**Exhibit 10.1**

 

**AXCESS INC.**

**3208 Commander Drive**

**Carrollton, Texas  75006**

 

May 15, 2003

 

 

 

 

 

**Re:          StockPurchase Agreement**

 

Ladies and Gentlemen:

 

This Agreementsets forth the terms and conditions on which AXCESS Inc., a DelawareCorporation, of 3208 Commander Drive, Carrollton, Texas, 75006 (the “Company”)will issue and sell to                              ,of                                                    (the “Purchaser”) shares of Series 2003 Preferred Stock of the Company, parvalue $0.01 per share (*the “Preferred”)*and Series 2003 Warrants (*the “Warrants”)*which provide the right to purchase shares of the Company’s Common Stock.

 

1.             Type of Security and PurchasePrice.  The Purchaser hereby agreesto subscribe for and purchase from the Company, and the Company hereby agreesto issue and sell to the Purchaser,             Units,each Unit consisting of 100,000 Preferred and 100,000 Warrants.  The purchase price for each Unit shall be$75,000, payable in cash.  Preferred shares shall bear dividends at 7%annually paid in arrears, payable in cash or in kind at the option of thecompany. The Warrants shall have an exercise life of two years and the exerciseprice of the warrants is $1.00. The purchase and sale of each Unithereunder shall be effective as of the date the Company receives the purchaseprice for each Unit from the Purchaser (the “*Effective Date*”).

 

2.             Purchase Dates and Delivery ofShares.  The Company wishes to closeon the sale of up to $1 million of Units on April 18, 2003 and May 2, 2003.  For investors closing on or before the first closing of April 18, 2003,15,000 additional restricted common shares will be awarded per $75,000invested. Upon its receipt of the purchase price for each Unit, theCompany shall issue and sell to the Purchaser the number of Preferred andWarrants based on paragraph 1 above. On and as of the Effective Date, theCompany shall execute and deliver to the Purchaser stock and warrantcertificates in proper form representing the Shares.

 

3.             Conversion and Lock-up of Series2003 Preferred Stock to  Common Stock.When the Companyachieves a full quarter of profitability (EBIDTA) or when the share pricesurpasses $2.00 based on the average closing price for the 20 trading dayspreceding, the preferred shares shall be converted on a one to one basis intocommon stock, $0.01 par value per share.  Purchaser shall not tosell more than 1/6 of the common shares issued to them in connection with thisoffering in any calendar month.

 

4.             Securities ActLegend; Registration Rights.

 

4.1         The Shares will not beregistered under the Securities Act of 1933, as amended (the “*SecuritiesAct*”).  The Company will use reasonable efforts toregister the common shares offered in this offering within 60 days of the closeof the offering or as soon as practicable thereafter. Prior to registration, certificatesrepresenting the Shares shall bear a restrictive legend substantially to theeffect of the following:

 

THE SECURITIESREPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,OR APPLICABLE STATE SECURITIES LAWS, OR THE SECURITIES LAWS OF ANY OTHERJURISDICTION.  THEY MAY NOT BE SOLD ORTRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THOSESECURITIES LAWS OR PURSUANT TO AN EXEMPTION THEREFROM.  ADDITIONAL RESTRICTIONS REGARDING THE TERMSUNDER WHICH THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE CONVERTED INTONON-VOTING COMMON STOCK OF THE COMPANY ARE SET FORTH IN THE CERTIFICATE OFDESIGNATIONS, PREFERENCES, POWERS AND RIGHTS OF THE SERIES 2003 PREFERREDSTOCK.

 

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5.             Representations and Warrantiesby the Company.  The Company herebyrepresents and warrants to the Purchaser as follows:

 

5.1           The Company is a corporation dulyorganized, validly existing and in good standing under the laws of the State ofDelaware, and has the corporate power and authority to execute and deliver thisAgreement, to issue the Shares on the basis described herein and otherwise toperform its obligations under this Agreement.

 

5.2           The execution and delivery by theCompany of this Agreement, the issuance of the Shares, and the performance bythe Company of its obligations hereunder, have been duly authorized by allrequisite corporate action on the part of the Company and will not (i) violateany provision of law, statute, rule or regulation or any order of any court orother agency of government, (ii) conflict with or violate the Certificate ofIncorporation (after amendment to authorize the additional shares of non-votingcommon stock) or By-Laws of the Company, in each case as amended, or(iii) violate, conflict with or constitute (with due notice or lapse oftime or both) a default under any indenture, mortgage, lease, license,agreement or other contract or instrument or result in the creation or impositionof any lien, charge or encumbrance of any nature upon the properties or assetsof the Company or any of its subsidiaries, in each case if such violation,conflict, default, lien, charge or encumbrance would have a material adverseeffect on the Company.

 

5.3           This Agreement has been duly executedand delivered by the Company and constitutes the valid and legally bindingobligation of the Company, enforceable in accordance with its terms, except tothe extent the enforceability hereof may be limited by applicable bankruptcy,moratorium or similar laws affecting the rights of creditors generally.

 

5.4           Based in part upon therepresentations and warranties of the Purchaser contained in this Agreement, noregistration or filing with, or consent or approval of, or other action by, anyfederal, state or other governmental department, commission, board, bureau,agency or instrumentality or any third party is or will be necessary for theexecution and delivery of this Agreement by the Company and the issuance of theShares hereunder, other than the filing of a notice of sale on Form D with theSecurities and Exchange Commission and any other required jurisdictions inaccordance with the rules and regulations thereof under the Securities Act andapplicable state law.

 

5.5           The Preferred Shares are dulyauthorized, validly issued, fully paid and non-assessable shares of Series 2003Preferred Stock, and are not subject to any preemptive rights.

 

5.6           Attached hereto as Exhibit Ais a true copy of the Certificate of Designations, Preferences, Powers andRights of Series 2003 Preferred Stock, to be filed with the Secretary of Stateof the State of Delaware (the *“Series 2003 Certificate of Designations”*).  The Board of Directors of the Company hasapproved and adopted resolutions creating the Preferred Shares, Common Shares,and Warrants and directing the proper officers of the Company to file the samewith the office of the Secretary of State of the State of Delaware, inaccordance with the applicable provisions of the Delaware General CorporationLaw.

 

6.                                       Representationsand Warranties of the Purchaser. The Purchaser hereby represents and warrants to the Company as follows:

 

6.1           The Purchaser is acquiring the Sharesfor its own account, for investment and not with a view to the distributionthereof within the meaning of the Securities Act.

 

6.2           The Purchaser understands that theShares have not been registered under the Securities Act, by reason of theirissuance by the Company in transactions exempt from the registration requirementsof the Securities Act, and that the Common shares must be held by the Purchaseruntil registered under the Securities Act.

 

6.3           The Purchaser further understandsthat the exemption from registration afforded by Rule 144 (the provisions ofwhich are known to it) promulgated under the Securities Act depends on thesatisfaction of various conditions, and that, if applicable, Rule 144 mayafford the basis for sales only in limited amounts, after compliance with theholding periods and other provisions thereof.

 

6.4           The Purchaser understands that itsinvestment hereunder involves substantial risks and represents and warrantsthat it has made such independent examinations and investigations of theCompany as it has deemed necessary in making its investment decision, and thePurchaser further represents and warrants that it has had sufficient access tothe officers, directors, books and records of the Company as it has deemednecessary to conduct such examination and investigation and make suchinvestment decision.  Purchaser agreesto keep confidential the confidential information provided for the purpose ofevaluating the purchase herein.

 

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6.5           The Purchaser is a qualified investorable to bear the economic risk of the investment contemplated by this Agreementand has such knowledge and experience in financial and business matters that itis capable of evaluating the merits and risks of the investment contemplated bythis Agreement.

 

7.             Reaffirmation of Representationsand Warranties.  The date Units arepurchased shall constitute a reaffirmation of each and every one of therepresentations and warranties of the Company set forth in Section 5 of thisAgreement and those of the Purchaser set forth in Section 6 of this Agreementas if made as of each Effective Date, unless otherwise restated or corrected byeither the Purchaser or the Company, as the case may be.

 

8.             Miscellaneous.

 

8.1           This Agreement constitutes our entireagreement with respect to the subject matter hereof.   This Agreement may not be modified or amended or any provisionhereof waived except by an instrument in writing signed by the Company and thePurchaser.

 

8.2           This Agreement shall be binding uponand inure to the benefit of the parties hereto and their respective successorsand permitted assigns.  The rights ofthe Purchaser hereunder shall be assignable to any holder of the Shares.  Except as provided in the immediatelypreceding sentence, this Agreement and the rights of the Purchaser hereundershall not be assignable, and any purported assignment hereof or thereof shallbe void.

 

8.3           This Agreement may be executed in anynumber of counterparts and on separate counterparts, each of which shall be anoriginal instrument, but all of which together shall constitute a singleagreement.  One or more signature pagesfrom any counterpart of this Agreement may be attached to any other counterpartof this Agreement without in any way changing the effect thereof.  This Agreement shall be effective when executedand delivered by the Company and the Purchaser.

 

8.4           All notices, requests, demands,consents, waivers, or other communications made hereunder to any party orholder of Shares shall be in writing and shall be deemed to have been dulygiven if delivered personally or sent by nationally-recognized overnightcourier, facsimile or by first class registered or certified mail, returnreceipt requested, postage prepaid, addressed to such party at the address setforth below:

 

if to theCompany, to:

 

AXCESS Inc.

3208 Commander Drive

Carrollton, TX  75006

Attention: Chief Financial Officer

 

with a copy to:

 

Haynes and Boone, LLP

901 Main Street, Suite 3100

Dallas, TX 75202-3789

Attention: William Kleinman.; and

 

if to thePurchaser, to the Purchaser at its address first set forth above,or to suchother address as the party to whom such communication is to be given may havefurnished to the other party in writing in accordance herewith.  All such notices, requests, demands,consents, waivers or other communications shall be deemed to have beendelivered (i) in the case of personal delivery, on the date of delivery,(ii) if sent by facsimile, on the date sender receives a confirmationconfirming receipt, (iii) if sent by overnight courier, on the next business dayfollowing the date sent and (iv) in the case of mailing, on the third businessday following such mailing.

 

8.5                                 Allrepresentations, warranties and agreements contained herein shall survive theexecution and delivery of this Agreement and the sale of the Shares hereunder.

 

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8.6           This Agreement, and all rights,obligations and liabilities hereunder, shall be construed according to the lawsof the State of Texas applicable to contracts made and to be performed whollytherein.  Any judicial proceedingbrought against the Company to enforce, or otherwise in connection with, thisAgreement may be brought in any court of competent jurisdiction in the City ofNew York, and, by execution and delivery of this Agreement, the Company (i)accepts, generally and unconditionally, the nonexclusive jurisdiction of suchcourts and any related appellate court and irrevocably agrees to be bound byany final judgment rendered thereby in connection with this Agreement and (ii)irrevocably waives any objection it may now or hereafter have as to the venueof any such proceeding brought in such a court or that such a court is aninconvenient forum.

 

*Intentionally Left Blank*

 

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If theforegoing correctly sets forth your understanding of our agreement, please soindicate by signing and returning to the Company the enclosed counterpart ofthis Agreement.

 
|                                                                                                              | Very truly yours,                                        |
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|                                                                                                              | AXCESS INC.                                              |
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|                                                                                                              |                                                     |
|                                                                                                              | By:                                                      |   |   |
|                                                                                                              |  Allan Frank, Chief Financial Officer and Secretary |
|                                                                                                              |                                                     |
| The  undersigned agrees with and  accepts the foregoing terms and provisions  as of the date first above written. |                                                     |
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| By:                                                                                                               |                                                     | , |   |
|                                                                                                                   |                                                          |  |  |  |  |

 

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