UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
TIDEL TECHNOLOGIES, INC.
--------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, $0.01 par value per share
--------------------------------------------------------------------------------
(Title of Class of Securities)
886368109
--------------------------------------------------------------------------------
(CUSIP Number)
Eugene Grin with a copy to:
Director Steven E. Siesser, Esq.
Laurus Master Fund, Ltd. Lowenstein Sandler PC
825 Third Avenue, 14th Floor 65 Livingston Avenue
New York, New York 10022 Roseland, New Jersey 07068
(212) 541-5800 (973) 597-2506
--------------------------------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
January 13, 2006
--------------------------------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule l3G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box. |X|
NOTE: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See ss. 240.13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Cusip No. 886368109
--------------------------------------------------------------------------------
1. Names of Reporting Persons. Laurus Master Fund, Ltd.
--------------------------------------------------------------------------------
I.R.S. Identification Nos. of above persons (entities only):
98-0337673
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See
Instructions): (a)
(b)
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Source of Funds (See Instructions): OO
--------------------------------------------------------------------------------
5. Check if Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e): Not Applicable
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization: Cayman Islands
--------------------------------------------------------------------------------
Number of 7. Sole Voting Power: 19,251,000*
Shares Beneficially ---------------------------------------------------
Owned by 8. Shared Voting Power: 19,251,000*
Each Reporting ---------------------------------------------------
Person With 9. Sole Dispositive Power: 19,251,000*
---------------------------------------------------
10. Shared Dispositive Power: 19,251,000*
---------------------------------------------------
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
19,251,000*
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions): Not Applicable
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11): 49.8%*
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions): CO
--------------------------------------------------------------------------------
*These shares are owned by Laurus Master Fund, Ltd. Laurus Master Fund, Ltd. is
managed by Laurus Capital Management, LLC. Eugene Grin and David Grin, through
other entities, are the controlling principals of Laurus Capital Management, LLC
and share sole voting and investment power over the shares owned by Laurus
Master Fund, Ltd.
-2-
Cusip No. 886368109
--------------------------------------------------------------------------------
1. Names of Reporting Persons. Laurus Capital Management, LLC
I.R.S. Identification Nos. of above persons (entities only):
13-4150669
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See
Instructions): (a)
(b)
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Source of Funds (See Instructions): OO
--------------------------------------------------------------------------------
5. Check if Disclosure of Legal Proceedings Is Required Pursuant
to Items 2(d) or 2(e): Not Applicable
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization: Delaware
--------------------------------------------------------------------------------
Number of 7. Sole Voting Power: 19,251,000*
Shares Beneficially ----------------------------------------------------
Owned by 8. Shared Voting Power: 19,251,000*
Each Reporting ----------------------------------------------------
Person With 9. Sole Dispositive Power: 19,251,000*
----------------------------------------------------
10. Shared Dispositive Power: 19,251,000*
----------------------------------------------------
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
19,251,000*
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions): Not Applicable
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11): 49.8%*
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions): OO
--------------------------------------------------------------------------------
*These shares are owned by Laurus Master Fund, Ltd. Laurus Master Fund, Ltd. is
managed by Laurus Capital Management, LLC. Eugene Grin and David Grin, through
other entities, are the controlling principals of Laurus Capital Management, LLC
and share sole voting and investment power over the shares owned by Laurus
Master Fund, Ltd.
-3-
Cusip No. 886368109
--------------------------------------------------------------------------------
1. Names of Reporting Persons. David Grin
I.R.S. Identification Nos. of above persons (entities only):
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See
Instructions): (a)
(b)
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Source of Funds (See Instructions): OO
--------------------------------------------------------------------------------
5. Check if Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e): Not Applicable
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization: Israel
--------------------------------------------------------------------------------
Number of 7. Sole Voting Power: 19,251,000*
Shares Beneficially ---------------------------------------------------
Owned by 8. Shared Voting Power: 19,251,000*
Each Reporting ---------------------------------------------------
Person With 9. Sole Dispositive Power: 19,251,000*
---------------------------------------------------
10. Shared Dispositive Power: 19,251,000*
---------------------------------------------------
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
19,251,000*
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions): Not Applicable
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11): 49.8%*
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions): IN
--------------------------------------------------------------------------------
*These shares are owned by Laurus Master Fund, Ltd. Laurus Master Fund, Ltd. is
managed by Laurus Capital Management, LLC. Eugene Grin and David Grin, through
other entities, are the controlling principals of Laurus Capital Management, LLC
and share sole voting and investment power over the shares owned by Laurus
Master Fund, Ltd.
-4-
Cusip No. 886368109
--------------------------------------------------------------------------------
1. Names of Reporting Persons. Eugene Grin
I.R.S. Identification Nos. of above persons (entities only):
--------------------------------------------------------------------------------
2. Check the Appropriate Box if a Member of a Group (See
Instructions): (a)
(b)
--------------------------------------------------------------------------------
3. SEC Use Only
--------------------------------------------------------------------------------
4. Source of Funds (See Instructions): OO
--------------------------------------------------------------------------------
5. Check if Disclosure of Legal Proceedings Is Required Pursuant to
Items 2(d) or 2(e): Not Applicable
--------------------------------------------------------------------------------
6. Citizenship or Place of Organization: United States
--------------------------------------------------------------------------------
Number of 7. Sole Voting Power: 19,251,000*
Shares Beneficially ------------------------------------------------
Owned by 8. Shared Voting Power: 19,251,000*
Each Reporting ------------------------------------------------
Person With 9. Sole Dispositive Power: 19,251,000*
------------------------------------------------
10. Shared Dispositive Power: 19,251,000*
------------------------------------------------
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
19,251,000*
--------------------------------------------------------------------------------
12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(See Instructions): Not Applicable
--------------------------------------------------------------------------------
13. Percent of Class Represented by Amount in Row (11): 49.8%*
--------------------------------------------------------------------------------
14. Type of Reporting Person (See Instructions): IN
--------------------------------------------------------------------------------
*These shares are owned by Laurus Master Fund, Ltd. Laurus Master Fund, Ltd. is
managed by Laurus Capital Management, LLC. Eugene Grin and David Grin, through
other entities, are the controlling principals of Laurus Capital Management, LLC
and share sole voting and investment power over the shares owned by Laurus
Master Fund, Ltd.
-5-
Item 1. Security and Issuer.
(a) Name and Address of Principal Executive Offices of Issuer:
Tidel Technologies, Inc.
2900 Wilcrest Drive, Suite 205
Houston, Texas 77042
(b) Title and Class of
Equity Securities: Common Stock, par value $.01 per share
Item 2. Identity and Background.
(a) Name of Person Filing: Laurus Master Fund, Ltd.
This Schedule 13D is also filed on behalf of Laurus Capital
Management, LLC, a Delaware limited liability company, Eugene Grin
and David Grin. Laurus Capital Management, LLC manages Laurus Master
Fund, Ltd. Eugene Grin and David Grin, through other entities, are
the controlling principals of Laurus Capital Management, LLC and
share sole voting and investment power over the shares owned by
Laurus Master Fund, Ltd. Information related to each of Laurus
Capital Management, LLC, David Grin and Eugene Grin is set forth on
Appendix A hereto.
(b) Jurisdiction of Incorporation: Cayman Islands
(c) Principal Business: Direct investments in companies
(d) Address of Principal Business and Principal Office:
c/o Laurus Capital Management, LLC c/o M&C Corporate Services Ltd.
825 Third Avenue, 14th Floor P.O. Box 309 GT
New York, NY 10022 Ugland House
South Church Street
George Town
Grand Cayman
Cayman Islands
(e) Criminal Proceedings:
During the last five years neither Laurus Master Fund, Ltd. nor
Laurus Capital Management, LLC, Eugene Grin or David Grin has been
convicted in any criminal proceeding.
(f) Civil Proceedings:
During the last five years neither Laurus Master Fund, Ltd. nor
Laurus Capital Management, LLC, Eugene Grin or David Grin has been
party to any civil proceeding of a judicial or administrative body
of competent jurisdiction as a result of which such person would
have been subject to any judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject
to, Federal or State securities laws or finding any violation with
respect to such laws.
-6-
Item 3. Source and Amount of Funds or Other Consideration.
Laurus Master Fund, Ltd. has not paid any funds to the Company in
connection with its acquisition of the shares described in Item 5 of this
Schedule 13D, of which (i) 1,251,000 shares (the "Existing Shares") were issued
by the Company on November 26, 2004, in satisfaction of fees totaling $375,300
owed to Laurus Master Fund, Ltd. and (ii) 18,000,000 shares were issued upon
conversion, at a price per share of $.30, of $5,400,000 aggregate principal
amount (the "Conversion Amount") of the convertible term note in the initial
principal amount of $6,450,000, dated November 25, 2003, together with an
additional $292,987 principal amount added thereto on November 26, 2004 (as
amended, the "2003 Note"), provided that Laurus Master Fund, Ltd. used its
investment capital to previously pay the Company an amount of cash equal to the
full face value of the 2003 Note.
Item 4. Purpose of Transaction.
Laurus Master Fund, Ltd. entered into an exercise and conversion
agreement, dated as of January 12, 2006 (the "Conversion Agreement"), with
Sentinel Technologies, Inc., a Delaware corporation ("STI"), Sentinel Operating,
L.P., a Texas limited partnership and an affiliate of STI ("Sentinel"), and
Tidel Technologies, Inc., a Delaware corporation (the "Company"), pursuant to
which Laurus Master Fund, Ltd. agreed to acquire up to 18,000,000 shares of
common stock of the Company (the "Note Shares") upon conversion of the
Conversion Amount of the 2003 Note (the "Conversion"), which Conversion occurred
on January 13, 2006. Laurus Master Fund, Ltd. agreed to the Conversion in order
to, among other things, vote the Note Shares and the Existing Shares in favor of
the Company's proposed sale of the assets of its cash security business to
Sentinel (the "Asset Sale"). Following the Conversion, Laurus Master Fund, Ltd.
will own 49.8% of the Company's then outstanding shares of common stock.
Except as set forth above or as disclosed under Item 6, none of
Laurus Master Fund, Ltd. Laurus Capital Management, LLC, David Grin and Eugene
Grin has any present plans or proposals which relate to or would result in any
of the transactions required to be described in Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) Number of Shares Beneficially Owned: 19,251,000*
Right to Acquire: 0 shares
Percent of Class: 49.8% (based upon 38,677,210 shares of common
stock outstanding immediately following the Conversion)
(b) Sole Power to Vote, Direct the Vote of, Dispose or Direct the
Disposition of Shares: 19,251,000 shares*
Shared Power to Vote, Direct the Vote of, or Dispose or Direct the
Disposition of Shares: 19,251,000 shares*
-7-
(c) Recent Transactions:
On January 13, 2006, Laurus Master Fund, Ltd. converted the
Conversion Amount of the 2003 Note into 18,000,000 shares of Company
common stock pursuant to the Conversion Agreement.
(d) Rights with Respect to Dividends or Sales Proceeds: Not applicable.
(e) Date of Cessation of Five Percent Beneficial Ownership: Not
applicable.
*These shares are owned by Laurus Master Fund, Ltd. Laurus Master
Fund, Ltd. is managed by Laurus Capital Management, LLC. Eugene Grin
and David Grin, through other entities, are the controlling
principals of Laurus Capital Management, LLC and share sole voting
and investment power over the shares owned by Laurus Master Fund,
Ltd.
Item 6. Contracts, Arrangements, Understandings or Relationships With
Respect to Securities of the Issuer.
To effect the conversion of the 2003 Note, the Company and Laurus
Master Fund, Ltd. agreed pursuant to the Conversion Agreement to waive any
provision of any agreement, contract, arrangement or document entered into by
the Company and any of its affiliates and Laurus Master Fund, Ltd. pursuant to
which Laurus Master Fund, Ltd. and any of its affiliates is restricted from
converting the Conversion Amount of the Note, but only to the extent required
for the Laurus Master Fund, Ltd. to convert the Conversion Amount of the Note.
The Company's obligation to effect the Conversion is conditioned upon to a
number of customary closing conditions. In the event that the Asset Sale does
not occur by March 31, 2006, the Company is required under the Conversion
Agreement to immediately redeem the Note Shares for an amount equal to
$5,400,000 in cash.
In connection with the Asset Sale, Laurus Master Fund, Ltd. has
agreed, pursuant to a voting agreement, dated as of January 12, 2006 (the
"Voting Agreement") by and among STI, Sentinel, the Company and Laurus Master
Fund, Ltd., to vote all of the outstanding shares of Company common stock that
it owns in favor of the approval and adoption of (i) the purchase agreement, as
amended from time to time (the "Purchase Agreement") governing the Asset Sale,
(ii) an amendment to the Company's certificate of incorporation to change the
Company's name (the "Amendment"), (iii) any motion for adjournment or
postponement of the meeting of the Company's stockholders to approve the Asset
Sale to another time or place to permit, among other things, further
solicitation of proxies if necessary to establish a quorum or to obtain
additional votes in favor of the Purchase Agreement and the transactions
contemplated thereby and the Amendment, (iv) against any other third-party
acquisition proposal or any negotiations or discussions with respect to a
third-party acquisition proposal and against any proposal for action or
agreement that would result in a breach of any covenant, representation or
warranty or any other obligation or agreement of the Company under the Purchase
Agreement or any amendment to the Company's Certificate of Incorporation or
Bylaws, which in the case of each of the matters referred to in this clause (iv)
that could reasonably be expected to impede, interfere with, delay, postpone or
materially adversely affect the transactions contemplated by the Purchase
Agreement or the likelihood of such transactions being consummated and (v) in
favor of any other matter reasonably necessary for consummation of the
transactions contemplated by the Purchase Agreement and related agreements which
is considered at any such meeting of stockholders or in such consent, and in
connection therewith to execute any documents which are reasonably necessary in
order to effectuate the foregoing. Laurus Master Fund, Ltd.'s obligations under
the Voting Agreement are subject to customary conditions, including, among other
things, approval of the Asset Sale by the Company's board of directors.
Under the Voting Agreement, Laurus Master Fund, Ltd. revoked all
prior proxies or powers of attorney that it or certain of its affiliates had
given with respect to the Existing Shares, the Note Shares and any other shares
of common stock of the Company. Laurus Master Fund, Ltd. also generally agreed,
subject to a number of limited exceptions, to not, directly or indirectly, (i)
sell, assign, transfer, encumber, pledge or otherwise dispose of, or enter into
any contract, option or other agreement, arrangement or understanding with
respect to the direct or indirect sale, assignment, transfer, encumbrance,
pledge or other disposition of, any of the shares of Company common stock, (ii)
grant any proxies or enter into any voting trust or other agreement, arrangement
or understanding with respect to the voting of any of the shares of Company
common stock held by Laurus Master Fund, Ltd. and certain of its affiliates and
(iii) solicit any sale, assignment, transfer, encumbrance, pledge or other
disposition of the shares of Company common stock to anyone other than its
affiliates. Laurus Master Fund, Ltd. also agreed to notify STI promptly (but in
any event, within 24 hours), and it and its affiliates shall provide all details
requested by STI, if Laurus Master Fund, Ltd. or certain of its affiliates shall
be approached or solicited, directly or indirectly, by any person with respect
to any of the foregoing actions described in clause (iii) of the immediately
preceding sentence.
-8-
Laurus Master Fund, Ltd. also entered into a stock redemption
agreement, dated as of January 12, 2006 (the "Redemption Agreement"), pursuant
to which the Company agreed to purchase the Existing Shares and the Note Shares
for a purchase price per share to be determined pursuant to a formula set forth
in the Redemption Agreement, which purchase price shall not be less than $.20
per share or more than $.34 per share. Such purchase is subject to customary
closing conditions, including, among other things, the consummation of the Asset
Sale. Under the Redemption Agreement, Laurus Master Fund similarly agreed,
subject to a number of limited exceptions, to not (i) directly or indirectly,
sell, assign, transfer, encumber, pledge or otherwise dispose of, or enter into
any contract, option or other agreement, arrangement or understanding with
respect to the direct or indirect sale, assignment, transfer, encumbrance,
pledge or other disposition of, any of its shares of Company common stock and
(ii) seek or solicit any sale, assignment transfer, encumbrance, pledge or other
disposition of its shares of Company common stock to any third party.
Under the Redemption Agreement, Laurus Master Fund, Ltd. also agreed
to the cancellation, as of the closing date of the Asset Sale, of the then
unexercised portion of the following warrants that it holds: (i) the warrant,
dated November 25, 2003, to purchase up to 4,250,000 shares of common stock of
the Company at an exercise price of $0.30 per share, which warrant expires on
November 24, 2010 and (ii) the warrant, dated November 26, 2004, to purchase up
to 500,000 shares of common stock of the Company at an exercise price of $0.30
per share, which warrant expires on November 26, 2011 (collectively, the
"Warrants"). Laurus Master Fund, Ltd. further agreed not to exercise the
Warrants before the earlier of (x) March 31, 2006 and (y) the date on which the
Purchase Agreement is terminated.
Concurrently, with the execution of the Voting Agreement, the
Redemption Agreement and the Conversion Agreement, Laurus Master Fund, Ltd. also
entered into (i) a letter agreement, dated as of January 12, 2006 (the "Cash
Collateral Deposit Letter"), with the Company and its subsidiaries, Tidel
Engineering, L.P., Tidel Cash Systems, Inc., Tidel Services, Inc. and AnyCard
International, Inc., and (ii) a reaffirmation, ratification and confirmation
agreement, dated as of January 12, 2006 (the "Reaffirmation Agreement"), with
the Company. Pursuant to the Cash Collateral Deposit Letter, the parties thereto
agreed that a portion of the $8,200,000 of proceeds (the "Deposit Amount") from
the January 2006 sale of the Company's automated teller machine business that
were on deposit with Laurus Master Fund, Ltd. for repayment of outstanding
Company indebtedness to Laurus Master Fund, Ltd. would be applied to repay all
amounts owing to Laurus Master Fund, Ltd. under (i) the portion of the 2003 Note
remaining after the Conversion, (ii) a convertible term note, dated November 26,
2004 in the aggregate principal amount of $600,000, which was convertible into
shares of common stock of the Company at a conversion price of $0.30 per share
and (iii) a convertible term note, dated November 26, 2004, in the aggregate
principal amount of $1,500,000, which was convertible into shares of common
stock of the Company at a conversion price of $3.00 per share (collectively, the
"Notes"). Thereafter, the Notes shall be deemed to have been indefeasibly repaid
and the Deposit Amount will be reduced to $5,330,507. Under the Cash Collateral
Deposit Letter, such remaining Deposit Amount together with an cash additional
deposit of $69,493 from the Company will be used as collateral to secure the
Company's obligations to Laurus Master Fund, Ltd. under, among other things, the
Redemption Agreement and the Conversion Agreement.
Pursuant to the Reaffirmation Agreement, the Company, among other
things, acknowledged and reaffirmed its obligation to pay to Laurus Master Fund,
Ltd. simultaneously with the closing of the Asset Sale the amounts payable to
Laurus Master Fund pursuant to Section 4 of the Agreement Regarding NCR
Transaction and Other Asset Sales, dated as of November 26, 2004, between the
Company and Laurus Master Fund, Ltd., which amount will be determined in
accordance with the provisions of such section and shall not be less than
$5,000,000 nor more than $11,000,000.
-9-
This summary of the terms of the Conversion Agreement, the
Voting Agreement, the Redemption Agreement, the 2003 Note, the 2004 Note, the
2003 Warrant and the 2004 Warrant is qualified in its entirety by reference to
the forms of such agreements filed as exhibits hereto.
Item 7. Material to be Filed as Exhibits.
Exhibit 1 Common Stock Purchase Warrant issued to Laurus
Master Fund, Ltd. dated November 25, 2003
(incorporated by reference to Exhibit 4.42 to the
Company's Annual Report on Form 10-K for the fiscal
year ended September 30, 2002, filed February 1,
2005).
Exhibit 2 Common Stock Purchase Warrant issued to Laurus
Master Fund, Ltd. dated November 26, 2004
(incorporated by reference to Exhibit 10.4 of the
Company's Current Report on Form 8-K dated November
26, 2004).
Exhibit 3 Convertible Term Note in favor of Laurus Master
Fund, Ltd. in the principal amount of $6,450,000
dated November 25, 2003 (incorporated by reference to
Exhibit 4.35 to the Company's Annual Report on Form
10-K for the fiscal year ended September 30, 2002,
filed February 1, 2005).
Exhibit 4 Convertible Term Note in favor of Laurus Master
Fund, Ltd. in the principal amount of $600,000 dated
November 26, 2004 (incorporated by reference to
Exhibit 10.2 of the Company's Current Report on Form
8-K dated November 26, 2004).
Exhibit 5 Convertible Term Note in favor of Laurus Master Fund,
Ltd. in the principal amount of $1,500,000 dated
November 26, 2004 (incorporated by reference to Exhibit
10.3 of the Company's Current Report on Form 8-K dated
November 26, 2004).
Exhibit 6 Exercise and Conversion Agreement, dated as of
January 12, 2006, by and among the Company, Sentinel
Technologies, Inc., Sentinel Operating, L.P., and Laurus
Master Fund, Ltd.
Exhibit 7 Voting Agreement, dated as of January 12, 2006, by and
among the Company, Sentinel Technologies, Inc., Sentinel
Operating, L.P., and Laurus Master Fund, Ltd.
Exhibit 8 Stock Redemption Agreement, dated as of January 12,
2006, between the Company and Laurus Master Fund, Ltd.
Exhibit 9 Cash Collateral Deposit Letter, dated as of January 12,
2006, by and among Laurus Master Fund, Ltd., the
Company, Tidel Engineering, L.P., Tidel Cash Systems,
Inc., Tidel Services, Inc. and AnyCard International,
Inc.
Exhibit 10 Reaffirmation, Ratification and Confirmation Agreement,
dated as of January 12, 2006, between the Company and
Laurus Master Fund, Ltd.
-10-
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
January 17, 2006
LAURUS MASTER FUND, LTD.
/s/ Eugene Grin
-------------------------
Eugene Grin
Director
ATTENTION: INTENTIONAL MISSTATEMENTS OR OMISSIONS OF FACT CONSTITUTE FEDERAL
CRIMINAL VIOLATIONS (SEE 18 U.S.C. 1001).
-11-
APPENDIX A
A. Name of business, state of
organization, principal
business and address
thereof, and address
of its principal office: Laurus Capital Management, LLC,
Delaware limited liability company
controls Laurus Master Fund, Ltd.
c/o Laurus Capital Management, LLC
825 Third Avenue, 14th Floor
New York, New York 10022
B. Name: Eugene Grin
Business
Address: 825 Third Avenue, 14th Floor
New York, New York 10022
Principal Director of Laurus Master Fund, Ltd.
Occupation: Principal of Laurus Capital Management, LLC
Name of business,
principal business and
address of corporation or
other organization in
which such employment
is conducted: Laurus Master Fund, Ltd., investments in
public companies
c/o Laurus Capital Management, LLC
825 Third Avenue, 14th floor
New York, New York 10022
C. Name: David Grin
Business:
Address: 825 Third Avenue, 14th Floor
New York, New York 10022
Principal Director of Laurus Master Fund, Ltd.
Occupation: Principal of Laurus Capital Management, LLC
Name of business,
principal business and
address of corporation or
other organization in
which such employment
is conducted: Laurus Master Fund, Ltd., direct investments
in companies
c/o Laurus Capital Management, LLC
825 Third Avenue, 14th Floor
New York, New York 10022
-12-
Each of Laurus Capital Management, LLC, Eugene Grin and David Grin hereby agree,
by their execution below, that the Schedule 13D to which this Appendix A is
attached is filed on behalf of each of them, respectively.
Laurus Capital Management, LLC
/s/ Eugene Grin
------------------------------
Eugene Grin
Principal
January 17, 2006
/s/ Eugene Grin
------------------------------
Eugene Grin, individually
January 17, 2006
/s/ David Grin
------------------------------
David Grin, individually
January 17, 2006
-13-
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
Exhibit 1 Common Stock Purchase Warrant issued to Laurus Master Fund,
Ltd. dated November 25, 2003 (incorporated by reference to
Exhibit 4.42 to the Company's Annual Report on Form 10-K for
the fiscal year ended September 30, 2002, filed February 1,
2005).
Exhibit 2 Common Stock Purchase Warrant issued to Laurus Master Fund,
Ltd. dated November 26, 2004 (incorporated by reference to
Exhibit 10.4 of the Company's Current Report on Form 8-K dated
November 26, 2004).
Exhibit 3 Convertible Term Note in favor of Laurus Master Fund, Ltd. in
the principal amount of $6,450,000 dated November 25, 2003
(incorporated by reference to Exhibit 4.35 to the Company's
Annual Report on Form 10-K for the fiscal year ended September
30, 2002, filed February 1, 2005).
Exhibit 4 Convertible Term Note in favor of Laurus Master Fund, Ltd. in
the principal amount of $600,000 dated November 26, 2004
(incorporated by reference to Exhibit 10.2 of the Company's
Current Report on Form 8-K dated November 26, 2004).
Exhibit 5 Convertible Term Note in favor of Laurus Master Fund,
Ltd. in the principal amount of $1,500,000 dated
November 26, 2004 (incorporated by reference to Exhibit
10.3 of the Company's Current Report on Form 8-K dated
November 26, 2004).
Exhibit 6 Exercise and Conversion Agreement, dated as of
January 12, 2006, by and among the Company, Sentinel
Technologies, Inc., Sentinel Operating, L.P., and Laurus
Master Fund, Ltd.
Exhibit 7 Voting Agreement, dated as of January 12, 2006, by and
among the Company, Sentinel Technologies, Inc., Sentinel
Operating, L.P., and Laurus Master Fund, Ltd.
Exhibit 8 Stock Redemption Agreement, dated as of January 12,
2006, between the Company and Laurus Master Fund, Ltd.
Exhibit 9 Cash Collateral Deposit Letter, dated as of January 12,
2006, by and among Laurus Master Fund, Ltd., the
Company, Tidel Engineering, L.P., Tidel Cash Systems,
Inc., Tidel Services, Inc. and AnyCard International,
Inc.
Exhibit 10 Reaffirmation, Ratification and Confirmation Agreement,
dated as of January 12, 2006, between the Company and
Laurus Master Fund, Ltd.
-14-