EXHIBIT 10.53

ACCERIS COMMUNICATIONS INC.

SECURITIES PURCHASE AGREEMENT

October 14, 2004

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TABLE OF CONTENTS

                  Page 1.  
Agreement to Sell and Purchase
  1 2.  
Fees and Warrant
  1 3.  
Closing, Delivery and Payment
  2    
3.1 Closing
  2    
3.2 Delivery
  2 4.  
Representations and Warranties of the Company
  2    
4.1 Organization, Good Standing and Qualification
  2    
4.2 Subsidiaries
  3    
4.3 Capitalization; Voting Rights
  3    
4.4 Authorization; Binding Obligations
  4    
4.5 Liabilities
  5    
4.6 Agreements; Action
  5    
4.7 Obligations to Related Parties
  5    
4.8 Changes
  6    
4.9 Title to Properties and Assets; Liens, Etc
  7    
4.10 Intellectual Property
  8    
4.11 Compliance with Other Instruments
  8    
4.12 Litigation
  9    
4.13 Tax Returns and Payments
  9    
4.14 Employees
  9    
4.15 Registration Rights and Voting Rights
  10    
4.16 Compliance with Laws; Permits
  10    
4.17 Environmental and Safety Laws
  10    
4.18 Valid Offering
  11    
4.19 Full Disclosure
  11    
4.20 Insurance
  11    
4.21 SEC Reports
  11    
4.22 Listing
  12    
4.23 No Integrated Offering
  12    
4.24 Stop Transfer
  12

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TABLE OF CONTENTS
(Continued)

                  Page    
4.25 Dilution
  12    
4.26 Patriot Act
  12 5.  
Representations and Warranties of the Purchaser
  13    
5.1 No Shorting
  13    
5.2 Requisite Power and Authority
  13    
5.3 Investment Representations
  13    
5.4 Purchaser Bears Economic Risk
  14    
5.5 Acquisition for Own Account
  14    
5.6 Purchaser Can Protect Its Interest
  14    
5.7 Accredited Investor
  14    
5.8 Legends
  14 6.  
Covenants of the Company
  15    
6.1 Stop-Orders
  15    
6.2 Listing
  15    
6.3 Market Regulations
  16    
6.4 Reporting Requirements
  16    
6.5 Use of Funds
  16    
6.6 Access to Facilities
  16    
6.7 Taxes
  16    
6.8 Insurance
  17    
6.9 Intellectual Property
  18    
6.10 Properties
  18    
6.11 Confidentiality
  18    
6.12 Required Approvals
  18    
6.13 Reissuance of Securities
  19    
6.14 Opinion
  19    
6.15 Margin Stock
  19 7.  
Covenants of the Purchaser
  20    
7.1 Confidentiality
  20    
7.2 Non-Public Information
  20

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TABLE OF CONTENTS
(Continued)

                  Page 8.  
Covenants of the Company and Purchaser Regarding Indemnification
  20    
8.1 Company Indemnification
  20    
8.2 Purchaser’s Indemnification
  20 9.  
Conversion of Convertible Note
  20    
9.1 Mechanics of Conversion
  20 10.  
Registration Rights
  22    
10.1 Registration Rights Granted
  22 11.  
Miscellaneous
  22    
11.1 Governing Law
  22    
11.2 Survival
  22    
11.3 Successors
  23    
11.4 Entire Agreement
  23    
11.5 Severability
  23    
11.6 Amendment and Waiver
  23    
11.7 Delays or Omissions
  23    
11.8 Notices
  23    
11.9 Attorneys’ Fees
  24    
11.10 Titles and Subtitles
  25    
11.11 Facsimile Signatures; Counterparts
  25    
11.12 Broker’s Fees
  25    
11.13 Construction
  25

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LIST OF EXHIBITS

     
Form of Convertible Term Note
  Exhibit A
Form of Warrant
  Exhibit B
Form of Escrow Agreement
  Exhibit C

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THIS AGREEMENT IS SUBJECT TO THE TERMS AND PROVISIONS OF (i) THAT CERTAIN
INTERCREDITOR AGREEMENT DATED OF EVEN DATE HEREWITH BY AND AMONG THE COMPANY,
THE PURCHASER AND WELLS FARGO FOOTHILL, INC. AND (ii) ANY REPLACEMENT OR
SUCCESSOR INTERCREDITOR AGREEMENT WITH ANY REPLACEMENT OR SUCCESSOR SENIOR
CREDITOR.

SECURITIES PURCHASE AGREEMENT

     THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made and entered
into as of October 14, 2004, by and between ACCERIS COMMUNICATIONS INC., a
Florida corporation (the “Company”), and Laurus Master Fund, Ltd., a Cayman
Islands company (the “Purchaser”).

RECITALS

     WHEREAS, the Company has authorized the sale to the Purchaser of a
Convertible Term Note in the original principal amount of Five Million Dollars
($5,000,000) (as amended, modified or supplemented from time to time, the
“Note”), which Note is convertible into shares of the Company’s common stock,
$0.01 par value per share (the “Common Stock”) at the initial fixed conversion
price per share of Common Stock as set forth in the Note (“Fixed Conversion
Price”);

     WHEREAS, the Company wishes to issue a warrant to the Purchaser to purchase
up to 1,000,000 shares of the Company’s Common Stock (subject to adjustment as
set forth therein) in connection with Purchaser’s purchase of the Note;

     WHEREAS, Purchaser desires to purchase the Note and the Warrant (as defined
in Section 2) on the terms and conditions set forth herein;

     WHEREAS, the Company desires to issue and sell the Note and Warrant to
Purchaser on the terms and conditions set forth herein;

     WHEREAS, the Company has a secured senior credit facility in place as of
the date hereof pursuant to that certain Loan and Security Agreement by and
among the Company, Acceris Communications Corp. and Wells Fargo Foothill, Inc.,
a California corporation (“Foothill”), dated as of December 10, 2001, as amended
from time to time through the date hereof (as amended through the date hereof,
the “Foothill Loan”); and

     WHEREAS, the Company and the Purchaser desire to enter into an
Intercreditor Agreement by and among the Company, the Purchaser and Foothill of
even date herewith to subordinate this Agreement, the Note and the Related
Agreements (as defined below) to the Foothill Loan,

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AGREEMENT

     NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
promises, representations, warranties and covenants hereinafter set forth and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

     1. Agreement to Sell and Purchase; Subordination.

          (a) Pursuant to the terms and conditions set forth in this Agreement,
on the Closing Date (as defined in Section 3), the Company agrees to sell to the
Purchaser, and the Purchaser hereby agrees to purchase from the Company, a Note
in the aggregate principal amount of $5,000,000 convertible in accordance with
the terms thereof into shares of the Company’s Common Stock in accordance with
the terms of the Note and this Agreement. The Note purchased on the Closing Date
shall be known as the “Offering.” A form of the Note is annexed hereto as
Exhibit A. The Note will mature on the Maturity Date (as defined in the Note).
Collectively, the Note and Warrant and Common Stock issuable in payment of the
Note, upon conversion of the Note and upon exercise of the Warrant are referred
to as the “Securities.”

          (b) The Purchaser acknowledges and agrees that this Agreement, the
Note and the other Related Agreements (as defined below) shall be subordinate to
the Foothill Loan, pursuant to that certain Intercreditor Agreement among the
Company (and/or Acceris Communications Corp.), the Purchaser and Foothill of
even date herewith (the “Foothill Intercreditor Agreement”). The term “Senior
Debt” as used herein shall refer to (i) the Foothill Loan and all obligations of
the Company and/or Acceris Communications Corp. to Foothill in connection
therewith and (ii) any replacement or successor senior credit facility of the
Company and/or Acceris Communications Corp. in the aggregate principal amount of
up to $18 million, with interest to accrue thereon at a rate not to exceed 10%
per annum. The term “Intercreditor Agreement” as used herein shall refer to
(i) the Foothill Intercreditor Agreement and (ii) the intercreditor agreement to
be entered into in connection with any subsequent Senior Debt, having
subordination and security provisions not materially more restrictive upon the
Purchaser than those contained in the Foothill Intercreditor Agreement. The term
“Senior Creditor” as used herein shall refer to (i) Foothill and (ii) any
subsequent lender of Senior Debt.

     2. Fees and Warrant. On the Closing Date:

     (a) The Company will issue and deliver to the Purchaser a Warrant to
purchase up to 1,000,000 shares of Common Stock in connection with the Offering
(as amended, modified or supplemented from time to time, the “Warrant”) pursuant
to Section 1 hereof. The Warrant must be delivered on the Closing Date. A form
of Warrant is annexed hereto as Exhibit B. All the representations, covenants,
warranties, undertakings, and indemnification, and other rights made or granted
to or for the benefit of the Purchaser by the Company hereunder are hereby also
made and granted in respect of the Warrant and shares of the Company’s Common
Stock issuable upon exercise of the Warrant (the “Warrant Shares”).

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     (b) Subject to the terms of Section 2(d) below, the Company shall pay to
Laurus Capital Management, LLC, the manager of the Purchaser, a closing payment
in an amount equal to three and nine tenths percent (3.90%) of the original
principal amount of the Note. The foregoing fee is referred to herein as the
“Closing Payment.”

     (c) The Company shall reimburse the Purchaser for its reasonable expenses
(including legal fees and expenses) incurred in connection with the preparation
and negotiation of this Agreement and the Related Agreements (as hereinafter
defined), and expenses incurred in connection with the Purchaser’s due diligence
review of the Company and its Subsidiaries (as defined in Section 4.2) and all
related matters. Amounts required to be paid under this Section 2(c) will be
paid on the Closing Date and shall not exceed $44,500 in the aggregate for such
expenses referred to in this Section 2(c).

     (d) The Closing Payment and the expenses referred to in the preceding
clause (c) (net of deposits previously paid by the Company) shall be paid at
closing out of funds held pursuant to the Escrow Agreement (as defined below)
and a disbursement letter (the “Disbursement Letter”).

     3. Closing, Delivery and Payment.

          3.1 Closing. Subject to the terms and conditions herein, the closing
of the transactions contemplated hereby (the “Closing”), shall take place on the
date hereof, at such time or place as the Company and Purchaser may mutually
agree (such date is hereinafter referred to as the “Closing Date”).

          3.2 Delivery. Pursuant to the Escrow Agreement, at the Closing on the
Closing Date, the Company will deliver to the Purchaser, among other things, a
Note in the form attached as Exhibit A representing the original principal
amount of $5,000,000 and a Warrant in the form attached as Exhibit B in the
Purchaser’s name representing 1,000,000 Warrant Shares and the Purchaser will
deliver to the Company, among other things, the amounts set forth in the
Disbursement Letter by certified funds or wire transfer.

     4. Representations and Warranties of the Company. The Company hereby
represents and warrants to the Purchaser that the representations and warranties
set forth in this Section 4 (which representations and warranties are
supplemented by the Company’s filings under the Securities Exchange Act of 1934
made prior to the date of this Agreement (collectively, the “Exchange Act
Filings”), copies of which have been provided to the Purchaser) are true,
correct and complete in all material respects as of the date hereof (except to
the extent that such representations and warranties relate solely to an earlier
date):

          4.1 Organization, Good Standing and Qualification. Each of the Company
and each of its Subsidiaries is a corporation, partnership or limited liability
company, as the case may be, duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization. Each of the Company
and each of its Subsidiaries has the corporate power and authority to own and
operate its properties and assets, and to the extent party thereto, to execute
and deliver (i) this Agreement, (ii) the Note and the Warrant to be issued in
connection with this Agreement, (iii) the Master Security Agreement dated as of
the date hereof among the Company,

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certain Subsidiaries of the Company, the Purchaser and the other parties thereto
(as amended, modified or supplemented from time to time, the “Master Security
Agreement”), (iv) the Registration Rights Agreement relating to the Securities
dated as of the date hereof between the Company and the Purchaser (as amended,
modified or supplemented from time to time, the “Registration Rights
Agreement”), (v) the Guaranty dated as of the date hereof made by certain
Subsidiaries of the Company, Counsel Corporation and certain of its affiliates
party thereto (as amended, modified or supplemented from time to time, the
“Guaranty”), (vi) the Stock Pledge Agreement dated as of the date hereof among
the Company, certain Subsidiaries of the Company, Counsel Corporation (US), a
Delaware corporation, Counsel Communications, L.L.C., a Delaware limited
liability company, and the Purchaser (as amended, modified or supplemented from
time to time, the “Stock Pledge Agreement”), (vii) the Funds Escrow Agreement
dated as of the date hereof among the Company, the Purchaser and the escrow
agent referred to therein, substantially in the form of Exhibit C hereto (as
amended, modified or supplemented from time to time, the “Escrow Agreement”) and
(viii) all other agreements related to this Agreement and the Note and referred
to herein (the preceding clauses (ii) through (viii), collectively, the “Related
Agreements”), to issue and sell the Note and the shares of Common Stock issuable
upon conversion of the Note (the “Note Shares”), to issue and sell the Warrant
and the Warrant Shares, and to carry out the provisions of this Agreement and
the Related Agreements and to carry on its business as presently conducted. Each
of the Company and each of its Subsidiaries is duly qualified and is authorized
to do business and is in good standing as a foreign corporation, partnership or
limited liability company, as the case may be, in all jurisdictions in which the
nature of its activities and of its properties (both owned and leased) makes
such qualification necessary, except for those jurisdictions in which failure to
do so has not, or could not reasonably be expected to have, individually or in
the aggregate, a material adverse effect on the business, assets, liabilities,
condition (financial or otherwise), properties, operations or prospects of the
Company, Acceris Communications Corp. and Acceris Communications Technologies,
Inc., taken individually or as a whole (a “Material Adverse Effect”).

          4.2 Subsidiaries. Each direct and indirect Subsidiary of the Company,
the direct owner of such Subsidiary and its percentage ownership thereof as of
the date hereof, is set forth on Schedule 4.2. For the purpose of this
Agreement, a “Subsidiary” of any person or entity means (i) a corporation or
other entity whose shares of stock or other ownership interests having ordinary
voting power (other than stock or other ownership interests having such power
only by reason of the happening of a contingency) to elect a majority of the
directors of such corporation, or other persons or entities performing similar
functions for such person or entity, are owned, directly or indirectly, by such
person or entity or (ii) a corporation or other entity in which such person or
entity owns, directly or indirectly, more than 50% of the equity interests at
such time.

          4.3 Capitalization; Voting Rights.

     (a) The authorized capital stock of the Company, as of the date hereof
consists of 310,000,000 shares, of which 300,000,000 are shares of Common Stock,
par value $0.01 per share, 19,262,095 shares of which are issued and
outstanding[, and 10,000,000 are shares of preferred stock, par value $10.00 per
share of which 619 shares of preferred stock are issued and outstanding. The
authorized capital stock of each Subsidiary of the Company is set forth on
Schedule 4.3.

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     (b) Except as disclosed on Schedule 4.3, other than: (i) the shares
reserved for issuance under the Company’s stock option plans; and (ii) shares
which may be granted pursuant to this Agreement and the Related Agreements,
there are no outstanding options, warrants, rights (including conversion or
preemptive rights and rights of first refusal), proxy or stockholder agreements,
or arrangements or agreements of any kind for the purchase or acquisition from
the Company of any of its securities. Except as disclosed on Schedule 4.3,
neither the offer, issuance or sale of any of the Note or the Warrant, or the
issuance of any of the Note Shares or Warrant Shares, nor the consummation of
any transaction contemplated hereby will result in a change in the price or
number of any securities of the Company outstanding, under anti-dilution or
other similar provisions contained in or affecting any such securities.

     (c) All issued and outstanding shares of the Company’s Common Stock:
(i) have been duly authorized and validly issued and are fully paid and
nonassessable; and (ii) were issued in compliance with all applicable state and
federal laws concerning the issuance of securities.

     (d) The rights, preferences, privileges and restrictions of the shares of
the Common Stock are as stated in the Company’s Certificate of Incorporation
(the “Charter”). The Note Shares and Warrant Shares have been duly and validly
reserved for issuance. When issued in compliance with the provisions of this
Agreement and the Company’s Charter, the Securities will be validly issued,
fully paid and nonassessable, and will be free of any liens or encumbrances;
provided, however, that the Securities may be subject to restrictions on
transfer under state and/or federal securities laws as set forth herein or as
otherwise required by such laws at the time a transfer is proposed.

          4.4 Authorization; Binding Obligations. All corporate, partnership or
limited liability company, as the case may be, action on the part of the Company
and each of its Subsidiaries (including the respective officers and directors)
necessary for the authorization of this Agreement and the Related Agreements,
the performance of all obligations of the Company and its Subsidiaries hereunder
and under the other Related Agreements at the Closing and, the authorization,
sale, issuance and delivery of the Note and Warrant has been taken or will be
taken prior to the Closing. This Agreement and the Related Agreements, when
executed and delivered and to the extent it is a party thereto, will be valid
and binding obligations of each of the Company and each of its Subsidiaries,
enforceable against each such person in accordance with their terms, except:

     (a) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of
creditors’ rights; and

     (b) general principles of equity that restrict the availability of
equitable or legal remedies.

The sale of the Note and the subsequent conversion of the Note into Note Shares
are not and will not be subject to any preemptive rights or rights of first
refusal that have not been properly waived or complied with. The issuance of the
Warrant and the subsequent exercise of the

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Warrant for Warrant Shares are not and will not be subject to any preemptive
rights or rights of first refusal that have not been properly waived or complied
with.

          4.5 Liabilities. Neither the Company nor any of its Subsidiaries has
actual knowledge of any contingent liabilities, except (i) current liabilities
incurred in the ordinary course of business and (ii) liabilities disclosed in
any Exchange Act Filings.

          4.6 Intentionally Omitted.

          4.7 Intentionally Omitted.

          4.8 Material Adverse Effect. Except as set forth in Schedule 4.8, all
financial statements relating to the Company and its Subsidiaries that have been
delivered by the Company to the Purchaser have been prepared in accordance with
generally accepted accounting principles as in effect in the United States,
consistently applied, as of the dates thereof (except, in the case of unaudited
financial statements, for the lack of footnotes and being subject to year-end
audit adjustments) and present fairly in all material respects, the Company’s
financial condition as of the dates thereof and results of operations for the
periods then ended. Since the date of the latest financial statements submitted
to the Purchaser on or before the Closing Date, there has not been any change in
the business, prospects, operations, results of operations, assets, liabilities
or condition (financial or otherwise) of the Company which individually or in
the aggregate has had, or could reasonably be expected to have, individually or
in the aggregate a Material Adverse Effect.

          4.9 Title to Properties and Assets; Liens, Etc. Except as accrued for
and reflected in the Company’s financial statements, each of the Company and
each of its Subsidiaries has good and marketable title to its properties and
assets, and good title to its leasehold estates, in each case subject to no
mortgage, pledge, lien, lease, encumbrance or charge, other than:

     (a) those resulting from taxes which have not yet become delinquent;

     (b) minor liens and encumbrances which do not materially detract from the
value of the property subject thereto or materially impair the operations of the
Company or any of its Subsidiaries;

     (c) those that have otherwise arisen in the ordinary course of business;

     (d) those in favor of the Senior Creditor;

     (e) after giving effect to the transactions contemplated hereby, those in
favor of the Purchaser; and

     (f) those that have arisen in connection with debt permitted by Section
6.12(e)(i), including, but not limited to those liens in favor of Counsel
Corporation, an Ontario corporation, and its affiliates.

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All facilities, machinery, equipment, fixtures, vehicles and other properties
owned, leased or used by the Company and its Subsidiaries are in good operating
condition and repair and are reasonably fit and usable for the purposes for
which they are being used. Except as set forth on Schedule 4.9, the Company and
its Subsidiaries are in compliance with all material terms of each lease to
which it is a party or is otherwise bound.

          4.10 Intellectual Property. Each of the Company and each operating
Subsidiary owns, or holds licenses in, all trademarks, trade names, copyrights,
patents, patent rights, and licenses that are necessary to the conduct of its
business as presently conducted.

          4.11 Compliance with Other Instruments. Neither the Company nor any of
its Subsidiaries is in violation or default of (x) any term of its Charter or
Bylaws, or (y) of any provision of any indebtedness, mortgage, indenture,
contract, agreement or instrument to which it is party or by which it is bound
or of any judgment, decree, order or writ, which violation or default, in the
case of this clause (y), has had, or could reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect. Except as
set forth in Schedule 4.11, the execution, delivery and performance of and
compliance with this Agreement and the Related Agreements to which it is a
party, and the issuance and sale of the Note by the Company and the other
Securities by the Company each pursuant hereto and thereto, will not, with or
without the passage of time or giving of notice, result in any such material
violation, or be in conflict with or constitute a default under any such term or
provision, or result in the creation of any mortgage, pledge, lien, encumbrance
or charge upon any of the properties or assets of the Company or any of its
Subsidiaries (other than in favor of the Purchaser pursuant to the Master
Security Agreement and Stock Pledge) or the suspension, revocation, impairment,
forfeiture or nonrenewal of any permit, license, authorization or approval
applicable to the Company, its business or operations or any of its assets or
properties.

          4.12 Litigation. Except as set forth on Schedule 4.12 hereto, there is
no action, suit, proceeding or investigation pending or, to the Company’s
knowledge, currently threatened against the Company or any of its Subsidiaries
that prevents the Company or any of its Subsidiaries from entering into this
Agreement or the other Related Agreements, or from consummating the transactions
contemplated hereby or thereby, or which has had, or could reasonably be
expected to have, either individually or in the aggregate, a Material Adverse
Effect. Except as set forth on Schedule 4.12 hereto, there is no action, suit,
proceeding or investigation by the Company or any of its Subsidiaries currently
pending or which the Company or any of its Subsidiaries presently intends to
initiate where the amount in controversy exceeds $600,000.

          4.13 Tax Returns and Payments. Each of the Company and each of its
Subsidiaries has timely filed all tax returns (federal, state and local)
required to be filed by it in all material respects. All taxes shown to be due
and payable on such returns, any assessments imposed, and all other taxes due
and payable by the Company or any of its Subsidiaries on or before the Closing,
have been paid, or will be paid prior to the time they become delinquent, in all
material respects. Neither the Company nor any of its Subsidiaries has been
advised:

     (a) that any of its returns, federal, state or other, have been or are
being audited as of the date hereof; or

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     (b) of any deficiency in assessment or proposed judgment to its federal,
state or other taxes.

The Company has no knowledge of any liability of any tax to be imposed upon its
properties or assets as of the date of this Agreement that is not adequately
provided for.

          4.14 Employee Benefits. None of the Company, any of its Subsidiaries
or any of their ERISA Affiliates (as defined in the Foothill Loan) maintains or
contributes to any Benefit Plan (as defined in the Foothill Loan).

          4.15 Registration Rights and Voting Rights. Except as set forth on
Schedule 4.15 and except as disclosed in Exchange Act Filings, neither the
Company nor any of its Subsidiaries is presently under any obligation, and
neither the Company nor any of its Subsidiaries has granted any rights, to
register any of the Company’s or its Subsidiaries’ presently outstanding
securities or any of its securities that may hereafter be issued. Except as set
forth on Schedule 4.15 and except as disclosed in Exchange Act Filings, to the
Company’s knowledge, no stockholder of the Company or any of its Subsidiaries
has entered into any agreement with respect to the voting of equity securities
of the Company or any of its Subsidiaries.

          4.16 Compliance with Laws; Permits. Except as set forth on
Schedule 4.16, neither the Company nor any of its Subsidiaries is in violation
of any applicable statute, rule, regulation, order or restriction of any
domestic or foreign government or any instrumentality or agency thereof in
respect of the conduct of its business or the ownership of its properties which
has had, or could reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Effect. No governmental orders, permissions,
consents, approvals or authorizations are required to be obtained and no
registrations or declarations are required to be filed in connection with the
execution and delivery of this Agreement or any other Related Agreement and the
issuance of any of the Securities, except such as has been duly and validly
obtained or filed, or with respect to any filings that must be made after the
Closing, as will be filed in a timely manner. Each of the Company and its
Subsidiaries has all material franchises, permits, licenses and any similar
authority necessary for the conduct of its business as now being conducted by
it, the lack of which could, either individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.

          4.17 Environmental and Safety Laws. To the Company’s knowledge,
neither the Company nor any of its Subsidiaries is in violation of any
applicable statute, law or regulation relating to the environment or
occupational health and safety, and to its knowledge, no material expenditures
are or will be required in order to comply with any such existing statute, law
or regulation. To the Company’s knowledge, except as set forth on Schedule 4.17,
no Hazardous Materials (as defined below) are used or have been used, stored, or
disposed of by the Company or any of its Subsidiaries or, to the Company’s
knowledge, by any other person or entity on any property owned, leased or used
by the Company or any of its Subsidiaries. For the purposes of the preceding
sentence, “Hazardous Materials” shall mean:

     (a) materials which are listed or otherwise defined as “hazardous” or
“toxic” under any applicable local, state, federal and/or foreign laws and
regulations that govern

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the existence and/or remedy of contamination on property, the protection of the
environment from contamination, the control of hazardous wastes, or other
activities involving hazardous substances, including building materials; or

     (b) any petroleum products or nuclear materials.

          4.18 Valid Offering. Assuming the accuracy of the representations and
warranties of the Purchaser contained in this Agreement, the offer, sale and
issuance of the Securities will be exempt from the registration requirements of
the Securities Act of 1933, as amended (the “Securities Act”), and will have
been registered or qualified (or are exempt from registration and qualification)
under the registration, permit or qualification requirements of all applicable
state securities laws.

          4.19 Full Disclosure. Each of the Company and each of its Subsidiaries
has provided the Purchaser with all information requested by the Purchaser in
connection with its decision to purchase the Note and Warrant, including all
information the Company and its Subsidiaries believe is reasonably necessary to
make such investment decision. Neither this Agreement, the Related Agreements,
the exhibits and schedules hereto and thereto nor any other document delivered
by the Company or any of its Subsidiaries to Purchaser or its attorneys or
agents in connection herewith or therewith or with the transactions contemplated
hereby or thereby, contain any untrue statement of a material fact nor omit to
state a material fact necessary in order to make the statements contained herein
or therein, in light of the circumstances in which they are made, not
misleading. Any financial projections and other estimates provided to the
Purchaser by the Company or any of its Subsidiaries were based on the Company’s
and its Subsidiaries’ experience in the industry and on assumptions of fact and
opinion as to future events which the Company or any of its Subsidiaries, at the
date of the issuance of such projections or estimates, believed to be
reasonable, it being understood and acknowledged by the Purchaser that
projections and estimates are subject to significant uncertainties and
contingencies beyond the Company’s control and that no assurances can be given
that such projections will be realized.

          4.20 Insurance. Each of the Company and each of its Subsidiaries has
general commercial, product liability, fire and casualty insurance policies with
coverages which the Company believes are customary for companies similarly
situated to the Company and its Subsidiaries in the same or similar business.

          4.21 SEC Reports. Except as set forth on Schedule 4.21, the Company
has filed all proxy statements, reports and other documents required to be filed
by it under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). Except as set forth on Schedule 4.21, the Company’s Annual Report on Form
10-KSB for its fiscal year ended December 31, 2003, each of its Quarterly
Reports on Form 10-QSB for its fiscal quarters ended March 31, 2004 and June 30,
2004 and the Form 8-K filings which it has made during the fiscal year 2004 to
date (collectively, the “SEC Reports”), each was, at the time of its respective
filing, in substantial compliance with the requirements of its respective form
and none of the SEC Reports, nor the financial statements (and notes thereto)
included in the SEC Reports, as of their respective filing dates, contained any
untrue statement of a material fact or omitted to state a

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material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading.

          4.22 Quotation. The Company’s Common Stock is quoted on the
Over-the-Counter Bulletin Board (OTCBB) (the “Principal Market”). Except as set
forth on Schedule 4.22, the Company has not received any notice that its Common
Stock will cease to be quoted on the OTCBB or that its Common Stock does not
meet all requirements for continued quotation.

          4.23 No Integrated Offering. Neither the Company, nor any of its
Subsidiaries or affiliates, nor any person acting on its or their behalf, has
directly or indirectly made any offers or sales of any security or solicited any
offers to buy any security under circumstances that would cause the offering of
the Securities pursuant to this Agreement or any of the Related Agreements to be
integrated with prior offerings by the Company for purposes of the Securities
Act which would prevent the Company from selling the Securities pursuant to
Rule 506 under the Securities Act, or any applicable exchange-related
stockholder approval provisions, nor will the Company or any of its affiliates
or Subsidiaries take any action or steps that would cause the offering of the
Securities to be integrated with other offerings.

          4.24 Stop Transfer. The Securities are restricted securities as of the
date of this Agreement. Neither the Company nor any of its Subsidiaries will
issue any stop transfer order or other order impeding the sale and delivery of
any of the Securities at such time as the Securities are registered for public
sale or an exemption from registration is available, except as required by state
and federal securities laws.

          4.25 Dilution. The Company specifically acknowledges that its
obligation to issue the shares of Common Stock upon conversion of the Note and
exercise of the Warrant is binding upon the Company and enforceable regardless
of the dilution such issuance may have on the ownership interests of other
shareholders of the Company.

          4.26 Patriot Act. The Company certifies that, to the best of Company’s
knowledge, neither the Company nor any of its Subsidiaries has been designated,
and is not owned or controlled, by a “suspected terrorist” as defined in
Executive Order 13224. The Company hereby acknowledges that the Purchaser seeks
to comply with all applicable laws concerning money laundering and related
activities. In furtherance of those efforts, the Company hereby represents,
warrants and agrees that: (i) none of the cash or property that the Company or
any of its Subsidiaries will pay or will contribute to the Purchaser has been or
shall be derived from, or related to, any activity that is deemed criminal under
United States law; and (ii) no contribution or payment by the Company or any of
its Subsidiaries to the Purchaser, to the extent that they are within the
Company’s and/or its Subsidiaries’ control shall cause the Purchaser to be in
violation of the United States Bank Secrecy Act, the United States International
Money Laundering Control Act of 1986 or the United States International Money
Laundering Abatement and Anti-Terrorist Financing Act of 2001. The Company shall
promptly notify the Purchaser if any of these representations ceases to be true
and accurate regarding the Company or any of its Subsidiaries. The Company
agrees to provide the Purchaser any additional information regarding the Company
or any of its Subsidiaries that the Purchaser deems necessary or convenient to
ensure compliance with all applicable laws concerning money laundering and
similar activities. The Company understands and agrees that if at any time it is

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finally determined by a court of competent jurisdiction or other appropriate
governmental authority that any of the foregoing representations are incorrect
in any material respect or incorrect such that the Purchaser is adversely
affected, or if otherwise required by applicable law or regulation related to
money laundering similar activities, the Purchaser may seek appropriate and
reasonably necessary relief to ensure compliance with applicable law or
regulation, including, but not limited to, segregation and/or redemption of the
Purchaser’s investment in the Company. The Company further understands that the
Purchaser may release confidential information about the Company and its
Subsidiaries and, if applicable, any underlying beneficial owners, to proper
governmental authorities if the Purchaser, in its good faith, reasonable
discretion, determines that it is in the best interests of the Purchaser in
light of relevant rules and regulations under the laws set forth in subsection
(ii) above.

     5. Representations and Warranties of the Purchaser. The Purchaser hereby
represents and warrants to the Company as follows (such representations and
warranties do not lessen or obviate the representations and warranties of the
Company set forth in this Agreement):

          5.1 No Shorting. The Purchaser or any of its affiliates and investment
partners has not directly engaged in, and will not and will not cause any person
or entity to directly engage in, “short sales” of the Company’s Common Stock as
long as the Note shall be outstanding.

          5.2 Requisite Power and Authority. The Purchaser has all necessary
power and authority under all applicable provisions of law and its governing
documents and operating agreements, as applicable, to execute and deliver this
Agreement and the Related Agreements and to carry out their provisions. All
corporate action on Purchaser’s part required for the lawful execution and
delivery of this Agreement and the Related Agreements have been or will be
effectively taken prior to the Closing. Upon their execution and delivery, this
Agreement and the Related Agreements will be valid and binding obligations of
Purchaser, enforceable in accordance with their terms, except:

     (a) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application affecting enforcement of
creditors’ rights; and

     (b) as limited by general principles of equity that restrict the
availability of equitable and legal remedies.

          5.3 Investment Representations. Purchaser understands that the
Securities are being offered and sold pursuant to an exemption from registration
contained in the Securities Act based in part upon Purchaser’s representations
contained in the Agreement, including, without limitation, that the Purchaser is
an “accredited investor” within the meaning of Regulation D under the Securities
Act of 1933, as amended (the “Securities Act”). The Purchaser confirms that it
has received or has had full access to all the information it considers
necessary or appropriate to make an informed investment decision with respect to
the Note and the Warrant to be purchased by it under this Agreement and the Note
Shares and the Warrant Shares acquired by it upon the conversion of the Note and
the exercise of the Warrant, respectively. The Purchaser further confirms that
it has had an opportunity to ask questions and receive answers from the

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Company regarding the Company’s and its Subsidiaries’ business, management and
financial affairs and the terms and conditions of the Offering, the Note, the
Warrant and the Securities and to obtain additional information (to the extent
the Company possessed such information or could acquire it without unreasonable
effort or expense) necessary to verify any information furnished to the
Purchaser or to which the Purchaser had access.

          5.4 Purchaser Bears Economic Risk. The Purchaser has substantial
experience in evaluating and investing in private placement transactions of
securities in companies similar to the Company so that it is capable of
evaluating the merits and risks of its investment in the Company and has the
capacity to protect its own interests. The Purchaser must bear the economic risk
of this investment until the Securities are sold pursuant to: (i) an effective
registration statement under the Securities Act; or (ii) an exemption from
registration is available with respect to such sale.

          5.5 Acquisition for Own Account. The Purchaser is acquiring the Note
and Warrant and the Note Shares and the Warrant Shares for the Purchaser’s own
account for investment only, and not as a nominee or agent and not with a view
towards or for resale in connection with their distribution.

          5.6 Purchaser Can Protect Its Interest. The Purchaser represents that
by reason of its, or of its management’s, business and financial experience, the
Purchaser has the capacity to evaluate the merits and risks of its investment in
the Note, the Warrant and the Securities and to protect its own interests in
connection with the transactions contemplated in this Agreement and the Related
Agreements. Further, Purchaser is aware of no publication of any advertisement
in connection with the transactions contemplated in the Agreement or the Related
Agreements.

          5.7 Accredited Investor. Purchaser represents that it is an accredited
investor within the meaning of Regulation D under the Securities Act.

          5.8 Withholding Tax Exemption. The Purchaser represents that in
connection with any and all interest and principal payments made by the Company
to the Purchaser under this Agreement, the Note or any Related Agreement, the
Company is not required to withhold any U.S. withholding taxes under Section
1441 or 1442 of the U.S. Internal Revenue Code.

          5.9 Legends.

     (a) The Note shall bear substantially the following legend:

“THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE,
STATE SECURITIES LAWS. THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION
OF THIS NOTE MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS NOTE OR SUCH SHARES
UNDER SAID ACT AND APPLICABLE STATE

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SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO ACCERIS
COMMUNICATIONS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

     (b) The Note Shares and the Warrant Shares, if not issued by DWAC system
(as hereinafter defined), shall bear a legend which shall be in substantially
the following form until such shares are covered by an effective registration
statement filed with the SEC:

“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS.
THESE SHARES MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH SECURITIES ACT AND
APPLICABLE STATE LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
ACCERIS COMMUNICATIONS INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

     (c) The Warrant shall bear substantially the following legend:

“THIS WARRANT AND THE COMMON SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAWS. THIS WARRANT AND THE COMMON SHARES ISSUABLE
UPON EXERCISE OF THIS WARRANT MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS
WARRANT OR THE UNDERLYING SHARES OF COMMON STOCK UNDER SAID ACT AND APPLICABLE
STATE SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO
ACCERIS COMMUNICATIONS, INC. THAT SUCH REGISTRATION IS NOT REQUIRED.”

     6. Covenants of the Company. The Company covenants and agrees with the
Purchaser as follows:

          6.1 Stop-Orders. The Company will advise the Purchaser, promptly after
it receives notice of issuance by the Securities and Exchange Commission (the
“SEC”), any state securities commission or any other regulatory authority of any
stop order or of any order preventing or suspending any offering of any
securities of the Company, or of the suspension of the qualification of the
Common Stock of the Company for offering or sale in any jurisdiction, or the
initiation of any proceeding for any such purpose.

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          6.2 Quotation. The Company shall maintain the quotation of its Common
Stock on the Principal Market, and will comply in all material respects with the
requirements for continued quotation.

          6.3 Market Regulations. The Company shall take all necessary action
and proceedings and make all filings as may be required and permitted by
applicable law, rule and regulation, for the legal and valid issuance of the
Securities to the Purchaser and, upon request of the Purchaser, shall promptly
provide copies thereof to the Purchaser.

          6.4 Reporting Requirements. The Company will timely file with the SEC
all reports relating to periods closing subsequent to the date hereof required
to be filed pursuant to the Exchange Act and refrain from terminating its status
as an issuer required by the Exchange Act to file reports thereunder even if the
Exchange Act or the rules or regulations thereunder would permit such
termination.

          6.5 Use of Funds. The Company agrees that it will use the proceeds of
the sale of the Note and the Warrant for its general working capital purposes or
its Subsidiaries general working capital purposes only.

          6.6 Access to Facilities. Each of the Company and each of its
Subsidiaries will permit any representatives designated by the Purchaser (or any
successor of the Purchaser), upon reasonable notice and during normal business
hours, at such person’s expense and accompanied by a representative of the
Company, to:

     (a) visit and inspect any of the properties of the Company or any of its
Subsidiaries;

     (b) examine the corporate and financial records of the Company or any of
its Subsidiaries (unless such examination is not permitted by federal, state or
local law or by contract) and make copies thereof or extracts therefrom; and

     (c) discuss the affairs, finances and accounts of the Company or any of its
Subsidiaries with the directors, officers and independent accountants of the
Company or any of its Subsidiaries;

provided, however, that such visits, inspections and examinations shall not
occur more than twice per fiscal year in the aggregate in the absence of an
Event of Default. In the event that Company or any of its Subsidiaries provides
any material, non-public information to the Purchaser pursuant to this
Section 6.6 or otherwise, the Purchaser shall comply with Regulation FD and all
other applicable federal securities laws in connection therewith and, upon the
request of the Company, shall sign a confidentiality agreement.

          6.7 Taxes. Each of the Company and each of its Subsidiaries will
promptly pay and discharge, or cause to be paid and discharged, when due and
payable, all lawful taxes, assessments and governmental charges or levies
imposed upon the income, profits, property or business of the Company and its
Subsidiaries except where failure to do so would not have a Material Adverse
Effect; provided, however, that any such tax, assessment, charge or levy need
not be paid if the validity thereof shall currently be contested in good faith
by appropriate

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proceedings, as determined in the good faith business judgment of the Company,
and if the Company and/or such Subsidiary shall have set aside on its books
adequate reserves with respect thereto, and provided, further, that the Company
and its Subsidiaries will pay all such taxes, assessments, charges or levies
forthwith upon the commencement of proceedings to foreclose any lien which may
have attached as security therefor.

          6.8 Insurance. Each of the Company and its Subsidiaries will keep its
assets which are of an insurable character insured by financially sound and
reputable insurers against loss or damage by fire, explosion and other risks
customarily insured against by companies in similar business similarly situated
as the Company and its Subsidiaries; and the Company and its Subsidiaries will
maintain, with financially sound and reputable insurers, insurance against other
hazards and risks and liability to persons and property to the extent and in the
manner which the Company reasonably believes is customary for companies in
similar business similarly situated as the Company and its Subsidiaries and to
the extent available on commercially reasonable terms. The Company, and each of
its Subsidiaries that is a party to the Master Security Agreement will jointly
and severally bear the full risk of loss from any loss of any nature whatsoever
with respect to the assets pledged to the Purchaser as security for its
obligations hereunder and under the Related Agreements. At the Company’s and
each of its Subsidiaries’ joint and several cost and expense in amounts and with
carriers reasonably acceptable to Purchaser, the Company and each of its
Subsidiaries shall (i) keep all its insurable properties and properties in which
it has an interest insured against the hazards of fire, flood, sprinkler
leakage, those hazards covered by extended coverage insurance and such other
hazards, and for such amounts, as is customary in the case of companies engaged
in businesses similar to the Company’s or the respective Subsidiary’s including
business interruption insurance; (ii) maintain a bond in such amounts as is
customary in the case of companies engaged in businesses similar to the
Company’s or the respective Subsidiary’s insuring against larceny, embezzlement
or other criminal misappropriation of insured’s officers and employees who may
either singly or jointly with others at any time have access to the assets or
funds of the Company or any of its Subsidiaries either directly or through
governmental authority to draw upon such funds or to direct generally the
disposition of such assets; (iii) maintain public and product liability
insurance against claims for personal injury, death or property damage suffered
by others; (iv) maintain all such worker’s compensation or similar insurance as
may be required under the laws of any state or jurisdiction in which the Company
or the respective Subsidiary is engaged in business; and (v) furnish Purchaser
with (x) copies of all policies and evidence of the maintenance of such policies
at least thirty (30) days before any expiration date, (y) excepting the
Company’s workers’ compensation policy, endorsements to such policies naming
Purchaser as “co-insured” or “additional insured” and appropriate loss payable
endorsements in form and substance satisfactory to Purchaser, naming Purchaser
as loss payee, and (z) evidence that as to Purchaser the insurance coverage
shall not be impaired or invalidated by any act or neglect of the Company or any
Subsidiary and the insurer will provide Purchaser with at least thirty (30) days
notice prior to cancellation. The Company and each Subsidiary shall instruct the
insurance carriers that in the event of any loss thereunder, the carriers shall
make payment for such loss to the Company and/or the Subsidiary and Purchaser
jointly. In the event that as of the date of receipt of each loss recovery upon
any such insurance, the Purchaser has not declared an Event of Default with
respect to this Agreement or any of the Related Agreements, then the Company
and/or such Subsidiary shall be permitted to direct the application of such loss
recovery proceeds toward investment in property, plant and equipment that would
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Purchaser’s security interest pursuant to the Master Security Agreement, with
any surplus funds, at the request of the Purchaser and subject to the
Intercreditor Agreement, to be applied toward payment of the obligations of the
Company to Purchaser, provided that any such payment shall not be subject to any
prepayment penalties or premiums. In the event that Purchaser has properly
declared an Event of Default with respect to this Agreement or any of the
Related Agreements, then all loss recoveries received by Purchaser upon any such
insurance thereafter may be applied to the obligations of the Company hereunder
and under the Related Agreements, in such order as the Purchaser may determine,
subject to the Intercreditor Agreement, provided that any such payment shall not
be subject to any prepayment penalties or premiums. Any surplus (following
satisfaction of all Company obligations to Purchaser and the Senior Creditor)
shall be paid by Purchaser to the Company or applied as may be otherwise
required by law. Any deficiency thereon shall be paid by the Company or the
Subsidiary, as applicable, to Purchaser, on demand, during the continuance of
any such Event of Default.

          6.9 Intellectual Property. Each of the Company and each of its
Subsidiaries shall use commercially reasonable efforts to maintain in full force
and effect its existence, rights and franchises and all licenses and other
rights to use Intellectual Property owned or possessed by it and reasonably
deemed to be necessary to the conduct of its business.

          6.10 Properties. Each of the Company and each of its Subsidiaries will
keep its properties in good repair, working order and condition, reasonable wear
and tear excepted, and from time to time make all needful and proper repairs,
renewals, replacements, additions and improvements thereto as deemed necessary
or desirable by the Company and such Subsidiary in the exercise of its
reasonable business judgment; and each of the Company and each of its
Subsidiaries will at all times comply with each provision of all leases to which
it is a party or under which it occupies property if the breach of such
provision could, either individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.

          6.11 Confidentiality. The Company agrees that it will not disclose,
and will not include in any public announcement, the name of the Purchaser,
unless expressly agreed to by the Purchaser or unless and until such disclosure
is required by law, a court of competent jurisdiction, applicable regulation or
statutory requirement, and then only to the extent of such requirement.
Notwithstanding the foregoing, the Company may disclose Purchaser’s identity and
the terms of this Agreement to its current and prospective debt and equity
financing sources.

          6.12 Required Approvals. For so long as twenty-five percent (25%) of
the initial principal amount of the Note is outstanding, the Company, without
the prior written consent of the Purchaser (which shall not be unreasonably
withheld, delayed or conditioned), shall not, and shall not permit any of its
Subsidiaries to:

     (a) (i) directly or indirectly declare or pay any dividends, other than
dividends paid to the Parent or any of its wholly-owned Subsidiaries, (ii) issue
any preferred stock that is manditorily redeemable prior to the one year
anniversary of Maturity Date (as defined in the Note) or (iii) redeem any of its
preferred stock or other equity interests (other than pursuant to certain
ongoing dissenters’ rights matters in the state of Florida in connection with
the restructuring of certain debt into equity in November 2003);

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     (b) liquidate, dissolve or effect a material reorganization or merger with
any person or entity other than the Company or a Subsidiary, provided that the
Company and its Subsidiaries may engage in any such transaction (i) where the
Company is the surviving entity or (ii) that does not materially reduce the
assets of the Company and its Subsidiaries on a consolidated basis;

     (c) become subject to (including, without limitation, by way of amendment
to or modification of) any agreement or instrument which by its terms would
(under any circumstances) restrict the Company’s or any of its Subsidiaries
right to perform the provisions of this Agreement, any Related Agreement or any
of the agreements contemplated hereby or thereby;

     (d) engage primarily in any business other than the telecommunications and
technology business or any other business not approved in advance by the Board
of Directors of the Company;

     (e) (i) create, incur, assume or suffer to exist any indebtedness
(exclusive of trade debt and debt incurred to finance the purchase of equipment
(not in excess of the amounts permitted pursuant to the terms of the Senior
Debt) whether secured or unsecured other than (u) the Company’s indebtedness to
the Purchaser, (v) the Senior Debt, (w) any other indebtedness set forth on
Schedule 6.12(e) attached hereto, (x) any debt that is subordinate to the
Obligations and in connection with which a subordination agreement in form and
substance reasonably satisfactory to the Purchaser is in effect therewith,
(y) debt incurred in connection with certain business development loans from the
State of Pennsylvania (not in excess of $6,000,000 in principal outstanding at
any time) and (z) any debt incurred in connection with the purchase of assets in
the ordinary course of business, or any refinancings or replacements thereof on
terms no less favorable to the Company than the indebtedness being refinanced or
replaced; (ii) cancel any debt owing to it in excess of $50,000 in the aggregate
during any 12-month period; (iii) assume, guarantee, endorse or otherwise become
directly or contingently liable in connection with any obligations of any other
Person, except the endorsement of negotiable instruments by the Company or its
Subsidiaries for deposit or collection or similar transactions in the ordinary
course of business or guarantees of indebtedness otherwise permitted to be
outstanding pursuant to this clause (e); and

     (f) create or acquire any Subsidiary after the date hereof unless such
Subsidiary that is an operating Subsidiary becomes party to the Master Security
Agreement, the Stock Pledge Agreement and the Subsidiary Guaranty (either by
executing a counterpart thereof or an assumption or joinder agreement in respect
thereof) and, to the extent required by the Purchaser, satisfies each condition
of this Agreement and the Related Agreements as if such Subsidiary were a
Subsidiary on the Closing Date.

          6.13 Reissuance of Securities. The Company agrees to reissue
certificates representing the Securities without the legends set forth in
Section 5.8 above at such time as:

     (a) the holder thereof is permitted to dispose of such Securities pursuant
to Rule 144(k) under the Securities Act; or

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     (b) upon resale subject to an effective registration statement after such
Securities are registered under the Securities Act.

Upon request, the Company agrees to cooperate with the Purchaser in connection
with all resales pursuant to Rule 144(d) and Rule 144(k) and provide legal
opinions reasonably and customarily required to allow such resales provided the
Company and its counsel receive reasonably requested representations from the
selling Purchaser and broker, if any.

          6.14 Opinion. On the Closing Date, the Company will deliver to the
Purchaser an opinion acceptable to the Purchaser from the Company’s external
legal counsel. The Company will provide, at the Company’s expense, such other
legal opinions in the future as are deemed reasonably necessary by the Purchaser
(and acceptable to the Purchaser) in connection with the conversion of the Note
and exercise of the Warrant.

          6.15 Margin Stock. The Company will not permit any of the proceeds of
the Note or the Warrant to be used directly or indirectly to “purchase” or
“carry” “margin stock” or to repay indebtedness incurred to “purchase” or
“carry” “margin stock” within the respective meanings of each of the quoted
terms under Regulation U of the Board of Governors of the Federal Reserve System
as now and from time to time hereafter in effect.

     7. Covenants of the Purchaser. The Purchaser covenants and agrees with the
Company as follows:

          7.1 Subordination. In furtherance of the Purchaser’s acknowledgement
and agreement that this Agreement and the Purchaser’s security interests and the
exercise of its rights and remedies hereunder are subject and subordinate to
those of the Senior Creditor under the Senior Debt, whether now or hereafter
created, Laurus agrees that it shall, at the request of the Company, execute a
subsequent Intercreditor Agreement with any replacement or successor Senior
Creditor effecting and evidencing the continuing subordination of the
obligations of the Company under this Agreement, the Note and the other Related
Agreements, provided such Intercreditor Agreement shall contain subordination
and security provisions not materially more restrictive upon the Purchaser than
those contained in the Intercreditor Agreement in effect on the date hereof.

          7.2 Confidentiality. The Purchaser agrees that it will not disclose,
and will not include in any public announcement, the name of the Company, unless
expressly agreed to by the Company or unless and until such disclosure is
required by applicable law, a court of competent jurisdiction, applicable
regulation or statutory requirement, and then only to the extent of such
requirement.

          7.3 Non-Public Information. The Purchaser agrees not to effect any
sales in the shares of the Company’s Common Stock while in possession of
material, non-public information regarding the Company if such sales would
violate applicable securities law.

          7.4 [Intentionally Omitted].

     8. Covenants of the Company and Purchaser Regarding Indemnification.

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          8.1 Company Indemnification. The Company agrees to indemnify, hold
harmless, reimburse and defend the Purchaser, each of the Purchaser’s officers,
directors, agents, affiliates, control persons, and principal shareholders,
against any claim, cost, expense, liability, obligation, loss or damage
(including reasonable legal fees), incurred by or imposed upon the Purchaser in
connection with any third-party claim or action which results, arises out of or
is based upon: (i) any misrepresentation by the Company or any of its
Subsidiaries or breach of any warranty by the Company or any of its Subsidiaries
in this Agreement, any other Related Agreement or in any exhibits or schedules
attached hereto or thereto; or (ii) any breach or default in performance by
Company or any of its Subsidiaries of any covenant or undertaking to be
performed by Company or any of its Subsidiaries hereunder, under any other
Related Agreement or any other agreement entered into by the Company and/or any
of its Subsidiaries and Purchaser relating hereto or thereto. Amounts payable by
the Company under this Section 8.1 are subject to verification by the Company or
an independent accountant appointed by the Company and reasonably acceptable to
the Purchaser.

          8.2 Purchaser’s Indemnification. Purchaser agrees to indemnify, hold
harmless, reimburse and defend each of the Company and each Subsidiary and each
of its respective officers, directors, agents, affiliates, control persons and
principal shareholders, at all times against any claim, cost, expense,
liability, obligation, loss or damage (including reasonable legal fees) incurred
by or imposed upon such indemnified party in connection with any third-party
claim or action which results, arises out of or is based upon: (i) any
misrepresentation by Purchaser or breach of any warranty by Purchaser in this
Agreement or in any exhibits or schedules attached hereto or any Related
Agreement; or (ii) any breach or default in performance by Purchaser of any
covenant or undertaking to be performed by Purchaser hereunder, or any other
agreement entered into by the Company and/or any of its Subsidiaries and
Purchaser relating hereto or thereto. Amounts payable by the Purchaser under
this Section 8.2 are subject to verification by the Purchaser or an independent
accountant appointed by the Purchaser and reasonably acceptable to the Company.

          8.3 Notwithstanding the foregoing, neither the Purchaser nor the
Company shall be liable to the other for any indirect, special, incidental or
consequential damages in connection with this Section 8 or any other provision
of this Agreement, the Note or any other Related Agreement.

     9. Conversion of Convertible Note.

          9.1 Mechanics of Conversion.

     (a) Provided the Purchaser has notified the Company of the Purchaser’s
intention to sell the Note Shares and the Note Shares are included in an
effective registration statement or are otherwise exempt from registration when
sold: (i) upon the conversion of the Note or part thereof, the Company shall, at
its own cost and expense, take all necessary action (including the issuance of
an opinion of counsel reasonably acceptable to the Purchaser following a request
by the Purchaser) to assure that the Company’s transfer agent shall issue shares
of the Company’s Common Stock in the name of the Purchaser (or its nominee) or
such other persons as designated by the Purchaser in accordance with
Section 9.1(b) hereof and in such denominations to be

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specified representing the number of Note Shares issuable upon such conversion;
and (ii) the Company warrants that no instructions other than these instructions
have been or will be given to the transfer agent of the Company’s Common Stock
and that after the Effectiveness Date (as defined in the Registration Rights
Agreement) the Note Shares issued will be freely transferable subject to the
prospectus delivery requirements of the Securities Act, any other applicable
securities laws (including, but not limited to, those relating to the possession
of material non-public information), and the provisions of this Agreement, and
will not contain a legend restricting the resale or transferability of the Note
Shares.

     (b) Purchaser will give notice of its decision to exercise its right to
convert the Note or part thereof by telecopying or otherwise delivering an
executed and completed notice of the number of shares to be converted to the
Company (the “Notice of Conversion”). The Purchaser will not be required to
surrender the Note until the Purchaser receives a credit to the account of the
Purchaser’s prime broker through the DWAC system (as defined below),
representing the Note Shares or until the Note has been fully satisfied. Each
date on which a Notice of Conversion is telecopied or delivered to the Company
in accordance with the provisions hereof shall be deemed a “Conversion Date.”
Pursuant to the terms of the Notice of Conversion, the Company will issue
instructions to the transfer agent accompanied by an opinion of counsel within
one (1) business day of the date of the delivery to the Company of the Notice of
Conversion and shall cause the transfer agent to transmit the certificates
representing the Conversion Shares to the Holder by crediting the account of the
Purchaser’s prime broker with the Depository Trust Company (“DTC”) through its
Deposit Withdrawal Agent Commission (“DWAC”) system within three (3) business
days after receipt by the Company of the Notice of Conversion (the “Delivery
Date”).

     (c) The Company understands that a delay in the delivery of the Note Shares
in the form required pursuant to Section 9 hereof beyond the Delivery Date could
result in economic loss to the Purchaser. In the event that the Company fails to
direct its transfer agent to deliver the Note Shares to the Purchaser via the
DWAC system within the time frame set forth in Section 9.1(b) above and the Note
Shares are not delivered to the Purchaser by the Delivery Date, as compensation
to the Purchaser for such loss, the Company agrees to pay late payments to the
Purchaser for late issuance of the Note Shares in the form required pursuant to
Section 9 hereof upon conversion of the Note in the amount equal to $500 per
business day after the Delivery Date. Notwithstanding the foregoing, the Company
will not owe the Purchaser any late payments if the delay in the delivery of the
Note Shares beyond the Delivery Date is solely out of the control of the Company
and the Company is actively trying to cure the cause of the delay. The Company
shall pay any payments incurred under this Section in immediately available
funds upon demand.

Nothing contained herein or in any document referred to herein or delivered in
connection herewith shall be deemed to establish or require the payment of a
rate of interest or other charges in excess of the maximum permitted by
applicable law. In the event that the rate of interest or dividends required to
be paid or other charges hereunder exceed the maximum amount permitted

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by such law, any payments in excess of such maximum shall be credited against
amounts owed by the Company to a Purchaser and thus refunded to the Company.

     10. Registration Rights. The Company hereby grants registration rights to
the Purchaser pursuant to a Registration Rights Agreement dated as of even date
herewith between the Company and the Purchaser.

     11. Miscellaneous.

          11.1 Governing Law. THIS AGREEMENT AND EACH RELATED AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. ANY ACTION BROUGHT BY EITHER
PARTY AGAINST THE OTHER CONCERNING THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT AND EACH RELATED AGREEMENT SHALL BE BROUGHT ONLY IN THE STATE COURTS
OF NEW YORK OR IN THE FEDERAL COURTS LOCATED IN THE STATE OF NEW YORK. BOTH
PARTIES AND THE INDIVIDUALS EXECUTING THIS AGREEMENT AND THE RELATED AGREEMENTS
ON BEHALF OF THE COMPANY AGREE TO SUBMIT TO THE JURISDICTION OF SUCH COURTS AND
WAIVE TRIAL BY JURY. IN THE EVENT THAT ANY PROVISION OF THIS AGREEMENT OR ANY
RELATED AGREEMENT DELIVERED IN CONNECTION HEREWITH IS INVALID OR UNENFORCEABLE
UNDER ANY APPLICABLE STATUTE OR RULE OF LAW, THEN SUCH PROVISION SHALL BE DEEMED
INOPERATIVE TO THE EXTENT THAT IT MAY CONFLICT THEREWITH AND SHALL BE DEEMED
MODIFIED TO CONFORM WITH SUCH STATUTE OR RULE OF LAW. ANY SUCH PROVISION WHICH
MAY PROVE INVALID OR UNENFORCEABLE UNDER ANY LAW SHALL NOT AFFECT THE VALIDITY
OR ENFORCEABILITY OF ANY OTHER PROVISION OF THIS AGREEMENT OR ANY RELATED
AGREEMENT.

          11.2 Survival. The representations, warranties, covenants and
agreements made herein shall survive any investigation made by the Purchaser and
the closing of the transactions contemplated hereby to the extent provided
therein. All statements as to factual matters contained in any certificate or
other instrument delivered by or on behalf of the Company pursuant hereto in
connection with the transactions contemplated hereby shall be deemed to be
representations and warranties by the Company hereunder solely as of the date of
such certificate or instrument.

          11.3 Successors. Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, heirs, executors and administrators of the parties hereto and shall
inure to the benefit of and be enforceable by each person who shall be a holder
of the Securities from time to time, other than the holders of Common Stock
which has been sold by the Purchaser pursuant to Rule 144 or an effective
registration statement. Purchaser may not assign its rights hereunder to a
competitor of the Company.

          11.4 Entire Agreement. This Agreement, the Related Agreements, the
exhibits and schedules hereto and thereto and the other documents delivered
pursuant hereto constitute

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the full and entire understanding and agreement between the parties with regard
to the subjects hereof and no party shall be liable or bound to any other in any
manner by any representations, warranties, covenants and agreements except as
specifically set forth herein and therein.

          11.5 Severability. In case any provision of the Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

          11.6 Amendment and Waiver.

     (a) This Agreement may be amended or modified only upon the written consent
of the Company and the Purchaser.

     (b) The obligations of the Company and the rights of the Purchaser under
this Agreement may be waived only with the written consent of the Purchaser.

     (c) The obligations of the Purchaser and the rights of the Company under
this Agreement may be waived only with the written consent of the Company.

          11.7 Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power or remedy accruing to any party, upon any breach,
default or noncompliance by another party under this Agreement or the Related
Agreements, shall impair any such right, power or remedy, nor shall it be
construed to be a waiver of any such breach, default or noncompliance, or any
acquiescence therein, or of or in any similar breach, default or noncompliance
thereafter occurring. All remedies, either under this Agreement or the Related
Agreements, by law or otherwise afforded to any party, shall be cumulative and
not alternative.

          11.8 Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given:

     (a) upon personal delivery to the party to be notified;

     (b) when sent by confirmed facsimile if sent during normal business hours
of the recipient, if not, then on the next business day;

     (c) three (3) business days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or

     (d) one (1) day after deposit with a nationally recognized overnight
courier, specifying next day delivery, with written verification of receipt.

Attempted delivery of any notice or request hereunder by electronic transmission
(including, but not limited to, electronic mail) or communications through the
internet shall not constitute delivery hereunder. All communications shall be
sent as follows:

     
If to the Company, to:
  Acceris Communications Inc.

  Scotia Plaza

  40 King Street, Suite 3200

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  Toronto, Ontario, Canada M5H 3Y2

  Attention: Chief Financial Officer
Facsimile: (416) 866-3050
 
   

  with a copy to:
 
   

  Acceris Communications Inc.

  8813 Ridge Road

  Bethesda , Maryland 20817-3235

  Attention: David Silverman

  Facsimile: (301) 365-3638
 
   
 
  and:
 
   

  Neal, Gerber & Eisenberg, LLP

  Two North LaSalle Street, Suite 2200

  Chicago, Illinois 60606

  Attention: Arthur B. Muir, Esq.
Facsimile: (312) 269-1747
 
   
If to the Purchaser, to:
  Laurus Master Fund, Ltd.

  c/o M&C Corporate Services Limited

  P.O. Box 309 GT

  Ugland House

  George Town

  South Church Street

  Grand Cayman, Cayman Islands

  Facsimile: 345-949-8080
 
   
 
  with a copy to:
 
   

  John E. Tucker, Esq.

  825 Third Avenue 14th Floor

  New York, NY 10022

  Facsimile: 212-541-4434

or at such other address as the Company or the Purchaser may designate by
written notice to the other parties hereto given in accordance herewith.

          11.9 Attorneys’ Fees. In the event that any suit or action is
instituted to enforce any provision in this Agreement, the prevailing party in
such dispute shall be entitled to recover from the losing party all reasonable
out-of-pocket fees, costs and expenses of enforcing any right of such prevailing
party under or with respect to this Agreement, including, without limitation,
such reasonable out-of-pocket fees and expenses of attorneys and accountants,
which shall include, without limitation, all reasonable out-of-pocket fees,
costs and expenses of appeals.

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          11.10 Titles and Subtitles. The titles of the sections and subsections
of this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.

          11.11 Facsimile Signatures; Counterparts. This Agreement may be
executed by facsimile signatures and in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one and
the same instrument.

          11.12 Broker’s Fees. Except as set forth on Schedule 11.12 hereof,
each party hereto represents and warrants that no agent, broker, investment
banker, person or firm acting on behalf of or under the authority of such party
hereto is or will be entitled to any broker’s or finder’s fee or any other
commission directly or indirectly in connection with the transactions
contemplated herein. Each party hereto further agrees to indemnify each other
party as set forth in Section 8 hereof, for any claims, losses or expenses
incurred by such other party as a result of the representation in this Section
11.12 being untrue.

          11.13 Construction. Each party acknowledges that its legal counsel
participated in the preparation of this Agreement and the Related Agreements
and, therefore, stipulates that the rule of construction that ambiguities are to
be resolved against the drafting party shall not be applied in the
interpretation of this Agreement to favor any party against the other.

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     IN WITNESS WHEREOF, the parties hereto have executed the SECURITIES
PURCHASE AGREEMENT as of the date set forth in the first paragraph hereof.

             
COMPANY:
      PURCHASER:    
 
            ACCERIS COMMUNICATIONS INC.   LAURUS MASTER FUND, LTD.
 
           
By:
 

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  By:  

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Name:
 

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  Name:  

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Title:
 

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  Title:  

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EXHIBIT A

FORM OF CONVERTIBLE NOTE

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EXHIBIT B

FORM OF WARRANT

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EXHIBIT C

FORM OF ESCROW AGREEMENT

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