EXECUTION
VERSION

    


    SALES
AGENCY AGREEMENT

    


    THIS AGREEMENT, dated as of
September 27, 2010, by and between deltathree, Inc., a Delaware corporation
(“Inc.”), DME Solutions, Inc., a New York corporation (“DME”), and Delta Three
Israel, Ltd., an Israeli corporation (“Delta Three Israel”) (Inc., DME and Delta
Three Israel are collectively referred to herein as “deltathree”), and LKN
Communications, Inc., doing business as ACN, Inc. (“ACN”), a Michigan
corporation.

    


    EXPLANATORY
STATEMENT

    


    deltathree
is a company that markets and sells telecommunications services throughout the
world.  LKN is the holding company for a group of companies that
together are a leading global network marketing company with relationships with
hundreds of thousands of independent sales representatives.  ACN has
over the years marketed and sold telecommunications services in various
geographic areas, both under its own brand and as a sales agent.

    


    Inc. and
ACN wish to deploy ACN’s sales and marketing experience and expertise in order
to build Inc.’s business, and to that end, have agreed that they will enter into
a definitive agreement for ACN to act as a master agent, and for ACN’s network
of independent sales representatives (the “Representatives”) to act as limited
agents for Inc. to sell Inc.’s application download and callback voice
termination mobile application services (the “Mobile Applications”) to retail
residential and commercial consumers.

    


    NOW, THEREFORE, in
consideration of the mutual covenants contained herein and for other good and
valuable consideration set forth herein, the sufficiency of which is hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:

    


    1. Defined
Terms. The following terms used herein shall have the meaning ascribed to
them below:

    


    “ACN
Commission” shall have the meaning ascribed to such term in Section
6(a).

    


    “ACN
Costs” shall mean the total of the (i) Commissions to be paid by ACN, estimated
to be equal to 9.5% of Revenues and subject to adjustment as set forth in
Section 6(b) below, and (ii) costs incurred by ACN in providing the call center
and services to be provided under Section 4(b) below, estimated to be equal to
2.0% of Revenues and subject to adjustment as set forth in Section 6(b)
below.

    


    “ACN
Indemnified Person” shall have the meaning ascribed to such term in Section
11(b).

    


    “ACN
Customers” shall mean those customers whose orders are entered into the Online
Portal by ACN, or the Representatives, or their customers under this Agreement,
whose orders are accepted by Inc.


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


    “Agency
Period” shall have the meaning ascribed to such term in Section
3(a).

    


    “Business”
shall have the meaning given to it in Section 2(a), below.

    


    “Commissions”
shall mean the compensation that ACN pays to the Representatives for producing
ACN Customers.

    


    “deltathree
Costs” shall mean the total of the (i) network costs, estimated to be equal to
2.5% of Revenues and subject to adjustment as set forth in Section 6(b) below,
(ii) termination costs, as calculated by deltathree on a monthly
basis,  and (iii) credit card service and credit card vendor costs
incurred by deltathree in providing the service hereunder to the ACN Customers,
estimated to be equal to 3.5% of Revenues and subject to adjustment as set forth
in Section 6(b) below.

    


    “Gross
Margin” shall mean the difference between Revenue minus (i) the deltathree Costs
and (ii) the ACN Costs.

    


    “Inc.
Indemnified Person” shall have the meaning ascribed to such term in Section
11(a).

    


    “Initial
Agency Period” shall have the meaning ascribed to such term in Section
3(a).

    


    “Insolvency
Event” shall mean that Inc., DME or Delta Three Israel:

    


    (a) files
any petition or action for relief under any bankruptcy, reorganization,
insolvency or moratorium law, or any other law for the relief of, or relating
to, debtors, now or hereafter in effect;

    


    (b)  applies
for or consents to the appointment of a custodian, receiver, trustee,
sequestrator, conservator or similar official for Inc., DME or Delta Three
Israel or for a substantial part of their assets;

    


    (c)   makes a general
assignment for the benefit of creditors;

    


    (d)  becomes
unable to, or admits in writing its inability to, pay its debts generally as
they come due;

    


    (e)   takes any action
in furtherance of any of the foregoing; or

    


    (f)  has filed against them
an involuntary petition, which petition is not dismissed or discharged within 60
days of its filing, under any bankruptcy statute now or hereafter in effect, of
custodian, receiver, trustee, sequestrator, conservator, assignee for the
benefit of creditors or other similar official is appointed to take possession,
custody or control of the property of Inc., DME or Delta Three
Israel.


    
      
         


      

      
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    “Mobile
Applications” shall have the meaning ascribed to such term in the Explanatory
Statement

    


    “Online
Portal” shall mean the web-based order entry portal created by Inc. pursuant to
Section 5(i).

    


    “Representatives”
shall have the meaning ascribed to such term in the Explanatory
Statement.

    


    “Revenues”
shall mean the total revenue from ACN Customers in connection with deltathree
providing the services hereunder recognized by deltathree for financial
reporting purposes under generally accepted accounting principles.

    


    “Standards”
shall have the meaning ascribed to such term in Section 2(a).

    


     “Termination
Date” shall have the meaning given to it in Section 3(b).

     

    2. Sales
Agency.

    


    (a)
During the Agency Period, ACN shall provide, or cause to be provided, to Inc.
ACN’s network of Representatives to act as limited agents for Inc. to sell
Mobile Applications on behalf of and for the benefit of Inc. ACN shall use its
commercially reasonable efforts to cause the Representatives: (i) to sell Mobile
Applications and otherwise promote Inc.’s mobile application business (the
“Business”), and (ii) to act as agents for the sale of Mobile Applications, for
and on behalf of Inc. Inc. shall have the right to cause ACN to direct the
Representatives with respect to sales of Mobile Applications, customer service
and regulatory matters in accordance with Inc.'s licenses or certificates, the
statutes, rules, regulations, or policies of the applicable jurisdictions in
which Inc. has authorized ACN and the Representatives to conduct customer
acquisition activities (the “Standards”), but in no event shall it have the
right to cause ACN to take any actions (or inaction) with respect to management
and oversight of, or the Commissions or other fees paid or payable to, the
Representatives.

    


    (b) ACN
shall be responsible for directing the Representatives to adhere to the
Standards in selling the Mobile Applications and otherwise in connection with
the performance of any obligations of ACN under this Agreement. Neither ACN nor
the Representatives shall have the power or authority to act as attorney-in-fact
of Inc. or bind Inc. in any way without the prior written consent of Inc. All
customers acquired by the Representatives shall be subject to acceptance by
Inc.

    


    (c) ACN's
and the Representatives’ agency on behalf of Inc. shall be limited to the
following acts: (i) solicitation of customers, (ii) the offering of Inc.'s
Mobile Applications as set forth in Inc.’s marketing materials, applications,
and sales agreements, and/or (iii) recommending Inc.'s Mobile Applications to
retail customers.


    
      
         


      

      
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    (d) ACN's
and the Representatives' limited agency shall not include (i) the negotiation of
prices or rates, terms or conditions of service for Inc.'s Mobile Applications,
(ii) taking title to Mobile Applications, (iii) arranging for the purchase,
transportation, scheduling or delivery of Mobile Applications, or (iv) execution
of contracts or agreements on behalf of Inc.

    


    (e) Inc.
shall have the right to cause ACN to take appropriate actions with respect to
the conduct of a Representative in order to comply with a notice or inquiry of
any applicable Governmental Authority by providing at least 5 days' prior
written notice (or such lesser period of notice as may be required by such
Governmental Authority) to ACN specifying the applicable remedial or corrective
actions required by the Governmental Authority.

    


    (f) ACN
shall provide Inc. with true and complete copies of all independent
representative form agreements and updates thereto from time to time, upon
Inc.’s request for same.

    


    (g) In
performing this Agreement, ACN agrees to (i)(A) not take any actions that it
knows would be harmful in any material respect to the Business of Inc., (B) use
its commercially reasonable efforts to promote the Business, and (C) comply with
all applicable telecommunications, federal, provincial and local laws, the
Standards, and Inc.'s policies and procedures established in accordance with
Section 5(a) hereof as in effect from time to time, and (ii) recognizing that
ACN’s legal relationship with the Representatives is that of independent
contractor, use its commercially reasonable efforts to cause the Representatives
to do (or not to do, as applicable) the same.

    


    3. Agency
Period; Termination; Wind Down Phase.

    


    (a) This
Agreement is effective as of the date hereof and shall continue for a period of
two (2) years (the “Initial Agency Period”) or until earlier terminated as
provided herein. Upon the expiration of the Initial Agency Period, this
Agreement shall automatically renew on a year-to-year basis unless terminated by
either Inc. or ACN by the giving of written notice of termination to the other
party hereto at least three (3) months prior to the expiration of the Initial
Agency Period, or any successive term, as the case may be. The Initial Agency
Period and any successive term(s) shall be together referred to herein as the
“Agency Period.”

    


    (b) This
Agreement may be terminated at any time prior to the expiration of the Agency
Period or any successive term, as the case may be, by any of the
following:

    


    (i)           by
mutual written agreement of the parties;

    


    (ii)          by
either party upon the occurrence of a material breach by the other party that
remains uncured for a period of thirty (30) days after the breaching party
receives written notice describing the breach in reasonable detail from the
non-breaching party; or


    
      
         


      

      
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    (iii)         by
the giving of proper notice as set forth in Section 3(a), above.

    


    In all
cases of notice given to terminate under this Section 3(b), the party giving
notice shall specify the date on which this Agreement shall terminate (the
“Termination Date”).

    


    (c) In
the case of termination other than as provided in Section 3(b)(ii),
notwithstanding any other provision of this Agreement, any such termination
shall be without liability to either party, and shall be managed in compliance
with the provisions of Section 3(d), below. Any termination as provided in
Section 3(b)(ii) shall be without prejudice to the non-breaching party's right
to seek damages for such breach.

    


    (d) Upon
termination of this Agreement, this Agreement will enter a wind down phase in
which the parties will cooperate to achieve an orderly and gradual cessation (in
whatever Agency Period remains) of the Representatives’ marketing and making
sales of the Mobile Applications, including the joint and mutually agreeable
development of the messaging of such event to the Representatives, and the
management of their expectations regarding receiving the Commissions, which will
remain ACN’s obligation to remit. ACN will cause the Representatives to cease
marketing and selling the Mobile Applications on the Termination Date, but Inc.
agrees that it will continue to accept, process, provision and make ACN
Commission payments to ACN, and continue customary .xml file reporting, on all
orders entered through the Online Portal up through and including the
Termination Date.  After the Termination Date, Inc. will continue to
pay to ACN the ACN Commission payments under Section 6 of this Agreement, and
provide the customary .xml file required by Section
5(e), below, for as long as ACN Customers continue to purchase the Mobile
Applications, and this Agreement will continue in effect as to the remaining
‘tail’ of these ACN Customers’ usage, until there remain no ACN Customers using
Mobile Applications.

    


    (e) Inc.
agrees that during the time this Agreement remains in effect, including the time
during any wind down period and/or after the Termination Date while there remain
active ACN Customers, regardless of what Mobile Application they consume,
regardless of who sold such Mobile Application to them, Inc. will pay to ACN the
ACN Commission payments and, if applicable by circumstances, the Commissions
ramp down on their aggregate usage, and will continue to provide the customary
.xml file required by
Section 5(e).  Inc. will not actively seek to cause ACN Customers to
change the Mobile Applications they purchase (with ‘upselling’ to additional
Mobile Applications being permitted, but ACN Commission and Commission ramp down
payments, if applicable by circumstances, being due thereon), will not change
the account numbers or other unique identifier developed inside of Inc.’s
systems to identify customers as ACN Customers, or otherwise attempt to disguise
or cull out of the ranks of ACN Customers any faster than they would otherwise
out of normal customer-initiated attrition.


    
      
         


      

      
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    4. Duties of
ACN. ACN will use its commercially reasonable efforts to cause the
Representatives to sell standard offer contracts of the Business as approved by
Inc. to pre-approved customer credit classes; and will perform the following
functions:

    


    (a) ACN
will process, reconcile, and make payments to Representatives of Commissions out
of ACN’s Commission;

    


    (b) ACN
will maintain, in accordance with its customary practice, a call center facility
with an adequate number of trained CSRs available to answer inbound calls from
the Representatives (i) relating to Commissions and other Representative issues
and (ii) to provide Tier 1 and Tier 2 support to answer technical questions
relating to the Mobile Applications;

    


    (c) ACN
will give Inc. access to ACN's Representative training events and gatherings at
which ACN's other training and product/service familiarization is scheduled to
occur, as Inc. and ACN may mutually agree, so that Inc. may assist ACN in
training the Representatives about the Mobile Applications, on Inc.’s processes
and procedures to sell the Mobile Applications, and in showcasing the Mobile
Applications to the Representatives;

    


    (d) ACN
and Inc. will from time to time develop together, and Inc. will provide to the
Representatives, material for presentation through ACN's website area(s) serving
the Representatives, including potential links to Inc.'s website area(s),
designed to inform the Representatives about Mobile Applications available for
Representatives to sell;

    


    (e) ACN
will use its commercially reasonable efforts to promote the agency relationship
created hereunder to the Representatives;

    


    (f) ACN
will designate an individual to be the primary interface between ACN and Inc. on
all issues relating to this Agreement, including understanding the Mobile
Applications, answering mobile applications sales questions and generally
assisting with the relationship between the two organizations (ACN and Inc.)
with respect to activities under this Agreement;

    


    (g) ACN
and Inc. will together prepare a training package suitable for ACN to use in
educating the Representatives on the Mobile Applications so as to enable them to
represent Inc. well; and

    


    (h) ACN
will obtain and maintain any licenses or certificates required to perform its
obligations under this Agreement.

    


    5. Duties of
Inc. Inc. shall provide Mobile Applications for the Representatives to
sell in accordance with the following terms:

    


    (a) Inc.
shall determine all Mobile Applications, their terms of service, as well as
establish the policies and procedures for the Representatives to sell the Mobile
Applications, with all of the foregoing being subject to ACN’s input and
suggestions;


    
      
         


      

      
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    (b) Inc.
shall, together with ACN, price the Mobile Applications for retail sale
competitively and keep same current;

    


    (c) Inc.
shall undertake, be responsible for, and bear all risk on, all business
functions relating to ACN Customers, including, but not limited to, order entry,
provisioning, billing, collections;

    


    (d) Inc.
shall assist ACN in preparing a training package suitable for ACN to use in
educating the Representatives on the Mobile Applications so as to enable them to
represent Inc. well;

    


    (e) Inc.
shall provide ACN with an .xml electronic file of ACN
Customer activity and status, including disconnects, no less frequently than
once daily, in a  reasonably satisfactory to ACN and designed by ACN
and Inc. together to allow ACN access to the information it needs to calculate
and verify properly the Commissions, and administer its programs with the
Representative, which file will remain extant and accessible even after an ACN
Customer’s contract termination and for as long as there remain active ACN
Customers;

    


    (f) Inc.
shall be entitled to provide training for Representatives at such times as may
be reasonably acceptable to ACN at ACN's Representative training events and
gatherings at which ACN's other training and product/service familiarization is
scheduled to occur;

    


    (g) Inc.
shall provide all product literature, contractual forms, and any other materials
needed for the Representatives (including web-based information) to be able to
market and sell the Mobile Applications;

    


    (h) Inc.
will designate an individual to be the primary interface between ACN and Inc. on
all issues relating to this Agreement, including understanding the Mobile
Applications, answering mobile application questions and generally assisting
with the relationship between the two organizations (ACN and Inc.) with respect
to activities under this Agreement;

    


    (i) Inc.
will design, provide and host a mutually agreeable co-branded online order entry
portal that the Representatives and their customers will use to place customer
orders for acceptance by Inc., which orders shall bear some unique identifier
inside of Inc.’s systems as ACN-sourced as well as the unique identifier or team
identification number inside ACN’s systems of the Representative submitting or
responsible for such order;

    


    (j) Inc.
will design, to the mutual satisfaction of Inc. and ACN, a ‘Commission Report’
that details the information called for by Section 6(a), below;


    
      
         


      

      
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    (k) Inc.
will maintain an adequate number of trained Network Operation Center
representatives for the purpose of providing Tier 3 and Tier 4 support to ACN’s
CSRs to call to obtain answers to technical questions relating to the Mobile
Applications;

    


    (l) Inc.
will promptly use its best efforts to supply the Mobile Applications to the ACN
Customers;

    


    (m) Inc.
will use its best efforts to cause its Mobile Applications to be available for
sale on or before October 1, 2010; and

    


    (n) Inc.
will comply with all applicable telecommunications, federal, state and local
laws necessary to satisfy the purposes of this Agreement.

    


    6. ACN’s
Commission.

    


    (a)  Inc.
and ACN shall agree upon a retail price at which Mobile Applications will be
offered by ACN to potential ACN Customers (the “Retail Price”).  The
parties shall meet on a regular basis to determine whether the Retail Price of
any particular Mobile Application(s) is/are appropriate for market conditions
and may mutually agree to increase or decrease (i) the Retail Price for any
product(s) and/or (ii) the ACN Commission set forth below.

    


    Inc.
shall pay to ACN as consideration for ACN’s performance of its duties and
obligations under this Agreement an amount of money equal to fifty percent (50%)
of the Gross Margin (the “ACN Commission”). At the conclusion of each calendar
month, Inc. shall calculate the ACN Commission and pay to ACN by wire transfer,
on or before the 15th day of
the end of such month, an amount of money equal to the ACN
Commission.  Additionally, Inc. warrants that in the event that Inc.
offers another agent and/or business partner consideration whereby the aggregate
resulting gross margin paid to said agent and/or business partner exceeds that
which is paid to ACN under this provision that Inc. shall adjust the
consideration paid to ACN to equal that of the other agent and/or business
partner.

    


    (b)
Within thirty (30) days following the completion of each six-month period, ACN
shall calculate the ACN Costs and deltathree shall calculate the deltathree
Costs for the preceding six-month period and each of the parties shall forward
to the other party a report setting forth in reasonable detail such calculation.
In the event that any adjustment to the ACN Costs and/or the deltathree Costs
and, accordingly, the aggregate amount paid by deltathree to ACN for such
six-month period is required, deltathree shall include such adjustment in the
calculation of the monthly payment (or, if necessary, payments) it is required
to make to ACN immediately following the completion of such
calculation.  Such revised calculation of the ACN Costs and/or the
deltathree Costs (as applicable) shall serve as the estimate of the ACN Costs
and/or the deltathree Costs (as applicable) for the following six-month
period.


    
      
         


      

      
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    (c) All
ACN Commission payments shall be made by Inc. directly to ACN. ACN shall be
solely liable for the payment of any and all compensation of whatever kind to
the Representatives. To the extent required, ACN shall, in accordance with its
normal and customary practice, issue an IRS Form 1099 or Revenue Canada Form T4A
to each of the Representatives with respect to any Commissions that any of the
Representatives are paid by ACN for the sale of Mobile
Applications.

    


    (d) If an
ACN Customer disputes the validity of a contract, Inc. shall continue to pay any
associated ACN Commission payments while that ACN Customer continues to flow;
provided, however, if the basis of the dispute relates to or is connected with
the conduct of ACN or its representatives in securing that ACN Customer
contract, then Inc. shall withhold any ACN Commission payments until such time
as it is determined that that ACN Customer Contract is valid.

    


    7. Exclusivity.

    


    (a) The
parties  agree that, during the Agency Period, Inc. shall not appoint
or permit the following network marketing, multi-level marketing company or
direct selling company (other than Inc. itself) to market and sell Mobile
Applications on behalf of Inc. or any of its affiliates: Momentis; 5Linx; and
Lightyear Network Solutions.

    


    (b)
Subject to the foregoing restrictions in Section 7(a), above, nothing herein or
otherwise shall prevent ACN or Inc., as applicable, from pursing or entering
into any relationship of any nature or kind with any other supplier or vendor,
of whatever type of product or service.

    


    8.   Audit
Rights.

    


    ACN shall
have the right, at any time upon reasonable advance notice to Inc., and during
customary business hours, to audit Inc.’s customer and sales revenue accounting
records and applicable transaction documents in order: (i) to verify any report
provided to ACN by Inc. in connection with this Agreement or (ii) to verify any
calculation, payment of, or proposed payment of, ACN Commission to ACN, and Inc.
shall have the right, at any time upon reasonable advance notice to ACN, and
during customary business hours, to audit ACN’s Commission and call center
accounting records and applicable transaction documents in order to verify any
report provided to Inc. by ACN in connection with this
Agreement.  Subject to any restrictions imposed by applicable law, ACN
shall also have the right to request customer detail records, and Inc. shall
promptly provide the same to ACN.  Neither party shall delay unduly or
otherwise attempt to frustrate the other party’s verification
efforts.  All information provided to a party by the other party,
whether under this Section 8 or otherwise under this Agreement, shall be
prepared with full transparency by the providing party, and shall be full,
complete, truthful and not misleading when delivered to the receiving
party.  Each of the party’s rights under this section shall continue
and remain in effect until there are no longer any active ACN
Customers.


    
      
         


      

      
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    ACN
acknowledges that certain of the information that Inc. may provide in respect of
ACN’s audit rights may contain personal information of the ACN Customers and ACN
agrees to use its reasonable commercial efforts to protect and maintain the
confidentiality of such information, not to disclose the information to any
third parties and use such information for the sole and limited purpose of the
verifications set out in (i) through (iii) above; and in any event, ACN agrees
to treat such confidential information with the same care that it treats the
information of its own, non-Inc. related customers similar
information.

    


    9.  Representations
and Warranties.

    


    Each of
the parties hereto represents and warrants to the other that:

    


    (a) it is
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has the requisite power and authority to
execute, deliver, and perform this Agreement;

    


    (b) this
Agreement, once executed, will constitute a valid and binding agreement of each
party, enforceable in accordance with its terms, subject to bankruptcy,
insolvency and other similar laws affecting the enforcement of creditors’ rights
in general, and subject to general principles of equity;

    


    (c) this
Agreement has been duly authorized by all necessary action on the part of each
party;

    


    (d) it
possesses all licenses, certificates, permits or other similar permissions
necessary to perform its obligations under this Agreement; and

    


    (e)
neither the execution and delivery of this Agreement, nor each of the parties’
performance hereunder, will violate any injunction, judgment, order, decree,
ruling charge, government restriction, rule or law, nor will they conflict with,
result in a material breach of, constitute a default under, or cause or create
any acceleration, cancellation, or modification of any other agreement or
arrangement to which each party is a party.

    


    10. Confidential
Information.

    


    The
parties agree that the provisions of the Nondisclosure Agreement between the
parties dated as of September 2, 2010, shall be deemed to be in full force and
effect and shall be deemed incorporated herein, and each of the parties shall
act in accordance with the terms and conditions thereof.


    
      
         


      

      
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    11. Indemnification.

    


    (a) ACN
hereby agrees to indemnify and hold Inc. and its directors, officers, employees,
stockholders, affiliates and agents (each, an “Inc. Indemnified Person”)
harmless from and against all damages which any Inc. Indemnified Person may
sustain, incur or assume as a result of any allegation, claim, civil or criminal
action, proceeding, charge or prosecution which may be alleged, made, instituted
or maintained against any Inc. Indemnified Person arising out of, resulting from
or based upon (i) any breach by ACN of any of its representations, warranties,
covenants or agreements contained in this Agreement, or (ii) any claim asserted
or threatened to be asserted by any third party in connection with ACN, its
affiliates or the Representatives, selling the Mobile Applications or serving or
having served pursuant to this Agreement; provided, however, ACN shall not be
liable to indemnify and hold any Inc. Indemnified Person harmless from any such
damages to the extent it is the result of the gross negligence, bad faith,
willful misconduct or criminal conduct of, or the breach of this Agreement by,
the party seeking indemnification hereunder.

    


    (b) Inc.
hereby agrees to indemnify and hold ACN and its directors, officers, employees,
stockholders, affiliates and agents (each, an “ACN Indemnified Person” and
collectively, the “ACN Indemnified Persons”) harmless from and against all
damages which any ACN Indemnified Person may sustain, incur or assume as a
result of any allegation, claim, civil or criminal action, proceeding, charge or
prosecution which may be alleged, made, instituted or maintained against any ACN
arising out of, resulting from or based upon (i) any breach by Inc. of any of
its representations, warranties, covenants or agreements contained in this
Agreement, or (ii) any claim asserted or threatened to be asserted by any third
party in connection with Inc.'s obligations pursuant to this Agreement, in each
case solely to the extent that any such damages is the direct result of the
gross negligence, bad faith, willful misconduct or criminal conduct with respect
to any training, sales materials, literature, forms or documents provided by
Inc. for use by the Representatives of, or the breach of this Agreement by, any
of the Inc. Indemnified Persons.

    


    (c) Inc.
acknowledges that the Representatives are third party beneficiaries of this
Agreement, and that ACN is permitted to bring any claim under this Agreement
that may arise on their behalf.

    


    12. Independent
Contractors. The parties
acknowledge that they are entering into this Agreement as independent
contractors and that this Agreement shall not create nor be construed to create
a relationship of joint venturers, co-partners, employer and employee, master
and servant or any similar relationship among the parties.

    


    13. Expenses.
Except as otherwise provided for herein, each party will pay its own expenses in
connection with this Agreement and the completion of the transactions
contemplated hereby.

    


    14. Expenses
Related to Audit Rights. Wherever either party has an audit right, the
party exercising its audit right shall be entitled to reimbursement of its
reasonable and customary expenses associated with such audit from the other
party in the event such audit results in a determination that there was a
material inaccuracy adverse to the party conducting the audit. Further, the
party being audited shall be entitled to reimbursement of its reasonable and
customary expenses associated with supporting such audit from the party
conducting the audit in the event such audit results in a determination that the
subject matter audited was materially accurate. Any inaccuracies determined by
any such audit shall be corrected in the favor of the party to whom the
inaccuracy was adverse.


    
      
         


      

      
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    15. Force
Majeure. In the event that war, fire, explosion, flood, accident, strike,
riot, act of governmental authority, act of terrorism, act of God or other
contingency beyond the reasonable control of either party causes cessation or
interruption of that party’s or the Representatives' performance hereunder,
performance shall be temporarily excused for the period of the disability,
without liability, provided that the party seeking excuse shall promptly, after
it has actual knowledge of the beginning of any excusable delay, notify the
other party of such delay, the reason therefore, and the probable duration and
consequence thereof.  The party seeking excuse shall use its
reasonable commercial efforts to resume performance of its obligations hereunder
with the least possible delay.

    


    16. Contractual
Nature of Obligations.  ACN acknowledges that its rights to ACN
Commission payments are contractual in nature, are not traditional security
interests and do not specifically attach to or encumber any assets of Inc., DME
or Delta Three Israel, including, without limitation, to the ACN Customer
contracts. ACN agrees that it will not assert or attempt to assert these rights
via any UCC-1 or similar filings.

    


    17.  Insolvency
of Inc.  In the event that an Insolvency Event occurs, Inc.
acknowledges that ACN is a general unsecured creditor of Inc., and agrees that,
in consideration for ACN having acknowledged herein that its rights to ACN
Commission payments is unsecured and not attached to any specific assets, Inc.
will use its best efforts to protect ACN’s twin rights to the fullest extent
possible in both the case where the Insolvency Event is instigated by Inc. or is
suffered by Inc. at the hands of any third party.  Examples of the
best efforts that Inc. could use in this instance would include, but not be
limited to, obtaining protection for payments to ACN in any negotiations with
other or secured creditors or debtor-in-possession or other post-filing lenders,
placing this Agreement high upon the list of contracts to be assumed in any
reorganization proceeding offering that option, or otherwise acting to preserve
both the relationship created by this Agreement, the payments to ACN hereunder
and the ability for ACN to realize the value and equity that its efforts
hereunder have created.  Inc. specifically agrees that ACN shall have
the right to intervene in any Insolvency Event proceeding to that same
end.

    


    18.  Miscellaneous.

    


    (a)
Entire Agreement; Amendment; Waiver. This Agreement contains the entire
understanding of the parties as to the subject matter hereof and fully
supersedes all prior agreements and understandings between the parties as to
such subject matter. This Agreement may not be amended, supplemented, canceled
or discharged, except by a written instrument executed by the party as to whom
enforcement is sought. No failure to exercise, and no delay in exercising, any
right, power or privilege hereunder shall operate as a waiver thereof. No waiver
of any breach of this Agreement shall be deemed to be a waiver of any preceding
or succeeding breach of this Agreement.


    
      
         


      

      
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    (b)
Severability. The parties acknowledge that the terms of this Agreement are fair
and reasonable at the date signed by them. However, in light of the possibility
of a change of conditions or differing interpretations by a court of what is
fair and reasonable, the parties stipulate as follows: if any one or more of the
terms, provisions, covenants or restrictions of this Agreement shall be
determined by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated; further, if any one or more of
the terms, provisions, covenants, and restrictions contained in this Agreement
shall for any reason be determined by a court of competent jurisdiction to be
excessively broad as to duration, geographical scope, activity or subject, it
shall be construed, by limiting or reducing it, so as to be enforceable to the
maximum extent compatible with then applicable law.

    


    (c)
Notices. All notices, requests, demands and other communications provided for by
this Agreement shall be in writing and mailed in the United States enclosed in a
registered or certified post-paid envelope, return receipt requested, or
delivered by overnight courier service, and addressed to the addresses of the
respective parties as set forth below, or to such changed addresses as such
parties may fix by notice in accordance therewith:

    


    To
Inc.:

    


    deltathree,
Inc.

    224 West
35th
Street

    New York,
N.Y. 10001

    Attn:
Chief Executive Officer

    Attn:
General Counsel

    


    To
ACN:

    


    ACN,
Inc.

    1000
Progress Place

    Concord,
NC  28025  USA

    Attn:
Vice President – Business Development

    Attn:
General Counsel

    


    (d)
Successors and Assigns. Neither party may assign this Agreement without the
prior written consent of the other party; however, either party may assign this
Agreement to any affiliate without such consent.  Any attempt to
assign this Agreement not in conformance with the foregoing sentence shall be
void.  This Agreement shall be binding upon and inure to the benefit
of Inc. and its successors and assigns and upon and to the benefit of ACN and
its successors and assigns.


    
      
         


      

      
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    (e)
Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to principles of
conflict of laws.  In the event that any dispute shall have issues
needing resolution that arise out of the formation of an ACN Customer Contract,
then the laws of the province in which the ACN Customer resides may be applied
by the arbitrator, in his sole discretion, solely to answer questions regarding
the validity of that ACN Customer Contract, but all other issues shall be
governed by and construed in accordance with the laws of the State of New York,
without giving effect to principles of conflict of laws.

    


    (f)
Arbitration. Any claim, controversy or dispute between the parties shall be
resolved by binding arbitration of the issue in accordance with the following
procedures:

    


    (i)           Either
party may request arbitration by giving the other involved party written notice,
which notice shall describe, in reasonable detail, the nature of the dispute,
controversy or claim. The arbitration shall be governed by the rules of the
American Arbitration Association (“AAA”) and held in New York City, N.Y. or
other mutually agreed upon location.

    


    (ii)          If
both parties agree to an arbitrator within 30 days after a request for
arbitration is made hereunder, that arbitrator shall be selected to hear the
dispute in accordance with AAA rules. If the parties are not able to agree upon
an arbitrator within such 30 day period, then that party who requested
arbitration may request that the AAA select an arbitrator who has business
experience in the sales industry and the selected arbitrator shall hear the
dispute in accordance with AAA rules.

    


    (iii)         Each
of the parties shall bear its own fees, costs and expenses of the arbitration
and its own legal expenses, attorneys' fees and costs of all experts and
witnesses; provided, however, that if the claim of either party is upheld by the
arbitrator in all material respects, the arbitrator may apportion between the
parties as the arbitrator may deem equitable the costs incurred by the
prevailing party. The fees and expenses of the arbitration procedures, including
the fees of the arbitrator, will be shared equally by the parties.

    


    (iv)         Any
award rendered pursuant to an arbitration proceeding shall be final, conclusive,
non-appealable and binding upon the parties, and any judgment thereon may be
entered and enforced in any court of competent jurisdiction

    


    (g)
Headings. The headings in this Agreement are for convenience of reference only
and shall not control or affect the meaning or construction of this
Agreement,

    


    (h)
Further Assurances. Each party agrees at any time, and from time to time, to
execute, acknowledge, deliver and perform, and/or cause to be executed,
acknowledged, delivered and performed, all such further acts, deeds,
assignments, transfers, conveyances, powers of attorney and/or assurances as may
be necessary, and/or proper to carry out the provisions and/or intent of this
Agreement.


    
      
         


      

      
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    (i)
Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall be deemed an original and all such counterparts shall constitute
one and the same instrument.

    


    (j)
Survival.  The provisions of Sections 3(d), 3(e), 4(b), 4(h), 5(c),
5(e), 5(k), 5(n), 5(d), 8, 10, 11 and 18 shall survive the termination of this
Agreement for as long as there are active ACN Customers.

    


    [signatures
on next page]


    
      
         


      

      
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    IN WITNESS WHEREOF, the
parties have caused this Agreement to be duly executed on the day and year first
above written.

    


    
      
        	
                DELTATHREE,
      INC.

              	 
      
	 
      	 
      
	
                By: 

              	
                /s/ Effi Baruch

              	 
      
	
                Name:
      Effi Baruch

              	 
      
	
                Title:
      Interim CEO and President

              	 
      
	 
      	 
      
	
                DME
      SOLUTIONS, INC.

              	 
      
	 
      	 
      
	
                By:

              	
                /s/ Effi Baruch

              	 
      
	
                Name:
      Effi Baruch

              	 
      
	
                Title:
      CEO and President

              	 
      
	 
      	 
      
	
                DELTA
      THREE ISRAEL, LTD.

              	 
      
	 
      	 
      
	
                By:

              	
                /s/ Effi Baruch

              	 
      
	
                Name:
      Effi Baruch

              	 
      
	
                Title:
      Interim CEO and President

              	 
      
	 
      	 
      
	
                LKN
      COMMUNICATIONS, INC.

              	 
      
	
                d/b/a
      ACN, Inc.

              	 
      
	 
      	 
      
	
                By:

              	
                /s/ Robert Stevanovski

              	 
      
	
                Name:
      Robert Stevanovski

              	 
      
	
                Title:
      Chairman

              	 
      


      

    

     

    
      
         


      

      
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