Document:

Exhibit
        10.2

    

    

    AMENDED
      AND RESTATED SECURITIES PUT AGREEMENT

     

    This
      Amended and Restated Securities Put Agreement (this “Agreement”)
      is
      dated as of May 1, 2006, among VendingData Corporation, a Nevada corporation
      (the “Company”),
      and
      Bricoleur Partners, L.P., Bricoleur Enhanced, L.P., BRIC 6, L.P. and Bricoleur
      Offshore Ltd. (each, including its successors and assigns, a “Purchaser”
and
      collectively the “Purchasers”).

     

    RECITALS 

     

    A. WHEREAS,
      the Company and the Purchasers are parties to that certain Securities Put
      Agreement, dated as of March 29, 2006 (the “Original Agreement”), pursuant to
      which the Purchasers agreed to purchase, and the Company agreed to sell, certain
      securities of the Company, and the parties intend for this Agreement to
      supersede and replace the Original Agreement in its entirety 

     

    B. WHEREAS,
      subject to the terms and conditions set forth in this Agreement and pursuant
      to
      Section 4(2) of the Securities Act of 1933, as amended (the “Securities
      Act”)
      and
      Rule 506 promulgated thereunder, the Company desires to issue and sell to each
      Purchaser, and each Purchaser, severally and not jointly, desires to purchase
      from the Company, up to $5,000,000 shares of Common Stock (as defined below),
      as
      more fully described in this Agreement.

     

    C. WHEREAS,
      concurrent with close of the purchase and sale of securities under this
      Agreement, the Company will sell to the Purchasers $13 million of 8% Senior
      Secured Notes (“Notes”) pursuant to that certain Note Purchase Agreement
      (“Note
      Purchase Agreement”)
      of the
      same date herewith. 

     

    AGREEMENT

     

    NOW,
      THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement,
      and for other good and valuable consideration the receipt and adequacy of which
      are hereby acknowledged, the Company and each Purchaser agree as
      follows:

     

    ARTICLE
      I.

     

    DEFINITIONS

     

    1.1 Definitions.
      In
      addition to the terms defined elsewhere in this Agreement, for all purposes
      of
      this Agreement, the following terms have the meanings indicated in this Section
      1.1:

     

    “Action”
shall
      have the meaning ascribed to such term in Section 3.1(j).

     

    “Affiliate”
means
      any Person that, directly or indirectly through one or more intermediaries,
      controls or is controlled by or is under common control with a Person as such
      terms are used in and construed under Rule 144 under the Securities Act. With
      respect to a Purchaser, any investment fund or managed account that is managed
      on a discretionary basis by the same investment manager as such Purchaser will
      be deemed to be an Affiliate of such Purchaser.

    

    
      
        
          
          

        

        
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    “Business
      Day”
means
      any day except Saturday, Sunday and any day which shall be a federal legal
      holiday in the United States.

     

    “Change
      in Control”
shall
      mean the occurrence of any of the following events: (i) a sale of all or
      substantially all of the assets of the Company; (ii) a liquidation or
      dissolution of the Company; (iii) a merger or consolidation in which the
      Company is not the surviving corporation,
      unless
the
      stockholders of the Company immediately prior to such consolidation, merger
      or
      reorganization, own more than 50% of the Company’s voting power immediately
      after such;
      (iv) a reverse merger in which the Company is the surviving corporation but
      the shares of Common Stock and securities convertible into Common Stock
      outstanding immediately preceding the merger are converted by virtue of the
      merger into other property, whether in the form of securities, cash or
      otherwise; (v) any consolidation or merger of the Company, or any other
      corporate reorganization, in which the stockholders of the Company immediately
      prior to such consolidation, merger or reorganization, own less than 50% of
      the
      Company’s voting power immediately after such consolidation, merger or
      reorganization; or (vi) any Person other than James Crabbe becomes the
      owner, directly or indirectly, of securities of the Company representing more
      than 50% of the combined voting power of the Company’s then outstanding
      securities; provided,
      however,
      that a
“Change in Control” shall not include any transaction the sole purpose of which
      is to change the state of the Company’s incorporation.

     

    “Closing”
means
      each Closing of the purchase and sale of the Subscription Shares pursuant to
      Section 2.1.

     

    “Closing
      Date”
means,
      as to each Closing, the date, which shall be a Business Day, designated in
      the
      relevant Subscription Notice for the Closing of the purchase and sale of the
      Subscription Shares set forth in such notice. 

     

    “Commission”
means
      the Securities and Exchange Commission.

     

    “Common
      Stock”
means
      the common stock of the Company, par value $0.001 per share, and any other
      class
      of securities into which such securities may hereafter be reclassified or
      changed into. 

     

    “Common
      Stock Equivalents”
means
      any securities of the Company or the Subsidiaries which would entitle the holder
      thereof to acquire at any time Common Stock, including, without limitation,
      any
      debt, preferred stock, rights, options, warrants or other instrument that is
      at
      any time convertible into or exercisable or exchangeable for, or otherwise
      entitles the holder thereof to receive, Common Stock.

     

    “Company
      Counsel”
means
      Preston Gates & Ellis LLP.

     

    “Disclosure
      Schedules”
means
      the Disclosure Schedules of the Company delivered in connection with each
      Closing. 

    

    
      
        
          
          

        

        
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    “Effective
      Date”
means
      the date that the initial Registration Statement filed by the Company pursuant
      to the Registration Rights Agreement is first declared effective by the
      Commission.

     

    “Exchange
      Act”
means
      the Securities Exchange Act of 1934, as amended, and the rules and regulations
      promulgated thereunder.

    

    “GAAP”
shall
      have the meaning ascribed to such term in Section 3.1(h).

     

    “Intellectual
      Property Rights”
shall
      have the meaning ascribed to such term in Section 3.1(o).

     

    “Liens”
means
      a
      lien, charge, security interest, encumbrance, right of first refusal, preemptive
      right or other restriction.

     

    “Material
      Adverse Effect”
shall
      have the meaning assigned to such term in Section 3.1(b).

     

    “Material
      Permits”
shall
      have the meaning ascribed to such term in Section 3.1(m).

     

    “Person”
means
      an individual or corporation, partnership, trust, incorporated or unincorporated
      association, joint venture, limited liability company, joint stock company,
      government (or an agency or subdivision thereof) or other entity of any
      kind.

     

    “Proceeding”
means
      an action, claim, suit, investigation or proceeding (including, without
      limitation, an investigation or partial proceeding, such as a deposition),
      whether commenced or threatened.

     

    “Registration
      Rights Agreement”
means
      the Registration Rights Agreement, dated the date hereof, among the Company
      and
      the Purchasers, in the form of Exhibit
      A
      attached
      hereto.

     

    “Registration
      Statement”
means
      a
      registration statement meeting the requirements set forth in the Registration
      Rights Agreement and covering the resale by the Purchasers of the Subscription
      Shares. 

     

    “Required
      Approvals”
shall
      have the meaning ascribed to such term in Section 3.1(e).

     

    “Rule
      144”
means
      Rule 144 promulgated by the Commission pursuant to the Securities Act, as such
      Rule may be amended from time to time, or any similar rule or regulation
      hereafter adopted by the Commission having substantially the same effect as
      such
      Rule. 

     

    “SEC
      Reports”
shall
      have the meaning ascribed to such term in Section 3.1(h).

    

    
      
        
          
          

        

        
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    “Short
      Sales”
shall
      include all “short sales” as defined in Rule 200 of Regulation SHO under the
      Exchange Act (but
      shall not be deemed to include the location and/or reservation of borrowable
      shares of Common Stock). 

     

    “Subscription
      Amount”
means,
      as to each Closing, the aggregate dollar amount to be paid for the Subscription
      Shares at the Closing as specified in the Subscription Notice.

     

    “Subscription
      Commitment Amount”
means,
      as to each Purchaser, the total amount committed by the Purchasers for the
      Purchase of Subscription Shares, from time to time, as specified below such
      Purchaser’s name on the signature page of this Agreement and next to the heading
“Subscription Commitment Amount”, in United States Dollars and in immediately
      available funds.

     

    “Subscription
      Shares”
means,
      as to each Closing, the aggregate number of shares of Common Stock to be
      purchased by the Purchasers. 

     

    “Subscription
      Notice”
shall
      mean a written notice to the Purchasers, delivered via facsimile, setting forth
      the Subscription Amount that the Company requests from the Purchasers, including
      the Subscription Price and the Closing Date. The Company shall be entitled
      to
      send a Subscription Notice only during the fifteen Business Day period
      immediately following the Company’s filing with the Commission of an Annual
      Report on Form 10-K or 10-KSB or Quarterly Report on Form 10-Q or 10-QSB. The
      Company shall only send a Subscription Notice between 6:30 A.M. and 1:30 P.M.
      (Pacific time) on a Trading Day; provided, however, the Company shall not be
      entitled to send a Subscription Notice after 1:00 P.M. if it subsequently issues
      a press release on that same Trading Day. Unless otherwise mutually agreed
      by
      the Purchasers and the Company in writing, the Closing Date shall be no sooner
      than five (5) Business Days and no later than fifteen (15) Business Days after
      the date on which the Subscription Notice is received by the Purchasers.

     

    “Subscription
      Price”
means,
      as to each Subscription Share purchased in a Closing, eighty percent (80%)
      of
      the VWAP on the same Trading Day on which the Company delivers the Subscription
      Notice; provided that in no event shall the Subscription Price exceed $3.50
      per
      Subscription Share (subject to adjustment for any stock split, reverse stock
      split or other similar event affecting the Common Stock after the date hereof).
      

     

    “Subsidiary”
means
      any subsidiary of the Company as set forth on Schedule
      3.1(a).

     

    “Shareholder
      Approval”
means
      such approval as may be required by the applicable rules and regulations of
      the
      American Stock Exchange (or any successor entity) from the shareholders of
      the
      Company in accordance with Section 14 of the Exchange Act with respect to the
      transactions contemplated by the Transaction Documents.

     

    
      
        
          
          

        

        
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    “Trading
      Day”
means
      a
      day on which the Common Stock is traded on a Trading Market.

     

    “Trading
      Market”
means
      the following markets or exchanges on which the Common Stock is listed or quoted
      for trading on the date in question: the Nasdaq Capital Market, the American
      Stock Exchange, the New York Stock Exchange, the Nasdaq National Market or
      the
      OTC Bulletin Board.

     

    “Transaction
      Documents”
means
      this Agreement and the Registration Rights Agreement and any other documents
      or
      agreements executed in connection with the transactions contemplated
      hereunder.

     

    ARTICLE
      II.

     

    PURCHASE
      AND SALE

     

    2.1 Closing.
      Upon the terms and subject to the conditions set forth herein, the Company
      agrees to sell, and each Purchaser agrees to purchase, severally and not
      jointly, the Purchaser’s pro rata share of the Subscription Shares to be
      purchased by the Purchasers at each Closing. Each Closing shall be for a minimum
      of at least one million dollars ($1,000,000) of Subscription Shares. Each
      Purchaser’s pro rata share of the Subscription Shares shall be determined by
      multiplying the Subscription Shares by a fraction the numerator of which is
      the
      Purchaser’s Subscription Commitment Amount and the denominator of which is
      $5,000,000. The Purchasers shall purchase the Subscription Shares at each
      Closing at a purchase price equal to the Subscription Price. At each Closing,
      each Purchaser shall deliver to the Company, via wire transfer or a certified
      check, immediately available funds equal to their portion of the Subscription
      Amount, and the Company shall deliver to each Purchaser their respective
      Subscription Shares to be issued at the Closing. Upon satisfaction of the
      conditions set forth in Sections 2.2 and 2.3, Closing shall occur at the offices
      of the Company, or such other location as the parties shall mutually agree,
      on
      the Closing Date (“Closing Date”) set forth in the Subscription Notice. Unless
      otherwise mutually agreed by the Purchasers and the Company in writing, the
      Closing Date shall be no sooner than five (5) Business Days and no later than
      fifteen (15) Business Days after the date on which the Subscription Notice
      is
      received by the Purchasers. The Purchasers shall have no obligation to purchase
      Subscription Shares after five (5) years from the date of this Agreement, or
      if
      sooner, at any time after the Purchasers have purchased an aggregate of five
      million dollars ($5,000,000) of Subscriptions Shares. In addition, the
      Purchasers shall have no obligation to purchase Subscription Shares at any
      time
      after a Change in Control. If mutually agreed by two or more Purchasers, such
      Purchasers may agree to adjust the relative amounts of their Subscription
      Commitment Amounts, Subscription Amounts or the amount of Subscription Shares
      to
      be purchased by them at any Closing, provided that the sum of such amounts
      is
      not thereby reduced. 

    

    
      
        
          
          

        

        
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    2.2 Deliveries.

     

    (a) On
      or
      prior to each Closing, the Company shall deliver or cause to be delivered to
      each Purchaser the following:

     

    (i) as
      to the
      initial Closing only, this Agreement duly executed by the Company;

     

    (ii) as
      to the
      initial Closing only, the Registration Rights Agreement duly executed by the
      Company;

     

    (iii) as
      to the
      initial Closing only, a legal opinion of Company Counsel, in the form acceptable
      to the Purchasers in their reasonable discretion; 

     

    (iv) as
      to the
      initial Closing only, the Note Purchase Agreement duly executed by the
      Purchasers and the Company, and evidence that the full $13,000,000 purchase
      price for the Notes sold thereby has been received by the Company;

     

    (v) a
      Subscription Notice prepared and delivered in accordance herewith; 

     

    (vi) a
      copy of
      the irrevocable instructions to the Company’s transfer agent instructing the
      transfer agent to deliver, on an expedited basis, certificates evidencing the
      Subscription Shares purchased by each Purchaser hereunder registered in the
      name
      of each Purchaser; 

     

    (vii) the
      Disclosure Schedules, as updated as necessary; and 

     

    (viii) an
      Officer’s Certificate in the form acceptable to the Purchasers in their
      reasonable discretion. 

     

    (b) On
      or
      prior to each Closing, each Purchaser shall deliver or cause to be delivered
      to
      the Company the following:

     

    (i) as
      to the
      initial Closing only, this Agreement duly executed by such
      Purchaser;

     

    (ii) as
      to the
      initial Closing only, the Registration Rights Agreement duly executed by the
      Purchaser; and

     

    (iii) such
      Purchaser’s pro rata Subscription Amount by wire transfer or cashier’s check to
      the account as specified by the Company. 

    

    
      
        
          
          

        

        
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    2.3 Closing
      Conditions. 

     

    (a) The
      obligations of the Company hereunder in connection with each Closing are subject
      to the following conditions being met:

     

    (i) the
      accuracy in all material respects when made and on the Closing Date of the
      representations and warranties of the Purchasers contained herein; 

     

    (ii) all
      obligations, covenants and agreements of the Purchasers required to be performed
      at or prior to the Closing Date shall have been performed; 

     

    (iii) the
      delivery by the Purchasers of the items set forth in Section 2.2(b) of this
      Agreement; and 

     

    (iv) the
      Company shall have obtained Shareholder Approval.

     

    (b) The
      respective obligations of the Purchasers hereunder in connection with each
      Closing are subject to the following conditions being met:

     

    (i) the
      accuracy of the representations and warranties of the Company contained herein
      as of the date of this Agreement;

     

    (ii) the
      accuracy of the representations and warranties of the Company contained herein,
      as modified by the Disclosure Schedule delivered at such Closing, provided
      that
      any additional or different disclosure included in such Disclosure
      Schedule
      (considered collectively) do not constitute, and could not reasonably be
      expected to have or result in, a Material Adverse Effect.

     

    (iii) all
      obligations, covenants and agreements of the Company required to be performed
      at
      or prior to the Closing Date shall have been performed; and

     

    (iv) the
      delivery by the Company of the items set forth in Section 2.2(a) of this
      Agreement; 

     

    (v) the
      Company shall have obtained Shareholder Approval; and

     

    (vi) the
      Company is not in breach or default of any obligation, covenant or agreement
      under the Note Purchase Agreement, Registration Rights Agreement, the Notes,
      the
      Warrants or the Security Agreement (as the terms Notes, Warrants and Security
      Agreement are defined in the Note Purchase Agreement).

    

    
      
        
          
          

        

        
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    ARTICLE
      III.

     

    REPRESENTATIONS
      AND WARRANTIES

     

    3.1 Representations
      and Warranties of the Company. Except
      as
      set forth under the corresponding section of the disclosure schedules delivered
      to the Purchasers concurrently herewith or at any Closing (the “Disclosure
      Schedules”) which Disclosure Schedules shall be deemed a part hereof, the
      Company hereby makes the representations and warranties set forth below to
      each
      Purchaser as of the date hereof and as of each Closing:

     

    (a) Subsidiaries.
      All of
      the direct and indirect subsidiaries of the Company are set forth on
Schedule
      3.1(a).
      The
      Company owns, directly or indirectly, all of the capital stock or other equity
      interests of each Subsidiary free and clear of any Liens, and all the issued
      and
      outstanding shares of capital stock of each Subsidiary are validly issued and
      are fully paid, non-assessable and free of preemptive and similar rights to
      subscribe for or purchase securities. 

     

    (b) Organization
      and Qualification.
      The
      Company and each of the Subsidiaries is an entity duly incorporated or otherwise
      organized, validly existing and in good standing under the laws of the
      jurisdiction of its incorporation or organization (as applicable), with the
      requisite power and authority to own and use its properties and assets and
      to
      carry on its business as currently conducted. Neither the Company nor any
      Subsidiary is in violation or default of any of the provisions of its respective
      certificate or articles of incorporation, bylaws or other organizational or
      charter documents. Each of the Company and the Subsidiaries is duly qualified
      to
      conduct business and is in good standing as a foreign corporation or other
      entity in each jurisdiction in which the nature of the business conducted or
      property owned by it makes such qualification necessary, except where the
      failure to be so qualified or in good standing, as the case may be, could not
      have or reasonably be expected to result in (i) a material adverse effect on
      the
      legality, validity or enforceability of any Transaction Document, (ii) a
      material adverse effect on the Company and the Subsidiaries, taken as a whole,
      or (iii) a material adverse effect on the Company’s ability to perform in any
      material respect on a timely basis its obligations under any Transaction
      Document (any of (i), (ii) or (iii), a “Material
      Adverse Effect”)
      and no
      Proceeding has been instituted in any such jurisdiction revoking, limiting
      or
      curtailing or seeking to revoke, limit or curtail such power and authority
      or
      qualification.

     

    (c) Authorization;
      Enforcement.
      Subject
      to Shareholder Approval, the Company has the requisite corporate power and
      authority to enter into and to consummate the transactions contemplated by
      each
      of the Transaction Documents and otherwise to carry out its obligations
      hereunder and thereunder. The execution and delivery of each of the Transaction
      Documents by the Company and the consummation by it of the transactions
      contemplated hereby and thereby have been duly authorized by all necessary
      action on the part of the Company and no further action is required by the
      Company, its board of directors or its stockholders in connection therewith
      other than in connection with the Required Approvals. Each Transaction Document
      has been (or upon delivery will have been) duly executed by the Company and,
      when delivered in accordance with the terms hereof and thereof, will constitute
      the valid and binding obligation of the Company enforceable against the Company
      in accordance with its terms except (i) as limited by general equitable
      principles and applicable bankruptcy, insolvency, reorganization, moratorium
      and
      other laws of general application affecting enforcement of creditors’ rights
      generally, (ii) as limited by laws relating to the availability of specific
      performance, injunctive relief or other equitable remedies and (iii) insofar
      as
      indemnification and contribution provisions may be limited by applicable
      law.

    

    
      
        
          
          

        

        
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    (d) No
      Conflicts.
      The
      execution, delivery and performance of the Transaction Documents by the Company,
      the issuance and sale of the Subscription Shares and the consummation by the
      Company of the other transactions contemplated hereby and thereby do not and
      will not (i) conflict with or violate any provision of the Company’s or any
      Subsidiary’s certificate or articles of incorporation, bylaws or other
      organizational or charter documents, 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, result in the creation of any Lien upon any of the properties
      or
      assets of the Company or any Subsidiary, or give to others any rights of
      termination, amendment, acceleration or cancellation (with or without notice,
      lapse of time or both) of, any agreement, credit facility, debt or other
      instrument (evidencing a Company or Subsidiary debt or otherwise) or other
      understanding to which the Company or any Subsidiary is a party or by which
      any
      property or asset of the Company or any Subsidiary is bound or affected, or
      (iii) subject to the Required Approvals, conflict with or result in a violation
      of any law, rule, regulation, order, judgment, injunction, decree or other
      restriction of any court or governmental authority to which the Company or
      a
      Subsidiary is subject (including federal and state securities laws and
      regulations), or by which any property or asset of the Company or a Subsidiary
      is bound or affected.

     

    (e) Filings,
      Consents and Approvals.
      Except
      as set forth on Schedule 3.1(e),
      the
      Company is not required to obtain any consent, waiver, authorization or order
      of, give any notice to, or make any filing or registration with, any court
      or
      other federal, state, local or other governmental authority or other Person
      in
      connection with the execution, delivery and performance by the Company of the
      Transaction Documents, other than (i) filings required pursuant to Section
      4.4
      of this Agreement, (ii) the filing with the Commission of the Registration
      Statement, (iii) application(s) to each applicable Trading Market for the
      listing of the Subscription Shares for trading thereon in the time and manner
      required thereby, (iv) the filing of Form D with the Commission and such filings
      as are required to be made under applicable state securities laws, and (vi)
      the
      Company shall have obtained Shareholder Approval
      (collectively, the “Required
      Approvals”).

     

    (f) Issuance
      of the Subscription Shares.
      The
      Subscription Shares are duly authorized and, when issued and paid for in
      accordance with the applicable Transaction Documents and subject to Shareholder
      Approval, will be duly and validly issued, fully paid and nonassessable, free
      and clear of all Liens imposed by the Company other than restrictions on
      transfer provided for in the Transaction Documents. The Company has reserved
      from its duly authorized capital stock the Subscription Shares issuable pursuant
      to this Agreement.

    

    
      
        
          
          

        

        
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    (g) Capitalization.
      The
      capitalization of the Company is as set forth on Schedule
      3.1(g).
      No
      Person has any right of first refusal, preemptive right, right of participation,
      or any similar right to participate in the transactions contemplated by the
      Transaction Documents. Except as a result of the purchase and sale of the
      Subscription Shares or as set forth on Schedule
      3.1(g),
      there
      are no outstanding options, warrants, script rights to subscribe to, calls
      or
      commitments of any character whatsoever relating to, or securities, rights
      or
      obligations convertible into or exercisable or exchangeable for, or giving
      any
      Person any right to subscribe for or acquire, any shares of Common Stock, or
      contracts, commitments, understandings or arrangements by which the Company
      or
      any Subsidiary is or may become bound to issue additional shares of Common
      Stock
      or Common Stock Equivalents. The issuance and sale of the Subscription Shares
      will not obligate the Company to issue shares of Common Stock or other
      securities to any Person (other than the Purchasers) and will not result in
      a
      right of any holder of Company securities to adjust the exercise, conversion,
      exchange or reset price under any of such securities. All of the outstanding
      shares of capital stock of the Company are validly issued, fully paid and
      nonassessable, have been issued in compliance with all federal and state
      securities laws, and none of such outstanding shares was issued in violation
      of
      any preemptive rights or similar rights to subscribe for or purchase securities.
      Other than Shareholder Approval, there are no further approval or authorization
      of any stockholder, the Board of Directors of the Company or others is required
      for the issuance and sale of the Subscription Shares. Except as set forth on
      Schedule
      3.1(g),
      there
      are no stockholders agreements, voting agreements or other similar agreements
      with respect to the Company’s capital stock to which the Company is a party or,
      to the knowledge of the Company, between or among any of the Company’s
      stockholders.

     

    (h) SEC
      Reports; Financial Statements.
      The
      Company has filed all reports, schedules, forms, statements and other documents
      required to be filed by it under the Securities Act and the Exchange Act,
      including pursuant to Section 13(a) or 15(d) thereof, for the period commencing
      January 1, 2005 through the date hereof and any Closing (the foregoing
      materials, including the exhibits thereto and documents incorporated by
      reference therein, being collectively referred to herein as the “SEC
      Reports”)
      on a
      timely basis or has received a valid extension of such time of filing and has
      filed any such SEC Reports prior to the expiration of any such extension. Except
      as set forth on Schedule
      3.1(h),
      as of
      their respective dates, the SEC Reports complied in all material respects with
      the requirements of the Securities Act and the Exchange Act and the rules and
      regulations of the Commission promulgated thereunder, as applicable, and none
      of
      the SEC Reports, when filed, 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 the light of the circumstances
      under
      which they were made, not misleading. Except as set forth on Schedule
      3.1(h),
      the
      financial statements of the Company included in the SEC Reports complied in
      all
      material respects with applicable accounting requirements and the rules and
      regulations of the Commission with respect thereto as in effect at the time
      of
      filing. Except as set forth on Schedule
      3.1(h),
      such
      financial statements have been prepared in accordance with United States
      generally accepted accounting principles applied on a consistent basis during
      the periods involved (“GAAP”),
      except as may be otherwise specified in such financial statements or the notes
      thereto and except that unaudited financial statements may not contain all
      footnotes required by GAAP, and fairly present in all material respects the
      financial position of the Company and its consolidated subsidiaries as of and
      for the dates thereof and the results of operations and cash flows for the
      periods then ended, subject, in the case of unaudited statements, to normal,
      immaterial, year-end audit adjustments.

    

    
      
        
          
          

        

        
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    (i) Material
      Changes; Undisclosed Events, Liabilities or Developments.
      Since
      the date of the latest audited financial statements included within the SEC
      Reports, except as specifically disclosed in a subsequent SEC Report or as
      set
      forth on Schedule
      3.1(i),
      (i)
      there has been no event, occurrence or development that has had or that could
      reasonably be expected by the Company to result in a Material Adverse Effect,
      (ii) the Company has not incurred any liabilities (contingent or otherwise)
      other than (A) trade payables and accrued expenses incurred in the ordinary
      course of business consistent with past practice and (B) liabilities not
      required to be reflected in the Company’s financial statements pursuant to GAAP
      or disclosed in filings made with the Commission, (iii) the Company has not
      altered its method of accounting, (iv) the Company has not declared or made
      any
      dividend or distribution of cash or other property to its stockholders or
      purchased, redeemed or made any agreements to purchase or redeem any shares
      of
      its capital stock and (v) the Company has not issued any equity securities
      to
      any officer, director or Affiliate, except pursuant to existing Company stock
      option plans. The Company does not have pending before the Commission any
      request for confidential treatment of information. 

     

    (j) Litigation.
      There
      is no action, suit, inquiry, notice of violation, proceeding or investigation
      pending or, to the knowledge of the Company, threatened against or affecting
      the
      Company, any Subsidiary or any of their respective properties before or by
      any
      court, arbitrator, governmental or administrative agency or regulatory authority
      (federal, state, county, local or foreign) (collectively, an “Action”)
      which
      materially adversely affects or challenges the legality, validity or
      enforceability of any of the Transaction Documents or the Subscription Shares.
      There is no Action that has not been disclosed in the SEC Reports. The
      Commission has not issued any stop order or other order suspending the
      effectiveness of any registration statement filed by the Company or any
      Subsidiary under the Exchange Act or the Securities Act. 

     

    (k) Labor
      Relations.
      No
      material labor dispute exists or, to the knowledge of the Company, is imminent
      with respect to any of the employees of the Company which could reasonably
      be
      expected to result in a Material Adverse Effect. None of the Company’s or its
      Subsidiaries’ employees is a member of a union that relates to such employee’s
      relationship with the Company, and neither the Company or any of its
      Subsidiaries is a party to a collective bargaining agreement, and the Company
      and its Subsidiaries believe that their relationships with their employees
      are
      good. No executive officer, to the knowledge of the Company, is, or is now
      expected to be, in violation of any material term of any employment contract,
      confidentiality, disclosure or proprietary information agreement or
      non-competition agreement, or any other contract or agreement or any restrictive
      covenant, and the continued employment of each such executive officer does
      not
      subject the Company or any of its Subsidiaries to any liability with respect
      to
      any of the foregoing matters. The Company and its Subsidiaries are in compliance
      with all U.S. federal, state, local and foreign laws and regulations relating
      to
      employment and employment practices, terms and conditions of employment and
      wages and hours, except where the failure to be in compliance could not,
      individually or in the aggregate, reasonably be expected to have a Material
      Adverse Effect.

    

    
      
        
          
          

        

        
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    (l) Compliance.
      Neither
      the Company nor any Subsidiary (i) is in default under or in violation of (and
      no event has occurred that has not been waived that, with notice or lapse of
      time or both, would result in a default by the Company or any Subsidiary under),
      nor has the Company or any Subsidiary received notice of a claim that it is
      in
      default under or that it is in violation of, any indenture, loan or credit
      agreement or any other agreement or instrument to which it is a party or by
      which it or any of its properties is bound (whether or not such default or
      violation has been waived), (ii) is in violation of any order of any court,
      arbitrator or governmental body, or (iii) is or has been in violation of any
      statute, rule or regulation of any governmental authority, including without
      limitation all foreign, federal, state and local laws applicable to its business
      and all such laws that affect the environment.

     

    (m) Regulatory
      Permits.
      The
      Company and the Subsidiaries possess all certificates, authorizations and
      permits issued by the appropriate federal, state, local or foreign regulatory
      authorities necessary to conduct their respective businesses as described in
      the
      SEC Reports, except where the failure to possess such permits could not have
      or
      reasonably be expected to result in a Material Adverse Effect (“Material
      Permits”),
      and
      neither the Company nor any Subsidiary has received any notice of proceedings
      relating to the revocation or modification of any Material Permit.

     

    (n) Title
      to Assets.
      Except
      as set forth on Schedule
      3.1(n),
      the
      Company and the Subsidiaries have good and marketable title in fee simple to
      all
      real property owned by them that is material to the business of the Company
      and
      the Subsidiaries and good and marketable title in all personal property owned
      by
      them that is material to the business of the Company and the Subsidiaries,
      in
      each case free and clear of all Liens, except for Liens 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 the
      Subsidiaries and Liens for the payment of federal, state or other taxes, the
      payment of which is neither delinquent nor subject to penalties. Any real
      property and facilities held under lease by the Company and the Subsidiaries
      are
      held by them under valid, subsisting and enforceable leases with which the
      Company and the Subsidiaries are in compliance.

     

    (o) Patents
      and Trademarks.
      The
      Company and the Subsidiaries have, or have rights to use, all patents, patent
      applications, trademarks, trademark applications, service marks, trade names,
      trade secrets, inventions, copyrights, licenses and other intellectual property
      rights and similar rights necessary or material for use in connection with
      their
      respective businesses as described in the SEC Reports (collectively, the
“Intellectual
      Property Rights”).
      Neither the Company nor any Subsidiary has received a notice (written or
      otherwise) that the Intellectual Property Rights used by the Company or any
      Subsidiary violates or infringes upon the rights of any Person. To the knowledge
      of the Company, all such Intellectual Property Rights are enforceable and there
      is no existing infringement by another Person of any of the Intellectual
      Property Rights. The Company and its Subsidiaries have taken reasonable security
      measures to protect the secrecy, confidentiality and value of all of their
      intellectual properties.

    

    
      
        
          
          

        

        
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    (p) Insurance.
      The
      Company and the Subsidiaries are insured by insurers of recognized financial
      responsibility against such losses and risks and in such amounts as are prudent
      and customary in the businesses in which the Company and the Subsidiaries are
      engaged, including, but not limited to, directors and officers insurance
      coverage at least equal to the aggregate Subscription Amount. Neither the
      Company nor any Subsidiary has any reason to believe that it will not be able
      to
      renew its existing insurance coverage as and when such coverage expires or
      to
      obtain similar coverage from similar insurers as may be necessary to continue
      its business without a significant increase in cost.

     

    (q) Transactions
      With Affiliates and Employees.
      Except
      as set forth in the SEC Reports, none of the officers or directors of the
      Company and, to the knowledge of the Company, none of the employees of the
      Company is presently a party to any transaction with the Company or any
      Subsidiary (other than for services as employees, officers and directors),
      including any contract, agreement or other arrangement providing for the
      furnishing of services to or by, providing for rental of real or personal
      property to or from, or otherwise requiring payments to or from any officer,
      director or such employee or, to the knowledge of the Company, any entity in
      which any officer, director, or any such employee has a substantial interest
      or
      is an officer, director, trustee or partner, in each case in excess of $60,000
      other than (i) for payment of salary or consulting fees for services rendered,
      (ii) reimbursement for expenses incurred on behalf of the Company and (iii)
      for
      other employee benefits, including stock option agreements under any stock
      option plan of the Company.

     

    (r) Sarbanes-Oxley;
      Internal Accounting Controls.
      The
      Company is in material compliance with all provisions of the Sarbanes-Oxley
      Act
      of 2002 which are applicable to it as of the Closing Date. 

     

    (s) Certain
      Fees.
      No
      brokerage or finder’s fees or commissions are or will be payable by the Company
      to any broker, financial advisor or consultant, finder, placement agent,
      investment banker, bank or other Person with respect to the transactions
      contemplated by the Transaction Documents. The Purchasers shall have no
      obligation with respect to any fees or with respect to any claims made by or
      on
      behalf of other Persons for fees of a type contemplated in this Section that
      may
      be due in connection with the transactions contemplated by the Transaction
      Documents as a result of any action taken by the Company or its
      Affiliates.

     

    (t) Private
      Placement.
      Assuming the accuracy of the Purchasers representations and warranties set
      forth
      in Section 3.2, no registration under the Securities Act is required for the
      offer and sale of the Subscription Shares by the Company to the Purchasers
      as
      contemplated hereby. Subject to receipt of Shareholder Approval, the issuance
      and sale of the Subscription Shares hereunder does not contravene the rules
      and
      regulations of the Trading Market.

    

    
      
        
          
          

        

        
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    (u) Investment
      Company.
      The
      Company is not, and is not an Affiliate of, and immediately after receipt of
      payment for the Subscription Shares, will not be or be an Affiliate of, an
      “investment company” within the meaning of the Investment Company Act of 1940,
      as amended. The Company shall conduct its business in a manner so that it will
      not become subject to the Investment Company Act.

     

    (v) Registration
      Rights.
      Other
      than each of the Purchasers, no Person has any right to cause the Company to
      effect the registration under the Securities Act of any securities of the
      Company.

     

    (w) Listing
      and Maintenance Requirements.
      The
      Company’s Common Stock is registered pursuant to Section 12(b) or 12(g) of the
      Exchange Act, and the Company has taken no action designed to, or which to
      its
      knowledge is likely to have the effect of, terminating the registration of
      the
      Common Stock under the Exchange Act nor has the Company received any
      notification that the Commission is contemplating terminating such registration.
      The Company has not, in the 12 months preceding the date hereof, received notice
      from any Trading Market on which the Common Stock is or has been listed or
      quoted to the effect that the Company is not in compliance with the listing
      or
      maintenance requirements of such Trading Market. The Company is, and has no
      reason to believe that it will not in the foreseeable future continue to be,
      in
      compliance with all such listing and maintenance requirements.

     

    (x) Application
      of Takeover Protections.
      The
      Company and its Board of Directors have taken all necessary action, if any,
      in
      order to render inapplicable any control share acquisition, business
      combination, poison pill (including any distribution under a rights agreement)
      or other similar anti-takeover provision under the Company’s Certificate of
      Incorporation (or similar charter documents) or the laws of its state of
      incorporation that is or could become applicable to the Purchasers as a result
      of the Purchasers and the Company fulfilling their obligations or exercising
      their rights under the Transaction Documents, including without limitation
      as a
      result of the Company’s issuance of the Subscription Shares and the Purchasers’
ownership of the Subscription Shares.

     

    (y) Disclosure.
      All
      disclosure furnished by or on behalf of the Company to the Purchasers regarding
      the Company, its business and the transactions contemplated hereby, including
      the Disclosure Schedules to this Agreement, with respect to the representations
      and warranties made herein are true and correct with respect to such
      representations and warranties and do not contain any untrue statement of a
      material fact or omit to state any material fact necessary in order to make
      the
      statements made therein, in light of the circumstances under which they were
      made, not misleading. 

     

    (z) No
      Integrated Offering.
      Assuming
      the accuracy of the Purchasers’ representations and warranties set forth in
      Section 3.2, neither the Company, nor any of its Affiliates, nor any Person
      acting on its or their behalf has, directly or indirectly, made any offers
      or
      sales of any security or solicited any offers to buy any security, under
      circumstances that would cause this offering of the Subscription Shares to
      be
      integrated with prior offerings by the Company for purposes of the Securities
      Act or any applicable shareholder approval provisions of any Trading Market
      on
      which any of the securities of the Company are listed or designated. 

     

    (aa) Tax
      Status.
      Except
      as set forth on Schedule
      3.1(aa),
      and for
      matters that would not, individually or in the aggregate, have or reasonably
      be
      expected to result in a Material Adverse Effect, the Company and each Subsidiary
      has filed all necessary federal, state and foreign income and franchise tax
      returns and has paid or accrued all taxes shown as due thereon, and the Company
      has no knowledge of a tax deficiency which has been asserted or threatened
      against the Company or any Subsidiary.

     

    (bb) No
      General Solicitation.
      Neither
      the Company nor any person acting on behalf of the Company has offered or sold
      any of the Subscription Shares by any form of general solicitation or general
      advertising. The Company has offered the Subscription Shares for sale only
      to
      the Purchasers and certain other “accredited investors” within the meaning of
      Rule 501 under the Securities Act.

     

    (cc) Acknowledgment
      Regarding Purchasers’ Purchase of Subscription Shares.
      The
      Company acknowledges and agrees that each of the Purchasers is acting solely
      in
      the capacity of an arm’s length purchaser with respect to the Transaction
      Documents and the transactions contemplated thereby. The Company further
      acknowledges that no Purchaser is acting as a financial advisor or fiduciary
      of
      the Company (or in any similar capacity) with respect to the Transaction
      Documents and the transactions contemplated thereby and any advice given by
      any
      Purchaser or any of their respective representatives or agents in connection
      with the Transaction Documents and the transactions contemplated thereby is
      merely incidental to the Purchasers’ purchase of the Subscription Shares. The
      Company further represents to each Purchaser that the Company’s decision to
      enter into this Agreement and the other Transaction Documents has been based
      solely on the independent evaluation of the transactions contemplated hereby
      by
      the Company and its representatives.

     

    3.2 Representations
      and Warranties of the Purchasers.
      Each
      Purchaser hereby, for itself and for no other Purchaser, represents and warrants
      as of the date hereof and as of the Closing Date to the Company as
      follows:

     

    (a) Organization;
      Authority.
      Such
      Purchaser is an entity duly organized, validly existing and in good standing
      under the laws of the jurisdiction of its organization with full right,
      corporate or partnership power and authority to enter into and to consummate
      the
      transactions contemplated by the Transaction Documents and otherwise to carry
      out its obligations hereunder and thereunder. The execution, delivery and
      performance by such Purchaser of the transactions contemplated by this Agreement
      have been duly authorized by all necessary corporate or similar action on the
      part of such Purchaser. Each Transaction Document to which it is a party has
      been duly executed by such Purchaser, and when delivered by such Purchaser
      in
      accordance with the terms hereof, will constitute the valid and legally binding
      obligation of such Purchaser, enforceable against it in accordance with its
      terms, except (i) as limited by general equitable principles and applicable
      bankruptcy, insolvency, reorganization, moratorium and other laws of general
      application affecting enforcement of creditors’ rights generally, (ii) as
      limited by laws relating to the availability of specific performance, injunctive
      relief or other equitable remedies and (iii) insofar as indemnification and
      contribution provisions may be limited by applicable law.

    

    
      
        
          
          

        

        
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    (b) Own
      Account.
      Such
      Purchaser understands that the Subscription Shares are “restricted securities”
and have not been registered under the Securities Act or any applicable state
      securities law and is acquiring the Subscription Shares as principal for its
      own
      account and not with a view to or for distributing or reselling such
      Subscription Shares or any part thereof in violation of the Securities Act
      or
      any applicable state securities law, has no present intention of distributing
      any of such Subscription Shares in violation of the Securities Act or any
      applicable state securities law and has no direct or indirect arrangement or
      understandings with any other persons to distribute or regarding the
      distribution of such Subscription Shares (this representation and warranty
      not
      limiting such Purchaser’s right to sell the Subscription Shares pursuant to the
      Registration Statement or otherwise in compliance with applicable federal and
      state securities laws) in violation of the Securities Act or any applicable
      state securities law. Such Purchaser is acquiring the Subscription Shares
      hereunder in the ordinary course of its business.

     

    (c) Purchaser
      Status.
      At the
      time such Purchaser was offered the Subscription Shares, it was, and at the
      date
      hereof it is, an “accredited investor” as defined in Rule 501(a)(1), (a)(2),
      (a)(3), (a)(7) or (a)(8) under the Securities Act. Such Purchaser is not
      required to be registered as a broker-dealer under Section 15 of the Exchange
      Act. 

     

    (d) Experience
      of Such Purchaser.
      Such
      Purchaser, either alone or together with its representatives, has such
      knowledge, sophistication and experience in business and financial matters
      so as
      to be capable of evaluating the merits and risks of the prospective investment
      in the Subscription Shares, and has so evaluated the merits and risks of such
      investment. Such Purchaser is able to bear the economic risk of an investment
      in
      the Subscription Shares and, at the present time, is able to afford a complete
      loss of such investment.

     

    (e) General
      Solicitation.
      Such
      Purchaser is not purchasing the Subscription Shares as a result of any
      advertisement, article, notice or other communication regarding the Subscription
      Shares published in any newspaper, magazine or similar media or broadcast over
      television or radio or presented at any seminar or any other general
      solicitation or general advertisement.

     

    (f) Short
      Sales and Confidentiality Prior To The Date Hereof.
      Other
      than the transaction contemplated hereunder or under the Note Purchase
      Agreement, such Purchaser has not directly or indirectly, nor has any Person
      acting on behalf of or pursuant to any understanding with such Purchaser,
      engaged in any transaction, including Short Sales, in the securities of the
      Company since March 15, 2006 (“Discussion
      Date”).
      Notwithstanding the foregoing, in the case of a Purchaser that is a
      multi-managed investment vehicle whereby separate portfolio managers manage
      separate portions of such Purchaser's assets and the portfolio managers have
      no
      direct knowledge of the investment decisions made by the portfolio managers
      managing other portions of such Purchaser's assets, the representation set
      forth
      above shall only apply with respect to the portion of assets managed by the
      portfolio manager that made the investment decision to purchase the Subscription
      Shares covered by this Agreement. Other than to other Persons party to this
      Agreement, such Purchaser has maintained the confidentiality of all disclosures
      made to it in connection with this transaction (including the existence and
      terms of this transaction).

    

    
      
        
          
          

        

        
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    (g) Access
      to Information.
      Such
      Purchaser acknowledges that it has received and had the opportunity to review
      (i) copies of the SEC Reports, and (ii) the terms of the Note Purchase Agreement
      and Securities Put Agreement, and all exhibits thereto. Such Purchaser further
      acknowledges that it or its representatives have been afforded (iii) the
      opportunity to ask such questions as it has deemed necessary of, and to receive
      answers from, representatives of the Company concerning the terms and conditions
      of the offering of the Subscription Shares, the merits and risks of investing
      in
      the Subscription Shares, and the terms of the Note Purchase Agreement and
      Securities Put Agreement; (iv) access to information about the Company and
      the
      Company's financial condition, results of operations, business, properties,
      management and prospects sufficient to enable it to evaluate its investment
      in
      the Subscription Shares; and (v) the opportunity to obtain such additional
      information which the Company possesses or can acquire without unreasonable
      effort or expense that is necessary to verify the accuracy and completeness
      of
      the information contained in the SEC Reports.

     

    (h) Restrictions
      on Subscription Shares.
      Such
      Purchaser understands that the Subscription Shares have not been registered
      under the Securities Act and may not be offered, resold, pledged or otherwise
      transferred except (a) pursuant to an exemption from registration under the
      Securities Act or pursuant to an effective registration statement in compliance
      with Section 5 under the Securities Act, (b) in accordance with all applicable
      securities laws of the states of the United States and other jurisdictions
      and
      (c) the lock-up provisions of Section 4.1(b) below.

     

    ARTICLE
      IV.

     

    OTHER
      AGREEMENTS OF THE PARTIES

     

    4.1 Transfer
      Restrictions. The
      Subscription Shares may only be disposed of in compliance with state and federal
      securities laws. In connection with any transfer of Subscription Shares other
      than pursuant to an effective registration statement or Rule 144, the Company
      may require the transferor thereof to provide to the Company an opinion of
      counsel to the Company, the form and substance of which opinion shall be
      reasonably satisfactory to the Company, to the effect that such transfer does
      not require registration of such transferred Subscription Shares under the
      Securities Act. 

     

    (b) In
      addition to transfer restrictions under the Securities Act, the Purchasers
      agree
      that any Subscription Shares purchased hereunder shall be subject to a lock-up
      for a period of six months from the date of issuance and during such period
      shall not be sold, assigned or otherwise disposed of by Purchasers except to
      a
      Permitted Transferee (as defined below) in accordance with subpart (d) below.
      

     

    (c) The
      Purchasers agree to the imprinting, so long as is required by this Section
      4.1,
      of a legend on any of the Subscription Shares in the following
      form:

    

    
      
        
          
          

        

        
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    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. IN ADDITION, THESE SECURITIES ARE SUBJECT
      TO A CONTRACTUAL LOCK-UP THE TERMS OF WHICH ARE SET FORTH IN AN AMENDED AND
      RESTATED SECURITIES PUT AGREEMENT DATED MAY 1, 2006 A COPY OF WHICH IS ON FILE
      WITH THE COMPANY. 

     

    (d) Notwithstanding
      the foregoing, any holder of Subscription Shares may transfer such securities
      to
      any Permitted Transferee who consents in a writing delivered to the Company
      to
      be bound by the applicable terms of this Agreement, subject to the Company’s
      reasonable determination that such transfer does not require registration of
      such transferred securities under the Securities Act.. With respect to any
      such
      holder, a “Permitted Transferee” means the spouse or lineal descendants of such
      holder, any trust for the benefit of such holder or the benefit of the spouse
      or
      lineal descendants of such holder, any corporation or partnership in which
      such
      holder, the spouse and the lineal descendants of such holder are the direct
      and
      beneficial owners of substantially all of the equity interests (provided such
      holder, spouse and lineal descendants agree in writing to remain the direct
      and
      beneficial owners of all such equity interests), the personal representative
      of
      such holder upon such holder’s death for purposes of administration of such
      holder’s estate or upon such holder’s incompetency for purposes of the
      protection and management of the assets of such holder; or for any holder that
      is a partnership, limited liability company, corporation or other entity to
      (i)
      a partner or former partner of such partnership, a member or former member
      of
      such limited liability company or a shareholder of such corporation, (ii) the
      estate of any such partner, member or shareholder, or (iii) any other Affiliate
      of such holder; or for any Purchaser, to another Purchaser or an Affiliate
      of a
      Purchaser.

     

    4.2 Furnishing
      of Information.
      As long
      as any Purchaser owns Subscription Shares, the Company covenants to timely
      file
      (or obtain extensions in respect thereof and file within the applicable grace
      period) all reports required to be filed by the Company after the date hereof
      pursuant to the Exchange Act. As long as any Purchaser owns Subscription Shares,
      if the Company is not required to file reports pursuant to the Exchange Act,
      it
      will prepare and furnish to the Purchasers and make publicly available in
      accordance with Rule 144(c) such information as is required for the Purchasers
      to sell the Subscription Shares under Rule 144. The Company further covenants
      that it will take such further action as any holder of Subscription Shares
      may
      reasonably request, to the extent required from time to time to enable such
      Person to sell such Subscription Shares without registration under the
      Securities Act within the requirements of the exemption provided by Rule
      144.

    

    
      
        
          
          

        

        
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    4.3 Integration.
      The
      Company shall not sell, offer for sale or solicit offers to buy or otherwise
      negotiate in respect of any security (as defined in Section 2 of the Securities
      Act) that would be integrated with the offer or sale of the Subscription Shares
      in a manner that would require the registration under the Securities Act of
      the
      sale of the Subscription Shares to the Purchasers or that would be integrated
      with the offer or sale of the Subscription Shares for purposes of the rules
      and
      regulations of any Trading Market such that it would require shareholder
      approval prior to the closing of such other transaction unless shareholder
      approval is obtained before the closing of such subsequent
      transaction.

     

    4.4 Securities
      Laws Disclosure; Publicity. The Company shall, within one Trading Day of the
      Closing Date, issue a press release disclosing the material terms of the
      transactions contemplated hereby, and shall file a Current Report on Form 8-K
      which shall attach the Transaction Documents thereto by the fourth Business
      Day
      following the Closing Date. The press release and Form 8-K shall be acceptable
      to the Purchasers in their reasonable discretion. No Purchaser shall issue
      any
      such press release or otherwise make any such public statement without the
      prior
      consent of the Company. The Company shall not publicly disclose the name of
      any
      Purchaser, or include the name of any Purchaser in any filing with the
      Commission or any regulatory agency or Trading Market, without the prior written
      consent of such Purchaser, except (i) as required by federal securities law
      in
      connection with (A) any registration statement contemplated by the Registration
      Rights Agreement and (B) the filing of final Transaction Documents (including
      signature pages thereto) with the Commission and (ii) to the extent such
      disclosure is required by law or Trading Market regulations, in which case
      the
      Company shall provide the Purchasers with prior notice of such disclosure
      permitted under this subclause (ii).

     

    4.5 Use
      of
      Proceeds. The Company shall use the net proceeds from the sale of the
      Subscription Shares hereunder as set forth on Schedule 4.5 of the Disclosure
      Schedule. 

     

    4.6 Listing
      of Common Stock. The
      Company hereby agrees to use best efforts to maintain the listing of the Common
      Stock on a Trading Market, and as soon as reasonably practicable following
      the
      Closing to list all of the Subscription Shares on such Trading Market. The
      Company further agrees, if the Company applies to have the Common Stock traded
      on any other Trading Market, it will include in such application all of the
      Subscription Shares, and will take such other action as is necessary to cause
      all of the Subscription Shares to be listed on such other Trading Market as
      promptly as possible. The Company will take all action reasonably necessary
      to
      continue the listing and trading of its Common Stock on a Trading Market and
      will comply in all respects with the Company’s reporting, filing and other
      obligations under the bylaws or rules of the Trading Market. The Company shall
      file a Proxy Statement on Schedule 14A under the Exchange Act with the
      Commission within 20 calendar days of the date hereof, setting forth all
      information required with respect to the transactions contemplated hereby for
      the purpose of obtaining Shareholder Approval, and shall pursue such Proxy
      Statement through any Commission review, and shall cause such Proxy Statement
      to
      be mailed to its shareholders as required by the Exchange Act within 5 calendar
      days of the completion of the Commission’s review, if any, and, to hold a
      special meeting of its shareholders as soon as possible following its mailing.
      The Company shall use all reasonable efforts to obtain such Shareholder
      Approval.

    

    
      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

    

     

    4.7 Short
      Sales and Confidentiality After The Date Hereof. Each
      Purchaser, severally and not jointly with the other Purchasers, covenants that
      neither it nor any Affiliate acting on its behalf or pursuant to any
      understanding with it will engage in any transactions, including any Short
      Sales, in the securities of the Company during the period commencing at the
      Discussion Time and ending at the time that the transactions contemplated by
      this Agreement are first publicly announced as described
      in
      Section 4.4. Each
      Purchaser, severally and not jointly with the other Purchasers, covenants that
      neither it nor any Affiliate acting on its behalf or pursuant to any
      understanding with it will engage in any Short Sales in the securities of the
      Company during the period commencing at the Discussion Time and ending on the
      Effective Date (“Black-out Termination Date”). Each
      Purchaser, severally and not jointly with the other Purchasers, covenants that
      until such time as the transactions contemplated by this Agreement are publicly
      disclosed by the Company as described in Section 4.4, such Purchaser will
      maintain the confidentiality of all disclosures made to it in connection with
      this transaction (including the existence and terms of this transaction). Each
      Purchaser understands and acknowledges, severally and not jointly with any
      other
      Purchaser, that the Commission currently takes the position that coverage of
      short sales of shares of the Common Stock “against the box” prior to the
      Effective Date of the Registration Statement with the Subscription Shares is
      a
      violation of Section 5 of the Securities Act, as set forth in Item 65, Section
      A, of the Manual of Publicly Available Telephone Interpretations, dated July
      1997, compiled by the Office of Chief Counsel, Division of Corporation Finance.
      Notwithstanding
      the foregoing, no Purchaser makes any representation, warranty or covenant
      hereby that it will not engage in Short Sales in the securities of the Company
      after the Black-out Termination Date. Notwithstanding
      the foregoing, in the case of a Purchaser that is a multi-managed investment
      vehicle whereby separate portfolio managers manage separate portions of such
      Purchaser's assets and the portfolio managers have no direct knowledge of the
      investment decisions made by the portfolio managers managing other portions
      of
      such Purchaser's assets, the covenant set forth above shall only apply with
      respect to the portion of assets managed by the portfolio manager that made
      the
      investment decision to purchase the Subscription Shares covered by this
      Agreement.

     

    4.8 Delivery
      of Subscription Shares After Closing. The Company shall deliver, or cause to
      be delivered, the respective Subscription Shares purchased by each Purchaser
      to
      such Purchaser within 3 Trading Days of the Closing Date.

     

    4.9 Form
      D; Blue Sky Filings. The Company agrees to timely file a Form D with respect
      to the Subscription Shares as required under Regulation D and to provide a
      copy
      thereof, promptly upon request of any Purchaser. The Company shall take such
      action as the Company shall reasonably determine is necessary in order to obtain
      an exemption for, or to qualify the Subscription Shares for, sale to the
      Purchasers at the Closing under applicable securities or “Blue Sky” laws of the
      states of the United States, and shall provide evidence of such actions promptly
      upon request of any Purchaser.

    

    
      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

    

     

    ARTICLE
      V.

     

    MISCELLANEOUS

     

    5.1 Fees
      and Expenses. Except as expressly set forth in the Transaction Documents to
      the contrary, each party shall pay the fees and expenses of its advisers,
      counsel, accountants and other experts, if any, and all other expenses incurred
      by such party incident to the negotiation, preparation, execution, delivery
      and
      performance of this Agreement; provided that the Company shall, following each
      Closing, reimburse the reasonable legal fees and expenses of counsel for the
      Purchasers not to exceed $25,000 for all transactions contemplated by this
      Agreement. The Company shall pay all transfer agent fees, stamp taxes and other
      taxes and duties levied in connection with the delivery of any Subscription
      Shares to the Purchasers.

     

    5.2 Entire
      Agreement. The Transaction Documents, together with the exhibits and
      schedules thereto, contain the entire understanding of the parties with respect
      to the subject matter hereof and supersede all prior agreements and
      understandings, oral or written, with respect to such matters, including
      specifically the Original Agreement, which the parties acknowledge have been
      merged into such documents, exhibits and schedules.

     

    5.3 Notices.
      Any and all notices or other communications or deliveries required or permitted
      to be provided hereunder shall be in writing and shall be deemed given and
      effective on the earliest of (a) the date of transmission, if such notice or
      communication is delivered via facsimile at the facsimile number set forth
      on
      the signature pages attached hereto prior to 5:30 p.m. (New York City time)
      on a
      Trading Day, (b) the next Trading Day after the date of transmission, if such
      notice or communication is delivered via facsimile at the facsimile number
      set
      forth on the signature pages attached hereto on a day that is not a Trading
      Day
      or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the
      2nd
      Trading
      Day following the date of mailing, if sent by U.S. nationally recognized
      overnight courier service, or (d) upon actual receipt by the party to whom
      such
      notice is required to be given. The address for such notices and communications
      shall be as follows:

    

    
      	
              If
                to the Company:

            	
              VendingData
                Corporation

            
	 	
              6830
                Spencer Street

            
	 	
              Las
                Vegas, NV 89119

            
	 	
              Facsimile:
                702-617-4737

            
	 	
              Attn:
                Mark R. Newburg, President

            
	 	
              Chief
                Executive Officer

            
	 	 
	
              If
                to the Purchasers:

            	
              c/o
                Bricoleur Capital Management, LLC

            
	 	
              12230
                El Camino Real, Suite 100

            
	 	
              San
                Diego, CA 92130

            
	 	
              Facsimile:
                858-523-2010

            
	 	
              Attn:
                Robert Poole

            

    

     

    
      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

    

    

    or
      such
      other address as either party may provide to the other in writing. 

    

    5.4 Amendments;
      Waivers. No provision of this Agreement may be waived or amended except in a
      written instrument signed, in the case of an amendment, by the Company and
      the
      Purchasers representing not less than 51% of the Subscription Commitment Amount
      then remaining or, in the case of a waiver, by the party against whom
      enforcement of any such waived provision is sought. No waiver of any default
      with respect to any provision, condition or requirement of this Agreement shall
      be deemed to be a continuing waiver in the future or a waiver of any subsequent
      default or a waiver of any other provision, condition or requirement hereof,
      nor
      shall any delay or omission of any party to exercise any right hereunder in
      any
      manner impair the exercise of any such right.

     

    5.5 Headings.
      The headings herein are for convenience only, do not constitute a part of this
      Agreement and shall not be deemed to limit or affect any of the provisions
      hereof.

     

    5.6 Successors
      and Assigns. This Agreement shall be binding upon and inure to the benefit
      of the parties and their successors and permitted assigns. Neither the Company
      nor any Purchasers may assign this Agreement or any rights or obligations
      hereunder without the prior written consent of each the other party (other
      than
      by merger), except that any Purchaser may assign its rights and obligations
      hereunder to a Permitted Transferee in accordance with Section 4.1(d).

     

    5.7 No
      Third-Party Beneficiaries. This Agreement is intended for the benefit of the
      parties hereto and their respective successors and permitted assigns and is
      not
      for the benefit of, nor may any provision hereof be enforced by, any other
      Person.

     

    5.8 Governing
      Law. All questions concerning the construction, validity, enforcement and
      interpretation of the Transaction Documents shall be governed by and construed
      and enforced in accordance with the internal laws of the State of California,
      without regard to the principles of conflicts of law thereof. Each party agrees
      that all legal proceedings concerning the interpretations, enforcement and
      defense of the transactions contemplated by this Agreement and any other
      Transaction Documents (whether brought against a party hereto or its respective
      affiliates, directors, officers, shareholders, employees or agents) shall be
      commenced exclusively in the state and federal courts sitting in the San Diego,
      California. The parties hereby waive all rights to a trial by jury. If either
      party shall commence an action or proceeding to enforce any provisions of the
      Transaction Documents, then the prevailing party in such action or proceeding
      shall be reimbursed by the other party for its reasonable attorneys’ fees and
      other costs and expenses incurred with the investigation, preparation and
      prosecution of such action or proceeding.

     

    5.9 Survival.
      The representations and warranties contained herein shall survive the Closing
      and the delivery of the Subscription Shares.

    

    
      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

    

     

    5.10 Execution.
      This Agreement may be executed in two or more counterparts, all of which when
      taken together shall be considered one and the same agreement and shall become
      effective when counterparts have been signed by each party and delivered to
      the
      other party, it being understood that both parties need not sign the same
      counterpart. In the event that any signature is delivered by facsimile
      transmission or by e-mail delivery of a “.pdf” format data file, such signature
      shall create a valid and binding obligation of the party executing (or on whose
      behalf such signature is executed) with the same force and effect as if such
      facsimile or “.pdf” signature page were an original thereof.

     

    5.11 Severability.
      If any term, provision, covenant or restriction of this Agreement is held by
      a
      court of competent jurisdiction to be invalid, illegal, void or unenforceable,
      the remainder of the terms, provisions, covenants and restrictions set forth
      herein shall remain in full force and effect and shall in no way be affected,
      impaired or invalidated, and the parties hereto shall use their commercially
      reasonable efforts to find and employ an alternative means to achieve the same
      or substantially the same result as that contemplated by such term, provision,
      covenant or restriction. It is hereby stipulated and declared to be the
      intention of the parties that they would have executed the remaining terms,
      provisions, covenants and restrictions without including any of such that may
      be
      hereafter declared invalid, illegal, void or unenforceable.

     

    5.12 Rescission
      and Withdrawal Right. Notwithstanding anything to the contrary contained in
      (and without limiting any similar provisions of) any of the other Transaction
      Documents, whenever any Purchaser exercises a right, election, demand or option
      under a Transaction Document and the Company does not timely perform its related
      obligations within the periods therein provided, then such Purchaser may rescind
      or withdraw, in its sole discretion from time to time upon written notice to
      the
      Company, any relevant notice, demand or election in whole or in part without
      prejudice to its future actions and rights.

     

    5.13 Replacement
      of Subscription Shares. If any certificate or instrument evidencing any
      Subscription Shares is mutilated, lost, stolen or destroyed, the Company shall
      issue or cause to be issued in exchange and substitution for and upon
      cancellation thereof (in the case of mutilation), or in lieu of and substitution
      therefor, a new certificate or instrument, but only upon receipt of evidence
      reasonably satisfactory to the Company of such loss, theft or destruction.
      The
      applicant for a new certificate or instrument under such circumstances shall
      also pay any reasonable third-party costs (including customary indemnity)
      associated with the issuance of such replacement Subscription
      Shares.

     

    5.14 Independent
      Nature of Purchasers’ Obligations and Rights. The obligations of each
      Purchaser under any Transaction Document are several and not joint with the
      obligations of any other Purchaser, and no Purchaser shall be responsible in
      any
      way for the performance or non-performance of the obligations of any other
      Purchaser under any Transaction Document. Nothing contained herein or in any
      other Transaction Document, and no action taken by any Purchaser pursuant
      thereto, shall be deemed to constitute the Purchasers as a partnership, an
      association, a joint venture or any other kind of entity, or create a
      presumption that the Purchasers are in any way acting in concert or as a group
      with respect to such obligations or the transactions contemplated by the
      Transaction Documents. Each Purchaser shall be entitled to independently protect
      and enforce its rights, including without limitation, the rights arising out
      of
      this Agreement or out of the other Transaction Documents, and it shall not
      be
      necessary for any other Purchaser to be joined as an additional party in any
      proceeding for such purpose. The Company has elected to provide all Purchasers
      with the same terms and Transaction Documents for the convenience of the Company
      and not because it was required or requested to do so by the
      Purchasers.

    

    
      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

    

     

    5.15 Construction.
      The parties agree that each of them and/or their respective counsel has reviewed
      and had an opportunity to revise the Transaction Documents and, therefore,
      the
      normal rule of construction to the effect that any ambiguities are to be
      resolved against the drafting party shall not be employed in the interpretation
      of the Transaction Documents or any amendments hereto.

     

    (SIGNATURE
      PAGES FOLLOW)

    

    
      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

    

    

    IN
      WITNESS WHEREOF, the parties hereto have caused this Securities Put Agreement
      to
      be duly executed by their respective authorized signatories as of the date
      first
      indicated above.

     

     

    VENDINGDATA
      CORPORATION

    

    

    By:        
       /s/
      Mark R.
      Newburg                             

                   
      Mark R. Newburg,

    President
      and Chief Executive Officer

    

    [REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    SIGNATURE
      PAGE FOR PURCHASERS FOLLOWS]

    

    
      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      

    

     

    

      BRICOLEUR
        PARTNERS, L.P.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        General Partner

      

      By: /s/
        Robert Poole   

      Robert
        Poole, Member of 

      Management
        Board

      

      Subscription
        Commitment Amount: $715,000

      

      

      BRICOLEUR
        ENHANCED, L.P.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        General Partner

      

      By: /s/
        Robert Poole   

      Robert
        Poole, Member of 

      Management
        Board

      

      Subscription
        Commitment Amount: $1,785,000

      

      BRIC
        6, L.P.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        General Partner

      

      By: /s/
        Robert Poole   

      Robert
        Poole, Member of 

      Management
        Board

      

      Subscription
        Commitment Amount: $715,000

      

      

      BRICOLEUR
        OFFSHORE LTD.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        Investment Adviser

      

      By: /s/
        Robert Poole   

      Robert
        Poole, Member of

      Management
        Board

      

      Subscription
        Commitment Amount: $1,785,000

    

     

    

    
      
        
          
          

        

        
          25Exhibit
        10.3

    

    
       

       

      SECURITY
        AGREEMENT

       

       

      This
        Security Agreement (“Agreement”)
        is
        entered into effective as of May 1, 2006 by and among VendingData Corporation,
        a
        Nevada corporation (“Grantor”),
        and
        each of 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 (i) an 8% Senior Secured Note
        Purchase Agreement of even date herewith (the “Note
        Purchase Agreement”)
        under
        which the Grantor has issued certain 8% Senior Secured Promissory Notes (
        each
        an “8% Note”)
        of
        even date in favor of the Secured Parties in the aggregate original principal
        amount of $13,000,000, and (ii) a Letter Agreement dated May 2, 2006 (the
        “Letter
        Agreement”)
        pursuant to which the Grantor has issued Convertible Promissory Notes (
        collectively with the 8% Notes, the “Notes”)
        of
        even date in favor of the Secured Parties in the aggregate principal amount
        of
        $1,500,000.

      

       

      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;

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      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, the Note Purchase
        Agreement or the Letter Agreement.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      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.
        

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      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;

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      (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. 

       

      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

          
            

          

        

        
          
          

        

      

       

      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. 

       

       

      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

          
            

          

        

        
          
          

        

      

       

      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);

       

       

      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

          
            

          

        

        
          
          

        

      

       

      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.

       

      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

          
            

          

        

        
          
          

        

      

       

      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.

       

       

      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.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

       

      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.

       

       

      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.

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

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

       

       

      VENDINGDATA
        CORPORATION 

      

       

      By: /s/
        Mark R. Newburg   

          
Mark
        R.
        Newburg, 

            
President
        and Chief Executive Officer

      

       

      BRICOLEUR
        PARTNERS, L.P.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        General Partner

      

      By: /s/
        Robert
        Poole                      
   

           
Robert
        Poole, Member of  

             
        Management Board

      

      BRICOLEUR
        ENHANCED, L.P.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        General Partner

       

      By: /s/
        Robert
        Poole                   
   

           Robert
        Poole, Member of 

            
Management
        Board

      

      BRIC
        6, L.P.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        General Partner

      

      By: /s/
        Robert
        Poole                    

           
Robert
        Poole, Member of 

             
Management
        Board

      

      BRICOLEUR
        OFFSHORE LTD.

      

      By:
        Bricoleur Capital Management, LLC,

      Its
        Investment Adviser

      

      By: /s/
        Robert
        Poole                 
   

           
Robert
        Poole, Member of

              Management
        Board

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      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

       

      

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      Exhibit
        B

       

       

      Permitted
        Liens

       

      
        
          
          

        

        
          13

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