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.
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US$___________
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July 11,
2006
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CONVERTIBLE UNSECURED
PROMISSORY NOTE
1.
Obligation
. For value received, VENDINGDATA
CORPORATION, a Nevada corporation (“Maker”), promises
to pay to _________________ ("Holder"), the Principal Amount (as
defined below) in the manner and upon the terms and conditions set
forth herein.
2.
Principal Amount
. The principal amount
(“Principal Amount”) of this Note is _______________
Dollars (US$________). 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
