8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): August 9, 2005

VENDINGDATA CORPORATION

(Exact Name of Registrant as Specified in Its Charter)

Nevada	001-32161	91-1696010
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification Number)

6830 Spencer Street

Las Vegas, Nevada 89119

(Address of principal executive offices)

(702) 733-7195

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions.

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14d-2(b)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)

Item 2.02 Results of Operations and Financial Condition

On August 9, 2005, VendingData Corporation issued a press release announcing results for the second quarter ended June 30, 2005. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

The information in this Item 2.02, including the information set forth in the Company’s press release filed as Exhibit 99.1 to, and incorporated in, this Current Report, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section. The information in Exhibit 99.1 furnished pursuant to this Item 2.02 shall not be incorporated by reference into any registration statement or other documents pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or into any filing or other document pursuant to the Exchange Act except as otherwise expressly stated in any such filing.

Item 7.01 Regulation FD Disclosure

On August 9, 2005, VendingData Corporation made available the PowerPoint presentation to be used by participants in the VendingData Corporation’s earnings call at 4:30 p.m., Eastern time, on August 9, 2005.

The information contained in this Item 7.01, including the information set forth in the PowerPoint presentation filed as Exhibit 99.2 to, and incorporated in, this Current Report, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. The information in Exhibit 99.2 furnished pursuant to this Item 7.01 shall not be incorporated by reference into any registration statement or other documents pursuant to the Securities Act or into any filing or other document pursuant to the Exchange Act except as otherwise expressly stated in any such filing.

Item 9.01 Financial Statements and Exhibits

(c) Exhibits.

Exhibit Number	Description
99.1	Press Release dated August 9, 2005
99.2	PowerPoint presentation dated August 9, 2005

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	VENDINGDATA CORPORATION
Dated: August 9, 2005	By:	/s/ Mark R. Newburg
		Mark R. Newburg, Executive Director

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated August 9, 2005
99.2	PowerPoint presentation dated August 9, 2005

EX-99.1

Contact: Mark R. Newburg Executive Director VendingData™ Corporation 702-733-7195 mnewburg@vendingdata.com or Yvonne L. Zappulla Managing Director Wall Street Investor Relations Corp. 212-681-4108 Yvonne@WallStreetIR.com

VendingData^™Corporation Reports

Second Quarter 2005 Financial Results

LAS VEGAS, Nevada- (PRNewswire)-August 9, 2005-VendingData^™ Corporation (AMEX: VNX), today reported financial results for its second quarter ended June 30, 2005. The Company reported gross revenues of $1.1 million, before sales returns and allowances of $291,000, compared to gross revenues of $861,000for the first quarter of 2005 and $2.1 million for the second quarter of 2004. Revenues from sales of shuffler units rose approximately 30 percent over the first quarter of 2005 due to the addition of the PokerOne™ shuffler to the Company’s product line. Deck Checker^™ unit sales grew by four percent over the prior quarter, while SecureDrop^®revenues increased from $11,000 to $61,000. During the second quarter, the shuffler line accounted for 61 percent of gross revenues and Deck Checker^™ contributing approximately 30 percent of total gross revenues.

The Company reported a net loss applicable to common stockholders for the second quarter of $(3.2) million or $(0.19) per share versus a net loss of $(2.5) million or $(0.15) per share for the first quarter 2005 and a net loss of $(1.1) million or $(0.06) per share for the second quarter of 2004. The sequential increase in net loss over the prior quarter was primarily due to a $441,000 increase in general and administrative expenses and a $190,000 increase in interest expenses.

The close of the first quarter marked the beginning of a number of sweeping changes at the Company including the installation of new key members of management and the implementation of a number of key initiatives intended to grow revenues and increase profitability.

VendingData’sÔ gross margin on revenue for the three months ended June 30, 2005, was 32 percent compared to the gross margin on revenue for the first quarter 2005 of 45 percent and 48 percent for the second quarter of 2004. The decrease in gross margin reflects sales returns and allowances adjustment of $291,000 due to the return of earlier version shufflers sold in prior periods. Prior to these adjustments, gross margin on revenues for the three months ended June 30, 2005 was 51 percent. The Company anticipates a continued trend of lower costs through the end of this fiscal year from its manufacturing facilities in China, thereby continuing to enhance the company’s overall gross margin.

Selling, general and administrative expenses were $2.8 million during the quarter compared to $2.4 million for the three months ended March 31, 2005 and $1.5 million for the prior year second quarter. The increase in expenses over the prior first quarter was predominately related to a $323,000 increase in legal and regulatory costs associated with the company’s lawsuit with Shuffle Master, Inc. and lawsuits and regulatory issues pertaining to former senior management. The year over year increase of $1.3 million was attributed to an $810,000 increase in legal costs, a $225,000 increase in consulting expenses associated with the change in management team, a $200,000 increase in salaries primarily attributable to the expensing of stock options, a $59,000 increase in rent expense due mainly to the Company’s expansion in China, offset by a $70,000 decrease in travel and entertainment expenses. For the three months ended June 30, 2005, research and development expenses of $178,000 were relatively flat with the prior first quarter 2005.

Interest expenses during the second quarter of 2005 totaled $507,000 compared to $317,000 for the prior three months ended March 31, 2005 and $232,000 for the second quarter 2004. The increase reflects the additional debt service associated with currently outstanding 10 percent senior secured convertibles notes issued at the end of the first quarter 2005.

Cash and equivalents on June 30, 2005 were $2.8 million compared to $6.5 million at March 31, 2005 and $925,000 at December 31, 2004. During the three months, accounts receivable (trade) of $4.8 million were essentially flat with the prior quarter. Inventories increased by approximately $600,000 during the current period to $7.4 million to prepare for the RandomPlus™ production. Total liabilities were approximately flat with the prior quarter at $17.6 million versus an increase of $9 million over the prior year second quarter. The increase in total liabilities during 2005 reflects the issuance of $10 million of additional senior secured convertible notes in February 2005 and March 2005.

“Four months ago our new management team began to transition VendingData. Although we are at the early stages of executing on our business plan, dramatic improvements have been achieved in product quality, process and procedure. We have introduced a consistent upgrade cycle for our shuffler line and have already received approval on a future version. We are actively upgrading over 100 version one PokerOne™ units to our version two and will début version three at the Global Gaming Exposition (G2E) next month. RandomPlus™ has been resubmitted to GLI and Nevada reflecting hardware enhancements and software upgrades with expectations that the shuffler will be available for distribution late third quarter to early fourth quarter,” commented Mark Newburg, Executive Director of VendingData. “As our product quality reputation begins to improve, so too have our opportunities to establish distribution partnerships. This is a major focus of our efforts during this current quarter.”

QUARTER HIGHLIGHTS

Effective July 11, 2005, Simon Herbert, 25 year senior gaming industry executive, joined VendingData™ to head the company’s international sales effort

As Vice President of International Sales, Mr. Herbert is responsible for VendingData™'s international distribution partnerships. Mr. Herbert is credited with building several multi- million operations, most notably during his tenure as CEO of TCS Group. During his 8-years with TCS, Mr. Herbert consolidated operations and forged a number of strategic relationships, creating one of the largest private global gaming supply companies.

VendingData™ strengthens its legal counsel

In July 2005, VendingData™ engaged Daniel Donahue of Preston Gates & Ellis as the Company’s general corporate attorney. Mr. Donahue’s expertise is in the area of corporate law and corporate finance. Prior to entering private practice in 1986, Mr. Donahue was a staff attorney for six years with the SEC, three years of which were spent in the SEC’s Division of Enforcement and three years in the SEC’s Division of Corporation Finance.

In July 2005, VendingData™ engaged Anthony Cabot of Lewis and Roca and formerly a partner of Lionel Sawyer & Collins based in Las Vegas, Nevada. Mr. Cabot’s expertise is in gaming and Internet gaming law. He is the founding member of the International Masters of Gaming Law Association, Co-Editor-in-Chief of the Gaming Law Review and the Founding editor of the Internet Gambling Report V. Mr. Cabot is listed in the 2003-2005 editions of The Best Lawyers in America®, by Woodward/While, Aiken, SC in the categories of Cyberlaw and Gaming Law.

VendingData^™ received approval from Nevada Gaming Control Board as well as a number of additional GLI approvals for refinements to its PokerOne™ Shuffler

During July 2005, VendingData™ received approval from the Nevada Gaming Control Board for refinements made to the earlier PokerOne™ shuffler, which had received approval in early November 2004. Additionally, the PokerOne™ has received the requested approvals from Gaming Laboratories International ("GLI") in the following jurisdictions: California (tribal), Colorado (state), Connecticut (tribal), Illinois (state), Indiana (state), Iowa (state & tribal), Kansas (tribal), Louisiana (state & tribal), Missouri (state), New Mexico (tribal), New York (tribal), North Dakota (tribal), Oregon (tribal), South Dakota (state & tribal), Washington (tribal). 108 PokerOne™ units have been placed in casinos worldwide during the second quarter 2005.

Current Shuffle Master litigation status

Random Ejection Shuffler - On July 12, 2005, VendingData entered into a Settlement Agreement with Shuffle Master, Inc., with respect to the legal proceeding filed on March 27, 2002, by Shuffle Master, Inc., against VendingData™ in the United States District Court, District of Nevada. The complaint alleged, among other things, that VendingData™ was infringing on two of Shuffle Masters patents regarding registering use of a playing card shuffler apparatus and the displaying of the use on a display. VendingData™ had denied the claims and asserted counterclaims against Shuffle Master. Pursuant to the Settlement Agreement, the parties have agreed to dismiss their claims and counter-claims in the particular action and Shuffle Master has agreed not to bring any claims against VendingData™ relating to the infringement of the above-referenced patents for past or future use of the technology, subject to certain exceptions. VendingData™ will make two settlement payments to Shuffle Master each in the amount of $400,000, one of which was paid on July 14, 2005, and one payment of $400,000 to be paid no later than May 14, 2006.

PokerOne™ - On March 3, 2005,the United States Court of Appeals for the Federal Circuit stayed the preliminary injunction issued by the United States District Court for the District of Nevada pending the disposition of the appeal. The preliminary injunction had prohibited VendingData™ from selling its PokerOne™ shuffler while the action brought by Shuffle Master, Inc. was pending. In granting a stay of the preliminary injunction, the United States Court of Appeals stated that VendingData™ has shown the requisite likelihood of success in obtaining a stay of the preliminary injunction, pending appeal. As of August 9, 2005, both companies await feedback from the Markman hearing. VendingData™ has recently filed a supplemental brief, which details a similar case reflecting the July 12, 2005 decision by the Federal Circuit Court in Phillips v. AWH Corp (F.3d, WL 160331), which we believe is favorable to VendingData™’s position.

CONFERENCE CALL

Conference Call Details:

Date/Time:	Tuesday, August 9, 2005--4:30 p.m. (ET)
Telephone Number:	800-299-7635
International Dial-In Number:	617-786-2901
Participant Pass code:	81834121
Internet Access:	www.vendingdata.com or www.fulldisclosure.com

During the conference call, management intends to provide a PowerPoint presentation, which will be available on the Internet on the company website (www.vendingdata.com) and through Thompson/CCBN (www.fulldisclosure.com).

It is recommended that participants phone-in at least 10 minutes before the call is scheduled to begin. A replay of the conference call in its entirety will be available approximately one hour after its completion for 7 days by dialing 888-286-8010 (U.S.), 617-801-6888 (International) and entering the pass code 65557846, and on the Internet at www.fulldisclosure.com.

About VendingData^™ Corporation

VendingData™ Corporation is a manufacturer and distributor of products for the gaming industry including the SecureDrop® System, Deck Checker™, Random Ejection Shuffler™ and PokerOne™. The Company’s products are currently installed in casinos throughout the world, including Caesars Palace, Circus Circus, Harrah’s Entertainment, Luxor, Oneida Bingo & Casino, Sunset Station and the Venetian in the United States, and in casinos in Argentina, China, Columbia, Korea, Malaysia, Peru, United Kingdom and Uruguay. Visit the VendingData™ website at http://www.vendingdata.com.

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties, and actual circumstances, events or results may differ materially from those projected in such forward-looking statements. Factors that could cause or contribute to differences include, but are not limited to, the Company’s ability to obtain capital as and when needed; the success of the transition of the Company’s manufacturing and assembly to China; changes in the level of consumer or commercial acceptance of the Company's existing products and new products as introduced; competitive advances; acceleration and/or deceleration of various product development and roll out schedules; higher than expected manufacturing, service, selling, administrative, product development and/or roll out costs; current and future litigation; regulatory and jurisdictional issues involving VendingData™ Corporation or its products specifically, and for the gaming industry in general; general and casino industry economic conditions; the financial health of the Company's casino and distributor customers both nationally and. For a discussion of these and other factors, which may cause actual events or results to differ from those projected, please refer to the Company’s most recent annual report on Form 10-KSB and quarterly reports on Form 10-QSB, as well as other subsequent filings with the Securities and Exchange Commission. The Company cautions readers not to place undue reliance on any forward-looking statements. The Company does not undertake, and specifically disclaims any obligation, to update or revise such statements to reflect new circumstances or unanticipated events as they occur.

# # #

VENDINGDATA™ CORPORATION

Statements of Operations

(UNAUDITED)

	Three Months Ended June 30,						Six Months Ended June 30,
	2005			2004			2005			2004
Revenues:
Sales	$	908,934		$	1,877,656		$	1,619,669		$	2,870,710
Rental		135,439			161,110			256,779			372,173
Other		31,092			20,762			60,439			109,535
Gross revenue		1,075,465			2,059,528			1,936,887			3,352,418
Sales returns and allowances		(290,838	)					(290,838	)
		784,627			2,059,528			1,646,049			3,352,418
Operating costs and expenses:
Cost of sales		530,049			1,068,888			999,739			1,849,625
Selling, general and administrative		2,818,477			1,451,912			5,195,563			2,877,946
Research and development		177,823			392,807			367,832			671,560
		3,526,349			2,913,607			6,563,134			5,399,131
Loss from operations		(2,741,723	)		(854,079	)		(4,917,086	)		(2,046,713	)
Interest expense, unrelated parties		491,985			231,479			808,807			494,101
Interest expense, related parties		15,063			540			15,063			15,063
Gain on disposition of assets		—			—			1,900			(567	)
Total interest expense, net		507,048			232,019			825,770			508,597
Net loss	$	(3,248,770	)	$	(1,086,098	)	$	(5,742,855	)	$	(2,555,310	)
Basic and Diluted loss per share	$	(0.19	)	$	(0.06	)	$	(0.34	)	$	(0.15	)
Weighted average shares outstanding		16,787,756			17,187,798			17,096,510			17,146,750

VENDINGDATA™ CORPORATION

Balance Sheets

	June 30, 2005			December 31, 2004
ASSETS	(unaudited)
Current assets:
Cash and cash equivalents	$	2,821,346		$	924,804
Current portion of accounts receivable, trade, net of allowance for uncollectables of $223,590 and $125,530		3,621,652			2,646,568
Due from affiliate		9,150			25,000
Other receivables		142,539			35,394
Inventories		7,423,873			6,462,626
Prepaid expenses		113,527			86,576
		14,144,087			11,180,968
Equipment rented to customers, net of accumulated depreciation of $687,248 and $564,351		277,697			400,594
Property and equipment, net of accumulated depreciation of $2,393,997 and $2,250,432		867,700			923,459
Intangible assets, net of accumulated amortization of $516,895 and $438,488		1,851,237			1,129,644
Due from affiliate - non current		90,800			118,800
Accounts receivable, trade, net of current portion, less unamortized discount		1,152,279			1,264,912
Deferred expenses		834,206			569,956
Deposits		936,716			980,216
	$	20,154,722		$	16,568,551
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of leases payable	$	1,189,602		$	1,941,445
Accounts payable		2,372,754			1,240,677
Accrued expenses		829,261			427,197
Deferred revenues, current portion		207,245			239,680
Short-term debt		50,000			238,250
Customer deposits		191,840			193,615
		4,840,702			4,280,864
Long-term obligations
Deferred revenues, net of current portion		153,250			198,585
Notes Payable		12,000,000			3,250,000
Leases payable, net of current portion		568,437			893,244
Total Liabilities		17,562,389			8,622,693
Stockholders' equity:
Preferred stock, $.001 par value, 10,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $.001 par value, 25,000,000 shares authorized, 17,212,058 shares and 17,187,798 shares issued and outstanding		17,212			17,200
Treasury stock 448,053 shares at cost		(846,820	)		—
Deferred expenses		(1,422,136	)		(183,074	)
Additional paid in capital		62,318,473			59,843,273
Deficit		(57,474,396	)		(51,731,541	)
Total stockholders' equity		2,592,333			7,945,858
Total liabilities and stockholders' equity	$	20,154,722		$	16,568,551

EX-99.2