Document:

Blueprint

 

 

NON-SOLICITATION AND RIGHT OF FIRST REFUSAL AGREEMENT

 

This Non-Solicitation and Right of
First Refusal Agreement (the
“Agreement”),
dated as of May 4, 2018 (the “Effective
Date”), is made and
entered into by and between Fusion Connect, Inc.
(f/k/a Fusion Telecommunications
International, Inc.), a Delaware corporation
(“Fusion”),
and Lingo
Management, LLC, a Georgia
limited liability company (“Lingo”).
Fusion and Lingo are sometimes hereinafter referred to collectively
as the “Parties”
and individually as a “Party.” Capitalized terms used
in this Agreement and not otherwise defined shall have the meaning
assigned to each such term in the Merger Agreement (as defined
below).

 

WHEREAS, Fusion, Birch Communications Holdings,
Inc., a Georgia corporation (“BCHI”),
and Fusion BCHI Acquisition LLC, a Delaware limited liability
company, previously entered into that certain Merger Agreement,
dated as of August 25, 2017, as amended (the “Merger
Agreement”); and

 

WHEREAS, as a condition to closing the Merger,
BCHI was obligated to spin-off its Consumer/SMB
Business to BCHI Holding LLC, in accordance with the Merger
Agreement and as further agreed by the Fusion and BCHI (the
“Spin-Off”);
and

 

WHEREAS,
the Spin-Off was accomplished by BCHI through the formation of
Lingo, the transfer of certain assets (including the stock of
certain Subsidiaries of BCHI) to Lingo and the distribution of the
membership interests in Lingo to BCHI Holding LLC; and

 

WHEREAS,
the Parties acknowledge that the execution of this Agreement is a
condition precedent to the closing of the Merger.

 

NOW,
THEREFORE, in consideration of the covenants and mutual promises
and agreements contained in this Agreement, and other valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties agree as follows:

 

1.           

Non-Solicitation.

 

a.           For
a period of three (3) years from the Effective Date, each Party
agrees that it will not, either directly or indirectly (including
through its Affiliates (which, for purposes of this provision, does
not include Fusion and its Subsidiaries)) or as an agent on behalf
of, or in conjunction with any Person: (A) solicit for employment
or in any way induce or attempt to induce to leave the employ of,
or engagement by, the other Party, any individual who is, on the
date of the solicitation or attempted inducement, a director,
officer, employee or consultant to the other Party; or (B) induce
or attempt to induce any Person who is a director, officer,
employee or consultant to the other Party to leave the employ of,
or terminate or breach their respective agreements with, the other
Party, or in any other way deliberately interfere with the
relationship between the other Party and any such Person; provided,
however, that no general advertisement or general solicitation of
employment not targeted to the directors, officers, employees or
consultants of the other Party shall be deemed to be a solicitation
of such Persons in violation of this Section; and provided further
that the foregoing restrictions shall not apply to the hiring of
employees by a Party from the other Party as contemplated by the
terms of the Transition Services Agreement, date the date hereof,
by and between Fusion and Lingo.

 

 

 

 

b.          In
recognition of the various services to be performed by Lingo and
Fusion for each other pursuant to the Transition Services Agreement
of even date herewith, including the sharing of computer systems
that include customer records (the period of time during which such
sharing of systems and records continues being referred to herein
as the “Shared Records
Period”), each Party
agrees that it will not, either directly or indirectly (including
through Affiliates (provided, that for purposes of this Agreement,
Lingo and its Subsidiaries are not deemed to be Affiliates of
Fusion and its Subsidiaries)) or as an agent on behalf of, or in
conjunction with any Person, during the Specified Period (as
defined below), (A) solicit, attempt to solicit, or assist any
other Person in soliciting or attempting to solicit, any customer
of the other Party as of the date hereof or that is subsequently
acquired by the other Party after the date of this Agreement and
prior to the end of the Shared Records Period, or (B) take any
action to deliberately interfere with the relationship between the
other Party and any Person who is a lessor, licensor, customer,
supplier, licensee or other business associate or relation of the
other Party. As used hereinabove, Specified Period shall mean the
period ending 24 months after the end of the Shared Records Period,
but in no event ending later than the 3rd
anniversary of the Effective
Date.

 

2.           

Right of First
Refusal.

 

a.          Until
the sooner to occur of the 3rd
anniversary of the Effective Date, or
a Change of Control (defined below) as to Lingo, neither Lingo nor
any of its Subsidiaries shall enter into a binding agreement with
any third party that either owns or is the provider, either
directly or indirectly, of communications services (whether
regulated or unregulated) or cloud services, in each case to
business customers (each such Person, a “Third
Party”), relating to an
Acquisition without first offering Fusion the opportunity to effect
the Acquisition on the same economic terms as Lingo or its
Subsidiary, as the case may be, is prepared to effect that
Acquisition as reflected in a written letter of intent between
Lingo or its Subsidiary, as applicable, and that Third Party. The
offer to Fusion shall remain open for a period of twenty (20) days
from Lingo’s submission of a copy of the offer to Fusion (the
“Right of First Refusal
Period”). The offer to
Fusion shall set forth substantially all of the material terms of
the proposed Acquisition that would be included in a customary
letter of intent, including, but not limited to, price (including
any earnouts our other contingent consideration), whether payable
in cash or securities or other consideration, and whether the
transaction is structured as a tax free transaction and, such offer
shall be accompanied by a copy of any letter of intent signed by
Lingo or its Subsidiary with the Third Party and, if available, the
current draft of proposed agreement for the Acquisition. If, during
the Right of First Refusal Period, Fusion elects to proceed with
the Acquisition, for such election to be effective, it must include
a confirmation that such acquisition is permitted under is credit
facilities or that it has obtained an amendment or waiver in this
regard. Upon such an election, Lingo, or its Subsidiary, as
applicable, shall (i) advise the Third Party of Fusion’s
election, (ii) assign any existing letter of intent to Fusion,
(iii) provide Fusion with all applicable contact details for the
Third Party and its counsel, if known, and (iv) forward Fusion any
draft acquisition agreement. If, during the Right of First Refusal
Period, Fusion elects not to proceed with the Acquisition, or fails
to timely notify Lingo as to its election, Lingo or its Subsidiary,
as the case may be, may proceed with the Acquisition on terms
substantially consistent with the terms notified to Fusion. In the
event that Lingo or its Subsidiary subsequently negotiate terms
that are materially more beneficial to it than those previously
notified to Fusion, Lingo shall be obligated to reoffer the
opportunity to Fusion and the Right of First Refusal Period shall
commence once again. For purposes of this paragraph, the term
“Acquisition”
means any transaction in which Lingo or any of its Subsidiaries
will acquire, either directly or indirectly, all or substantially
all of the assets of a Third Party, whether by purchase of assets,
shares or other equity securities, or through a proposed merger or
similar transaction with such Third Party. A
“Change of
Control” as to Lingo
shall be deemed to have occurred should Holcombe T. Green, Jr. and
R. Kirby Godsey no longer own, directly or indirectly, at least a
majority of the equity interests of Lingo.

 

 

2

 

 

b.          In
the event that Lingo enters into an Acquisition permitted under
Section 3a, such acquired Third Party (an
“Acquired
Entity”) shall become
subject to the terms of this Agreement. Neither Lingo nor any of
its Affiliates shall disclose Confidential Information of Fusion or
its Subsidiaries to any Acquired Entity or its officers, directors,
employees, managers, agents or representatives who are not already
privy to such Confidential Information (without being in breach of
this Section 3b), or use any such Confidential Information to
compete with Fusion or its Subsidiaries or in a manner that is in
any way detrimental to Fusion or its Subsidiaries. For purposes of
this Agreement “Confidential Information” shall include
any financial, technical, sales, marketing, development, personnel,
and other confidential or proprietary information, records, or
data, however recorded or preserved, whether written or oral,
including, without limitation, customer lists, supplier lists,
trade secrets, designs, product formulations, product
specifications, and personnel information. Notwithstanding the
foregoing, “Confidential
Information” shall not
include information to the extent that the recipient thereof can
demonstrate: (i) was publicly known at the time of disclosure to
it, or has become publicly known through no act of the recipient in
breach of this Section 3b, or (ii) was rightfully received from a
third party without a duty of confidentiality.

 

3.            Authority
for Judicial Enforcement. The
Parties acknowledge and agree that the covenants of each Party set
forth above in paragraphs 1 through 4 are reasonable in geographic
and temporal scope and in all other respects, and (ii) have been
made in order to induce Fusion and BCHI to consummate the
transactions contemplated by the Merger Agreement, and that Fusion
and BCHI would not have consummated the transactions contemplated
by the Merger Agreement, but for such covenants. If, at any time of
enforcement of the provisions of paragraphs 1 through 3, a
Governmental Entity determines that the duration, scope or area
restrictions stated herein are not enforceable under applicable
Law, the Parties agree that the maximum duration, scope or area (as
applicable) permitted by applicable Law shall be substituted for
the duration, area or scope (as applicable) stated herein and the
Governmental Entity shall be authorized by the Parties to revise
the restrictions contained herein to cover such maximum duration,
area or scope.

 

4.            Remedies
Upon Breach. It is expressly
agreed by the Parties that monetary damages would be inadequate to
compensate a Party for a breach by the other Party of its covenants
and agreements in this Agreement. Accordingly, the Parties
acknowledge and agree that any such violation or threatened
violation will cause irreparable injury to the other and that, in
addition to any other remedies which may be available, such Party
shall be entitled to seek injunctive relief against any threatened
breach of this Agreement or the continuation of any such breach
without the necessity of providing actual damages and without
posting any bond or other security, and may seek to specifically
enforce the terms of this Agreement.

 

 

3

 

 

5.           Notices.
All notices, requests, consents, claims, demands, waivers and other
communications hereunder shall be in writing and shall be deemed to
have been given: (a) when delivered by hand (with written
confirmation of receipt); (b) when received by the addressee if
sent by a nationally recognized overnight courier; or (c) on the
third (3rd)
day after the date mailed, by certified or registered mail, return
receipt requested, postage prepaid. Such communications must be
sent to the respective Parties at the following addresses (or at
such other address for a Party as shall be specified in a notice
given in accordance with this section:

 

if
to Lingo:

 

Lingo
Management, LLC

3060
Peachtree Road NW, Suite 1065,

 

Atlanta,
GA 30305

Attention:
Holcombe T. Green, Jr.

 

if
to Fusion:

 

Fusion
Connect, Inc. (f/k/a Fusion Telecommunications International,
Inc.)

420
Lexington Avenue, Suite 1718

New
York, NY 10170

Attention:
General Counsel

 

6.           Assignability
and Binding Effect. Neither
Party may assign or otherwise transfer any of its rights or
obligations under this Agreement.

 

7.           Waivers/Remedies.
Failure of either Party to insist upon the strict compliance by the
other Party with any of the terms, covenants or conditions of this
Agreement shall not be construed as a waiver of any subsequent
breach. The election by either Party of any right or remedy
contained in this Agreement is not exclusive of any other rights or
remedies at law or in equity other than as may be limited
explicitly in this Agreement.

 

8.           Severability.
The provisions of this Agreement are severable. If any provision of
this Agreement is held, by a court of competent jurisdiction, to be
invalid or unenforceable or to conflict with any federal, state or
local law, such portion or portions of this Agreement are hereby
declared to be of no force or effect in such jurisdiction, and this
Agreement shall otherwise remain in full force and effect and be
construed as if such portion had not been included. In the event
that any provision of this Agreement is held to be unenforceable
for being unduly broad as written, such provision shall be deemed
amended to narrow its application to the extent necessary to make
the provision enforceable according to applicable law and shall be
enforced as amended to the maximum legal and equitable
extent.

 

 

4

 

 

9.           Entire
Agreement. This Agreement is
the entire agreement between the Parties with respect to the
subject matter hereof and this Agreement supersedes and replaces
any and all prior and contemporaneous agreements, representations,
promises or understandings of any kind between the Parties with
respect thereto. No modification, amendment or waiver of any of the
provisions of this Agreement shall be effective unless in writing
and signed by both Parties.

 

 

10.           Interpretation
of Agreement. The Parties
acknowledge and agree that (1) this Agreement and its reduction to
final written form are the result of good faith negotiations
between the Parties through their respective counsel; (ii) said
counsel have carefully reviewed and examined this Agreement before
execution by said Parties; and (iii) any statute or rule of
construction that ambiguities are to be resolved against the
drafting party shall not be employed in the interpretation of this
Agreement.

 

11.           Governing
Law/Waiver of Trial By Jury Venue. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of
New York without regard to its conflict of law principles. Each
Party hereby voluntarily and irrevocably waives trial by jury in
any action or other proceeding brought in connection with this
Agreement.

 

12.           Counterparts/Electronic
Signatures. This Agreement may
be executed in one or more counterparts with the same effect as if
both Parties had signed the same document. Each counterpart shall
be construed together and shall constitute one and the same
Agreement. Electronic signatures shall have the same force and
effect as originals, for all purposes.

 

13.           Third
Party Beneficiaries. None of
the provisions of this Agreement is for the benefit of, or
enforceable by, any third-party beneficiary.

 

14.           Further
Assurances. The Parties agree
to give such further assurances and to execute such documents as
may be necessary to correct, confirm and effectuate the intent and
purpose of this Agreement.

 

15.           Headings.
The captions of the paragraphs of this Agreement are for
convenience only and shall not be considered or referenced in
resolving questions of construction or
interpretation.

 

[signatures appear on the following page]

 

 

 

5

 

 

IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the
Effective Date.

 

FUSION
CONNECT, INC.

 

 

By: 
/s/ James P. Prenetta,
Jr. 

Name:
James P. Prenetta, Jr.

Title:
Executive Vice President and General Counsel

 

 

LINGO
MANAGEMENT, LLC

 

 

By: 
/s/ Gordon P. Williams,
Jr. 

Name:
Gordon P. Williams, Jr.

Title:
Manager

 

 

 

 

 

 

 

 

 

[Lingo
Non-Solicitation Agreement]Blueprint

 

MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

 

by and among

 

 

FUSION TELECOMMUNICATIONS INTERNATIONAL INC.

 

(“Seller”)

 

 

and

 

 

XCOMIP LLC

 

(“Purchaser”)

 

 

and

 

 

FUSION GLOBAL SERVICES LLC

 

(the “Company”)

 

 

 

 

 

dated as of May 4, 2018

 

 

-1-

 

 

MEMBERSHIP INTEREST PURCHASE AND SALE AGREEMENT

 

 

THIS MEMBERSHIP INTEREST PURCHASE AND SALE
AGREEMENT (this “Agreement”)
is made and entered into as of this 4th day of May 2018 (the
“Effective
Date”) by and between Fusion Telecommunications International,
Inc. (to be renamed Fusion Connect, Inc.), a corporation formed under the laws of
the state of Delaware (the “Seller”),
XcomIP LLC, a limited
liability company formed under the laws of the state of Delaware
(the “Purchaser”),
and Fusion Global Services
LLC, a limited liability company formed under the laws of
the state of Delaware (the “Company”).
Seller, Purchaser and the Company are sometimes hereinafter
referred to individually as a “Party”
and collectively as the “Parties.”
Capitalized terms used herein and not otherwise defined have the
meanings set forth in Section One hereof.

 

RECITALS

 

 

A.           Seller
currently owns sixty percent (60%) of the issued and outstanding
Membership Interests (the “Fusion Membership
Interests”) in the Company;

 

B.           Purchaser
currently owns forty percent (40%) of the issued and outstanding
Membership Interests in the Company; and

 

C.           Seller
wishes to sell to Purchaser, and Purchaser wishes to purchase from
Seller, the Fusion Membership Interests pursuant to the terms and
conditions set forth herein.

 

NOW, THEREFORE, in consideration of the
covenants, agreements, representations and warranties contained
herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties agree
as follows:

 

ARTICLE ONE

DEFINITIONS

 

As used
in this Agreement, the following terms shall have the meaning set
forth after each such term.

 

1.1 “Additional Purchase Price
Consideration” has the meaning set forth in Section
2.2.

 

1.2 “Affiliate” means with
respect to any Person, any other Person that is controlling,
controlled by, or under common control with (directly or indirectly
through any Person) the Person referred to. The term
“control”
(including, with correlative meaning, the terms “controlled
by” and “under common
control with”) as used with respect to any Person,
means the possession, directly or indirectly, of fifty one (51%)
percent or more of the voting power to direct or cause the
direction of the management and policies of such
Person.

 

1.3

Agreement” has the
meaning set forth in the preamble.

 

 

 

-2-

 

 

1.4 
“Business Day” means any
day except Saturday, Sunday or any other day on which commercial
banks located in New York, New York are authorized or required by
Law to be closed for business.

 

1.5 
“Capital Securities” means
(a) as to any Person that is a company or corporation, the
authorized shares of such Person’s capital securities,
including all classes of common, preferred, voting and nonvoting
capital securities, and, as to any Person that is not a corporation
or an individual, the ownership or membership interests in such
Person, including, without limitation, the right to share in
profits and losses, the right to receive distributions of cash and
property, and the right to receive allocations of items of income,
gain, loss, deduction and credit and similar items from such
Person, whether or not such interests include voting or similar
rights entitling the holder thereof to exercise control over such
Person, and (b) warrants, options or other securities, evidences of
indebtedness or other obligations of a Person that are, directly or
indirectly, convertible into or exercisable or exchangeable for
securities of or other interest in such Person as described in
clause (a) of this definition.

 

1.6           “Certificate
of Amendment” has the meaning set forth in
Section
4.2.

 

1.7           “Closing”
means the closing of the purchase of the Fusion Membership
Interests by the Purchaser, which shall occur simultaneously upon
the execution of this Agreement and the Amended and Restated
Secured Promissory Note (the “Note”) of even date
hereof issued by the Company to the Seller.

 

1.8           “Closing
Date” means the date of the Closing.

 

1.9           “Company”
has the meaning given such term in Preamble.

 

1.10        
“Effective
Date” has the meaning specified in the
Preamble.

 

1.11        
“ERISA”
means the Employees Retirement Income Security Act of
1974.

 

1.12        
“Fusion Membership
Interests” has the meaning given such term in
Recital
A.

 

1.13        
“Governmental
Entity” means any court, arbitrator, administrative or
other governmental department, agency, commission, authority or
instrumentality, domestic or foreign.

 

1.14        
“Initial Purchase
Price” has the meaning set forth in Section 2.2.

 

1.15        
“Law”
means any applicable federal, state, local or foreign law, statute,
ordinance, rule, regulation, judgment, order, injunction, decree or
agency requirement of any Governmental Entity.

 

1.16        
“Lien”
means any security interest, mortgage, pledge, hypothecation,
charge, claim, option, right to acquire, adverse interest,
encumbrance, restriction, lien (statutory or other), or preference,
priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or
other title retention agreement, any financing lease involving
substantially the same economic effect as any of the foregoing, and
the filing of any financing statement under the Uniform Commercial
Code or comparable Law of any jurisdiction).

 

 

-3-

 

 

1.17           “Material
Adverse Effect” means any event reasonably expected to
(i) result in a material adverse effect on the properties,
business, results of operations, condition (financial or
otherwise), or affairs of the Company, or (ii) in any manner, draw
into question the validity of this Agreement.

 

1.18           
“Member” or
“Members” mean the holders
of any Membership Interests.

 

1.19           “Membership
Interests” means the common membership interests of
the Company and all other securities of the Company that may be
exchangeable for, convertible into or issued in exchange for or in
respect of the membership interest (combination, reclassification,
reorganization or any other means).

 

1.20           “Net
Profits” means the net positive income as reflected in
the Company’s annual statements (i.e. gross revenue minus
salaries, expenses, cost of sales, all operating costs, and minus
any distributions previously made in any given year) as reflected
in information delivered to Seller in accordance with Section
6.3(d), minus excess cash required as working capital for
Company’s ongoing operations as determined by Company’s
Manager.

 

1.21           “New
Membership Interests” means (a) any Capital Securities
of the Company or any Subsidiary issued after the date hereof, (b)
Capital Securities of the Company or any Subsidiary issued to the
manager or other officers or employees of, or other service
providers to, the Company or the Subsidiaries pursuant to any form
of incentive compensation plan authorized by the Members, (c)
Capital Securities of the Company or any Subsidiary issued in
connection with a split, dividend or the like, (d) Capital
Securities of the Company or any Subsidiary issued in conjunction
with equipment financing or debt financing authorized by the
Members, (e) Capital Securities of the Company or any Subsidiary
issued in connection with acquisitions of the Capital Securities or
assets of other entities, including, without limitation, by way of
merger, consolidation or purchase authorized by the Members, (f)
Capital Securities of a Subsidiary issued by such Subsidiary to the
Company or any other Subsidiary, (g) Capital Securities of the
Company or any Subsidiary issued in connection with any strategic
alliance, joint venture or similar arrangement authorized by the
Members, and (h) Capital Securities of the Company or any
Subsidiary subsequently issued on conversion, exercise or exchange
of those Capital Securities.

 

1.22           “Person”
includes any individual, company, corporation, association,
partnership (general or limited), joint venture, trust, estate,
limited liability company, or other legal entity or organization,
including any governmental entity

 

1.23           “Plan”
or “Plans” means any plan or
arrangements of the Company which constitutes an “employee
benefit plan,” as defined in Section 3 (3) of
ERISA.

 

1.24           “Proceeding”
has the meaning provided in Section 9.8(b).

 

1.25           “Purchase
Price” has the meaning set forth in Section 2.2.

 

1.26           “Subsidiary”
or “Subsidiaries” means as of
any time any Person of which Company at such time owns, directly or
indirectly, at least a majority of the outstanding Capital
Securities of such Person entitled to vote on matters involving
such Person.

 

 

-4-

 

 

ARTICLE II

PURCHASE/SALE OF THE FUSION MEMBERSHIP INTERESTS

 

Section
2.1. Purchase and Sale of
Fusion Membership Interests. At the Closing, the Seller will
sell, convey, transfer and deliver to the Purchaser, and the
Purchaser will purchase and receive from the Seller the Fusion
Membership Interests, which Membership Interests shall represent
all of the issued and outstanding Membership Interests in the
Company owned by the Seller as of Closing.

 

Section
2.2. Purchase
Price. At the Closing, the Purchaser shall pay the Seller,
in cash, the sum of One US Dollar (US$1.00) for the Fusion
Membership Interests (the “Initial Purchase
Price”). In addition, Purchaser agrees to pay Seller
the following: (i) sixty percent (60%) of the Net Profits of the
Company; (ii) sixty percent (60%) of any distributions being made
by the Company to its Members only to the extent such amounts are
not distributed as part of the distribution of Net Profits set
forth in (i); and (iii) sixty percent (60%) of the net proceeds
received by the Members from a sale of the Company to a third party
(collectively, the “Additional Purchase
Price Consideration” and together with the Initial
Purchase Price, collectively, the “Purchase
Price”). Purchaser agrees to remit each payment of
Additional Purchase Price Consideration as follows: (a) any
payments made pursuant to (ii) above shall be made to the Seller
within fifteen (15) calendar days following the applicable event;
and (b) any payments made pursuant to (iii) above shall be made to
the Seller within thirty (30) calendar days of receipt of the net
proceeds received by Purchaser. In the case of amounts to be
remitted under (i) above, the Company agrees to remit the required
amount to Seller on no less than an annual basis within thirty (30)
days of the end of the fiscal year, and may, in its sole
discretion, remit such payments on a quarterly basis during the
relevant year. Failure to remit payments due under this Section 2.2
within the required period shall be deemed a material breach of
this Agreement.

 

Section
2.3 Net Loss
Recapture. It is expressly understood by the Parties hereto
that at the end of each fiscal year the distribution of Net Profits
set forth above shall take into account the prior year’s
profits and losses to determine the current year’s
distribution amount. For example, Year 1, the Company has losses of
$5,000.00; Year 2, the Company has net income of $8,000.00; the
distribution of Net Profits would be based upon an overall gain of
$3,000.00 for Year 2.

 

Section
2.4   Adjustments to Additional Purchase
Price Consideration Percentages. In the event of a sale of
Membership Interests in accordance with Section 7.4(iii), the
Additional Purchase Price Consideration to which Seller shall be
entitled to receive shall be appropriately adjusted downward on a
pro rata basis to give effect to each such sale.

 

 

 

-5-

 

 

ARTICLE III

REPRESENTATIONS AND WARRANTIES

 

Section
3.1 Representations and
Warranties of the Seller. The Seller represents and warrants
to the Purchaser that:

 

3.1.1
Due Incorporation/Good
Standing. The Seller has been duly organized, and is validly
existing and is in good standing under the Laws of the state of
Delaware.

 

3.1.2
Power and
Authority. Seller has all requisite corporate power and
corporate authority to execute, deliver, and perform its
obligations under this Agreement and to consummate the transactions
contemplated hereby and thereby.

 

3.1.3
Membership
Interests. Seller owns the Fusion Membership Interests and
at the Closing the Fusion Membership Interests will be free and
clear of all Liens.

 

3.1.4
Validity of
Agreement. This Agreement has been duly and validly
authorized, executed, and delivered by the Seller and constitutes a
valid and legally binding agreement of the Seller, enforceable
against it in accordance with its terms, except as such
enforceability may be limited by general equitable principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at Law) and, as to rights of
indemnification, by principles of public policy or federal or state
securities Laws relating thereto.

 

3.1.5
No Conflict. The
execution, delivery, and performance of this Agreement by the
Seller and the consummation of the transactions contemplated hereby
will not violate, conflict with, or result in a breach or violation
of the organizational documents of Seller or any of the terms or
provisions thereof, or constitute a default or cause an
acceleration of any obligation under, or result in the imposition
or creation of (or the obligation to create or impose) a Lien with
respect to the organizational documents of the Seller; any bond,
note, debenture, or other evidence of indebtedness or any
indenture, mortgage, deed of trust, or other agreement or
instrument to which Seller is a party or by which it is bound, or
to which any properties of the Seller is or may be subject; or
contravene any order of any court or governmental agency or body
having jurisdiction over the Seller or any of its properties; or
violate or conflict with any statute, rule or regulation, or
administrative or court decree applicable to the Seller or any of
its properties; except for any such violations, conflicts,
breaches, or defaults which, singularly or in the aggregate, would
not reasonably be expected to result in a Material Adverse
Effect.

 

3.1.6
No Broker. Seller
has not incurred any liability for finder’s, agent’s or
brokerage fees, commissions or compensation in connection with this
Agreement or the transactions contemplated hereby.

 

3.2 
Representations and
Warranties of the Purchaser. The Purchaser represents and
warrants to Seller that:

 

 

-6-

 

 

3.2.1 
Due Incorporation/Good
Standing. The Purchaser has been duly formed, is validly
existing as a limited liability company and is in good standing
under the Laws of the state of Delaware.

 

3.2.2 
Power and
Authority. The Purchaser has all requisite corporate power
and corporate authority to execute, deliver, and perform its
obligations under this Agreement and to consummate the transactions
contemplated hereby.

 

3.2.3 
Validity of
Agreement. This Agreement has been duly and validly
authorized, executed, and delivered by the Purchaser and
constitutes a valid and legally binding agreement of the Purchaser,
enforceable against it in accordance with its terms, except as such
enforceability may be limited by general equitable principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at Law) and, as to rights of
indemnification, by principles of public policy or federal or state
securities Laws relating thereto.

 

3.2.4 
No Conflict. The
execution, delivery, and performance of this Agreement by the
Purchaser and the consummation of the transactions contemplated
hereby and thereby will not violate, conflict with, or result in a
breach or violation of the organizational documents of the
Purchaser or any of the terms or provisions thereof, or constitute
a default or cause an acceleration of any obligation under, or
result in the imposition or creation of (or the obligation to
create or impose) a Lien with respect to the organizational
documents of the Seller; any bond, note, debenture, or other
evidence of indebtedness or any indenture, mortgage, deed of trust,
or other agreement or instrument to which the Purchaser is a party
or by which it is bound, or to which any properties of the
Purchaser is or may be subject; or contravene any order of any
court or governmental agency or body having jurisdiction over the
Purchaser or any of its properties; or violate or conflict with any
statute, rule or regulation, or administrative or court decree
applicable to the Purchaser or any of its properties; except for
any such violations, conflicts, breaches, or defaults which,
singularly or in the aggregate, would not reasonably be expected to
result in a Material Adverse Effect.

 

3.2.5 
Investment Intent.
The Purchaser is acquiring the Fusion Membership Interests for its
own account and not with a view to the distribution of those
interests within the meaning of Section 2(11) of the Securities Act
of 1933, as amended.

 

3.2.6 
No Broker.
Purchaser has not incurred any liability for finder’s,
agent’s or brokerage fees, commissions or compensation in
connection with this Agreement or the transactions contemplated
hereby.

 

3.3    
Representations and
Warranties of the Company. The Company represents and
warrants to the Seller and Purchaser that:

 

3.3.1 
Due Incorporation/Good
Standing. The Company has been duly formed, is validly
existing as a limited liability company and is in good standing
under the Laws of the state of Delaware.

 

3.3.2 
Power and
Authority. The Company has all requisite limited liability
power and authority to execute, deliver, and perform its
obligations under this Agreement and to consummate the transactions
contemplated hereby.

 

 

-7-

 

 

3.3.3 
Validity of
Agreement. This Agreement has been duly and validly
authorized, executed, and delivered by the Company and constitutes
a valid and legally binding agreement of the Company, enforceable
against it in accordance with its terms, except as such
enforceability may be limited by general equitable principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at Law) and, as to rights of
indemnification, by principles of public policy or federal or state
securities Laws relating thereto.

 

3.3.4 
No Conflict. The
execution, delivery, and performance of this Agreement by the
Company and the consummation of the transactions contemplated
hereby will not violate, conflict with, or result in a breach or
violation of the certificate of formation or operating agreement of
the Company or any of the terms or provisions thereof, or
constitute a default or cause an acceleration of any obligation
under, or result in the imposition or creation of (or the
obligation to create or impose) a Lien with respect to its
certificate of formation or operating agreement or any bond, note,
debenture, or other evidence of indebtedness or any indenture,
mortgage, deed of trust, or other agreement or instrument to which
the Company is a party or by which it is bound, or to which any
properties of the Company is or may be subject; or contravene any
order of any court or governmental agency or body having
jurisdiction over the Company or any of its properties; or violate
or conflict with any statute, rule or regulation, or administrative
or court decree applicable to the Company or any of its properties;
except for any such violations, conflicts, breaches, or defaults
which, singularly or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect.

 

 

Section
3.4   Survival
of Representation and Warranties. The representation and
warranties given by the Purchaser, the Seller and the Company do
not survive the Closing.

 

 

ARTICLE IV

CLOSING DELIVERIES OF SELLER

 

Section
4.1.  At Closing, the Seller shall deliver to Purchaser the
following:

 

(a)           the
Fusion Membership Interests, duly endorsed for transfer to
Purchaser, or if uncertificated, an assignment of the Fusion
Membership Interests in form and substance reasonably satisfactory
to Purchaser;

 

(b)           a
certificate of the Seller (i) listing the officers of Seller
authorized to execute this Agreement and any documents contemplated
by this Agreement, and (ii) confirming that, as of the Closing,
Seller has duly performed each applicable covenant set forth
herein, and that all of Seller’s representations and
warranties herein are true and correct as of the
Closing;

 

(c)           a
copy of the Non-Solicitation Agreement attached hereto as
Exhibit
A executed by the Seller; and

 

(d)           such
other documents as may reasonably be requested by the
Purchaser.

 

 

-8-

 

 

ARTICLE V

CLOSING DELIVERIES OF PURCHASER

 

Section
5.1.   At Closing, the Purchaser shall deliver to the
Seller the following:

 

(a)           a
certificate of the Purchaser (i) listing the officers/manager of
Purchaser authorized to execute this Agreement and any documents
contemplated by this Agreement, and (ii) confirming that, as of the
Closing, the Purchaser has duly performed each applicable covenant
set forth herein, and that all of Purchaser’s representations
and warranties herein are true and correct as of the
Closing;

 

(b)           a
copy of Exhibit A
hereto duly executed and delivered by Fusion Global Services, LLC
and XcomIP, LLC;

 

(c)           a
duly authorized, executed and signed Note; and

 

(d)           such
other documents as may reasonably be requested by the
Seller.

 

ARTICLE VI

POST-CLOING COVENANTS

 

Section
6.1.   Further
Assurances; Access to Information. Each Party agrees to
execute and deliver any and all further agreements, documents or
instruments reasonably necessary or convenient to effectuate this
Agreement and the transactions referred to herein or contemplated
hereby or reasonably requested by the another Party to perfect or
evidence its rights hereunder. Each Party will promptly notify the
other Parties of any information delivered to, or obtained by, such
Party which would prevent the consummation of the transactions
contemplated by this Agreement, or would indicate a breach of the
representations or warranties of any of the Parties or as to which
any Party intends to seek indemnity under any of the terms of this
Agreement.

 

Section
6.2. Delivery of Minutes;
Execution and Delivery of the Certificate of Amendment to the
Company’s Certificate of Formation; Use of Fusion
Name. Within thirty (30) days of the date hereof, the
Purchaser shall deliver to the Seller (i) resolutions adopted by
the Members and manager (if required) authorizing the Company to
change its name from Fusion Global Services LLC to a name selected
by the Manager that does not include the name “Fusion”
(the “Certificate of
Amendment”), and (ii) execute and deliver to Seller,
for filing by Seller, the Certificate of Amendment, substantially
in the form of Exhibit B
hereto with the Secretary of State of the State of Delaware, which
Certificate of Amendment will be filed by Seller at its expense and
confirmation of such name change shall be promptly sent to Company
and Purchaser. Within sixty (60) days of the date of this
Agreement, the Company shall cease using any marketing materials
that reference the “Fusion” name and/or logo and within
twelve (12) months from the date of this Agreement shall have used
reasonable efforts to amend all existing contracts (both customer
and vendor) to reflect the new name of the Company and provided its
customers and vendors with written notice of such name
change.

 

 

-9-

 

 

 

Section
6.3 Information
Rights. The Purchaser agrees to cause the Company to provide
each of the Seller’s Chief Executive Officer and President
(at their respective offices) with the following, and such being
provided for informational purposes only:

 

(a) Annual Statements. Within one
hundred and twenty (120) days after the close of each
fiscal year of the Company, commencing with the fiscal year ending
on December 31, 2018, the Company will deliver to the Seller
internally prepared (unaudited) financial statements of the Company
and any consolidated Subsidiaries, including without limitation
unaudited consolidated balance sheets and statements of income and
retained earnings and of cash flows of the Company and its
Subsidiaries and any related materials, which annual financial
statements shall show the financial condition of the Company and
any consolidated Subsidiaries as of the close of such fiscal year
and the results of the Company’s operations during such
fiscal year. 

 

(b) Quarterly Statements. Within
forty-five (45) days after the end of each fiscal quarter, the
Company will deliver to the Seller an unaudited consolidated and
consolidating balance sheet of the Company and any consolidated
Subsidiaries and the related consolidated and consolidating
statements of income, retained earnings and cash flows for such
fiscal quarter and for the portion of the Company’s fiscal
year ended as of such fiscal quarter, setting forth in comparative
form, the figures for the corresponding fiscal quarter of the prior
year (if any), the corresponding portion of the Company’s
previous fiscal year and the Company’s budget for the current
fiscal year.

 

(c) Monthly Statements. Within
thirty (30) days after the end of each month, the Company will use
reasonable efforts to deliver to the Seller a management report of
the Company and any consolidated subsidiaries, including profit and
loss reports and statements of outstanding intercompany
indebtedness, however, any failure to do so within the time set
forth herein shall not be considered a material breach of this
Agreement.

 

(d) Budget; Other Information. As
soon as available but in any event no later than thirty (30) days
after the end of the prior fiscal year, the Company shall deliver
to the Seller a projected income statement for the Company and any
consolidated Subsidiaries for the upcoming fiscal year on a
quarter-by-quarter basis that has been approved by a majority of
the Membership Interest.

 

(e) Member and Manager Written Consents;
Meeting Minutes. Within thirty (30) calendar days following
the adoption of a written consent of the Members or the Manager of
the Company, the Company shall provide via email a copy of that
written consent to the Seller. In addition, within thirty (30)
calendar days following the occurrence of a meeting of the Members,
a copy of any meeting minutes generated as a result of such meeting
shall also be provided to the Seller via email.

 

Section
6.4. Approval
Requirements. As
a significant inducement to Seller entering into this Agreement and
selling the Fusion Membership Interests to the Purchaser, the
Purchaser and the Company agree that the Company may not take any
of the following actions without the prior written consent of the
Seller:

 

 

-10-

 

 

(i)      replace
Yehuda “Jay” Adams as the sole Manager;

 

(ii)   
increase the salary, bonus or other compensation paid to the
Manager, except that the Manager’s salary may be increased to
$300,000.00 as of the Effective Date of this Agreement and may be
increased on an annual basis thereafter by two percent (2%)
annually, after the Note is paid back in full and so long as the
Company is profitable (profitability to be measured by net profit
of the Company at the end of the prior fiscal year of the
Company).

 

(iii)  
until such time as the Company has paid the Note in full, issue any
New Membership Interests that would constitute more that fifteen
percent (15%) of the Membership Interests outstanding on the date
of this Agreement (it being expressly understood that any sale of all or substantially all of the
Company’s Membership Interests, subject to Section 6.9
herein, that results in Company receiving net proceeds that allow
for the full repayment of the outstanding balance due under the
Note is permitted at any time without Seller’s
consent);

 

(iv)

 
  comingle its assets with those of a Member, or hold any
assets in a name other than its own; or

 

(v)   fail to
maintain its books and records accurately and separate from those
of its Members.

 

 

Section
6.5  Observer Rights;
General Rights to Interact with Manager. The Company and the
Purchaser each agree that the Seller shall have the right to
advance written notice of, and the right to send a representative
to attend and observe, each meeting of its Members; Seller to bear
the costs of attending any such meeting(s). Notice of each such
meeting must be provided by the Company at least five (5) Business
Days prior to the scheduled meeting date. The Seller’s
initial representative shall be Gordon Hutchins, Jr. The Seller may
appoint a replacement representative at any time and from time to
time, but shall provide the Company with written notice of any
change in its designated representative, and such designated
representative shall be subject to Company’s reasonable
consent and not a familial relation of Manager. The Company also
agrees that the Seller’s representative shall have the right
to regularly communicate with the Manager either by phone or
through in person meetings in order to obtain regular updates
regarding the Company’s business activities and the Company
agrees to cause the Manager to engage in these regular
communications. So long as Mr. Hutchins is employed by Seller,
Seller agrees to make Mr. Hutchins available to the Company from
time to time to provide consultation and/or business advice. These
services will be provided by Mr. Hutchins at no cost to the
Company.

 

Section
6.6 Right of
Transfer. Notwithstanding any other provision in this
Agreement to the contrary, the Purchaser, as a Member of the
Company, may transfer all or any portion of the Membership
Interests acquired from the Seller hereunder to any partnership,
corporation, limited liability company, Affiliate, or other entity
in which the Purchaser owns a controlling interest.

 

 

-11-

 

 

Section
6.7  Non-Solicitation. As partial
consideration for the transfer of the Fusion Membership Interests
and as a material inducement to the Seller and Purchaser to
consummate the transactions contemplated hereby, the Seller, the
Purchaser and the Company will enter into a non-solicitation
agreement in the form attached hereto as Exhibit
A.

 

Section
6.8  Working Capital
Adjustment. Within
thirty (30) days following the execution of this Agreement by the
Parties, the Parties agree to complete the working capital analysis
contemplated by Section 6 of that certain Members Agreement, dated
as of September 1, 2017, by and among the Seller, the Company (the
“Members
Agreement”) and, within five (5) Business Days
following the completion of that analysis, for the
“owing” Party to make any required payment to the other
Party in cash. In the event the Parties are unable to agree on the
amount of the working capital adjustment, if any is required, the
Parties shall submit the matter to an independent accounting firm
or other qualified valuation firm, mutually agreed upon by the
Parties, for a final decision to be rendered within ten (10)
Business Days following retention of such accounting or valuation
firm. In the event that any monies required to be paid under this
Section are not timely paid, then if Purchaser is the owing Party
the Seller may add any amounts owed it to the principal under the
Note; and if Seller is the owing Party, then the Seller shall
deduct the amount so owed by it from the principal amount
outstanding under the Note.

 

Section
6.9. Right of First
Refusal. In the event of a proposed sale of the Company to
an unaffiliated bona fide third party purchaser, whether such sale
is accomplished through the sale of all or substantially all of the
Company’s assets, all of the Company’s Membership
Interests or through the merger of the Company with another entity,
the Seller shall have a right of first refusal to timely complete
that transaction on the same terms offered by the bona fide
purchaser. The Company must provide Seller with written notice of
the proposed transaction and must include with that notice a copy
of the proposed offer and a draft of any negotiated agreement with
respect to that transaction. Seller shall have ten (10) Business
Days from the date of receipt of the proposed offer to determine
whether it wishes to exercise this right of first refusal. Should
Seller not respond within the required ten-day period, then the
Purchaser and the Company may proceed with the proposed transaction
on the terms indicated. In the event there is any material change
in the offer received by the Company and Purchaser then the
Purchaser must reoffer the opportunity to Seller and the above
procedures shall apply once again. In addition, in the event the
Members of the Company decide to voluntarily dissolve or otherwise
winddown the Company, within five (5) Business Days of any such
decision the Members of the Company shall offer Seller the right to
take over ownership of Company and to continue to operate the
Company as a going concern. The Seller shall have five (5) Business
Days of receipt of written notice of such a decision by the Members
to determine whether it wishes to assume the operation of the
Company and take over the Members interests therein.

 

Section 6.10  Use of
Switch.
The Company shall have the right to continue to
use the Switches (as defined in that certain Asset Contribution
Agreement, dated as of the 20th
day of July, 2017 by and between the
Seller and the Company) and associated billing systems, free of
charge, so long as customers of the Company continue to be serviced
through the Switches but in no event for a period of more twelve
(12) months from the date of this Agreement.

 

 

-12-

 

 

Section 6.11  Additional Profit
Share.  The Company and
Purchaser agree that the terms of this Agreement only pertain to
the Company’s engagement in the wholesale carrier business
(the “Business”). 
Should the Purchaser choose to enter the cellular business or any
other communications or technology business, it may do so through
the Company, an Affiliate of the Company, or an independent entity
controlled by the Manager (the “New
Business”).  In such
event and only if the New Business uses any equipment, software, or
personnel (other than the Manager, who may engage in other business
activities other than the Business) of the Company, then
Purchaser’s sole obligation will be to remit fifty (50%)
percent of the Net Profits of any such New Business to Seller on an
annual basis within thirty (30) days of the end of the fiscal
year.

 

Section 6.12  Seller
Support. In recognition of the
on-going profit share arrangement contemplated by this Agreement,
Seller agrees to provide the Manager and other senior level
personnel of the Company, as well as the manager and senior level
personnel of any New Business, with reasonable access to Matthew D.
Rosen, Gordon Hutchins and James P. Prenetta (for so long as such
individuals are employed by the Seller), for the purpose of seeking
general business advice and in the case of Mr. Prenetta, general
legal advice and counsel, In addition, the Seller agrees to provide
access to, and use of, one office and the conference room (on an as
available basis) at the Seller’s office located at 420
Lexington Avenue, Suite 1718, New York New
York.

 

Section 6.13  Company
Services. To the extent that
Seller has future requirements as to any current or future services
offered by the Company or by any New Business (including, but not
limited to, cellular services), Seller agrees to provide the
Company with a reasonable opportunity to compete for the provision
of those services and agrees to provide management of the Company
with access to appropriate personnel at Seller to discuss and
understand Seller’s requirements and Seller further agrees to
provide the Company with due consideration during such procurement
process.

 

 

ARTICLE VII

MISCELLANEOUS

 

Section
7.1. Notices.

 

(a)           All
notices, requests, demands, waivers and other communications
required or permitted to be given under this Agreement shall be in
writing and shall be deemed to have been duly given (1) upon
personal delivery to the Party to be notified; (2) upon two (2)
Business Days when sent by email followed by certified or
registered mail; or (3) upon two (2) Business Days after being sent
by nationally recognized overnight carrier to the addresses below
as follows:

 

 

-13-

 

 

Notices to the
Purchaser:                

XcomIP,
LLC

Yehuda
“Jay” Adams

c/o
Meryl Ravitz

303
West 66th
Street, Suite 18BW

New
York, NY 10023

Email:
jay@xcomip.com

 

Notices to
Seller:              

Fusion
Telecommunications International, Inc.

Attn.:
General Counsel

420
Lexington Avenue, Suite 1718

New
York, NY 10170

E-mail:
legal@fusionconnect.com

 

Notices
to the
Company:                                               
Fusion Global Services LLC

             
Yehuda “Jay” Adams

             
c/o Meryl Ravitz

                                                       

             
303 West 66th
Street, Suite 18BW

         
    New York, NY 10023

       
                                                                               
E-mail: jay@xcomip.com

 

(b)           

Notwithstanding the
foregoing, notices to Purchaser and the Company (and required
copies thereof) may be contained in a single notice to all of them,
respectively.

 

(c)           

It is expressly
understood that the above addresses may change in the future and
each Party will provide the other Party with its updated address in
a timely manner.

 

Section
7.2.  Entire
Agreement. This Agreement constitutes the entire agreement
between the Parties with regard to the subject matter hereof, and
supersedes all prior agreements and understandings, oral and
written, between the Parties with respect to the subject matter
hereof except for the provisions, which, by their terms, survive
termination. In the event of any conflict between the terms of the
Members Agreement and this Agreement, the terms of this Agreement
shall prevail.

 

Section
7.3.  Amendments. Any amendment
hereof must be in writing. Any provision hereof may be waived in
writing by the Party entitled to the benefit of such provision. No
waiver of the breach of any provision shall be deemed or construed
to be a waiver of other or subsequent breaches. Nothing herein is
intended to confer any rights or remedies upon any Person not a
party hereto, except as expressly provided to the contrary
herein.

 

Section
7.4.  Delays and
Omissions; Waiver. No
delay or omission to exercise any right, power or remedy accruing
to either Party under this Agreement, upon any breach or default of
any other Party under this Agreement, shall impair any such right,
power or remedy of such non-breaching or non-defaulting Party nor
shall it be construed to be a waiver of any such breach or default,
or an acquiescence therein, or of or in any similar breach or
default thereafter occurring; nor shall any waiver of any single
breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or
approval of any kind or character on the part of either Party of
any breach or default under this Agreement, or any waiver on the
part of either Party of any provisions or conditions of this
Agreement, must be in writing and shall be effective only to the
extent specifically set forth in such writing. All remedies, either
under this Agreement or by Law or otherwise afforded to any Party,
shall be cumulative and not alternative.

 

 

-14-

 

 

Section
7.5. Severability.  The
provisions of this Agreement shall be deemed severable and the
invalidity, illegality or unenforceability of any provision shall
not affect the validity, legality or enforceability of the other
provisions hereof. Upon such determination that any term or other
provision of this Agreement is invalid, illegal or unenforceable,
the Parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the Parties as
closely as possible in a mutually acceptable manner in order that
the transactions contemplated hereby be consummated as originally
contemplated to the greatest extent possible.

 

Section
7.6. Successors;
Assignment. Neither this Agreement nor any of the rights,
benefits, or obligations hereunder may be assigned by any Party
(whether by operation of Law or otherwise) without the prior
written consent of the other Parties. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit
of, and be enforceable by a Party and their respective successors
and permitted assigns. Nothing herein, express or implied, is
intended to or shall confer upon any other Person any legal or
equitable right, benefit or remedy of any nature whatsoever under
or by reason of this Agreement.

 

Section
7.7. Counterparts; Email
Signatures. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, and all of which
together shall be deemed to be one and the same instrument. This
Agreement may be executed and delivered by email
signature.

 

Section
7.8.  Choice of Law
and Enforcement.

 

(a)           This
Agreement and any and all matters arising directly or indirectly
here from shall be governed by, and construed and enforced in
accordance with, the internal Laws of the state of New York,
without giving effect to the conflict or choice of Law principles
thereof.

 

(b)           The
Parties hereby irrevocably:

 

(i) 

consent and submit
to the sole exclusive jurisdiction of the United States District
Court for the Southern District of New York and/or the state court
in New York City (and of the appropriate appellate courts from any
of the foregoing) in connection with any legal action, lawsuit,
arbitration, mediation, or other legal or quasi legal proceeding
directly or indirectly arising out of, or relating to, this
Agreement (“Proceeding”);

 

(ii) 

waive, to the
fullest extent permitted by Law, any objection a Party may now or
hereafter have to the venue of any such Proceeding in any such
court or that any such Proceeding which is brought in any such
court has been brought in an inconvenient forum;

 

(iii) 

waive, to the
fullest extent permitted by Law, any immunity from jurisdiction of
any such court or from any legal process therein;

 

(iv) 

waive, to the
fullest extent permitted by Law, any right to a trial by jury in
connection with a Proceeding;

 

 

-15-

 

 

(v) 

agree not to
commence any Proceeding other than in such court; and

 

(vi)  

agree that service
of any summons, complaint, notice or other process relating to such
Proceeding may be effected in the manner provided for the giving of
notice as set forth herein.

 

Section
7.9.  Specific
Enforcement. The Parties agree that irreparable damage may
occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or were
otherwise materially breached. It is accordingly agreed that any of
the Parties shall be entitled to seek an injunction or injunctions
to prevent material breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in
accordance with the provisions of Article IV and Article VII. The provisions of
this Section shall be in addition to any other remedy to which they
are entitled at Law or in equity.

 

Section
7.10. Joint Participation
in the Drafting. The Parties acknowledge and confirm that
each of their respective attorneys has participated jointly in the
drafting, review and revision of this Agreement and that it has not
been written solely by counsel for any Party and that each Party
has had the benefit of its independent legal counsel’s advice
with respect to the terms and provisions hereof and its rights and
obligations hereunder. Each Party, therefore, stipulates and agrees
that the rule of construction to the effect that any ambiguities
are to be or may be resolved against the drafting Party shall not
be employed in the interpretation of this Agreement to favor any
Party against another and that no Party shall have the benefit of
any legal presumption or the detriment of any burden of proof by
reason of any ambiguity or uncertain meaning contained in this
Agreement.

 

Section
7.11.  No Third Party
Beneficiaries. No Person not a party hereto shall have any
rights hereunder, it being the intent of the Parties that there
shall be no third party beneficiaries.

 

Section
7.12.  Gender;
Number. Except where the context otherwise requires, words
used in the masculine gender include the feminine and neuter; the
singular number includes the plural, and the plural the
singular.

 

Section
7.13.  Expenses. Seller agrees to
reimburse Purchaser for its reasonable and documented expenses
incurred in connection with the negotiation, execution and delivery
of this Agreement and the completion of the transactions
contemplated hereby including (i) its legal fees directly incurred
in connection with this Agreement and in the preparation of a new
operating agreement for the Company, (ii) invoiced fees and
expenses of UHY directly associated with their analysis of the tax
implications of the sale of Seller’s Membership Interests
hereunder to Purchaser,
(iii) fees and expenses associated with the filing of the
Certificate of Amendment (to the extent not handled by Seller), and
associated with the transfer or abandonment of any 214 License,
(iv) any taxes or other costs, such as FCC fees, imposed or
incurred as a direct result of the consummation of the transaction
contemplated herein; (v) for a period of up to 12 months from the
date of this Agreement, the costs associated with the
Company’s existing corporate email service that is hosted by
Google, and (vi) all preapproved, such approval not to be
unreasonably withheld, costs associated with the name change
including any costs incurred to change websites, URLs, marketing
and printed materials and contracts. In the event that Seller fails
to promptly reimburse Purchaser for any of the foregoing costs and
expense, Purchaser shall be entitled to off-set such amounts
against amounts owed by it to the Seller under the Note of even
date hereof.

 

 

-16-

 

 

Section
7.14  Indemnification. It is the
Purchaser’s understanding that the Company has been advised
by UHY that due to any profit sharing arrangement contemplated by
this Agreement, the Company (or any New Business) will be required
to issue the Seller a K-1 at the end of each fiscal year to reflect
any profits that are paid to the Seller under this Agreement.
Seller agree that it shall indemnify and hold harmless Purchaser
and any Affiliate or other New Business for any costs, expenses, or
losses incurred as a result of any filings or reporting made or
omitted by Seller, or any failure to pay taxes to the Internal
Revenue Service or any state taxing authority, in connection with
amounts reported by the Company to Seller hereunder.

 

 

 

 

 

[Signatures
appear on the following page]

 

 

 

-17-

 

 

IN WITNESS WHEREOF, the Parties have
executed this Agreement as of the Effective Date.

 

	
 

	

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

	
 

	
 

	

By:
__/s/ James P. Prenetta, Jr.  

	

Name:
James P. Prenetta, Jr.

Title:
EVP and General Counsel

 

	

XCOMIP
LLC

	
 

	

By: /s/
Yehuda “Jay” Adams  

	

 Name: Yehuda
“Jay” Adams

 Title:
Manager

 

	

FUSION
GLOBAL SERVICES LLC

	
 

	

By: /s/
Yehuda “Jay” Adams  

	

Name:
Yehuda “Jay” Adams

Title:
Manager

 

 

 

-18-

 

 

Exhibit A

 

NON-SOLICITATION AGREEMENT

 

           
  This Non-Solicitation Agreement, dated as of May 4, 2018
(the “Agreement”),
is made and entered into by and between Fusion Telecommunications
International, Inc., a Delaware corporation (“Fusion”)
and Fusion Global Services, LLC, and XcomIP, LLC (collectively, the
“Counterparty”).
As used herein, “the parties to this Agreement” or
“the parties” shall refer collectively to Fusion and
the Counterparty. Capitalized terms used herein and not defined
shall have the meaning assigned each such term in the Membership
Interest Agreement (as defined below).

 

WHEREAS, on the date hereof, Fusion,
XcomIP, LLC (“Xcom”)
and Fusion Global Services, LLC (“Fusion
Global”), are entering into a Membership Interest
Purchase and Sale Agreement (the “Membership Interest
Agreement”) by and among Fusion, Xcom and Fusion
Global under which Xcom will purchase from Fusion and Fusion will
sell and transfer to Xcom, all of its membership interests in
Fusion Global); and

 

WHEREAS, the execution and delivery of
this Agreement by Fusion and Counterparty is a condition precedent
to the closing of the transactions contemplated by the Membership
Interest Agreement.

 

NOW, THEREFORE, in consideration of the
covenants and mutual promises and agreements contained in this
Agreement, and other valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as
follows:

 

1. Non-Solicitation.
For a period of three (3) years from the date hereof, each of
Fusion and Counterparty agrees that it will not, either directly or
indirectly (including through its Affiliates) or as an agent on
behalf of, or in conjunction with any Person: (A) solicit for
employment or in any way induce or attempt to induce to leave the
employ of, or engagement by, the other party hereto, any individual
who is, on the date of the solicitation or attempted inducement, a
director, officer, employee or consultant to the other party
hereto; or (B) induce or attempt to induce any Person who is a
director, officer, employee or consultant to the other party to
leave the employ of, or terminate or breach their respective
agreements with, the other party, or in any other way deliberately
interfere with the relationship between the other party and any
such Person;  provided, however, that no general
advertisement or general solicitation of employment not targeted to
the directors, officers, employees or consultants of the other
party shall be deemed to be a solicitation of such Persons in
violation of this Section.

 

2.           
Acknowledgment.
Each of Fusion and the Counterparty acknowledges that this
Agreement and the obligations contained herein are essential to the
protection of the business of the other party and its subsidiaries
and is a material inducement to the other party to enter into the
Membership Interest Agreement and to closing the transactions
contemplated thereby.

 

 

 

-19-

 

 

3.           
Remedies Upon
Breach. The parties
acknowledge and agree that, in the event of a material breach of
any of the terms or provisions of this Agreement, nothing in this
Agreement shall be construed to preclude or limit any party from
asserting claims or filing a lawsuit for the purpose of enforcing
their rights under this Agreement, or pursuing any other rights and
remedies available to them under law, including equitable relief,
injunctive relief, and damages.

 

4.           Assignability
and Binding Effect.
The rights and obligations of the parties shall be binding upon,
inure to the benefit of, and be enforceable by the parties and
their respective successors and permitted assigns.

 

5.           
Waiver
of Breach. A waiver
by any party of a breach of any of the provisions of this Agreement
shall not operate or be construed as a waiver of any other
provision of this Agreement or of any subsequent breach of the same
or any other provision of this Agreement. The understandings and
representations of the parties set forth in this Agreement shall
survive any breach of this Agreement and be enforceable by the
non-breaching party.

 

6.           
Severability. 
The
provisions of this Agreement are severable. If any portion of this
Agreement (other than Section 1) is held, by a court of competent
jurisdiction, to be invalid or unenforceable or to conflict with
any federal, state or local law, such portion or portions of this
Agreement are hereby declared to be of no force or effect in such
jurisdiction, and this Agreement shall otherwise remain in full
force and effect and be construed as if such portion had not been
included. In the event that any provision of this Agreement is held
to be unenforceable for being unduly broad as written, such
provision shall be deemed amended to narrow its application to the
extent necessary to make the provision enforceable according to
applicable law and shall be enforced as amended to the maximum
legal and equitable extent.

 

7.           
Entire Agreement. This
Agreement is the entire agreement between the parties with respect
to the subject matter hereof and this Agreement supersedes and
replaces any and all prior and contemporaneous agreements,
representations, promises or understandings of any kind between the
parties with respect thereto. No modification, amendment or waiver
of any of the provisions of this Agreement shall be effective
unless in writing and signed by both parties.

 

8.           
Interpretation of
Agreement. The
parties acknowledge and agree that (i) this Agreement and its
reduction to final written form are the result of good faith
negotiations between the parties through their respective counsel;
(ii) said counsel have carefully reviewed and examined this
Agreement before execution by said parties, or any of them; and
(iii) any statute or rule of construction that ambiguities are to
be resolved against the drafting party shall not be employed in the
interpretation of this Agreement.

 

9.           
Governing
Law. This Agreement
and any disputes arising under or in connection with it shall be
construed and governed in accordance with the laws of the State of
New York.

 

10.         
Counterparts.
This Agreement may be executed in one or more counterparts with the
same effect as if both parties had signed the same document. All
counterparts shall be construed together and shall constitute one
and the same Agreement. This Agreement, to the extent signed and
delivered via email, shall be treated in all manner and respects as
an original agreement or instrument and shall be considered to have
the same binding legal effect as if it were the original signed
version thereof delivered in person.

 

 

-20-

 

 

           
   11.          
Further
Assurances. The
parties agree to give such further assurances and to execute such
documents as may be necessary to correct, confirm and effectuate
the intent and purpose of this
Agreement  

 

12.           
Captions.
The captions of the paragraphs of this Agreement are for
convenience only and shall not be considered or referenced in
resolving questions of construction or interpretation.

 

 

IN WITNESS
WHEREOF, the parties
hereto have executed this Agreement as of the date and year set
forth below.

 

	
 

	

Fusion Telecommunications International, Inc.

 

 

By:                                                                

Name:  Gordon
Hutchins, Jr.

Title:
President

 

XcomIP, LLC

 

 

By:                                                                

Name: Yehuda
“Jay” Adams.

Title:
Manager

 

 

Fusion Global Services, LLC

 

 

By:                                                                

Name: Yehuda
“Jay” Adams.

Title:
Manager

 

                                                                 

 

 

 

 

 

-21-

 

 

Exhibit B

 

 

Form of Certificate of Amendment

 

CERTIFICATE OF AMENDMENT

TO THE

CERTIFICATE OF FORMATION

OF

FUSION GLOBAL SERVICES LLC

 

 

The
undersigned, for the purpose of amending a certificate of formation
of a limited liability company pursuant to Section 18-202 of the
Delaware Limited Liability Company Act, certifies
that:

 

1.

The name of the limited liability company is
Fusion Global Services, LLC (the “Company”).

 

2.

Article
1 of the Certificate of Formation of the Company is hereby amended
to read as follows:

 

“1.
The name of the limited liability company is
“[                 
]”.

 

3.
The aforesaid amendment was duly adopted by the sole Member of the
Company.

 

IN WITNESS
WHEREOF, the Company has caused
this Certificate of Amendment to be signed on its behalf by the
duly authorized person on this ___ day of _______,
2018.

 

 

FUSION GLOBAL SERVICES, LLC

 

 

 

By:
______________________________

Name:
Yehuda “Jay” Adams

Title:
Manager

 

 

-22-

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