Document:

EXHIBIT
      10.9

     

    

     

    REGISTRATION
      RIGHTS AGREEMENT

     

    THIS
      REGISTRATION RIGHTS AGREEMENT (the “Agreement”)
      is
      made and entered into effective as of the 11th day of July 2006 by and among
      VendingData Corporation, a Nevada corporation (the “Company”),
      William Westmore Purton (“Purton”)
      and
      Synwood Pty Ltd ACN 005 506 150 (“Synwood”).

     

    For
      good
      and valuable consideration, the receipt and adequacy of which are hereby
      acknowledged, the Company, Purton and Synwood hereby agree as
      follows.

     

    1.            
      Definitions.

     

    As
      used
      in this Agreement, the following terms, not previously defined, will have the
      meanings as set forth herein:

     

    1.1 “Commission”
means
      the United States Securities and Exchange Commission, and any successor thereto.
      

     

    1.2 “Common
      Stock”
means
      the Company’s Common Stock, $.001 par value.

     

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

     

    1.4 “Holder”
means
      Purton, Synwood, each assignee of Purton’s or Synwood’s rights hereunder in
      accordance with Section 8.9 of this Agreement, and the holder of a Note (as
      that
      expression is defined in a Share Sale Agreement) at the time (if any) that
      the
      principal amount of that Note converts into shares of Common Stock.

     

    1.5 “Person”
means
      an individual, partnership, limited partnership, corporation, business trust,
      limited liability company, an association, joint stock company, a trust,
      unincorporated organization, joint venture or other entity of whatever nature.
      

     

    1.6 “Registrable
      Common”
means
      any shares of Common Stock issued to the Holders or issuable to the Holders
      pursuant to a Share Sale Agreement, including any shares of Common Stock issued
      upon conversion of the principal amount of a Note or as a dividend, stock split,
      reclassification, recapitalization or other distribution with respect to or
      in
      exchange for replacement of any such shares of Common Stock; provided,
      however,
      that
      Registrable Common will not include any shares, the sale of which has been
      registered pursuant to the Securities Act or which have been or could be sold
      to
      the public pursuant to Rule 144 promulgated by the Commission under the
      Securities Act without restriction under the volume limitations of Rule
      144.

     

    1.7 “Register,”
      “registered”
and
      “registration”
refer
      to a registration effected by preparing and filing a registration statement
      in
      compliance with the Securities Act and the declaration or ordering of the
      effectiveness of such Registration Statement.

     

    1.8 “Securities
      Act”
means
      the Securities Act of 1933, as amended, and the rules and regulations
      promulgated from time to time thereunder.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    1.9 “Share
      Sale Agreement”
means
      the Share Sale Agreement of even date herewith between the Company, Purton
      and
      Synwood whereby the Company has agreed to issue to Purton and Synwood an
      aggregate of up to 4,114,286 shares of Common Stock.

    

    2.             Registration
      Rights.

     

    2.1. Subject
      to the limitations and requirements set forth in this Section 2, the Company
      will use commercially reasonable efforts to prepare and file a registration
      statement under the Securities Act, on the appropriate form covering resale
      of
      the Registrable Common on or before the later of (i) August 11, 2006, or (ii)
      the fifth business day following Purton’s and Synwood’s delivery of the
      consolidated financial statements of Dolphin Advanced Technologies Pty Limited
      ACN 007 081 996 in accordance with clause 9.1(a) of the Share Sale Agreement,
      and will use commercially reasonable efforts to cause such registration
      statement to become effective as soon as is practicable after such filing.
      

     

    2.2. If
      the
      Company furnishes to such Holders a certificate signed by the Chief Executive
      Officer of the Company stating that in the good faith judgment of the Board
      of
      Directors of the Company it would be seriously detrimental to the Company and
      its stockholders for such registration statement to be filed at such time,
      then
      the Company will have the right to defer such filing for a period ending not
      later than thirty (30) days from the latest filing date of such offering as
      required herein.

     

    2.3 The
      Company represents and warrants that it has not, and agrees that it will not,
      enter into any agreement with respect to any of its securities which will grant
      to any Person piggyback rights with respect to any registration statement filed
      pursuant to Section 2.1 of this Agreement. 

     

    3.            
      Registration
      Procedures.
      When
      the Company is required by the terms of this Agreement to effect the
      registration of Registrable Common under the Securities Act, the Company
      will:

     

    3.1. Filing.
      Prepare
      and file with the Commission a registration statement with respect to such
      securities on a form that is available for the sale of the Registrable Common
      in
      accordance with the intended methods of distribution thereof, and use
      commercially reasonable efforts to cause such registration statement to become
      and remain effective for such period as may be reasonably necessary to effect
      the sale of such securities, but not to exceed the lesser of (i) two years
      from
      the date of the effectiveness of such registration statement, (ii) until the
      distribution described in the registration statement has been completed or
      (iii)
      such time as the securities may be sold to the public pursuant to Rule 144
      promulgated by the Commission under the Securities Act without restriction
      under
      the volume limitations of Rule 144. If the registration statement refers to
      any
      Holder by name or otherwise as the holder of the Registrable Common, the Company
      must furnish to that Holder and its counsel, as promptly as practicable but
      in
      any event by no later than three business days before filing the registration
      statement with the SEC, copies of all documents proposed to be filed as part
      of
      or accompanying the registration statement, which documents will be subject
      to
      the review of the Holder’s counsel.

     

    3.2. Period
      of Effectiveness.
      Prepare
      and file with the Commission such amendments to such registration statement
      and
      supplements to the prospectus contained therein as may be necessary to keep
      such
      registration statement effective for the period described in Section
      3.1.

     

    3.3. Copies.
      Furnish
      to the Holders participating in such registration and, if applicable, to the
      underwriters of the securities being registered such reasonable number of copies
      of the registration statement, preliminary prospectus, final prospectus and
      such
      other documents as such underwriters may reasonably request in order to
      facilitate the public offering of such securities.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.4. Blue
      Sky.
      Use its
      commercially reasonable efforts to register or qualify the securities covered
      by
      such registration statement under such state securities or blue sky laws of
      such
      jurisdictions within the United States of America as such participating Holder
      may reasonably request in writing within twenty (20) days following the original
      filing of such registration statement, and do any and all other acts and things
      as may be reasonably necessary or advisable to enable the Holders and the
      underwriter, if any, to consummate the disposition in such jurisdictions of
      the
      Registrable Common, except that the Company will not for any purpose be required
      to execute a general consent to service of process or to qualify to do business
      as a foreign corporation or subject itself to taxation in any jurisdiction
      wherein it is not so qualified or taxed.

     

    3.5. Notification.
      Notify
      the Holders participating in such registration, promptly after it receives
      notice thereof, of the time when such registration statement has become
      effective or a supplement to any prospectus forming a part of such registration
      statement has been filed.

     

    3.6. Amendment
      Notice.
      Notify
      the Holders participating in such registration promptly of any request by the
      Commission for the amending or supplementing of such registration statement
      or
      prospectus or for additional information.

     

    3.7. Update.
      Prepare
      and promptly file with the Commission and promptly notify the Holders
      participating in such registration of the filing of such amendment or supplement
      to such registration statement or prospectus as may be necessary to keep such
      registration statement effective for the period referred to in Section 3.1,
      including any such amendment or supplement that is necessary to correct any
      statements or omissions if, at the time when a prospectus relating to such
      securities is required to be delivered under the Securities Act, any event
      has
      occurred as the result of which any such prospectus or any other prospectus
      as
      then in effect would include an untrue statement of a material fact or omit
      to
      state any material fact necessary to make the statements therein, in light
      of
      the circumstances in which they were made, not misleading.

     

    3.8. Stop
      Orders.
      Advise
      the Holders participating in such registration, promptly after it receives
      notice or obtains knowledge thereof, of the issuance of any stop order by the
      Commission suspending the effectiveness of such registration statement or the
      initiation or threatening of any proceeding for that purpose and promptly use
      its best efforts to prevent the issuance of any stop order or to obtain its
      withdrawal if such stop order should be issued.

     

    4.            
      Expenses.
      With
      respect to the registration pursuant to Section 2 hereof (except as otherwise
      provided in such Section) and with respect to each inclusion of Registrable
      Common in a registration statement pursuant to Section 2 hereof (except as
      otherwise provided in such Section), the Company will bear all fees, costs
      and
      expenses incident to the Company’s performance of or compliance with this
      Agreement, including, without limitation: all registration, filing and NASD
      fees, printing expenses, fees and disbursements of counsel and accountants
      for
      the Company, all internal Company expenses, all legal fees and disbursements
      and
      other expenses of complying with state securities or blue sky laws of any
      jurisdictions in which the securities to be offered are to be registered or
      qualified, and the premiums and other costs of policies of insurance against
      liability (if any) arising out of such public offering. Fees and disbursements
      of counsel and accountants for the selling security Holders, underwriting
      discounts and commissions and transfer taxes relating to the shares included
      in
      the offering by the selling security Holders, and any other expenses incurred
      by
      the selling security Holders not included above, will be borne by the selling
      security Holders.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    5.             Cooperation.
      Any
      Holder whose Registrable Common are to be included in a Registration Statement
      filed hereunder agrees to cooperate with all reasonable requests by the Company
      necessary to effectuate the purposes of this Agreement, including by timely
      providing the Company with all information necessary to prepare and file a
      registration statement.

     

    6.            
      Dispositions.
      Each
      Holder agrees that it will comply with the prospectus delivery requirements
      of
      the Securities Act as applicable to it in connection with sales of Registrable
      Common pursuant to the registration statement. Each Holder further agrees that,
      upon receipt of a notice from the Company of the occurrence of any event which
      causes the prospectus made part of the Registration Statement to longer to
      be
      current, complete or accurate in any material respect, such Holder will
      discontinue disposition of such Registrable Common under the registration
      statement until such Holder’s receipt of the copies of the supplemented
      prospectus and/or amended registration statement or until it is advised in
      writing by the Company that the use of the applicable prospectus may be resumed,
      and, in either case, has received copies of any additional or supplemental
      filings that are incorporated or deemed to be incorporated by reference in
      such
      prospectus or Registration Statement. The Company may provide appropriate stop
      orders to enforce the provisions of this paragraph.

     

    7.            
      Indemnification.
      

     

    7.1. Indemnification
      by Company.
      To the
      fullest extent permitted by law, the Company will indemnify and hold harmless
      each Holder which has Registrable Common included in a registration statement
      pursuant to the provisions hereof, its directors and officers, and any
      underwriter (as defined in the Securities Act) for such Holder and each Person,
      if any, who controls such Holder or such underwriter within the meaning of
      the
      Securities Act, from and against, and will reimburse such Holder and each such
      underwriter and controlling Person with respect to, any and all loss, damage
      and
      liability (collectively, “Losses”) to which such Holder or any such underwriter
      or controlling Person may become subject under the Securities Act, state
      securities laws or otherwise, and the Company will pay to each such Holder,
      underwriter or controlling person any legal or other costs or expenses
      reasonably incurred by such person in connection with investigating or defending
      any such Loss, insofar as such Losses arise out of or are based upon any untrue
      statement or alleged untrue statement of any material fact contained in such
      registration statement, any prospectus contained therein or any amendment or
      supplement thereto, or arise out of or are based upon the omission or alleged
      omission to state therein a material fact required to be stated therein or
      necessary to make the statements therein, in light of the circumstances in
      which
      they were made, not misleading; provided, however, that the Company will not
      be
      liable in any such case to the extent that any such Loss arises out of or is
      based upon an untrue statement or alleged untrue statement or omission or
      alleged omission so made in conformity with information furnished by such
      Holder, such underwriter or such controlling Person in writing specifically
      for
      use in the preparation thereof; provided, however, that the indemnity agreement
      in this Section 7.1 will not apply to amounts paid in settlement of any such
      Loss if such settlement is effected without the consent of the Company, which
      consent will not be unreasonably withheld, and that the foregoing indemnity
      obligation with respect to any preliminary prospectus or final prospectus (if
      such final prospectus has been amended or supplemented and such amendments
      or
      supplements have been furnished to such Holder prior to the written confirmation
      of the sale involved) will not inure to the benefit of any Holder on account
      of
      any Loss whatsoever arising from the sale of any Registrable Common by such
      Holder to any person if (A) a copy of the final prospectus (as amended or
      supplemented if such amendments or supplements have been furnished to such
      Holder prior to the written confirmation of the sale involved) has not been
      sent
      or given by or on behalf of such Holder to such person, if required by law,
      with
      or prior to the written confirmation of the sale involved, and (B) the untrue
      statement or alleged untrue statement or omission or alleged omission of a
      material fact contained in such preliminary prospectus or final prospectus
      from
      which such Loss arose was corrected in the final prospectus (as amended or
      supplemented if such amendments or supplements thereto have been furnished
      as
      aforesaid).

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    7.2. Indemnification
      by Holder.
      Each
      Holder which has Registrable Common included in a registration statement
      pursuant to the provisions hereof will severally, but not jointly, indemnify
      and
      hold harmless the Company, its directors and officers, each Person, if any,
      who
      controls the Company within the meaning of the Securities Act, any other Holder
      selling securities pursuant to such registration statement, any controlling
      Person of any such selling Holder, any underwriter and any controlling Person
      of
      any such underwriter (each, an “Indemnitee”) from and against, and will
      reimburse any Indemnitee with respect to, any and all Losses to which such
      Indemnitee may become subject under the Securities Act, state securities laws
      or
      otherwise, and such Holder will pay to each Indemnitee, any legal or other
      costs
      or expenses reasonably incurred by such person in connection with investigating
      or defending any such Loss, insofar as such Losses are caused by any untrue
      or
      alleged untrue statement of any material fact contained in such registration
      statement, any prospectus contained therein or any amendment or supplement
      thereto, or arise out of or are based upon the omission or the alleged omission
      to state therein a material fact required to be stated therein or necessary
      to
      make the statements therein, in light of the circumstances in which they were
      made, not misleading, in each case to the extent, but only to the extent, that
      such untrue statement or alleged untrue statement or omission or alleged
      omission was so made in reliance upon and in conformity with written information
      furnished by such Holder specifically for use in the preparation thereof;
      provided, however, that the indemnity agreement in this Section 7.2 will not
      apply to amounts paid in settlement of any such Loss if such settlement is
      effected without, and that the foregoing indemnity obligation with respect
      to
      any preliminary prospectus or final prospectus (if such final prospectus has
      been amended or supplemented and such amendments or supplements have been
      furnished to such Indemnitee prior to the written confirmation of the sale
      involved) will not inure to the benefit of any Indemnitee on account of any
      Loss
      whatsoever arising from the sale of any Registrable Common by the Holder to
      any
      person if (A) a copy of the final prospectus (as amended or supplemented if
      such
      amendments or supplements have been furnished to such Indemnitee prior to the
      written confirmation of the sale involved) has not been sent or given by or
      on
      behalf of such Indemnitee to such person, if required by law, with or prior
      to
      the written confirmation of the sale involved, and (B) the untrue statement
      or
      alleged untrue statement or omission or alleged omission of a material fact
      contained in such preliminary prospectus or final prospectus from which such
      Loss arose was corrected in the final prospectus (as amended or supplemented
      if
      such amendments or supplements thereto have been furnished as
      aforesaid.

     

    7.3. Indemnification
      Procedures.
      Promptly after receipt by a party entitled to indemnification pursuant to this
      Section (each, an “Indemnified Party”) of notice of the commencement of any
      action involving the subject matter of the foregoing indemnity provisions such
      Indemnified Party will, if a claim is to be made against the party obligated
      to
      provide indemnification pursuant to this section (each, an “Indemnifying
      Party”), promptly notify the Indemnifying Party of the commencement thereof; but
      the omission to provide such notice will not relieve the Indemnifying Party
      from
      any liability hereunder, except to the extent that the delay in giving, or
      failing to give, such notice has a material adverse effect upon the ability
      of
      the Indemnifying Party to defend against the claim. In case such action is
      brought against an Indemnified Party, the Indemnifying Party will have the
      right
      to participate in and, at the Indemnifying Party’s option, to assume the defense
      thereof, singly or jointly with any other Indemnifying Party similarly notified,
      with counsel or reasonably satisfactory to the Indemnified Party; provided,
      however, that if the defendants in any action include both the Indemnified
      Party
      and the Indemnifying Party and the Indemnified Party reasonably concludes that
      there may be legal defenses available to any Indemnified Parties that are
      different from or additional to those available to the Indemnifying Party,
      or if
      there is a conflict of interest which would prevent counsel for the Indemnifying
      Party from also representing the Indemnified Party, the Indemnified Party will
      have the right to select counsel to participate in the defense of such action
      on
      behalf of such Indemnified Party at the expense of the Indemnifying Party;
      provided further, however, that the Indemnifying Party will be responsible
      for
      the expenses of only one such special counsel (and one local counsel if
      necessary for jurisdictional purposes) selected jointly by the Indemnified
      Parties if there is more than one Indemnified Party. After notice from an
      Indemnifying Party to any Indemnified Party of such Indemnifying Party’s
      election to assume the defense or the action, the Indemnifying Party will not
      be
      liable to such Indemnified Party pursuant to this Section 7 for any legal or
      other expense subsequently incurred by such Indemnified Party in connection
      with
      the defense thereof, unless (i) the Indemnified Party has employed counsel
      in
      accordance with the proviso of the preceding sentence, or (ii) the Indemnifying
      Party has not employed counsel satisfactory to the Indemnified Party to
      represent the Indemnified Party within a reasonable time after the notice of
      the
      commencement of the action, or (iii) the Indemnifying Party has authorized
      the
      employment of counsel for the Indemnified Party at the expense of the
      Indemnifying Party.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    8.            
      Miscellaneous.

     

    8.1. Waivers,
      Amendments and Approvals.
      In each
      case in which the approval of the Holder is required by the terms of this
      Agreement, such requirement will be satisfied by a vote or the written action
      of
      Holders of at least a majority of the Registrable Common held by all the
      Holders. Any term or provision of this Agreement requiring performance by or
      binding upon the Company or the Holders may be amended, and the observance
      of
      any term of this Agreement may be waived (either generally or in a particular
      instance and either retroactively or prospectively), by a writing signed by
      the
      Company and the Holders of at least a majority of the Registrable Common held
      by
      all the Holders. Any amendment or waiver effected in accordance with this
      Section will be binding upon all of the Holders (including permitted assigns
      pursuant to Section 8.9 hereof). The waiver by a party of any breach hereof
      or
      default in payment of any amount due hereunder or default in the performance
      hereof will not be deemed to constitute a waiver of any other default or
      succeeding breach or default. Written notice of any such waiver, consent or
      agreement of amendment, modification or supplement will be given to the record
      Holder of Registrable Common who did not give written consent
      thereto.

     

    8.2. Notices.
      All
      notices, requests, consents and other communications required or permitted
      hereunder will be in writing and will be delivered either by (i) personal
      delivery, (ii) registered or certified airmail, postage prepaid or (iii)
      facsimile, to the party’s address set forth in the Share Sale Agreement (or
      transfer documents in the case of permitted assigns pursuant to Section 8.9
      hereof) and such notices and other communications will for all purposes of
      this
      Agreement be treated as being effective or having been given if delivered
      personally, or, if sent by mail or facsimile, when received. Any party may
      change its address for such communications by giving notice thereof to the
      other
      parties in conformity with this Section.

     

    8.3. Entire
      Agreement.
      This
      Agreement, the schedules hereto, the documents referenced herein and the
      exhibits thereto, constitute the entire understanding and agreement of the
      parties hereto with respect to the subject matter hereof and thereof and
      supersede all prior and contemporaneous agreements or understandings,
      inducements or conditions, express or implied, written or oral, between the
      parties with respect hereto and thereto. The express terms hereof control and
      supersede any course of performance or usage of the trade inconsistent with
      any
      of the terms hereof.

     

    8.4. Other
      Remedies.
      Any and
      all remedies herein expressly conferred upon a party will be deemed cumulative
      with, and not exclusive of, any other remedy conferred hereby or by law on
      such
      party, and the exercise of any one remedy will not preclude the exercise of
      any
      other.

     

    8.5. Delays
      or Omissions.
      Except
      as expressly provided herein, no delay or omission to exercise any right, power
      or remedy accruing to any party under this Agreement will impair any such right,
      power or remedy of such party nor will it be construed to be a waiver of any
      such breach or default, or an acquiescence thereto, or of a similar breach
      of
      default thereafter occurring; nor will any waiver of any single breach or
      default be deemed a waiver of any other breach or default theretofore or
      thereafter occurring. Any waiver, permit, consent or approval of any kind or
      character on the part of any party hereto of any breach or default under the
      Agreement, or any waiver on the part of any party of any provisions or
      conditions of this Agreement must be in writing and will be effective only
      to
      the extent specifically set forth in such writing. 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    8.6. Governing
      Law.
      This
      Agreement will be governed by and construed under the laws of the State of
      Nevada, without regard to the conflict of laws principles thereof.

     

    8.7. Counterparts.
      This
      Agreement may be executed concurrently (including facsimile signatures) in
      two
      or more counterparts, each of which will be deemed an original, but all of
      which
      together will constitute one and the same instrument.

     

    8.8. Severability.
      Should
      any one or more of the provisions of this Agreement or of any agreement entered
      into pursuant to this Agreement be determined to be illegal or unenforceable,
      all other provisions of this Agreement and of each other agreement entered
      into
      pursuant to this Agreement, will be given effect separately from the provision
      or provisions determined to be illegal or unenforceable and will not be affected
      thereby.

     

    8.9 Successors
      and Assigns.
      This
      Agreement shall inure to the benefit of and be binding upon the successors
      and
      permitted assigns of each of the parties and shall inure to the benefit of
      each
      Holder. The Company may not assign its rights or obligations hereunder without
      the prior written consent of each Holder. Each Holder may assign its rights
      and
      obligations hereunder in connection with the Holder’s private sale or transfer
      of no less than 500,000 shares of Common Stock to the transferee wishing to
      take
      an assignment of Holder’s rights hereunder; provided that such transferee agrees
      in writing to be bound by the provisions of this Agreement. 

     

    [Signatures
      appear on next page] 

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN
      WITNESS WHEREOF, this Agreement is hereby executed as of the date first written
      above.

     

     

    
      	 	 	 
	 	“Company”
	 	 
	 	VENDINGDATA CORPORATION
	 
 	 
 	 
 
	 	By:  	/s/ Mark
              NewBurg
	 	
              
Mark
              Newburg, Chief Executive
              Officer

    

     

    
      	 	 	 
	 	“Synwood”
	 	 
	 	SYNWOOD PTY LTD ACN 005 506 150
	 
 	 
 	 
 
	 	By:  	/s/ William
              Westmore Purton
	 	
              

            

 

    
      	 	 	 
	 	“Purton”
	 
 	 
 	 
 
	 	By:  	/s/
              William Westmore Purton
	 	
              
William
              Westmore Purton, an
              individualUnassociated Document

    Exhibit
      10.10

     

    

     

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

     

    
      	US$___________	 	
              July
                11,
                2006

            

    

     

     

    CONVERTIBLE
      UNSECURED PROMISSORY NOTE

     

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

     

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

     

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

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

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

     

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

     

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

     

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

     

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

     

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

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

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

     

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

     

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

     

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

     

    
      	
              Maker:

            	 	
              VendingData
                Corporation.

               6830
                Spencer Street

              Las
                Vegas, NV 89119

              Attention:
                Mark R. Newburg, 

              President
                and Chief Executive Officer

              Facsimile:
                (702) 733-7197

            

    

     

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

     

    
      	
              Holder:

            	 	 

    

     

    

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

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

     

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

     

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

    

         

     

    
      
        
        

      

      
        4

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