Exhibit 10.64
 
WAIVER AND THIRD AMENDMENT TO SECOND AMENDED AND RESTATED SECURITIES PURCHASE
AGREEMENT AND SECURITY AGREEMENT
 
THIS WAIVER AND THIRD AMENDMENT (this “Amendment”) is entered into as of August
12, 2015, by and among FUSION NBS ACQUISITION CORP. a Delaware corporation
(“Borrower”), FUSION TELECOMMUNICATIONS INTERNATIONAL, INC., a Delaware
corporation (“Parent”), NETWORK BILLING SYSTEMS, L.L.C., a New Jersey limited
liability company (“NBS”), FUSION BVX LLC, a Delaware limited liability company
(“BVX”), PINGTONE COMMUNICATIONS, INC., a Delaware corporation (together with
Parent, NBS, BVX, the “Guarantors”, and together with the Borrower, the “Credit
Parties” and each a “Credit Party”), the financial institutions set forth on the
signature pages hereto (each a “Lender” and collectively, “Lenders”) and
Praesidian Capital Opportunity Fund III, LP as agent for Lenders (in such
capacity, “Agent”).
 
BACKGROUND

WHEREAS, Credit Parties, Lenders and Agent are parties to a Second Amended and
Restated Securities Purchase Agreement and Security Agreement, dated as of
October 31, 2014 (as amended, restated, supplemented or otherwise modified from
time to time, the “Loan Agreement”), pursuant to which Agent and Lenders provide
Borrower with certain financial accommodations; and
 
WHEREAS, Credit Parties have requested that Agent and Lenders waive Events of
Default that have occurred and amend certain provisions of the Loan Agreement
and Agent and Lenders are willing to do so on the terms and conditions
hereinafter set forth.
 
NOW, THEREFORE, in consideration of any loan or advance or grant of credit
heretofore or hereafter made to or for the account of Borrower by Agent and
Lenders, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
 
1. Definitions.  All capitalized terms not otherwise defined herein shall have
the meanings given to them in the Loan Agreement.
 
2. Waiver.  Credit Parties acknowledge that (a) the Parent failed to sell equity
interests in Parent, on terms reasonably satisfactory to Lenders, with net sale
proceeds of not less than $3,000,000 by July 31, 2015 and that such failure
constitutes an Event of Default under Section 11.01(c) of the Loan Agreement
(the “Parent Equity EOD”), (b) as of and for the period of four consecutive
fiscal quarters ended June 30, 2015, (i) the Fixed Charge Coverage Ratio was
1.34 to 1.00, which was less than the ratio permitted under Section 9.15(b) of
the Loan Agreement and that such failure constitutes an Event of Default under
Section 11.01(c) of the Loan Agreement (the “FCCR EOD”), and (ii) EBITDA was
approximately $12,300,000, which was less than the amount permitted under
Section 9.15(d) of the Loan Agreement and that such failure constitutes an Event
of Default under Section 11.01(c) of the Loan Agreement (the “EBITDA EOD”), and
(c) the Parent, on a non-Consolidated Basis, failed at all times during the
period from and after July 31, 2015 to the date hereof (the “Minimum Cash Waiver
Period”) to have at least $1,000,000 of Cash Equivalents in excess of the amount
of the Working Capital Loans then outstanding as required by Section 9.15(f) of
the Loan Agreement and that such failure constitutes an Event of Default under
Section 11.01(c) of the Loan Agreement (such failure during the Minimum Cash
Waiver Period, together with the Parent Equity EOD, the FCCR EOD and the EBITDA
EOD, collectively, the “Specified Events of Default”). Subject to satisfaction
of the conditions precedent set forth in Section 4 below, Agent and Lenders
hereby waive the Specified Events of Default.
 
3. Amendment of Financial Covenants. Subject to the satisfaction of the
conditions precedent set forth in Section 4 below, Sections 8.18(e) and 9.15(f)
of the Loan Agreement are hereby amended to read in their entirety as follows:
 
8.18(e) Not later than September 30, 2015, Parent shall sell equity interests in
Parent, on terms reasonably satisfactory to Lenders, with net sale proceeds of
not less than $3,000,000.
 
9.15(f) Minimum Cash.  The Parent, on a non-Consolidated Basis, shall at all
times from and after September 30, 2015 have at least $1,000,000 of Cash
Equivalents in excess of the amount of the Working Capital Loans then
outstanding
 
4. Conditions of Effectiveness.  This Amendment shall become effective upon
satisfaction of the following conditions precedent:  Agent shall have received
(i) four (4) copies of this Amendment executed by the Credit Parties and
Lenders, and (ii) for the benefit of the applicable Lenders, Lenders’ costs and
expenses, including reasonably attorneys’ fees and expenses in connection with
this Amendment.
 
5. Representations and Warranties.  Each Credit Party hereby represents and
warrants as follows:
 
(a) This Amendment and the Loan Agreement constitute legal, valid and binding
obligations of each Credit Party and are enforceable against each Credit Party
in accordance with their respective terms, except as may be limited by
bankruptcy, insolvency, reorganization, arrangement, fraudulent conveyance or
transfer, moratorium or other laws of general application relating to or
affecting the enforcement of creditors’ rights generally or by general
principles of equity.
 
(b) Upon the effectiveness of this Amendment, each Credit Party hereby reaffirms
all covenants, representations and warranties made in the Loan Agreement, as
amended hereby, and agrees that all such covenants, representations and
warranties shall be deemed to have been remade as of the effective date of this
Amendment.
 
 
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(c) No Event of Default or Default has occurred and is continuing immediately
prior to giving effect to this Amendment other than the Specified Events of
Default, and no Event of Default or Default has occurred and is continuing or
would exist after giving effect to this Amendment.
 
(d) No Credit Party has any defense, counterclaim or offset with respect to the
Loan Agreement.
 
6. Amendment Fee. If the Obligations (other than contingent Obligations for
which no claim has been asserted) owing to Plexus (as defined below) are not
paid in full by August 20, 2015, Borrower shall, no later than August 30, 2015,
pay to Lenders amendment fees equal to (a) $50,000  in the aggregate in the case
of Plexus Fund II, L.P. Plexus Fund III, L.P. and Plexus Fund QP III, L.P
(collectively, “Plexus”), (b) $50,000 in the aggregate in the case of Praesidian
Capital Opportunity Fund III, LP and Praesidian Capital Opportunity Fund III-A,
LP, and (c) $13,600 in the case of United Insurance Company of America.
 
7. Effect on the Loan Agreement.
 
(a) The Loan Agreement, and all other documents, instruments and agreements
executed and/or delivered in connection therewith, as amended hereby, shall
remain in full force and effect, and are hereby ratified and confirmed.
 
(b) Except as expressly provided in Sections 2 and 3, the execution, delivery
and effectiveness of this Amendment shall not operate as a waiver or other
modification of any right, power or remedy of Agent or Lenders, nor constitute a
waiver or other modification of any provision of the Loan Agreement, or any
other documents, instruments or agreements executed and/or delivered under or in
connection therewith.
 
(c) This Amendment shall be a Transaction Document for all purposes under the
Loan Agreement.
 
(d) This Amendment applies solely with respect to the Specified Events of
Default and does not apply to, or constitute a waiver or other modification of,
any other Default or Event of Default that exists or may exist under the Loan
Agreement or any of the other Transaction Documents, including, without
limitation, the Credit Parties’ failure to comply with the covenants set forth
in Sections 8.18(e) and 9.15(f) of the Loan Agreement, as modified
hereby.  Except with respect to the Specified Events of Default, such
modification does not (x) constitute a waiver of compliance by any Credit Party
with respect to any other term, provision or condition of the Loan Agreement or
any other Transaction Document, or any other instrument or agreement referred to
therein; or (y) prejudice any right or remedy that Lenders and Agent may now
have or may have in the future under or in connection with the Loan Agreement or
any other Transaction Document.
 
8. GOVERNING LAW.  THIS AMENDMENT SHALL BE BINDING UPON AND INURE TO THE BENEFIT
OF THE PARTIES HERETO AND THEIR RESPECTIVE SUCCESSORS AND ASSIGNS AND SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD RESULT IN
THE APPLICATION OF THE LAW OF ANY OTHER JURISDICTION.
 
9. Release.  In consideration of the agreements of Agent and Lenders contained
herein, each Credit Party on behalf of itself and its successors, assigns, and
other legal representatives, hereby, jointly and severally, absolutely,
unconditionally and irrevocably releases, remises and forever discharges Agent
and each Lender, and their present and former shareholders, affiliates,
subsidiaries, divisions, predecessors, directors, officers, attorneys,
employees, agents and other representatives and their respective successors and
assigns (Agent, each Lender and all such other parties being hereinafter
referred to collectively as the “Releasees” and individually as a “Releasee”),
of and from all demands, actions, causes of action, suits, covenants, contracts,
controversies, agreements, promises, sums of money, accounts, bills, reckonings,
damages and any and all other claims, counterclaims, defenses, rights of
set-off, demands and liabilities whatsoever (individually, a “Claim” and
collectively, “Claims”) of every name and nature, known or unknown, suspected or
unsuspected, both at law and in equity, whether liquidated or unliquidated,
matured or unmatured, asserted or unasserted, fixed or contingent, foreseen or
unforeseen and anticipated or unanticipated, which such Credit Party, or any of
its successors, assigns, or other legal representatives and its successors and
assigns may now or hereafter own, hold, have or claim to have against the
Releasees or any of them for, upon, or by reason of any nature, cause or thing
whatsoever which arises at any time on or prior to the day and date of this
Amendment, in relation to, or in any way in connection with the Loan Agreement,
as amended and supplemented through the date hereof, this Amendment and the
Transaction Documents.
 
10. Headings.  Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
 
11. Counterparts; Facsimile.  This Amendment may be executed by the parties
hereto in one or more counterparts, each of which shall be deemed an original
and all of which when taken together shall constitute one and the same
agreement.  Any signature delivered by a party by facsimile transmission or
electronic transmission of a “pdf” or similar file shall be deemed to be an
original signature hereto.
 
[Signature Pages Follows]
 
 
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IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year
first written above.
 

Borrower: FUSION NBS ACQUISITION CORP.          
 
By:
/s/ Gordon Hutchins, Jr.       Gordon Hutchins, Jr.       President            
     
Guarantors:
FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.
            By: /s/ Gordon Hutchins, Jr.       Gordon Hutchins, Jr.      
President                     NETWORK BILLING SYSTEMS, LLC             By: /s/
Gordon Hutchins, Jr.       Gordon Hutchins, Jr.       Executive Vice President  
                  FUSION BVX LLC             By: /s/ Gordon Hutchins, Jr.      
Gordon Hutchins, Jr.       President                     FUSION PTC ACQUISITION,
INC.             By: /s/ Gordon Hutchins, Jr.       Gordon Hutchins, Jr.      
President                     PINGTONE COMMUNICATIONS, INC.             By: /s/
Gordon Hutchins, Jr.       Gordon Hutchins, Jr.       President  

 
[SIGNATURE PAGE TO WAIVER AND THIRD AMENDMENT TO SECOND AMENDED AND RESTATED
SECURITIES PURCHASE AGREEMENT AND SECURITY AGREEMENT]
 
 
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Lenders:
PRAESIDIAN CAPITAL OPPORTUNITY FUND III, L.P.
         
 
By:
Capital Opportunity GP III, LLC,
      its General Partner                    
By:
/s/ Jason D. Dratell       Jason D. Dratell       Manager                    
PRAESIDIAN CAPITAL OPPORTUNITY FUND III-A, L.P.            
By:
Praesidian Capital Opportunity GP III-A, LLC,       its General Partner        
           
By:
/s/ Jason D. Dratell       Jason D. Dratell       Manager                    
PLEXUS FUND II, LP
           
By:
Plexus Fund II GP,      
its General Partner
                   
By:
/s/ Robert R. Anders, Jr.       Robert R. Anders, Jr.       Manager            
        PLEXUS FUND III, L.P.            
By:
Plexus Fund III GP, LLC       its General Partner            
By:
/s/ Robert R. Anders, Jr.       Robert R. Anders, Jr.       Manager  

 
[SIGNATURE PAGE TO WAIVER AND THIRD AMENDMENT TO SECOND AMENDED AND RESTATED
SECURITIES PURCHASE AGREEMENT AND SECURITY AGREEMENT]
 
 
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  PLEXUS FUND QP III, L.P.          
 
By:
Plexus Fund III GP, LLC       its General Partner                    
By:
/s/ Robert R. Anders, Jr.       Robert R. Anders, Jr.       Manager            
        UNITED INSURANCE COMPANY OF AMERICA            
By:
/s/ John Boschelli       John Boschelli       Assistant Treasurer          

 
 

[SIGNATURE PAGE TO WAIVER AND THIRD AMENDMENT TO SECOND AMENDED AND RESTATED
SECURITIES PURCHASE AGREEMENT AND SECURITY AGREEMENT]
 
 
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Agent:
PRAESIDIAN CAPITAL OPPORTUNITY FUND III, L.P.          
 
By:
Praesidian Capital Opportunity GP III, LLC,      
its General Partner
                   
By:
/s/ Jason D. Dratell       Jason D. Dratell       Manager          

[SIGNATURE PAGE TO WAIVER AND THIRD AMENDMENT TO SECOND AMENDED AND RESTATED
SECURITIES PURCHASE AGREEMENT AND SECURITY AGREEMENT]
 
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