Document:

Unassociated Document

Exhibit
10.1

 

REPURCHASE
AGREEMENT

 

This
Repurchase Agreement (this
“Agreement”) is made and entered into as of April 8 2005, by and between
VendingData Corporation, a Nevada corporation (the “Company”), Triage Capital
Management LP, a Delaware limited partnership (“Triage Capital”), Triage Capital
Management B LP, a Delaware limited partnership (“Triage Capital B”), Triage
Offshore Fund Ltd., a Cayman Islands exempt company (“Triage Offshore”),
Periscope Partners LP, a Delaware limited Partnership (“Periscope”), and Leonid
Frenkel, an individual (“Frenkel” and, together with Triage Capital, Triage
Capital B, Triage Offshore and Periscope, the “Triage Parties”).

 

R
E C I T A L S

 

Whereas, the
parties to this Agreement (the “Parties”) desire to enter into this Agreement
for the purposes of having the Company repurchase any and all shares of the
Company’s common stock, $.001 par value (“Common Stock”), owned by the Triage
Parties in exchange for a warrant from the Company (the “Repurchase
Transaction”);

 

Now
Therefore, in
consideration of the mutual covenants, promises, representations, understandings
and agreements hereinafter set forth, the Parties hereto agree the recitals set
forth above are true and accurate and are hereby incorporated in and made a part
of this Agreement, and further covenant and agree as follows:

 

 

	1.  	
      Terms
      and Conditions

 

1.1.  Purchase. In
exchange for the repurchase of an aggregate of Four Hundred Forty-Eight Thousand
Fifty-Three (448,053) shares of Common Stock held by the Triage Parties as
follows, the Company shall issue to each Triage Party a warrant to purchase an
equal number of shares of Common Stock with an exercise price of $.01 per
underlying share:

 

1.1.1.  44,444
shares held by Triage Capital;

 

1.1.2.  41,400
shares held by Triage Capital;

 

1.1.3.  20,800
shares held by Triage Capital B;

 

1.1.4.  88,888
shares held by Triage Capital B;

 

1.1.5.  94,800
shares held by Triage Offshore;

 

1.1.6.  122,221
shares held by Triage Offshore;

 

1.1.7.  10,000
shares Periscope; and

 

1.1.8.  25,500
shares held by Frenkel. 

 

1.2.  Effective
Date; Delivery Obligations. The
effective date for the Repurchase Transaction shall be Friday, April 8, 2005.
Each party hereby agrees to deliver the following as part of the Repurchase
Transaction:

 

1.2.1.  Delivery
Obligations of the Triage Parties.

 

 

 

 

1.2.1.1.  Stock
certificate issued to Triage Capital for 44,444 shares of common
stock;

 

1.2.1.2.  Stock
certificate issued to Triage Capital B for 88,888 shares of common
stock;

 

1.2.1.3.  Stock
certificate issued to Triage Offshore for 122,221 shares of common
stock;

 

1.2.1.4.  An
irrevocable stock or bond power for the Repurchased Shares in form and substance
reasonably acceptable to the Company and its counsel consistent with Section
1.3.1; and

 

1.2.1.5.  Such
other and further documents and instruments that may be reasonably required by
the Company to complete and facilitate the rescission in accordance with this
Agreement 

 

1.2.2.  Delivery
Obligations of the Company.

 

1.2.2.1.  Warrant
issued in the name of Triage Capital for 85,844 shares of Common
Stock;

 

1.2.2.2.  Warrant
issued in the name of Triage Capital B for 109,688 shares of Common
Stock;

 

1.2.2.3.  Warrant
issued in the name of Triage Offshore for 217,021 shares of Common
Stock;

 

1.2.2.4.  Warrant
issued in the name of Periscope for 10,000 shares of Common Stock;
and

 

1.2.2.5.  Warrant
issued in the name of Frenkel for 25,500 shares of Common Stock. 

 

1.3.  Treasury
Shares. Upon
the closing of the Repurchase Transaction, the Company shall hold the
Repurchased Shares as treasury shares to be re-issued to the Triage Parties,
when and if the Warrants are exercised by the Triage Parties.

 

1.4.  Form
of Warrant. The
warrants to be issued by the Company pursuant to this Agreement shall be in the
form attached hereto as Exhibit
A and, as
provided in the form of warrant, shall may not be exercisable until after April
8, 2006 and until the Triage Parties or their respective affiliated parties are
in compliance with the registration requirements of the Investment Advisor Act
of 1940, as amended; provided, however, subject to certain limitations related
to voting rights, the Triage Parties may be permitted to exercise the warrants
at any time upon a “change of control” involving the Company, as defined in the
form of warrant.

 

 

	2.  	
      Representations,
      Warranties and Covenants

 

2.1.  General
Representations and Warranties. In
order to induce the other party to enter into this Agreement, each Party to this
Agreement represents and warrants to the other party the following:

 

 

2

 

 

2.1.1.  Authorization;
Binding Effect. Each
party has all of the requisite power and authority to execute and deliver this
Agreement, to the extent applicable, and carry out and perform its obligations
under the terms of this Agreement, if any. To the extent applicable, this
Agreement has been duly authorized, executed and delivered and constitutes the
legal, valid and binding obligation of each party, enforceable in accordance
with its terms. The undersigned representative of each party, to the extent
applicable, is the duly authorized representative of such party and has all
necessary powers and authority to enter into this Agreement on behalf of such
party. 

 

2.1.2.  No
Violation. Neither the execution and delivery of this Agreement, nor the
fulfillment of or compliance with the terms and provisions of this Agreement,
will conflict with, or result in a breach or violation of any of the terms,
conditions or provisions of, or constitute a default under, any governing
document, contract, agreement, mortgage, indenture, lease, instrument, order,
judgment, statute, law, rule or regulation to which each party or any of its
assets is subject, or result in the creation of any security interest, mortgage,
pledge, lien, claim, charge or encumbrance on any properties of such
party.

 

2.1.3.  No
Consent. No consent, approval, order or authorization of, or registration,
declaration or filing with, any court, administrative agency or commission or
other governmental authority or instrumentality, domestic or foreign, or any
non-governmental third party is required by, or with respect to, each party in
connection with the execution and delivery of this Agreement by such party, the
performance by such party of its obligations hereunder or the consummation by
such party of the transactions contemplated by this Agreement. 

 

2.1.4.  No
Litigation. There is no action, arbitration, suit, proceeding or investigation
pending, or to the knowledge of each party, threatened against such party that
would have a material adverse effect on this Agreement or the ability of such
party to perform its obligations under this Agreement, to the extent applicable.

 

2.1.5.  No
Representations Untrue. No representation or warranty made by each party in this
Agreement, individually and to the extent applicable, contains or will contain
any untrue statement of material fact or omit to state any material fact known
to such party necessary to make any statement, warranty or representation not
misleading to the other party. Each party knows of no material facts or
conditions adversely affecting such party which has not been disclosed in
writing to the other party. 

 

2.2.  Further
Assurances. Each
Party hereby acknowledges that it will use its reasonable best efforts to take,
or cause to be taken, all appropriate action, and to do, or cause to be done,
all things necessary, proper or advisable under applicable laws and regulations
to consummate and make effective the transactions contemplated by this
Agreement.

 

2.3.  Mutual
Release. From the
Effective Date, for valuable consideration, the sufficiency of which is hereby
acknowledged, the Parties, on behalf of themselves, their respective successors,
predecessors, parents, affiliates, subsidiaries, divisions, including, but not
limited to their respective officers, directors, stock-holders, managers,
employees, advisors, consultants, insurers, attorneys, heirs, executors,
administrators and authorized representatives, hereby remise, acquit and forever
release each other, and their respective successors, predecessors, parents,
affiliates, subsidiaries, divisions, including, but not limited to their
respective officers, directors, share-holders, managers, employees, advisors,
consultants, insurers, attorneys, heirs, executors, administrators and
authorized representatives from any and all claims, demands, damages, debts,
liabilities, actions, causes of action or suits of whatsoever kind or nature,
presently known or unknown, actual or contingent, asserted or unasserted,
foreseeable or unforeseeable, unanticipated or unsuspected, which any of them
has or may have now or in the future, arising directly or indirectly out of or
involving the Repurchase Transaction, the Repurchased Shares and any other
matter related thereto as they relate thereto. 

 

 

3

 

 

2.4.  Indemnity;
Agreement
to Defend. Each
Party shall and does hereby indemnify and hold the other party and its managers,
members, partners, trustees, beneficiaries, officers, employees and agents, if
applicable, harmless from and against any loss or expense (including attorneys’
fees and costs of litigation) incurred as a result of any claim, action, demand,
judgment or suit caused or alleged to have been caused by or happening in
connection with the breach of any of such party’s covenants, representations,
warranties, agreements, obligations or undertakings under this Agreement.

 

 

	3.  	
      General
      Provisions

 

3.1.  Remedies
Cumulative. The
remedies of each party shall be cumulative and concurrent and may be pursued
singly, successively or together in the party’s sole discretion and as often as
occasion therefore shall arise.

 

3.2.  Entire
Agreement. This
Agreement, including any exhibits hereto, constitutes the entire agreement
between the parties pertaining to the subject matter hereof, and supersedes any
and all prior or contemporaneous written or oral negotiations, agreements,
representations, and understandings of the parties with respect to such subject
matter.

 

3.3.  Attorneys’
Fees. If
there is any legal action or proceeding, including any mediation or arbitration
proceeding, to enforce or interpret any provision of this Agreement or to
protect or establish any right or remedy of any party hereto, the unsuccessful
party to such action or proceeding, whether such action or proceeding is settled
or prosecuted to final judgment, shall pay to the prevailing party as finally
determined, all costs and expenses, including reasonable attorneys’ fees and
costs, incurred by such prevailing party in such action or proceeding, in
enforcing such judgment, and in connection with any appeal from such
judgment.

 

3.4.  Notice. Any
notice, payment, demand, or communication required or permitted to be given by
any provision of this Agreement shall be in writing and shall be hand delivered,
facsimiled, delivered overnight or mailed, first-class postage prepaid,
certified mail, return receipt requested to the applicable addresses or
facsimile numbers set forth on the signature page hereto. Notice shall be
effective: (1) if hand delivered, when delivered; (2) if facsimiled, on the day
of transmission thereof on a proper facsimile machine with confirmation; (3) if
delivered overnight, on the day of delivery thereof by a reputable overnight
courier service, delivery charges prepaid; and (4) if mailed, on the third
business day after the deposit of such item in the mail, postage prepaid. Any
changes in any of the addresses listed herein shall be made by advance written
notice of ten (10) calendar days to the other party.

 

3.5.  Modification,
Amendment or Waiver. This
Agreement may not be amended, supplemented or otherwise modified, and none of
its terms may be waived, unless such amendment, supplement, modification or
waiver is in an express writing and executed by the party or parties to be bound
thereby. The failure of any party at any time or times to require performance of
any provision hereof shall not affect the right of such party at a later time to
enforce the same, and no waiver of any term or provision hereof on any one
occasion shall be deemed to be a waiver of the same or any other provision
hereof at any subsequent time or times.

 

3.6.  Binding
Effect; Assignment. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors, assigns and any persons claim-ing rights by,
through or under them; provided, however, that no assignment of any rights or
delegation of any obligations provided for herein may be made by any party to
this Agreement without the prior written consent of the other
parties.

 

 

4

 

 

3.7.  Construction. This
Agreement shall be construed in accordance with its intent and without regard to
any presumption or any other rule requiring construction against the party
causing the same to be drafted. 

 

3.8.  Governing
Law.
This
Agreement
shall be governed by and construed in accordance with the laws of the State of
Nevada in effect on the date of this Agreement without resort to any conflict of
laws principles. The parties submit to the exclusive jurisdiction of the state
and federal courts located in Clark County, Nevada for the purposes of any and
all legal proceedings arising out of or relating to this Agreement or the
transactions contemplated thereby. Each party hereby irrevocably waives any
objection to venue and any claim that such a proceeding has been brought in an
inconvenient forum, with respect to any such proceeding that is brought in the
state and federal courts located in Clark County, Nevada.

 

3.9.  Counterparts.
This
Agreement
may be executed at different times and in multiple counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument. Any signature page of this Agreement may be detached from
any counterpart without impairing the legal effect to any signatures thereon,
and may be attached to another counterpart, identical in form thereto, but
having attached to it one or more additional signature pages. Delivery by any
party of facsimiled, counterpart signature pages shall be as binding an
execution and delivery of this Agreement by such party as if the party had
delivered an actual physical original of this Agreement with an ink signature
from such party. Any party delivering this Agreement by telecopy shall promptly
thereafter deliver an executed counterpart original hereof to the other
party.

 

3.10.  No
Third Parties Benefited. This
Agreement is made and entered into for the sole protection and benefit of the
Parties and their respective successors and assigns, and no other person or
persons shall have any right of action hereon.

 

3.11.  Severability. If any
provision of this Agreement, or any portion of any provision, shall be deemed
invalid or unenforceable for any reason whatsoever, such invalidity or
unenforceability shall not affect the enforceability and validity of the
remaining provisions hereof. 

 

3.12.  Survival. The
warranties, representations and covenants of each party contained in or made
pursuant to this Agreement shall survive the execution and delivery of this
Agreement and shall survive satisfaction of each party’s obligations pursuant to
this Agreement.

 

3.13.  Captions
and Pronouns.
The
captions appearing at the commencement of the sections hereof are descriptive
only and for convenience in reference to this Agreement and in no way whatsoever
define, limit or describe the scope or intent of this Agreement nor in any way
affect this Agreement.

 

In
Witness Whereof, the
parties hereto have duly executed this Agreement as of the date first set forth
above.

 

	
      VendingData
      Corporation,

      a
      Nevada corporation 
	 	
      Address:

	 	 	 	
      6830
      Spencer Street

	
      By:
	 	 	
      Las
      Vegas, Nevada 89119

	 	
      __________________
	 	 
	
      Title:
	
      __________________
	 	
      Telephone:
	
      702-733-7195

	 	 	 	
      Facsimile:
	
      702-733-7197

	 	 	 	 	 

 

 

5

	
      Triage
      Capital Management LP,

      a
      ___________ limited partnership 
	 	
      Address:

	 	 	 	 
	
      By:
	
      _____________________
	 	
      ___________________________

	
      Title:
	
      General
      Partner
	 	
      ___________________________

	 	 	 	 	 
	 	
      By:
	 	 	 
	 	 	
      _____________________
	 	
      Telephone:
	
      __________________

	 	
      Title:
	
      _____________________
	 	
      Facsimile:
	
      __________________

	 	 	 	 	 
	
      Triage
      Capital Management B LP,

      a
      ___________ limited partnership 
	 	
      Address:

	 	 	 	 
	
      By:
	
      _____________________
	 	
      ___________________________

	
      Title:
	
      General
      Partner
	 	
      ___________________________

	 	 	 	 	 
	 	
      By:
	 	 	 
	 	 	
      _____________________
	 	
      Telephone:
	
      __________________

	 	
      Title:
	
      _____________________
	 	
      Facsimile:
	
      __________________

	 	 	 	 	 
	
      Triage
      Offshore Fund, Ltd,

      a
      ______________________ 
	 	
      Address:

	 	 	 	 
	
      By:
	
      _____________________
	 	
      ___________________________

	
      Title:
	
      _____________________
	 	
      ___________________________

	 	 	 	 	 
	 	
      By:
	 	 	 
	 	 	
      _____________________
	 	
      Telephone:
	
      __________________

	 	
      Title:
	
      _____________________
	 	
      Facsimile:
	
      __________________

	 	 	 	 	 
	
      Periscope
      Partners LP,

      a
      ___________ limited partnership
	 	
      Address:

	 	 	 	
      ___________________________

	
      By:
	 	 	
      ___________________________

	 	
      Leonid
      Frenkel
	 	 
	
      Title:
	
      General
      Partner 
	 	
      Telephone:
	
      __________________

	 	 	 	
      Facsimile:
	
      __________________

	 	 	 	 	 
	
      Leonid
      Frenkel
	 	
      Address:

	 	 	 	
      ___________________________

	
      By:
	 	 	
      ___________________________

	 	
      Leonid
      Frenkel, an individual
	 	 
	 	 	 	
      Telephone:
	
      __________________

	 	 	 	
      Facsimile:
	
      __________________

 

 

6Unassociated Document

Exhibit
10.2

 

THIS
WARRANT
AND THE
SHARES
ISSUABLE UPON THE EXERCISE
OF THIS
WARRANT HAVE NOT
BEEN
REGISTERED
UNDER
THE
SECURITIES
ACT
OF 1933,
AS
AMENDED,
OR ANY
APPLICABLE
STATE SECURITIES
LAW.
THIS WARRANT OR SUCH
SHARES
MAY
NOT
BE
SOLD,
DISTRIBUTED,
PLEDGED,
OFFERED FOR
SALE,
ASSIGNED,
TRANSFERRED,
OR OTHERWISE DISPOSED
OF
UNLESS: (A) THERE IS AN EFFECTIVE
REGISTRATION
STATEMENT
UNDER
SUCH ACT
AND
APPLICABLE
STATE SECURITIES
LAW COVERING
ANY SUCH TRANSACTION INVOLVING
SAID
SECURITIES;
(B) THE
COMPANY
(DEFINED BELOW)
RECEIVES
AN
OPINION
OF
LEGAL
COUNSEL
FOR THE HOLDER
OF THIS
WARRANT STATING
THAT
SUCH
TRANSACTION
IS
EXEMPT FROM REGISTRATION AND SUCH OPINION IS
IN FORM
AND
SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY;
OR (C)
PURSUANT
TO
RULE 144 UNDER
SUCH ACT.

 

FORM
OF

WARRANT
TO PURCHASE

SHARES
OF
COMMON
STOCK

 

VENDINGDATA
CORPORATION

 

This
Is To
Certify
That,
for
value
received, _____________________ (the “Holder”) is
entitled,
during
a
specified
period of time as set forth in Section 3 herein (the “Exercise Period”), to
purchase from VendingData Corporation, a Nevada corporation (the “Company”),
__________
(______) fully paid and nonassessable
shares of the Company’s common stock, par value $0.001 per share (the “Common
Stock”), at an exercise price per share as set forth in Section 1 herein (the
“Exercise Price”) (such number of shares and the Exercise Price being subject to
adjustment as provided herein). The term “Warrant,” as used herein, refers to
this Warrant to Purchase Shares of Common Stock, the term “Warrant Shares,” as
used herein, refers to the shares of Common Stock purchasable hereunder, and the
term “Parties,” as used herein, refers collectively to the Holder and the
Company. This Warrant is issued as part of that certain Repurchase Agreement by
and between the Company and the Holder dated as of April 8, 2005.

 

TERMS
AND
CONDITIONS

 

This
Warrant is subject to the
following
terms,
provisions, and
conditions:

 

1.  Exercise
Price.
The
Exercise
Price
shall
be
$0.01
per
share.

 

2.  Manner
of Exercise; Payment for Shares.

 

 

 

 

2.1.  Subject
to the provisions hereof, this Warrant may be exercised by the Holder, in whole
or in part (but in not less than 1,000 share increments): 

 

2.1.1.  By the
surrender of this Warrant, together with an exercise agreement in the form
attached hereto (the “Exercise Agreement”), duly completed and executed by the
Holder, to the Company during
normal
business
hours on
any
business
day
at the
Company’s principal executive
offices (or
such
other
location as the Company
may designate by notice to the Holder); and 

 

2.1.2.  Upon: (a)
the payment to the Company in cash, by certified or official bank check or by
wire transfer
for the
account of the Company in the amount of the Exercise Price multiplied by the
number of Warrant Shares for which the Warrant is being exercised; or (b) the
surrender to the Company of Warrant Shares for cancellation having a Fair Market
Price (as defined below) on the date of exercise equal to the aggregate Exercise
Price.

 

2.2.  For the
purposes of this Warrant, the “Fair Market Price” per Warrant Share shall mean,
if the Common Stock is traded on a national securities exchange, listed on the
Nasdaq Stock Market or quoted on an over-the-counter quotation system, the
average closing or last reported sale prices, respectively, of the Common Stock
on such exchange or the Nasdaq Stock Market or the average closing bid and asked
prices on an over-the-counter quotation system for the fifteen (15) business
days before the effective date of exercise of the net issuance election. If the
Common Stock is not so listed or admitted to unlisted trading privileges and bid
and ask prices are not reported, the Holder cannot elect to exercise this
Warrant pursuant to Section 2.1.2(b).

 

3.  Issuance
of Certificates. The
Warrant Shares so purchased shall be deemed to be issued to the Holder, as the
record owner of such Warrant Shares, as of the close of business on the date on
which this Warrant shall have been surrendered, the completed Exercise Agreement
shall have been delivered, and payment shall have been made for such Warrant
Shares as set in
Section 2 above. Certificates for the Warrant Shares so purchased, representing
the aggregate number of shares specified in the Exercise Agreement, shall be
delivered to the Holder within a reasonable time, not exceeding ten (10)
business
days,
after this Warrant shall have been so exercised. The certificates so delivered
shall be in such denominations as may be reasonably requested by the Holder and
shall be registered in the name of the Holder. If this
Warrant shall have been exercised only
in part,
then, unless this Warrant has expired, the Company shall, at its expense, at the
time of delivery
of such
certificates, deliver to the Holder a new warrant representing the number of
Warrant Shares
with
respect to which this Warrant shall not then have been exercised.

 

4.  Exercise
Period.
This
Warrant
may be exercised any time before 2:00 p.m., Las Vegas, Nevada time, April
8, 2010; provided, however this Warrant may not be exercised until:

 

4.1.  After
April 8, 2006; and

 

4.2.  The
Holder, a reporting person under Section 13(d) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”), or an affiliated party is in compliance
with the registration requirements of the Investment Advisor Act of 1940, as
amended; provided, further;

 

4.3.  This
Warrant may be exercised prior to the satisfaction of either Section 4.1 or
Section 4.2 above, only in the event of a change of
control involving
the Company, where upon the occurrence of change of control, the Holder shall
have the right to exercise this Warrant and receive the Warrant Shares issuable
hereunder with the limitation that the Holder shall not have any voting rights
with respect to such Warrant Shares. For the purposes of this Warrant, a “change
of control” shall mean: 

 

 

2

 

 

4.3.1.  The
approval by the Company’s stockholders of the merger or consolidation of the
Company with any other unaffiliated corporation or business organization, the
sale of all or substantially all the assets of the Company, or the liquidation
or dissolution of the Company; or

 

4.3.2.  The
beneficial ownership (as defined in Rule 13d-3 under the Securities Exchange Act
of 1934, as amended) by any “person” (as that term is used in Section 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended) of the Company’s
securities representing fifty percent (50%) or more of the combined voting power
of the Company’s then outstanding securities ordinarily having the right to vote
at the election of directors with the exception of James E. Crabbe and any of
this affiliates; or

 

4.3.3.  The
distribution of a proxy statement that solicits proxies from the Company’s
stockholders and seeks stockholder approval of a plan of reorganization, merger
or consolidation of the Company with one or more corporations, as a result of
which the outstanding shares of the Company’s securities are actually exchanged
for or converted into cash or property or securities not issued by the
Company.

 

5.  Covenants of
the Company. The
Company hereby covenants and agrees as follows:

 

5.1.  Shares
to be Fully Paid. All
Warrant Shares
shall,
upon issuance in accordance with the terms of this
Warrant,
be
validly issued,
fully
paid, and non-assessable.

 

5.2.  Reservation
of Shares. During
the Exercise
Period,
the Company shall at all times have authorized, and reserved for the purpose of
issuance upon exercise of this Warrant, a sufficient number of shares of Common
Stock to provide for the exercise of this
Warrant.

 

5.3.  Successors
and Assigns. This
Warrant shall be binding upon any entity succeeding to the Company by merger,
consolidation, or acquisition of all or substantially all the Company’s
assets.

 

6.  Adjustment
Provisions. During
the Exercise Period, the Exercise Price and the number of Warrant Shares shall
be subject to adjustment from time to time as provided in this Section 6.
If the Company shall, prior to the payment of the Note in full, (1) declare
a dividend or make a distribution
of Common
Stock payable in shares of Common Stock, (2) subdivide
its outstanding shares of Common Stock, into a greater number of shares of
Common Stock, (3) combine
its outstanding shares
of Common
Stock
into a smaller number of shares of Common Stock, or (4) issue
any shares of capital stock of the Company by reclassification or capital
reorganization of its shares of Common Stock, then the number of Warrant Shares
and the Exercise Price in effect immediately prior to such action shall be
adjusted so that the Holder shall be entitled to receive the number and kind of
shares of Common Stock or other Capital Stock which the Holder would have owned
or have been entitled to receive immediately after such action had the Holder
exercised the Warrant immediately prior to the record date in the case of (1),
or the effective date in the case of (2),
(3)
or
(4).
In the
event that any adjustment of the Exercise Price as required herein results in a
fraction of a cent, such Exercise Price shall be rounded up to the nearest
cent.

 

7.  Payment
of Expenses.  The
Company and the Holder shall each be responsible for their own costs and
expenses payable in connection with: (1) the negotiation, preparation,
execution
and
delivery of this Warrant and the other agreements to be executed in connection
herewith;
and (2)
the
issuance of certificates for Warrant Shares upon the exercise of this Warrant.
The
Company
shall pay any
issuance tax in
connection with the issuance
of
certificates for Warrant Shares; provided, however, that the Holder shall be
responsible for any income or other taxes in connection with such issuance.

 

 

3

 

 

8.  No
Rights
or
Liabilities as a Stockholder. This
Warrant
shall not
entitle the Holder to any voting rights or other rights as a stockholder
of the
Company.
No provision of this
Warrant,
in the absence of affirmative action by the Holder to purchase Warrant Shares,
and no mere enumeration herein of the rights or privileges of the Holder, shall
give rise to any liability of such Holder for the Exercise Price or as a
stockholder
of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.

 

9.  Transfer,
Exchange, and Replacement
of Warrant. This
Warrant, nor any interest in this Warrant,
may not be sold, distributed, assigned, offered, pledged or otherwise
transferred without the express written consent of the
Company.

 

9.1.  Exchange
of Warrants; Replacements of Warrants. This
Warrant is exchangeable upon the surrender hereof by the Holder to the
Company
at its
office for a new Warrant
of like
tenor and date representing in the aggregate the right
to
purchase the number of shares of Common Stock purchasable hereunder, each of
such new Warrants to represent the right to
purchase such number of shares of Common Stock (not to exceed the aggregate
total number purchasable hereunder) as shall be reasonably designated
by the
Holder at the time of such surrender. Upon receipt by the Company of evidence
reasonably satisfactory
to it of
the loss, theft, destruction, or mutilation of this Warrant, and, in case of
loss, theft or destruction, of indemnity, or security reasonably satisfactory to
it, and upon surrender and cancellation of this Warrant, if mutilated, the
Company will make and deliver
a new
Warrant of like tenor, in lieu of this Warrant.

 

9.2.  Cancellation:
Payment of Expenses.
Upon the
surrender of this Warrant in
connection with any transfer, exchange, or replacement as provided in this
Section 9, this Warrant shall be promptly canceled by the Company.
The
Company
and the Holder shall each be responsible for their own costs and expenses
payable in connection with the preparation, execution, and delivery of new
Warrants pursuant to this Section 9.
The Holder shall be responsible for any tax which may be payable in connection
with any
transfer of a certificate for Warrant Shares.

 

9.3.  Registrar. The
Company shall maintain,
at its
principal executive offices (or such other location as the Company may designate
by notice to the Holder), a registrar for this Warrant, in which the Company
shall
record
the name and address of the person in whose name this Warrant has been issued,
as well as the name and address of each transferee and each prior owner of this
Warrant.

 

10.  Amendments. No
amendment or modification of this Warrant
shall be deemed effective unless and until such amendment or modification is an
express writing executed by both the
Parties.

 

11.  Governing
Law. This
Warrant shall be governed by and construed and enforced in accordance with the
internal laws of the State of Nevada without regard to the body of law
controlling conflicts of law. The parties hereto hereby submit to the exclusive
jurisdiction of the courts located in Clark County, Nevada, with respect to any
dispute arising under this Warrant and the transactions
contemplated
hereby.

 

12.  Registration
Rights.

 

12.1.  Piggyback
Registration Rights.
Whenever the Company proposes to register any of its equity securities under the
Securities Act of 1933 (the “Securities Act”) (other than a registration on Form
S-4 or Form S-8 or any successor or similar forms) and the registration form to
be used may be used for the registration of the Warrant Shares, whether or not
for sale for its own account, the Company will give prompt written notice to
Holder of its intention to effect such a registration and will include in such
registration all of the Warrant Shares with respect to which the Company has
received written request for inclusion therein within twenty (20) days after the
receipt of the Company’s notice; provided, however, such “piggyback”
registration (a “Piggyback Registration”) shall be subject to the terms
and conditions of an underwriting agreement among the Company, Holder and the
managing underwriter, if applicable, the customary underwriter cut back
provisions and the execution of a customary standstill of not less than one
hundred and eighty (180) days. In
addition, the
Company and the
managing underwriters, if applicable, shall
have the right to terminate or withdraw any registration initiated by the
Company or to reduce the number of shares proposed to be registered in view of
market conditions.

 

 

4

 

 

12.2.  Registration
Procedure. Upon
the request by Holder to initiate either a Piggyback Registration, the Company
will use its best efforts to effect the registration of the relevant Warrant
Shares in accordance with the intended method of disposition
thereof.

 

12.3.  Restrictions.
Holder may not
assign any of its registration rights granted under this Section 12 unless the
Company has provided its prior written consent to such assignment and the
assignment of this Warrant or the Warrant Shares, as applicable. 

 

12.4.  Fees. The
Company shall pay all Registration Expenses relating to any registration of the
Warrant Shares hereunder. “Registration Expenses” shall mean all reasonable fees
and expenses incident to the Company’s performance of or compliance with this
Section 12. Notwithstanding the foregoing, Holder shall pay any and all
underwriting discounts, commissions and transfer taxes attributable to the
Warrant Shares and the fees of Holder’s own counsel in connection with the sale
of the Warrant Shares.

 

12.5.  Cooperation;
Indemnification by Holder. In
connection with any registration statement in which Holder is participating,
Holder will furnish to the Company in writing such information and documents as
the Company reasonably requests for use in connection with any such registration
statement or prospectus and, to the extent permitted by law, will indemnify and
hold harmless the Company, its affiliates and their respective officers,
directors, employees and affiliates against any losses, claims, damages,
liabilities, joint or several, to which such parties may become subject under
the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings, whether commenced or threatened, in
respect thereof) arise out of or are based upon: (1) any untrue or alleged
untrue statement of a material fact contained in the registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or in any application; or (2) any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that such untrue statement or
omission is made in such registration statement, prospectus, preliminary
prospectus or any amendment or supplement thereto, or in any application, in
reliance upon and in conformity with written information prepared and furnished
to the Company by such holder expressly for use therein. The Holder shall
reimburse the Company, its affiliates, officers, directors, employees and
affiliates for any legal or any other expenses incurred by them in connection
with investigating or defending any such loss, claim, liability, action or
proceeding; provided, however, that the obligation to indemnify will be limited
to Holder and shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability, or action if such settlement is effected without the
consent of Holder (which consent shall not be unreasonably
withheld).

 

 

5

 

 

12.6.  Indemnification
by the Company. In
connection with any registration statement in which Holder is participating, the
Company will indemnify and hold harmless Holder, its affiliates and their
respective officers, directors, employees and affiliates against any losses,
claims, damages, liabilities, joint or several, to which such parties may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions or proceedings, whether commenced or
threatened, in respect thereof) arise out of or are based upon: (1) any untrue
or alleged untrue statement of a material fact contained in the registration
statement, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or in any application; or (2) any omission or alleged
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, unless such untrue statement or omission
is made in such registration statement, prospectus, preliminary prospectus or
any amendment or supplement thereto, or in any application, in reliance upon and
in conformity with written information prepared and furnished to the Company by
Holder expressly for use therein. The Company shall reimburse Holder, its
affiliates, officers, directors, employees and affiliates for any legal or any
other expenses incurred by them in connection with investigating or defending
any such loss, claim, liability, action or proceeding; provided, however, that
the obligation to indemnify will be limited to the Company and shall not apply
to amounts paid in settlement of any such loss, claim, damage, liability, or
action if such settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld).

 

12.7.  Termination. The
ability of Holder to initiate a Piggyback Registration shall terminate upon the
earlier to occur of: (1) five (5) years after the date of this Warrant; (2) the
date Holder no longer holds the Warrant Shares; or (3) the ability of Holder to
sell its Warrant Shares then owned immediately pursuant to Rule 144 of the
Securities Act. 

 

13.  Expiration
Date. This
Warrant
shall expire
and become null
and void
and of no further force or
effect
at 2:00
p.m. Las Vegas, Nevada time no later than April 8, 2010. 

 

In
Witness
Whereof, the
Company has caused this Warrant to be signed by its duly authorized
officer.

 

 

	 	 	 
	 	
      VENDINGDATA
      CORPORATION

      a Nevada Company

	 
 	 
 	 
 
	Date: April 8, 2005	By:  	
	 	
      
      

      

	 	

 

 

6

EXERCISE
AGREEMENT

 

TO:
 VENDINGDATA
CORPORATION
(THE “COMPANY”)

 

The
undersigned, pursuant to the provisions set forth
in the
attached Warrant to Purchase Shares of Common Stock (the “Warrant”) hereby
irrevocably elects and agrees to:

 

	 	
      o
	
      Purchase
      ____________ shares (the “Exercised Shares”) of the Company’s common stock
      (“Common
      Stock”)
      covered by the Warrant
      and
      makes payment herewith in full therefore at the price per share provided
      by the Warrant in cash or by certified or official bank check in the
      amount of $________________;
      or

 

	 	
      o
	
      Purchase
      ____________ shares (the “Exercised Shares”) of the Company’s common stock
      (“Common Stock”) covered by the Warrant and make payment of the exercise
      price through the surrender of the right to purchase ____________ shares
      of Common Stock covered by the Warrant, as permitted under Section
      2.1.2(b) of the Warrant.

 

If said
number of shares of Common Stock, whether purchased or surrendered, shall not be
all the shares available under the Warrant, a new warrant is to be issued in the
name of said undersigned covering the balance of the shares available thereunder
less any fraction of a share paid in cash. Please issue a certificate or
certificates for the Exercised Shares in the name of and pay any cash for any
fractional share to:

 

 

	 	
      NAME:
	 
	 	 	 
	 	
      SIGNATURE:
	 
	 	 	 
	 	
      DATED:
	 
	 	 	 
	 	
      ADDRESS:
	 
	 	 	 
	 	 	 
	 	 	 
	 	
      NOTE:
	
      The
      above signature should correspond exactly with the name on the face of
      the
      Warrant.

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