Exhibit 10.1


 


AGREEMENT
TO AMEND PURCHASE NOTE AND PAYMENT TERMS


 


This Agreement to Amend Purchase Note and Payment
Terms (this “Agreement”)
is made as of December        , 2003, by and
between AXCESS International, Inc., a Delaware corporation (the “Company”), and PV
Proceeds Holdings, Inc., a Delaware corporation (“Proceeds”).


 


RECITALS


 


A.            The Company issued to Proceeds that certain Purchase Note
on July 28, 1999 (the “Original
Note”) having a principal amount of Four Million Dollars
($4,000,000.00) and, in connection therewith, the Company and Proceeds entered
into that certain Security Agreement made and dated the 28th day of July, 1999
(the “Security Agreement”),
pursuant to which the Company assigned its interests in that certain
Subordinated Promissory Note issued by Amphion Ventures, L.P. on April 30, 1999
in favor of the Company (the “Collateral”) and granted a security interest in the
Collateral to Proceeds.


 


B.            The Company has raised approximately $2,500,000 and is
seeking to raise additional funds (together, the “Financing”) and has proposed to
restructure certain outstanding debts and obligations with its creditors and
debtors (the “Restructuring”).


 


C.            As part of and in order to facilitate the Restructuring,
the Company and Proceeds desire to enter into this Agreement to (i) amend the
terms of the Original Note, (ii) release and reassign to the Company any and
all interest held by Proceeds in the Collateral, and (iii) set forth certain of
the other terms and conditions agreed upon in connection with the
Restructuring.


 


AGREEMENT


 


NOW THEREFORE, in consideration of the foregoing and
the mutual covenants contained herein, the parties hereto agree as follows:


 


1.             Modification
Fee.  In consideration of Proceeds
entering into this Agreement and the amendment of the Original Note, and not as
payment on any portion of the principal amount of the Original Note or the
Amended Note (as defined below), upon execution of this Agreement the Company
shall deliver to Proceeds the amount of Twenty-Five Thousand Dollars
($25,000.00) (the “Modification
Fee”).  Payment of the
Modification Fee shall be made by the Company to Proceeds by delivery of cash,
check or by wire transfer.


 


2.             Amendment
of Purchase Note.  The Company and
Proceeds hereby agree to amend and restate the Original Note in substantially
the form attached hereto as Exhibit A (the “Amended Note”).  Upon execution of this Agreement, Proceeds
shall deliver to the Company for immediate cancellation the Original Note and
the Company shall deliver to Proceeds the executed and final Amended Note.


 


3.             Warrant
to Purchase Common Stock.  As
further consideration for entering into this Agreement and the amendment of the
Original Note, upon the execution of this Agreement


 

















 


the Company shall issue and deliver to Proceeds a warrant to purchase
up to 500,000 shares of the Common Stock of the Company (the “Common Stock”) in
substantially the form attached hereto as Exhibit B (the “Warrant”).


 


4.               Payment
of Funds.  Upon the execution of
this Agreement, the Company hereby agrees to pay to Proceeds (i) as payment on
the principal amount of the Amended Note, ten percent (10%) of the gross amount
of the first Two Million Dollars ($2,000,000) raised by the Company (after
deducting brokerage fees, finder’s fees or other similar underwriting
commissions) in connection with the Financing, (ii) as payment on the principal
amount of the Amended Note and any interest accrued thereon, fifteen percent
(15%) of the gross amount of all funds exceeding Two Million Dollars ($2,000,000)
raised by the Company (after deducting brokerage fees, finder’s fees or other
similar underwriting commissions) in connection with the Financing prior to
December 31, 2003, and (iii) as payment on the principal amount of the Amended
Note and any interest accrued thereon, ten percent (10%) of the gross amount of
any and all additional funds raised by the Company (after deducting brokerage
fees, finder’s fees or other similar underwriting commissions) from any
Financings now or in the future, until such time as Proceeds has received from
the Company payment in full of the principal amount of the Amended Note and all
interest accrued thereon.


 


5.             Release
of Security Interest.  Upon the
execution of this Agreement and the performance by the Company of its obligations
set forth in Sections 1-4 above, Proceeds shall execute and deliver to the
Company a Reassignment and Release of Security Interest in substantially the
form attached hereto as Exhibit C (the “Release”).


 


6.             Additional
Proceeds.  The Company hereby agrees
to pay to Proceeds, as payment on the principal amount of the Amended Note and
any interest accrued thereon, twenty percent (20%) of the net proceeds received
by the Company in connection with the exercise of any options to purchase
shares of the Company’s capital stock or the exercise or conversion of any
warrants to purchase shares of the Company’s capital stock.


 


7.             Conversion
of Preferred Stock.  As set forth in
that certain Letter Agreement dated October 10, 2003 by and between the Company
and Proceeds, a copy of which is attached hereto as Exhibit D (the “Letter Agreement”),
Proceeds has agreed to and permitted the conversion of all shares of the
Preferred Stock of the Company (“Preferred Stock”) owned by Proceeds into
shares of Common Stock.  If the shares
of Common Stock are converted back into Preferred Stock as provided for in the
Letter Agreement, the conversion price of such reissued shares of Preferred
Stock into shares of Common Stock shall again be $2.50 per share.


 


8.             Entire
Agreement.  This Agreement, together
with the Exhibits attached hereto, sets forth the entire agreement of the
parties hereto with respect to the subject matter hereof.


 


9.             Governing
Law.  This Agreement shall be
governed by, and construed and enforced in accordance with, the laws of the
State of Delaware.


 


10.           Facsimile.  This Agreement may be executed by facsimile
and in any number of counterparts by the parties hereto all of which together
shall constitute one instrument.


 


2

















 


IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first written above.


 


	
   

  	
  AXCESS
  INTERNATIONAL, INC., 

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ ALLAN L. FRANK

  	
   

  
	
   

  	
  Name:

  	
   

  	
  Allan L. Frank

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Chief Financial Officer
  and Secretary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PV
  PROCEEDS HOLDINGS, INC.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ MICHAEL S. DREYER

  	
   

  
	
   

  	
  Name:

  	
   

  	
  Michael S. Dreyer 

  	
   

  
	
   

  	
  Title:

  	
   

  	
  Assistant Secretary 

  	
   

  
								



 


3

















 


EXHIBIT
A


 


Amended and Restated
Purchase Note


 


4

















 


EXHIBIT
B


 


Warrant to Purchase
Common Stock


 


5

















 


EXHIBIT
C


 


Reassignment and Release
Agreement


 


6

















 


EXHIBIT
D


 


Letter Agreement


 


7