither
      the Company nor any of its subsidiaries is in violation of its Articles of
      Incorporation, By-laws or other organizational documents and neither the Company
      nor any of its subsidiaries is in default (and no event has
      occurred which, with notice or lapse of time or both, would put the Company
      or
      any of its subsidiaries in default) under, nor has there occurred any event
      giving others (with notice or lapse of time or both) any rights of termination,
      amendment, acceleration or cancellation of, any agreement, indenture or
      instrument to which the Company or any of its subsidiaries is a party, except
      for actual or possible violations, defaults or rights that would not,
      individually or in the aggregate, have a Material Adverse Effect. The businesses
      of the Company and its subsidiaries are not being conducted, and shall not
      be
      conducted so long
      as a
      Lender holds any Notes, in violation of any law, ordinance or regulation of
      any
      governmental entity, except for possible violations the sanctions for which
      either singly or in the aggregate would not have a Material Adverse Effect.
      Except as specifically contemplated by the Loan Documents, the Company is not
      required to obtain any consent, approval, authorization or order of, or make
      any
      filing or registration with, any court or governmental agency or any regulatory
      or self regulatory agency in order for it to execute, deliver or perform any
      of
      its obligations under the Loan Documents, in each case in accordance with the
      terms hereof or thereof. The Company is not in violation of the listing
      requirements of the American Stock Exchange ("Market/Exchange") and does not
      reasonably anticipate that the Common Stock will be delisted by the
      Market/Exchange for the foreseeable future.

     

    
      
         

      

      
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    4.7.
      SEC
      Documents, Financial Statements.
      Since
      December 31, 2004, the Company has timely filed (within applicable extension
      periods) all reports, schedules, forms, statements and other documents required
      to be filed by it with the SEC pursuant to the reporting requirements of the
      Exchange Act all of which are listed in Schedule
      Y
      hereof
      (all of the foregoing filed prior to the date hereof and all exhibits included
      therein and financial statements and schedules thereto and documents
      incorporated by reference therein, being hereinafter referred to herein as
      the
      "SEC Documents"). The Company has delivered
      to each Lender true and complete copies of the SEC Documents. As of their
      respective dates, the SEC Documents complied in all material respects with
      the
      requirements of the Exchange Act or the Securities Act, as the case may be,
      and
      the rules and regulations of the SEC promulgated thereunder applicable to the
      SEC Documents, and none of the SEC Documents, at the time they were filed with
      the SEC, contained any untrue statement of a material fact or omitted to state
      a
      material fact required to be stated
      therein or necessary in order to make the statements therein, in light of the
      circumstances under which they were made, not misleading. None of the statements
      made in any such SEC Documents is, or has been, required to be amended or
      updated under applicable law (except for such statements as have been amended
      or
      updated in subsequent filings made prior to the date hereof). As of their
      respective dates, the financial statements of the Company included in the SEC
      Documents complied as to form in all material
      respects with applicable accounting requirements and the published rules and
      regulations of the SEC applicable with respect thereto. Such financial
      statements have been prepared in accordance with U.S. generally accepted
      accounting principles ("GAAP"), consistently applied, during the periods
      involved (except (i) as may be otherwise indicated in such financial statements
      or the notes thereto, or (ii) in the case of unaudited interim statements,
      to
      the extent they may not include footnotes or may be condensed or summary
      statements) and fairly present in all material respects the consolidated
      financial position of the Company and its consolidated subsidiaries as of the
      dates thereof and the consolidated results of their operations and cash flows
      for the periods then ended (subject, in the case of unaudited statements, to
      immaterial year-end audit adjustments). Except as set forth in the financial
      statements of the Company included in the SEC Documents filed prior to the
      date
      hereof, the Company has no liabilities, contingent or otherwise, other than
      (i)
      liabilities incurred in the ordinary course of business subsequent to the date
      of such financial statements and (ii) obligations under contracts and
      commitments incurred in the ordinary course of business and not required under
      GAAP to be reflected in such financial statements,
      which liabilities and obligations referred to in clauses (i) and (ii),
      individually or in the aggregate, are not material to the financial condition
      or
      operating results of the Company.

     

    4.8.
      Absence
      of Certain Changes.
      Since
      December 31, 2004, there has been no material adverse change and no material
      adverse development in the business, properties, operations, prospects,
      financial condition or results of operations of the Company and its
      subsidiaries, taken as a whole, except as disclosed in the SEC Documents filed
      prior to the date hereof.

     

    4.9.
      Absence
      of Litigation.
      Except
      as disclosed in the SEC Documents filed prior to the date hereof, there is
      no
      action, suit, proceeding, inquiry or investigation before or by any court,
      public board, government agency, self-regulatory organization or body,
      including, without limitation, the SEC or the Market Exchange, pending or,
      to
      the knowledge of the Company or any of its subsidiaries, threatened against
      or
      affecting the Company, any of its subsidiaries, or any of their respective
      directors or officers in their capacities as such. There are no facts which,
      if
      known by a potential claimant or governmental authority, could rise to a claim
      or proceeding which, if asserted or conducted with results unfavorable to the
      Company or any of its subsidiaries, could reasonably be expected to have a
      Material Adverse Effect.

     

    4.10.
      Intellectual
      Property.
      Each of
      the Company and its subsidiaries owns or is licensed to use all patents, patent
      applications, trademarks, trademark applications, trade names, service marks,
      copyrights, copyright applications, licenses, permits, inventions, discoveries,
      processes, scientific, technical, engineering and marketing data, object and
      source codes, know-how (including trade secrets and other unpatented and/or
      unpatentable proprietary or confidential information, systems or procedures)
      and
      other similar rights and proprietary knowledge (collectively, "Intangibles")
      necessary for the conduct of its business as now being conducted. To the best
      knowledge of the Company, neither the Company nor any subsidiary of the Company
      infringes or is in conflict with any right of any other person with respect
      to
      any Intangibles. Except as disclosed in the SEC Documents filed prior to the
      date hereof, neither the Company nor any of its subsidiaries has received
      written notice of any pending conflict with or infringement upon such third
      party Intangibles. Neither the Company nor any of its subsidiaries has entered
      into any consent agreement, indemnification agreement, forbearance to sue or
      settlement agreement with respect to the validity of the Company's or its
      subsidiaries' ownership or right to use its Intangibles and, to the best
      knowledge of the Company, there is no reasonable basis for any such claim to
      be
      successful. The Intangibles are valid and enforceable and no registration
      relating thereto has lapsed, expired or been abandoned or canceled or is the
      subject of cancellation or other adversarial proceedings, and all applications
      therefor are pending and in good standing.
      The Company and its subsidiaries have complied, in all material respects, with
      their respective contractual obligations relating to the protection of the
      Intangibles used pursuant to licenses. To the best knowledge of the Company,
      no
      person is infringing on or violating the Intangibles owned or used by the
      Company or its subsidiaries.

     

    
      
         

      

      
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    4.11.
      Foreign
      Corrupt Practices.
      Neither
      the Company, nor any of its subsidiaries, nor any director, officer, agent,
      employee or other person acting on behalf of the Company or any subsidiary
      has,
      in the course of his actions for, or on behalf of, the Company, used any
      corporate funds for any unlawful contribution, gift, entertainment or other
      unlawful expenses relating to political activity; made any direct or indirect
      unlawful payment to any foreign or domestic government official or employee
      from
      corporate funds; violated or is in violation of any provision of the U.S.
      Foreign Corrupt Practices Act of 1977; or made any bribe, rebate, payoff,
      influence payment, kickback or other unlawful payment to any foreign or domestic
      government official or employee.

     

    4.12.
      Disclosure.
      All
      information relating to or concerning the Company set forth in this Agreement
      or
      provided to the Agent or the Lenders in connection with the transactions
      contemplated hereby is true and correct in all material respects and the Company
      has not omitted to state any material fact necessary in order to make the
      statements made herein or therein, in light of the circumstances under which
      they were made, not misleading. No event or circumstance has occurred or exists
      with respect to the Company or its subsidiaries or their respective businesses,
      properties, prospects, operations or financial conditions, which has not been
      publicly disclosed but, under applicable law, rule or regulation, would be
      required to be disclosed by the Company in a registration statement filed on
      the
      date hereof by the Company under the Securities Act with respect to the primary
      issuance of the Company's securities.

     

    4.13.
      Acknowledgment
      Regarding Lenders' Acquisition of the Notes.
      The
      Company acknowledges and agrees that none of the Agent or the Lenders is acting
      as a financial advisor or fiduciary of the Company (or in any similar capacity)
      with respect to this Agreement or the transactions contemplated hereby, the
      relationship between the Company and the Agent and the Lenders is "arms-length"
      and any statement made by any either Lender or any of its representatives or
      agents in connection with this Agreement and the transactions contemplated
      hereby is merely incidental to such Lender's making the Loans or acquiring
      of
      the Notes and has not been relied upon by the Company, its officers or directors
      in any way. The Company further acknowledges that the Company's decision to
      enter into this Agreement has been based solely on an independent evaluation
      by
      the Company and its representatives.

     

    4.13A.
      Form
      S-3 Eligibility.
      The
      Company is currently eligible to register the resale of its Common Stock on
      a
      registration statement on Form S-3 under the Securities Act. There exist no
      facts or circumstances that would prohibit or delay the preparation and filing
      of a registration statement on Form S-3 with respect to the Warrant Shares.
      The
      Company has no basis to believe that its past or present independent public
      auditors will withhold their consent to the inclusion, or incorporation by
      reference, of their audit opinion concerning the Company's financial statements
      which are included in the registration statement required to be filed pursuant
      to the Warrants.

     

    
      
         

      

      
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    4.14.
      Title.
      Except
      for the first priority security interest granted to [Premier
      Trust,
      Inc.],
      the Company and its subsidiaries have good and marketable title in fee simple
      to
      all real property and good and merchantable title to all personal property
      owned
      by them that is material to the business of the Company and its subsidiaries,
      in
      each case free and clear of all liens, encumbrances and defects except such
      as
      do not materially affect the value of such property and do not materially
      interfere with the use made and proposed to be made of such property by the
      Company and its subsidiaries. Any real property and facilities held under lease
      by the Company and its subsidiaries are held by them under valid, subsisting
      and
      enforceable leases with such exceptions as are not material and do not
      materially interfere with the use made and proposed to be made of such property
      and buildings by the Company and its subsidiaries.

     

    4.15.
      Tax
      Status.
      Except
      as set forth in the SEC Documents, the Company and each of its subsidiaries
      has
      made or filed all foreign, U.S. federal, state and local income and all other
      tax returns, reports and declarations required by any jurisdiction to which
      it
      is subject (unless and only to the extent that the Company and each of its
      subsidiaries has set aside on its books provisions reasonably adequate for
      the
      payment of all unpaid and unreported taxes) and has paid all taxes and other
      governmental assessments and charges that are material in amount, shown or
      determined to be due on such returns, reports
      and declarations, except those being contested in good faith and has set aside
      on its books provisions reasonably adequate for the payment of all taxes for
      periods subsequent to the periods to which such returns, reports or declarations
      apply. There are no unpaid taxes in any material amount claimed to be due by
      the
      taxing authority of any jurisdiction, and the officers of the Company know
      of no
      basis for any such claim. The Company has not executed a waiver with respect
      to
      any statute of limitations relating to the assessment or collection of any
      federal, state or local tax. None of the Company's tax returns
      is presently being audited by any taxing authority.

     

    4.16.
       Insurance.
      The
      Company has in force fire, casualty, product liability and other insurance
      policies, with extended coverage, sufficient in amount to allow it to replace
      any of its material properties or assets which might be damaged or destroyed
      or
      sufficient to cover liabilities to which the Company may reasonably become
      subject, and such types and amounts of other insurance with respect to its
      business and properties, on both a per occurrence and an aggregate basis, as
      are
      customarily carried by persons engaged in the same or similar business as the
      Company. No default or event has occurred that could
      give rise to a default under any such policy.

     

    4.17.
      Environmental
      Matters.
      There
      is no environmental litigation or other environmental proceeding pending or
      threatened by any governmental regulatory authority or others with respect
      to
      the current or any former business of the Company or any partnership or joint
      venture currently or at any time affiliated with the Company. No state of facts
      exists as to environmental matters or Hazardous Substances (as defined below)
      that involves the reasonable likelihood of a material capital expenditure by
      the
      Company or that may otherwise have a Material Adverse Effect. No Hazardous
      Substances have been treated,
      stored or disposed of, or otherwise deposited, in or on the properties owned
      or
      leased by the Company or by any partnership or joint venture currently or at
      any
      time affiliated with the Company in violation of any applicable environmental
      laws. The environmental compliance programs of the Company comply in all
      respects with all environmental laws, whether federal, state or local, currently
      in effect. As used herein, "Hazardous Substances" means any substance, waste,
      contaminant, pollutant or material that has been determined by any governmental
      authority to be capable of posing a risk of injury to health, safety, property
      or the environment.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    4.18.
      Inventory.
      All
      inventory of the Company and its subsidiaries is valued on the Company's
      consolidated books and records at the lower of cost, determined by the "first
      in, first out" method of accounting, or the fair market value thereof. Except,
      to the extent of the Company's actual and potential reserves for obsolete or
      unmerchantable inventory reflected and discussed in the Company's SEC Documents,
      all such inventory, after consideration of reserves consisting of finished
      goods
      is of merchantable quality and is saleable in the ordinary course of business
      consistent with past practice.

     

    4.19.
      Sarbanes-Oxley
      Act.
      The
      Company is in compliance with the applicable provisions of the Sarbanes-Oxley
      Act of 2002 (the "Sarbanes-Oxley Act" ), and the rules and regulations
      promulgated thereunder, that are effective as of the date hereof, and intends
      to
      comply with other applicable provisions of the Sarbanes-Oxley Act, and the
      rules
      and regulations promulgated thereunder, upon the effectiveness of such
      provisions.

     

    4.20.
      Indebtedness.
      Schedule
      XX
      hereto
      sets forth as of a recent date all outstanding secured and unsecured
      Indebtedness of the Company or any subsidiary, or for which the Company or
      any
      subsidiary has commitments. For purposes of this Agreement, "Indebtedness"
      shall
      mean (a) any liabilities for borrowed money or amounts owed in excess of
      $100,000 (other than trade accounts payable incurred in the ordinary course
      of
      business), (b) all guaranties, endorsements and other contingent obligations
      in
      respect of Indebtedness of others, whether or not the same are or should be
      reflected in the Company's balance sheet (or the notes thereto), except
      guaranties by endorsement of negotiable instruments for deposit or collection
      or
      similar transactions in the ordinary course of business and (c) the present
      value of any lease payments in excess of $25,000 due under leases required
      to be
      capitalized in accordance with GAAP. Neither the Company nor any subsidiary
      is
      in default with respect to any Indebtedness.

    


    SECTION
      5.  Conditions
      of Lending.

     

    (1)
      The
      obligation of the Lenders to make the first Loan hereunder to the Company is
      subject to the following conditions precedent:

     

    (a) No
      Event
      of Default shall have occurred and be continuing or shall result from the making
      of the first Loan.

     

    (b) The
      Lenders shall have received certified copies of all documents evidencing
      corporate action taken by the Company relative to the completion and carrying
      out of this Credit Agreement, all in form and substance satisfactory to the
      Lenders and their counsel.

     

    (c) The
      representations and warranties contained in Section 4 hereof shall, except
      as
      affected by transactions expressly contemplated hereby, be true and accurate
      on
      and as of the date of the first Loan as though made on and as of such
      date.

     

    (d) The
      Lenders shall have received a certificate or certificates of one or more of
      the
      principal officers of the Company dated the date of the first Loan to the effect
      specified in paragraph (a) and in paragraph (c) of this Section 5.

     

    (e) The
      Lenders shall have received the Closing Forecast.

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    (f) The
      Company shall have executed and delivered to the Agent for the benefit of the
      Lenders an Amendment to Security Agreement (such Security Agreement, together
      with this Agreement and the Notes, being herein sometimes collectively called
      the "Loan Documents") in the form of Exhibit C attached creating the lien on
      the
      assets of the Company as described therein, and the security interest created
      thereby shall have been perfected.

     

    (g) The
      Company shall have issued the Warrants to the Lenders.

     

    (h) The
      Lenders shall have received the favorable written opinion of Preston, Gates
      & Ellis, counsel to the Company, dated on the date of the first Loan,
      satisfactory in form and substance to the Lenders and their counsel, covering
      such matters as the Lenders and their counsel shall request.

     

    (i) All
      legal
      matters incidental to the transactions contemplated hereby shall be satisfactory
      to counsel for the Lenders.

     

    (2) The
      obligation of the Lender to make additional Loans shall be subject (a) to the
      satisfaction of the conditions precedent set forth in Section 5 (1)(a), (c),
      (d)
      and (i) as of the date of each such Loan and (b) to the compliance by the
      Company with all requirements of Section 1A hereof and of Section 3 hereof
      with
      respect to all Current Forecasts and related minimum cash flow requirements.
      

     

    SECTION
      6. Covenants.

     

    From
      and
      after the date of execution hereof and so long as any of the Notes shall be
      outstanding, unless the Lenders shall otherwise consent in writing, the Company
      will observe and perform for the benefit of the Lenders each of the terms,
      covenants and conditions contained in Sections 7.5, 7.7, 7.9, 7.10 and 7.11
      of
      the form of Subscription Agreement with respect to the Company's March 2005
      Note
      Issue, on its part to be observed and performed. All such terms, covenants
      and
      conditions are incorporated by reference herein in haec verba,
      except
      (a) the term "Purchaser" whenever used therein shall be deemed to refer to
      the
      Lenders; and (b) the term "Notes" whenever appearing therein shall be deemed
      to
      refer to the Notes hereunder. In addition to the foregoing, the Company will
      (a)
      keep and observe all provisions of Section 3 hereof and (b) use its best efforts
      in good faith to obtain amendments to the February/March Notes1 
      to
      enable the Lenders to obtain a first lien on the Company's accounts receivable,
      domestic inventory and intellectual property assets.

     

    SECTION
      7. The
      Warrants.

     

    At
      delivery of the first Note, the Company shall issue to each Lender detachable
      warrants in the forms attached hereto as Exhibits D-1 and D-2, exercisable
      as
      set forth therein, to purchase, in the case of each Warrant, such Lender's
      Share
      of a total of 3,000,000 shares of Common Stock of the Company at an exercise
      price of $1.25 per share (the "Warrant Shares). If, on the date which is four
      months from the date of the initial Closing, the Lenders are no longer obligated
      to make Loans or are in breach of their obligations hereunder (unless the
      Company has borrowed the maximum amount of Loans hereunder), the number of
      Warrant Shares shall be reduced from 3,000,000 in the aggregate for all Warrants
      to 1,500,000 in the aggregate for all Warrants. If no reduction occurs pursuant
      to the immediately preceding sentence and, on the date which is eight months
      from the date of the initial Closing, the Lenders are no longer obligated to
      make Loans or are in breach of their obligations hereunder (unless the Company
      has borrowed the maximum amount of Loans hereunder), the number of Warrant
      Shares shall be reduced from 3,000,000 in the aggregate for all Warrants to
      2,250,000 in the aggregate for all Warrants.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

    


    SECTION
      8. Events
      of Default.

     

    The
      occurrence of any of the following events shall constitute an event of default
      hereunder (an AEvent
      of
      Default@):

     

    (a) The
      Company fails to pay any principal, interest or any other payment required
      under
      the Notes when due and payable and whether upon stated maturity or
      otherwise;

     

    (b) The
      Company fails to comply with any other covenant herein contained and does not
      cure such failure within five (5) days after written notice thereof by the
      Agent
      or either Lender to the Company;

     

    (c) Any
      representation or warranty made by the Company proves to have been untrue in
      any
      material respect when made;

     

    (d) The
      Company commences a voluntary case or proceeding as debtor under the Bankruptcy
      Code, or a voluntary petition or an answer seeking readjustment of its debts
      or
      for any other relief under any bankruptcy, insolvency, or other similar act
      or
      law of any jurisdiction, now or hereafter existing, or takes any action
      indicating its consent to, approval of, or acquiescence in, any such petition
      or
      proceeding; the Company applies for, or consents to or acquiesces in the
      appointment of, a receiver or trustee for it or for all or a substantial part
      of
      its property; the Company makes an assignment for the benefit of creditors;
      or
      the Company admits in writing its inability to pay its debts as they
      mature;

     

    (e) A
      Cash
      Flow Shortfall (as defined in Section 3 above) shall have occurred;

     

    (f) An
      event
      shall have occurred and be unremedied which, in the discretionary judgment
      of
      the Lenders, has a Material Adverse Effect; or 

     

    (g) An
      event
      of default, or event which, with notice or lapse of time or both, would become
      an event of default, under any other agreement or instrument in respect of
      any
      indebtedness or equivalent obligation of the Company shall occur and not be
      remedied in accordance with such agreement or instrument.

    
 

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

        
        

      

    


    Upon
      the
      occurrence of an Event of Default, the Agent or either Lender may, in addition
      to any rights and remedies (including the rights and remedies contained in
      the
      Security Agreement) otherwise available to the Lenders, by notice of default
      given to the Company, declare the then outstanding principal balance of and
      accrued interest on the Notes to be forthwith due and payable, whereupon the
      unpaid principal amount, together with accrued interest thereon, shall become
      immediately due and payable without presentment, demand, protest or other notice
      of any kind, all of which are hereby expressly waived, notwithstanding anything
      contained to the contrary therein.

     

    SECTION
      9. The
      Agent.

     

    Each
      Lender hereby appoints and authorizes the Agent to take such action as agent
      on
      its behalf and to exercise such powers and discretion under this Agreement
      as
      are delegated to the Agent by the terms hereof, together with such powers and
      discretion as are reasonably incidental thereto. As to any matters not expressly
      provided for by this Agreement (including, without limitation, enforcement
      or
      collection of the Notes), the Agent shall not be required to exercise any
      discretion or take any action, but shall be required to act or to refrain from
      acting (and shall be fully protected in so acting or refraining from acting)
      upon the instructions of the Lenders, and such instructions shall be binding
      upon all Lenders and all holders of Notes; provided,
      however,
      that
      the Agent shall not be required to take any action which exposes the Agent
      to
      personal liability or which is contrary to this Agreement or applicable
      law.

     

    SECTION
      9.1. Agent's
      Reliance, Etc.

     

    Neither
      the Agent nor any of its directors, officers, agents or employees shall be
      liable for any action taken or omitted to be taken by it or them under or in
      connection with this Agreement, except for its or their own gross negligence
      or
      willful misconduct. Without limitation of the generality of the foregoing,
      the
      Agent: (i) may treat the payee of any Note as the holder thereof until the
      Agent
      receives written notice of the assignment or transfer thereof signed by such
      payee and in form satisfactory to the Agent; (ii) may consult with legal counsel
      (including counsel for the Company), independent public accountants and other
      experts selected by it and shall not be liable for any action taken or omitted
      to be taken in good faith by it in accordance with the advice of such counsel,
      accountants or experts; (iii) makes no warranty or representation to any Lender
      and shall not be responsible to any Lender for any statements, warranties or
      representations made in or in connection with this Agreement; (iv) shall not
      have any duty to ascertain or to inquire as to the performance or observance
      of
      any of the terms, covenants or conditions of this Agreement on the part of
      the
      Company or to inspect the property (including the books and records) of the
      Company; (v) shall not be responsible to any Lenders for the due execution,
      legality, validity, enforceability, genuineness, sufficiency or value of this
      Agreement or any other instrument or document furnished pursuant hereto; and
      (vi) shall incur no liability under or in respect of this Agreement by acting
      upon any notice, consent, certificate or other instrument or writing (which
      may
      be by telecopy, telegram, cable or telex) believed by it to be genuine and
      signed or sent by the proper party or parties.

     

    SECTION
      9.2. Lampe
      and Affiliates.

     

    With
      respect to the Loans made by it and the Notes issued to it, Lampe shall have
      the
      same rights and powers under this Agreement as any other Lender and may exercise
      the same as though it were not the Agent; and the term "Lender" or "Lenders"
      shall, unless otherwise expressly indicated include Lampe in its individual
      capacity. Lampe and its affiliates may generally engage in any kind of business
      with the Company, any of its subsidiaries and any person who may do business
      with or own securities of the Company or any such subsidiary, all as if Lampe
      were not the Agent and without any duty to account therefor to the
      Lenders.

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

     

    SECTION
      9.3. Lender
      Credit Decision.

     

    Each
      Lender acknowledges that it has, independently and without reliance upon the
      Agent or any other Lender and based on the SEC Documents and financial
      statements referred to in Section 4.7 and such other documents and information
      as it has deemed appropriate, made its own credit analysis and decision to
      enter
      into this Agreement. Each Lender also acknowledges that it will, independently
      and without reliance upon the Agent or any other Lender and based on such
      documents and information as it shall deem appropriate at the time, continue
      to
      make its own credit decisions in taking or not taking action under this
      Agreement.

     

    SECTION
      9.4. Indemnification.

     

    The
      Lenders agree to indemnify the Agent (to the extent not reimbursed by the
      Company), ratably according to the respective principal amounts of the Notes
      then held by each of them (or if no Notes are at the time outstanding or if
      any
      Notes are held by persons which are not Lenders, ratably according to the
      respective amounts of their Loans), from and against any and all liabilities,
      obligations, losses, damages, penalties, actions, judgments, suits, costs,
      expenses or disbursements of any kind or nature whatsoever which may be imposed
      on, incurred by, or asserted against the Agent in any way relating to or arising
      out of this Agreement or any action taken or omitted by the Agent under this
      Agreement, provided that no Lender shall be liable for any portion of such
      liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
      costs, expenses or disbursements resulting from the Agent's gross negligence
      or
      willful misconduct. Without limitation of the foregoing, each Lender agrees
      to
      reimburse the Agent promptly upon demand for its ratable share of any
      out-of-pocket expenses (including counsel fees) incurred by the Agent in
      connection with the preparation, execution, delivery, administration,
      modifications, amendment or enforcement (whether through negotiations, legal
      proceedings or otherwise) of, or legal advice in respect of rights or
      responsibilities under, this Agreement, to the extent that the Agent is not
      reimbursed for such expenses by the Company.

     

    SECTION
      9.5. Successor
      Agent.

     

    The
      Agent
      may resign at any time by giving written notice thereof to the Lenders and
      the
      Company and may be removed at any time with or without cause by the Lenders.
      Upon any such resignation or removal, the Lenders shall have the right to
      appoint a successor Agent.

     

    SECTION
      10. Lenders'
      Investment Representation.

     

    Each
      Lender represents that it is acquiring the Notes for its own account and not
      with a view to the public distribution thereof, and that no Lender has any
      present intention of distributing or reselling the Notes.

    


    SECTION
      11. Amendments.

     

    This
      Credit Agreement may be amended only by an express written agreement signed
      by
      the Lenders, the Agent and the Company.

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

    


    SECTION
      12. Financial
      Advisor.

     

    The
      Agent
      may engage The Recovery Group, a Massachusetts corporation,  or
      a firm
      of comparable expertise (the "Financial Advisor") to provide financial advisory
      services to the Lenders, including, without limitation, review of the Company's
      operations, business plan, cash management and related matters. The Company
      will
      afford the Financial Advisor its complete cooperation and will be responsible
      for payment of its fees and expenses.

     

    SECTION
      13. Expenses.

     

    The
      Company will be responsible for all fees and expenses associated with this
      Agreement, including the fees and expenses of counsel to the Lenders and of
      the
      Financial Advisor. In addition, if the Company defaults hereunder, it shall
      reimburse the Agent and the Lenders for all reasonable costs of collection,
      including reasonable attorneys=
      fees and
      expenses awarded by a court or other tribunal of competent jurisdiction in
      an
      action brought by the Lenders to enforce the terms of this Agreement, the Loan
      Documents or the Notes.

     

    SECTION
      14. No
      Usury.

     

    Nothing
      herein contained shall be construed or so operate as to require the Company
      or
      any other person liable for the payment of any part of the debt evidenced by
      the
      Notes to pay interest in an amount or at a rate greater than the highest
      permissible under applicable law. The Company agrees that the interest rate
      contracted includes the interest rate set forth in the Notes and any other
      charge, fee, cost or expense incident hereto and paid by the Company or on
      its
      behalf to the extent the same are deemed to be interest under applicable
      law.

    


    SECTION
      15. Entire
      Agreement.

     

    This
      Agreement embodies the entire agreement and understanding by and between the
      parties relating to the subject matter hereof and supersedes all prior
      agreements and understandings related thereto.

     

    SECTION
      16. Addresses
      for Notices.

     

    All
      notices, requests, consents and other communications hereunder shall be in
      writing and shall be deemed to have been duly made when delivered, or mailed
      by
      registered or certified mail, return receipt, postage prepaid, and addressed
      as
      follows (or at such other address(es) as a party may designate for itself by
      like notice):

    
      	 	 
	To the Company	VendingData Corporation
	 	6830 Spencer Street
	 	Las Vegas, NV 89119
	 	Attn:
              Arnold Galassi
	 	 
	To the Lenders	LC Capital Master Fund, Ltd.
	 	680 Fifth Avenue
	 	12th
              Floor
	 	New York, NY 10019
	 	Attn: Steven Lampe
	 	 
	 	
              Triage
                Capital Management L.P., Triage Capital
                Management B, L.P., and Triage Offshore Fund, Ltd.

            
	 	401 City Avenue
	 	Bala
              Cynmyd, PA 19004
	 	Attn: Mark Wittman
	 	 
	To the Agent	LC Capital Master Fund, Ltd.
	 	680 Fifth Avenue
	 	12th
              Floor
	 	New York, NY 10019
	 	Attn:
              Steven Lampe


    

     

    
      
         

      

      
        -13-

        
          

        

      

      
         

      

    

     

    SECTION
      17. Miscellaneous.

     

    (a) Replacement
      of Notes.
      Upon
      receipt of evidence reasonably satisfactory to the Company of the ownership
      of
      and the loss, theft, destruction or mutilation of any Note and (in the case
      of
      loss, theft or destruction) upon delivery of an indemnity agreement in an amount
      reasonably satisfactory to the Company, or (in the case of mutilation) upon
      surrender and cancellation of the mutilated Note, the Company will execute
      and
      deliver, in lieu thereof, a new Note of like tenor.

     

    (b) Successors.
      All the
      covenants, agreements, representations and warranties contained in this
      Agreement shall bind the Company, the Lenders and their respective heirs,
      executors, administrators, distributes, successor and assigns permitted in
      accordance with this Agreement.

     

    (c) Headings.
      The
      section headings in this Agreement are inserted for purposes of convenience
      only
      and shall have no substantive effect.

     

    (d) Severability.
      In the
      event of any one or more of the provisions contained in this Agreement or any
      future amendment hereto shall for any reason be held to be invalid, illegal
      or
      unenforceable in any respect, such invalidity, illegality or unenforceability
      shall not affect any other provision of this Agreement, and in lieu of each
      such
      invalid, illegal or unenforceable provision there shall be added automatically
      as part of this Agreement a provision as similar in terms to such invalid,
      illegal or unenforceable provision as may be possible and be valid, legal and
      enforceable.

     

    (e) Law
      Governing.
      This
      Agreement is delivered in the State of Nevada and shall for all purposes be
      construed and enforced in accordance with, and governed by, the internal laws
      of
      the State of Nevada, without giving effect to principles of conflict of
      laws.

    



    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

        
        

      

    



    IN
      WITNESS WHEREOF, the Company, the Lenders and the Agent have executed and
      delivered this Agreement on and as of the day and year first above
      written.

    


    THE
      COMPANY:

     

    VENDINGDATA
      CORPORATION, 

    A
      Nevada
      corporation,

     

    By:
      James
      E. Crabbe

    Name:
      James
      E. Crabbe

    Title:
      Chairman
      of Board

     

    THE
      LENDERS:

     

    LC
      CAPITAL MASTER FUND, LTD., 

    a
      New
      York limited liability company,

     

    By:
      R.
      F.
      Conway

    Name:
      Richard F. Conway

    Title:
      Director

     

    TRIAGE
      CAPITAL MANAGEMENT L.P., 

    a Delaware
      limited partnership

     

    BY:
      Leon
      Frenkel

    Name:
      Leon
      Frenkel

    Title:
      Senior
      Manager

     

    TRIAGE
      CAPITAL MANAGEMENT B, L.P.

     

    BY:
      Leon
      Frenkel

    Name:
      Leon
      Frenkel

    Title:
      Senior
      Manager

     

    TRIAGE
      OFFSHORE FUND, LTD.

     

    BY:
      Leon
      Frenkel

    Name:
      Leon
      Frenkel

    Title:
      Senior
      Manager

     

    THE
      AGENT:

     

    LC
      CAPITAL MASTER FUND, LTD., LLC, 

    a
      New
      York limited liability company

     

    BY:
      R.
      F.
      Conway

    Name:
      Richard F. Conway

    Title:
      Director 

    

      
        
          
          

        

          -15-