Unassociated Document


    Exhibit
      10.10

     

    


     

    THESE
      SECURITIES HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933,
      AS
      AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND ARE “RESTRICTED SECURITIES” AS
      THAT TERM IS DEFINED IN RULE 144 UNDER THE SECURITIES ACT. SUCH SECURITIES
      MAY
      NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT
      TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND THE
      APPLICABLE STATE SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
      THEREUNDER, THE AVAILABILITY OF WHICH IS TO BE ESTABLISHED TO THE REASONABLE
      SATISFACTION OF COUNSEL TO THE ISSUER.

     

    
      	US$___________	 	
              July
                11,
                2006

            


    

     

     

    CONVERTIBLE
      UNSECURED PROMISSORY NOTE

     

    1.  Obligation.
      For
      value received, VENDINGDATA CORPORATION, a Nevada corporation (“Maker”),
      promises to pay to _________________ ("Holder"),
      the
      Principal Amount (as defined below) in the manner and upon the terms and
      conditions set forth herein.

     

    2.  Principal
      Amount.
      The
      principal amount (“Principal Amount”) of this Note is _______________ Dollars
      (US$________). This Note shall not bear interest on the unpaid Principal. The
      Principal Amount shall be due and payable in full on January 7, 2007, unless
      such amount is earlier converted into shares of Common Stock of Maker pursuant
      to Section 3 below. Payments of the Principal Amount shall be made in lawful
      money of the United States of America, by wire transfer in immediately available
      funds to the account designated by the Holder or at such other place as Holder
      may designate in writing. 

     

    3.  Mandatory
      Conversion of Principal Amount.
      Subject
      to and concurrent with the AMEX Approval (as defined below), the Principal
      Amount shall be converted into shares (“Conversion Shares”) of the Maker’s
      common stock, par value $0.001 per share (“Common Stock”), at the rate
      (“Conversion Rate”) of one share of Common Stock for each US$3.50 of Principal
      Amount. Conversion will occur immediately on the AMEX Approval without any
      need
      for further action on the part of Maker or Holder. Certificates representing
      the
      Conversion Shares issued pursuant to this Section 3 will be subject to the
      terms
      and conditions set forth in that certain Share Sale Agreement dated 5 July
      2006
      by and between Maker and Holder (the “Share Sale Agreement”), and will be
      entitled to the rights and subject to the obligations set out in that certain
      Registration Rights Agreement dated of even date herewith by and between the
      Maker and certain holders of shares of Common Stock. As used herein, the term
      “AMEX Approval” shall mean either (i) confirmation from the American Stock
      Exchange (“AMEX”) that the transactions under the Share Sale Agreement do not
      require the approval of the shareholders of the Maker pursuant to Section 712
      of
      the AMEX Company Guide or (ii) the approval of the transactions under the Share
      Sale Agreement by the shareholders of the Maker in accordance with Section
      14 of
      the Securities Exchange Act of 1934 and the rules and regulations thereunder.
      

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    4.  Adjustments
      to Conversion Price and Number of Conversion Shares.
      The
      Conversion Rate and the number of Conversion Shares issuable upon conversion
      will be subject to adjustment from time to time as follows:

     

    A.  If
      the
      shares of Common Stock at any time outstanding are subdivided into a greater
      number or combined into a lesser number of shares of Common Stock or if shares
      of Common Stock are issued as a stock dividend, the Conversion Rate and the
      number of Conversion Shares will be decreased or increased, as the case may
      be,
      to an amount that will bear the same relation to the Conversion Rate and the
      number of Conversion Shares, respectively, in effect immediately prior to such
      subdivision or combination or stock dividend as the total number of shares
      of
      Common Stock outstanding immediately prior to such subdivision or combination
      or
      stock dividend will bear to the total number of shares of Common Stock
      outstanding immediately after such subdivision or combination or stock dividend.
      

     

    B.  In
      the
      event of any capital reorganization, or of any reclassification of the Common
      Stock or in the event of the consolidation or merger of the Company with any
      other corporation in which the Company is not the continuing corporation or
      of
      the sale of the properties and assets of the Company as, or substantially as,
      an
      entirety to any other corporation, this Note will after such capital
      reorganization, reclassification of Common Stock, consolidation, merger or
      sale
      be convertible, upon the terms and conditions specified herein, into the number
      of shares of stock and warrants or other securities or property of the Company,
      or of the corporation resulting from such consolidation or surviving such merger
      or to which such sale will be made, as the case may be, to which the Conversion
      Shares issuable (at the time of such capital reorganization, reclassification
      of
      Common Stock, consolidation, merger, or sale) upon exercise of this Note would
      have been entitled upon such capital reorganization, reclassification of Common
      Stock, consolidation, merger, or sale if such exercise had taken place; and
      in
      any such case, if necessary, the provisions set forth in this Section 4 with
      respect to the rights and interests thereafter of the Holder will be
      appropriately adjusted so as to be applicable, as nearly as may reasonably
      be,
      to any shares of stock or warrants or other securities or property thereafter
      deliverable on the conversion of this Note. The subdivision or combination
      of
      shares of Common Stock at any time outstanding into a greater or lesser number
      of shares of Common Stock will not be deemed to be a reclassification of the
      Common Stock of the Company for the purposes of this Section 4.B. 

     

    C.  Whenever
      there is an adjustment in the Conversion Rate as provided herein, the Company
      will promptly mail to the Holder, by first-class mail, postage prepaid, with
      a
      notice stating that such adjustment has been effected and stating the Conversion
      Rate then in effect and the number of Conversion Shares issuable upon conversion
      as a result of such adjustment. 

     

    D.  Irrespective
      of any adjustments or changes in the number of Conversion Shares actually
      issuable upon conversion of this Note, this Note will continue to express the
      number of Conversion Shares issuable thereunder as expressed in this Note when
      initially issued.

     

    5.  Events
      of Default.
      The
      following shall each constitute an “Event of Default” under this Note: (i)
      default in the payment when due of any amount required hereunder, and (ii)
      any
      of the following events of bankruptcy or insolvency: (A) the Maker shall file
      a
      voluntary bankruptcy or reorganization petition under the provisions of the
      Federal Bankruptcy Act, any other bankruptcy or insolvency law or any other
      similar statute applicable to the Maker (“Bankruptcy Laws”), (B) the Maker shall
      consent to the filing of any bankruptcy or reorganization petition against
      it
      under any Bankruptcy Law, (C) the Maker shall make an assignment for the benefit
      of his creditors, (D) the Maker shall admit in writing its inability to pay
      its
      debts generally as they become due, (E) the Maker shall consent to the
      appointment of a receiver, trustee, or by the order of a court of competent
      jurisdiction, a receiver, liquidator or trustee of the Maker or of any
      substantial part of its property shall not have been discharged within a period
      of sixty (60) days, (F) by decree of such a court, the Maker shall be
      adjudicated bankrupt or insolvent or any substantial part of the property of
      the
      Maker shall have been sequestered and such degree shall have continued
      undischarged and unstayed for a period of sixty (60) days after the entry
      thereof, or (G) an involuntary bankruptcy reorganization petition pursuant
      to
      any Bankruptcy Law shall be filed against the Maker (and, in the case of any
      such petition filed pursuant to any provision of a statute which requires the
      approval of such petition by a court, shall be approved by such a court) and
      shall not be dismissed within sixty (60) days after such filing.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    6.  Expenses
      of Enforcement.
      Maker
      agrees to pay all reasonable costs and expenses, including, without limitation,
      reasonable attorneys’ fees, as a court of competent jurisdiction shall award,
      which Holder shall incur in connection with any legal action or legal proceeding
      commenced for the collection of this Note or the exercise, preservation or
      enforcement of Holder’s rights and remedies thereunder.

     

    7.  Cumulative
      Rights and Remedies.
      All
      rights and remedies of Holder under this Note shall be cumulative and not
      alternative and shall be in addition to all rights and remedies available to
      Holder under applicable law. 

     

    8.  Governing
      Law.
      This
      Note shall be governed by and interpreted and construed in accordance with
      the
      laws of the State of Nevada.

     

    9.  Notices
      and Demands.
      Any
      notice or demand which by any provision of this Note is required or provided
      to
      be given shall be in writing and shall be deemed to have been given or served
      sufficiently for all purposes if sent as provided in the Share Sale Agreement
      or
      through a nationally-recognized overnight courier and simultaneously transmitted
      by facsimile to the following respective addresses and facsimile telephone
      numbers:

     

    
      	
              Maker:

            	 	
              VendingData
                Corporation.

               6830
                Spencer Street

              Las
                Vegas, NV 89119

              Attention:
                Mark R. Newburg, 

              President
                and Chief Executive Officer

              Facsimile:
                (702) 733-7197

            


    

     

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

     

    
      	
              Holder:

            	 	 


    

     

    


    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    or
      at any
      other address designated by Holder to Maker in writing, and if to an assignee
      of
      Holder, to its address as designated to Maker in writing.

     

    IN
      WITNESS WHEREOF, Maker has caused this Note to be executed and delivered at
      Las
      Vegas, Nevada effective as of the day and year first above written.

     

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


    

         

     

    
      
        
        

      

      
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