EXHIBIT 4.04

                            PATENT SECURITY AGREEMENT

      WHEREAS, TIDEL ENGINEERING, INC., a Delaware corporation ("GRANTOR"), owns
the patents, patent registrations, and patent applications listed on SCHEDULE 1
annexed hereto, and is a party to, or has been assigned the rights by the party
to, the patent licenses listed on SCHEDULE 1 annexed hereto; and

      WHEREAS, Grantor and Texas Commerce Bank National Association, a national
banking association ("GRANTEE"), are parties to that certain Credit Agreement
dated as of the date hereof (as heretofore or hereafter amended, modified and in
effect from time to time, the "LOAN AGREEMENT"), providing for extensions of
credit to be made by Grantee to Grantor; and

      WHEREAS, pursuant to the terms of the Security Agreement (as defined in
the Loan Agreement), Grantor has granted to Grantee a security interest in all
of the assets of Grantor including all right, title and interest of Grantor in,
to and under all now owned and hereafter acquired patents and patent
applications, and all products and proceeds thereof, to secure the payment of
all amounts owing by Grantor under the Loan Agreement including, without
limitation, all the Obligations (as defined in the Loan Agreement);

      NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor does hereby grant to
Grantee a continuing security interest in all of Grantor's right, title and
interest in, to and under the following (all of the following items or types of
property being herein collectively referred to as the "PATENT COLLATERAL"),
whether presently existing or hereafter created or acquired:

            (1) each patent, patent registration and patent application,
            including, without limitation, the patents, patent registrations
            (together with any reissues, continuations or extensions thereof)
            and patent applications referred to in SCHEDULE 1 annexed hereto;
            
            (2) each patent license, including, without limitation, each patent
            license listed on SCHEDULE 1 annexed hereto; and 

            (3) all products and proceeds of the foregoing, including, without
            limitation, any claim by Grantor against third parties for past,
            present or future infringement of any patent or patent registration
            including, without limitation, the patents and patent registrations
            referred to in SCHEDULE 1 annexed hereto, the patent registrations
            issued with respect to the patent applications referred in SCHEDULE
            1 and the patents licensed under any patent license. 
            
This security interest is granted in conjunction with the security interests
granted to Grantee pursuant to the Loan Agreement. Grantor hereby acknowledges
and affirms that the rights and remedies of Grantee with respect to the security
interest in the Patent Collateral made and granted hereby are more 

fully set forth in the Loan Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein.

      IN WITNESS WHEREOF, Grantor has caused this Patent Security Agreement to
be duly executed by its duly authorized officer thereunto as of the 12th day of
June, 1997.

                                       GRANTOR:

                                       TIDEL ENGINEERING, INC.,
                                       a Delaware corporation

                                       By:  /S/ MARK K. LEVENICK
                                       Name:  Mark K. Levenick
                                       Title: President

Acknowledged, agreed and accepted
as of the date hereof:

GRANTEE:

TEXAS COMMERCE BANK NATIONAL ASSOCIATION

By:  /S/ JEFFREY A. STERN
Name:  Jeffrey A. Stern
Title:  Vice President

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