Document:

Exhibit 10.4

 

Execution Version

 

 

 

REGISTRATION RIGHTS AGREEMENT

 

THIS REGISTRATION
RIGHTS AGREEMENT (this “Agreement”), dated as of October 28, 2015 (the
“Effective Date”), is entered into by and between FTE NETWORKS, INC., a Nevada corporation (the “Company”),
Lateral Juscom Feeder LLC, a Delaware limited liability company (“WP”), and Lateral FTE Feeder LLC,
a Delaware limited liability company (“Feeder”
and together with WP and their respective permitted assigns, the “Lateral Parties”).

 

RECITALS

 

WHEREAS, concurrently
herewith, the Lateral Parties are providing up to $8,000,000 of senior secured term loans to Jus-Com, Inc., a wholly-owned subsidiary
of the Company (“Jus-Com”), pursuant to that certain Credit Agreement dated as of the Effective Date by and
among Jus-Com, the Company, the Lateral Parties and the other parties thereto (the “Loan Agreement”); and

 

WHEREAS, in
connection with the Loan Agreement, the Company has agreed to issue to the Lateral Parties 163,441 shares of the Company’s
Series D Convertible Preferred Stock (“Series D Stock”) and 253,067 shares of the Company’s Series F Convertible
Preferred Stock (“Series F Stock”), all convertible into shares of the Company’s common stock, $0.001
per share (“Common Stock”) (such shares of Common Stock, as issued to the Lateral Parties upon conversion of
the Series D Stock and Series F Stock, together with such other shares of Common Stock (or shares convertible into Common Stock)
issued by the Company to the Lateral Parties pursuant to the Company’s obligations under the Loan Agreement, collectively
the “New Shares”); and

 

WHEREAS, to
induce the Lateral Parties to enter into the Loan Agreement, the Company has agreed to provide to the Lateral Parties, regarding
the New Shares, certain registration rights under the Securities Act of 1933, as amended, and the rules and regulations promulgated
thereunder, or any similar successor statute (collectively, the “Securities Act”), and applicable state securities
laws; and

 

WHEREAS, as
a condition and inducement to the Lateral Parties’ willingness to enter into the Loan Agreement and to proceed with the transactions
contemplated thereby, the Lateral Parties and the Company are entering into this Agreement; and

 

WHEREAS, the
Company acknowledges that the Lateral Parties is entering into the Loan Agreement in reliance on the representations, warranties,
covenants and other agreements of, the Company set forth in this Agreement and would not enter into the Loan Agreement if the Company
did not enter into this Agreement.

 

NOW, THEREFORE,
in consideration of the promises and the mutual covenants contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the Lateral Parties hereby agree as follows:

 

AGREEMENT

 

		1.	DEFINITIONS.

 

As used in this Agreement,
the following terms shall have the following meanings:

 

     

     

    

 

 

a.“Business
Day” means any day on which the Principal Market is open for trading, including any day on which the Principal Market
is open for trading for a period of time less than the customary time.

 

b.“Issuer
Free Writing Prospectus” means an issuer free writing prospectus, as defined in Rule 433 under the Securities Act, relating
to an offer of Registrable Securities.

 

c.The “Lateral
Parties” include WP and Feeder, any transferee or assignee thereof to whom WP and/or Feeder assigns its rights under
this Agreement in accordance with Section 9 and who agrees to become bound by the provisions of this Agreement, and any
transferee or assignee thereof to whom a transferee or assignee assigns its rights under this Agreement in accordance with Section
9 and who agrees to become bound by the provisions of this Agreement.

 

d.“National
Exchange” shall mean The NASDAQ Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market, the New York
Stock Exchange, the NYSE MKT, the OTCQB or the OTCQX operated by the OTC Markets Group, Inc. (or any nationally recognized successor
to any of the foregoing).

 

e.“Person”
means any individual or entity including but not limited to any corporation, a limited liability company, an association, a partnership,
an organization, a business, an individual, a governmental or political subdivision thereof or a governmental agency.

 

f.“Principal
Market” means the OTCBB (or any nationally recognized successor thereto); provided, however, that in the event the Common
Stock is ever listed or traded on The NASDAQ Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market, the New
York Stock Exchange, the NYSE MKT, the OTCQB or the OTCQX operated by the OTC Markets Group, Inc. (or any nationally recognized
successor to any of the foregoing), then the “Principal Market” shall mean such other market or exchange on which the
Common Stock is then listed or traded.

 

g.“Register,”
“registered,” and “registration” refer to a registration effected by preparing and filing
one or more registration statements of the Company in compliance with the Securities Act and pursuant to Rule 415 under the Securities
Act or any successor rule providing for offering securities on a continuous basis (“Rule 415”), and the declaration
or ordering of effectiveness of such registration statement(s) by the United States Securities and Exchange Commission (the “SEC”).

 

h.“Registrable
Securities” means all of the New Shares which have been, or which may, from time to time be issued, or become issuable
to the Lateral Parties, and any and all shares of capital stock issued or issuable with respect to the New Shares as a result
of any stock split, stock dividend, recapitalization, exchange or similar event or otherwise.

 

i.“Registration
Statement” means one or more registration statements under the Securities Act of the Company covering the sale of the
Registrable Securities.

 

		2.	REGISTRATION.

 

a.Mandatory Registration.
Upon the earlier to occur of (i) the twentieth (20th) calendar day following the first (1st) anniversary of the Effective Date
or (ii) the listing of any of the Company’s securities on a National Exchange, file with the SEC an initial Registration
Statement covering the maximum number of Registrable Securities as shall be permitted to be included thereon in accordance with
applicable SEC rules, regulations and interpretations so as to permit the resale of such Registrable Securities by the Lateral
Parties under Rule 415 under the Securities Act at then prevailing market prices (and not fixed prices), as mutually determined
by both the Company and the Lateral Parties in consultation with their respective legal counsel. The Lateral Parties and their
counsel shall have a reasonable opportunity to review and comment upon such Registration Statement and any amendment or supplement
to such Registration Statement and any related prospectus prior to its filing with the SEC, and the Company shall give due consideration
to all reasonable comments. The Lateral Parties shall furnish all information reasonably requested by the Company for inclusion
therein. The Company shall use commercially reasonable efforts to have the Registration Statement and any amendment declared effective
by the SEC at the earliest possible date. The Company shall use reasonable best efforts to keep the Registration Statement effective
pursuant to Rule 415 promulgated under the Securities Act and available for resale by the Lateral Parties of all of the Registrable
Securities covered thereby at all times as the Lateral Parties may reasonably request (the “Registration Period”).

 

     

     

    

 

b.Piggyback Registration.

 

(1)If, at any
time, the Company proposes or is required to register any of its equity securities under the Securities Act (other than pursuant
to (i) registrations on such form or similar form(s) solely for registration of securities in connection with an employee
benefit plan or dividend reinvestment plan or (ii) registrations pursuant to Section 2(b) on a registration statement
on Form S-1 or Form S-3 or an equivalent general registration form then in effect, whether or not for its own account,
the Company shall give prompt written notice of its intention to do so to the Lateral Parties. Upon the written request of any
Lateral Party, made within 15 days following the receipt of any such written notice (which request shall specify the maximum number
of Registrable Securities intended to be disposed of by such Lateral Party and the intended method of distribution thereof), the
Company shall, subject to Section 2(b)(2) and Section 2(b)(3), use reasonable best efforts to cause all such Registrable
Securities to be included in the registration statement with the securities that the Company at the time proposes to register to
permit the sale or other disposition by the Lateral Parties in accordance with the intended method of distribution thereof of the
Registrable Securities to be so registered. No registration of Registrable Securities effected under this Section 2(b)
shall relieve the Company of its obligations to effect registrations under Section 2(a).

 

(2)If, at any
time after giving written notice of its intention to register any equity securities and prior to the effective date of the Registration
Statement filed in connection with such registration, the Company shall determine for any reason not to register or to delay registration
of such equity securities, the Company will give written notice of such determination to each Lateral Party holding Registrable
Securities and (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable
Securities in connection with such abandoned registration, without prejudice, however, to the rights of Holders under Section 2(a)
and (ii) in the case of a determination to delay such registration of its equity securities, shall be permitted to delay the
registration of such Registrable Securities for the same period as the delay in registering such other equity securities. The Lateral
Parties shall have the right to withdraw their request for inclusion of its Registrable Securities in any registration statement
pursuant to this Section 2(b) by giving written notice to the Company of its request to withdraw. Such request must
be made in writing prior to the earlier of the execution of the underwriting agreement or the execution of the custody agreement
with respect to such registration. Such withdrawal shall be irrevocable and, after making such withdrawal, a Lateral Party shall
no longer have any right to include Registrable Securities in the registration as to which such withdrawal was made.

 

(3)If any registration
pursuant to Section 2(b) involves an underwritten offering that was proposed by the Company or holders of securities of
the Company that have the right to require such registration pursuant to an agreement entered into by the Company in accordance
with Section 11 and the lead managing underwriter of such offering (the “Manager”) shall advise the Company
that, in its view, the number of securities requested to be included in such registration exceeds the number (the “Maximum
Sale Number”) that can be sold in an orderly manner in such registration within a price range acceptable to the Company,
the Company shall include in such registration:

     

     

    

(A)first, all
Common Stock that the Company proposes to register for its own account; and

 

(B)second, all
Registrable Securities that the Lateral Parties propose to register to the extent that the number of securities to be included
pursuant to clause (A) above is less than the Maximum Sale Number; and

 

(C)third, to
the extent the number of securities to be included pursuant to clauses (A) and (B) above is less than the Maximum Sale Number,
the remaining shares to be included in such registration shall be allocated on a pro rata basis among all holders requesting that
their shares of Common Stock be registered based on the aggregate number of shares of Common Stock owned by each holder requesting
inclusion in relation to the aggregate number of shares of Common Stock owned by all holders requesting inclusion, up to the Maximum
Sale Number.

 

d.Rule 424 Prospectus.
The Company shall, as required by applicable securities regulations, from time to time file with the SEC, pursuant to Rule 424
promulgated under the Securities Act, the prospectus and prospectus supplements, if any, to be used in connection with sales of
the Registrable Securities under the Registration Statement. The Lateral Parties and their counsel shall have a reasonable opportunity
to review and comment upon such prospectus and prospectus supplements prior to its filing with the SEC, and the Company shall give
due consideration to all such comments. The Lateral Parties shall comment upon such prospectus within five (5) Business Days from
the date the Lateral Parties receives the final pre-filing version of such prospectus or prospectus supplement, as applicable.

 

e.Sufficient Number
of Shares Registered. In the event the number of shares available under the Registration Statement is insufficient to cover
all of the Registrable Securities, the Company shall amend the Registration Statement or file a new Registration Statement (a “New
Registration Statement”), so as to cover all of such Registrable Securities (subject to the limitations set forth in
Section 2(a)) as soon as practicable, but in any event not later than twenty (20) Business Days after the necessity therefor
arises, subject to any limits that may be imposed by the SEC pursuant to Rule 415 under the Securities Act. The Company shall use
it reasonable best efforts to cause such amendment and/or New Registration Statement to become effective as soon as practicable
following the filing thereof.

 

f.Offering.
If the staff of the SEC (the “Staff”) or the SEC seeks to characterize any offering pursuant to a Registration
Statement filed pursuant to this Agreement as constituting an offering of securities that does not permit such Registration Statement
to become effective and be used for resales by the Lateral Parties under Rule 415 at then-prevailing market prices (and not fixed
prices), or if after the filing of the initial Registration Statement with the SEC pursuant to Section 2(a), the Company
is otherwise required by the Staff or the SEC to reduce the number of Registrable Securities included in such initial Registration
Statement, then the Company shall reduce the number of Registrable Securities to be included in such initial Registration Statement
(with the prior consent, which shall not be unreasonably withheld, of the Lateral Parties and its legal counsel as to the specific
Registrable Securities to be removed therefrom) until such time as the Staff and the SEC shall so permit such Registration Statement
to become effective and be used as aforesaid. In the event of any reduction in Registrable Securities pursuant to this paragraph,
the Company shall file one or more New Registration Statements in accordance with Section 2(c) until such time as all Registrable
Securities have been included in Registration Statements that have been declared effective and the prospectus contained therein
is available for use by the Lateral Parties. Notwithstanding any provision herein to the contrary, the Company’s obligations
to register Registrable Securities (and any related conditions to the Lateral Parties’ obligations) shall be qualified as
necessary to comport with any requirement of the SEC or the Staff as addressed in this Section 2(d).

 

     

     

    

 

		3.	RELATED OBLIGATIONS.

 

With respect to the
Registration Statement and whenever any Registrable Securities are to be registered pursuant to Section 2 including on any
New Registration Statement, the Company shall use its reasonable best efforts to effect the registration of the Registrable Securities
in accordance with the intended method of disposition thereof and, pursuant thereto, the Company shall have the following obligations:

 

a.The Company shall
prepare and file with the SEC such amendments (including post-effective amendments) and supplements to any Registration Statement
and the prospectus used in connection with such Registration Statement, which prospectus is to be filed pursuant to Rule 424 promulgated
under the Securities Act, as may be necessary to keep the Registration Statement or any New Registration Statement effective at
all times during the Registration Period, and, during such period, comply with the provisions of the Securities Act with respect
to the disposition of all Registrable Securities of the Company covered by the Registration Statement or any New Registration Statement
until such time as all of such Registrable Securities shall have been disposed of in accordance with the intended methods of disposition
by the seller or sellers thereof as set forth in such registration statement.

 

b.The Company shall
permit the Lateral Parties to review and comment upon the Registration Statement or any New Registration Statement and all amendments
and supplements thereto, or any Issuer Free Writing Prospectus related thereto, at least five (5) Business Days prior to their
filing with the SEC, and not file any document in a form to which the Lateral Parties reasonably objects. The Lateral Parties shall
comment upon the Registration Statement or any New Registration Statement and any amendments or supplements thereto within four
(4) Business Days from the date the Lateral Parties receive the final version thereof. The Company shall furnish to the Lateral
Parties, without charge any correspondence from the SEC or the Staff to the Company or its representatives relating to the Registration
Statement or any New Registration Statement.

 

c.Upon request of
the Lateral Parties, the Company shall furnish to the Lateral Parties, (i) promptly after the same is prepared and filed with the
SEC, at least one copy of such Registration Statement and any amendment(s) thereto, including financial statements and schedules,
all documents incorporated therein by reference and all exhibits, (ii) upon the effectiveness of any Registration Statement, a
copy of the prospectus included in such Registration Statement and all amendments and supplements thereto (or such other number
of copies as the Lateral Parties may reasonably request) and (iii) such other documents, including copies of any preliminary or
final prospectus, as the Lateral Parties may reasonably request from time to time in order to facilitate the disposition of the
Registrable Securities owned by the Lateral Parties. For the avoidance of doubt, any filing available to the Lateral Parties via
the SEC’s live EDGAR system shall be deemed “furnished to the Lateral Parties” hereunder.

 

d.The Company shall
use commercially reasonable efforts to (i) register and qualify the Registrable Securities covered by a registration statement
under such other securities or “blue sky” laws of such jurisdictions in the United States as the Lateral Parties reasonably
request, (ii) prepare and file in those jurisdictions, such amendments (including post-effective amendments) and supplements to
such registrations and qualifications as may be necessary to maintain the effectiveness thereof during the Registration Period,
(iii) take such other actions as may be necessary to maintain such registrations and qualifications in effect at all times during
the Registration Period, and (iv) take all other actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not be required in connection therewith or as a condition
thereto to (x) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section
3(d), (y) subject itself to general taxation in any such jurisdiction, or (z) file a general consent to service of process
in any such jurisdiction. The Company shall promptly notify the Lateral Parties who hold Registrable Securities of the receipt
by the Company of any notification with respect to the suspension of the registration or qualification of any of the Registrable
Securities for sale under the securities or “blue sky” laws of any jurisdiction in the United States or its receipt
of actual notice of the initiation or threatening of any proceeding for such purpose.

 

     

     

    

 

e.As promptly as
practicable after becoming aware of such event or facts, the Company shall notify the Lateral Parties in writing of the happening
of any event or existence of such facts as a result of which the prospectus included in any Registration Statement, as then in
effect, or any Issuer Free Writing Prospectus related thereto, includes an untrue statement of a material fact or omits to state
a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and promptly prepare a supplement or amendment to such Registration Statement to correct
such untrue statement or omission, and deliver a copy of such supplement or amendment to the Lateral Parties (or such other number
of copies as the Lateral Parties may reasonably request). The Company shall also promptly notify the Lateral Parties in writing
(i) when a prospectus or any prospectus supplement or post-effective amendment has been filed, and when a Registration Statement
or any post-effective amendment has become effective (notification of such effectiveness shall be delivered to the Lateral Parties
by email or facsimile on the same day of such effectiveness and by overnight mail), (ii) of any request by the SEC for amendments
or supplements to any Registration Statement or related prospectus or related information, and (iii) of the Company’s reasonable
determination that a post-effective amendment to a Registration Statement would be appropriate.

 

f.The Company shall
use its reasonable best efforts to prevent the issuance of any stop order or other suspension of effectiveness of any Registration
Statement, or the suspension of the qualification of any Registrable Securities for sale in any jurisdiction and, if such an order
or suspension is issued, to obtain the withdrawal of such order or suspension at the earliest possible moment and to notify the
Lateral Parties of the issuance of such order and the resolution thereof or its receipt of actual notice of the initiation or threat
of any proceeding for such purpose.

 

g.The Company shall
(i) cause all the Registrable Securities to be listed on each securities exchange on which securities of the same class or series
issued by the Company are then listed, if any, if the listing of such Registrable Securities is then permitted under the rules
of such exchange, or (ii) secure designation and quotation of all the Registrable Securities on the Principal Market. The Company
shall pay all fees and expenses in connection with satisfying its obligation under this Section 3.

 

h.The Company shall
cooperate with the Lateral Parties to facilitate the timely preparation and delivery of certificates (not bearing any restrictive
legend) representing the Registrable Securities to be offered pursuant to any Registration Statement and enable such certificates
to be in such denominations or amounts as the Lateral Parties may reasonably request and registered in such names as the Lateral
Parties may request.

 

     

     

    

 

i.The Company shall
at all times provide and cause to be maintained a transfer agent and registrar with respect to its Common Stock.

 

j.If reasonably requested
by the Lateral Parties, the Company shall (i) immediately incorporate in a prospectus supplement or post-effective amendment such
information as the Lateral Parties believe should be included therein relating to the sale and distribution of Registrable Securities,
including, without limitation, information with respect to the number of Registrable Securities being sold, the purchase price
being paid therefor and any other terms of the offering of the Registrable Securities; (ii) make all required filings of such prospectus
supplement or post-effective amendment as soon as practicable upon notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement.

 

k.The Company shall
use its reasonable best efforts to cause the Registrable Securities covered by any Registration Statement to be registered with
or approved by such other governmental agencies or authorities as may be reasonably deemed necessary by the Lateral Parties to
consummate the disposition of such Registrable Securities.

 

l.Within one (1)
Business Day after any Registration Statement which includes the Registrable Securities is ordered effective by the SEC, the Company
shall deliver, and shall cause legal counsel for the Company to deliver, to the transfer agent for such Registrable Securities
(with copies to the Lateral Parties) confirmation that such Registration Statement has been declared effective by the SEC. Thereafter,
if requested by the Lateral Parties at any time, the Company shall require its counsel to deliver to the Lateral Parties a written
confirmation as to whether or not the effectiveness of such Registration Statement has lapsed at any time for any reason (including,
without limitation, the issuance of a stop order) and whether or not the Registration Statement is current and available to the
Lateral Parties for sale of all of the Registrable Securities.

 

m.The Company shall
take all other reasonable actions necessary to expedite and facilitate disposition by the Lateral Parties of Registrable Securities
pursuant to any Registration Statement.

 

		4.	OBLIGATIONS OF THE LATERAL PARTIES.

 

a.The Company shall
notify the Lateral Parties in writing of the information the Company reasonably requires from the Lateral Parties in connection
with any Registration Statement hereunder. The Lateral Parties shall furnish to the Company such information regarding itself,
the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it as shall
be reasonably required to effect the registration of such Registrable Securities and shall execute such documents in connection
with such registration as the Company may reasonably request.

 

b.The Lateral Parties
agree to timely cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing
of any Registration Statement hereunder.

 

c.The Lateral Parties
agree that, upon receipt of any notice from the Company of the happening of any event or existence of facts of the kind described
in Section 3(f) or the first sentence of 3(e), the Lateral Parties will immediately discontinue disposition of Registrable
Securities pursuant to any Registration Statement(s) covering such Registrable Securities until the Lateral Parties’ receipt
of the copies of the supplemented or amended prospectus contemplated by Section 3(f) or the first sentence of 3(e).

 

     

     

    

 

		5.	INDEMNIFICATION.

 

a.To the fullest
extent permitted by law, the Company will, and hereby does, indemnify, hold harmless and defend the Lateral Parties, each Person,
if any, who controls each of the Lateral Parties within the meaning of the Securities Act or the Exchange Act, the members, the
directors, officers, general and limited partners, employees, agents, representatives, fiduciaries, affiliates, consultants, stockholders,
successors and assigns of the Lateral Parties and each Person, if any, who controls the Lateral Parties within the meaning of the
Securities Act or the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (each, an “Indemnified
Person”), against any losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs, attorneys’
fees, amounts paid in settlement or expenses, joint or several, incurred in investigating, preparing or defending any action, claim,
suit, inquiry, proceeding, investigation or appeal taken from the foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the SEC, whether pending or threatened, whether or not an indemnified party is or may be a
party thereto (“Indemnified Damages”), to which any of them may become subject insofar as such claims (or actions
or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon: (i) any untrue statement or
alleged untrue statement of a material fact in the Registration Statement, any New Registration Statement or any post-effective
amendment thereto or in any filing made in connection with the qualification of the offering under the securities or other “blue
sky” laws of any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”), or the
omission or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein
not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in any preliminary, final or
summary prospectus (as amended or supplemented, if the Company files any amendment thereof or supplement thereto with the SEC)
together with the documents incorporated by reference therein, or any Issuer Free Writing Prospectus utilized in connection therewith
or the omission or alleged omission to state therein any material fact necessary to make the statements made therein, in light
of the circumstances under which the statements therein were made, not misleading, (iii) any violation or alleged violation by
the Company of the Securities Act, the Exchange Act, any other law, including, without limitation, any state securities law, or
any rule or regulation thereunder relating to the offer or sale of the Registrable Securities pursuant to the Registration Statement
or any New Registration Statement or (iv) any material violation by the Company of this Agreement (the matters in the foregoing
clauses (i) through (iv) being, collectively, “Violations”). Notwithstanding anything to the contrary contained
herein, the indemnification agreement contained in this Section 6(a): (i) shall not apply to any Indemnified Damages arising
out of or based upon a Violation which occurs in reliance upon and in conformity with information about the Lateral Parties furnished
in writing to the Company by such Indemnified Person expressly for use in connection with the preparation of the Registration Statement,
any New Registration Statement or any such amendment thereof or supplement thereto, if such prospectus was timely made available
to the Lateral Parties by the Company pursuant to Section 3(c) or Section 3(e); (ii) with respect to any superseded
prospectus, shall not inure to the benefit of any such person from whom the person asserting any such claim purchased the Registrable
Securities that are the subject thereof (or to the benefit of any person controlling such person) if the untrue statement or omission
of material fact contained in the superseded prospectus was corrected in the revised prospectus, as then amended or supplemented,
if such revised prospectus was timely made available to the Lateral Parties by the Company pursuant to Section 3(c) or Section
3(e), and the Indemnified Person was promptly advised in writing not to use the incorrect prospectus prior to the use giving
rise to a violation and such Indemnified Person, notwithstanding such advice, used it; (iii) shall not be available to the extent
such claim is based on a failure of the Lateral Parties to deliver or to cause to be delivered the prospectus made available by
the Company, if such prospectus was timely made available to the Lateral Parties by the Company pursuant to Section 3(c)
or Section 3(e); and (iv) shall not apply to amounts paid in settlement of any claim if such settlement is effected without
the prior written consent of the Company, which consent shall not be unreasonably withheld. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the Indemnified Person and shall survive the transfer
of the Registrable Securities by the Lateral Parties pursuant to Section 9.

 

     

     

    

 

b.In connection with
the Registration Statement or any New Registration Statement, the Lateral Parties agree to indemnify, hold harmless and defend,
to the same extent and in the same manner as is set forth in Section 6(a), the Company, each of its directors, each of its
officers who signs the Registration Statement or any New Registration Statement, each Person, if any, who controls the Company
within the meaning of the Securities Act or the Exchange Act (collectively and together with an Indemnified Person, an “Indemnified
Party”), against any Indemnified Damages to which any of them may become subject, under the Securities Act, the Exchange
Act or otherwise, insofar as such Indemnified Damages arise out of or are based upon any Violation, in each case to the extent,
and only to the extent, that such Violation occurs in reliance upon and in conformity with written information about the Lateral
Parties and furnished to the Company by the Lateral Parties expressly for use in connection with such Registration Statement; and,
subject to Section 6(d), The Lateral Parties will reimburse any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such claim; provided, however, that the indemnity agreement contained in this Section 6(b)
and the agreement with respect to contribution contained in Section 7 shall not apply to amounts paid in settlement of any
claim if such settlement is effected without the prior written consent of Lateral, which consent shall not be unreasonably withheld;
provided, further, however, that the Lateral Parties shall be liable under this Section 6(b) for only that amount of Indemnified
Damages as does not exceed the net proceeds to the Lateral Parties as a result of the sale of Registrable Securities pursuant to
such Registration Statement. Such indemnity shall remain in full force and effect regardless of any investigation made by or on
behalf of such Indemnified Party and shall survive the transfer of the Registrable Securities by the Lateral Parties pursuant to
Section 9.

 

c.Promptly after
receipt by an Indemnified Person or Indemnified Party under this Section 6 of notice of the commencement of any action or
proceeding (including any governmental action or proceeding) involving a claim for Indemnified Damages, such Indemnified Person
or Indemnified Party shall, if a claim for Indemnified Damages in respect thereof is to be made against any indemnifying party
under this Section 6, deliver to the indemnifying party a written notice of the commencement of such claim, and the indemnifying
party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume control of the defense thereof with counsel mutually satisfactory to the indemnifying party
and the Indemnified Person or the Indemnified Party, as the case may be; provided, however, that an Indemnified Person or Indemnified
Party shall have the right to retain its own counsel with the fees and expenses to be paid by the indemnifying party, if, (i) in
the reasonable opinion of counsel retained by the Indemnified Person or the Indemnified Party, the representation by such counsel
of the Indemnified Person or Indemnified Party and the indemnifying party would be inappropriate due to actual or potential differing
interests between such Indemnified Person or Indemnified Party and any other party represented by such counsel in such proceeding,
(ii) the indemnifying party fails to take reasonable steps necessary to defend diligently the action or proceeding within twenty
(20) days after receiving notice from the Indemnified Person or Indemnified Party, or (iii) if such Indemnified Person or Indemnified
Party who is a defendant in any action or proceeding that is also brought against the indemnifying party reasonably shall have
concluded that there may be one or more legal defenses available to such indemnified party that are not available to the indemnifying
party. The Indemnified Party or Indemnified Person shall cooperate fully with the indemnifying party in connection with any negotiation
or defense of any such action or claim by the indemnifying party and shall furnish to the indemnifying party all information reasonably
available to the Indemnified Party or Indemnified Person which relates to such action or claim. The indemnifying party shall keep
the Indemnified Party or Indemnified Person fully apprised at all times as to the status of the defense or any settlement negotiations
with respect thereto. No indemnifying party shall be liable for any settlement of any action, claim or proceeding effected without
its written consent, provided, however, that the indemnifying party shall not unreasonably withhold, delay or condition its consent.
No indemnifying party shall, without the consent of the Indemnified Party or Indemnified Person, consent to entry of any judgment
or enter into any settlement or other compromise which (i) does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such Indemnified Party or Indemnified Person of a release from all liability in respect to such claim
or litigation or (ii) does include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf
of any Indemnified Party or Indemnified Person. Following indemnification as provided for hereunder, the indemnifying party shall
be subrogated to all rights of the Indemnified Party or Indemnified Person with respect to all third parties, firms or corporations
relating to the matter for which indemnification has been made. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the extent that the indemnifying party is materially
prejudiced in its ability to defend such action.

 

     

     

    

 

d.The indemnification
required by this Section 6 shall be made by periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.

 

e.The indemnity agreements
contained herein shall be in addition to (i) any cause of action or similar right of the Indemnified Party or Indemnified Person
against the indemnifying party or others, and (ii) any liabilities the indemnifying party may be subject to pursuant to the law.

 

		7.	CONTRIBUTION.

 

To the extent any indemnification
by an indemnifying party is prohibited or limited by law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the fullest extent permitted by law; provided,
however, that: (i) no seller of Registrable Securities guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any seller of Registrable Securities who was not guilty of fraudulent
misrepresentation; and (ii) contribution by any seller of Registrable Securities shall be limited in amount to the net amount of
proceeds received by such seller from the sale of such Registrable Securities.

 

		8.	REPORTS AND DISCLOSURE UNDER THE SECURITIES ACTS.

 

With a view to making
available to the Lateral Parties the benefits of Rule 144 promulgated under the Securities Act or any other similar rule or regulation
of the SEC that may at any time permit the Lateral Parties to sell securities of the Company to the public without registration
(“Rule 144”), the Company agrees, at the Company’s sole expense, to:

 

a.make and keep public
information available, as those terms are understood and defined in Rule 144;

 

b.file with the SEC
in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act so long
as the Company remains subject to such requirements and the filing of such reports and other documents is required for the applicable
provisions of Rule 144;

 

     

     

    

 

c.furnish to the
Lateral Parties so long as the Lateral Parties own Registrable Securities, promptly upon request, (i) a written statement by the
Company that it has complied with the reporting and or disclosure provisions of Rule 144, the Securities Act and the Exchange
Act, (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by
the Company, and (iii) such other information as may be reasonably requested to permit the Lateral Parties to sell such securities
pursuant to Rule 144 without registration; and

 

d.take such additional action as is reasonably requested by the Lateral Parties
to enable the Lateral Parties to sell the Registrable Securities pursuant to Rule 144, including, without limitation, delivering
all such legal opinions, consents, certificates, resolutions and instructions to the Company’s Transfer Agent as may be
requested from time to time by the Lateral Parties and otherwise fully cooperate with the Lateral Parties and the Lateral Parties’
broker to effect such sale of securities pursuant to Rule 144.

 

		9.	ASSIGNMENT OF REGISTRATION RIGHTS.

 

The Company shall not
assign this Agreement or any rights or obligations hereunder without the prior written consent of the Lateral Parties. The Lateral
Parties may assign this Agreement and the rights hereunder to any Person to whom they transfer their Series D Stock, Series F Stock
and/or New Shares in connection with a transfer of their interest in the Loan Agreement.

 

		10.	AMENDMENT OF REGISTRATION RIGHTS.

 

No provision of this
Agreement may be amended or waived by the parties from and after the date that is one (1) Business Day immediately preceding the
initial filing of the Registration Statement with the SEC. Subject to the immediately preceding sentence, no provision of this
Agreement may be (i) amended other than by a written instrument signed by both parties hereto or (ii) waived other than in a written
instrument signed by the party against whom enforcement of such waiver is sought. Failure of any party to exercise any right or
remedy under this Agreement or otherwise, or delay by a party in exercising such right or remedy, shall not operate as a waiver
thereof.

 

     

     

    

 

11.   NO INCONSTENT
AGREEMENTS. The rights granted to the Lateral Parties hereunder do not in any way conflict with and are not inconsistent with
any other agreements to which the Company is a party or by which it is bound. Without the prior written consent of the Lateral
Parties, the Company will not enter into any agreement with respect to its securities that is inconsistent with the rights granted
in this Agreement or otherwise conflicts with the provisions hereof or provides terms and conditions that are more favorable to,
or less restrictive on, the other party thereto than the terms and conditions contained in this Agreement are to the Lateral Parties,
other than any lock-up agreement with the underwriters in connection with any registered offering effected hereunder, pursuant
to which the Company shall agree not to register for sale, and the Company shall agree not to sell or otherwise dispose of, Common
Stock or any securities convertible into or exercisable or exchangeable for Common Stock, for a specified period following the
registered offering. If the Company enters into any other registration rights agreement with respect to any of its securities that
contains terms that are more favorable to, or less restrictive on, the other party thereto than the terms and conditions contained
in this Agreement are to the Lateral Parties, the terms and conditions of this Agreement shall immediately be deemed to have been
amended without further action by the Company or any of the Lateral Parties so that the Lateral Parties shall each be entitled
to the benefit of any such more favorable or less restrictive terms or conditions.

 

		12.	MISCELLANEOUS.

 

a.A Person is deemed
to be a holder of Registrable Securities whenever such Person owns or is deemed to own of record such Registrable Securities. If
the Company receives conflicting instructions, notices or elections from two or more Persons with respect to the same Registrable
Securities, the Company shall act upon the basis of instructions, notice or election received from the registered owner of such
Registrable Securities.

 

b.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 or email
(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 a nationally recognized overnight delivery service, in each case properly addressed to
the party to receive the same. The addresses for such communications shall be:

 

If to the Company:

FTE Networks, Inc.

5495 Bryson Drive, Suite 423

Naples, Florida 34109

Telephone:(877) 878-8136

Facsimile: (___) _____-________

E-mail:mpalleschi@ftenet.com

Attention: Michael Palleschi,
CEO

 

With a copy to (which shall not
constitute notice or service of process):

K&L Gates LLP

200 S. Biscayne Blvd., Ste. 3900

Miami, Florida 33131

Telephone:(305) 539-3306

Facsimile:(305) 358-7095

E-mail:clayton.parker@klgates.com

Attention:Clayton E. Parker,
Esq.

 

     

     

    

 

If to the Lateral Parties:

Lateral Global Laterals, LLC

1825 South Grant Street, Suite
210

San Mateo, CA 94402

Telephone:(650) 396-2200

Facsimile:(773) 496-2949

E-mail:patrick@lateralim.com

Attention:Patrick Feeney, Principal

 

With a copy to (which shall not
constitute notice or service of process):

Gibson, Dunn & Crutcher LLP

2029 Century Park East, Suite 4000

Los Angeles, CA 90067

Attention: Cromwell Montgomery,
Esq.

Facsimile: 310-552-7063

E-mail: cmontgomery@gibsondunn.com

 

     

     

    

 

or at 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 three (3) Business Days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the recipient
of such notice, consent, waiver or other communication, (B) mechanically or electronically generated by the sender’s facsimile
machine or email account containing the time, date, recipient facsimile number or email address, as applicable, and an image of
the first page of such transmission or (C) provided by a nationally recognized overnight delivery service, shall be rebuttable
evidence of personal service, receipt by facsimile or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.

 

c.The corporate laws
of the State of Delaware shall govern all issues concerning the relative rights of the Company and its stockholders. All other
questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal
laws of the State of Delaware, without giving effect to any choice of law or conflict of law provision or rule (whether of the
State of Delaware or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the
State of Delaware. Each party hereby irrevocably submits to the exclusive jurisdiction of the Delaware Court of Chancery and any
appellate court therefrom within the State of Delaware, 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. 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.
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 HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

     

     

    

 

d.This Agreement
constitutes the entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to herein and therein. This Agreement supersedes all
prior agreements and understandings among the parties hereto with respect to the subject matter hereof and thereof.

 

e.Subject to the
requirements of Section 9, this Agreement shall inure to the benefit of and be binding upon the successors and permitted
assigns of each of the parties hereto.

 

f.The headings in
this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

 

g.This Agreement
may be executed in identical counterparts, each of which shall be deemed an original but all of which shall constitute one and
the same agreement. This Agreement, once executed by a party, may be delivered to the other party hereto by facsimile transmission
or by e-mail in a “.pdf” format data file of a copy of this Agreement bearing the signature of the party so delivering
this Agreement.

 

h.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.

 

i.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.

 

j.This Agreement
is intended for the benefit of the parties hereto and their respective successors and permitted assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.

 

* * * * * *

 

     

     

    

 

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

 

 

 

THE COMPANY:

 

FTE NETWORKS, INC.

 

By: /s/ Michael Palleschi

Name: Michael Palleschi

Title: Chief Executive Officer

 

 

LATERAL PARTIES: 

 

LATERAL JUSCOM FEEDER LLC

By: Lateral Global Investors, LLC, its Manager

 

 

By: 

Name:

Title: 

 

LATERAL FTE FEEDER LLC

By: Lateral Global Investors, LLC, its Manager

 

 

By: 

Name:

Title:

 

 

Signature
Page to Registration Rights AgreementExhibit 10.5 

 

Execution Version

 

REDEMPTION RIGHTS AGREEMENT

 

This Redemption Rights
Agreement (the “Agreement”), dated October 28, 2015 (the “Effective Date”), is entered into
by and between FTE NETWORKS, INC., a Nevada corporation (the “Company”), and Lateral Juscom Feeder
LLC, a Delaware limited liability company (“WP”), and Lateral FTE Feeder LLC, a Delaware limited
liability company (together with WP, the “Lateral Parties”).

 

RECITALS

 

WHEREAS, concurrently
herewith, the Lateral Parties are providing up to $8,000,000 of senior secured term loans to Jus-Com, Inc., a wholly-owned subsidiary
of the Company (“Jus-Com”), pursuant to that certain Credit Agreement dated as of the Effective Date by and
among Jus-Com, the Company, the Lateral Parties and the other parties thereto (the “Loan Agreement”); and

 

WHEREAS, in
connection with the Loan Agreement, the Company issued to the Lateral Parties 163,441 shares of the Company’s Series D Convertible
Preferred Stock (“Series D Stock”) and 253,067 shares of the Company’s Series F Convertible Preferred
Stock (“Series F Stock”), all convertible into shares of the Company’s common stock, $0.001 per share
(“Common Stock”) (such shares of Common Stock, as issued to the Lateral Parties upon conversion of the Series
D Stock and Series F Stock, together with such other shares of Common Stock (or shares convertible into Common Stock) issued by
the Company to the Lateral Parties pursuant to the Company’s obligations under the Loan Agreement, collectively the “Redeemable
Shares”); and

 

WHEREAS, to
induce the Lateral Parties to enter into the Loan Agreement, the Company has agreed to provide to the Lateral Parties, regarding
the Redeemable Shares, certain redemption rights and the parties desire to set forth herein the terms and conditions upon which
the Lateral Parties may cause the Company to redeem its Redeemable Shares; and

 

WHEREAS, as
a condition and inducement to the Lateral Parties’ willingness to enter into the Loan Agreement and to proceed with the transactions
contemplated thereby, the Lateral Parties and the Company are entering into this Agreement; and

 

WHEREAS, the
Company acknowledges that the Lateral Parties are entering into the Loan Agreement in reliance on the representations, warranties,
covenants and other agreements of, the Company set forth in this Agreement and would not enter into the Loan Agreement if the Company
did not enter into this Agreement.

 

NOW, THEREFORE,
in consideration of the promises and the mutual covenants contained herein and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Company and the Lateral Parties hereby agree as follows:

 

AGREEMENT

 

1.                 
Definitions. For purposes of this Agreement, the following certain terms
shall have the meanings set forth below:

 

“Articles
of Incorporation” shall mean the Articles of Incorporation of the Company, as the same may be amended from time to time.

 

     

     

    

 

“Business
Day” shall mean any day upon which commercial banks are open for business in New York, New York.

 

“Common Stock”
shall have the meaning set forth in the recitals.

 

“Contractual
Obligations” means, as to any Person, any provision of any security (whether in the nature of Stock, Stock Equivalents
or otherwise) issued by such Person or of any agreement, undertaking, contract, indenture, mortgage, deed of trust or other instrument,
document or agreement (other than the Loan Agreement) to which such Person is a party or by which it or any of its Property is
bound or to which any of its Property is subject.

 

“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, or any successor statute.

 

“Expiration
Date” shall mean the date upon which all Redeemable Shares have been redeemed in accordance with the terms hereof.

 

“Governmental
Authority” means any nation, sovereign or government, any state or other political subdivision thereof, any agency, authority
or instrumentality thereof and any entity or authority exercising executive, legislative, taxing, judicial, regulatory or administrative
functions of or pertaining to government, including any central bank, stock exchange, regulatory body, arbitrator, public sector
entity, supra-national entity (including the European Union and the European Central Bank) and any self-regulatory organization
(including the National Association of Insurance Commissioners).

 

“Liens”
means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

 

“Lateral Ownership
Percentage” means the percentage derived from dividing the total number of shares of Redeemable Shares owned by the Lateral
Parties in the aggregate by the total number of shares of Common Stock outstanding on a fully diluted basis.

 

“LTM EBITDA”
means the Company’s earnings before interest, taxes, depreciation, and amortization plus principal and interest payments
made in respect of equipment financing for the prior twelve (12) consecutive months ending as of the most recent month-end preceding
the relevant measurement date, as such amount may be adjusted for unusual non-recurring charges and similar items.

 

“Major Transaction
Event” shall mean, with respect to the Company, (a) a reclassification, capital reorganization or other similar change
regarding or affecting outstanding shares of Common Stock, (b) a merger or consolidation of the Company with one or more other
corporations or entities, other than a merger pursuant to which the Company is the surviving corporation, (c) a sale, lease or
exchange of all or substantially all of the Company’s assets or (d) the liquidation, dissolution or winding up of the Company.

 

“Material
Adverse Effect” means an effect that results in or causes, or could reasonably be expected to result in or cause, a material
adverse change in any of (a) the condition (financial or otherwise), business, performance, operations or Property of the Company
and its Subsidiaries taken as a whole; or (b) the ability of the Company to perform its obligations under this Agreement.

 

“Permits”
means, with respect to any Person, any permit, approval, authorization, license, registration, certificate, concession, grant,
franchise, variance or permission from, and any other Contractual Obligations with, any Governmental Authority, in each case whether
or not having the force of law and applicable to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

 

     

     

    

 

“Permitted
Indebtedness” means (a) the indebtedness evidenced by the Loan Agreement and (b) any indebtedness existing on the Effective
Date, and (c) any indebtedness in an amount up to $400,000 in the aggregate.

 

“Per Share
Price” means an amount of cash equal to the Purchase Price divided by the aggregate number of Redeemable Shares then
held by the Lateral Parties.

 

“Person”
shall mean any natural person, corporation, partnership, association, limited liability company, trust or other entity.

 

“Property”
means any interest in any kind of property or asset, whether real, personal or mixed, and whether tangible or intangible.

 

“Purchase
Price” shall mean, with respect to the redeemed Redeemable Shares, an amount of cash equal to the following formula:
10 multiplied by LTM EBITDA multiplied by the Lateral Ownership Percentage.

 

“Redemption
Notice” shall have the meaning set forth in Section 3.2.

 

“Redemption
Price” shall mean, with respect to Redeemable Shares elected to be redeemed, an amount of cash equal to the number of
Redeemable Shares elected to be redeemed multiplied by the Per Share Price.

 

“Redemption
Rights” shall have the meaning set forth in Section 2.

 

“Redemption
Period” shall have the meaning set forth in Section 3.1.

 

“Requirement
of Law” means, with respect to any Person, the common law and any federal, state, local, foreign, multinational or international
laws, statutes, codes, treaties, standards, rules and regulations, guidelines, ordinances, orders, judgments, writs, injunctions,
decrees (including administrative or judicial precedents or authorities) and the interpretation or administration thereof by, and
other determinations, directives, requirements or requests of, any Governmental Authority, in each case whether or not having the
force of law and that are applicable to or binding upon such Person or any of its Property or to which such Person or any of its
Property is subject.

 

“SEC”
shall mean the U.S. Securities and Exchange Commission.

 

“Securities
Act” shall mean the Securities Act of 1933, as amended, or any successor statute.

 

“Stock”
means all shares of capital stock (whether denominated as common stock or preferred stock), equity interests, beneficial, partnership
or membership interests, joint venture interests, participations or other ownership or profit interests in or equivalents (regardless
of how designated) of or in a Person (other than an individual), whether voting or non-voting.

 

“Stock Equivalents”
means all securities convertible into or exchangeable for Stock or any other Stock Equivalent and all warrants, options or other
rights to purchase, subscribe for or otherwise acquire any Stock or any other Stock Equivalent, whether or not presently convertible,
exchangeable or exercisable.

 

     

     

    

 

“Subsidiary”
means, with respect to any Person, any corporation, partnership, joint venture, limited liability company, association or other
entity, the management of which is, directly or indirectly, controlled by, or of which an aggregate of more than fifty percent
(50%) of the voting Stock is, at the time, owned or controlled directly or indirectly by, such Person or one or more Subsidiaries
of such Person.

 

2.                 
Grant of Redemption Rights. Upon the terms and subject to the conditions
contained herein, the Company does hereby grant to the Lateral Parties, and the Lateral Parties do hereby accept, the right, but
without obligation on the part of the Lateral Parties, to require the Company to redeem from time to time, out of funds legally
available therefor, all or any part of the Redeemable Shares for the Redemption Price (“Redemption Rights”). The Lateral
Parties agree that they will not exercise their Redemption Rights pursuant to this Section 2 if the exercise of such Redemption
Rights would, in the good faith opinion of the Company’s accountants, prevent the Company from continuing as a going concern.

 

3.                 
Exercise of Redemption Rights.

 

3.1             
Time for Exercise of Redemption Rights. The Lateral Parties may exercise their
Redemption Rights at any time on or after the second (2nd) anniversary of the Effective Date, but prior to the Expiration Date
(the “Redemption Period”); provided that:

 

(a)               
The Redemption Rights may not be exercised unless either (i) the Company’s market capitalization on such date
is equal to or greater than $25,000,000, or (ii) the LTM EBITDA ending on the last day of the month preceding such date is greater
than $3,000,000.

 

(b)              
The Redemption Rights may not be exercised in the event that such exercise of Redemption Rights violates applicable
law.

 

(c)               
Once given, a Redemption Notice shall be irrevocable subject to the payment of the Redemption Price for the Redeemable
Shares specified therein in accordance with the terms hereof.

 

(d)              
Upon the delivery of any Redemption Notice (such date, a “Submission Date”) the submitting party
(or its successor to Redemption Rights, as applicable) shall not be entitled to deliver any subsequent Redemption Notice until
the expiration of 180 days following the Submission Date.

 

3.2             
Method of Exercise. The Redemption Rights shall be exercised by the Lateral
Parties’ delivery to the Company of (a) written notice (the “Redemption Notice”) in the form of Exhibit A, and
(b) the certificates, if any, representing such Redeemable Shares. 

 

3.3             
Closing. Each closing of the redemption pursuant to the exercise of the Redemption
Rights by the Lateral Parties (each a “Closing”) shall occur within 180 days following the Company’s receipt
of a Redemption Notice. The Lateral Parties shall execute such other documents as the Company may reasonably require in connection
with each Closing of such redemption.

 

3.4             
Payment of Cash. At each Closing of the redemption of the Redeemable Shares
pursuant to the exercise of Redemption Rights by the Lateral Parties, the Company shall deliver to the appropriate Lateral Party
the applicable Redemption Price by immediately available funds.

 

4.                 
Anti-Dilution. Until the time that
the Company has issued additional equity securities with an aggregate value of $5 million from and after the date hereof, in the
event that the Company issues additional equity securities following the Effective Date, the Company shall promptly issue to the
Lateral Parties additional shares of Common Stock such that following such issuances, the Lateral Parties shall maintain the
same percentage ownership of Company’s Common Stock on a fully diluted basis as the Lateral Parties maintained prior
to such issuance.

 

     

     

    

 

5.                 
Information Rights. If at any time
prior to the date that the Lateral Parties cease to own, collectively, less than 5% of the Common Stock of the Company on a fully-diluted
basis, the Company ceases to be a publicly reporting company under the Exchange Act, (a) the Company shall deliver to the Lateral
Parties unaudited monthly and audited annual financial statements, annual budgets and other financial information reasonably requested
by the Lateral Parties, and (b) the Company shall also permit the Lateral Parties or their authorized representatives, to visit
and inspect the corporate and financial records of the Company, and to discuss its business and finances with officers of the
Company, during normal business hours following reasonable notice and as often as may be reasonably requested. 

 

6.                 
Negative Covenants. For so long
as the Lateral Parties own, in the aggregate, at least 10% of the Company’s Common Stock on a fully diluted basis, unless
Lateral shall have otherwise given prior written consent, the Company shall not, directly or indirectly: 

 

(i)                
other than Permitted Indebtedness, enter into, create, incur, assume, guarantee or suffer to exist any indebtedness
for borrowed money of any kind, including, but not limited to, a guarantee, on or with respect to any of its property or assets
now owned or hereafter acquired or any interest therein or any income or profits therefrom;

 

(ii)              
undertake a Major Transaction Event;

 

(iii)            
terminate or replace its chief executive officer; or

 

(iv)            
enter into any agreement with respect to any of the foregoing.

 

7.                 
Representations and Warranties of the Company. The Company represents
and warrants to the Lateral Parties that:

 

7.1             
  Corporate Existence and Power. The Company and each of its Subsidiaries:

 

(a)               
 is a corporation, limited liability company or limited partnership, as applicable, duly organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation, organization or formation, as applicable;

 

(b)              
has the power and authority and all governmental licenses, authorizations, Permits, consents and approvals to own
its assets, carry on its business and execute, deliver, and perform its obligations under, the Agreement;

 

(c)               
is duly qualified as a foreign corporation, limited liability company or limited partnership, as applicable, and
licensed and in good standing, under the laws of each jurisdiction where its ownership, lease or operation of Property or the conduct
of its business requires such qualification or license; and

 

(d)              
is in compliance with all Requirements of Law;

 

     

     

    

 

(e)               
except, in each case referred to in clause (c) or clause (d), to the extent that the failure to do so would not reasonably
be expected to have, either individually or in the aggregate, a Material Adverse Effect.

 

7.2             
Corporate Authorization; No Contravention. The execution, delivery and performance by the Company of this
Agreement have been duly authorized by all necessary action, and do not and will not:

 

(a)               
contravene the terms of any of the Company’s organizational documents;

 

(b)              
conflict with or result in any material breach or contravention of, or result in the creation of any lien under,
any document evidencing any material Contractual Obligation to which such Person is a party or any order, injunction, writ or decree
of any Governmental Authority to which such Person or its Property is subject; or

 

(c)               
violate any material Requirement of Law in any material respect.

 

7.3             
Binding Effect. This Agreement constitutes the legal, valid and binding obligations of the Company, enforceable
against the Company in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency,
or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability.

 

7.4             
Capitalization. The authorized capital stock of the Company as of the date hereof consists of (i) 70,000,000
shares of Common Stock, of which 48,391,820 shares are issued and outstanding, and (ii) 5,000,000 shares of Preferred Stock, (a)
4,500 of which have been designated Series A Preferred Stock, 500 of which are issued and outstanding, (b) 4,500 of which have
been designated Series A-1 Preferred Stock, 295 of which are issued and outstanding, (c) 4,000 of which have been designated Series
B Preferred Stock, 0 of which are issued and are outstanding, (e) 400 of which have been designated Series C-1 Preferred Stock,
0 of which are issued and outstanding, (f) 2,000 of which have been designated Series C-2 Preferred Stock, 0 of which are issued
and outstanding, (g) 110 of which have been designated Series C-3 Preferred Stock, 0 of which are issued and outstanding, (h) 2,000,000
of which have been designated Series D Preferred Stock, 1,836,560 of which are issued and outstanding, (i) 1,000,000 of which have
been designated Series E Preferred Stock, 0 of which are issued and outstanding, and (j) 1,980,000 of which have been designated
Series F Preferred Stock, 0 of which are issued and outstanding, as of the date hereof. All shares of Common Stock and Preferred
Stock issued and outstanding as of the date hereof have been duly authorized and validly issued and are fully paid and nonassessable.
The Redeemable Shares issued (or to be issued) to Lateral are (or will be) duly and validly issued, fully paid and nonassessable
and free and clear of all liens and encumbrances. Except as described in Schedule 7 hereto, there are no (a) options,
warrants or other rights outstanding with respect to the capital stock or other securities of the Company, (b) securities
convertible into or exchangeable for shares of capital stock of the Company or (c) other commitments of any kind for the issuance
of additional shares of capital stock or options, warrants or other securities of the Company.

 

8.                 
Miscellaneous Provisions.

 

8.1             
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 or email (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
a nationally recognized overnight delivery service, in each case properly addressed to the party to receive the same. The addresses
for such communications shall be:

 

     

     

    

 

If to the Company:

FTE Networks,
Inc.

5495 Bryson
Drive, Suite 423

Naples, Florida
34109

Telephone:(877)
878-8136

Facsimile: (___)
_____-________

E-mail:mpalleschi@ftenet.com

Attention: Michael
Palleschi, CEO

 

With a copy to (which shall not
constitute notice or service of process):

K&L Gates LLP

200 S. Biscayne Blvd., Ste. 3900

Miami, Florida 33131

Telephone:(305) 539-3306

Facsimile:(305) 358-7095

E-mail:clayton.parker@klgates.com

Attention:Clayton E. Parker,
Esq.

 

If to the Lateral Parties:

Lateral Global Investments, LLC

1825 South Grant Street, Suite

San Mateo, CA 94402

Telephone:(650) 396-2200

Facsimile:(773) 496-2949

E-mail:patrick@lateralim.com

Attention:Patrick Feeney, Principal

 

With a copy
to (which shall not constitute notice or service of process):

Gibson, Dunn & Crutcher, LLP

2029 Century Park East, Suite 4000

Los Angeles, CA 90067

Telephone: 310-551-8744

Facsimile: 310-552-7063

E-mail:
cmontgomery@gibsondunn.com

Attention: Cromwell Montgomery,
Esq.

 

 

8.2             
Assignment. The Company may not assign this Agreement or the rights hereunder without
the prior written consent of The Lateral Parties. The Lateral Parties may assign this Agreement and the rights hereunder to any
Person to whom they transfer their Series D Stock, Series F Stock and/or Redeemable Shares in connection with a transfer of their
interest in the Loan Agreement.

 

8.3             
Binding Effect. Except as otherwise set forth herein, this Agreement shall be binding
upon, and inure to the benefit of, the parties and their successors and permitted assigns.

 

     

     

    

 

8.4             
Amendments. The provisions of this Agreement may be amended only with the written
consent of the Company and the Lateral Parties.

 

8.5             
Governing Law. The corporate laws of the State of Nevada shall govern all issues
concerning the relative rights of the Company and its stockholders. All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of Delaware, without giving
effect to any choice of law or conflict of law provision or rule (whether of the State of Delaware or any other jurisdictions)
that would cause the application of the laws of any jurisdictions other than the State of Delaware. Each party hereby irrevocably
submits to the exclusive jurisdiction of the Court of Chancery and any appellate court therefrom within the State of Delaware,
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. 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. 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 HEREWITH OR ARISING OUT OF
THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

8.6             
Counterparts. This Agreement may be executed in counterparts, each of which
shall be an original, but all of which shall constitute one document.

 

8.7             
Entire Agreement. This Agreement constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes any prior written or oral understandings and/or agreements between
them with respect thereto.

 

8.8             
Headings; Etc. The headings herein are inserted for convenience of reference
only and are to be ignored in any construction of the provisions hereof. Any references in this Agreement to a “Section”
or “Exhibit” shall refer to a Section or Exhibit of this Agreement unless otherwise specified.

 

8.9             
Survival. The representations, warranties and covenants contained herein or
made pursuant hereto shall survive the execution and delivery of this Agreement and the closing of any redemption or purchase
and sale pursuant to an exercise of Redemption Rights hereunder.

 

8.10         
Further Assurances. Each of the parties shall hereafter execute and deliver
such other instruments and documents and do such further acts and things as may be required or useful to carry out the purposes
of this Agreement.

 

 

 

** REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK **

 

     

     

    

 

 

IN WITNESS WHEREOF,
the parties have executed this Agreement on the Effective Date.

 

 

THE COMPANY:

 

FTE NETWORKS, INC.

 

By: /s/ Michael Palleschi

Name: Michael Palleschi

Title: Chief Executive Officer

 

 

LATERAL PARTIES:

 

LATERAL JUSCOM FEEDER LLC

By: Lateral Global Investors,
LLC, its Manager

 

 

By: /s/ Richard 

Name:

Title:

 

LATERAL FTE FEEDER LLC

By: Lateral Global Investors,
LLC, its Manager

 

 

By:_______________________

Name:

Title:

 

 

 

 

 

 

Signature
Page to Redemption Rights Agreement

 

     

     

    

 

EXHIBIT A

 

Notice of Redemption

 

The undersigned hereby
irrevocably (i) exercises its Redemption Rights as to the number of Redeemable Shares in FTE Networks, Inc. (the “Company”)
set forth on the signature page hereto in accordance with the terms of that certain Redemption Rights Agreement, dated October
___, 2015 (the “Agreement”), by and between Lateral Juscom Feeder LLC, Lateral FTE Feeder LLC, and the Company,
(ii) transfers and surrenders such Redeemable Shares and all right, title and interest of the undersigned therein to the Company,
that shall purchase or redeem such Redeemable Shares pursuant to the Agreement, and (iii) directs that the Redemption Price payable
upon exercise of the Redemption Rights be delivered to the address specified below. Attached hereto are the certificates, if any,
representing the Redeemable Shares.

 

The undersigned hereby
represents, warrants, certifies and agrees (i) that the undersigned has good and marketable title to such Redeemable Shares, free
and clear of all Liens, (ii) that the undersigned has the full right, power and authority to transfer and surrender the Redeemable
Shares as provided herein and such transfer and surrender has been authorized by all necessary action, and (iii) that the undersigned
has obtained the consent or approval of all persons or entities, if any, having the right to consent to or approve such transfer
and surrender.

 

Exhibit
A to Redemption Rights Agreement

 

     

     

    

 

Capitalized terms used
but not defined herein shall have the meanings set forth in the Agreement.

 

Dated: ____________________

 

Number of Redeemable Shares to be redeemed:
__________________

 

 

 

_______________________________ 

 

By: ___________________________________

Its: ___________________________________

 

_______________________________________

(Street Address)

 

_______________________________________

(City, State, Zip Code)

 

 

     

     

    

 

Schedule 7

 

Capitalization

 

Except as described
below, there are no (a) options, warrants or other rights outstanding with respect to the capital stock or other securities of
the Company, (b) securities convertible into or exchangeable for shares of capital stock of the Company or (c) other commitments
of any kind for the issuance of additional shares of capital stock or options, warrants or other securities of the Company:

 

Employee Options:

 

Common Stock - 2,518,420
shares

 

Series F Convertible
Preferred Stock – 259,750 shares

 

Warrants:

Common Stock - 744,999
shares

 

 

 

Schedule
7: Capitalization

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