Document:

Form of Warrant

 EXHIBIT 4.1 
  

EXHIBIT B 
  
 NEITHER THIS SECURITY NOR THE SECURITIES INTO WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL
TO THE TRANSFEROR REASONABLY ACCEPTABLE TO THE COMPANY TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. 
  
 WARRANT 
  
 To Purchase [            ] Shares of Common Stock of 
  
 i2 TELECOM INTERNATIONAL, INC. 
  
 THIS WARRANT (the “Warrant”) certifies that, for value received,
[                ] (the “Holder”), is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set
forth, at any time on or after July     , 2005 (the “Initial Exercise Date”) and on or prior to the third-year anniversary of the Initial Exercise Date (the “Termination Date”), but not
thereafter, to subscribe for and purchase from i2 Telecom International, Inc., a Washington corporation (the “Company”), up to [            ] shares (the
“Warrant Shares”) of common stock, no par value per share, of the Company (the “Common Stock”). The purchase price of one share of Common Stock (the “Exercise Price”) under this Warrant shall be
$0.60, subject to adjustment hereunder. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Company’s Certificate of Designations of Rights and Preferences of Preferred
Stock Series E, dated July     , 2005 and filed with the Secretary of the State of the State of Washington. 
  
 1. Title to Warrant. Prior to the Termination Date and subject to compliance with applicable laws and Section 7 of this Warrant, this Warrant
and all rights hereunder are transferable, in whole or in part, at the office or agency of the Company by the Holder in person or by duly authorized attorney, upon surrender of this Warrant together with the Assignment Form attached hereto as
Exhibit A (the “Assignment Form”), properly endorsed. 
  
 2. Authorization of Shares. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights
represented by this Warrant, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with
such issue). 

 3. Exercise of Warrant. 
  
 (a) Exercise of the purchase rights represented by this Warrant may be made at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of such Holder appearing on the books of
the Company) of a duly executed facsimile copy of the Notice of Exercise in the form attached hereto as Exhibit B (the “Notice of Exercise”); provided, however, within three (3) Business Days of the date
said Notice of Exercise is delivered to the Company, the Holder shall have surrendered this Warrant to the Company, and the Company shall have received payment of the aggregate Exercise Price of the shares thereby purchased by wire transfer or
cashier’s check drawn on a United States bank. Certificates for Warrant Shares purchased hereunder shall be delivered to the Holder no later than three (3) Business Days after the delivery to the Company of the Notice of Exercise,
surrender of this Warrant and payment of the aggregate Exercise Price as set forth above (“Warrant Share Delivery Date”). Prior to the issuance of such Warrant Shares, if the Company fails to deliver to the Holder a certificate or
certificates representing the Warrant Shares pursuant to this Section 3(a) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise. Nothing herein shall limit a Holder’s right to pursue any other
remedies available to it hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing Warrant Shares
as required pursuant to the terms hereof. 
  
 (b) If this Warrant
shall have been exercised in part, then the Company shall, at the time of delivery of the certificate or certificates representing the Warrant Shares, deliver to Holder a new Warrant evidencing the rights of Holder to purchase the unpurchased
Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant. 
  
 4. No Fractional Shares or Scrip. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant.
As to any fraction of a share which Holder would otherwise be entitled to purchase upon such exercise, the Company shall round such fraction of a share up to the nearest whole share. 
  
 5. Charges, Taxes and Expenses. Issuance of certificates for Warrant Shares shall be made without charge to the
Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such certificate, all of which taxes and expenses shall be paid by the Company, and such certificates shall be issued in the name of the Holder or in such
name or names as may be directed by the Holder; provided, however, that in the event certificates for Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be
accompanied by the Assignment Form duly executed by the Holder, and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. 
  

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 6. Closing of Books. The Company will not close its shareholder books or records in any manner
which prevents the timely exercise of this Warrant, pursuant to the terms hereof. 
  
 7. Transfer, Division and Combination. 
  
 (a) Subject to compliance with any applicable securities laws and with the provisions of Sections 1, 5 and 7(e) hereof and the provisions of Section 5(b) of that certain Securities Purchase Agreement, dated as of
even date hereof, by and between the Company and the buyers signatory thereto (the “Securities Purchase Agreement”), this Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the
principal office of the Company, together with an Assignment Form completed and duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if
required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees and in the denomination or denominations specified in the Assignment Form, and shall issue to the assignor a new Warrant
evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. A Warrant, if properly assigned, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

  
 (b) This Warrant may be divided or combined with other
Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to
compliance with Section 7(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in
accordance with such notice. 
  
 (c) The Company shall prepare,
issue and deliver at its own expense (other than transfer taxes) the new Warrant or Warrants under this Section 7. 
  
 (d) The Company agrees to maintain, at its aforesaid office, books for the registration and the registration of transfer of the Warrants. 
  
 (e) If, at the time of the surrender of this Warrant in connection with any
transfer of this Warrant, the transfer of this Warrant shall not be registered pursuant to an effective registration statement under the 1933 Act and under applicable state securities or blue sky laws, the Company may require, as a condition of
allowing such transfer: (i) that the Holder or assignee of this Warrant, as the case may be, furnish to the Company a written opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in
comparable transactions) to the effect that such transfer may be made without registration under the 1933 Act and under applicable state securities or blue sky laws; (ii) that the Holder or assignee execute and deliver to the Company an
investment representation letter in form and substance reasonably satisfactory to the Company; and (iii) that the assignee be an “accredited investor” as defined in Rule 501(a) promulgated under the 1933 Act or a qualified
institutional buyer as defined in Rule 144A(a) under the 1933 Act. 
  

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 8. No Rights as Shareholder until Exercise. This Warrant does not entitle the Holder to any voting
rights or other rights as a shareholder of the Company prior to the exercise hereof. Upon the surrender of this Warrant, the delivery of the Notice of Exercise by facsimile copy, and the payment of the aggregate Exercise Price and the payment of all
taxes required to be paid by the Holder prior to the issuance of the Warrant Shares pursuant to Section 5, if any, the Warrant Shares so purchased shall be and be deemed to be issued to such Holder as the record owner of such shares as of the
close of business on the later of the date of such surrender, delivery or payment. 
  
 9. Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this
Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and
upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

  
 10. Saturdays, Sundays, Holidays, etc. If the last or
appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day. 
  
 11. Adjustments of Exercise Price and Number of Warrant Shares. 

  
 (a) Stock Splits, etc. The number and kind of
securities purchasable upon the exercise of this Warrant and the Exercise Price shall be subject to adjustment from time to time if the Company shall: (i) pay a dividend in shares of Common Stock or make a distribution in shares of Common Stock
to holders of its outstanding Common Stock; (ii) subdivide its outstanding shares of Common Stock into a greater number of shares; (iii) combine its outstanding shares of Common Stock into a smaller number of shares of Common Stock; or
(iv) issue any shares of its capital stock in a reclassification of the Common Stock. Upon the happening of any of the events set forth in subsections (i)-(iv) of this Section 11(a), the number of Warrant Shares purchasable upon
exercise of this Warrant immediately prior thereto shall be adjusted so that the Holder shall be entitled to receive the kind and number of Warrant Shares or other securities of the Company which it would have owned or have been entitled to receive
had such Warrant been exercised in advance thereof. Upon each such adjustment of the kind and number of Warrant Shares or other securities of the Company which are purchasable hereunder, the Holder shall thereafter be entitled to purchase the number
of Warrant Shares or other securities resulting from such adjustment at an Exercise Price per Warrant Share or other security obtained by multiplying the Exercise Price in effect immediately prior to such adjustment by the number of Warrant Shares
purchasable pursuant hereto immediately prior to such adjustment and dividing by the number of Warrant Shares or other securities of the Company that are purchasable pursuant hereto immediately after such adjustment. An adjustment made pursuant to
this paragraph shall become effective immediately after the effective date of such event retroactive to the record date, if any, for such event. 
  

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 (b) Anti-Dilution Provisions. During the period commencing on the Initial Exercise Date and ending
on the date which is 180 days thereafter (the “Adjustment Period”), the Exercise Price shall be subject to adjustment from time to time as provided in this Section 11(b). In the event that any adjustment of the Exercise Price
as required herein results in a fraction of a cent, such Exercise Price shall be rounded up or down to the nearest cent. 
  
 (i) Adjustment of Exercise Price. If during the Adjustment Period, the Company issues or sells, or in accordance with this Section 11(b) is
deemed to have issued or sold, any shares of Common Stock (excluding Excluded Securities) for a consideration per share (the “New Securities Issuance Price”) less than a price (the “Applicable Price”) equal to the
Exercise Price in effect immediately prior to such time, then immediately after such issue or sale, the Exercise Price then in effect shall be reduced to an amount equal to the New Securities Issuance Price. 
  
 (ii) Effect on Exercise Price of Certain Events. For purposes of
determining the adjusted Exercise Price under Section 11(b) hereof, the following will be applicable: 
  
 (A) Issuance of Rights or Options. If the Company in any manner grants or sells any Options and the lowest price per share for which one share of
Common Stock is issuable upon the exercise of any such Option or upon conversion, exchange or exercise of any Convertible Securities issuable upon exercise of such Option is less than the Applicable Price, then such share of Common Stock shall be
deemed to be outstanding and to have been issued and sold by the Company at the time of the granting or sale of such Option for such price per share. For purposes of this Section 11(b)(ii)(A), the “lowest price per share for which one
share of Common Stock is issuable upon the exercise of any such Option or upon conversion, exchange or exercise of any Convertible Securities issuable upon exercise of such Option” shall be equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the Company with respect to any one share of Common Stock upon granting or sale of the Option, upon exercise of the Option and upon conversion, exchange or exercise of any Convertible Security
issuable upon exercise of such Option. No further adjustment of the Exercise Price shall be made upon the actual issuance of such Common Stock or of such Convertible Securities upon the exercise of such Options or upon the actual issuance of such
Common Stock upon conversion, exchange or exercise of such Convertible Securities. 
  
 (B) Issuance of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities and the lowest price per share for which one share of Common Stock is issuable upon such
conversion, exchange or exercise thereof is less than the Applicable Price, then such share of Common Stock shall be deemed to be outstanding and to have been issued and sold by the Company at the time of the issuance of sale of such Convertible
Securities for such price per share. For the purposes of this Section 11(b)(ii)(B), the “lowest price per share for which one share of Common Stock is issuable upon such conversion, exchange or exercise” shall be equal to the sum of
the lowest amounts of consideration (if any) received or receivable by the Company with respect to any one share of Common Stock upon the issuance or sale of the Convertible Security and upon the conversion, exchange or exercise of such Convertible
Security. No further adjustment of the Exercise Price shall be made upon the actual issuance of such Common Stock upon conversion, exchange or exercise of such 
  

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 Convertible Securities, and if any such issue or sale of such Convertible Securities is made upon exercise of any Options
for which adjustment of the Exercise Price had been or are to be made pursuant to other provisions of this Section 11(b)(ii), no further adjustment of the Exercise Price shall be made by reason of such issue or sale. 
  
 (C) Change in Option Price or Conversion Rate. If the purchase or
exercise price provided for in any Options, or the additional consideration, if any, payable upon the issue, conversion, exchange or exercise of any Convertible Securities, or the rate at which any Convertible Securities are convertible into or
exchangeable or exercisable for Common Stock changes at any time, the Exercise Price in effect at the time of such change shall be adjusted to the Exercise Price which would have been in effect at such time had such Options or Convertible Securities
provided for such changed purchase price, additional consideration or changed conversion rate, as the case may be, at the time initially granted, issued or sold. For purposes of this Section 11(b)(ii)(C), if the terms of any Option or
Convertible Security that was outstanding as of the Initial Exercise Date are changed in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the Common Stock deemed issuable upon exercise,
conversion or exchange thereof shall be deemed to have been issued as of the date of such change. No adjustment shall be made if such adjustment would result in an increase of the Exercise Price then in effect unless the holders of the Preferred
Shares are provided at least ten (10) Business Days’ prior notice. 
  
 (D) Calculation of Consideration Received. In case any Option is issued in connection with the issue or sale of other securities of the Company, together comprising one integrated transaction in which no
specific consideration is allocated to such Options by the parties thereto, the Options will be deemed to have been issued for a consideration of $0.01. If any Common Stock, Options or Convertible Securities are issued or sold or deemed to have been
issued or sold for cash, the consideration received therefor will be deemed to be the gross amount received by the Company therefor. If any Common Stock, Options or Convertible Securities are issued or sold for a consideration other than cash, the
amount of the consideration other than cash received by the Company will be the fair value of such consideration, except where such consideration consists of marketable securities, in which case the amount of consideration received by the Company
will be the arithmetic average of the Closing Sale Prices of such securities during the ten (10) consecutive trading days ending on the date of receipt of such securities. The fair value of any consideration other than cash or securities will
be determined jointly by the Company and the holders of at least a majority of the Warrants of like tenor of this Warrant then outstanding. 
  
 (E) Exceptions to Adjustment of Exercise Price. Notwithstanding the foregoing, no adjustment will be made under this Section 11(b) in respect
of Excluded Securities (as defined in the Certificate of Designations). 
  
 (iii) Offerings of Other Property to Common Stock Holders. If the Company, at any time prior to the Termination Date, shall distribute to all holders of Common Stock (and not to Holders of the Warrants)
evidences of its indebtedness or assets or rights or warrants to subscribe for or purchase any security other than the Common Stock (which shall be subject to Section 11(b)(i)), then in each such case the Exercise Price shall be adjusted by

  

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 multiplying the Exercise Price in effect immediately prior to the record date fixed for determination of shareholders
entitled to receive such distribution by a fraction of which the denominator shall be the Closing Price determined as of the record date mentioned above, and of which the numerator shall be such Closing Price on such record date less the then per
share fair market value at such record date of the portion of such assets or evidence of indebtedness so distributed applicable to one outstanding share of the Common Stock as determined by the Board of Directors in good faith. In either case the
adjustments shall be described in a statement provided to the Holders of the portion of assets or evidences of indebtedness so distributed or such subscription rights applicable to one share of Common Stock. Such adjustment shall be made whenever
any such distribution is made and shall become effective immediately after the record date mentioned above. 
  
 (iv) Minimum Adjustment of Exercise Price. No adjustment of the Exercise Price shall be made in an amount of less than 1% of the Exercise Price in
effect at the time such adjustment is otherwise required to be made, but any such lesser adjustment shall be carried forward and shall be made at the time and together with the next subsequent adjustment which, together with any adjustments so
carried forward, shall amount to not less than 1% of such Exercise Price. 
  
 12. Reorganization, Reclassification, Merger, Consolidation or Disposition of Assets. In case the Company shall reorganize its capital, reclassify its capital stock, consolidate or merge with or into another
corporation (where the Company is not the surviving corporation or where there is a change in or distribution with respect to the Common Stock of the Company), or sell, transfer or otherwise dispose of its property, assets or business to another
corporation and, pursuant to the terms of such reorganization, reclassification, merger, consolidation or disposition of assets, shares of common stock of the successor or acquiring corporation, or any cash, shares of stock or other securities or
property of any nature whatsoever (excluding cash but including warrants or other subscription or purchase rights) in addition to or in lieu of common stock of the successor or acquiring corporation (“Other Property”), are to be
received by or distributed to the holders of Common Stock of the Company, then the Holder shall have the right thereafter to receive the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the
surviving corporation, and Other Property receivable upon or as a result of such reorganization, reclassification, merger, consolidation or disposition of assets by a Holder of the number of shares of Common Stock for which this Warrant is
exercisable immediately prior to such event. In case of any such reorganization, reclassification, merger, consolidation or disposition of assets, the successor or acquiring corporation (if other than the Company) shall expressly assume the
due and punctual observance and performance of each and every covenant and condition of this Warrant to be performed and observed by the Company and all the obligations and liabilities hereunder, subject to such modifications as may be deemed
appropriate (as determined in good faith by resolution of the Board of Directors of the Company) in order to provide for adjustments of Warrant Shares for which this Warrant is exercisable which shall be as nearly equivalent as practicable to the
adjustments provided for in this Section 12. For purposes of this Section 12, “common stock of the successor or acquiring corporation” shall include stock of such corporation of any class which is not preferred as to dividends or
assets over any other class of stock of such corporation and which is not subject to redemption and shall also include any evidences of indebtedness, shares of stock or other 
  

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 securities which are convertible into or exchangeable for any such stock, either immediately or upon the arrival of a
specified date or the happening of a specified event and any warrants or other rights to subscribe for or purchase any such stock. The foregoing provisions of this Section 12 shall similarly apply to successive reorganizations,
reclassifications, mergers, consolidations or disposition of assets. 
  
 13. Voluntary Adjustment by the Company. The Company may at any time during the term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board of Directors of the
Company. 
  
 14. Notice of Adjustment. Whenever the number
of Warrant Shares or number or kind of securities or other property purchasable upon the exercise of this Warrant or the Exercise Price is adjusted, as herein provided, the Company shall give notice thereof to the Holder, which notice shall state
the number of Warrant Shares (and other securities or property) purchasable upon the exercise of this Warrant and the Exercise Price of such Warrant Shares (and other securities or property) after such adjustment, setting forth a brief statement of
the facts requiring such adjustment and setting forth the computation by which such adjustment was made. 
  
 15. Notice of Corporate Action. If at any time: 
  
 (a) the Company shall take a record of the holders of its Common Stock for the purpose of entitling them to receive a dividend or other distribution, or
any right to subscribe for or purchase any evidences of its indebtedness, any shares of stock of any class or any other securities or property, or to receive any other right, or 
  
 (b) there shall be any capital reorganization of the Company, any reclassification or recapitalization of the capital stock
of the Company or any consolidation or merger of the Company with, or any sale, transfer or other disposition of all or substantially all the property, assets or business of the Company to, another corporation or, 
  
 (c) there shall be a voluntary or involuntary dissolution, liquidation or
winding up of the Company; 
  
 then, in any one or more of such cases, the Company
shall give to Holder: (i) at least 20 days’ prior written notice of the date on which a record date shall be selected for such dividend, distribution or right or for determining rights to vote in respect of any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition, liquidation or winding up, and (ii) in the case of any such reorganization, reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or
winding up, at least 20 days’ prior written notice of the date when the same shall take place. Such notice in accordance with the foregoing clause also shall specify: (A) the date on which any such record is to be taken for the purpose of
such dividend, distribution or right, the date on which the holders of Common Stock shall be entitled to any such dividend, distribution or right, and the amount and character thereof, and (B) the date on which any such reorganization,
reclassification, merger, consolidation, sale, transfer, disposition, dissolution, liquidation or winding up is to take place and the time, if any such time is to be fixed, as of which the holders of Common Stock shall be entitled to exchange their
Warrant Shares for securities or other property deliverable upon such disposition, dissolution, 
  

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 liquidation or winding up. Each such written notice shall be sufficiently given if addressed to Holder at the last
address of Holder appearing on the books of the Company and delivered in accordance with Section 17(d). 
  
 16. Authorized Shares. The Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued
Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority
to its officers who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for the Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such
reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation. 
  

Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending the
Company’s Articles of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of
the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against
impairment. Without limiting the generality of the foregoing, the Company will: (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value,
(ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant, and (iii) use commercially reasonable
efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Warrant. 
  
 Before taking any action which would result in an adjustment in the number of
Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having
jurisdiction thereof. 
  
 17. Miscellaneous. 
  
 (a) Jurisdiction. All questions concerning the construction,
validity, enforcement and interpretation of this Warrant shall be determined in accordance with the provisions of the Securities Purchase Agreement. 
  
 (b) Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, will have
restrictions upon resale imposed by state and federal securities laws. 
  
 (c) Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or 
  

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 otherwise prejudice Holder’s rights, powers or remedies, notwithstanding all rights hereunder terminate on the
Termination Date. If the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to Holder such amounts as shall be sufficient to cover any costs
and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies
hereunder. 
  
 (d) Notices. Any notice, request or other
document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Securities Purchase Agreement. 
  
 (e) Limitation of Liability. No provision hereof, in the absence of any affirmative action by Holder to exercise this
Warrant or purchase Warrant Shares, and no enumeration herein of the rights or privileges of Holder, shall give rise to any liability of Holder for the purchase price of any Common Stock or as a shareholder of the Company, whether such liability is
asserted by the Company or by creditors of the Company. 
  
 (f)
Remedies. Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive the defense in any action for specific performance that a remedy at law would be adequate. 
  
 (g) Successors and Assigns. Subject to applicable securities laws,
this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for
the benefit of all Holders from time to time of this Warrant and shall be enforceable by any such Holder or holder of Warrant Shares. 
  
 (h) Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.

  
 (i) Severability. Wherever possible, each provision of
this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant. 
  
 (j) Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this
Warrant. 
  
 [Signature Page Follows] 
  

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 IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto
duly authorized. 
  
 Dated:
                    , 2005 
  

			
	I2 TELECOM INTERNATIONAL, INC.
		
	By:	 	  

	Name:	 	 
	Title:	 	 

 EXHIBIT A 
  

ASSIGNMENT FORM 
  
 (To assign the foregoing warrant, execute 
 this
form and supply required information. 
 Do not use this form to exercise the warrant.) 
  
 FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby
are hereby assigned to 
  

			
	  

	 	whose address is

			
	 .

	 	 

  

  
 Dated:
                ,          
  

					
	 	 	 Holder’s Signature:
	 	  

	 	 	 Holder’s Address:
	 	  

	 	 	 	 	  

  

			
	 Signature Guaranteed:
	 	  

  
 NOTE: The signature to this Assignment
Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank or trust company. Officers of corporations and those acting in a fiduciary or
other representative capacity should file proper evidence of authority to assign the foregoing Warrant. 

 EXHIBIT B 
  

NOTICE OF EXERCISE 
  
 To: i2 Telecom International, Inc. 
  
 (1) The undersigned hereby elects to purchase              Warrant Shares of the
Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any. 
  
 (2) Payment shall take the form of in lawful money of the United States.

  
 (3) Please issue a certificate or certificates representing
said Warrant Shares in the name of the undersigned or in such other name as is specified below: 
  
  

			
	 	 	  

  
 The
Warrant Shares shall be delivered to the following: 
  

			
	 	 	  

	 	 	  

	 	 	  

  
 (4) The undersigned is
an “accredited investor” as defined in Regulation D under the Securities Act of 1933, as amended. 
  

			
	[BUYER]
		
	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 
	
	 Dated:Form of Securities Purchase Agreement

 EXHIBIT 10.1 
  
 SECURITIES PURCHASE AGREEMENT 
  

THIS SECURITIES PURCHASE AGREEMENT (the “Agreement”), is dated as of July 12, 2005, by and among i2 Telecom International,
Inc., a Washington corporation, with headquarters located at 1200 Abernathy Road, Suite 1800, Atlanta, Georgia 30328 (the “Company”), and the investors listed on the Schedule of Buyers (the “Schedule of Buyers”)
attached hereto (individually, a “Buyer” and collectively, the “Buyers”). 
  
 WHEREAS: 
  
 A. The Company has authorized a new series of convertible preferred stock of the Company, the terms of which are set forth in the certificate of
designations for such series (the “Certificate of Designations”) substantially in the form attached hereto as Exhibit A (together with any convertible preferred shares issued in replacement thereof in accordance with the
terms thereof, the “Preferred Shares”). The Preferred Shares shall be convertible into shares of the Company’s common stock, no par value per share (the “Common Stock”) (as converted, the “Conversion
Shares”), in accordance with the terms of the Certificate of Designations. 
  
 B. Each Buyer wishes to purchase, and the Company wishes to sell, upon the terms and conditions stated in this Agreement: (i) that aggregate number of Preferred Shares set forth opposite such Buyer’s name in
column (3) on the Schedule of Buyers; and (ii) a warrant, substantially in the form attached hereto as Exhibit B (collectively, the “Warrants”), to acquire that number of shares of Common Stock set forth opposite
such Buyer’s name in column (4) on the Schedule of Buyers (as exercised, collectively, the “Warrant Shares”). 
  
 C. The Company and each Buyer is executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by
Section 4(2) of the Securities Act of 1933, as amended (the “1933 Act”), and Rule 506 of Regulation D (“Regulation D”) as promulgated by the United States Securities and Exchange Commission (the
“SEC”) under the 1933 Act to the extent necessary to issue the Preferred Shares, the Conversion Shares, the Warrants and the Warrant Shares. 
  
 D. Contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Registration Rights Agreement,
substantially in the form attached hereto as Exhibit C (the “Registration Rights Agreement”), pursuant to which the Company will agree to provide certain registration rights with respect to the Registrable Securities (as
defined in the Registration Rights Agreement) under the 1933 Act, the rules and regulations promulgated thereunder, and applicable state securities laws. 
  
 E. The Preferred Shares, the Conversion Shares, the Warrants and the Warrant Shares collectively are referred to herein as the
“Securities”. 

 NOW, THEREFORE, the Company and each Buyer hereby agree as follows: 
  
 1. PURCHASE AND SALE OF PREFERRED SHARES AND WARRANTS.

  
 (a) Preferred Shares and Warrants. Subject to
the satisfaction or waiver of the conditions set forth in Sections 6 and 7 below, the Company shall issue and sell to each Buyer, and each Buyer severally, but not jointly, agrees to purchase from the Company on the Closing Date (as hereinafter
defined), the number of Preferred Shares as is set forth opposite such Buyer’s name in column (3) on the Schedule of Buyers and the Warrant to acquire that number of Warrant Shares set forth opposite such Buyer’s name in column
(4) on the Schedule of Buyers (the “Closing”). 
  
 (b) Closing. The Closing shall occur on the Closing Date at the office of Rogers & Hardin LLP, 229 Peachtree Street, NE, 2700 International Tower, Atlanta, Georgia 30303. 
  
 (c) Purchase Price. The purchase price for each Buyer (the
“Purchase Price”) of the Preferred Shares and related Warrants to be purchased by each such Buyer at the Closing shall be equal to One Thousand Dollars ($1,000) for each Preferred Share and related Warrants being purchased by such
Buyer at the Closing. 
  
 (d) Closing Date. The date and
time of the Closing (the “Closing Date”) shall be 10:00 a.m., Atlanta Time, on the date of this Agreement, subject to notification of satisfaction or waiver of the conditions to the Closing set forth in Sections 6 and 7 below (or
such later date as is mutually agreed to by the Company and each Buyer). 
  
 (e) Form of Payment. On the Closing Date, each Buyer shall pay the Purchase Price to the Company for the Preferred Shares and Warrants to be issued and sold to such Buyer on the Closing Date by wire transfer of
immediately available funds in accordance with the Company’s written wire instructions. Also on the Closing Date, the Company shall deliver via facsimile or e-mail to each Buyer a copy of the certificates evidencing the Preferred Shares and
Warrants which such Buyer is then purchasing hereunder, duly executed on behalf of the Company and registered in the name of such Buyer or its designee. No later than two (2) Business Days (as defined in Section 4(d)) following the Closing
Date, the Company shall cause to be delivered to each Buyer the original certificates for the Preferred Shares and Warrants which such Buyer is purchasing hereunder. 
  
 2. BUYER’S REPRESENTATIONS AND WARRANTIES. Each Buyer represents and warrants with respect to only itself that:

  
 (a) No Public Sale or Distribution. Such Buyer is:
(i) acquiring the Preferred Shares and Warrants and (ii) upon conversion of the Preferred Shares and exercise of the Warrants will acquire the Conversion Shares issuable upon conversion of the Preferred Shares and the Warrant Shares
issuable upon exercise of the Warrants, for its own account and not with a view towards, or for resale in connection with, the public sale or distribution thereof, except pursuant to sales registered or exempted under the 1933 Act; provided,
however, that by making the representations herein, such Buyer does not agree to hold any of the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant
to a registration statement or an exemption under the 1933 Act. Such Buyer is acquiring the Securities hereunder in the ordinary course of its business. Such Buyer presently does not have any agreement or understanding, directly or indirectly, with
any Person (as defined in Section 3(r)) to distribute any of the Securities. 
  

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 (b) Accredited Investor Status. Such Buyer is an “accredited investor” as that term is
defined in Rule 501(a) of Regulation D. 
  
 (c) Reliance on
Exemptions. Such Buyer understands that the Securities are being offered and sold to it in reliance on specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying in
part upon the truth and accuracy of, and such Buyer’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of such Buyer set forth herein in order to determine the availability of such exemptions and
the eligibility of such Buyer to acquire the Securities. Such Buyer has not been formed solely for the purpose of acquiring the Securities. Such Buyer is not a registered broker-dealer under Section 15 of the Securities Exchange Act of 1934, as
amended (the “1934 Act”). 
  
 (d)
Information. Such Buyer and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities which have been requested
by such Buyer. Such Buyer and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigations conducted by such Buyer or its advisors, if any, or its
representatives shall modify, amend or affect such Buyer’s right to rely on the Company’s representations and warranties contained herein. 
  
 (e) No Governmental Review. Such Buyer understands that no United States federal or state agency or any other government or governmental agency has
passed on or made any recommendation or endorsement of the Securities or the fairness or suitability of the investment in the Securities nor have such authorities passed upon or endorsed the merits of the offering of the Securities. 
  
 (f) Authorization; Validity; Enforcement. This Agreement and the
Registration Rights Agreement have been duly and validly authorized, executed and delivered on behalf of such Buyer and constitute the legal, valid and binding obligations of such Buyer enforceable against such Buyer in accordance with their
respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the
enforcement of applicable creditors’ rights and remedies. 
  
 (g) Residency. Such Buyer is a resident of that country or state specified below its address on the Schedule of Buyers. 
  
 (h) Organization. If such Buyer is not an individual, then such Buyer is validly existing and in good standing under the laws of the jurisdiction
of its organization, and has the requisite power and authorization to execute and deliver this Agreement and to consummate the transaction contemplated hereby. 
  

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 3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. Except as set forth on the section of the
disclosure schedules (each a “Schedule”) attached hereto which correspond to the subsection hereunder, the Company represents and warrants to each of the Buyers that: 
  
 (a) Organization and Qualification. Except as disclosed in Schedule 3(a), the Company and its
“Subsidiaries” (which for purposes of this Agreement means any entity in which the Company, directly or indirectly, owns at least 10% of the capital stock or holds a comparable equity or similar interest) are entities duly organized
and validly existing in good standing under the laws of the jurisdiction in which they are organized, and have the requisite corporate or other power and authorization to own their properties and to carry on their business as now being conducted.
Except as disclosed in Schedule 3(a), each of the Company and its Subsidiaries is duly qualified as a foreign entity to do business and is in good standing in every jurisdiction in which its ownership of property or the nature of the
business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing could not reasonably be expected to have a Material Adverse Effect. As used in this Agreement,
“Material Adverse Effect” means any material adverse effect on the business, properties, assets, operations, results of operations or condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole, or on
the transactions contemplated hereby and the other Transaction Documents (as defined in Section 3(b)) or by the agreements and instruments to be entered into in connection herewith or therewith, or on the authority or ability of the Company to
perform its obligations under the Transaction Documents. The Company has no Subsidiaries except as disclosed in Schedule 3(a). 
  
 (b) Authorization; Enforcement; Validity. The Company has the requisite corporate power and authority to enter into and perform its obligations
under this Agreement, the Certificate of Designations, the Registration Rights Agreement, the Warrants, and each of the other agreements entered into by the parties hereto in connection with the transactions contemplated by this Agreement
(collectively, the “Transaction Documents”) and to issue the Securities in accordance with the terms hereof and thereof. The execution and delivery of the Transaction Documents by the Company and the consummation by the Company of
the transactions contemplated hereby and thereby, including, without limitation, the issuance of the Preferred Shares and the Warrants and the reservation for issuance and the issuance of the Conversion Shares and the Warrant Shares issuable upon
conversion or exercise of the Preferred Shares and the Warrants, respectively, have been duly authorized by the Company’s Board of Directors and no further consent or authorization is required by the Company, its Board of Directors or its
shareholders, except as may be disclosed in Schedule 3(b). This Agreement and the other Transaction Documents of even date herewith have been duly executed and delivered by the Company, and constitute the legal, valid and binding obligations
of the Company enforceable against the Company in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies. As of the Closing, the Transaction Documents dated after the date hereof and required to have been executed and delivered with
respect to the Closing shall have been duly executed and delivered by the Company, and shall constitute the legal, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, except as such
enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditor’s rights and
remedies. As of the Closing, the 
  

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 Certificate of Designations in the form attached as Exhibit A shall have been filed on or prior to the Closing
Date with the Secretary of State of the State of Washington and shall be in full force and effect, enforceable against the Company in accordance with its terms and shall not have been amended. 
  
 (c) Issuance of Securities. The Preferred Shares and Warrants are duly
authorized and, upon issuance in accordance with the terms hereof, shall be validly issued, free from all taxes, liens and charges with respect to the issue thereof, and the Preferred Shares shall be entitled to the rights and preferences as set
forth in the Certificate of Designations. As of the Closing, a number of shares of Common Stock shall have been duly authorized and reserved for issuance which equals 100% of the maximum number of shares of Common Stock issuable upon conversion or
exercise of the Preferred Shares and Warrants to be issued hereunder. Upon conversion or exercise in accordance with the Preferred Shares or the Warrants, as the case may be, the Conversion Shares and the Warrant Shares, respectively, will be
validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock. Assuming the accuracy of each of the
representations and warranties of Buyer contained in Section 2, the issuance by the Company of the Securities is exempt from registration under the 1933 Act. 
  
 (d) No Conflicts. Except as disclosed in Schedule 3(d), the execution, delivery and performance of the
Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Preferred Shares and Warrants and reservation for issuance and issuance
of the Conversion Shares and the Warrant Shares) will not: (i) result in a violation of the Company’s Articles of Incorporation, as amended and as in effect on the date hereof (together with any certificate of designations of rights and
preferences of any outstanding series of preferred stock of the Company, the “Articles of Incorporation”), or the Company’s Bylaws, as amended and as in effect on the date hereof (the “Bylaws”);
(ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any material agreement,
indenture or instrument to which the Company or any of its Subsidiaries is a party; or (iii) result in a violation of any law, rule, regulation, order, judgment or decree, as may be applicable to the Company or any of its Subsidiaries, or by
which any property or asset of the Company or any of its Subsidiaries is bound or affected. 
  
 (e) Consents. Except as disclosed in Schedule 3(e), all consents, authorizations, orders, filings and registrations which the Company is required as of the Closing Date to obtain to execute, deliver or
perform any of its obligations under or contemplated by the Transaction Documents in accordance with their terms have been obtained or effected on or prior to the Closing Date. The Company and its Subsidiaries are unaware of any facts or
circumstances which might reasonably be expected to prevent the Company from obtaining or effecting any of the foregoing. 
  
 (f) Acknowledgment Regarding Buyer’s Purchase of Securities. The Company acknowledges and agrees that each Buyer is acting solely in the
capacity of arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated hereby and thereby, and that no Buyer is an officer or director of the Company. The Company further acknowledges that no Buyer is
acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions 
  

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 contemplated hereby and thereby, and any advice given by a Buyer or any of its representatives or agents in connection
with the Transaction Documents and the transactions contemplated hereby and thereby is merely incidental to such Buyer’s purchase of the Securities. The Company further represents to each Buyer that the Company’s decision to enter into the
Transaction Documents has been based solely on the independent evaluation by the Company and its representatives. 
  
 (g) No General Solicitation; Placement Agent’s Fees. Neither the Company, nor any of its affiliates, nor any Person acting on its or their
behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the offer or sale of the Securities. The Company shall be responsible for the payment of any placement
agent’s fees, financial advisory fees, or brokers’ commissions (other than for persons engaged by any Buyer or its investment advisor) relating to or arising out of the transactions contemplated hereby. The Company shall pay, and hold each
Buyer harmless against, any liability, loss or expense (including, without limitation, attorney’s fees and out-of-pocket expenses) arising in connection with any such claim. 
  
 (h) No Integrated Offering. None of the Company, its Subsidiaries, any of their affiliates, and any Person acting on
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 require registration of any of the Securities under the 1933 Act or cause this offering of
the Securities to be integrated with prior offerings by the Company for purposes of the 1933 Act or any applicable shareholder approval provisions, including, without limitation, under the rules and regulations of any market, exchange or automated
quotation system on which any of the securities of the Company are listed or designated. None of the Company, its Subsidiaries, their affiliates and any Person acting on their behalf will take any action or steps referred to in the preceding
sentence that would require registration of any of the Securities under the 1933 Act or cause the offering of the Securities to be integrated with other offerings. 
  
 (i) Dilutive Effect. The Company understands and acknowledges that the number of Conversion Shares issuable upon
conversion of the Preferred Shares and the Warrant Shares issuable upon exercise of the Warrants will increase in certain circumstances. The Company further acknowledges that, subject to the terms and conditions of the Transaction Documents, its
obligation to issue Conversion Shares upon conversion of the Preferred Shares in accordance with this Agreement and the Certificate of Designations and its obligation to issue the Warrant Shares upon exercise of the Warrants in accordance with this
Agreement and the Warrants is, in each case, absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests of other shareholders of the Company. 
  
 (j) Application of Takeover Protections; Rights Agreement. The Company
and its Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover
provision under the Articles of Incorporation or the laws of the state of its incorporation which is or could become applicable to any Buyer as a result of the transactions contemplated by this Agreement, including, without limitation, the
Company’s issuance of the Securities and any Buyer’s ownership of the Securities. The Company has not adopted a shareholder rights plan or similar arrangement relating to accumulations of beneficial ownership of Common Stock or a change in
control of the Company. 
  

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 (k) SEC Documents; Financial Statements. Except as disclosed in Schedule 3(k), since
December 31, 2004, the Company has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC pursuant to the reporting requirements of the 1934 Act (all of the foregoing filed prior to the date
hereof and all exhibits included therein and financial statements and schedules thereto and documents incorporated by reference therein being hereinafter referred to as the “SEC Documents”). The Company has delivered to the Buyers
or their respective representatives true, correct and complete copies of the SEC Documents not available on the EDGAR system. Except as disclosed in Schedule 3(k), as of their respective dates, the SEC Documents complied in all material
respects with the requirements of the 1934 Act and the rules and regulations of the SEC promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue statement
of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. Except as disclosed in
Schedule 3(k), as of their respective dates, the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of
the SEC with respect thereto. Except as disclosed in Schedule 3(k), such financial statements have been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods involved (except
(i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly
present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments). No other information provided by or on behalf of the Company to the Buyers which is not included in the SEC Documents contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the
statements therein, in the light of the circumstance under which they are or were made and, taken together with the information set forth in the SEC Documents, not misleading. 
  
 (l) Absence of Certain Changes. Except as disclosed in Schedule 3(l), since December 31, 2004, there has
been no material adverse change and no material adverse development in the business, properties, operations, condition (financial or otherwise), results of operations or prospects of the Company or its Subsidiaries. Except as disclosed in
Schedule 3(l), since December 31, 2004, the Company has not: (i) declared or paid any dividends; (ii) sold any assets, individually or in the aggregate, in excess of $50,000 outside of the ordinary course of business; or
(iii) had capital expenditures, individually or in the aggregate, in excess of $500,000. The Company has not taken any steps to seek protection pursuant to any bankruptcy law nor does the Company have any knowledge or reason to believe that its
creditors intend to initiate involuntary bankruptcy proceedings or any actual knowledge of any fact which would reasonably lead a creditor to do so. 
  
 (m) No Undisclosed Events, Liabilities, Developments or Circumstances. Except as disclosed in Schedule 3(m), no event, liability,
development or circumstance has occurred or exists, or is contemplated to occur, with respect to the Company or its Subsidiaries or their respective business, properties, prospects, operations or financial condition, that would be required to be
disclosed by the Company under applicable securities laws on a registration statement on Form S-1 filed with the SEC relating to an issuance and sale by the Company of its Common Stock and which has not been publicly announced. 
  

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 (n) Conduct of Business; Regulatory Permits. Except as disclosed in Schedule 3(n), neither
the Company nor its Subsidiaries is in violation of any term of or in default under its articles of incorporation, any certificate of designations of rights and preferences of any outstanding series of preferred stock of the Company or bylaws or
their organizational charter or bylaws, respectively (except, with respect to the Subsidiaries, for violations that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect). Except as disclosed in
Schedule 3(n), neither the Company nor any of its Subsidiaries is in violation of any judgment, decree or order or any statute, ordinance, rule or regulation applicable to the Company or its Subsidiaries, and neither the Company nor any of
its Subsidiaries will conduct its business in violation of any of the foregoing, except for possible violations which could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. Except as disclosed in
Schedule 3(n), the Company and its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct their respective businesses, except where the
failure to possess such certificates, authorizations or permits could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, and neither the Company nor any such Subsidiary has received any notice of
proceedings relating to the revocation or modification of any such certificate, authorization or permit. 
  
 (o) Foreign Corrupt Practices. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other Person acting
on behalf of the Company or any of its Subsidiaries has, in the course of its actions for, or on behalf of, the Company: (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to
political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices
Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee. 
  
 (p) Transactions With Affiliates. Except as disclosed in the SEC
Documents or in Schedule 3(p), none of the officers, directors or employees of the Company is presently a party to any transaction with the Company or any of its Subsidiaries (other than for ordinary course services as employees, officers or
directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any such officer, director
or employee or, to the knowledge of the Company, any corporation, partnership, trust or other entity in which any such officer, director, or employee has a substantial interest or is an officer, director, trustee or partner. 
  
 (q) Equity Capitalization. As of the date hereof, the authorized
capital stock of the Company consists of: (i) 100,000,000 shares of Common Stock, of which as of the date hereof 37,748,977 are issued and outstanding (none of which are treasury shares), 10,000,000 shares are reserved for issuance pursuant to
the Company’s stock incentive plan and 22,757,921 shares are reserved for issuance pursuant to securities (other than the aforementioned options, the Preferred Shares and the Warrants) exercisable or exchangeable for, or convertible into,
shares of Common Stock; and (ii) 5,000,000 shares of preferred stock, (I) 100,000 shares of such preferred 
  

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 stock are designated as Preferred Stock Series A-1 with a stated value of $100.00 per share, of which as of the date
hereof no shares are issued and outstanding, (II) 100,000 shares of such preferred stock are designated as Preferred Stock Series A-2 with a stated value of $100.00 per share, of which as of the date hereof no shares are issued and outstanding,
(III) 600,000 shares of such preferred stock are designated as Preferred Stock Series B with no stated value, of which as of the date hereof no shares are issued and outstanding, (IV) 100,000 shares of such preferred stock are designated as
Preferred Stock Series C with no stated value, of which as of the date hereof no shares are issued and outstanding, (V) 10,000 shares of such preferred stock are designated as Preferred Stock Series D with a stated value of $1,000.00 per share
(the “Preferred Stock Series D”), of which as of the date hereof 4,175 shares are issued and outstanding; and (VI) 10,000 shares of such preferred stock are designated as Series E Preferred Stock with a stated value of $1,000 per
share, of which as of the date hereof no shares are issued and outstanding (except such Preferred Shares that are to be issued at the Closing). All of such outstanding shares have been, or upon issuance will be, validly issued and are fully paid and
nonassessable. Except as set forth on Schedule 3(q): (A) no shares of the Company’s capital stock are subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or permitted by the Company;
(B) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares of capital
stock of the Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of
its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares of capital stock of the
Company or any of its Subsidiaries; (C) there are no outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments evidencing Indebtedness (as defined in Section 3(r)) of the Company
or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or may become bound; (D) there are no financing statements securing obligations in any material amounts, either singly or in the aggregate, filed in connection
with the Company; (E) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities under the 1933 Act (except the Registration Rights Agreement);
(F) there are no outstanding securities or instruments of the Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or
any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries; (G) there are no securities or instruments containing anti-dilution, pre-emptive or similar provisions that will be triggered by the
issuance of the Securities; (H) the Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement; and (I) the Company and its Subsidiaries have no liabilities or
obligations required to be disclosed in the SEC Documents (as defined herein) but not so disclosed in the SEC Documents, other than those incurred in the ordinary course of the Company’s or its Subsidiaries’ respective businesses and
which, individually or in the aggregate, do not or could not reasonably be expected to have a Material Adverse Effect. The Company has furnished to the Buyer true, correct and complete copies of the Articles of Incorporation, Bylaws and the terms of
all securities convertible into, or exercisable or exchangeable for, Common Stock and the material rights of the holders thereof in respect thereto. 
  

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 (r) Indebtedness and Other Contracts. Except as disclosed in Schedule 3(r), neither
the Company nor any of its Subsidiaries: (i) has any outstanding Indebtedness; (ii) is a party to any contract, agreement or instrument, the violation of which, or default under which, by the other party(ies) to such contract, agreement or
instrument could reasonably be expected to result in a Material Adverse Effect; (iii) is in violation of any term of or in default under any contract, agreement or instrument relating to any Indebtedness, except where such violations and
defaults could not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect; or (iv) is a party to any contract, agreement or instrument relating to any Indebtedness, the performance of which, in the
judgment of the Company’s officers, has or is expected to have a Material Adverse Effect. For purposes of this Agreement: (I) “Indebtedness” of any Person means, without duplication: (A) all indebtedness for borrowed
money, (B) all obligations issued, undertaken or assumed as the deferred purchase price of property or services (other than trade payables entered into in the ordinary course of business), (C) all reimbursement or payment obligations with
respect to letters of credit, surety bonds and other similar instruments, (D) all obligations evidenced by notes, bonds, debentures or similar instruments, including obligations so evidenced incurred in connection with the acquisition of
property, assets or businesses, (E) all indebtedness created or arising under any conditional sale or other title retention agreement, or incurred as financing, in either case with respect to any property or assets acquired with the proceeds of
such indebtedness (even though the rights and remedies of the seller or bank under such agreement in the event of default are limited to repossession or sale of such property), (F) all monetary obligations under any leasing or similar
arrangement which, in connection with generally accepted accounting principles, consistently applied for the periods covered thereby, is classified as a capital lease, (G) all indebtedness referred to in clauses (A) through (F) above
secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any mortgage, lien, pledge, charge, security interest or other encumbrance (each, a “Lien”) upon or in any
property or assets (including accounts and contract rights) owned by any Person, even though the Person which owns such assets or property has not assumed or become liable for the payment of such indebtedness, and (H) all Contingent Obligations
in respect of indebtedness or obligations of others of the kinds referred to in clauses (A) through (G) above; (II) “Contingent Obligation” means, as to any Person, any direct or indirect liability, contingent or
otherwise, of that Person with respect to any indebtedness, lease, dividend or other obligation of another Person if the primary purpose or intent of the Person incurring such liability, or the primary effect thereof, is to provide assurance to the
obligee of such liability that such liability will be paid or discharged, or that any agreements relating thereto will be complied with, or that the holders of such liability will be protected (in whole or in part) against loss with respect thereto;
and (III) “Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated organization and a government or any department or agency thereof. 
  
 (s) Absence of Litigation. There is no action, suit, proceeding,
inquiry or investigation, whether criminal, civil or otherwise, before any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company, threatened against or affecting the Company, the
Common Stock or any of the Company’s Subsidiaries or any of the Company’s or the Company’s Subsidiaries’ officers or directors in their capacities as such, except: (i) as disclosed in the Company’s Annual Report on Form
10-KSB for the year ended December 31, 2004, if, as may be amended, or in the Company’s Quarterly Report on Form 10-QSB for the quarter ended March 31, 2005, as may be amended, or (ii) such as are not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect. 
  

 10 

 (t) Insurance. The Company and each of its Subsidiaries are insured by insurers of recognized
financial responsibility against such losses and risks and in such amounts as management of the Company believes to be prudent and customary in the businesses in which the Company and its Subsidiaries are engaged. Except as disclosed in Schedule
3(t), neither the Company nor any such Subsidiary has been refused any insurance coverage sought or applied for and neither the Company nor any such Subsidiary has any reason to believe that it will not be able to renew its existing insurance
coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business at a cost that could not have a Material Adverse Effect. 
  
 (u) Employee Relations. Neither the Company nor any of its
Subsidiaries is a party to any collective bargaining agreement or employs any member of a union. The Company and its Subsidiaries believe that their relations with their employees are good. No executive officer of the Company (as defined in Rule
501(f) of the 1933 Act) has notified the Company that such officer intends to leave the Company or otherwise terminate such officer’s employment with the Company. No executive officer of the Company, to the knowledge of the Company, is, or is
now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement, non-competition agreement, or any other contract or agreement or any restrictive covenant, and, to
the knowledge of the Company, the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any material liability with respect to any of the foregoing matters. The Company and its Subsidiaries
are in compliance with all federal, state, local and foreign laws and regulations respecting employment and employment practices, terms and conditions of employment and wages and hours, except where failure to be in compliance could not, either
individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect. 
  
 (v) Title. The Company and its Subsidiaries have good and marketable title to all personal property owned by them which is material to the business
of the Company and its Subsidiaries, in each case free and clear of all Liens, encumbrances and defects except: (i) immaterial Liens for taxes not yet delinquent; (ii) immaterial mechanics’ and materialmen’s Liens (and other
similar Liens), and immaterial liens under operating and similar agreements, to the extent the same relate to expenses incurred in the ordinary course of business and that are not yet due; (iii) that are routine governmental approvals; or
(iv) such as do not materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company and any of its Subsidiaries. Neither the Company nor any of its Subsidiaries owns
any real property. Any real property and facilities held under lease by the Company and any of its Subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the
use made and proposed to be made of such property and buildings by the Company and its Subsidiaries. 
  
 (w) Intellectual Property Rights. The Company and its Subsidiaries own or possess adequate rights or licenses to use all trademarks, trade names,
service marks, service mark registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals, governmental authorizations, trade secrets and other intellectual property rights (“Intellectual Property
Rights”) necessary to conduct their respective businesses as now 
  

 11 

 conducted. Except as disclosed in Schedule 3(w), none of the Company’s Intellectual Property Rights have
expired or terminated, or are expected to expire or terminate within two (2) years from the date of this Agreement, except for those which could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
The Company does not have any knowledge of any infringement by the Company or its Subsidiaries of Intellectual Property Rights of others. Except as disclosed in Schedule 3(w), there is no claim, action or proceeding being made or brought, or
to the knowledge of the Company, being threatened, against the Company or its Subsidiaries regarding its Intellectual Property Rights. The Company does not have any knowledge of any facts or circumstances which might give rise to any of the
foregoing infringements or claims, actions or proceedings. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties. 
  
 (x) Environmental Laws. The Company and its Subsidiaries: (i) are
in compliance with any and all Environmental Laws (as hereinafter defined); (ii) have received all permits, licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and
(iii) are in compliance with all terms and conditions of any such permit, license or approval where, in each of the foregoing clauses (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in
the aggregate, a Material Adverse Effect. The term “Environmental Laws” means all federal, state, local or foreign laws relating to pollution or protection of human health or the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata), including, without limitation, laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or
wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all
authorizations, codes, decrees, demands or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations issued, entered, promulgated or approved thereunder. 
  
 (y) Subsidiary Rights. The Company or one of its Subsidiaries has the
unrestricted right to vote, and (subject to limitations imposed by applicable law) to receive dividends and distributions on, all capital securities of its material Subsidiaries as owned by the Company or such Subsidiary. 
  
 (z) Tax Status. Except as disclosed in Schedule 3(z), the
Company and each of its Subsidiaries: (i) has made or filed all federal and state income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject; (ii) has paid all taxes and other
governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations, except those being contested in good faith; and (iii) has set aside on its books provision reasonably
adequate for the payment of all taxes for periods subsequent to the periods to which such returns, reports or declarations apply. Except as disclosed in Schedule 3(z), there are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the officers of the Company know of no basis for any such claim. 
  
 (aa) Internal Accounting Controls. The Company and each of its Subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific 
  

 12 

 authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain asset and liability accountability; (iii) access to assets or incurrence of liabilities is permitted only in accordance with management’s general or specific
authorization; and (iv) the recorded accountability for assets and liabilities is compared with the existing assets and liabilities at reasonable intervals and appropriate action is taken with respect to any difference. The Company maintains
disclosure controls and procedures (as such term is defined in Rule 13a-14 under the 1934 Act) that are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is
recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the SEC, including, without limitation, controls and procedures designed in to ensure that information required to be disclosed by the Company
in the reports that it files or submits under the 1934 Act is accumulated and communicated to the Company’s management, including its principal executive officer or officers and its principal financial officer or officers, as appropriate, to
allow timely decisions regarding required disclosure. 
  
 (bb)
Sarbanes-Oxley Act. The Company is in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the SEC
thereunder that are effective as of the date hereof, except where such noncompliance could not have a Material Adverse Effect. 
  
 (cc) Investment Company Status. The Company is not, and upon consummation of the sale of the Securities will not be, an “investment
company,” a company controlled by an “investment company” or an “affiliated person” of, or “promoter” or “principal underwriter” for, an “investment company” as such terms are defined in the
Investment Company Act of 1940, as amended. 
  
 4.
COVENANTS. 
  
 (a) Best Efforts. Each party shall
use its best efforts timely to satisfy each of the conditions to be satisfied by it as provided in Sections 6 and 7 of this Agreement. 
  
 (b) Form D and Blue Sky. The Company agrees to file a Form D with respect to the Securities as required under Regulation D and to provide a copy
thereof to each Buyer promptly after such filing. The Company shall, on or before the Closing, take such action as the Company shall reasonably determine is necessary to take on or prior to the Closing in order to obtain an exemption for or to
qualify the Securities for sale to the Buyers at the Closing pursuant to this Agreement under applicable securities or “Blue Sky” laws of the states of the United States (or to obtain an exemption from such qualification), and shall
provide evidence of any such action so taken to the Buyers on or prior to the Closing Date. The Company shall make all filings and reports relating to the offer and sale of the Securities required under applicable securities or “Blue Sky”
laws of the states of the United States following the Closing Date. 
  
 (c) Reporting Status. Until the date on which the Buyers shall have sold all the Conversion Shares and Warrant Shares and none of the Preferred Shares or Warrants is outstanding (the “Reporting Period”), the Company
shall file all reports required to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder
would otherwise permit such termination. 
  

 13 

 (d) Financial Information. The Company agrees to send the following to each Buyer during the
Reporting Period: (i) unless the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a copy of its Annual Reports on
Form 10-KSB, its Quarterly Reports on Form 10-QSB, any Current Reports on Form 8-K and any registration statements (other than on Form S-8) or amendments filed pursuant to the 1933 Act; and (ii) copies of any notices and other information made
available or given to the shareholders of the Company generally, contemporaneously with the making available or giving thereof to the shareholders. As used herein, “Business Day” means any day other than Saturday, Sunday or other
day on which commercial banks in Atlanta, Georgia are authorized or required by law to remain closed. 
  
 (e) Fees. Except as otherwise set forth in this Agreement or in the Registration Rights Agreement, each party to this Agreement shall bear its own
expenses in connection with the sale of the Securities to the Buyers. 
  
 (f) Disclosure of Transactions and Other Material Information. On or before the fourth Business Day following the Closing, the Company shall file a Current Report on Form 8-K describing the material terms of the transactions
contemplated hereby (the “8-K Filing”). From and after the filing of the 8-K Filing, no Buyer shall be in possession of any material, nonpublic information received from the Company, any of its Subsidiaries or any of its respective
officers, directors, employees or agents, that is not disclosed in the 8-K Filing. The Company shall not, and shall cause each of its Subsidiaries and its and each of their respective officers, directors, employees and agents, not to, provide any
Buyer with any material nonpublic information regarding the Company or any of its Subsidiaries from and after the filing of the 8-K. No Buyer shall issue any press releases or any other public statements with respect to the transactions contemplated
hereby. 
  
 (g) Restriction on Redemption and Cash
Dividends. So long as any Preferred Shares are outstanding, the Company shall not, directly or indirectly, redeem, or declare or pay any cash dividend or distribution on, the Common Stock without the prior express written consent of the holders
of at least a majority of the Preferred Shares. 
  
 (h)
Additional Securities. For so long as any Buyer beneficially owns any Securities, the Company will not issue any Preferred Shares other than to the Buyers as contemplated hereby. 
  
 (i) Reservation of Shares. The Company shall take all action necessary to at all times have authorized, and reserved
for the purpose of issuance, no less than 100% of the sum of: (i) the number of shares of Common Stock issuable upon conversion of the Preferred Shares issued at the Closing and (ii) the number of shares of Common Stock issuable upon
exercise of the Warrants issued at the Closing. 
  
 (j) Conduct
of Business. The business of the Company and its Subsidiaries shall not be conducted in violation of any law, ordinance or regulation of any governmental entity, except where such violations could not reasonably be expected to result, either
individually or in the aggregate, in a Material Adverse Effect. 
  

 14 

 (k) No Short Sales. So long as any Buyer owns any Preferred Shares, such Buyer shall not engage in
short sales of the Common Stock. 
  
 (l) Right of
Participation. 
  
 (i) Subject to the terms and conditions
specified in this Section 4(l), the Company hereby grants to the Buyers a right to purchase in each Subsequent Placement (as hereinafter defined) the Offered Securities (as hereinafter defined), with each Buyer having the right to purchase its
Pro Rata Share (as herein after defined) of such securities. Such right shall expire and terminate upon the earlier of: (A) the date which is 180 days after the Closing Date; (B) the date on which the next Subsequent Placement is
completed, if such placement provides aggregate gross proceeds to the Company of at least Ten Million Dollars ($10,000,000); and (C) the date on which the aggregate purchase price of all Offered Securities offered to the Buyers pursuant to this
Section 4(l) exceeds Four Million Dollars ($4,000,000). The Company shall make offerings of the Offered Securities to the Buyers in accordance with the provisions of this Section 4(l). 
  
 (ii) As used herein: (A) “Offered Securities” means
(I) with respect to a Subsequent Placement with aggregate gross proceeds to the Company of less than Ten Million Dollars ($10,000,000), the Company’s securities offered in such placement with a value (as determined based on the purchase
price of such securities in such placement) of $10,000,000, and (II) with respect to a Subsequent Placement with aggregate gross proceeds to the Company of at least Ten Million Dollars ($10,000,000), the Company’s securities offered in such
placement with a value (as determined based on the purchase price of such securities in such placement) equal to forty percent (40%) of such net proceeds; (B) ”Subsequent Placement” means the issuance or sale by the
Company of any shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock; and (C) ”Pro Rata Share” means, with respect to any Buyer, the ratio determined by dividing (I) the
Purchase Price paid by such Buyer hereunder by (II) the aggregate Purchase Price paid by all the Buyers hereunder. 
  
 (iii) In connection with each Subsequent Placement, the Company shall deliver a written notice (an “Offering Notice”) to each Buyer
stating: (A) the Company’s bona fide intention to offer the Offered Securities, (B) the number of such Offered Securities to be offered to such Buyer, and (C) the price and a summary of the terms upon which the Company proposes
to offer such Offered Securities. 
  
 (iv) By written
notification received by the Company within fifteen (15) calendar days after delivery of the Offering Notice by the Company (such period being the “Offer Period”), each Buyer may elect to purchase, at the price and on the terms
specified in the Offering Notice, all or any portion of such Buyer’s Pro Rata Share of the Offered Securities (the “Acceptance Notice”). 
  

(v) If any of the Offered Securities that a Buyer is entitled to purchase pursuant to this Section 4(l) is not elected to be purchased by such
Buyer as provided in this Section 4(l) (the “Refused Securities”), then the Company may, during the sixty (60)-day period following the expiration of the Offer Period, offer the Refused Securities to any Person or 

 

 15 

 Persons at a price not less than, and upon terms no more favorable to the offeree than, those specified in the Offering
Notice. If the Company does not enter into an agreement for the sale of the Offered Securities within such sixty (60)-day period, or if such agreement is not consummated within thirty (30) days after the execution thereof, the right provided
hereunder shall be deemed to be revived and such Refused Securities shall not be offered or sold unless first reoffered to Buyers in accordance herewith. 
  
 (vi) Upon each closing of the purchase and sale of Offered Securities, the Buyers shall purchase from the Company, and the Company shall sell to the
Buyers, the number of Offered Securities specified in the Acceptance Notices upon the terms and conditions specified in the Offering Notice. The purchase by the Buyers of any Offered Securities is subject in all cases to the preparation, execution
and delivery by the Company and such Buyers of a purchase agreement relating to such Offered Securities on the same terms and conditions applicable to other Persons purchasing the Offered Securities. 
  
 (vii) The right of participation in this Section 4(l) shall not be
applicable to: (A) securities issued or issuable in or after a firm commitment underwritten public offering in connection with which all outstanding Preferred Shares will be converted to Common Stock; (B) securities issued or issuable in
connection with any employee benefit plan which has been approved by the Company’s Board of Directors, pursuant to which the Company’s securities may be issued to any employee, officer, consultant or director for services provided to the
Company, including, but not limited to, the Company’s 2004 Stock Incentive Plan; (C) securities issued or issuable upon exercise, conversion or exchange of Options (as defined in the Certificate of Designations) or Convertible Securities
(as defined in the Certificate of Designations) which are outstanding on the date immediately preceding the date hereof; (D) shares of Common Stock issued or issuable upon conversion of the Preferred Shares; (E) Warrant Shares issued or
issuable upon exercise of the Warrants; (F) shares of Common Stock (including the shares of Common stock issuable in lieu of the Company’s preferred stock series A-1 and preferred stock series A-2) which the Company may become obligated to
issue in connection with that certain Agreement and Plan of Merger, dated as of January 30, 2004, among the Company, i2 Telecom International, Inc., a Delaware corporation (“i2 Delaware”), DDN Acquisition Corp. and certain
shareholders of the Company and i2 Delaware signatory thereto; (G) securities issued or issuable in connection with any strategic transactions, acquisitions or other business combinations of or by the Company that are approved by the
Company’s Board of Directors, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise; and (H) Preferred Shares issued pursuant to this Agreement. 
  
 5. REGISTER; LEGENDS. 
  
 (a) Register. The Company shall maintain at its principal executive
offices (or such other office or agency of the Company as it may designate by notice to each holder of Preferred Shares or Warrants) a register for the Preferred Shares and the Warrants, in which the Company shall record the name and address of the
Person in whose name the Preferred Shares and the Warrants have been issued (including the name and address of each transferee), the face amount of Preferred Shares held by such Person and the number of Warrant Shares issuable upon exercise of the
Warrants held by such Person. The Company shall keep the register open and available at all times during business hours for inspection of any Buyer or its legal representatives. 
  

 16 

 (b) Legends. 
  
 (i) The Securities may only be disposed of in compliance with state and federal securities laws. In connection with any
transfer of Securities other than pursuant to an effective registration statement, Rule 144 of the 1933 Act (“Rule 144”) or to the Company or an affiliate of the Buyer, the Company may require the transferor thereof to provide to
the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require
registration of such transferred Securities under the 1933 Act. As a condition of transfer other than pursuant to an effective registration statement or Rule 144, any such transferee shall agree in writing to be bound by the terms of this Agreement
and the Registration Rights Agreement and shall have the rights of a Buyer under this Agreement and the Registration Rights Agreement. 
  
 (ii) Each Buyer agrees to the imprinting, so long as is required by this Section 5(b), of the following legend on any certificate evidencing
Securities: 
  
 [NEITHER] THESE SECURITIES [NOR THE SECURITIES
INTO WHICH THESE SECURITIES ARE [EXERCISABLE] [CONVERTIBLE]] HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR REASONABLY ACCEPTABLE TO THE COMPANY TO SUCH EFFECT, THE SUBSTANCE OF WHICH
SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. 
  
 (iii)
Certificates evidencing the Securities shall not contain any legend (including the restrictive legend set forth in Section 5(b)(ii) hereof): (i) following any sale of such Security pursuant to Rule 144, (ii) if such Security is
eligible for sale under Rule 144(k), or (iii) if such restrictive legend is not required under applicable requirements of the 1933 Act (including judicial interpretations and pronouncements issued by the staff of the SEC). If all or any portion
of a Preferred Share or Warrant is converted or exercised (as applicable) at a time when such Securities may be sold under Rule 144(k) or if such restrictive legend is not otherwise required under applicable requirements of the 1933 Act (including
judicial interpretations thereof), then the Conversion Shares and Warrant Shares issuable upon conversion of such Preferred Share or upon exercise of such Warrant shall be issued free of all restrictive legends. The Company agrees that at such time
as such legend is no longer required under this Section 5(b)(iii), it will, no later than five (5) Business Days following the delivery by a Buyer to the Company or the Company’s transfer agent of a certificate representing Securities
subject to such 
  

 17 

 registration (or the applicable overlying Security), as applicable, issued with a restrictive legend, deliver or cause to
be delivered to such Buyer a certificate representing such shares that is free from all restrictive legends. The Company may not make any notation on its records or give instructions to any transfer agent of the Company that enlarge the restrictions
on transfer set forth in this Section, except as may otherwise be consistent with the terms of the Registration Rights Agreement. 
  
 (iv) Notwithstanding anything to the contrary contained herein, each Buyer, severally and not jointly with the other Buyers, covenants with the Company
that such Buyer’s trading and distribution activities with respect to the Securities will be in compliance with Regulation M promulgated under the 1933 Act. Additionally, each Buyer understands and acknowledges, severally and not jointly with
the other Buyers, that the SEC currently takes the position that coverage of short sales of Securities “against the box” prior to the effective date of a registration statement with such Securities included for registration thereon is a
violation of Section 5 of the 1933 Act, as set forth in Item 65, Section 5 under Section A, of the Manual of Publicly Available Telephone Interpretations, dated July 1997, compiled by the Office of Chief Counsel, Division of
Corporation Finance. Accordingly, each Buyer, severally and not jointly with the other Buyers, hereby agrees not to use any of the Securities to cover any short sales made prior to such effective date. Each Buyer, severally and not jointly with the
other Buyers, agrees that the removal of the restrictive legend from certificates representing Securities as set forth in this Section 5(b) is predicated upon the Company’s reliance that the Buyer will sell any Securities pursuant to
either the registration requirements of the 1933 Act, including any applicable prospectus delivery requirements, or an exemption therefrom. 
  
 6. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL. The obligation of the Company hereunder to issue and sell the Preferred Shares and Warrants
to each Buyer at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for the Company’s sole benefit and may be waived by the Company at any time in
its sole discretion by providing each Buyer with prior written notice thereof: 
  
 (a) On or prior to the Closing Date, such Buyer and each other Buyer shall have executed each of the Transaction Documents to which it is a party and delivered the same to the Company. 
  
 (b) On or prior to the Closing Date, such Buyer and each other Buyer shall
have delivered to the Company the Purchase Price for the Preferred Shares and the Warrants being purchased by such Buyer and each other Buyer on the Closing Date in accordance with Section 1(c). 
  
 (c) On the Closing Date, the representations and warranties of such Buyer
shall be true and correct as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date), and such Buyer shall have performed, satisfied and complied in
all material respects (except for covenants, agreements and conditions that are qualified by materiality, which shall be complied with in all respects) with the covenants, agreements and conditions required by this Agreement to be performed,
satisfied or complied with by such Buyer at or prior to the Closing Date. 
  

 18 

 (d) On or prior to the Closing Date, the Company shall have obtained from the holders of two-thirds
(2/3) of the shares of the Series D Preferred Stock outstanding as of the Closing Date a consent, in form and substance reasonably acceptable to the Company, whereby each such holder agrees to the transactions contemplated by this Agreement and
the other Transaction Documents, including, but not limited to, the issuance of the Preferred Shares. 
  
 7. CONDITIONS TO EACH BUYER’S OBLIGATION TO PURCHASE. The obligation of the Buyer hereunder to purchase the Preferred Shares and the Warrants
at the Closing is subject to the satisfaction, at or before the Closing Date, of each of the following conditions, provided that these conditions are for each Buyer’s sole benefit and may be waived by such Buyer at any time in its sole
discretion by providing the Company with prior written notice thereof: 
  
 (a) On or prior to the Closing Date, the Company shall have executed and delivered to such Buyer each of the Transaction Documents. 
  
 (b) On or prior to the Closing Date, the Company shall have executed and delivered to such Buyer copies of the certificates for the Preferred Shares (in
such denominations as such Buyer shall request) and the Warrants (in such amounts as such Buyer shall request) being purchased by such Buyer at the Closing pursuant to this Agreement. 
  
 (c) On or prior to the Closing Date, the Company shall have delivered to such Buyer a certificate evidencing the
incorporation and good standing of the Company in the State of Washington issued by the Secretary of State of Washington as of a date within fifteen (15) Business Days of the Closing Date. 
  
 (d) On or prior to the Closing Date, the Company shall have delivered to such
Buyer a certified copy of the Articles of Incorporation as certified by the Secretary of State of the State of Washington within fifteen (15) Business Days of the Closing Date. 
  
 (e) On or prior to the Closing Date, the Company shall have delivered to such Buyer a certificate executed by the Secretary
of the Company and dated as of the Closing Date, in a form reasonably acceptable to such Buyer, setting forth: (i) the resolutions consistent with Section 3(b) as adopted by the Company’s Board of Directors and (ii) the Articles
of Incorporation and the Bylaws, each as in effect at the Closing. 
  
 (f) On the Closing Date, the representations and warranties of the Company shall be true and correct as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of
a specific date), and the Company shall have performed, satisfied and complied in all material respects (except for covenants, agreements and conditions that are qualified by materiality, which shall be complied with in all respects) with the
covenants, agreements and conditions required by the Transaction Documents to be performed, satisfied or complied with by the Company at or prior to the Closing Date. Such Buyer shall have received a certificate, executed by the Chief Executive
Officer of the Company, dated as of the Closing Date, to the foregoing. 
  
 (g) On or prior to the Closing Date, the Company shall have obtained all governmental, regulatory or third party consents and approvals, if any, necessary for the sale of the Securities. 
  

 19 

 (h) On or prior to the Closing Date, the Company shall have delivered to such Buyer such other documents
relating to the transactions contemplated by this Agreement as such Buyer may reasonably request. 
  
 (i) On or prior to the Closing Date, the Company shall have obtained from the holders of two-thirds (2/3) of the shares of the Preferred Stock Series
D outstanding as of the Closing Date, a consent, in form and substance reasonably acceptable to the Company, whereby each such holder agrees to the transactions contemplated by this Agreement and the other Transaction Documents, including, but not
limited to, the issuance of the Preferred Shares. 
  
 8.
TERMINATION. In the event that the Closing shall not have occurred with respect to a Buyer on or before five (5) Business Days from the date hereof due to the Company’s or such Buyer’s failure to satisfy the conditions set
forth in Sections 6 and 7 above (and the nonbreaching party’s failure to waive such unsatisfied condition(s)), the nonbreaching party shall have the option to terminate this Agreement with respect to such breaching party at the close of
business on such date without liability of any party to any other party. 
  
 9. MISCELLANEOUS. 
  
 (a)
Governing Law; Jurisdiction; Jury Trial. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of Georgia, without giving effect to any choice
of law or conflict of law provision or rule (whether of the State of Georgia or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of Georgia. Each party hereby irrevocably submits to the
exclusive jurisdiction of the state and federal courts sitting in Atlanta, Georgia, for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such
suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such
notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner
permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.  
  
 (b) Counterparts. This
Agreement may be executed in two or more identical counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party; provided that
a facsimile signature shall be considered due execution and shall be binding upon the signatory thereto with the same force and effect as if the signature were an original, not a facsimile signature. 
  
 (c) Headings. The headings of this Agreement are for convenience of
reference and shall not form part of, or affect the interpretation of, this Agreement. 
  

 20 

 (d) Severability. If any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of any provision of this Agreement in any other jurisdiction.

  
 (e) Entire Agreement; Amendments. This Agreement
supersedes all other prior oral or written agreements between the Buyers, the Company, their affiliates and Persons acting on their behalf with respect to the matters discussed herein, and this Agreement and the instruments referenced herein contain
the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor any Buyer makes any representation, warranty, covenant or undertaking
with respect to such matters. No provision of this Agreement may be amended other than by an instrument in writing signed by the Company and the holders of at least a majority of the Preferred Shares or, if prior to the Closing Date, the Company and
the Buyers listed on the Schedule of Buyers as being obligated to purchase at least a majority of the Preferred Shares. No provision hereof may be waived other than by an instrument in writing signed by the party against whom enforcement is sought.
No such amendment shall be effective to the extent that it applies to less than all of the holders of the Preferred Shares then outstanding. The Company has not, directly or indirectly, made any agreements with any Buyers relating to the terms or
conditions of the transactions contemplated by the Transaction Documents except as set forth in the Transaction Documents. 
  
 (f) Notices. Any notices, consents, waivers or other communications required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by facsimile (provided confirmation of transmission is mechanically or electronically generated and kept on file
by the sending party); or (iii) one (1) Business Day after deposit with an overnight courier service, in each case properly addressed to the party to receive the same. The addresses and facsimile numbers for such communications shall be:

  

					
	 	 	If to the Company:
		
	 	 	i2 Telecom International, Inc.
	 	 	1200 Abernathy Road, Suite 1800
	 	 	Atlanta, Georgia 30328
	 	 	Telephone:	  	(770) 512-7174
	 	 	Facsimile:	  	(770) 512-7199
	 	 	Attention:	  	Paul R. Arena

  

					
	 	 	with a copy to:
		
	 	 	Rogers & Hardin LLP
	 	 	2700 International Tower
	 	 	229 Peachtree Street, NE
	 	 	Atlanta, Georgia 30303
	 	 	Telephone:	  	(404) 522-4700
	 	 	Facsimile:	  	(404) 525-2224
	 	 	Attention:	  	Robert C. Hussle

  

 21 

 If to a Buyer, to its address or facsimile number set forth on the Schedule of Buyers, with copies to such Buyer’s
representatives as set forth on the Schedule of Buyers, or to such other address and/or facsimile number and/or to the attention of such other Person as the recipient party has specified by written notice given to each other party five (5) days
prior to the effectiveness of such change. Written confirmation of receipt (I) given by the recipient of such notice, consent, waiver or other communication, (II) mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, recipient facsimile number and an image of the first page of such transmission or (III) provided by an overnight courier service shall be rebuttable evidence of personal service, receipt by facsimile or receipt from an
overnight courier service in accordance with clause (I), (II) or (III) above, respectively. 
  
 (g) Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns, including any purchasers of the Preferred Shares or the
Warrants. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the holders of at least a majority of the Preferred Shares then outstanding, including by merger or consolidation,
except pursuant to a change of control of the Company. A Buyer may assign some or all of its rights hereunder without the consent of the Company, in which event such assignee shall be deemed to be a Buyer hereunder with respect to such assigned
rights. 
  
 (h) No Third Party Beneficiaries. This
Agreement is intended for the benefit of the parties hereto and their respective permitted successors and assigns, and is not for the benefit of, nor may any provision hereof be enforced by, any other Person. 
  
 (i) Survival. Unless this Agreement is terminated under
Section 8, the representations and warranties of the Company and the Buyers contained in Sections 2 and 3, the agreements and covenants set forth in Sections 4, 5 and 9 shall survive the Closing. Each Buyer shall be responsible only for its own
representations, warranties, agreements and covenants hereunder. 
  
 (j) Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the
other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 
  
 (k) Indemnification. In consideration of each Buyer’s execution and delivery of the Transaction Documents and
acquiring the Securities thereunder and in addition to all of the Company’s other obligations under the Transaction Documents, the Company shall defend, protect, indemnify and hold harmless each Buyer and each other holder of the Securities and
all of their shareholders, partners, members, officers, directors, employees and direct or indirect investors and any of the foregoing Persons’ agents or other representatives (including, without limitation, those retained in connection with
the transactions contemplated by this Agreement) (collectively, the “Indemnitees”) from and against any and all actions, causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in
connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and including reasonable attorneys’ fees and disbursements (the “Indemnified
Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to: (i) any misrepresentation or breach of any representation or 
  

 22 

 warranty made by the Company in the Transaction Documents; (ii) any breach of any covenant, agreement or obligation
of the Company contained in the Transaction Documents; or (iii) any cause of action, suit or claim brought or made against such Indemnitee by a third party (including for these purposes a derivative action brought on behalf of the Company) and
arising out of or resulting from (I) the execution, delivery, performance or enforcement of the Transaction Documents, (II) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of the
issuance of the Securities, (III) any disclosure made by such Buyer pursuant to Section 4(h), or (iv) the status of such Buyer or holder of the Securities as an investor in the Company (other than in connection with any action such Buyer
may have taken). To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the Company shall make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law. Except as otherwise set forth herein, the mechanics and procedures with respect to the rights and obligations under this Section 9(k) shall be the same as those set forth in Section 5 of the Registration
Rights Agreement. 
  
 (l) No Strict Construction. The
language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rules of strict construction will be applied against any party. 
  
 (m) Remedies. Each Buyer and each holder of the Securities shall have
all rights and remedies set forth in the Transaction Documents and all rights and remedies which such holders have been granted at any time under any other agreement or contract and all of the rights which such holders have under any law. Any Person
having any rights under any provision of this Agreement shall be entitled to enforce such rights specifically (without posting a bond or other security), to recover damages by reason of any breach of any provision of this Agreement and to exercise
all other rights granted by law. Furthermore, the Company recognizes that in the event that it fails to perform, observe, or discharge any or all of its obligations under this Agreement, any remedy at law may prove to be inadequate relief to the
Buyers. The Company therefore agrees that the Buyers shall be entitled to seek temporary and permanent injunctive relief in any such case without the necessity of proving actual damages and without posting a bond or other security. 
  
 (n) Independent Nature of Buyers’ Obligations and Rights. The
obligations of each Buyer under any Transaction Document are several and not joint with the obligations of any other Buyer, and no Buyer shall be responsible in any way for the performance of the obligations of any other Buyer under any Transaction
Document. Nothing contained herein or in any other Transaction Document, and no action taken by any Buyer pursuant hereto or thereto, shall be deemed to constitute the Buyers as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Buyers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Buyer confirms that it has independently participated
in the negotiation of the transaction contemplated hereby with the advice of its own counsel and advisors. Each Buyer shall be entitled to independently protect and enforce its rights, including, without limitations, the rights arising out of this
Agreement or out of any other Transaction Documents, and it shall not be necessary for any other Buyer to be joined as an additional party in any proceeding for such purpose. 
  
 [Signature Pages Follow] 
  

 23 

 IN WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this
Securities Purchase Agreement to be duly executed as of the date first written above. 
  

			
	COMPANY:
	
	i2 TELECOM INTERNATIONAL, INC. 
		
	By:	 	  

	Name:	 	 
	Title:	 	 

  
 [Signature Page
to Securities Purchase Agreement] 

 IN WITNESS WHEREOF, each Buyer and the Company have caused their respective signature page to this
Securities Purchase Agreement to be duly executed as of the date first written above. 
  

			
	Name of Investing Entity:
                                        
                                        
                                        
                                	 	 
	Signature of Authorized Signatory of Investing Entity:
                                        
                                        
                           	 	 
	Name of Authorized Signatory:
                                        
                                        
                                        
                      	 	 
	Title of Authorized Signatory:
                                        
                                        
                                        
                        	 	 
	Email Address of Authorized Entity:
                                        
                                        
                                        
              	 	 

  
 Address for Notice of Investing Entity: 
  
 Address for Delivery of Securities for Investing Entity (if not same as above): 
  
 Purchase Price paid at Closing: 
 Number of Preferred Shares: 
 Number of Warrant Shares: 
 EIN Number: [PROVIDE THIS UNDER SEPARATE COVER] 
  
 [SIGNATURE PAGES CONTINUE 
  
 [Signature Page to Securities Purchase Agreement] 

 SCHEDULE OF BUYERS 
  

									
	        (1)           
 Buyer Name    

	  	 (2)
 Address,
 Facsimile Number
 and
 E-mail Address

	  	 (3)
Aggregate Number
of
 Preferred Shares

	  	 (4)
Aggregate Number
of
 Warrant Shares

	  	 (5)
 Legal Representative’s
Address, Facsimile Number
and E-mail Address

	 Westhampton
 Energy Investors I, LLC
	  	3400 Peachtree Road, N.E.
Suite 1720
Atlanta, GA 30326
Attention: Matthew Goodwin
Facsimile No.: 404-442-5683
E-mail: Goodwin@westhamptonpartners.com	  	800	  	1,000,000	  	 

 EXHIBITS 
  

			
	Exhibit A	  	Form of Certificate of Designations
	Exhibit B	  	Form of Warrant
	Exhibit C	  	Form of Registration Rights Agreement

  
 SCHEDULES

  

			
	Schedule 3(a)	  	Organization and Qualification
	Schedule 3(d)	  	No Conflicts
	Schedule 3(e)	  	Consents
	Schedule 3(k)	  	SEC Documents; Financial Statements
	Schedule 3(l)	  	Absence of Certain Changes
	Schedule 3(m)	  	Undisclosed Events, Liabilities, Developments or Circumstances
	Schedule 3(n)	  	Conduct of Business; Regulatory Permits
	Schedule 3(p)	  	Transactions with Affiliates
	Schedule 3(q)	  	Equity Capitalization
	Schedule 3(r)	  	Indebtedness and Other Contracts
	Schedule 3(t)	  	Insurance
	Schedule 3(z)	  	Tax Status

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