Document:

Stock Purchase Agreement dated December 10, 2004

 EXHIBIT 10.66 
  
 STOCK PURCHASE AGREEMENT 
  
 By and Between 
  
 CONSOLIDATED EDISON, INC. 
  
 and 
  
 FIBERNET TELECOM
GROUP, INC. 
  
 Dated as of December 10, 2004

 TABLE OF CONTENTS 
  

							
	 	  	 	  	 	  	Page

	 ARTICLE I DEFINITIONS
	  	1
	 	  	 Section 1.1
	  	Definitions	  	1
		
	 ARTICLE II PURCHASE OF SHARES
	  	13
	 	  	 Section 2.1
	  	Purchase of Shares	  	13
		
	 ARTICLE III THE CLOSING
	  	14
	 	  	 Section 3.1
	  	Closing	  	14
	 	  	 Section 3.2
	  	Closing Deliveries	  	14
	 	  	 Section 3.3
	  	Purchase Price Adjustments	  	15
	 	  	 Section 3.4
	  	Closing Date Financial Statements	  	19
		
	 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER
	  	19
	 	  	 Section 4.1
	  	Organization and Related Matters	  	19
	 	  	 Section 4.2
	  	Subsidiaries	  	20
	 	  	 Section 4.3
	  	Authority; No Violation	  	21
	 	  	 Section 4.4
	  	Consents and Approvals	  	22
	 	  	 Section 4.5
	  	Stock Ownership	  	22
	 	  	 Section 4.6
	  	Financial Statements	  	24
	 	  	 Section 4.7
	  	No Other Broker	  	24
	 	  	 Section 4.8
	  	Legal Proceedings	  	25
	 	  	 Section 4.9
	  	No Undisclosed Liabilities	  	25
	 	  	 Section 4.10
	  	Compliance with Applicable Law	  	25
	 	  	 Section 4.11
	  	Absence of Certain Changes	  	26
	 	  	 Section 4.12
	  	Technology and Intellectual Property	  	28
	 	  	 Section 4.13
	  	ERISA; Benefit Plans	  	29
	 	  	 Section 4.14
	  	Taxes	  	32
	 	  	 Section 4.15
	  	Contracts	  	34
	 	  	 Section 4.16
	  	Title to Assets	  	35
	 	  	 Section 4.17
	  	Transactions with Certain Persons	  	35
	 	  	 Section 4.18
	  	Environmental Laws	  	36
	 	  	 Section 4.19
	  	Insurance Coverage	  	36
	 	  	 Section 4.20
	  	Real Property	  	37
	 	  	 Section 4.21
	  	Receivables	  	38
	 	  	 Section 4.22
	  	Labor and Employee Relations	  	38
	 	  	 Section 4.23
	  	Certain Employees	  	39
	 	  	 Section 4.24
	  	Tangible Properties	  	39
	 	  	 Section 4.25
	  	Banks, Brokers and Proxies	  	40
		
	 ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER
	  	41
	 	  	 Section 5.1
	  	Organization and Related Matters	  	41
	 	  	 Section 5.2
	  	Authority; No Violation	  	41
	 	  	 Section 5.3
	  	Consents and Approvals	  	42
	 	  	 Section 5.4
	  	Legal Proceedings	  	43
	 	  	 Section 5.5
	  	Investment Intent of Buyer	  	43
	 	  	 Section 5.6
	  	No Other Broker	  	43
	 	  	 Section 5.7
	  	Financing	  	44

  

 i 

							
	 	  	 Section 5.8
	  	Securities Purchase Documents	  	44
	 	  	 Section 5.9
	  	Amendment of Credit Facility	  	44
		
	 ARTICLE VI COVENANTS
	  	45
	 	  	 Section 6.1
	  	Conduct of Business	  	45
	 	  	 Section 6.2
	  	Public Announcements	  	46
	 	  	 Section 6.3
	  	Expenses	  	46
	 	  	 Section 6.4
	  	Access; Certain Communications	  	47
	 	  	 Section 6.5
	  	Regulatory Matters; Third Party Consents	  	48
	 	  	 Section 6.6
	  	Further Assurances	  	51
	 	  	 Section 6.7
	  	Notification of Certain Matters	  	51
	 	  	 Section 6.8
	  	Updated Schedules	  	51
	 	  	 Section 6.9
	  	Access To Records After Closing Date	  	52
	 	  	 Section 6.10
	  	Employee Benefits	  	53
	 	  	 Section 6.11
	  	No Solicitations	  	60
	 	  	 Section 6.12
	  	Change In Name of Company and Subsidiaries; No Transfer Of Rights to Names of Seller, Seller Affiliates Or Predecessors	  	60
	 	  	 Section 6.13
	  	Retained Liability For Certain Litigation	  	61
	 	  	 Section 6.14
	  	Release of Indemnity Obligations	  	62
	 	  	 Section 6.15
	  	Non-Competition; Confidentiality	  	62
	 	  	 Section 6.16
	  	Estoppel Certificates	  	65
	 	  	 Section 6.17
	  	Cooperation	  	66
	 	  	 Section 6.18
	  	Security and Reimbursement Obligations	  	66
	 	  	 Section 6.19
	  	Insurance	  	67
	 	  	 Section 6.20
	  	Notice of Termination of Securities Purchase Agreement	  	68
	 	  	 Section 6.21
	  	Dissolution of CEC VA	  	68
		
	 ARTICLE VII TAX MATTERS
	  	68
	 	  	 Section 7.1
	  	Indemnity	  	68
	 	  	 Section 7.2
	  	Tax Allocation Agreement Payments	  	70
	 	  	 Section 7.3
	  	Returns and Payments	  	70
	 	  	 Section 7.4
	  	Refunds	  	72
	 	  	 Section 7.5
	  	Contests	  	72
	 	  	 Section 7.6
	  	Section 338(h)(10) Election	  	73
	 	  	 Section 7.7
	  	Time of Payment	  	74
	 	  	 Section 7.8
	  	Cooperation and Exchange of Information	  	75
	 	  	 Section 7.9
	  	Conveyance Taxes	  	75
	 	  	 Section 7.10
	  	Miscellaneous	  	76
		
	 ARTICLE VIII CONDITIONS TO CLOSING
	  	76
	 	  	 Section 8.1
	  	Conditions to Buyer’s Obligations	  	76
	 	  	 Section 8.2
	  	Conditions to Seller’s Obligations	  	79
	 	  	 Section 8.3
	  	Mutual Condition	  	81
		
	 ARTICLE IX SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS; INDEMNIFICATION
	  	81
	 	  	 Section 9.1
	  	Survival	  	81
	 	  	 Section 9.2
	  	Obligation of Seller to Indemnify	  	82
	 	  	 Section 9.3
	  	Obligation of Buyer to Indemnify	  	82

  

 ii 

							
	 	  	 Section 9.4
	  	Notice and Opportunity to Defend Against Third Party Claims	  	83
	 	  	 Section 9.5
	  	Tax Indemnification	  	84
	 	  	 Section 9.6
	  	Limits on Indemnification	  	85
		
	 ARTICLE X TERMINATION
	  	86
	 	  	 Section 10.1
	  	Termination	  	86
	 	  	 Section 10.2
	  	Obligations upon Termination	  	87
		
	 ARTICLE XI MISCELLANEOUS
	  	87
	 	  	 Section 11.1
	  	Amendment	  	87
	 	  	 Section 11.2
	  	Entire Agreement	  	87
	 	  	 Section 11.3
	  	Interpretation	  	88
	 	  	 Section 11.4
	  	Severability	  	88
	 	  	 Section 11.5
	  	Notices	  	89
	 	  	 Section 11.6
	  	Binding Effect; Persons Benefiting; No Assignment	  	90
	 	  	 Section 11.7
	  	Counterparts	  	90
	 	  	 Section 11.8
	  	No Prejudice	  	90
	 	  	 Section 11.9
	  	Governing Law	  	90
	 	  	 Section 11.10
	  	Limited Liability	  	90
	 	  	 Section 11.11
	  	Jurisdiction and Enforcement	  	90
	 	  	 Section 11.12
	  	WAIVER OF TRIAL BY JURY	  	91

  

 iii 

 SCHEDULES 
  

			
	 Schedule 1.1(a)
	  	Subsidiaries
	 Schedule 1.1(b)
	  	Tax Allocation Agreements
	 Schedule 1.1(c)
	  	Required Capital Expenditures Amount
	 Schedule 1.1(d)
	  	Working Capital
	 Schedule 1.1(e)
	  	55 Broad Street Security Agreement
	 Schedule 1.1(f)
	  	111 Eighth Avenue Security Agreement
	 Schedule 1.1(g)
	  	Rider X Security Agreement
	 Schedule 1.1(h)
	  	Excluded Consents
	 Schedule 4.1(c)
	  	Minute Books
	 Schedule 4.2
	  	Subsidiary Information
	 Schedule 4.3(b)
	  	No Violation, Conflicts or Breaches
	 Schedule 4.4
	  	Seller’s Consents and Approvals
	 Schedule 4.5
	  	Stock Ownership
	 Schedule 4.6
	  	Financial Statements
	 Schedule 4.8
	  	Legal Proceedings
	 Schedule 4.9
	  	Undisclosed Liabilities
	 Schedule 4.10
	  	Compliance with Applicable Law
	 Schedule 4.11
	  	Absence of Certain Changes
	 Schedule 4.12
	  	Intellectual Property
	 Schedule 4.13(a)
	  	Seller’s Benefit Plans
	 Schedule 4.13(b)
	  	Company Employee Plans
	 Schedule 4.14
	  	Taxes
	 Schedule 4.15(d)
	  	Seller-Provided Indebtedness
	 Schedule 4.16
	  	Title to Assets
	 Schedule 4.17
	  	Transactions with Certain Persons
	 Schedule 4.18
	  	Environmental Laws
	 Schedule 4.20(b)
	  	Leases
	 Schedule 4.20(c)
	  	Necessary Leases
	 Schedule 4.23
	  	Employees
	 Schedule 4.24(a)
	  	Network Facilities
	 Schedule 4.25
	  	Banks, Brokers and Proxies
	 Schedule 5.3
	  	Buyer’s Consents and Approvals
	 Schedule 6.14
	  	Form of Release
	 Schedule 6.16
	  	Form of Estoppel Certificate
	 Schedule 6.18
	  	Retained Seller-Provided Indebtedness
	 Schedule 8.1(d)
	  	Good Standing Certificates
	 Schedule 8.1(h)
	  	Form of Opinion of Seller’s Counsel
	 Schedule 8.2(f)
	  	Form of Opinion of Buyer’s Counsel

  

 iv 

 STOCK PURCHASE AGREEMENT 
  
 STOCK PURCHASE AGREEMENT, dated as of December 10, 2004, by and between CONSOLIDATED EDISON, INC., a New York corporation
(“Seller”), and FIBERNET TELECOM GROUP, INC., a Delaware corporation (“Buyer”). 
  
 RECITALS 
  
 WHEREAS, Seller is the owner of fifty million (50,000,000) shares (the “Shares”) of the common stock of Consolidated Edison Communications Holding Company, Inc., a New York corporation (the “Company”), which shares
constitute all of the issued and outstanding shares of the Company’s capital stock as of the date hereof; and 
  
 WHEREAS, Seller desires to sell, and Buyer desires to purchase, the Shares, upon the terms and subject to the conditions set forth herein. 
  
 NOW THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements contained herein, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be bound hereby, the parties agree as follows: 
  
 ARTICLE I 
 DEFINITIONS 
  
 Section 1.1 Definitions. For all purposes of this Agreement, the following terms shall have the respective meanings set forth in this Section 1.1 (such definitions to be equally applicable to both the singular and plural forms of the
terms herein defined): 
  
 “1st Layer Excess Policy” has the meaning set forth in Section 6.19. 
  
 “1st Layer Excess Renewal Policy” has the meaning set forth in Section 6.19. 
  
 “55 Broad Street Security Agreement” means the Agreement in the form attached hereto as Schedule 1(e). 

 

 “111 Eighth Avenue Security Agreement” means the Agreement in the form attached hereto as
Schedule 1(f). 
  
 “2004 Plans” has the meaning set
forth in Section 6.10(h). 
  
 “2005 Plans” has the
meaning set forth in Section 6.10(h). 
  
 “Acquisition
Proposal” means any inquiry, proposal or offer from any Person (other than Buyer or any of its Affiliates) relating to any merger, consolidation, recapitalization, liquidation or other direct or indirect business combination or reorganization
involving the Company or any Subsidiary, the sale, transfer, lease, exchange, license or other disposition of all or substantially all of the assets of the Company or any Subsidiary (other than sales of inventory or licenses of Intellectual Property
Rights in the ordinary course of business), or any other similar transaction, the consummation of which could reasonably be expected to impede, interfere with, prevent or materially delay the consummation of the transactions contemplated by this
Agreement or which could reasonably be expected to diminish significantly the benefits to Buyer or its Affiliates of the transactions contemplated hereby. 
  
 “Adjustment Indebtedness” means (a) all indebtedness of the Company or any Subsidiary for borrowed money; (b) to
the extent not otherwise included in (a) above, all obligations of the Company or any Subsidiary evidenced by notes, bonds, debentures or other similar instruments; and (c) to the extent not otherwise included in (a) or (b) above, Capital
Expenditure Indebtedness; in the case of any of (a), (b), or (c) above other than (i) any such indebtedness or obligations approved by the prior written consent of Buyer and (ii) any Seller-Provided Indebtedness. 
  
 “Affiliate” means, with respect to any Person, any other Person who
directly or indirectly controls, is controlled by or is under common control with such Person. The term “control”, for the purposes of this definition, means the power to direct or cause the direction of the management or policies of the
controlled Person. 
  
 “Affiliated Group” has the
meaning set forth in Section 4.14(a). 
  

 2 

 “Agreement” means this Stock Purchase Agreement, including the Schedules hereto, the Company
Employee List, the Contracts List, the Insurance and Bond List, the Performance Statistics Charts and the Stock Options List, as it may hereafter be amended from time to time. 
  
 “Allocation” has the meaning set forth in Section 7.6(b). 
  
 “Amendment to Credit Agreement” has the meaning set forth in
Section 5.9. 
  
 “Applicable Insurance Policies” has the
meaning set forth in Section 6.19. 
  
 “Asserted
Liability” has the meaning set forth in Section 9.4(a). 
  
 “Benefit Plans” has the meaning set forth in Section 4.13(b). 
  
 “Business Day” means any day other than a Saturday, a Sunday or a day on which banks in New York, New York are required to be closed for regular banking business. 
  
 “Buyer” has the meaning set forth in the first paragraph of this
Agreement. 
  
 “Buyer Objection Notice” has the meaning
set forth in Section 3.3(d)(ii). 
  
 “Buyer Objection
Period” has the meaning set forth in Section 3.3(d)(ii)(A). 
  
 “Buyer’s Benefit Plans” has the meaning set forth in Section 6.10(e). 
  
 “Buyer’s Lenders” means the financial institutions party to the Credit Agreement. 
  
 “Buyer’s Severance Plan” has the meaning set forth in Section 6.10(c). 
  
 “Buyer Transaction Documents” has the meaning set forth in Section 5.2(a). 
  
 “Capital Expenditure Commitment” has the meaning set forth in
Section 6.1. 
  

 3 

 “Capital Expenditure Commitment Budget” means (a) with respect to any calendar month in the
Interim Period that falls within the calendar year 2004, (i) $717,000 plus (ii) the difference (if a positive number) between the Capital Expenditure Commitment Budget for the preceding calendar month and the aggregate Capital Expenditure
Commitments for the preceding calendar month, and (b) with respect to any other calendar month in the Interim Period, (i) $650,000 plus (ii) the difference (if a positive number) between the Capital Expenditure Commitment Budget for the preceding
calendar month and the aggregate Capital Expenditure Commitments for the preceding calendar month. 
  
 “Capital Expenditure Indebtedness” means any indebtedness or obligations incurred by the Company or any Subsidiary for the purpose of financing
any Capital Expenditures. 
  
 “Capital Expenditures”
means expenditures qualifying as capital expenditures pursuant to generally accepted accounting principles as used in the United States of America as in effect at the time of the expenditure, regardless of whether such expenditures are funded by
Capital Expenditure Indebtedness, but excluding any payroll expenses or employee wages and benefits in respect of Company Employees that are capitalized or otherwise included in capital expenditures. 
  
 “CECONY” means Consolidated Edison Company of New York, Inc.

  
 “CFO” means the Chief Financial Officer or the
successor to such officer’s responsibilities. 
  
 “Claims Notice” has the meaning set forth in Section 9.4(a). 
  
 “Closing” has the meaning set forth in Section 3.1. 
  
 “Closing Date” has the meaning set forth in Section 3.1. 
  
 “Closing Date Balance Sheet” means the audited balance sheet (including the related notes and schedules thereto) of the Company and the
Subsidiaries as of the Closing Date, prepared in accordance with GAAP, consistently applied. 
  

 4 

 “Closing Date Financial Statements” means, collectively, the Closing Date Balance Sheet,
Closing Date Income Statement and Closing Date Statement of Cash Flows. 
  
 “Closing Date Income Statement” means an audited income statement of the Company and the Subsidiaries for the twelve (12) month period ending on the Closing Date, prepared in accordance with GAAP, consistently applied. 

 
 “Closing Date Statement of Cash Flows” means an audited
statement of cash flows of the Company and the Subsidiaries for the twelve (12) month period ending on the Closing Date, prepared in accordance with GAAP, consistently applied. 
  
 “Closing Purchase Price Payment” has the meaning set forth in Section 3.2(c). 
  
 “COBRA” means Title X of the Consolidated Omnibus Budget
Reconciliation Act of 1985 as codified under Section 4980B of the Code (as amended) and Title I part 6 of ERISA regulations thereunder. 
  
 “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute. 
  
 “Company” has the meaning set forth in the Recitals of this
Agreement. 
  
 “Company CIC Plan” has the meaning set
forth in Section 6.10(d). 
  
 “Company Employee List”
has the meaning set forth in Section 6.10(j). 
  
 “Company
Employees” has the meaning set forth in Section 4.13(a). 
  
 “Company Employee Plans” has the meaning set forth in Section 4.13(b). 
  
 “Company GAAP Financial Statements” has the meaning set forth in Section 4.6(a). 
  
 “Company Option Plan” means the Consolidated Edison Communications, Inc. Long Term Stock Incentive Plan as 

  

 5 

 
ratified, confirmed and approved by the Company to be amended to express the application of such plan to the Company and to shares of capital stock of the
Company (including with respect to stock options previously granted under such plan). 
  
 “Confidentiality Agreement” means that certain agreement dated February 17, 2004, between Buyer and Seller with respect to the confidentiality of information relating to Seller, the Company, the
Subsidiaries, their respective Affiliates and/or other Persons that was provided to Buyer or its representatives by or at the request of Seller, the Company and/or their respective Affiliates, as such agreement may be amended from time to time.

  
 “Consolidated Return” has the meaning set forth in
Section 7.3(a). 
  
 “Contest” has the meaning set forth
in Section 7.5(a). 
  
 “Contracts” has the meaning set
forth in Section 4.15(a). 
  
 “Contracts List” has the
meaning set forth in Section 4.15(a). 
  
 “Credit
Agreement” has the meaning set forth in Section 5.9. 
  
 “CSS” means Competitive Shared Services, Inc. 
  
 “Downward Capital Expenditure Adjustment” has the meaning set forth in Section 3.3(a)(ii). 
  
 “Downward Working Capital Adjustment” has the meaning set forth in Section 3.3(c)(ii). 
  
 “Election” has the meaning set forth in Section 7.6(a). 

 
 “Encumbrance” means any lien, pledge, security interest, claim,
easement or other encumbrance; provided, however, that this definition of “Encumbrance” shall not include: (a) with respect to all property other than the Shares, (i) liens for current Taxes not yet due and payable, including
liens for nondelinquent ad valorem Taxes and nondelinquent statutory liens arising other than by reason 

  

 6 

 
of any default on the part of Seller, the Company or any Subsidiary for which appropriate reserves have been established and are reflected on the relevant
financial statements, (ii) such liens, minor imperfections of title or easements on real property, leasehold estates or personalty as do not detract from the value thereof in a material respect and do not interfere in a material respect with the
present use of the property subject thereto, and (iii) materialmen’s, mechanics’, workmen’s, repairmen’s, employees’, carriers’, warehousemen’s and other like liens arising in the ordinary course of business or
relating to any construction, rebuilding or repair of any property leased pursuant to any lease agreement, so long as any such lien does not materially impair the value of such leased property; and (b) with respect to the Shares only, any lien,
pledge, security interest, claim, easement or other encumbrance (i) arising as a result of any action taken by Buyer or any of its Affiliates, and (ii) imposed upon the transfer of the Shares by any registration provision of the Securities Act of
1933, as amended, or any applicable state securities or other law regulating the disposition of the Shares. 
  
 “Environmental Laws” means any applicable law relating to the control of any pollutant or hazardous material, the protection of the environment
or the effect of the environment on human health, including the Comprehensive Environmental Response, Compensation and Liability Act of 1980 as amended. 
  
 “Environmental Permits” means all permits, approvals, licenses and other authorizations required under any Environmental Law. 
  
 “ERISA” means the Employee Retirement Income Security Act of 1974,
as amended. 
  
 “Estimated Adjustment Amount” has the
meaning set forth in Section 3.3(d)(i). 
  
 “Excluded
Consents” means the filings, notifications, authorizations, consents and approvals listed in Schedule 1.1(h). 
  
 “Final Adjustment Amount” has the meaning set forth in Section 3.3(d)(iv). 
  

 7 

 “Final Adjustment Certificate” has the meaning set forth in Section 3.3(d)(iv). 
  
 “Financial Statements Accounting Firm” has the meaning set forth in
Section 3.4. 
  
 “Franchise Fees” has the meaning set
forth in Section 7.1(b)(i). 
  
 “GAAP” means generally
accepted accounting principles as used in the United States of America as in effect at the time any applicable financial statements were prepared or any act requiring the application of GAAP was performed. 
  
 “Governmental Authority” means any nation or government, any state
or other political subdivision thereof, or any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. 
  
 “Indebtedness” means, with respect to any Person, (a) all indebtedness of such Person, whether or not contingent,
for borrowed money, (b) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (c) all indebtedness created or arising under any conditional sale agreement with respect to any property acquired by such
Person, (d) all obligations of such Person as lessee under leases that have been or should be, in accordance with GAAP, recorded as capital leases, (e) all obligations, contingent or otherwise, of such Person under banker’s acceptances, letters
of credit or similar facilities, and (f) all Indebtedness of others referred to in clauses (a) through (e) above guaranteed directly or indirectly in any manner by such Person. For the avoidance of doubt, “Indebtedness” with respect to the
Company or any Subsidiary shall include Capital Expenditure Indebtedness and Adjustment Indebtedness, but shall not include any Seller-Provided Indebtedness. 
  
 “Indebtedness Adjustment” has the meaning set forth in Section 3.3(b). 
  
 “Indemnifying Party” has the meaning set forth in Section 9.4(a). 
  
 “Indemnitee” has the meaning set forth in Section 9.4(a).

  

 8 

 “Independent Accounting Firm” means an independent accounting firm of national reputation that
is selected by Seller and Buyer or, if Seller and Buyer cannot agree within five (5) days after Seller’s receipt of a Buyer Objection Notice, then by Seller’s and Buyer’s accounting firms; provided, however, that if
Seller’s and Buyer’s accounting firms cannot agree on an independent accounting firm within five (5) days after such decision is referred to them for determination, then the independent accounting firm shall be selected by the American
Arbitration Association. 
  
 “Insurance and Bond List”
has the meaning set forth in Section 4.19. 
  
 “Interim
Adjustment Amount” has the meaning set forth in Section 3.3(d)(ii)(A). 
  
 “Interim Adjustment Date” has the meaning set forth in Section 3.3(d)(ii)(B). 
  
 “Intellectual Property Right” has the meaning set forth in Section 4.12(a). 
  
 “Interim Financial Statements” has the meaning set forth in Section 4.6(a). 
  
 “Interim Period” has the meaning set forth in Section 3.3(a)(i).

  
 “IRS” means the Internal Revenue Service.

  
 “IRUs” has the meaning set forth in Section 4.11(e).

  
 “Leases” has the meaning set forth in Section
4.20(b). 
  
 “Loss” means any and all claims,
losses, liabilities, and damages and reasonable costs and expenses (including reasonable attorney’s fees and expenses) related thereto. 
  
 “Mastec Litigation” has the meaning set forth in Section 6.13. 
  
 “Material Adverse Effect” means a material adverse effect on the operations or condition (financial or otherwise)
of the Company and the Subsidiaries, taken as a 

  

 9 

 
whole; provided, however, to the extent such effect results from any of the following, such effect shall not be considered a Material Adverse
Effect:(i) general conditions applicable to the economy of the United States or elsewhere, including changes in interest rates and changes in the stock or other financial markets; (ii) conditions generally affecting the telecommunications industry;
or (iii) conditions or effects resulting from or relating to the announcement or the existence or terms of this Agreement or the consummation of the transactions contemplated hereby. 
  
 “Necessary Leases” has the meaning set forth in Section 4.20(c). 
  
 “Net Non-Disputed Adjustment Amount” means the net adjustment made
to the Purchase Price in connection with the Non-Disputed Initial Adjustment Amount and the Non-Disputed Interim Adjustment Amount. 
  
 “Network Facilities” has the meaning set forth in Section 4.24. 
  
 “Non-Disputed Initial Adjustment Amount” has the meaning set forth in Section 3.3(d)(i)(B). 
  
 “Non-Disputed Interim Adjustment Amount” has the meaning set forth
in Section 3.3(d)(ii)(B). 
  
 “Performance Statistic
Charts” has the meaning set forth in Section 4.24. 
  
 “Permits” has the meaning set forth in Section 4.10(a). 
  
 “Person” means any individual, corporation, company, partnership (limited or general), joint venture, limited liability company, association, trust or other entity. 
  
 “Post-Closing Adjustment Certificate” has the meaning set forth in
Section 3.3(d)(ii). 
  
 “Pre-Closing Adjustment
Certificate” has the meaning set forth in Section 3.3(d)(i). 
  
 “Purchase Price” has the meaning set forth in Section 2.1. 
  

 10 

 “Release” has the meaning set forth in Section 6.14. 
  
 “Replaced Seller-Provided Indebtedness” has the meaning set forth
in Section 6.18. 
  
 “Required Capital Expenditures
Amount” means the amount of Capital Expenditures determined in accordance with Schedule 1.1(c) hereto. 
  
 “Restricted Area” means the following geographic areas: the City of New York, Westchester County in the State of New York, Hudson County in the
State of New Jersey Fairfield County in the State of Connecticut and any other county in the State of New York, New Jersey, Connecticut or any other State in which (a) customer premises receiving Restricted Business services from the Company or any
Subsidiary as of the Closing Date are located and (b) either (i) Network Facilities owned by the Company or any Subsidiary are located as of the Closing Date or (ii) Network Facilities used by the Company or any Subsidiary pursuant to an agreement
for IRUs entered into by the Company or any Subsidiary are located as of the Closing Date. 
  
 “Restricted Business” means the telecommunications services business of the Company and the Subsidiaries as conducted on the Closing Date. 
  
 “Restricted Parties” has the meaning set forth in Section 6.15(a). 
  
 “Restricted Period” has the meaning set forth in Section 6.15(a).

  
 “Retained Seller-Provided Indebtedness” has the
meaning set forth in Section 6.18. 
  
 “Rider X Security
Agreement” means the Agreement in the form attached hereto as Schedule 1.1(g). 
  
 “SEC” means the Securities and Exchange Commission. 
  
 “Securities Purchase Agreement” has the meaning set forth in Section 5.8. 
  

 11 

 “Securities Purchase Documents” has the meaning set forth in Section 5.8. 
  
 “Security Agreements” means, collectively, the 55 Broad Street
Security Agreement, the 111 Eighth Avenue Security Agreement and the Rider X Security Agreement. 
  
 “Seller” has the meaning set forth in the first paragraph of this Agreement. 
  
 “Seller-Provided Indebtedness” means all guarantees, letters of credit or other security issued, granted,
furnished or obtained by Seller or any of its Affiliates (other than the Company or any Subsidiary) on behalf of or for the benefit of the Company or any of the Subsidiaries. 
  
 “Seller’s Benefit Plans” has the meaning set forth in Section 4.13(a). 
  
 “Seller Transaction Documents” has the meaning set forth in Section
4.3(a). 
  
 “Shares” has the meaning set forth in the
Recitals of this Agreement. 
  
 “Stock Options List” has
the meaning set forth in Section 4.5. 
  
 “Subsidiaries”
or “Subsidiary” means (a) as of the date hereof, the Persons or a Person, as the case may be, listed in Section I of Schedule 1.1(a) and (b) as of the Closing Date, the Persons or a Person, as the case may be, listed in Section II of
Schedule 1.1(a). 
  
 “Tax” means all taxes, charges,
fees, surcharges (including the federal Universal Service Fund charges and surcharges, the New York State Targeted Accessibility Fund charges and surcharges and any other regulatory charge or surcharge that may be imposed by any Governmental
Authority) and levies based upon gross or net income, gross receipts, franchises, premiums, profits, sales, use, value added, transfer, employment or payroll, including any ad valorem, environmental, excise, license, occupation, property, severance,
stamp, withholding, or windfall profit tax, any custom duty or other tax, together with any interest credit or charge, penalty, addition to tax or 

  

 12 

 
additional amount imposed by or payable to any Taxing Authority. 
  
 “Tax Allocation Agreements” means the tax allocation agreements to which the Company or the Subsidiaries are parties, which are noted on
Schedule 1.1(b). 
  
 “Tax Return” means, with respect to
any corporation or group of corporations, all reports, estimates, extension requests, information statements and returns relating to, or required to be filed in connection with, any payment of any Tax. 
  
 “Taxing Authority” means the IRS and any other domestic or foreign
Governmental Authority responsible for the administration of any Tax. 
  
 “Treasury Regulations” has the meaning set forth in Section 7.6(a). 
  
 “Updated Schedules” has the meaning set forth in Section 6.8. 
  
 “Upward Capital Expenditure Adjustment” has the meaning set forth in Section 3.3(a)(i). 
  
 “Upward Working Capital Adjustment” has the meaning set forth in
Section 3.3(c)(i). 
  
 “Wire Transfer” means a payment
in immediately available funds by wire transfer in lawful money of the United States of America to such account or accounts as shall have been designated by notice to the paying party. 
  
 “WTC Site Cases” has the meaning set forth in Schedule 4.8 to this Agreement. 
  
 “Working Capital” means the working capital of the Company and the
Subsidiaries as calculated in accordance with Schedule 1.1(d) hereto. 
  
 ARTICLE II 
 PURCHASE OF SHARES 
  
 Section 2.1 Purchase of Shares. Upon the terms and subject to the conditions set forth in this Agreement, at the
Closing Seller shall sell to Buyer, and Buyer shall 

  

 13 

 
purchase from Seller, subject to Section 3.3 below, the Shares for an aggregate amount equal to Thirty Seven Million Dollars ($37,000,000) (the
“Purchase Price”). 
  
 ARTICLE III 
 THE CLOSING 
  
 Section 3.1 Closing. Upon the terms and subject to the conditions of this Agreement, the closing of the purchase and sale of the Shares (the
“Closing”) shall be at 10:00 A.M. local time at the offices of Seller located at 4 Irving Place, New York, New York 10003, on the third Business Day following the date on which all of the conditions set forth in Article VIII (other than
those conditions designating instruments, certificates or other documents to be delivered at the Closing) shall have been satisfied or waived, or such other location, date and time as Buyer and Seller shall agree upon in writing. The date upon which
Closing actually occurs is hereinafter referred to as the “Closing Date” and the Closing shall be effective for all purposes herein as of 12:00 noon New York City time on the Closing Date (or such other time as Buyer and Seller shall agree
upon in writing). 
  
 Section 3.2 Closing Deliveries. At
the Closing, the parties hereto shall take the following actions: 
  
 (a) Seller shall deliver to Buyer (or Buyer’s designee as provided in Section 11.6 hereof) one or more certificates representing all of the Shares, duly executed in blank or accompanied by stock powers duly executed in blank, in proper
form for transfer, with all appropriate stock transfer tax stamps affixed; 
  
 (b) Seller shall deliver to Buyer the minute books, stock ledgers, corporate seal and all other corporate books and records of the Company and the Subsidiaries, which delivery may be effected by leaving the foregoing
books, ledgers, seal and records in the offices of the Company and the Subsidiaries as of the Closing Date; 
  
 (c) Buyer shall deliver to Seller the Purchase Price as due and payable at the Closing (taking into account the Non-Disputed Initial Adjustment Amount)
(the “Closing Purchase Price Payment”), by Wire Transfer. Any disputed 

  

 14 

 
adjustments to the Purchase Price shall be resolved and paid in accordance with Section 3.3 below. 
  
 (d) Each party hereto shall deliver to the other the opinions, certificates
and other documents, as applicable, required to be delivered by such party pursuant to Article VIII hereof; and 
  
 (e) Upon receipt of the Shares, Buyer shall deliver to Seller a receipt evidencing receipt of the Shares and, upon receipt of the Closing Purchase Price
Payment, Seller shall deliver to Buyer a receipt evidencing receipt of the Closing Purchase Price Payment. 
  
 Section 3.3 Purchase Price Adjustments. 
  
 (a) Capital Expenditure Adjustment. 
  
 (i) If, during the period from the date hereof to and including the Closing Date (the “Interim Period”), the Company and the
Subsidiaries, on a combined basis, have made and paid for Capital Expenditures in excess of the Required Capital Expenditures Amount, then the Purchase Price shall be increased by an amount equal to such excess (the “Upward Capital Expenditure
Adjustment”). 
  
 (ii) If,
during the Interim Period, the Company and the Subsidiaries, on a combined basis, have made and paid for Capital Expenditures in an amount that is less than the Required Capital Expenditures Amount, then the Purchase Price shall be decreased by an
amount equal to the difference between the Required Capital Expenditures Amount and the amount of Capital Expenditures made and paid for by the Company and the Subsidiaries during the Interim Period (the “Downward Capital Expenditure
Adjustment”). 
  
 (b) Indebtedness Adjustment. The
Purchase Price shall be reduced, dollar for dollar, by the outstanding principal amount of any Adjustment Indebtedness on the Closing Date (the “Indebtedness Adjustment”). 
  
 (c) Working Capital Adjustment. 
  
 (i) If the Working Capital of the Company and the Subsidiaries, on a combined basis, as of the Closing Date
exceeds $0, then the Purchase Price shall be increased, dollar for dollar, in an amount equal to such excess (the “Upward Working Capital Adjustment”). 
  

 15 

 (ii) If the Working Capital of the Company and the Subsidiaries, on a combined basis, as
of the Closing Date is less than $0, then the Purchase Price shall be decreased, dollar for dollar, in an amount equal to such negative amount (the “Downward Working Capital Adjustment”). 
  
 (d) Determination and Payment of Adjustments. 
  
 (i) (A) At least fifteen (15) days prior to the Closing
Date, Seller shall prepare and deliver to Buyer a certificate of the CFO of CSS (the “Pre-Closing Adjustment Certificate”), setting forth Seller’s good faith estimate, as of the Closing Date, of the Upward Capital Expenditure
Adjustment or Downward Capital Expenditure Adjustment (if any), the Indebtedness Adjustment (if any), the Upward Working Capital Adjustment or Downward Working Capital Adjustment (if any) and the cumulative net adjustment amount as a result of the
foregoing adjustments (the “Estimated Adjustment Amount”). Within ten (10) days following Buyer’s receipt of the Pre-Closing Adjustment Certificate, Buyer may object in good faith to the Estimated Adjustment Amount in writing, in
which case Buyer shall set forth the reason(s) for its good faith dispute. For purposes of Buyer’s review of the Pre-Closing Adjustment Certificate, Seller agrees to permit Buyer and its accountants to examine all working papers, schedules and
other documentation used or prepared in producing the Pre-Closing Adjustment Certificate. 
  
 (B) If Buyer objects to the Estimated Adjustment Amount within such ten (10) day period, Seller and Buyer shall attempt to resolve such
dispute through good faith negotiation. If Seller and Buyer are unable to resolve such dispute by the date that is one (1) day prior to the Closing Date (or if Buyer fails to object to the Estimated Adjustment Amount within the time period specified
above), the amount of the Estimated Adjustment Amount not disputed in good faith by Buyer (or if Buyer fails to object to the Estimated Adjustment Amount within the time period specified above, the Estimated Adjustment Amount) (the
“Non-Disputed Initial Adjustment Amount”) shall be paid by Buyer or deducted from the Purchase Price, as the case may be, on the Closing Date, and any good faith dispute with respect to the Estimated Adjustment Amount 

  

 16 

 
shall be resolved in connection with the adjustments provided in Sections 3.3(d)(ii) and/or (iii) below. 
  
 (ii) (A) Within twenty (20) days after the Closing Date,
Seller shall prepare and deliver to Buyer a certificate of the CFO of CSS (the “Post-Closing Adjustment Certificate”), setting forth Seller’s calculation, as of the Closing Date, of the Upward Capital Expenditure Adjustment or
Downward Capital Expenditure Adjustment (if any), the Indebtedness Adjustment (if any), the Upward Working Capital Adjustment or Downward Working Capital Adjustment (if any) and the cumulative net adjustment amount as a result of the foregoing
adjustments (the “Interim Adjustment Amount”). Within ten (10) days following Buyer’s receipt of the Post-Closing Adjustment Certificate (the “Buyer Objection Period”), Buyer may object in good faith to the Interim
Adjustment Amount in writing, in which case it shall set forth the reason(s) for its good faith dispute (any such written objection, a “Buyer Objection Notice”). For purposes of Buyer’s review of the Post-Closing Adjustment
Certificate, Seller agrees to permit Buyer and its accountants to examine all working papers, schedules and other documentation used or prepared in producing the Post-Closing Adjustment Certificate. 
  
 (B) If Buyer objects to the Interim Adjustment Amount within
the Buyer Objection Period, Seller and Buyer shall attempt to resolve such dispute through good faith negotiation. If Seller and Buyer are unable to resolve such dispute within five (5) days after the end of the Buyer Objection Period (or if Buyer
fails to object to the Interim Adjustment Amount within the Buyer Objection Period), then, if the Interim Adjustment Amount not disputed in good faith by Buyer (or, if Buyer fails to object to the Interim Adjustment Amount within the time period
specified above, the Interim Adjustment Amount) (the “Non-Disputed Interim Adjustment Amount”) is greater or less than the Non-Disputed Initial Adjustment Amount, then on the Interim Adjustment Date (as defined below), (1) to the extent
that the Non-Disputed Interim Adjustment Amount exceeds the Non-Disputed Initial Adjustment Amount, Buyer shall pay to Seller the amount of such excess, and (2) to the extent that the Non-Disputed Interim Adjustment Amount is less than the
Non-Disputed Initial Adjustment Amount, Seller shall pay to Buyer the amount of such deficiency. Any amount paid pursuant to this Section 3.3(d)(ii)(B) shall be paid with interest calculated at the prime rate of 

  

 17 

 
the JP Morgan Chase Bank in effect on the Closing Date and applicable to the period from the Closing Date to the date of payment, and shall be paid by Wire
Transfer. The “Interim Adjustment Date” as used herein means (x) to the extent that Buyer does not dispute the Interim Adjustment Amount contained in the Post-Closing Adjustment Certificate pursuant to Section 3.3(d)(ii)(A), the twentieth
(20th) day after Buyer’s receipt of the Post-Closing Adjustment Certificate, or (y) to the extent that Buyer
disputes the Interim Adjustment Amount contained in the Post-Closing Adjustment Certificate pursuant to Section 3.3(d)(ii)(A), the tenth (10th) day following the expiration of the Buyer Objection Period. Any good faith dispute with respect to the Interim Adjustment Amount shall be resolved in connection with the adjustment provided in Section 3.3(d)(iii)
below. 
  
 (iii) Within ten (10) days of
Buyer’s delivery to Seller of the Closing Date Financial Statements pursuant to Section 3.4 below, together with the working papers, schedules and other documentation which were used or prepared in producing the Closing Date Financial
Statements and which are reasonably necessary for Seller to prepare the Final Adjustment Certificate (as defined below), Seller shall deliver to Buyer the final calculation (the “Final Adjustment Certificate”), as of the Closing Date, of
the Upward Capital Expenditure Adjustment or Downward Capital Expenditure Adjustment (if any), the Indebtedness Adjustment (if any), the Upward Working Capital Adjustment or Downward Working Capital Adjustment (if any) and the cumulative net
adjustment amount as a result of the foregoing adjustments, all as determined based on the Closing Date Financial Statements (the “Final Adjustment Amount”). If the Final Adjustment Amount is greater or less than the Net Non-Disputed
Adjustment Amount, then, within five (5) Business Days after the date of the Final Adjustment Certificate, (1) to the extent that the Final Adjustment Amount exceeds the Net Non-Disputed Adjustment Amount, Buyer shall pay to Seller the amount of
such excess, and (2) to the extent that the Final Adjustment Amount is less than the Net Non-Disputed Adjustment Amount, Seller shall pay to Buyer the amount of such deficiency. Any amount paid pursuant to this Section 3.3(d)(iii) shall be paid with
interest calculated at the prime rate of the JP Morgan Chase Bank in effect on the Closing Date and applicable to the period from the Closing Date to the date of payment, and shall be paid by Wire 

  

 18 

 
Transfer. The Final Adjustment Amount, as determined in accordance with this Section 3.3(d)(iii) based on the Closing Financial Statements, shall be final,
binding and conclusive on Buyer and Seller, including with respect to any remaining disputed adjustment amounts. 
  
 Section 3.4 Closing Date Financial Statements. Promptly after the date hereof, Seller shall cause the Company to retain an independent accounting
firm (the “Financial Statements Accounting Firm”) to commence the work that will be necessary to prepare and deliver the Closing Date Financial Statements. After the Closing Date, Buyer shall cause the Company to cause the Financial
Statements Accounting Firm to prepare and deliver to Seller the Closing Date Financial Statements within forty-five (45) days after Closing. Seller shall cooperate with Buyer, to the extent reasonably requested by Buyer, in connection with
Buyer’s performance of its obligations under this Section 3.4. All amounts payable to the Financial Statements Accounting Firm shall be paid by Buyer and, to the extent that any such amounts are required to be paid by the Company prior to the
Closing or by Seller at any time, Buyer shall promptly reimburse the Company or Seller, as applicable, for such payments. 
  
 ARTICLE IV 
 REPRESENTATIONS AND
WARRANTIES OF SELLER 
  
 Except as otherwise set forth in a
Schedule or an Updated Schedule hereto or in the Stock Options List, the Contracts List or the Insurance and Bond List, Seller hereby represents and warrants to Buyer as of the date hereof: 
  
 Section 4.1 Organization and Related Matters. 
  
 (a) The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of New York and has the corporate power and authority to carry on its business as it is now being conducted and to own, lease or operate all of its properties and assets, and is duly licensed or qualified to
do business and is in good standing in each state in which the nature of the business there conducted by it or the character of the assets there owned by it makes such qualification or licensing necessary, except where the failure to be so 

  

 19 

 
qualified or licensed would not, individually or in the aggregate, have a Material Adverse Effect. 
  
 (b) Seller is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of New York and has the corporate power and authority to own the Shares. 
  
 (c) Except as set forth on Schedule 4.1(c), the minute books of the Company and the Subsidiaries contain accurate records of all meetings and accurately
reflect all other actions taken by the stockholders, Boards of Directors and all committees of the Boards of Directors of the Company and the Subsidiaries, except where the failure to keep such records or accurately reflect all actions taken would
not, individually or in the aggregate, have a material effect on the Company and the Subsidiaries, taken as a whole. Except as set forth on Schedule 4.1(c), Seller has made complete and accurate copies of all such minute books and the stock register
of the Company and each Subsidiary available for review by Buyer. 
  
 Section 4.2 Subsidiaries. 
  
 (a) Except as set
forth on Schedule 4.2, all of the outstanding shares of capital stock of, and limited liability member interests in, the Subsidiaries, as applicable, are owned beneficially and of record, directly or indirectly, by the Company, free and clear of any
Encumbrances. Except as set forth on Schedule 4.2, each Subsidiary is duly organized, validly existing and in good standing under the laws of the state of its organization, and, as applicable, has the corporate or limited liability company power and
authority to carry on its business as now being conducted and to own, lease and operate all of its properties and assets. Each Subsidiary is duly licensed or qualified to do business and is in good standing in each state in which the nature of the
business there conducted by it or the character of the assets there owned by it makes such qualification or licensing necessary, except where the failure to be so qualified or licensed would not, individually or in the aggregate, have a Material
Adverse Effect. 
  
 (b) Except as set forth on Schedule 4.2, and
except for the Subsidiaries, there are no corporations, limited liability companies, partnerships, or other entities in 

  

 20 

 
which the Company owns, of record or beneficially, any direct or indirect equity interest or any right (contingent or otherwise) to acquire the same.

  
 Section 4.3 Authority; No Violation. 
  
 (a) Seller has full corporate power and authority to execute and deliver this
Agreement, the Security Agreements and the other documents required to be executed and delivered by Seller in connection herewith and therewith (collectively, the “Seller Transaction Documents”) and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement and the other Seller Transaction Documents and the consummation of the transactions contemplated hereby and thereby have been duly and validly approved by all requisite
corporate action on the part of Seller, and no other corporate proceedings on the part of Seller are necessary to approve this Agreement and the other Seller Transaction Documents and to consummate the transactions contemplated hereby or thereby.
This Agreement and each other Seller Transaction Document has been duly and validly executed and delivered by Seller and (assuming the due authorization, execution and delivery of this Agreement and each other Seller Transaction Document by the
other party or parties thereto) constitute the valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms. 
  
 (b) Except as set forth on Schedule 4.3(b) and assuming that the filings, notifications, authorizations, consents, orders and/or approvals referred to in
Section 4.4 are, as applicable, duly made and/or obtained, neither the execution and delivery of this Agreement or any other Seller Transaction Document by Seller, nor the consummation by Seller of the transactions contemplated hereby or thereby to
be performed by it, nor compliance by Seller with any of the terms or provisions hereof or thereof, will (i) violate any provision of the Certificate of Incorporation or Bylaws of Seller, the Company, or any Subsidiary, or (ii) (A) violate any
applicable law with respect to Seller, the Company, any Subsidiary, or any of their respective properties or assets, (B) result in the creation of any Encumbrance upon any of the Shares or upon any of the assets or properties of the Company or any
Subsidiary, or (C) violate, conflict with, result in a breach of any provision of, or constitute a default under, 

  

 21 

 
any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which Seller, the Company, or any
Subsidiary is a party, or by which Seller, the Company, or any Subsidiary or any of their respective properties or assets may be bound or affected, except for such violations, Encumbrances, conflicts, breaches or defaults which would not,
individually or in the aggregate, have a Material Adverse Effect. 
  
 Section 4.4 Consents and Approvals. Except for (i) the filings, notifications, authorizations, consents, orders or approvals listed in Schedule 4.4, and (ii) such other filings, notifications, authorizations, consents, orders or
approvals, the failure of which to make or obtain would not, individually or in the aggregate, have a Material Adverse Effect, no authorizations, consents, orders or approvals of or filings or notifications to any Governmental Authority or third
party are necessary in connection with the execution and delivery by Seller of this Agreement or any other Seller Transaction Document, and the consummation by Seller of the transactions contemplated hereby or thereby. For the avoidance of doubt,
Seller and Buyer specifically acknowledge and agree that Section 6.5, rather than this Section 4.4, governs their respective obligations with respect to making, obtaining and rendering cooperation in connection with the filings, notifications,
authorizations, consents, orders and/or approvals listed in Schedules 4.4 and 5.3. 
  
 Section 4.5 Stock Ownership. Seller owns beneficially and of record all of the Shares, free and clear of all Encumbrances. Except to the extent that any of the options set forth on the Stock Options List are
exercised during the Interim Period and, subject to the last sentence of Section 6.10(g), the Company is required to issue stock of the Company in connection therewith, upon consummation of the transactions contemplated hereby, Buyer will own all of
the issued and outstanding capital stock of the Company free and clear of all Encumbrances. Seller has the full and unrestricted power to sell, assign, transfer and deliver the Shares to Buyer upon the terms and subject to the conditions of this
Agreement free and clear of Encumbrances. Except to the extent that any of the options set forth on the Stock Options List are exercised during the Interim Period and, subject to the last sentence of Section 6.10(g), the Company is required to issue
stock of 

  

 22 

 
the Company in connection therewith, there are no shares of capital stock of the Company issued or outstanding other than the Shares. All of the Shares are
duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights. By letter of even date herewith, Seller provided to Buyer a list (the “Stock Options List”) setting forth, as of the date hereof, (i) the names
of all Persons who have been granted options to purchase capital stock of the Company pursuant to the Company Option Plan (other than those options which have terminated, expired or been forfeited), (ii) the maximum number of shares of capital stock
of the Company subject to such options, (iii) the duration of such options, (iv) the minimum strike price of such options and (v) certain information pertaining to the vesting of options issued under the Company Option Plan. None of the options set
forth on the Stock Options List have been exercised as of the date hereof. Except as set forth on the Stock Options List, there is no outstanding option, warrant, right, subscription, call, unsatisfied preemptive right, convertible or exchangeable
security, or other agreement or right of any kind to purchase or otherwise acquire any capital stock of the Company. Except as set forth on Schedule 4.5, all of the issued and outstanding shares of capital stock of, and limited liability member
interests in, the Subsidiaries, as applicable, are duly authorized, validly issued, fully paid, nonassessable and free of any preemptive rights, and are owned beneficially and of record by the Company or another of the Subsidiaries, free and clear
of all Encumbrances. Except as set forth on Schedule 4.5, there is no outstanding option, warrant, right, subscription, call, unsatisfied preemptive right, convertible or exchangeable security, or other agreement or right of any kind to purchase or
otherwise acquire, in each case from the Company or any Subsidiary, any capital stock of, or limited liability member interests in any Subsidiary, as applicable. Except as set forth on Schedule 4.5, there is no outstanding security of any kind
convertible into or exchangeable for the capital stock of, or limited liability member interests in, any Subsidiary, as applicable, and there is no outstanding contract or other agreement of Seller, the Company, or any Subsidiary to purchase, redeem
or otherwise acquire any outstanding shares of capital stock of, or limited liability member interests in, the Company or any Subsidiary, as applicable. 
  

 23 

 Section 4.6 Financial Statements. 
  
 (a) Seller has previously furnished Buyer with true and correct copies of audited consolidated financial statements for the
Company and the Subsidiaries as of and for the years ended December 31, 2003, 2002 and 2001 (collectively, the “Company GAAP Financial Statements”) and interim unaudited consolidated financial statements for the Company and the
Subsidiaries as of and for the quarterly period ended June 30, 2004 (the “Interim Financial Statements”). Each of the balance sheets included in the Company GAAP Financial Statements fairly presents in all material respects the financial
position of the Company and the Subsidiaries as of its date and each of the statements of operations and cash flow statements included in the Company GAAP Financial Statements fairly presents in all material respects the results of operations and
cash flows of the Company and the Subsidiaries for the period therein set forth, in each case in accordance with GAAP applied on a consistent basis (except as may be disclosed in the notes thereto and except as set forth on Schedule 4.6). Except as
set forth on Schedule 4.6, the Interim Financial Statements were prepared in a manner consistent with that employed in the Company GAAP Financial Statements. The Interim Financial Statements do not contain footnote disclosures and are subject to
normal recurring year-end adjustments, but otherwise fairly present in all material respects the financial position and results of operations of the Company and the Subsidiaries for the periods and as of the dates therein set forth. 
  
 (b) Except as set forth on Schedule 4.6, the books of account and other
financial records of the Company and each Subsidiary: (i) reflect all material items of income and expense and all material assets and liabilities required to be reflected therein in accordance with GAAP applied on a basis consistent with the past
practices of the Company and the Subsidiaries or statutory accounting principles, as applicable, (ii) are in all material respects complete and correct and do not contain or reflect any material inaccuracies or discrepancies, and (iii) have been
maintained in accordance with good business, accounting and actuarial practices, as applicable. 
  
 Section 4.7 No Other Broker. Other than Morgan Stanley & Co. Incorporated, the fees and expenses of which will be paid by Seller, no broker,
finder or similar 

  

 24 

 
intermediary has acted for or on behalf of Seller or the Company or the Subsidiaries, or is entitled to any broker’s, finder’s or similar fee or
other commission from Seller, the Company or the Subsidiaries, in connection with this Agreement or the transactions contemplated hereby. 
  
 Section 4.8 Legal Proceedings. Except as set forth on Schedule 4.8, there are no pending, and no officer of the Company has received any written
notice threatening any, actions, investigations or proceedings against or otherwise affecting the Company or any Subsidiary or any of their respective properties or assets, or challenging the validity or propriety of the transactions contemplated by
this Agreement, and there is no injunction, order, judgment or decree imposed upon the Company or any Subsidiary, or any of their respective properties or assets. 
  
 Section 4.9 No Undisclosed Liabilities. Except for (i) those liabilities or items set forth on Schedule 4.9, (ii)
those liabilities that are reflected or reserved against on the Company GAAP Financial Statements or the Interim Financial Statements, and (iii) liabilities incurred since June 30, 2004 in the ordinary course of business consistent with past
practice, no liabilities have been incurred by the Company or the Subsidiaries other than those that would not, individually or in the aggregate, require payments in excess of $120,000. 
  
 Section 4.10 Compliance with Applicable Law. 
  
 (a) Except as set forth on Schedule 4.10, each of the Company and the Subsidiaries holds in full force and effect all
material licenses, franchises, permits and authorizations, other than Environmental Permits (which are addressed solely in Section 4.18), (“Permits”) necessary for the lawful ownership and use of their respective properties and assets and
the conduct of their respective businesses (as currently conducted) under applicable laws relating to the Company and the Subsidiaries, and there has been no material violation of any Permit nor has Seller, the Company or any Subsidiary received
written notice asserting any such violation. 
  
 (b) Except as set
forth on Schedule 4.10, each of the Company and the Subsidiaries is in compliance in all material respects with each applicable law relating to it or any of its assets, properties or operations. 
  

 25 

 Section 4.11 Absence of Certain Changes. Except (i) as set forth on Schedule 4.11, (ii) as
reflected on the Company GAAP Financial Statements or the Interim Financial Statements, (iii) as otherwise contemplated or permitted by this Agreement, including Section 6.1 hereof, or (iv) as otherwise approved by the prior written consent of
Buyer, since December 31, 2003, the Company and the Subsidiaries, taken as a whole, (x) have conducted their business in the ordinary course of business consistent with past practice and (y) have not: 
  

	 	(a)	taken any action, or failed to take any action, that has caused the assets or properties (whether tangible or intangible) of the Company or any Subsidiary to be subjected to any
Encumbrance; 

  

	 	(b)	made any change in its fiscal year, except as required by law, GAAP or statutory accounting practices of its state of domicile or made any change in its accounting methods,
principles or practices or any change in depreciation or amortization policies or rates therefor adopted by it; 

  

	 	(c)	issued, sold, pledged, encumbered or disposed of, any of its capital stock, notes, bonds or other securities, or any option, warrant or other right to acquire the same;

  

	 	(d)	split, combined or reclassified any shares of capital stock, or redeemed, repurchased or otherwise acquired any of its capital stock; 

  

	 	(e)	 merged with, entered into a consolidation with or acquired or sold an interest of 5% or more in any Person or acquired or sold, in one transaction or a series of
related transactions, a substantial portion of the assets or business of any Person or any division or line of business thereof, or otherwise acquired or sold any assets or securities (other than fixed maturity 

  

 26 

	 	 
securities, cash and short-term investments) with an aggregate value in excess of $150,000 other than in the ordinary course of the Company’s business
consistent with past practice and other than the granting of any indefeasible rights to use (“IRUs”), any IRU calls or any calls on equipment; 

  

	 	(f)	except as required by law, rule or regulation or any collective bargaining agreement and except for increases in the ordinary course of business consistent with past practice,
granted or committed to any increase, or announced any increase, in the wages, salaries, compensation, bonuses, incentives, pension or other benefits payable to any of its senior officers who in the preceding twelve (12) months received compensation
in excess of $200,000, or any director, including any increase or change pursuant to any Benefit Plans; 

  

	 	(g)	amended its charter or Bylaws (or other organizational documents), except as permitted under Section 6.12 hereof; 

  

	 	(h)	paid, discharged, settled or satisfied any claim, liability or obligation (absolute, accrued, asserted or unasserted, contingent or otherwise) except (i) where the amount that
remains to be paid after the Closing Date is $150,000 or less, (ii) for repayment of Indebtedness or (iii) for payment of contractual obligations (other than Indebtedness) when due in the ordinary course of business; 

  

	 	(i)	 renewed, amended, modified or terminated any of its contracts or arrangements, or assigned any of its rights, thereunder except (i) for such renewals, amendments,
modifications, terminations, or assignments, as well as the expiration of contracts or agreements, as may be effectuated by the terms of such contracts or arrangements without affirmative act by the Company or any of the Subsidiaries, or (ii) as may
have 

  

 27 

	 	 
been made in the ordinary course of business, or (iii) as would not materially alter any rights under such contract or arrangement in a manner unfavorable to
the Company or the Subsidiaries; 

  

	 	(j)	declared, set aside or paid any dividend or other distribution on or in respect of any shares of capital stock, other than dividends or distributions of available cash; or

  

	 	(k)	agreed, whether in writing or otherwise, to take any of the actions that Seller represents in this Section 4.11 have not been taken, except as expressly contemplated by this
Agreement. 

  
 Section 4.12 Technology and
Intellectual Property. 
  
 (a) Except as set forth on Schedule
4.12 and subject to the changes in the names of the Company and the Subsidiaries and to the reservation to Seller of the rights, title and interests described in Section 6.12, the Company or a Subsidiary owns or possesses, or has rights or licenses
to use, the patents, trademarks (including common law trademarks), service marks, copyrights (including any registrations, applications or continuations relating to any of the foregoing), trade names, technology, trade secrets, inventions, know-how
and computer programs which are necessary to carry on its business as currently conducted (each, an “Intellectual Property Right”), and, to the knowledge of Seller, neither the Company nor any Subsidiary has engaged in any infringement of
the intellectual property rights of others with respect to any such Intellectual Property Right other than any infringements that, in the aggregate, would not have a material effect on the conduct of the business of the Company and the Subsidiaries,
taken as a whole. Except as set forth on Schedule 4.12, subject to the changes in the names of the Company and the Subsidiaries and to the reservation to Seller of the rights, title and interests described in Section 6.12, and subject to the receipt
of any required consents or the delivery of any required notifications (as set forth on Schedule 4.4), the execution and delivery of this Agreement by Seller, and the consummation of the transactions contemplated hereby, will 

  

 28 

 
neither cause the Company or any Subsidiary to be in violation or default under any licenses, sublicenses or other agreements to which the Company or any
Subsidiary is a party and pursuant to which the Company or any Subsidiary is authorized to use any Intellectual Property Right, nor entitle any other party to any such license, sublicense or agreement to terminate such license, sublicense or
agreement. Schedule 4.12 sets forth a complete and correct list, as of the date hereof, of the trademarks that are used in the business as currently conducted by the Company or any Subsidiary and all registrations and applications for registration
of any Intellectual Property Rights. Except as set forth on Schedule 4.12, Seller has no knowledge of any infringement by third parties of the Intellectual Property Rights. 
  
 (b) Except as set forth on Schedule 4.12 and subject to the changes in the names of the Company and the Subsidiaries and to
the reservation to Seller of the rights, title and interests described in Section 6.12, to the knowledge of Seller, the use of any Intellectual Property Right in the business as currently conducted by the Company or any Subsidiary does not breach,
violate or infringe any intellectual property rights of any third party and (except for the payment of computer software or other licensing fees) does not require any payment for the use of any patent, trade name, service mark, trade secret,
trademark, copyright or other intellectual property right or technology owned by any third party, other than any such breaches, violations, infringements or payments that, in the aggregate, would not have a material effect on the conduct of the
business of the Company and the Subsidiaries, taken as a whole. 
  
 Section 4.13 ERISA; Benefit Plans. 
  
 (a)
Schedule 4.13(a) sets forth a list, as of the date of this Agreement, of all material deferred compensation, retirement and pension plans and all material bonus plans, plans providing for stock options, severance, change in control, section 125
cafeteria, dependent care, medical care, insurance, employee assistance, education assistance or tuition assistance plans or programs, employee welfare benefit plans (as defined in Section 3(1) of ERISA) and any currently effective executive
compensation or severance agreements, written or otherwise, of Seller or Seller’s ERISA Affiliates as defined in 

  

 29 

 
section 414 of the Code (“ERISA Affiliates”) that are not maintained or sponsored by the Company or any of the Subsidiaries but (i) in which
employees of the Company or any of the Subsidiaries (collectively, “Company Employees”) participate or (ii) to which the Company or any of the Subsidiaries makes contributions with respect to certain Company Employees, or in which the
Company or any of the Subsidiaries is a participating employer (collectively, the “Seller’s Benefit Plans”). Although the rights of Company Employees to participate further in Seller’s Benefit Plans may be terminated in the
manner specified under Section 6.10, none of the Seller’s Benefit Plans will be terminated as a result of this Agreement. 
  
 (b) Schedule 4.13(b) sets forth a list, as of the date of this Agreement, of all material deferred compensation, retirement and pension plans and all
material bonus plans, plans providing for stock options, severance, change in control, section 125 cafeteria, dependent care, medical care, insurance, employee assistance, education assistance or tuition assistance plans or programs and employee
welfare benefit plans (as defined in Section 3(1) of ERISA) maintained or sponsored by the Company or any of the Subsidiaries with respect to Company Employees, as well as the written vacation/sick policy of the Company and the Subsidiaries, and any
executive employment, compensation or severance agreement, written or otherwise, that was sponsored, entered into, or maintained by the Company or any of the Subsidiaries during the six year period ending on the date of this Agreement and for which
the Company or any Subsidiary will incur any liability after the Closing Date (the “Company Employee Plans” and, together with the Seller’s Benefit Plans, the “Benefit Plans”).  
  
 (c) Copies of all Benefit Plans concerning which Buyer or Buyer’s
Affiliates will incur any liability after the Closing Date have been made available to Buyer. To the knowledge of Seller, each Benefit Plan is in compliance in all material respects with the presently applicable provisions of ERISA, the Code and
other applicable laws, except for such failures to fulfill such obligations or comply with such provisions which would not, individually or in the aggregate, be reasonably expected to have a Material Adverse Effect. 
  

 30 

 (d) None of the Company Employee Plans are employee pension benefit plans within the meaning of Section
3(2) of ERISA. 
  
 (e) As of the date of this Agreement, no
more than three Company Employees, each of whom formerly was employed by CECONY, participate in the Consolidated Edison Retirement Plan. Company Employees participate in the Consolidated Edison Thrift Savings Plan (401(k)Plan). Company Employees
will no longer be eligible to receive benefit accruals or contributions under the Consolidated Edison Retirement Plan or the Consolidated Edison Thrift Savings Plan after the Closing Date.  
  
 (f) Neither the Company, the Subsidiaries, the Seller, nor any ERISA
Affiliate participates or has participated in a Multiemployer Plan (as such term is defined in Section 3(37) of ERISA), nor has the Seller or any ERISA Affiliate ever made a complete or partial withdrawal from a Multiemployer Plan (as such term is
defined in Section 3(37) of ERISA) resulting in “withdrawal liability” (as such term is defined in Section 4201 of ERISA), without regard to any subsequent waiver or reduction under Section 4207 or 4208 of ERISA.  
  
 (g) Contributions that are required to be made by the Seller, the Company,
the Subsidiaries or any ERISA Affiliate pursuant to either any Seller Benefits Plan or any Company Employee Plan pursuant to Section 412 of the Code, or pursuant to a collective bargaining agreement, if applicable, have been made on or before their
respective due dates and a reasonable amount has been accrued for any such contributions for the current plan year. 
  
 (h) Seller’s Affiliate, CECONY, currently maintains a retiree health program for individuals who are participants in the Consolidated Edison
Retirement Plan and who meet certain other eligibility requirements. As of the date of this Agreement, there are no more than three Company Employees who are participants in the Consolidated Edison Retirement Plan due to their prior employment with
CECONY and who would be eligible to receive retiree health benefits if the other eligibility requirements for such benefits were satisfied, but for whom such other eligibility requirements will not be satisfied if the Closing occurs before the date
on which either Buyer or Seller may terminate this Agreement pursuant to Section 10.1(a)(iii). 

  

 31 

 
In any event, neither the Company nor the Subsidiaries will be obligated to make any payments to this retiree health plan with respect to Company Employees
after the Closing Date. Other than (i) the potential retiree medical benefits described in the first sentence of this paragraph (h), (ii) the right to obtain continued health coverage under applicable COBRA provisions, and (iii) the right of certain
employees pursuant to the Company CIC Plan for a limited period of time after the Closing Date as described in such Company CIC Plan in the medical plan maintained by the Company or the Subsidiaries after the Closing Date, neither the Company nor
the Subsidiaries have any plans or arrangements that provide for medical coverage after termination of employment with the Company.  
  
 (i) Other than routine claims for benefits, there are no claims pending or, to the knowledge of Seller, threatened, against any Company Employee Plan or
against the assets of any Company Employee Plan or of the Company with respect to any Company Employee Plan, nor are there any current or, to the knowledge of Seller, threatened, liens on the assets of any Company Employee Plan or of the Company
with respect to any Company Employee Plan. To the knowledge of Seller, the Company and the Subsidiaries have performed all material obligations required to be performed by them under the Company Employee Plans.  
  
 Section 4.14 Taxes. Except as set forth on Schedule 4.14: 

 
 (a) The Company (and any affiliated group of which the Company is a member
(the “Affiliated Group”)) and the Subsidiaries have timely filed with the appropriate taxing authorities all Tax Returns required to be filed (taking into account all valid extensions) and all such Tax Returns are complete and accurate.
The Company and the Subsidiaries have paid on a timely basis all Taxes that were due and payable and each member of the Affiliated Group has paid all Taxes for which the Company or any Subsidiary may be liable that were due and payable with respect
to all affiliated periods. The unpaid Taxes of the Company and the Subsidiaries for tax periods through June 30, 2004 do not exceed the accruals and reserves for Taxes (excluding accruals and reserves for deferred Taxes established to reflect timing
differences between book and Tax income) set forth on the Interim Financial Statements; 
  

 32 

 (b) All Taxes shown in the Tax Returns referred to in Section 4.14(a) that are due and payable by the
Company and the Subsidiaries before the date hereof have been timely paid, except such Taxes, if any, as are being contested in good faith and as to which adequate reserves have been provided in the relevant financial statements; 
  
 (c) There are no Encumbrances on any of the assets of the Company or any
Subsidiary that arose in connection with any failure to pay any Taxes (other than Taxes that are not due as of the date hereof); 
  
 (d) The Company and the Subsidiaries have withheld and paid all Taxes required to have been withheld and paid in connection with amounts paid or owing to
any employee, independent contractor, creditor, stockholder or other third party; 
  
 (e) No audit or other administrative or court proceeding exists or has been initiated with regard to any Tax Returns of the Company or any Subsidiary, and neither the Company nor any Subsidiary has received any notice
that any such material audit or other administrative or court proceeding is pending or threatened with respect to any Tax Return filed by or with respect to the Company or any Subsidiary; 
  
 (f) Neither the Company nor any Subsidiary has requested an extension of time within which to file any Tax Return in respect
of any taxable year which has subsequently not been filed and no outstanding waivers or comparable consents regarding the application of the statute of limitations with respect to any Taxes or Tax Returns has been given by or on behalf of the
Company or any Subsidiary; 
  
 (g) For purposes of determining
whether Seller has satisfied the conditions to Closing set forth in Section 8.1(a), but not for purposes of determining Seller’s indemnity obligations under Section 7.1(a), any representation or warranty with respect to Taxes contained in this
Section 4.14 shall be deemed to be accurate unless an inaccuracy contained therein would have, individually or in the aggregate, a Material Adverse Effect; 
  
 (h) Neither the Company nor any Subsidiary: (i) is a “consenting corporation” within the meaning of Section 341(f) of the Code, and none of the
assets of the Company 

  

 33 

 
or the Subsidiaries are subject to an election under Section 341(f) of the Code; (ii) has been a United States real property holding corporation within the
meaning of Section 897(c)(2) of the Code during the applicable period specified in Section 897(c)(l)(A)(ii) of the Code; or (iii) has made any payments, is obligated to make any payments, or is a party to any agreement that could obligate it to make
any payments that would be treated as an “excess parachute payment” under Section 280G of the Code (without regard to Section 280G(b)(4) of the Code); and 
  
 (i) There is no limitation on the utilization by either the Company or any Subsidiary of its net operating losses, built-in
losses, Tax credits, or similar items under Sections 382, 383, or 384 of the Code or comparable provisions of state law (other than any such limitation arising as a result of the consummation of the transactions contemplated by this
Agreement). 
  
 Section 4.15 Contracts. 

 
 (a) By letter of even date herewith, Seller provided to Buyer a complete
and accurate list (the “Contracts List”) setting forth, as of the date hereof, (i) all contracts pursuant to which (A) the Company or any Subsidiary is a party and (B) the Company or any Subsidiary has non-contingent obligations to the
contract counterparty in excess of $100,000 per calendar year, (ii) all contracts pursuant to which (A) the Company or any Subsidiary is a party and (B) the contract counterparty has non-contingent obligations to the Company or any Subsidiary in
excess of $100,000 per calendar year, (iii) all contracts that limit or purport to limit the Company or any Subsidiary in any line of business or with any Person or in any geographic area and (iv) all contracts and agreements relating to
Indebtedness of the Company or any Subsidiary, in each case other than Leases and Necessary Leases (the contracts set forth on the Contracts List are referred to herein collectively as the “Contracts”). Except as set forth on the Contracts
List, neither Seller, the Company, nor any Subsidiary has received written notice of a cancellation of or an intent to cancel any Contract. 
  
 (b) Except as set forth on the Contracts List, assuming the due authorization, execution and delivery by the other parties thereto, each Contract is
legal, valid, binding, and enforceable against the other parties thereto, 

  

 34 

 
is in full force and effect, and will not cease to be in full force and effect as a result of the consummation of the transactions contemplated by this
Agreement, nor will the consummation of the transactions contemplated by this Agreement constitute a breach or default under such Contract. 
  
 (c) Except as set forth on the Contracts List, (i) no officer of the Company has received any notice of any breach under any Contract, other than such
breaches or defaults by the Company or any Subsidiary which would cost less than $120,000 in the aggregate for the Company or any Subsidiary to cure, and (ii) to the knowledge of Seller, no other party to any Contract is in breach thereof or default
thereunder. 
  
 (d) Schedule 4.15(d) sets forth a complete and
accurate list of all Seller-Provided Indebtedness. 
  
 Section
4.16 Title to Assets. Except as set forth in Schedule 4.16 and except for Encumbrances reflected in the financial statements of the Company as of December 31, 2003 or June 30, 2004, the Company and the Subsidiaries have, as applicable, good
title to, or valid and subsisting leasehold interests in, all real and personal property and other assets on their books and reflected on the Company’s balance sheet at December 31, 2003 and June 30, 2004 included as part of the Company GAAP
Financial Statements and the Interim Financial Statements, respectively, or acquired in the ordinary course of business consistent with past practice since December 31, 2003 or June 30, 2004, as appropriate, which would have been required to be
reflected on such balance sheet if acquired on or prior to such date, other than assets which have been disposed of in the ordinary course of business consistent with past practice. None of the properties and assets of the Company or any Subsidiary
is subject to any Encumbrance, except for Encumbrances set forth on Schedule 4.16 or reflected in the financial statements of the Company as of December 31, 2003 or June 30, 2004. 
  
 Section 4.17 Transactions with Certain Persons. Except as set forth on Schedule 4.17, neither any officer, director
or employee of Seller, the Company or any Subsidiary, nor, to the knowledge of Seller, any officer, director or employee of any Affiliate of Seller, the Company or any Subsidiary, nor any member of any such 

  

 35 

 
Person’s immediate family, is now a party to any transaction with the Company or any Subsidiary, including any contract or other binding arrangement (i)
providing for the furnishing of services by such Person (except in such Person’s capacity as an officer, director, employee or consultant), (ii) providing for the rental of real or personal property from such Person, or (iii) otherwise
requiring payments (whether pursuant to indebtedness or otherwise) to such Person (other than for services as an officer, director, employee or consultant of Seller, the Company, any Subsidiary or any of their respective Affiliates). 
  
 Section 4.18 Environmental Laws. To the knowledge of Seller, except as
set forth on Schedule 4.18: (i) the Company and each Subsidiary is in material compliance with all applicable Environmental Laws, and, possess and is in material compliance with all Environmental Permits required under such laws for the conduct of
its business operations, (ii) there are no past events or conditions that would give rise to any material liability of the Company or any Subsidiary under any Environmental Law, (iii) there has been no release of hazardous materials at any property
owned, or operated by the Company or any Subsidiary now or in the past that would give rise to liability of the Company or any Subsidiary under any Environmental Law and (iv) no written notice, demand, request for information, citation or complaint
has been received by the Company or any Subsidiary from, and no action or proceeding is pending or threatened by, any Governmental Authority against the Company or any Subsidiary, with respect to any Environmental Law. 
  
 Section 4.19 Insurance Coverage. Seller shall provide to Buyer, by
letter of even date herewith and by a subsequent letter delivered on or prior to the Closing Date, a list (the “Insurance and Bond List”) setting forth, as of the date hereof and as of the Closing Date, respectively, (i) the insurance
carrier, policy number, limits, expiration date and determinant of coverage (claims made or occurrence) of the insurance covering the assets, business, equipment, properties, operations, employees, officers or directors of the Company or any
Subsidiary, which insurance, subject to expiration of the insurance policies in accordance with their terms and the actions contemplated by Section 6.19, is in full force and effect, and (ii) the bond number, bond amount and term of the 

  

 36 

 
surety bonds under which the Company or any Subsidiary is the principal. 
  
 Section 4.20 Real Property. 
  

(a) Neither the Company nor any Subsidiary owns any real property. 
  
 (b) Schedule 4.20(b) lists all leases of, and licenses for, real property to which the Company or any Subsidiary is a party
(collectively, the “Leases”). 
  
 (c) Except as set
forth on Schedule 4.20(c), with respect to any Lease set forth on Schedule 4.20(b) that is necessary for the Company and the Subsidiaries to perform their respective obligations under the Contracts (collectively, the “Necessary Leases”):
(i) such Necessary Lease is legal, valid, binding, enforceable and in full force and effect and represents the entire agreement between the respective landlord and tenant with respect to such property; (ii) subject to the receipt of any consent or
the delivery of any notification required under such Necessary Lease (all of which are set forth on Schedule 4.4), such Necessary Lease will not cease to be legal, valid, binding, enforceable and in full force and effect on terms identical to those
currently in effect (except to the extent any such Necessary Lease is amended in connection with the transactions contemplated by this Agreement) as a result of the consummation of the transactions contemplated by this Agreement; (iii) subject to
the receipt of any consent or the delivery of any notification required under such Necessary Lease (all of which are set forth on Schedule 4.4), the consummation of the transactions contemplated by this Agreement will not constitute a breach or
default under such Necessary Lease or otherwise give the landlord a right to terminate such Necessary Lease; (iv) neither Seller, the Company nor any Subsidiary has received any notice of cancellation or termination under such Necessary Lease and no
lessor has any right of termination or cancellation under such Necessary Lease except in connection with the default of Seller, the Company or a Subsidiary, as applicable, thereunder; (v) neither Seller, the Company nor any Subsidiary has any notice
of a breach or default under such Necessary Lease, which breach or default has not been cured; (vi) neither Seller, the Company nor any Subsidiary has granted to any other Person any rights, adverse or 

  

 37 

 
otherwise, under such Necessary Lease; (vii) neither Seller, the Company nor any Subsidiary, nor, to the knowledge of Seller, any other party to such
Necessary Lease, is in breach or default in any material respect, and, to the knowledge of Seller, no event has occurred that, with notice or lapse of time would constitute such a breach or default or permit termination, modification or acceleration
under such Necessary Lease; and (viii) the rental set forth in such Necessary Lease is the actual rental being paid, and there are no separate agreements or understandings with respect to the same. 
  
 (d) To the knowledge of Seller, there are no condemnation proceedings or
eminent domain proceedings of any kind pending or threatened against any real property leased by the Company or any Subsidiary. 
  
 Section 4.21 Receivables. All receivables (whether notes, accounts or otherwise) of the Company and the Subsidiaries have been recorded in
accordance with GAAP. No discount from any receivable has been made or agreed to (other than contingency payment discounts or discounts based on early payment, in each case in the ordinary course of business consistent with past practice), and none
represents billings prior to actual sale of goods or provision of services, except to the extent that the contract or arrangement underlying a receivable contemplates billings or payment prior to actual sale of goods or provision of services.

  
 Section 4.22 Labor and Employee Relations. The Company
is not and no Subsidiary is a party to or bound by any collective bargaining agreement with any labor organization, group or association covering any of its employees, and, to the knowledge of Seller, there is no attempt to organize any employees of
the Company or any Subsidiary by any person, unit or group seeking to act as their bargaining agent. No union representation elections relating to Company Employees have been scheduled by any governmental agency or authority, no organizational
effort is being made with respect to any Company Employees, and there is no investigation of the Company or any Subsidiary employment policies or practices by any governmental agency or authority pending or threatened. Neither the Company nor any
Subsidiary is currently, and neither the Company nor any Subsidiary has been within the last three years, involved in labor negotiations with any unit or group 

  

 38 

 
seeking to become the bargaining unit for any Company Employees. Neither the Company nor any Subsidiary has experienced any work stoppages during the last
three years, and, to the knowledge of Seller, no work stoppage is planned. 
  
 Section 4.23 Certain Employees. Except as described on Schedule 4.23 and except for the Benefit Plans set forth on Schedule 4.13, no Company Employee has an employment agreement or understanding, whether oral
or written, with the Company or any Subsidiary which is not terminable on notice by the Company or any Subsidiary without cost or other liability to the Company or any Subsidiary. Except as otherwise set forth on Schedule 4.23, neither the Company
nor any Subsidiary has received any written notice from any person listed on Schedule 4.23 pursuant to which such person has indicated that he or she intends to terminate his or her employment or seek a material change in his or her duties or
status. Except as otherwise set forth on Schedule 4.23, no officer of the Company or of any of the Subsidiaries at the level of Vice President or above has notified the President of the Company that such officer intends to terminate his or her
employment. 
  
 Section 4.24 Tangible Properties. Seller
has made available for review by Buyer maps of the network which is owned or leased by the Company or the Subsidiaries and each segment thereof, which maps (“Network Maps”) are described in Schedule 4.24(a). Schedule 4.24(a) describes the
approximate number of route miles, fiber strand miles and manholes owned by the Company and the Subsidiaries on a combined basis and the approximate number of fiber strand miles and manholes that the Company and the Subsidiaries on a combined basis
lease, license or, pursuant to IRUs, use (collectively, the “Network Facilities”). The Network Facilities owned by the Company and the Subsidiaries are structurally sound and are in such operating condition and repair (given due account to
the age and length of use of the same, ordinary wear and tear excepted) as is reasonably required to conduct the business as it is currently conducted by the Company and the Subsidiaries and provide the services currently provided by the Company and
the Subsidiaries. The Network Facilities are sufficient to conduct the business as it is currently conducted by the Company and the Subsidiaries and provide the services currently provided by the Company and the Subsidiaries. Except as shown on
Schedule 4.24(a), the Company and each 

  

 39 

 
Subsidiary has good and marketable title free and clear of all Encumbrances to the Network Facilities owned by it. With respect to Network Facilities leased
by the Company and each Subsidiary as lessee, all leases, conditional sale contracts, franchises or licenses pursuant to which the Company and each Subsidiary may hold or use (or permit others to hold or use) such Network Facilities are valid and in
full force and effect, and there is not under any of such instruments any existing default or event of default or event which with notice or lapse of time or both would constitute such a default. By letter of even date herewith, Seller provided to
Buyer certain charts (the “Performance Statistic Charts”) reflecting certain performance criteria of the circuits over Network Facilities. Assuming there are no flaws or inaccuracies in the systems used to produce the information depicted
in the Performance Statistic Charts, the information depicted in the Performance Statistic Charts reflects the performance of the circuits over Network Facilities in the areas, during the time periods and subject to the fidelity limitations
indicated in such Performance Statistic Charts. To the knowledge of Seller, there are no flaws or inaccuracies in the systems used to produce the information depicted in the Performance Statistic Charts. 
  
 Section 4.25 Banks, Brokers and Proxies. Schedule 4.25 sets forth:

  
 (a) the name of each bank, investment manager, trust company
and stock or other broker with which the Company and each Subsidiary maintains an account or from which it borrows money; 
  
 (b) the names of all persons authorized by the Company and each Subsidiary to effect transactions therewith, or to have access to any safe deposit box or
vault; and 
  
 (c) all proxies and powers of attorney of the
Company and each Subsidiary or Seller in matters concerning the business or affairs of the Company and each Subsidiary and all agreements with third parties granting such third parties the authority to bind the Company or any Subsidiary. 

 

 40 

  
 ARTICLE V 

REPRESENTATIONS AND WARRANTIES OF BUYER 
  
 Buyer hereby represents and warrants to Seller as follows: 
  
 Section 5.1 Organization and Related Matters. Buyer is a corporation duly organized, validly existing and in good standing under the laws of the
State of Delaware. 
  
 Section 5.2 Authority; No Violation.

  
 (a) Buyer has full power and authority to execute and deliver
this Agreement, the Security Agreements, the Securities Purchase Documents, the Amendment to Credit Agreement and the other documents required to be executed and delivered by Buyer in connection herewith and therewith (collectively, the “Buyer
Transaction Documents”) and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the other Buyer Transaction Documents and the consummation of the transactions contemplated hereby and
thereby have been duly and validly approved by all requisite action on the part of Buyer, and no other proceedings on the part of Buyer are necessary to approve this Agreement and the other Buyer Transaction Documents and to consummate the
transactions contemplated hereby and thereby. This Agreement and each other Buyer Transaction Document has been duly and validly executed and delivered by Buyer and (assuming the due authorization, execution and delivery of this Agreement by Seller
and each other Buyer Transaction Document by the other party or parties thereto) constitute the valid and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms. 
  
 (b) Assuming that the filings, notifications, authorizations, consents,
orders and/or approvals referred to in Section 5.3 are, as applicable, duly made and/or obtained, neither the execution and delivery of this Agreement or any other Buyer Transaction Document by Buyer, nor the consummation by Buyer of the
transactions contemplated hereby or thereby to be performed by it (including, to the extent that the filings, notifications, authorizations, consents, orders and/or approvals referred to in the Securities Purchase 

  

 41 

 
Agreement as being necessary for the execution, delivery and consummation by Buyer of the transactions contemplated by the Securities Purchase Agreement are,
as applicable, duly made or obtained, the amendment and restatement of the SDS Warrants (as defined in the Securities Purchase Agreement), the issuance of the Units (as defined in the Securities Purchase Agreement), and the issuance and reservation
for issuance of the Conversion Shares (as defined in the Securities Purchase Agreement) and the Warrant Shares (as defined in the Securities Purchase Agreement)), nor compliance by Buyer with any of the terms or provisions hereof or thereof, will
(i) violate any provision of the Certificate of Incorporation or Bylaws or other organizational documents of Buyer, or (ii) (A) violate any applicable law with respect to Buyer or any of its properties or assets (including U.S. federal and state
securities laws, rules and regulations and rules and regulations of any exchange, over-the-counter, and any other securities self-regulatory organizations to which either Buyer or its subsidiaries are subject), or (B) violate, conflict with, result
in a breach of any provision of, or constitute a default under, any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which Buyer is a party, or by which Buyer or any of its properties or
assets, may be bound or affected, except for such violations, conflicts, breaches or defaults which would not, individually or in the aggregate, prevent or materially delay the consummation of the transactions contemplated by this Agreement or the
other Buyer Transaction Documents or the performance by Buyer of any of its obligations hereunder or thereunder. 
  
 Section 5.3 Consents and Approvals. Except for (i) the filings, notifications, authorizations, consents, orders or approvals listed in Schedule
5.3, and (ii) such other filings, notifications, authorizations, consents, orders or approvals, the failure of which to make or obtain would not, individually or in the aggregate, prevent or materially delay the consummation of the transactions
contemplated by this Agreement or the performance by Buyer of any of its obligations pursuant to this Agreement, no authorizations, consents, orders or approvals of or filings or notifications to any Governmental Authority or third party are
necessary in connection with the execution and delivery by Buyer of this Agreement or any other Buyer Transaction Document, and the consummation by Buyer of the transactions contemplated hereby or thereby. For the avoidance of doubt, Seller and
Buyer specifically acknowledge and agree that Section 6.5, rather than this 

  

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Section 5.3, governs their respective obligations with respect to making, obtaining and rendering cooperation in connection with the filings, notifications,
authorizations, consents, orders and/or approvals listed in Schedules 4.4 and 5.3. 
  
 Section 5.4 Legal Proceedings. Buyer is not a party to any, and there are no pending or, to Buyer’s knowledge, threatened, actions or proceedings against or otherwise affecting Buyer or its properties or
assets or challenging the validity or propriety of the transactions contemplated by this Agreement or any other Buyer Transaction Document which, if adversely determined, would, individually or in the aggregate, prevent or materially delay the
consummation of the transactions contemplated by this Agreement or the performance by Buyer of any of its obligations pursuant to this Agreement, and there is no injunction, order, judgment, decree or regulatory restriction imposed upon Buyer or its
properties or assets which would, individually or in the aggregate, prevent or materially delay the performance by Buyer of any of its obligations pursuant to this Agreement. 
  
 Section 5.5 Investment Intent of Buyer. The Shares to be acquired under this Agreement will be acquired by Buyer for
its own account and not for the purpose of a distribution. Buyer confirms that it has been afforded the opportunity to ask questions and receive answers regarding the Company and the Subsidiaries and has reviewed the data and information it
requested from Seller and the Company in connection with this Agreement. Buyer will refrain from transferring or otherwise disposing of any of the Shares acquired by it, or any interest therein, in such manner as to violate any registration
provision of the Securities Act of 1933, as amended, or any applicable state securities law regulating the disposition thereof. Buyer agrees that the certificates representing the Shares may bear legends to the effect that the Shares have not been
registered under the Securities Act of 1933, as amended, or such other state securities laws, and that no interest therein may be transferred or otherwise disposed of in violation of the provisions thereof. 
  
 Section 5.6 No Other Broker. Other than Burnham Hill Partners, the
fees and expenses of which will be paid by Buyer, no broker, finder or similar intermediary has acted for or on behalf of Buyer or any Affiliate of Buyer, 

  

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or is entitled to any broker’s, finder’s or similar fee or other commission from Buyer, or any Affiliate of Buyer, in connection with this
Agreement or the transactions contemplated hereby. 
  
 Section 5.7
Financing. At the Closing, Buyer will have sufficient cash to consummate the transactions contemplated by this Agreement and the other Buyer Transaction Documents and to pay all related fees and expenses. Buyer acknowledges and agrees that
Buyer’s obligations hereunder are not contingent on Buyer obtaining any financing. 
  
 Section 5.8 Securities Purchase Documents. By letter of even date herewith, Buyer forwarded to Seller a true and complete copy of the final, executed Securities Purchase Agreement, dated as of December 10,
2004, by and among Buyer and each of the purchasers set forth on the execution pages thereof (the “Securities Purchase Agreement”), and all other documents executed and/or delivered in connection therewith (together with the Securities
Purchase Agreement, collectively, the “Securities Purchase Documents”). The Securities Purchase Agreement and all other Securities Purchase Documents are in full force and effect and constitute the entire agreement relating to the subject
matter of the Securities Purchase Agreement and each other Security Purchase Document. No provision of the Securities Purchase Agreement or any other Securities Purchase Document has been amended, supplemented or waived. The aggregate purchase price
payable to Buyer by the Purchasers (as defined in the Securities Purchase Agreement) under the Securities Purchase Agreement, including through any Subsequent Offering (as defined in the Securities Purchase Agreement), is at least equal to
$37,000,000. 
  
 Section 5.9 Amendment of Credit Facility.
On or before the date hereof, Buyer and the Buyer’s Lenders have entered into an amendment (the “Amendment to Credit Agreement”) to the Amended and Restated Credit Agreement, dated as of February 9, 2001, among Buyer and the
Buyer’s Lenders (the “Credit Agreement”), which amendment amended the Credit Agreement to the full extent necessary to permit Buyer to execute and deliver this Agreement and the Securities Purchase Documents and to consummate the
transactions contemplated hereby and thereby. The Amendment to Credit Agreement is in full force and effect 

  

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and no provision thereof has been amended, supplemented or waived. 
  

ARTICLE VI 
 COVENANTS

  
 Section 6.1 Conduct of Business. From the date
hereof until the earlier of the Closing Date or the termination of this Agreement pursuant to the terms hereof, (a) except for the events or circumstances described in clauses (ii) and (iii) of Section 4.11, and (b) except to the extent that Buyer
otherwise consents in writing, Seller shall cause each of the Company and the Subsidiaries to use commercially reasonable efforts to (i) conduct its business in the ordinary course of business, including (A) not declaring any dividends or making
distributions with respect to the Company other than any dividends or distributions of available cash prior to or at Closing and (B) entering into commitments with third parties with respect to Capital Expenditures to be made by the Company or any
of the Subsidiaries at any time after the date hereof (a “Capital Expenditure Commitment”) in a manner consistent with past practices (subject to the last sentence of this Section 6.1); (ii) preserve intact its present organization; (iii)
maintain in effect all material licenses, approvals, qualifications, registrations and authorizations necessary to carry on its business as currently conducted; and (iv) preserve existing relationships with its employees, customers, suppliers and
others having material business relationships with it; provided, however, that, notwithstanding anything to the contrary in this Agreement, Seller shall not be obligated (nor shall Seller be obligated to cause or permit the Company or
any Subsidiary to be obligated) to pay or provide any compensation or service to or at the direction of a Governmental Authority or other Person or otherwise incur any obligation to a Governmental Authority or other Person in order to satisfy
clauses (ii), (iii) or (iv) above (other than (x) as may be specifically set forth in the licenses, approvals, qualifications, registrations and authorizations at issue, (y) the payment of routine filing fees and (z) the payment of compensation and
provision of services to employees, customer, suppliers and others having material business relationships with the Company and the Subsidiaries pursuant to the terms of such employees’ employment and the contractual relationship between the
Company or any Subsidiary and such customers, suppliers and 

  

 45 

 
others); provided, further, however, that notwithstanding anything to the contrary in this Agreement, without the consent of Buyer,
Seller may, prior to Closing, cause Con Edison Communications, Inc. and/ or CEC Holding Member, Inc. to be merged into the Company or into the other and no breach of this Agreement, including any representation or warranty of Seller set forth
herein, shall occur as a result thereof. During the Interim Period, the Company and the Subsidiaries shall obtain Buyer’s prior written consent(which consent shall not be unreasonably withheld or delayed) before entering into any Capital
Expenditure Commitments in any calendar month, which, in the aggregate, exceed the Capital Expenditure Commitment Budget for such calendar month. 
  
 Section 6.2 Public Announcements. Buyer and Seller shall consult with each other before issuing, and provide each other the opportunity to review
and comment upon, any press release or other public statements with respect to the transactions contemplated by this Agreement, and shall not issue any such press release or make any such public statement prior to such consultation and without the
prior written consent of the other party, except as may be required by applicable law or court process or by obligations pursuant to any listing agreement with any national securities exchange (provided, however, that the initial press
release of each of Buyer and Seller with respect to the announcement of this Agreement and transactions contemplated thereby shall be in the form mutually agreed upon in advance by Buyer and Seller). 
  
 Section 6.3 Expenses. Regardless of whether any or all of the
transactions contemplated by this Agreement are consummated, and except as otherwise expressly provided herein, Buyer and Seller shall each bear its respective direct and indirect expenses incurred in connection with the negotiation and preparation
of this Agreement and the consummation of the transactions contemplated hereby, and Seller shall be responsible for all out-of-pocket expenses owed to third parties incurred by the Company or the Subsidiaries prior to the Closing Date in connection
with the negotiation and preparation of this Agreement and the consummation of the transactions contemplated hereby. For the avoidance of doubt, such out-of-pocket expenses of the Company and the Subsidiaries shall not include any payroll or other
internal expenses of the Company or the Subsidiaries, which expenses will be paid by the Company or the Subsidiaries in the ordinary course of their business. 
  

 46 

 Section 6.4 Access; Certain Communications. Between the date of this Agreement and the Closing
Date, subject to applicable laws relating to the exchange of information and subject to the provisions of contracts entered into by Seller, the Company, and any Subsidiary with third parties prior to the date of this Agreement: 
  
 (a) Seller shall (and shall cause the Company and each Subsidiary to) afford
to Buyer and its authorized agents and representatives access, upon reasonable advance notice and during normal business hours, to all books, records, documents and other information of the Company and the Subsidiaries; provided,
however, that Buyer’s investigation shall be conducted in a manner which does not materially interfere with the normal operations, customers and employee relations of the Company or the Subsidiaries. Notwithstanding the foregoing, Buyer
shall not have access to personnel records of the Company or the Subsidiaries relating to individual performance or evaluation records, medical histories or other books, records, documents or information that, in the opinion of Seller’s counsel
(whether Seller’s in-house or outside counsel), is sensitive or the disclosure of which could subject Seller, the Company or the Subsidiaries (or the trustees, directors, employees or agents of such entities) to risk of liability. Without
limiting any of the terms thereof, the terms of the Confidentiality Agreement shall govern Buyer’s and its agents’ and representatives’ obligations with respect to all confidential information with respect to Seller, the Company
and/or the Subsidiaries which has been or is provided or made available to them at any time, including during the period between the date of this Agreement and the Closing Date; 
  
 (b) Except as otherwise required pursuant to applicable law, each party hereto shall give prompt notice to the other party
of (i) any material communication received from or given to any Governmental Authority in connection with any of the transactions contemplated hereby, (ii) any notice or other communication from or on behalf of any Person alleging that the consent
of such Person is or may be required in connection with the transactions contemplated by this Agreement; and (iii) any actions, suits, claims or investigations commenced or, to such party’s knowledge, threatened against Buyer, Seller, the
Company or the Subsidiaries, as applicable, that seek 

  

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to restrain or enjoin the consummation of the transactions contemplated by this Agreement. 
  
 Section 6.5 Regulatory Matters; Third Party Consents. 
  
 (a) (i) Buyer (A) shall use commercially reasonable efforts promptly to cause
to be prepared and filed all necessary documentation, and to effect all applications, notices, petitions and filings, with each Governmental Authority which (x) are necessary to consummate the transactions contemplated by this Agreement and
(y) applicable law provides that Buyer or one of Buyer’s Affiliates is responsible or required to prepare, file and/or effect, and (B) shall use commercially reasonable efforts to obtain as promptly as practicable any consent, approval, order
or authorization of such Governmental Authority which (x) is necessary to consummate the transactions contemplated by this Agreement and (y) applicable law provides that Buyer or one of Buyer’s Affiliates is responsible or required to
obtain. Seller shall cooperate with Buyer in connection with Buyer’s performance of its obligations under this Section 6.5(a)(i). 
  
 (ii) Seller (A) shall use commercially reasonable efforts promptly to cause to be prepared and filed all necessary documentation, and to effect all
applications, notices, petitions and filings, with each Governmental Authority which (x) are necessary to consummate the transactions contemplated by this Agreement and (y) either (1) applicable law provides that Seller or one of
Seller’s Affiliates is responsible or required to prepare, file and/or effect or (2) applicable law does not specify the party responsible or required to prepare, file or effect such applications, notices, petitions and filings, and (B) shall
use commercially reasonable efforts to obtain as promptly as practicable any consent, approval, order or authorization of such Governmental Authority which (x) is necessary to consummate the transactions contemplated by this Agreement and (y)
either (1) applicable law provides that Seller or one of Seller’s Affiliates is responsible or required to prepare, file and/or effect or (2) applicable law does not specify the party responsible or required to prepare, file or effect such
applications, notices, petitions and filings, in any case including the Excluded Consents. Buyer shall cooperate with Seller in connection 

  

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with Seller’s performance of its obligations under this Section 6.5(a)(ii). 
  
 (iii) Notwithstanding anything to the contrary in this Agreement, neither Seller nor Buyer shall be obligated (nor shall
they be obligated to cause or permit any of their respective Affiliates to be obligated) to pay or provide any compensation or service to or at the direction of a Governmental Authority or otherwise incur any obligation to a Governmental Authority
or its designee (other than as may be specifically set forth in the Permit, Lease, or contract at issue and except for the payment of routine filing fees) in order to obtain any consent, approval, order or authorization of such Governmental
Authority. 
  
 (b) Buyer and Seller shall cooperate with each
other and (i) shall use their commercially reasonable efforts promptly to prepare and to file all necessary documentation, and to effect all applications, notices, petitions and filings, with each third party other than a Governmental Authority
which are necessary to consummate the transactions contemplated by this Agreement, and (ii) shall use their commercially reasonable efforts to obtain as promptly as practicable any consent, approval, order or authorization of such third party which
is necessary to consummate the transactions contemplated by this Agreement. Notwithstanding anything to the contrary in this Agreement, neither Seller nor Buyer shall be obligated (nor shall they be obligated to cause or permit any of their
respective Affiliates to be obligated) to pay or provide any compensation or service to or at the direction of such a third party or otherwise incur any obligation to such a third party or its designee (other than as may be specifically set forth in
the Permit, Lease, or contract at issue and except for the payment of routine filing fees) in order to obtain any such consent, approval, order or authorization of such a third party. 
  
 (c) Subject to applicable law relating to the exchange of information, Buyer and Seller shall have the right to review in
advance, and shall consult with the other party on, all the information relating to Seller, the Company and the Subsidiaries or Buyer, as the case may be, and any of their respective Affiliates, which appears in any filing made with, or written
materials submitted to, any Governmental Authority or any other third party in 

  

 49 

 
connection with the transactions contemplated by this Agreement. The parties hereto agree that they will consult with each other with respect to the
obtaining of any consent, approval, order or authorization of a Governmental Authority or other third party necessary to consummate the transactions contemplated by this Agreement and each party shall keep the other apprised of the status of
obtaining any such consent, approval, order or authorization. The party responsible for a filing shall promptly deliver to the other party evidence of the filing of all applications, notices, petitions and filings relating thereto, and any
supplement, amendment or item of additional information in connection therewith. The party responsible for a filing shall also promptly deliver to the other party a copy of each notice, order, opinion and other item of correspondence received from
or sent to any Governmental Authority by such filing party in respect of any such application, notice, petition or filing. In exercising the foregoing rights and obligations, Buyer and Seller shall act reasonably and promptly. 
  
 (d) Buyer and Seller shall, upon request, furnish each other with all
information concerning themselves, their respective subsidiaries, directors, officers and stockholders and such other matters as may be reasonably necessary in connection with any application, notice, petition or filing made by or on behalf of
Buyer, the Company or any of their respective Affiliates to any Governmental Authority in connection with the transactions contemplated by this Agreement (except to the extent that such information would be, or relates to information that would be,
filed under a claim of confidentiality). 
  
 (e) Buyer and Seller
shall promptly advise each other upon receiving any communication from any Governmental Authority whose consent, approval, order or authorization is required for consummation of the transactions contemplated by this Agreement which causes such party
to believe that there is a reasonable likelihood that any requisite consent, approval, order or authorization will not be obtained or will be materially delayed. 
  
 (f) Notwithstanding anything to the contrary contained in this Section 6.5 or elsewhere in this Agreement, if any Excluded
Consents have not been obtained prior to the earlier of (i) the date by which all other authorizations, filings, notifications, consents, orders 

  

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and approvals set forth on Schedules 4.4 and 5.3 have been obtained or made, as applicable, and (ii) the date that is sixty (60) days after the date hereof,
then pursuant to Seller’s written instructions that are provided from time to time thereafter with respect to the Excluded Consents, Buyer and Seller shall (and Buyer and Seller shall cause their respective Affiliates to) cease their efforts to
obtain such Excluded Consents and take such actions as Seller deems necessary to cause (and Seller shall use commercially reasonable efforts to cause to be prepared and filed all necessary documentation to cause) any or all of the certificates of
public convenience and necessity (or comparable authority) to which such Excluded Consents relate to be terminated on or prior to the Closing Date. The provisions of Section 6.5(a)(iii) shall apply as well to any consent, approval, order or
authorization that may be required to so terminate any and all such certificates of public necessity and convenience (or comparable authority). 
  
 Section 6.6 Further Assurances. Each of the parties hereto shall execute such documents and other papers and perform such further acts as may be
reasonably required to carry out the provisions hereof and the transactions contemplated hereby. Each such party shall, on or prior to the Closing Date, use its commercially reasonable efforts to fulfill the conditions precedent on its part to be
fulfilled for the consummation of the transactions contemplated hereby, including the execution and delivery of any documents, certificates, instruments or other papers that are required pursuant to this Agreement. 
  
 Section 6.7 Notification of Certain Matters. During the period between
the date hereof and the Closing Date, each party shall give prompt notice to the other party of (i) the occurrence, or failure to occur, of any event or the existence of any condition that has caused any of its representations or warranties
contained in this Agreement to be materially breached and (ii) any failure on its part to comply with or satisfy, in any material respect, any covenant, condition or agreement to be complied with or satisfied by it under this Agreement. 

 
 Section 6.8 Updated Schedules. Prior to Closing, Seller shall
supplement and/or otherwise amend its disclosure schedules, the Contract List and/or the Insurance and Bond List, including by the addition of new 

  

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schedules with respect to any representations and warranties of Seller in this Agreement for which no schedule was provided as of the date hereof (the
disclosure schedules, Contract List and Insurance and Bond List as supplemented and/or otherwise amended and any such new schedules, the “Updated Schedules”), with respect to matters arising after the date of this Agreement which matters,
if existing as of the date of this Agreement, would have been set forth in such Schedules, provided that the foregoing shall not apply with respect to any schedules, the Contract List or the Insurance and Bond List, or any portion thereof, that
relates solely to the date of this Agreement. Upon furnishing them to Buyer, and subject to Section 8.1(g), the Updated Schedules shall become part of this Agreement in lieu of their respective predecessor Schedules (if any) or Contract List or
Insurance and Bond List for all purposes of this Agreement. Notwithstanding the foregoing, no Updated Schedule shall be deemed to have cured any breach of any representation or warranty made by Seller as of the date of this Agreement, unless Buyer
otherwise consents in writing. Seller and Buyer acknowledge and agree that the inclusion of any item or statement in any schedule or Updated Schedule, which item or statement was not required to be included in such schedule or Updated Schedule
(because it does not meet a threshold amount for inclusion or for any other reason), shall not be construed to create any obligation to include any item or statement in the same or any different schedule or Updated Schedule, which item or statement
is not required to be so included (because it does not meet a threshold amount for inclusion or for any other reason); provided that, if Seller includes any item in a schedule as of the date of this Agreement and a change occurs with respect
to such item prior to Closing that would be required to be reflected in an Updated Schedule, Seller shall be required to reflect such change in the applicable Updated Schedule. 
  
 Section 6.9 Access To Records After Closing Date. From and after the Closing Date, each of the parties shall permit
the other party reasonable access to any records or other documents with respect to the Company or the Subsidiaries in its possession, and the right to duplicate such records or other documents, to the extent that the requesting party has a
reasonable business purpose for requesting such access or duplication. Notwithstanding any other provision of this Section, access to any records or 

  

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other documents may be denied to the requesting party if the other party is required under applicable law or by agreement to deny such access. Section 6.13,
rather than this Section, governs access to records and documents in connection with the WTC Site Cases and the Mastec Litigation. 
  
 Section 6.10 Employee Benefits. 
  
 (a) Except in the case of the Con Edison Non-Regulated Subsidiaries Severance Pay Plan (which is governed exclusively by Section 6.10(c)) and except as
noted in the third sentence of this Section 6.10(a), for purposes of Seller’s Benefit Plans, the employment of the Company Employees shall be deemed to be terminated as of the Closing Date and the rights of and benefits available to Company
Employees under Seller’s Benefit Plans shall be determined and calculated accordingly. The Seller’s Benefit Plans shall not be transferred to or assumed by Buyer or Buyer’s Affiliates, they shall not be benefit plans or arrangements
of the Company or the Subsidiaries on or after the Closing Date, they shall not follow the sale of the Shares to Buyer or Buyer’s Affiliates, and Buyer and Buyer’s Affiliates shall have no responsibility under the Seller’s Benefit
Plans. Notwithstanding the deemed termination described in the first sentence of this paragraph(a), a “qualifying event” entitling Company employees to continued health care coverage under COBRA shall not be deemed to occur if the
regulations under COBRA provide that the sale of the Shares pursuant to this Agreement does not constitute a “qualifying event.” 
  
 (b) Except as specified in the last sentence of this Section 6.10(b) with regard to COBRA continuation coverage, Company Employees shall not be permitted
to continue to participate in Seller’s Benefit Plans after the Closing Date. Except as set forth in Section 6.10(c), Seller shall retain responsibility for, and on and after the Closing Date shall indemnify and hold Buyer and the Company
harmless from, any and all obligations of the Company or any of the Subsidiaries to Company Employees (including those relating to expenses incurred by Company Employees or their eligible dependents prior to the Closing Date) arising under
Seller’s Benefit Plans and based either on (i) participation by Company Employees in Seller’s Benefit Plans prior to the Closing Date or (ii) employment of Company Employees by the Company or any of the Subsidiaries 

  

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prior to the Closing Date as such employment pertains to Seller’s Benefit Plans. To the extent required by COBRA, Seller agrees to retain responsibility
for making COBRA continuation coverage available to Company Employees. 
  
 (c) Effective as of the Closing Date, Buyer shall cause the employer of each Company Employee who is employed on or after the Closing Date by Buyer, any of its Affiliates, the Company or any of the Subsidiaries, or any related entity that
the foregoing may cause to so employ any Company Employee, to have in effect a severance plan (collectively, the “Buyer’s Severance Plan”) that contains terms identical in all material respects to the Con Edison Non-Regulated
Subsidiaries Severance Pay Plan, as in effect as of the Closing Date, including crediting Company Employees for their service prior to the Closing Date with the Company or any of the Subsidiaries or any of its or their Affiliates. Buyer shall cause
the Buyer’s Severance Plan to remain in effect for such period as will permit any Company Employee who is employed as aforesaid on or after the Closing Date to be entitled to benefits under the Buyer’s Severance Plan if such Company
Employee’s employment is terminated during the period between the Closing Date and the date that is six (6) months after the Closing Date and the nature of such termination qualifies the Company Employee for benefits under the Buyer’s
Severance Plan. Buyer shall cause the Buyer’s Severance Plan to remain free of any amendments, suspensions or terminations which would serve to reduce the benefits available thereunder to Company Employees or frustrate the intention of the
foregoing provisions, provided that Buyer, in its discretion and subject to the terms of the Buyer’s Severance Plan, applicable law, and the other provisions of this Agreement, may at any time after the date that is six (6) months after the
Closing Date terminate or amend the Buyer’s Severance Plan so long as such termination or amendment does not serve to reduce the benefits available under the Buyer’s Severance Plan to Company Employees whose employment is terminated during
the period between the Closing Date and the date that is six (6) months after the Closing Date or otherwise frustrate the intention of the foregoing provisions. Buyer shall cause the Company and the Subsidiaries on and after the Closing Date to
assume responsibility for, and Buyer shall indemnify and hold Seller and its Affiliates harmless from and against, all rights and claims, if any, of Company Employees against Seller and/or Seller’s Affiliates and all obligations, if 

  

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any, of Seller and/or Seller’s Affiliates to Company Employees under the Con Edison Non-Regulated Subsidiaries Severance Pay Plan based on any action,
including termination of employment of the Company Employees, that may be taken by the Buyer, any of its Affiliates, the Company or any of the Subsidiaries (or any related entity that the foregoing may cause to so employ any Company Employee) on or
after the Closing Date. 
  
 (d) Buyer shall cause the Con Edison
Communications, Inc. Change In Control Benefit Plan (the “Company CIC Plan”) to be retained and assumed by the Company and the Subsidiaries on and after the Closing Date. Notwithstanding the foregoing, and subject to the other terms and
conditions of the Company CIC Plan, Seller shall retain responsibility for, and on and after the Closing Date shall indemnify and hold Buyer, the Company and the Subsidiaries harmless from and against, any and all obligations of the Company and any
Subsidiary under the Company CIC Plan to any “Participant” as defined in the Company CIC Plan for (i) any payment pursuant to Section 3.1(a)(i) of the Company CIC Plan to which such a Participant may become entitled based upon the
transaction contemplated by this Agreement being a “Change in Control” as defined in the Company CIC Plan, and (ii) any “Transaction Bonus” as defined in the Company CIC Plan to which such a Participant may become entitled
pursuant to Section 3.3 of the Company CIC Plan based upon the transaction contemplated by this Agreement being a “Change in Control” as defined in the Company CIC Plan. Subject to Seller’s obligations under the immediately preceding
sentence, Buyer shall cause the Company and the Subsidiaries on and after the Closing Date to retain and assume the Company CIC Plan on and after the Closing Date and to retain and assume responsibility for, and Buyer shall indemnify and hold Seller
and Seller’s Affiliates harmless from and against, any and all other obligations of the Company and any Subsidiary under the Company CIC Plan, including any and all obligations to any “Participant” as defined in the Company CIC Plan
for any payment to which such a Participant may become entitled pursuant to Section 3.1(a)(ii) and/or Section 3.2 of the Company CIC Plan based upon the transactions contemplated by this Agreement being a “Change in Control” as defined in
the Company CIC Plan. Buyer shall cause the Company and the Subsidiaries, to the extent necessary to satisfy Buyer’s obligations under this Section 6.10(d), to maintain the Company CIC Plan free of 

  

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any amendments, suspensions or terminations which would serve to reduce the benefits available thereunder to Company Employees or frustrate the intention of
the foregoing provisions. Seller shall make any payments pursuant to Section 3.1(a)(i) and Section 3.3 of the Company CIC Plan directly to such Participant if Seller receives, in its discretion, adequate assurances that Seller, the Company and the
Subsidiaries would be discharged of their obligation to such Participant under Sections 3.1(a)(i) and 3.3 of the Company CIC Plan if such payment were made directly by Seller to such Participant rather than by the Company or any Subsidiary to such
Participant. 
  
 (e) Buyer shall cause any and all Company
Employees who are employed on or after the Closing Date by Buyer, one of its Affiliates, the Company or any of the Subsidiaries, or any related entity that the foregoing may cause to so employ any Company Employee, and who participate in any
existing or future employee benefit plan (other than any retirement benefit plan) of Buyer, any of its Affiliates, the Company, any of the Subsidiaries, or any related entity that the foregoing may cause to so employ the Company Employees
(collectively, “Buyer’s Benefit Plans”), to be (i) credited under Buyer’s Benefit Plans for their service prior to the Closing Date with the Company or any of the Subsidiaries or any of its or their Affiliates for purposes of
eligibility, pre-existing condition limitations, vesting employer contributions, matching contributions, severance allowance and service-related level of benefits under Buyer’s Benefit Plans (provided that service with the Company, the
Subsidiaries or its or their Affiliates prior to the Closing Date will not be required to be counted for purposes of benefit accruals after the Closing Date under any Buyer’s Benefit Plan maintaining accrued benefits that may be established or
amended after the Closing Date to provide for benefits based on accrued service); and (ii) credited for any co-payments and deductibles paid in connection with Seller’s Benefit Plans prior to the Closing Date in satisfying any applicable
deductible or out-of-pocket requirements under any applicable Buyer’s Benefit Plans. Buyer shall (A) cause the applicable entity under the Buyer’s Benefit Plans to (1) waive all limitations as to preexisting conditions and waiting periods
with respect to participation and coverage requirements applicable to all Company Employees who reside, as of the Closing, in the State of New York, New Jersey or Connecticut and (2) waive 

  

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all limitations as to preexisting conditions and waiting periods with respect to participation and coverage requirements applicable to each Company Employee
who resides, as of the Closing, in any state other than the State of New York, New Jersey or Connecticut if a certificate of coverage with respect to such Company Employee, as required under the Health Insurance Portability and Accountability Act of
1996, is provided to Buyer, and (B) use commercially reasonable efforts to cause the applicable entity under the Buyer’s Benefit Plans to waive all exclusions with respect to participation and coverage requirements applicable to the Company
Employees, other than, in the case of both (A) and (B) above, limitations, exclusions or waiting periods under Seller’s Benefit Plans that, as of the Closing Date, are in effect with respect to such Company Employees and have not been satisfied
or waived. 
  
 (f) To the extent that Company Employees
participate in or are eligible to participate in the Consolidated Edison Communications, Inc. Long Term Incentive Plan effective January 1, 2000, the employment of such Company Employees, for purposes of such plan, will be deemed to have been
terminated as of the Closing Date and the rights of such Company Employees under such plan shall be determined and calculated accordingly, and such plan shall not be retained or assumed by the Company or the Subsidiaries on or after the Closing Date
nor be transferred to, or follow the sale of the Shares to, Buyer or Buyer’s Affiliates. Prior to or as of the Closing Date, Seller shall cause the Company or a Subsidiary, as applicable, to terminate the Consolidated Edison Communications Long
Term Incentive Plan effective January 1, 2000 in a manner consistent with that plan and this Agreement.  
  
 (g) Buyer shall cause the Company Option Plan to be retained and assumed by the Company and the Subsidiaries on and after the Closing Date and shall cause
the Company and the Subsidiaries on and after the Closing Date to retain and assume the responsibility under such plan in respect of any and all awards issued under such plan that were not terminated or forfeited, subject in each case to any
permitted termination or modification of such plan and awards pursuant to the terms of such plan and awards and applicable law after the Closing Date. Seller shall cause the Company and the Subsidiaries to not issue any awards 

  

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under such plan during the Interim Period. In the event that any of the options set forth on the Stock Options List are exercised during the Interim Period
and the outstanding stock of the Company and the Subsidiaries is then not listed on any stock exchange or the Nasdaq National Market, then Seller shall cause the Company and the Subsidiaries, pursuant to Section 14(f)(c) of the Company Option Plan,
to decline to issue stock of the Company or the Subsidiaries in connection with the exercise of such option, unless a court of competent jurisdiction renders an order or judgment requiring that stock of the Company or the Subsidiaries be so issued.
Seller shall cause Buyer to be provided with written notice of the exercise of any such option during the Interim Period promptly after receipt by the Company or any Subsidiary of written documentation so exercising such option.  

 
 (h) Buyer shall cause the Con Edison Communications, Inc. Sales
Engineering-Director Compensation Plan for 2004, the Con Edison Communications, Inc. Sales Engineering Compensation Plan for 2004, the Con Edison Communications, Inc. Compensation Plan for Carrier/Enterprise Sales Director for 2004, and the Con
Edison Communications, Inc. Compensation Plan for Account Managers for 2004 (collectively, the “2004 Plans”) to be retained and assumed by the Company and the Subsidiaries on and after the Closing Date and shall cause the Company and the
Subsidiaries on and after the Closing Date to retain and assume all responsibility under such plans, subject in each case to any permitted termination or modification of the 2004 Plans pursuant to the terms of such plans and applicable law after the
Closing Date. Seller agrees to consult with Buyer in connection with Seller’s development of plans that replace the 2004 Plans and apply to sales made after the periods covered by the 2004 Plans (collectively, the “2005 Plans”);
provided, however, that, in any event, each of the 2005 Plans shall provide that it can be terminated at any time. 
  
 (i) Buyer, in its discretion, after conducting a diligence review satisfactory to Buyer, of the Consolidated Edison Thrift Savings Plan (a 401(k)Plan) in
which Company Employees participate, and subject to reaching mutual agreement with Seller regarding the matter, may cause a transfer of assets from such plan to be accepted into a 401(k) plan maintained on and after the Closing Date by Buyer, any of
its Affiliates, the Company, any of the 

  

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Subsidiaries, or any related entity that the foregoing may cause to so employ any Company Employee, which transfer shall consist of the account balances
under the Consolidated Edison Thrift Savings Plan of Company Employees who are employed by Buyer, any of its Affiliates, the Company, any of the Subsidiaries, or any related entity on and after the Closing Date. In addition, in the event that a
mutual agreement with Seller regarding the matter is reached, Buyer, in accordance with the principles and methods set forth in Revenue Ruling 2002-32, may cause a transfer of assets from a Code Section 132(f) fringe benefit plan or a Code Section
125 cafeteria plan in which Company Employees participate prior to the Closing Date to be accepted into a Code Section 132(f) or Code Section 125 plan maintained on and after the Closing Date by Buyer, any of its Affiliates, the Company, any of the
Subsidiaries, or any related entity that the foregoing may cause to so employ any Company Employee, which transfer shall consist of the account balances under the first-mentioned Code Section 132(f) fringe benefit plan and/or Code Section 125
cafeteria plan of Company Employees who are employed by Buyer, any of its Affiliates, the Company, any of the Subsidiaries, or any related entity on and after the Closing Date. Further, in the event that a mutual agreement with Seller regarding the
matter is reached, Buyer may continue, or may cause any of its Affiliates, the Company, any of the Subsidiaries, or any related entity that the foregoing may cause to so employ any Company Employee to continue, on and after the Closing Date,
appropriate payroll deductions to permit continued participation by Company Employees in the AFLAC plans (Personal Lifestyle Protector Cancer Plan, Personal Sickness Indemnity Plan, New York Dental Insurance Level 1) that are made available to
Company Employees as of the Closing Date. Buyer, Company and Seller shall cooperate in good faith to effectuate the provisions of this Section 6.10(i).  
  

(j) Seller shall provide to Buyer, by letter of even date herewith and by a subsequent letter delivered on or prior to the Closing Date, a list (the
“Company Employee List”) setting forth, as of the date hereof and as of the Closing Date, respectively, (i) for each Company Employee, the Company Employee’s base salary, the Company Employee’s initial date of hire by the
Company, a Subsidiary or an Affiliate of Seller, whichever is the earliest date, and the Company Employee’s job title and level, (ii) the names 

  

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of the Company Employees participating in the Company CIC Plan, and (iii) with respect to each Company Employee participating in the Company CIC Plan, the
“Applicable Percentage” (as defined in the Company CIC Plan), in each case except as otherwise specifically provided in the Company Employee List.  
  
 Section 6.11 No Solicitations. From the date hereof until the earlier of the Closing or the termination of this
Agreement in accordance with its terms, Seller shall not, nor shall it authorize or permit the Company or any Subsidiary or any of their respective officers or directors (collectively, the “Seller Representatives”), directly or indirectly,
to (a) solicit, facilitate, initiate, entertain, encourage or take any action to solicit, facilitate, initiate, entertain or encourage, any inquiries or communications or the making of any proposal or offer that constitutes an Acquisition Proposal,
or (b) participate or engage in any discussions or negotiations with, or provide any information to or take any other action with the intent to facilitate the efforts of, any Person concerning any possible Acquisition Proposal or any inquiry or
communication which might reasonably be expected to result in an Acquisition Proposal. Seller shall immediately cease and cause to be terminated, and shall cause all Seller Representatives to immediately cease and cause to be terminated, all
existing discussions or negotiations with any Persons conducted heretofore with respect to, or that could reasonably be expected to lead to, an Acquisition Proposal. Seller shall promptly notify each Seller Representative of its obligations under
this Section 6.11. Without limiting the foregoing, it is agreed that any violation of the restrictions set forth above by the Company, any Subsidiary or any other Seller Representative, whether or not such Person is purporting to act on behalf of
Seller, shall be deemed to be a breach of this Section 6.11 by Seller. 
  
 Section 6.12 Change In Name of Company and Subsidiaries; No Transfer Of Rights to Names of Seller, Seller Affiliates Or Predecessors. 
  
 (a) On or prior to the Closing Date, Seller, at its option, may (and/or may cause the Company and the Subsidiaries to) prepare and file all applications,
notices, petitions and filings with each Governmental Authority and otherwise which are necessary or advisable to 

  

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change the name of the Company and the Subsidiaries so as to remove therefrom the names “Consolidated Edison”, “Con Edison” and
“CEC”. In connection with preparing and filing such applications, notices, petitions and filings, Seller shall consult with Buyer with regard to the new names that Buyer wishes to utilize for the Company and the Subsidiaries. On the
Closing Date, Buyer shall mail to each Person with whom the Company or any Subsidiary has entered into a Contract or Lease (the “Company Contract Parties”) a notice specifying the change in the names of the Company and the Subsidiaries and
that the Company and the Subsidiaries are no longer affiliated with Seller. If, during the thirty (30) day period commencing on the Closing Date, Seller delivers written notice to any Company Contract Parties for the purpose of informing them of the
change in the names of the Company and the Subsidiaries or the fact that the Company and the Subsidiaries are no longer affiliated with Seller, then Seller agrees to provide Buyer with a copy of such notice. 
  
 (b) Notwithstanding anything to the contrary in this Agreement, it is
understood and agreed that Seller hereby retains, and does not transfer to Buyer, the Company, any Subsidiary or any other Person, any and all right, title and interest in and to (including the right to use) the names “Consolidated
Edison”, “Con Edison”, “Con Ed”, Consolidated Edison Company”, “Consolidated Edison Company of New York, Inc.”, “Consolidated Edison, Inc.”, “Consolidated Edison Communications Holding Company,
Inc.”, “CEC Holding Member, Inc.,” “Con Edison Communications, Inc.,” “Con EdisonCommunications, LLC”, “Con Ed Communications”, “Con Edison Communications”, “Consolidated Edison
Communications”, “CEC”, “New York Edison”, “Brooklyn Edison”, “Staten Island Edison”, and “Edison” and any related or similar trade names, trademarks, service marks or logos. 
  
 Section 6.13 Retained Liability For Certain Litigation. Seller shall
retain responsibility for, and on and after the Closing Date shall defend the interests of the Company and the Subsidiaries in, and indemnify and hold Buyer, the Company and the Subsidiaries harmless from and against any and all liability of the
Company or any Subsidiary in the WTC Site Cases and the action entitled Mastec North America, Inc. against Consolidated Edison, Inc., Consolidated Edison Company of New York, Inc., Con Edison Communications, Inc., and Con Edison Communications,

  

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LLC, bearing Index Number 601831/2002, and pending in the Supreme Court of the State of New York for the County of New York (the “Mastec
Litigation”) and from and against any and all liability of the Company or any Subsidiary in the WTC Site Cases and the Mastec Litigation that may be imputed to Buyer. At all times on and after the Closing Date, Buyer shall make available, and
shall cause Buyer’s Affiliates, including the Company and the Subsidiaries, to make available, to Seller, Seller’s Affiliates and their respective counsel (at no cost to Seller, Seller’s Affiliates or their respective counsel, other
than Seller’s reimbursement of the reasonable out-of-pocket expenses incurred by Buyer or Buyer’s Affiliates, including the Company or any of the Subsidiaries, and paid to third parties in connection with their compliance with this
sentence): (a) the officers, directors, employees and agents of Buyer and/or Buyer’s Affiliates, including the Company and/or the Subsidiaries, as witnesses to the extent that such persons may reasonably be required in connection with the WTC
Site Cases, the Mastec Litigation and/or defending the same, and (b) records and other documentation in the possession or control of Buyer and/or Buyer’s Affiliates, including the Company and/or any of the Subsidiaries, to the extent that the
same may be reasonably required in connection with the WTC Site Cases, the Mastec Litigation and/or defending the same. Without limiting the foregoing, Seller shall have the right to retain copies of or originals of (in which case Seller shall
provide Buyer with copies of) any books, records and other documentation and information relating to the Company or any of the Subsidiaries or their respective businesses to the extent that Seller reasonably believes that such books, records and
other documentation and information may be reasonably required in connection with the WTC Site Cases, the Mastec Litigation and/or defending the same. 
  
 Section 6.14 Release of Indemnity Obligations. Seller covenants and agrees, on or prior to Closing, to execute and deliver to the Company, for the
benefit of the Company and each Subsidiary, a release in the form attached hereto as Schedule 6.14 (the “Release”). 
  
 Section 6.15 Non-Competition; Confidentiality. 
  
 (a) Non-Compete. During the period from the Closing Date until the third anniversary thereof (the “Restricted Period”), Seller shall not,
and Seller shall cause its 

  

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Affiliates to not, without the prior written consent of Buyer, (i) engage in the Restricted Business in the Restricted Area or (ii) engage in any business
under the name of the Company or any Subsidiary; provided, however, that, notwithstanding anything to the contrary in this Section 6.15(a), Seller and/or its Affiliates (collectively, the “Restricted Parties”) may (A) engage
in the business of providing communications services over power lines (“Power Line Communications”) so long as the Restricted Parties do not directly market or sell Power Line Communications to end use customers of such Power Line
Communications (provided that the foregoing shall not prohibit or preclude any Restricted Party from (x) marketing or selling Power Line Communications to third parties who are not end use customers of Power Line Communications, (y)
permitting third parties to market or sell Power Line Communications to end use customers of Power Line Communications, or (z) using Power Line Communications for, or marketing or selling Power Line Communications to third parties, including end use
customers of Power Line Communications, for use in connection with, electric, gas, steam or water generation, transmission, distribution or metering systems and their performance and state of maintenance and repair, management of load or consumption
or usage relating to electric, gas, steam or water utility service, meter reading and other meter applications, and monitoring and communication concerning electric, gas, steam and water utility service pricing) and (B) acquire an interest in,
merge, consolidate or combine with, be acquired by or engage in any similar transaction with any Person that is, directly or indirectly, engaged in the Restricted Business in the Restricted Area so long as (1) such Person has not derived more than
50% of its revenue, on a consolidated basis, during the twelve month period preceding the date of such acquisition, merger, consolidation or combination, from the operation of the Restricted Business in the Restricted Area (excluding, for such
purpose, any revenues from Power Line Communications) and (2) after such acquisition, merger, consolidation, combination or similar transaction and until the expiration of the Restricted Period, (x) no Restricted Party (or any surviving corporation
of such acquisition, merger, consolidation, combination or similar transaction) increases the funding of the operations of such Restricted Business in the Restricted Area during any twelve (12) month period above the funding of such operations
during the twelve (12) month period immediately preceding such 

  

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acquisition, merger, consolidation, combination or similar transaction and (y) the Restricted Business in the Restricted Area is not conducted under any name
set forth in Section 6.12(b) hereof. During the Restricted Period, Seller shall not, and shall not permit its Affiliates to, engage in any activity through an agent if (i) such activity would be prohibited pursuant to this Section 6.15(a) if
undertaken directly by Seller or one of its Affiliates and (ii) such agent is directed or controlled by Seller or one of its Affiliates with respect to such activity. As used in this Section 6.15(a), the term “controlled” means the power
to cause the agent to act or fail to act. During the Restricted Period, Seller shall not induce or attempt to induce any employee of the Company or any Subsidiary to leave the employ of such organization. 
  
 (b) Confidential Information. During the Restricted Period, Seller
shall keep confidential and retain in strictest confidence, and shall not use for the benefit of itself or others in any way that may be competitive with, or could be detrimental to, the Company or any Subsidiary, all confidential matters of the
Company or any Subsidiary, including confidential matters consisting of “know-how,” trade secrets, customer lists, details of client or consultant contracts, pricing policies, operational methods, marketing plans or strategies, product or
service development techniques or plans, business acquisition plans, new personnel acquisition plans, methods of manufacture, technical processes, designs and design projects, inventions and research projects of the Company or any Subsidiary learned
by Seller heretofore or hereafter. The obligations and restrictions imposed on Seller pursuant to this Section 6.15(b) shall not apply to information that (i) is or becomes generally available to the public other than as a result of a disclosure by
Seller, (ii) becomes available to Seller on a nonconfidential basis from a source other than the Company or any Subsidiary, but only if such source is not bound by a confidentiality agreement with the Company or any Subsidiary and is not otherwise
prohibited from transmitting the information to Seller by a contractual, legal, fiduciary or other obligation, (iii) is independently developed by Seller without reference to any confidential matters of the Company or any Subsidiary, or (iv) is
requested or required to be disclosed by law (including by oral question or written request for information or documents in any legal proceeding, 

  

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interrogatory, subpoena, civil investigative demand or similar legal proceeding). 
  
 (c) Specific Performance. Seller acknowledges and agrees that Buyer would be irreparably harmed in the event any of
the provisions of this Section 6.15 are breached. Accordingly, Seller agrees that Buyer shall be entitled to an injunction to prevent breaches of the provisions of this Section 6.15 and to enforce specifically this Section 6.15, in addition to any
other remedy to which Buyer may be entitled, at law or in equity or pursuant to this Agreement. 
  
 (d) Termination of Application of Section 6.15(a). In the event that, after the Closing Date, Buyer or any of Buyer’s Affiliates (including
the Company and any Subsidiary) who are party to the 55 Broad Street Security Agreement, the 111 Eighth Avenue Security Agreement or the Rider X Security Agreement breach any of their obligations under the 55 Broad Street Security Agreement, the 111
Eighth Avenue Security Agreement or the Rider X Security Agreement, then, unless Buyer shall cause such breach to be cured within thirty (30) days after receipt of written notice from Seller, Section 6.15(a) shall be null and void and without
further force and effect and Seller shall have no obligations and Buyer shall have no rights pursuant to Section 6.15(a). The foregoing shall be in addition to, and not in lieu of, any other remedies available to Seller for any such breach and the
provision immediately above providing for notice and an opportunity to cure shall not be deemed to condition or otherwise affect any other remedies available to Seller for any such breach. 
  
 (e) Reasonableness of Covenants. Seller and Buyer acknowledge and
agree that this Section 6.15 is reasonable and valid in all respects. 
  
 Section 6.16 Estoppel Certificates. Within 30 days after the date hereof, Seller agrees to request, or to cause the Company to request, each of the top five customers of the Company, measured by revenue received from such customer
for the three (3) month period ending on the last day of the month prior to the date hereof, to execute an estoppel certificate, in substantially the form attached hereto as Schedule 6.16. 
  

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 Section 6.17 Cooperation. 
  
 (a) During the period from the date hereof until the Closing Date, at the reasonable request of Buyer from time to time,
Seller agrees to cause such Company Employees, as may be agreed upon by Buyer and Seller, to visit customers of the Company and the Subsidiaries with sales representatives of Buyer to reasonably cooperate with and assist Buyer in encouraging such
customers to continue to use the services of the Company after Closing. 
  
 (b) After the Closing Date, Seller shall make available to Buyer, the Company and the Subsidiaries and their respective counsel (at no cost to Buyer, the Company, the Subsidiaries or their respective counsel, other than Buyer’s
reimbursement of the reasonable out-of-pocket expenses incurred by Seller and paid to third parties in connection with its compliance with this sentence): (i) the officers and employees of Seller as witnesses to the extent that such persons may
reasonably be required in connection with the litigation matters set forth on Schedule 4.8 and/or defending the same, and (ii) records and other documentation in the possession or control of Seller to the extent that the same may be reasonably
required in connection with the litigation matters set forth on Schedule 4.8 and/or defending the same. 
  
 Section 6.18 Security and Reimbursement Obligations. Seller and Buyer shall execute and deliver the Security Agreements as of the Closing Date and
Buyer shall cause the other signatories thereto to execute and deliver the Security Agreements as of the Closing Date. Seller shall cause each guaranty that any of the Security Agreements requires to be furnished by Seller to a third party on behalf
of or for the benefit of the Company or any of the Subsidiaries on the Closing Date (the “Retained Seller-Provided Indebtedness,” which is set forth on Schedule 6.18) to be furnished to such third party on the Closing Date and Buyer shall
cause each letter of credit that any of the Security Agreements requires to be furnished to Seller to be so furnished to Seller on the Closing Date. On or prior to the Closing Date, Buyer shall cause security replacing all Seller-Provided
Indebtedness except the Retained Seller-Provided Indebtedness (the “Replaced Seller-Provided Indebtedness”) to be furnished to the third party possessing or secured by the Replaced Seller-Provided Indebtedness and the Replaced
Seller-Provided Indebtedness to be released and returned to Seller. 
  

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 Section 6.19 Insurance. Buyer acknowledges and agrees that no insurance policy or fidelity bond
which is maintained by, or on behalf of, the Company or any of the Subsidiaries prior to the Closing Date or which provides any insurance coverage or other financial protection with respect to the assets, business, equipment, properties, operations,
employees, officers or directors of the Company or any Subsidiary prior to the Closing Date (collectively, the “Applicable Insurance Policies”) shall be transferred to Buyer or Buyer’s Affiliates, be retained or assumed by the Company
or any of the Subsidiaries on or after the Closing Date or, subject to the proviso in the next succeeding sentence, otherwise be required to be continued in force and effect on and after the Closing Date. Seller, in its sole discretion, may from
time to time on or after the Closing Date cause any and all of the Applicable Insurance Policies to be canceled, terminated, modified or supplemented, including with regard to coverage relating to the Company or the Subsidiaries, provided that,
Seller shall cause (a) the first $35,000,000 layer of its claims made, excess liability insurance program that is provided through AEGIS policy X0007A1A4 (the “1st Layer Excess Policy”) to remain in effect until April 28, 2005 (the expiration date of the 1st Layer Excess Policy), and (b) the Company and the Subsidiaries to be insured parties under such 1st Layer Excess Policy (subject to its terms) with respect to occurrences prior to the Closing Date for which claims are made relating to the Company or the
Subsidiaries prior to April 28, 2005. If Seller, from time to time and in its sole discretion, decides to renew the 1st Layer Excess Policy with AEGIS after its expiration on April 28, 2005 so that the coverage through such a renewal policy with AEGIS is available for claims made during any period between April 28, 2005 and the third annual
anniversary of the Closing Date (each, a “1st Layer Excess Renewal Policy”), Seller agrees to notify Buyer
of such decision and provide Buyer with the opportunity to have the Company and the Subsidiaries be insured parties under any such 1st Layer Excess Renewal Policy (subject to its terms) for occurrences prior to the Closing Date for which claims are
made relating to the Company or the Subsidiaries prior to the expiration date of such 1st Layer Excess Renewal Policy, in each case subject to Buyer paying Seller in advance for the cost that is reasonably allocable to the 

  

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provision of such insurance coverage to the Company and the Subsidiaries. For the avoidance of doubt, it is acknowledged and agreed that Seller shall have no
obligations and Buyer shall have no rights hereunder with respect to any 1st Layer Excess Renewal Policy when the
policy it replaces or renews expires after the third annual anniversary of the Closing Date. Seller shall have any and all rights to any and all credits, premium refunds and premium returns under the Applicable Insurance Policies and as they
may be canceled, terminated, modified or supplemented. 
  
 Section
6.20 Notice of Termination of Securities Purchase Agreement. Buyer shall immediately notify Seller if (a) the Securities Purchase Agreement is terminated or (b) if any party to the Securities Purchase Agreement notifies Buyer (whether in
writing, orally or otherwise) that such party does not intend to consummate the transactions contemplated by the Securities Purchase Agreement. 
  
 Section 6.21 Dissolution of CEC VA. Prior to the Closing Date, Seller agrees to use commercially reasonable efforts to cause Consolidated Edison
Communications of Virginia, Inc. (“CEC VA”) to be dissolved in the Commonwealth of Virginia; provided, however, that the failure of Seller to cause CEC VA to be dissolved prior to the Closing Date shall not constitute a
breach of this Agreement or a basis for Buyer to claim that a condition to closing has not been satisfied. 
  
 ARTICLE VII 
 TAX MATTERS 
  
 Section 7.1 Indemnity. 
  
 (a) (i) Subject to the terms of Section 7.1(c), (ii) excluding payments to
Seller pursuant to Section 7.2, (iii) except to the extent of the amount reserved for Taxes (not including any deferred Tax amounts) on the Interim Financial Statements, (iv) except to the extent that any Tax with respect to taxable periods ending
on or before the Closing Date is attributable to an audit adjustment that results in an increase in the taxable income of the Company or its Subsidiaries for any such period and a correlative decrease in such taxable income in a later taxable period
beginning on or after the Closing Date (in which case the 

  

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amount of the indemnity shall be reduced by the discounted present value of the resulting reasonably estimated future benefit), and (v) except as otherwise
provided in Section 7.9, Seller agrees to indemnify and hold harmless Buyer, the Company and each Subsidiary against the following Taxes and against any loss, damage, liability or expense, including reasonable fees for attorneys and other outside
consultants, incurred in contesting or otherwise in connection with any such Taxes: (x) Taxes imposed on the Company or any Subsidiary with respect to taxable periods ending on or before the Closing Date; (y) Taxes imposed on any member of any
consolidated, combined or unitary group with which any of the Company and the Subsidiaries file or have filed a Tax Return on a consolidated, combined or unitary basis for a taxable period ending on or before the Closing date; and (z) with respect
to taxable periods beginning before the Closing Date and ending after the Closing Date, Taxes imposed on the Company or any Subsidiary which are allocable, pursuant to Section 7.1(b), to the portion of such Tax period ending on the Closing Date.
Seller’s indemnity obligations under this Section 7.1(a) shall exist regardless of the accuracy of the representations and warranties set forth in Section 4.14 and regardless of any disclosure made on Schedule 4.14, and the representations and
warranties of Seller set forth in Section 4.14 of this Agreement shall terminate as of the Closing Date. 
  
 (b) In the case of Taxes that are payable with respect to a taxable period that begins before the Closing Date and ends after the Closing Date the portion
of any such Tax that is allocable to the portion of the period ending on the Closing Date shall be: 
  
 (i) in the case of Taxes that are either (A) based upon or related to income or receipts (including franchise fees under any franchise
agreements between the Company or any Subsidiary and any franchisor (“Franchise Fees”) to the extent based upon or related to income or receipts), or (B) imposed in connection with any sale or other transfer or assignment of property (real
or personal, tangible or intangible) (other than conveyances pursuant to this Agreement, as provided under Section 7.9), deemed equal to the amount which would be payable if the taxable period ended with the Closing Date; and 
  

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 (ii) in the case of Taxes (including Franchise Fees) imposed on a periodic basis with
respect to the assets of the Company or any Subsidiary, or otherwise measured by the level of any item, deemed to be the amount of such Taxes for the entire period (or, in the case of such Taxes determined on an arrears basis, the amount of such
Taxes for the immediately preceding period), multiplied by a fraction the numerator of which is the number of calendar days in the period ending on the Closing Date and the denominator of which is the number of calendar days in the entire period.

  
 (c) Notwithstanding any provision in this Agreement to the
contrary, Seller shall only be obligated to Buyer pursuant to the provisions of Section 7.1(a) for Taxes for which (i) Buyer, the Company or any Subsidiary, as the case may be, has received a notice of proposed adjustment (or similar written notice)
in writing from a Taxing Authority (or has paid or borne the economic effect of such Taxes upon written request of a Taxing Authority), and (ii) Seller has received written notice of claim thereof from Buyer on or prior to sixty (60) days after the
expiration of the applicable statute of limitations relating to the proposed Tax (without regard to any tolling or other extension of such statute of limitations, unless otherwise agreed by Seller). Seller shall not have any liability under this
Section 7.1(c) after the date that is sixty (60) days after the expiration of the applicable statute of limitations relating to the proposed Tax (without regard to any tolling or other extension of such statute of limitations, unless otherwise
agreed by Seller) unless and to the extent that proper notice of claim under this Section 7.1(c) shall be given to Seller on or before such date. 
  
 Section 7.2 Tax Allocation Agreement Payments. The Tax Allocation Agreements are hereby terminated respecting the Company and the Subsidiaries, and
no payments shall be owing to or from Seller, Buyer, the Company or any Subsidiary under the Tax Allocation Agreements except to the extent reflected in the Interim Financial Statements. 
  
 Section 7.3 Returns and Payments. 
  
 (a) Seller shall prepare and file or otherwise furnish in proper form to the
appropriate Taxing Authority (or cause to be prepared and filed or so furnished) in a 

  

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timely manner all (i) consolidated, combined and unitary Tax Returns (each a “Consolidated Return”) that include Seller and (ii) Tax Returns
relating to the Company and the Subsidiaries that are attributable to periods ending on or before the Closing Date (and Buyer shall do the same with respect to any non-Consolidated Return for the Company and the Subsidiaries attributable to periods
ending after the Closing Date). Tax Returns of the Company and the Subsidiaries not yet filed for any taxable period that begins before the Closing Date shall be prepared in a manner consistent with past practices employed with respect to the
Company and the Subsidiaries (except to the extent counsel for Seller or the Company renders a legal opinion that a Tax Return cannot be so prepared and filed without being subject to penalties). With respect to any non-Consolidated Return required
to be filed by Buyer or Seller with respect to the Company and the Subsidiaries and as to which an amount of Tax is allocable to the other party under Section 7.1(b), the filing party shall provide the other party and its authorized representatives
with a copy of such completed Tax Return and a statement certifying the amount of Tax shown on such Tax Return that is allocable to such other party pursuant to Section 7.1(b), together with appropriate supporting information and schedules at least
forty-five (45) days prior to the due date (including any extension thereof) for the filing of such Tax Return, and such other party and its authorized representatives shall have the right to review and comment on such Tax Return and statement prior
to the filing of such Tax Return. 
  
 (b) After the Closing Date,
Seller shall pay when due and payable all Taxes with respect to the Company and the Subsidiaries that are unpaid as of the Closing Date and are allocable to Seller pursuant to Sections 7.1(a) and 7.1(b) (either directly to the appropriate Taxing
Authority or as appropriate to Buyer, the Company or any Subsidiary as the case may be). 
  
 (c) All Taxes with respect to the Company and the Subsidiaries not allocated to Seller pursuant to Section 7.1(a) and 7.1(b) shall be allocated to Buyer. Buyer shall indemnify and hold harmless Seller against, and
shall or shall cause the Company or the Subsidiaries to pay, all Taxes that are allocable to Buyer pursuant to the preceding sentence (either directly to the appropriate Taxing Authority or, as appropriate, to Seller). Buyer shall indemnify and hold
harmless Seller against any and all 

  

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Taxes allocated to Buyer pursuant to the first sentence of this Section 7.3(c) and against any loss, damage, liability or expense, including reasonable fees
for attorneys and other outside consultants, in connection with such Taxes. 
  
 Section 7.4 Refunds. Any Tax refund (including any interest with respect thereto) relating to the Company or any Subsidiary for Taxes paid for any taxable period or portion thereof ending on or prior to the
Closing Date shall be the property of Seller, and if received by Buyer or the Company or any Subsidiary shall be paid over promptly to Seller. To the extent any such tax refund is the result of a decrease in items of income previously reported for a
period ending on or prior to the Closing Date and a correlative increase in items of income for a period subsequent to the Closing Date, then the payment to Seller shall be reduced by the discounted present value of the resulting reasonably
estimated tax burden to Buyer. 
  
 Section 7.5
Contests. 
  
 (a) After the Closing, each of Buyer and
Seller shall promptly notify the other party in writing of any written notice of a proposed assessment, audit, contest, proceeding or litigation (a “Contest”) of Buyer or Seller or of any of the Company and the Subsidiaries which could
reasonably be expected to result in grounds for payment by such other party under this Article VII. 
  
 (b) For all Contests for which either party alone bears the economic burden under Article VII, such party shall control all such Contests in connection
therewith. In other cases, prior to the Closing Date, Seller shall control all Contests relating to the Company and the Subsidiaries and, after the Closing Date, in the case of a Contest that relates to a non-Consolidated Return (or any item
relating thereto or reported thereon) for a taxable period ending on or before, or that includes, the Closing Date, Seller shall have the right at its expense to participate in the conduct of such Contest, and for all taxable periods thereafter,
Buyer shall control such Contests; provided, however, that Seller shall control any contest that relates to a Consolidated Return of Seller. If Seller does not assume the defense of any such Contest for a taxable period ending on or
before the Closing Date, Buyer may defend the same in such manner as it may deem appropriate, including settling such Contest after giving 

  

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30 days’ prior written notice to Seller setting forth the terms and conditions of settlement. Notwithstanding the foregoing, Buyer shall control any
Contests relating to, and shall be under no obligation to dispute or otherwise litigate, any Franchise Fees with respect to which Buyer receives a bona fide request for payment from the applicable franchisor and such Franchise Fees shall be paid by
Seller to the extent such Franchise Fees relate to the period prior to the Closing Date, as determined in accordance with Section 7.1 above; provided that Buyer shall not (and shall cause its Affiliates not to) solicit or enter into any
arrangement with any franchisor under which payment of Franchise Fees relating to the period prior to the Closing Date is made in return for a reduction in Franchise Fees relating to the period on or after the Closing Date or other benefit to Buyer
or its Affiliates. 
  
 (c) Buyer and Seller agree to cooperate,
and Buyer agrees to cause the Company and the Subsidiaries to cooperate, in the defense against or compromise of any claim in any Contest. 
  
 Section 7.6 Section 338(h) (10) Election. 
  
 (a) Seller and Buyer shall make a joint election pursuant to Section 338(h)(10) of the Code and similar provisions of state and local laws, to the extent
permitted (the “Election”) to treat Buyer’s acquisition of the Shares as a deemed acquisition of the Company’s and the Subsidiaries’ assets. Buyer and Seller shall cooperate in timely making such Election and in filing all
returns, documents, statements, and other forms that are required to be submitted to any federal, state or local taxing authority in connection with the Election, including any “statement of Section 338 election” and IRS Form 8023 or any
successor form (together with any schedules or attachments thereto) pursuant to regulations (collectively, the “Treasury Regulations”) promulgated by the United States Department of the Treasury (or its successor). 
  
 (b) For purposes of making such Election, Seller shall determine the value of
the tangible and intangible assets of the affected entities and shall timely provide Buyer with an allocation of Buyer’s “adjusted grossed-up basis” in the Shares (within the meaning of the Treasury Regulations under Section 338 of
the Code) to such assets (the “Allocation”) and Buyer shall have reasonable 

  

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opportunity to comment thereon. After consideration of Buyer’s comments, Seller’s Allocation shall be binding, the Allocation shall be binding upon
Buyer and Seller for purposes of allocating the “deemed selling price” (within the meaning of the Treasury Regulations) among the assets of the affected entities; provided, however, that if, upon the advice of tax counsel
reasonably acceptable to Seller, Buyer believes that the Allocation is materially incorrect, the Independent Accounting Firm shall determine whether the Allocation is materially incorrect and the determination of such Independent Accounting Firm
shall be final. If the Independent Accounting Firm determines that the Allocation is not materially incorrect, Seller and Buyer shall be bound by the Allocation. If the Independent Accounting Firm determines that the Allocation (or any portion
thereof) is materially incorrect, Seller and Buyer shall be bound by the Allocation as adjusted by such Independent Accounting Firm. 
  
 (c) Neither Buyer nor Seller shall agree to any proposed adjustment to the Allocation by any Taxing Authority without first giving the other prior written
notice and the opportunity to challenge such proposed adjustment. 
  
 (d) Buyer shall not, without the prior written consent of Seller, make any election under Section 338(g) of the Code or take any other action which may cause Buyer’s acquisition of the Shares to fail to qualify as a deemed acquisition
of the Company’s assets pursuant to Section 338(h)(10) of the Code and similar provisions of state and local laws. 
  
 Section 7.7 Time of Payment. Except as provided in Section 7.2 hereof, payment of any amounts due under this Article VII in respect of Taxes shall
be made (i) at least three Business Days before the due date of the applicable Tax Return required to be filed by either Buyer or Seller, as the case may be, that shows Taxes due for which the other party is responsible under this Agreement, or (ii)
within three Business Days following an agreement between Seller and Buyer that an indemnity amount is payable, an assessment of a Tax by a Taxing Authority, or a “determination” having been made as such term is defined in Section 1313(a)
of the Code. If liability under this Article VII is in respect of costs or expenses other than Taxes, payment of any amounts due under this Article VII 

  

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shall be made within five Business Days after the date when the relevant entity has been notified that such entity has a liability for a determinable amount
under this Article VII and is provided with calculations or other materials supporting such liability. 
  
 Section 7.8 Cooperation and Exchange of Information. Upon the terms set forth in Section 6.4 of this Agreement, Seller and Buyer will provide each
other with such cooperation and information as either of them reasonably may request of the other in filing any Tax Return, amended Tax Return or claim for refund, determining a liability for Taxes or a right to a refund of Taxes, participating in
or conducting any Contest in respect of Taxes or making representations to or furnishing information to parties subsequently desiring to purchase any of the Company or the Subsidiaries or any part of the business from Buyer. Such cooperation and
information shall include providing copies of relevant Tax Returns or portions thereof, together with accompanying schedules, related work papers and documents relating to rulings or other determinations by Taxing Authorities. Seller shall make its
employees available on a basis mutually convenient to both parties to provide explanations of any documents or information provided hereunder as is reasonably practicable. Each of Seller and Buyer shall retain all Tax Returns, schedules and work
papers, records and other documents in its possession relating to Tax matters of the Company and the Subsidiaries for each taxable period first ending after the Closing Date and for all prior taxable periods until the later of (i) the expiration of
the statute of limitations of the taxable periods to which such Tax Returns, schedules and work papers, records and other documents relate, without regard to extensions except to the extent notified in writing of such extensions for the respective
Tax periods, or (ii) three years following the due date (without extension) for such Tax Returns, provided, however, that Seller may satisfy its obligations hereunder by delivering all such Tax Returns, schedules and work papers,
records and other documents to Buyer. Any information obtained under this Section 7.8 shall be kept confidential in accordance with Section 6.4 except as may be otherwise necessary in connection with the filing of Tax Returns or claims for refund or
in conducting a Contest. 
  
 Section 7.9 Conveyance Taxes.
Buyer and Seller shall each be liable for one-half of any real property 

  

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transfer or gains, sales, use, transfer, value added, stock transfer, and stamp taxes, any transfer, recording, registration, and other fees, and any similar
Taxes which become payable in connection with the transactions contemplated by this Agreement, and shall file such applications and documents as shall permit any such Tax to be assessed and paid on or prior to the Closing Date in accordance with any
available pre-sale filing procedure. Buyer or Seller, as appropriate, shall execute and deliver all instruments and certificates necessary to enable the other to comply with any filing requirements relating to any such Taxes. 
  
 Section 7.10 Miscellaneous. Seller and Buyer agree to treat all
payments made by either of them to or for the benefit of the other (including any payments to the Company or any Subsidiary) under this Article VII and under other indemnity provisions of this Agreement as adjustments to the Purchase Price solely
for federal and applicable state and local income tax purposes. 
  
 ARTICLE VIII 
 CONDITIONS TO CLOSING 
  
 Section 8.1 Conditions to Buyer’s Obligations. In addition to the conditions set forth in Section 8.3, the
obligations of Buyer to effect the Closing shall be subject to the following conditions, any one or more of which may be waived in writing by Buyer: 
  
 (a) The representations and warranties of Seller set forth in this Agreement shall be true and correct in all material respects (i) as of the date of this
Agreement and (ii) as of the Closing Date as though made as of the Closing Date (giving effect to the Updated Schedules), except that any such representation and warranty that is given as of a particular date or period and relates solely to such
particular date or period shall be true and correct in all material respects only as of such date or period; provided, however, that with respect to any representation or warranty or portion thereof that is qualified by Material
Adverse Effect, materiality or similar qualifier, such representation or warranty or portion thereof shall be true and correct in all respects; 
  
 (b) Seller shall have performed and complied with in all material respects all agreements, covenants, 

  

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obligations and conditions required by this Agreement to be performed or complied with by Seller on or prior to the Closing Date; 
  
 (c) Seller shall have caused to be delivered to Buyer a certificate executed
by a duly authorized officer of Seller certifying that the conditions set forth in Sections 8.1(a) and (b) have been satisfied; 
  
 (d) Except as set forth on Schedule 8.1(d), Seller shall deliver to Buyer certificates as to the good standing of the Company and the Subsidiaries in the
respective jurisdictions of their organization, together with a copy of the Certificate of Incorporation of the Company certified by the Secretary of State of the State of New York; 
  
 (e) Seller shall deliver to Buyer resolutions of the board of directors of Seller and the finance committee of the board of
directors of Seller, certified by the Secretary or Assistant Secretary of Seller, approving and authorizing the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby; 
  
 (f) Seller shall deliver a certificate of the Secretary or Assistant
Secretary of Seller as to the incumbency of the officer executing this Agreement on behalf of Seller and the genuineness of such officer’s signature; 
  
 (g) No events or conditions shall have occurred since the date hereof which, individually or in the aggregate, have had any Material Adverse Effect;

  
 (h) Buyer shall have received an opinion from counsel to
Seller, with respect to the matters set forth on Schedule 8.1(h) hereto; 
  
 (i) Buyer shall have received the Release from Seller; and 
  
 (j) Seller shall have provided Buyer with the resignations of the members of the boards of directors of the Company and the Subsidiaries resigning their respective positions as such directors. 
  

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 (k) All authorizations, filings, notifications, consents, orders and approvals set forth on Schedule 5.3
other than the Excluded Consents shall, as applicable, have been made or obtained, and shall be in full force and effect; provided, however, that any such authorization, filing, notification, consent, order or approval which requires,
as a condition to its effectiveness or continued effectiveness, that Buyer (or any of its Affiliates) pay or provide any compensation or service to or at the direction of a Governmental Authority or to or at the direction of a third party other than
a Governmental Authority or otherwise incur any obligation to such a Governmental Authority or its designee or to a third party other than a Governmental Authority or such third party’s designee (other than as may be specifically set forth in
the Permit, Lease, or contract at issue and except for the payment of routine filing fees), shall not be considered an authorization, filing, notification, consent, order or approval satisfying this Section 8.1(k) unless Buyer agrees in its sole and
unfettered discretion to pay or provide such compensation or service or incur such obligation (or to cause or permit any of its Affiliates to pay or provide such compensation or service or incur such obligation). 
  
 (l) To the extent that an Excluded Consent has not been obtained, any
authorization, filing, notification, consent, order or approval required to be made to or obtained from a Governmental Authority or a third party other than a Governmental Authority in order to terminate, on or prior to the Closing Date, the
certificate of public convenience and necessity (or comparable authority) to which such Excluded Consent relates shall, as applicable, have been made or obtained and shall be in full force and effect; provided, however, that any such
authorization, filing, notification, consent, order or approval which requires, as a condition to its effectiveness or continued effectiveness, that Buyer (or any of its Affiliates) pay or provide any compensation or service to or at the direction
of a Governmental Authority or to or at the direction of a third party other than a Governmental Authority or otherwise incur any obligation to such a Governmental Authority or its designee or to a third party other than a Governmental Authority or
such third party’s designee (other than as may be specifically set forth in the Permit, Lease, or contract at issue and except for the payment of routine filing fees), shall not be considered an authorization, filing, notification, consent,
order or 

  

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approval satisfying this Section 8.1(l) unless Buyer agrees in its sole and unfettered discretion to pay or provide such compensation or service or incur
such obligation (or to cause or permit any of its Affiliates to pay or provide such compensation or service or incur such obligation). 
  
 Section 8.2 Conditions to Seller’s Obligations. In addition to the conditions set forth in Section 8.3, the obligations of Seller to effect
the Closing shall be subject to the following conditions, any one or more of which may be waived in writing by Seller: 
  
 (a) The representations and warranties of Buyer set forth in this Agreement shall be true and correct in all material respects as of the date of this
Agreement and as of the Closing Date as though made on and as of the Closing Date, except that any such representation and warranty that is given as of a particular date or period and relates solely to such particular date or period shall be true
and correct only as of such date or period; provided, however, that with respect to any representation or warranty or portion thereof that is qualified by Material Adverse Effect, materiality or similar qualifier, such representation
or warranty or portion thereof shall be true and correct in all respects; 
  
 (b) Buyer shall have performed and complied with in all material respects all agreements, covenants, obligations and conditions required by this Agreement to be performed or complied with by Buyer on or prior to the
Closing Date; 
  
 (c) Buyer shall have caused to be delivered to
Seller a certificate executed by a duly authorized officer of Buyer certifying that the conditions set forth in Sections 8.2 (a) and (b) have been satisfied; 
  
 (d) Buyer shall deliver to Seller resolutions of the board of directors of Buyer, certified by the Secretary or Assistant Secretary of Buyer, approving
and authorizing the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby; 
  
 (e) Buyer shall deliver a certificate of the Secretary or Assistant Secretary of Buyer as to the incumbency of the officer executing this Agreement on

  

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behalf of Buyer and the genuineness of such officer’s signature; 
  
 (f) Seller shall have received an opinion from counsel to Buyer, with respect to the matters set forth on Schedule 8.2(f)
hereto; and 
  
 (g) Buyer shall deliver to Seller a duly executed
copy of each Security Agreement, together with any letters of credit and other documents required to be furnished by Buyer thereunder. 
  
 (h) All authorizations, filings, notifications, consents, orders and approvals set forth on Schedule 4.4 other than the Excluded Consents shall have been
obtained and shall remain in full force and effect; provided, however, that any such authorization, filing, notification, consent, order or approval which requires, as a condition to its effectiveness or continued effectiveness, that
Seller (or any of its Affiliates) pay or provide any compensation or service to or at the direction of a Governmental Authority or to or at the direction of a third party other than a Governmental Authority or otherwise incur any obligation to such
a Governmental Authority or its designee or to a third party other than a Governmental Authority or such third party’s designee (other than as may be specifically set forth in the Permit, Lease, or contract at issue and except for the payment
of routine filing fees), shall not be considered an authorization, consent, order or approval satisfying this Section 8.2(h) unless Seller agrees in its sole and unfettered discretion to pay or provide such compensation or service or incur such
obligation (or to cause or permit any of its Affiliates to pay or provide such compensation or service or incur such obligation). 
  
 (i) To the extent that an Excluded Consent has not been obtained, any authorization, filing, notification, consent, order and approval required to be made
to or obtained from a Governmental Authority or a third party other than a Governmental Authority in order to terminate, on or prior to the Closing Date, the certificate of public convenience and necessity (or comparable authority) to which such
Excluded Consent relates shall, as applicable, have been made or obtained and shall be in full force and effect; provided, however, that any such authorization, filing, notification, consent, order or approval which 

  

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requires, as a condition to its effectiveness or continued effectiveness, that Seller (or any of its Affiliates) pay or provide any compensation or service
to or at the direction of a Governmental Authority or to or at the direction of a third party other than a Governmental Authority or otherwise incur any obligation to such a Governmental Authority or its designee or to a third party other than a
Governmental Authority or such third party’s designee (other than as may be specifically set forth in the Permit, Lease, or contract at issue and except for the payment of routine filing fees), shall not be considered an authorization, filing,
notification, consent, order or approval satisfying this Section 8.2(i) unless Seller agrees in its sole and unfettered discretion to pay or provide such compensation or service or incur such obligation (or to cause or permit any of its Affiliates
to pay or provide such compensation or service or incur such obligation). 
  
 Section 8.3 Mutual Condition. The obligations of each of Buyer and Seller to effect the Closing shall be subject to no temporary restraining order, preliminary or permanent injunction or other order issued by a
court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the transactions contemplated by this Agreement being in effect. 
  
 ARTICLE IX 
 SURVIVAL OF REPRESENTATIONS, WARRANTIES, 
 COVENANTS AND AGREEMENTS; INDEMNIFICATION 
  
 Section 9.1 Survival. 
  
 (a) Except as may be otherwise specified in this Agreement with regard to any
specific representation and warranty (including Article VII hereof), the representations and warranties of the parties set forth in this Agreement shall terminate on the date that is twelve (12) months after the Closing Date; provided,
however, that (i) the representations and warranties set forth in Section 4.3(a), 4.5 and 5.2(a) shall survive indefinitely, (ii) the representations and warranties set forth in Section 4.13 shall terminate on the date that is three (3) years
after the Closing Date, and (iii) the representations and warranties set forth in Section 4.18 shall terminate on the date that is four (4) years after the Closing Date. Notice with respect to any claim in respect of any inaccuracy in 

  

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or breach of any representation or warranty shall be in writing and shall be given to the party against which such claim is asserted on or before the date on
which such representation or warranty terminates. Neither Seller nor Buyer shall have any liability whatsoever with respect to any representation or warranty after the date on which such representation or warranty terminates unless and to the extent
that proper notice with respect to a claim in respect of an inaccuracy in or breach of any representation or warranty shall be given to the party against which such claim is asserted on or before the date on which such representation or warranty
expires. 
  
 (b) All covenants and agreements made by the parties
to this Agreement which contemplate performance following the Closing Date shall survive the Closing Date in accordance with their respective terms. All other covenants and agreements shall not survive the Closing Date and shall terminate as of the
Closing Date. 
  
 Section 9.2 Obligation of Seller to
Indemnify. Subject to the limitations set forth in Sections 9.1 and 9.6, Seller shall indemnify, defend and hold harmless Buyer and its directors, officers, employees, Affiliates, and their respective successors and assigns, from and against any
Loss incurred by any of them based upon or arising out of (i) any breach of any representation or warranty made by Seller in this Agreement; (ii) any breach of any representation or warranty made by Seller in this Agreement as if such representation
or warranty were made as of the Closing Date (giving effect to the Updated Schedules); and (iii) the failure by Seller to perform any unwaived covenant or agreement in this Agreement on its part to be performed; provided that such covenant or
agreement survives the Closing Date in accordance with Section 9.1. 
  
 Section 9.3 Obligation of Buyer to Indemnify. Subject to the limitations set forth in Sections 9.1 and 9.6, Buyer shall indemnify, defend and hold harmless Seller and its directors, officers, employees, Affiliates, and their
respective successors and assigns, from and against any Loss incurred by any of them based upon or arising out of (i) any breach of any representation or warranty made by Buyer in this Agreement; (ii) any breach of any representation or warranty
made by Buyer in this Agreement as if such representation or warranty were made as of the Closing Date; (iii) the failure by Buyer to perform any 

  

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unwaived covenant or agreement in this Agreement on its part to be performed; and (iv) any and all claims, actions or proceedings by any party to the
Securities Purchase Agreement or any other Securities Purchase Documents, such party’s successors or assigns, or the shareholders, partners, members, directors, officers or employees of any such party or successor or assign, which are based
upon or arise out of the execution, delivery and/or performance of the Security Purchase Agreement or any other Securities Purchase Documents and/or the consummation of any other financing transactions, the proceeds of which are used to finance
Buyer’s payment obligations under this Agreement or any other Buyer Transaction Document; provided that such covenant or agreement survives the Closing Date in accordance with Section 9.1. Notwithstanding anything to the contrary in the
preceding clause (iv) of this Section, such clause (iv) shall not be deemed to preclude or prohibit Buyer from asserting any claim, action or proceeding or to require Buyer to indemnify, defend and hold harmless Seller and its directors, officers,
employees, Affiliates, and their respective successors and assigns, from and against any claim, action or proceeding, which (i) is asserted or commenced by Buyer against Seller, (ii) is based upon or arises out of the execution, delivery and/or
performance of the Security Purchase Agreement or any other Securities Purchase Documents and/or the consummation of any other financing transactions, the proceeds of which are used to finance Buyer’s payment obligations under this Agreement or
any other Buyer Transaction Document, (iii) is not a shareholders derivative claim, action or proceeding or a claim, action, or proceeding wherein Buyer is a nominal party or is not the real party in interest, and (iv) is not a cross claim, action
or proceeding or an impleader claim, action or proceeding or any other claim, action or proceeding whereby Buyer seeks to hold Seller responsible for any liability that has been imposed or is sought to be imposed upon Buyer by one or more third
parties. 
  
 Section 9.4 Notice and Opportunity to Defend
Against Third Party Claims. 
  
 (a) Promptly after receipt
from any third party by either party hereto (the “Indemnitee”) of a notice of any demand, claim or circumstance that, immediately or with the lapse of time, would give rise to a claim or the commencement (or threatened commencement) of any
action, 

  

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proceeding or investigation (an “Asserted Liability”) that may result in a Loss for which indemnification may be sought hereunder, the Indemnitee
shall give written notice thereof (the “Claims Notice”) to the party obligated to provide indemnification pursuant to Section 9.2 or 9.3 (the “Indemnifying Party”); provided, however, that a failure to give such
notice shall not prejudice the Indemnitee’s right to indemnification hereunder except to the extent that the Indemnifying Party is prejudiced or forfeits substantive rights or defenses as a result of such failure. The Claims Notice shall
describe the Asserted Liability in reasonable detail, and shall indicate the amount (estimated, if necessary) of the Loss that has been or may be suffered by the Indemnitee. For the avoidance of doubt, nothing in this Section 9.4 with regard to
Claims Notices shall be deemed to affect the limitations set forth in Section 9.1. 
  
 (b) The Indemnifying Party may elect to compromise or defend, at its own expense and by its own counsel, any Asserted Liability. If the Indemnifying Party elects to compromise or defend such Asserted Liability, it
shall, within twenty (20) Business Days following its receipt of the Claims Notice notify the Indemnitee of its intent to do so, and the Indemnitee shall cooperate, at the expense of the Indemnifying Party, in the compromise of, or defense against,
such Asserted Liability. If the Indemnifying Party elects not to compromise or defend the Asserted Liability, fails to notify the Indemnitee of its election as herein provided or contests its obligation to provide indemnification under this
Agreement, the Indemnitee may pay, compromise or defend such Asserted Liability. Notwithstanding the foregoing, neither the Indemnifying Party nor the Indemnitee may settle or compromise any Asserted Liability without the consent of the other party;
provided, however, that such consent to settlement or compromise shall not be unreasonably delayed or withheld. In any event, the Indemnitee and the Indemnifying Party may participate, at their own expense, in the defense of such
Asserted Liability. If the Indemnifying Party chooses to compromise or defend any Asserted Liability, the Indemnitee shall make available to the Indemnifying Party any books, records or other documents within its control that are necessary or
appropriate for such defense. 
  
 Section 9.5 Tax
Indemnification. Notwithstanding any provision of this Article IX or any other provision of this Agreement, any issue or matter relating to Taxes shall 

  

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be governed solely by Article VII, including the termination of the representations and warranties contained in Section 4.14. 
  
 Section 9.6 Limits on Indemnification. (a) No party shall have any
right to seek indemnification under this Agreement (i) with respect to Losses contemplated by Section 9.2(i) or (ii) which would otherwise be indemnifiable hereunder (including Losses incurred by all other Indemnitees affiliated with or related to
such party) until such Losses exceed $250,000 in the aggregate (provided that for the sole purpose of determining whether this $250,000 amount has been satisfied no effect shall be given to any Material Adverse Effect, materiality or similar
qualifier or any threshold dollar amounts in any representation or warranty), in which case such party (including such affiliated or related Persons) shall only be entitled to be indemnified for Losses in excess of such aggregate amount, or (ii) for
punitive, special, indirect or consequential damages, including lost profits, lost revenues, lost savings and increased costs of operations; provided, however, that the provisions of clause (i) immediately above shall not apply to any
breach by Seller of the representations and warranties contained in Section 4.3(a) and 4.5 or of any unwaived covenant or agreement set forth in Section 6.10 or 6.15(a). After the Closing, the remedies provided by this Article IX shall be the sole
and exclusive remedy for the parties to this Agreement with respect to any dispute arising from, or related to, this Agreement, except in the case of fraud and except that injunctive relief (including specific performance) shall continue to be
available to the extent such remedy is in respect of a then surviving representation, warranty, covenant or agreement. 
  
 (b) Notwithstanding any provision of this Agreement, the liability of Seller under this Article IX shall be limited to an amount equal to $9,000,000;
provided, however, that the limitation set forth in this Section 9.6(b) shall not apply to: (i) any breach by Seller of the representations, warranties and covenants contained in Sections 4.3(a), 4.5, 6.10 and 6.15(a); (ii) to any
breach by Seller of the representation and warranty contained in Section 4.15(a)(iv) relating to the identification on Schedule 4.15(a) (or any update thereto) of any contract or agreement relating to Indebtedness, provided, however,
that Seller shall have no liability whatsoever for any failure 

  

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to identify on Schedule 4.15(a) (or any update thereto) any contract or agreement relating to Indebtedness to the extent that the Indebtedness under such
unidentified contract or agreement was taken into account for purposes of any adjustment to the Purchase Price pursuant to Section 3.3 hereof; or (iii) to any breach by Seller of the representation and warranty contained in Section 4.15(d) relating
to the identification on Schedule 4.15(d) (or any update thereto) of any contract or agreement relating to Seller-Provided Indebtedness. 
  
 ARTICLE X 
 TERMINATION

  
 Section 10.1 Termination. (a) This Agreement may be
terminated on or prior to the Closing Date only as follows: 
  
 (i) by mutual written consent of Buyer and Seller; 
  
 (ii) by either Buyer or Seller if a condition to its obligation to perform set forth in Article VIII hereof becomes incapable of
fulfillment, which termination may be effective at any time after such condition becomes incapable of fulfillment (including termination by Buyer if any events or conditions shall have occurred between the date of this Agreement and the Closing Date
which, individually or in the aggregate, have had any Material Adverse Effect), provided, however, that the right to terminate this Agreement pursuant to this Section 10.1(a)(ii) shall not be available to any party if its condition to
perform became incapable of fulfillment due to its failure to fulfill any obligation under this Agreement; 
  
 (iii) by either Buyer or Seller upon written notice to the other if the Closing shall not have occurred by the date that is eighteen (18)
months after the date of this Agreement; provided, however, that the right to terminate this Agreement pursuant to this clause (iii) shall not be available to any party whose breach of any provision of this Agreement resulted in the
Closing not occurring by such date; or 
  
 (iv)
by Seller upon written notice to Buyer if (i) the Securities Purchase Agreement is terminated or 

  

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(ii) if any party to the Securities Purchase Agreement notifies Buyer (whether in writing, orally or otherwise) that such party does not intend to consummate
the transactions contemplated by the Securities Purchase Agreement. 
  
 (b) The termination of this Agreement shall be effectuated by the delivery of a written notice of such termination from the party terminating this Agreement to the other party. 
  
 Section 10.2 Obligations upon Termination. In the event that this Agreement shall be terminated pursuant to Section
10.1, all obligations of the parties hereto under this Agreement shall terminate and there shall be no liability of either party hereto to the other party hereto, except (i) as set forth in Section 6.2 and Section 6.3, and (ii) that nothing herein
will relieve any party from liability for any breach of this Agreement and the non-breaching party shall have the right to pursue all available legal and equitable remedies. 
  
 ARTICLE XI 
 MISCELLANEOUS 
  
 Section 11.1 Amendment.
This Agreement may not be amended, altered or modified except by written instrument executed by Buyer and Seller. 
  
 Section 11.2 Entire Agreement. 
  
 (a) This Agreement, the Confidentiality Agreement and the other Seller Transaction Documents and Buyer Transaction Documents constitute the entire
understanding of the parties hereto with respect to the transactions contemplated hereby, and supersede all prior agreements and understandings, written and oral, among the parties with respect to the subject matter hereof. 
  
 (b) THE REPRESENTATIONS AND WARRANTIES MADE BY SELLER IN THIS AGREEMENT ARE
IN LIEU OF AND ARE EXCLUSIVE OF ALL OTHER REPRESENTATIONS AND WARRANTIES, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE AND ANY OTHER EXPRESS OR IMPLIED WARRANTIES OF SELLER. SELLER HEREBY DISCLAIMS, AND
NEITHER SELLER, ITS AFFILIATES, NOR ANY OF ITS OR THEIR RESPECTIVE DIRECTORS, TRUSTEES, OFFICERS, EMPLOYEES, AGENTS OR REPRESENTATIVES 

  

 87 

 
SHALL HAVE ANY RESPONSIBILITY OR LIABILITY PURSUANT TO, ANY SUCH OTHER EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES, NOTWITHSTANDING THE DELIVERY OR
DISCLOSURE BY SELLER OR ANY OTHER PERSON TO BUYER OR ANY OF ITS DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR REPRESENTATIVES, OF ANY DOCUMENTATION OR OTHER INFORMATION IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED THEREBY.

  
 Section 11.3 Interpretation. When reference is made in
this Agreement to any Section, Exhibit or Schedule, such reference is to a Section, Exhibit or Schedule of this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and
shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words
“without limitation.” The phrases “the date of this Agreement,” “the date hereof” and terms of similar import, unless the context otherwise requires, shall be deemed to refer to the date set forth in the first paragraph
of this Agreement. The words “hereof”, “herein”, “hereby” and other words of similar import refer to this Agreement as a whole unless otherwise indicated. The phrase “to the knowledge of Seller” or any similar
phrase shall be deemed to refer to the actual knowledge of any of the executive officers of Seller, the President or General Counsel of the Company or the Subsidiaries or the CFO of CSS, after due inquiry with regard to the subject matter to which
the phrase “to the knowledge of Seller” or any similar phrase applies. Whenever the singular is used herein, the same shall include the plural, and whenever the plural is used herein, the same shall include the singular, where appropriate.

  
 Section 11.4 Severability. Any term or provision of
this Agreement which is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of
this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, that provision shall be interpreted to
be only so broad as is enforceable. 
  

 88 

 Section 11.5 Notices. All notices and other communications hereunder shall be in writing and shall
be deemed given and delivered if they are: (a) delivered in person, (b) transmitted by facsimile (followed by delivery by mail or courier), (c) delivered by certified or registered mail (return receipt requested), or (d) delivered by a nationally
recognized express courier (with confirmation) to a party at its address listed below (or at such other address as such party shall deliver to the other party by like notice): 
  
 If to Seller, to: 
  
 Consolidated Edison, Inc. 
 4 Irving Place,
Room 1810-S 
 New York, NY 10003 
 Facsimile: (212) 677-5850 
 Attention: General Counsel 
  
 With a concurrent copy to: 
  
 Steptoe & Johnson LLP 
 1330 Connecticut
Avenue, NW 
 Washington, DC 20036 
 Facsimile: (202) 429-3902 
 Attention: Alfred M. Mamlet, Esq. 
  
 If to Buyer, to: 
  
 Fibernet Telecom Group, Inc. 
 570 Lexington
Avenue 
 New York, NY 10022 
 Facsimile: (212) 421-8920 
 Attention:  President 
  
 With a concurrent copy to: 
  
 Mintz Levin Cohn Ferris Glovsky & Popeo PC 
 One Financial Center 
 Boston, MA 02111 
 Facsimile: (617) 542-2241 
 Attention:  John Pomerance, Esq. 
  

 89 

 Section 11.6 Binding Effect; Persons Benefiting; No Assignment. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. Nothing in this Agreement is intended or shall be construed to confer upon any Person other than the parties hereto and their respective
successors and permitted assigns any right, remedy or claim under or by reason of this Agreement or any part hereof. This Agreement may not be assigned by either party hereto without the prior written consent of the other party; provided,
however, that Buyer may designate that, at Closing, the Shares be delivered to one or more of its Affiliates (in any such case, Buyer shall remain responsible for the performance of its obligations hereunder). 
  
 Section 11.7 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same agreement, it being understood that all of the parties need not sign the same counterpart. 
  
 Section 11.8 No Prejudice. This Agreement has been jointly prepared by
the parties hereto and the terms hereof shall not be construed in favor of or against any party on account of its participation in such preparation. 
  
 Section 11.9 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK
WITHOUT RECOURSE TO SUCH STATE’S CHOICE OF LAW PRINCIPLES. 
  
 Section 11.10 Limited Liability. Notwithstanding anything to the contrary set forth in this Agreement, no party to this Agreement shall be liable for any punitive, special, indirect or consequential damages, including lost profits,
lost revenues, lost savings and increased costs of operations. 
  
 Section 11.11 Jurisdiction and Enforcement. 
  
 (a) Each of Seller and Buyer irrevocably submits to the exclusive jurisdiction of (i) the Supreme Court of the State of New York, New York County and (ii) the United States District Court for the Southern District of New York, 

  

 90 

 
for the purposes of any suit, action or other proceeding arising out of this Agreement or any transaction contemplated hereby. Each of Seller and Buyer
agrees to commence any action, suit or proceeding arising out of this Agreement or any transaction contemplated hereby either in the United States District Court for the Southern District of New York or, if such suit, action or proceeding may not be
brought in such court due to subject matter jurisdictional reasons, in the Supreme Court of the State of New York, New York County. Each of the parties further agrees that service of process, summons, notice or document by hand delivery or U.S.
certified mail at the address specified for such party in Section 11.5 (or such other address specified by such party from time to time pursuant to Section 11.5) shall be effective service of process for any action, suit or proceeding brought
against such party in any such court. Each of the parties irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or any transaction contemplated hereby in (i) the
Supreme Court of the State of New York, New York County, or (ii) the United States District Court for the Southern District of New York, and hereby further irrevocably and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. Nothing herein shall affect the right to effect service of process in any other manner permitted by law. 
  
 Section 11.12 WAIVER OF TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
AGREES THAT ANY SUIT, ACTION OR PROCEEDING, WHETHER CLAIM OR COUNTERCLAIM, BROUGHT OR INSTITUTED BY ANY PARTY HERETO OR ANY SUCCESSOR OR ASSIGN OF ANY PARTY, WHICH ARISES FROM THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE
TRIED ONLY BY A COURT AND NOT BY A JURY. EACH PARTY HEREBY EXPRESSLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION OR PROCEEDING. EACH PARTY HAS ENTERED INTO THIS AGREEMENT IN RELIANCE UPON THIS WAIVER OF JURY TRIAL. 
  
 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 
  

 91 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first set
forth above. 
  

					
	CONSOLIDATED EDISON, INC.
		
	By:	 	 
	 Name:
	 	Stephen B. Bram
	 Title:
	 	Group President Energy and Communications
	
	FIBERNET TELECOM GROUP, INC.
		
	By:	 	 
	 Name:
	 	Michael S. Liss
	 Title:
	 	President and Chief Executive Officer

  

 92Securities Purchase Agreement dated December 10, 2004

 EXHIBIT 10.67 
  
 SECURITIES PURCHASE AGREEMENT 
  

This SECURITIES PURCHASE AGREEMENT (the “Agreement”), dated as of December 10, 2004, is made by and among FiberNet Telecom Group,
Inc., a corporation organized under the laws of the State of Delaware (the “Company”), and each of the purchasers (individually, a “Purchaser” and collectively the “Purchasers”) set forth on the
execution pages hereof (each, an “Execution Page” and collectively the “Execution Pages”).  
  
 BACKGROUND 
  
 A. The Company and each Purchaser are executing and delivering this Agreement in reliance upon the exemption from securities registration afforded by the
provisions of Regulation D (“Regulation D”), as promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Securities Act”).

  
 B. Upon the terms and conditions stated in this Agreement, the
Company desires to issue and sell to the Purchasers, and each Purchaser desires to purchase, units (the “Units”), each Unit consisting of (i) one share of the Company’s Series K Convertible Preferred Stock, par value $.001 per
share (the “Preferred Stock”), which Preferred Stock shall have the rights, preferences and privileges set forth in the form of Certificate of Designation, Preferences and Rights attached hereto as Exhibit A (the
“Certificate of Designation”), and shall initially be convertible into shares of the Company’s common stock, par value $.001 per share (the “Common Stock”), at an initial conversion price established in
accordance with Section 1(c), and (ii) a warrant, in the form attached hereto as Exhibit B (the “Warrants”), to acquire initially such number of shares of Common Stock equal to 30% of the number of shares of Common
Stock issuable upon conversion of one share of Series K Preferred Stock. The shares of Common Stock issuable upon conversion of or otherwise pursuant to the Preferred Stock are referred to herein as the “Conversion Shares” and the
shares of Common Stock issuable upon exercise of or otherwise pursuant to the Warrants are referred to herein as the “Warrant Shares.” The Preferred Stock, the Warrants, the Conversion Shares and the Warrant Shares are collectively
referenced herein as the “Securities” and each of them may individually be referred to herein as a “Security.” 
  
 C. Contemporaneously with the execution and delivery of this Agreement, the Company shall amend, through the execution of an amended and restated warrant
in the form attached hereto as Exhibit C (the “Amended Warrants”), all of the common stock purchase warrants currently owned by SDS Capital Group SPC, Ltd. (“SDS Warrants”) to reduce the exercise price
thereof from there respective current amounts to $.01. 
  
 D.
Contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Registration Rights Agreement, in the form attached hereto as Exhibit D (the “Registration Rights
Agreement”), pursuant to which the Company has agreed to provide certain registration rights under the Securities Act and the rules and regulations promulgated thereunder, and applicable state securities laws. This Agreement, the 

  

 
Certificate of Designation, the Warrants, the Registration Rights Agreement, and the Amended Warrants are collectively referred to herein as the
“Transaction Documents.” 
  
 E. The proceeds from
the sale and issuance of the Units will be used by the Company in connection with its future purchase from Consolidated Edison, Inc. (“Con Ed”) of 50,000,000 shares of the common stock (the “Con Ed Holdings Stock”)
of Consolidated Edison Communications Holding Company, Inc. (“Con Ed Holdings”), a wholly-owned subsidiary of Con Ed, pursuant to the terms and conditions of a definitive agreement, in the form attached hereto as Exhibit E
(the “Con Ed Agreement”), to be entered into by the Company and Con Ed on or after the date hereof but prior to the Closing Date. The assets held by Con Ed Holdings are referred to herein as the “Con Ed Assets.”

  
 NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Purchasers, intending to be legally bound, hereby agree as follows: 
  

	1.	PURCHASE AND SALE OF SECURITIES. 

  
 (a) Purchase and Sale of Units. Subject to the terms and conditions hereof, at the Closing (as defined in Section 1(b) below), the Company
shall issue and sell to each Purchaser, and each Purchaser, severally and not jointly, shall purchase from the Company, such number of Units as is set forth on such Purchaser’s Execution Page, for a purchase price (as to each Purchaser, the
“Purchase Price”) per Unit equal to Ten Thousand Dollars ($10,000). 
  
 (b) The Closing. The closing of the transactions contemplated hereby (the “Closing”) shall take place at the offices of Drinker Biddle & Reath LLP at One Logan Square, 18th & Cherry
Streets, Philadelphia, Pennsylvania 19103 at 10:00 a.m., Philadelphia, Pennsylvania time, on the first date on which all conditions set forth in Sections 6 and 7 below have been satisfied or waived, or such other later time or place as the
Company and the Purchasers may mutually agree (the “Closing Date”). 
  
 (c) Conversion Price. The Preferred Stock initially shall be convertible into shares of Common Stock at an initial conversion price (the “Conversion Price”) of $1.00 per share of Common
Stock; provided, however, if requested by SDS Capital Partners, LLC at any time prior to the Closing Date, the Conversion Price shall be equal to the average Closing Sales Price of the Common Stock during the five trading days immediately
preceding the Closing Date. For purposes of this Section 1(c), “Closing Sales Price” and “trading day” shall have the meanings given to them in the Certificate of Designation. 
  
 (d) Exercise Price. The Warrants shall be exercisable for shares of
Common Stock at an initial exercise price per share of Common Stock equal to the Conversion Price. 
  

	2.	PURCHASER’S REPRESENTATIONS AND WARRANTIES. 

  
 Each Purchaser severally, but not jointly, represents and warrants to the Company as follows: 
  
 (a) Organization and Standing of the Purchasers. If the Purchaser is
an entity, such Purchaser is a corporation, limited liability company or partnership duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization. 
  

 - 2 - 

 (b) Purchase for Own Account, Etc. Purchaser is purchasing the Securities solely for its own
account for investment purposes only and not with a present view towards the public sale or distribution thereof, except pursuant to sales that are exempt from the registration requirements of the Securities Act and/or sales registered under the
Securities Act. Purchaser understands that it must bear the economic risk of this investment indefinitely, unless the Securities are registered pursuant to the Securities Act and any applicable state securities or blue sky laws or an exemption from
such registration is available, and that the Company has no present intention of registering the resale of any such Securities other than as contemplated by the Registration Rights Agreement. Notwithstanding anything in this Section 2(b) to
the contrary, by making the representations herein, such Purchaser does not agree to hold the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with federal and state
securities laws applicable to such disposition. 
  
 (c) No
Conflict. The execution, delivery and performance of this Agreement and the Registration Rights Agreement by the Purchaser and the consummation by the Purchaser of the transactions contemplated thereby and hereby do not and will not (i) violate
any provision of the Purchaser’s charter or organizational documents or (ii) to Purchaser’s knowledge, result in a violation of any federal, state, local or foreign statute, rule, regulation, order, judgment or decree (including federal
and state securities laws and regulations) applicable to the Purchaser or by which any property or asset of the Purchaser are bound or affected, except, in all cases, other than violations pursuant to clauses (i) or (ii) (with respect to federal and
state securities laws) above, except for such conflicts, defaults, terminations, amendments, acceleration, cancellations and violations as would not, individually or in the aggregate, materially adversely affect the Purchaser’s ability to
perform its obligations under the Transaction Documents. 
  
 (d)
Accredited Investor Status. Purchaser is an “Accredited Investor” as that term is defined in Rule 501(a) of Regulation D, and has completed or caused to be completed the Investor Questionnaire Certification in the form attached
hereto as Exhibit F (the “Investor Questionnaire”), certifying as to its status as an Accredited Investor. Purchaser acknowledges that an investment in the Securities is speculative and involves a high degree of risk, and
Purchaser has such experience in business and financial matters that it is capable of evaluating the merits and risks of an investment in the Securities. Purchaser understands that the Securities are being offered and sold in reliance on a
transactional exemption from the registration requirements of federal and state securities laws and the Company is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments and understandings of Purchaser
set forth herein and in the Investor Questionnaire in order to determine the applicability of such exemptions and the suitability of Purchaser to acquire the Securities. 
  

 - 3 - 

 (e) Information. Purchaser and its counsel, if any, have been furnished all materials relating to
the business, finances and operations of the Company and materials relating to the offer and sale of the Securities which have been specifically requested by such Purchaser or its counsel and which are not available through the SEC’s Electronic
Data Gathering, Analysis and Retrieval (“EDGAR”) system. Neither such inquiries nor any other investigation conducted by such Purchaser or its counsel or any of its representatives shall modify, amend or affect such Purchaser’s
right to rely on the Company’s representations and warranties contained in Section 3 below. Purchaser acknowledges that it has been given full access to such records of the Company and each of its direct and indirect subsidiaries
(collectively, the “Subsidiaries”) and to the officers of the Company and the Subsidiaries as it has deemed necessary or appropriate to conduct its due diligence investigation. 
  
 (f) Governmental Review. Purchaser understands that no U.S. federal or
state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Securities. 
  
 (g) No General Solicitation. Purchaser acknowledges that the Securities were not offered to it by means of any form of general or public
solicitation or general advertising, or publicly disseminated advertisements or sales literature, including (i) any advertisement, article, notice or other communication published in any newspaper, magazine, or similar media, or broadcast over
television or radio, or (ii) any seminar or meeting to which such Purchaser was invited by any of the foregoing means of communications. 
  
 (h) Authorization; Enforcement. Purchaser has the requisite power and authority to enter into and perform this Agreement and the Registration
Rights Agreement and to purchase the Securities being sold to it hereunder. The execution, delivery and performance of this Agreement and the Registration Rights Agreement by Purchaser and the consummation by it of the transactions contemplated
hereby have been duly authorized by all necessary corporate, limited liability company or partnership action, and no further consent or authorization of Purchaser or its Board of Directors, stockholders, members or partners, as the case may be, is
required. When executed and delivered by Purchaser, this Agreement and the Registration Rights Agreement shall constitute valid and binding obligations of Purchaser enforceable against it in accordance with their terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of, creditor’s rights and remedies or by other
equitable principles of general application. 
  
 (i)
Independent Investment. Purchaser has not agreed to act with any other Purchaser for the purpose of acquiring, holding, voting or disposing of the Securities purchased hereunder for purposes of Section 13(d) under the Securities Exchange Act
of 1934, as amended (the “Exchange Act”), and Purchaser is acting independently with respect to its investment in the Securities. 
  
 (j) Residency. Purchaser is a resident of the jurisdiction set forth under Purchaser’s name on the Execution Page hereto executed by
Purchaser. 
  

 - 4 - 

 Except for subsections (a), (c) and (h), each Purchaser’s representations and warranties made in
this Article 2 are made solely for the purpose of permitting the Company to make a determination that the offer and sale of the Securities pursuant to this Agreement comply with applicable U.S. federal and state securities laws and not for any other
purpose. Accordingly, the Company may not rely on such representations and warranties for any other purpose. No Purchaser has made or hereby makes any other representations or warranties, express or implied, to the Company in connection with the
transactions contemplated hereby. 
  

	3.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY. 

  
 Except as set forth on a Disclosure Schedule executed and delivered by the Company to each Purchaser (the “Disclosure Schedule”), the
Company represents and warrants to each Purchaser as follows: 
  
 (a) Organization and Qualification. The Company and each of its Subsidiaries is a corporation or other entity duly organized and existing in good standing under the laws of the jurisdiction in which it is incorporated or organized,
and has the requisite corporate power to own its properties and to carry on its business as now being conducted. The Company and each of its Subsidiaries is duly qualified as a foreign corporation or other entity to do business and is in good
standing in every jurisdiction in which the nature of the business conducted by it makes such qualification necessary and where the failure so to qualify or be in good standing would have a Material Adverse Effect. For purposes of this Agreement,
“Material Adverse Effect” means any effect which, individually or in the aggregate with all other effects, reasonably would be expected to be materially adverse to (i) the ability of the Company to perform its obligations under this
Agreement or the other Transaction Documents, or (ii) the business, operations, properties, reasonable prospects, financial condition or results of operations of the Company and its Subsidiaries, taken as a whole; provided, however, to the
extent such effect results solely from any of the following, such effect shall not be considered a Material Adverse Effect: (i) general conditions applicable to the economy of the United States or elsewhere, including changes in interest rates and
changes in the stock or other financial markets; (ii) conditions generally affecting the telecommunications industry; or (iii) conditions or effects resulting from or relating to the announcement or the existence or terms of this Agreement or the
Con Ed Agreement or the consummation of the transactions contemplated hereby or thereby. 
  
 (b) Authorization; Enforcement. (i) Except as described in Section 3(c) below, the Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement
and the other Transaction Documents, to amend and restate the SDS Warrants, to issue and sell the Units in accordance with the terms hereof, to issue Redemption Preferred Stock (as defined in Section 4(cc) below) in exchange for Preferred
Stock in accordance with the terms hereof, to issue Conversion Shares upon conversion of the Preferred Stock in accordance with the terms thereof, to issue Redemption Shares (as defined in Section 4(e) below) upon conversion of Redemption
Preferred Stock in accordance with the terms thereof, and to issue the Warrant Shares upon exercise of the Warrants in accordance with the terms thereof; (ii) the execution, delivery and performance of this Agreement and the other Transaction
Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby (including, without limitation, amendment and restatement of 

  

 - 5 - 

 
the SDS Warrants, the issuance of the Units and Redemption Preferred Stock and the issuance and reservation for issuance of the Conversion Shares, Redemption
Shares and Warrant Shares) have been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or any committee of the Board of Directors is required, and (iii) this
Agreement, the Registration Rights Agreement and the Amended Warrants constitute, and, upon execution and delivery by the Company of the other Transaction Documents and any Certificate of Designation, Preferences and Rights for Redemption Preferred
Stock (each such Certificate of Designation, Preferences and Rights, a “Redemption Certificate” and collectively, the “Redemption Certificates”), such Transaction Documents and the Redemption Certificate will
constitute, valid and binding obligations of the Company enforceable against the Company in accordance with their terms. 
  
 (c) Stockholder Authorization. Neither the execution, delivery or performance by the Company of this Agreement, the other Transaction Documents,
and the Redemption Certificates nor the consummation by it of the transactions contemplated hereby or thereby (including, without limitation, amendment and restatement of the SDS Warrants, the issuance of the Preferred Stock, Redemption Preferred
Stock and Warrants or the issuance or reservation for issuance of the Conversion Shares, Redemption Shares and Warrant Shares) requires any consent or authorization of the Company’s stockholders, except that the issuance of the Conversion
Shares, the Redemption Shares and the Warrant Shares and any other shares of Common Stock issuable in connection with the Preferred Stock, any series of Redemption Preferred Stock and the Warrants requires the approval of the Company’s
stockholders pursuant to Rule 4350(i) promulgated by the National Association of Securities Dealers, Inc. (the “Stockholder Approval”). 
  
 (d) Capitalization. The capitalization of the Company as of the date hereof, including the authorized capital stock, the number of shares issued
and outstanding, the number of shares issuable and reserved for issuance pursuant to the Company’s stock option plans, the number of shares issuable and reserved for issuance pursuant to securities (other than the Preferred Stock, Redemption
Preferred Stock and the Warrants) exercisable or exchangeable for, or convertible into, any shares of capital stock and the number of shares to be reserved for issuance upon conversion of the Preferred Stock and exercise of the Warrants is set forth
in Section 3(d) of the Disclosure Schedule. All of such outstanding shares of capital stock have been, or upon issuance in accordance with the terms of any such exercisable, exchangeable or convertible securities will be, validly issued,
fully paid and non-assessable. No shares of capital stock of the Company (including the Conversion Shares, the Redemption Shares, the Warrant Shares and the shares of common stock underlying the Amended Warrants) are subject to preemptive rights or
any other similar rights of the stockholders of the Company or any liens or encumbrances. Except for this Agreement, the Registration Rights Agreement, the Securities and as set forth in Section 3(d) of the Disclosure Schedule, (i) there are
no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into or exercisable or exchangeable for, any shares of capital stock of the Company or
any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries, nor are
any such issuances, contracts, commitments, understandings or arrangements contemplated, (ii) there are no contracts, 

  

 - 6 - 

 
commitments, understandings or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of its or their
securities under the Securities Act (except the Registration Rights Agreement); (iii) there are no outstanding securities or instruments of the Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no
contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem or otherwise acquire any security of the Company or any of its Subsidiaries; and (iv) the Company does not have
any shareholder rights plan, “poison pill” or other anti-takeover plans or similar arrangements. Section 3(d) of the Disclosure Schedule sets forth all of the securities or instruments issued by the Company or any of its
Subsidiaries that contain anti-dilution or similar provisions, and, except as and to the extent set forth thereon, the sale and issuance of the Securities and the issuance of Redemption Preferred Stock or Redemption Shares will not trigger any
anti-dilution adjustments to any such securities or instruments. The Company has furnished to each Purchaser true and correct copies of the Company’s Amended and Restated Certificate of Incorporation as in effect on the date hereof (the
“Certificate of Incorporation”), the Company’s Bylaws as in effect on the date hereof (the “Bylaws”), and all other instruments and agreements governing securities convertible into or exercisable or
exchangeable for capital stock of the Company which are not available to the Purchaser via EDGAR, all of which instruments and agreements are set forth in Section 3(d) of the Disclosure Schedule. Except as set forth in Section 3(d) of
the Disclosure Schedule, the Company’s Certificate of Incorporation and Bylaws have not been amended since the date hereof and remain in full force and effect. The Company or one of its Subsidiaries has the unrestricted right to vote, and
(subject to limitations imposed by applicable law) to receive dividends and distributions on, all capital securities of its Subsidiaries as owned by the Company or any such Subsidiary. 
  
 (e) Issuance of Securities. On or prior to the Closing Date, the Units (and the securities comprising the Units) and
Redemption Preferred Stock will be duly authorized and, upon issuance in accordance with the terms of this Agreement, (i) will be validly issued, fully paid and non-assessable and free from all taxes, liens, claims and encumbrances, (ii) will not be
subject to preemptive rights, rights of first refusal or other similar rights of stockholders of the Company or any other person and (iii) will not impose personal liability on the holder thereof. On or prior to the Closing Date, Conversion Shares,
Redemption Shares and Warrant Shares will be duly authorized and reserved for issuance, and, upon conversion of the Preferred Stock and Redemption Preferred Stock and upon exercise of the Warrants in accordance with the terms thereof, (x) will be
validly issued, fully paid and non-assessable, and free from all taxes, liens, claims and encumbrances, (y) will not be subject to preemptive rights, rights of first refusal or other similar rights of stockholders of the Company or any other person
and (z) will not impose personal liability upon the holder thereof. 
  
 (f) No Conflicts; Consents. The execution, delivery and performance of this Agreement, each Redemption Certificate and the other Transaction Documents by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby (including, without limitation, amendment and restatement of the SDS Warrants, the issuance of the Units and Redemption Preferred Stock and the issuance and reservation for issuance of the Conversion Shares, the
Redemption Shares and the Warrant Shares in accordance with the terms of the Certificate of Designation, the Redemption Certificates and the Warrant, respectively) will 

  

 - 7 - 

 
not (i) result in a violation of the Certificate of Incorporation or Bylaws, (ii) conflict with, or constitute a default (or an event that with notice or
lapse of time or both would become a default) under, or give to others any rights of termination, amendment (including, without limitation, the triggering of any anti-dilution provisions), acceleration or cancellation of, any agreement, indenture or
instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including U.S. federal and state securities laws, rules and regulations; rules and
regulations of any self-regulatory organizations to which either the Company or its securities are subject; the Communications Act of 1934, as amended (the “Communications Act”); and any state statute or administrative code sections
applicable to public utilities, which collectively with the Communications Act are the “Regulatory Laws”) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its
Subsidiaries is bound or affected, or (iv) result in the revocation, cancellation, rescission or adverse modification of (A) any authorization, license or permit issued by the Federal Communications Commission (the “FCC”) or (B) any
authorization or certification issued by a State Public Utility Commission (collectively the “Governing PUCs”) (except, with respect to clauses (ii) and (iii), for such conflicts, defaults, terminations, amendments, accelerations,
cancellations and violations that would not, individually or in the aggregate, have a Material Adverse Effect). Except (w) as may be required under the Securities Act in connection with the performance of the Company’s obligations under the
Registration Rights Agreement, (x) for the filing of a Form D with the SEC, and (y) as may be required for compliance with applicable state securities or “blue sky” laws, the Company is not required to obtain any consent, approval,
authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory or self-regulatory agency or other third party, including the FCC and Governing PUCs (including, without limitation, pursuant to
any Material Contract (as defined in Section 3(h) below)), in order for it to execute, deliver or perform any of its obligations under this Agreement, the Redemption Certificates or any of the other Transaction Documents. 
  
 (g) Compliance. The Company is not in violation of its Certificate of
Incorporation, Bylaws or other organizational documents and no Subsidiary is in violation of any of its organizational documents. Neither the Company nor any of its Subsidiaries is in default (and no event has occurred that with notice or lapse of
time or both would put the Company or any of its Subsidiaries in default) under, nor has there occurred any event giving others (with notice or lapse of time or both) any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party (including, without limitation, the Material Contracts), except for actual or possible violations, defaults or rights that would not, individually or in
the aggregate, have a Material Adverse Effect. The businesses of the Company and its Subsidiaries are not being conducted in violation of any law, ordinance or regulation of any governmental entity, including the Regulatory Laws, except for possible
violations the sanctions for which either individually or in the aggregate have not had and would not have a Material Adverse Effect. Neither the Company, nor any of its Subsidiaries, nor any director, officer, agent, employee or other person acting
on behalf of the Company or any Subsidiary has, in the course of his actions for, or on behalf of, the Company or any Subsidiary, used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to
political activity, made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds, 

  

 - 8 - 

 
violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, or made any bribe, rebate, payoff, influence payment,
kickback or other unlawful payment to any foreign or domestic government official or employee. The Company and its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, provincial or foreign
regulatory authorities, except where the failure to so possess such certificates, authorizations and permits would not have a Material Adverse Effect, and neither the Company nor any of its Subsidiaries has received any notice of any decree, ruling,
injunction, action or proceeding (“Proceeding”) relating to the revocation or modification of any such certificate, authorization or permit and there is not issued or outstanding or, to the Company’s knowledge, any pending or
threatened Proceeding, investigation or complaint with the FCC and Governing PUCs with respect to the Company or its Subsidiaries, except where such Proceeding, or pending or threatened Proceeding, investigation or complaint, would not reasonably be
expected to have a Material Adverse Effect. The Company and its Subsidiaries have filed all reports, forms, applications and statements required to be filed with the FCC and Governing PUCs under the Regulatory Laws except where the failure to file
such reports, forms, applications and statements would not have a Material Adverse Effect. 
  
 (h) SEC Documents, Financial Statements. Since December 31, 1998, the Company has timely filed (within applicable extension periods) all reports, schedules, forms, statements and other documents required to be
filed by it with the SEC pursuant to the Securities Act and the reporting requirements of the Exchange Act (all of the foregoing filings and all exhibits included therein and financial statements and schedules thereto and documents incorporated by
reference therein, the “SEC Documents”). As of their respective dates, the SEC Documents complied in all respects with the requirements of the Exchange Act or the Securities Act, as the case may be, and the rules and regulations of
the SEC promulgated thereunder applicable to the SEC Documents, except to the extent that a failure to so comply would not have a Material Adverse Effect, and none of the SEC Documents, at the time they were filed with the SEC, contained any untrue
statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the statements
made in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings). As of their respective dates, the financial statements of the
Company included in the SEC Documents complied as to form in all respects with applicable accounting requirements and the published rules and regulations of the SEC applicable with respect thereto, except to the extent that a failure to so comply
would not have a Material Adverse Effect. Such financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), consistently applied, during the periods involved (except as may be
otherwise indicated in such financial statements or the notes thereto or, in the case of unaudited interim statements, to the extent they may not include footnotes or may be condensed or summary statements) and fairly present in all material
respects the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited
statements, to normal, immaterial year-end audit adjustments). Except as set forth in the financial statements of the Company included in the Select SEC Documents (as defined below), the Company has no liabilities, contingent or otherwise, other
than (i) liabilities incurred in the ordinary course of 

  

 - 9 - 

 
business subsequent to the date of such financial statements and (ii) obligations under contracts and commitments incurred in the ordinary course of business
and not required under GAAP to be reflected in such financial statements, which liabilities and obligations referred to in clauses (i) and (ii), individually or in the aggregate, will not have a Material Adverse Effect. To the extent required by the
rules and regulations of the SEC applicable thereto, the Select SEC Documents contain a complete and accurate list of all material undischarged written or oral contracts, agreements, leases or other instruments to which the Company or any Subsidiary
is a party or by which the Company or any Subsidiary is bound or to which any of the properties or assets of the Company or any Subsidiary is subject (each, a “Material Contract”). Except as set forth in the Select SEC Documents,
none of the Company, its Subsidiaries or, to the best knowledge of the Company, any of the other parties thereto is in breach or violation of any Material Contract, which breach or violation would have a Material Adverse Effect. For purposes of this
Agreement, “Select SEC Documents” means the Company’s (A) Proxy Statement for its 2004 Annual Meeting, (B) Annual Report on Form 10-K for the fiscal year ended December 31, 2003 (the “2003 Annual Report”), (C)
Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2004, June 30, 2004, and September 30, 2004 and Current Report on Form 8-K filed August 20, 2004. 
  
 (i) Internal Accounting Controls. The Company and each of its Subsidiaries maintains a system of internal accounting
controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements
in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the
existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and
designed such disclosures controls and procedures to ensure that material information relating to the Company, including its Subsidiaries, is made known to the certifying officers by others within those entities, particularly during the period in
which the Company’s Annual Report on Form 10-K or Quarterly Reports on Form 10-Q, as the case may be, are being prepared. The Company’s certifying officers have evaluated the effectiveness of the Company’s controls and procedures as
of December 31, 2003 and September 30, 2004 (each such date, an “Evaluation Date”). The Company presented in the 2003 Annual Report and its most recently filed Quarterly Report on Form 10-Q the conclusions of the certifying officers
about the effectiveness of the disclosure controls and procedures based on their evaluations as of the respective Evaluation Date. Since the Evaluation Date for the 2003 Annual Report, there have been no significant changes in the Company’s
internal controls (as such term is defined in Item 307(b) of Regulation S-K under the Exchange Act) or, to the Company’s knowledge, in other factors that could significantly affect the Company’s internal controls. 
  
 (j) Absence of Certain Changes. Except as set forth in the Select SEC
Documents, since December 31, 2003, there has been no adverse change and no adverse development in the business, properties, operations, prospects, financial condition or results of operations of the Company and its Subsidiaries, except for such
changes or developments that would not have a Material Adverse Effect. The Company has not taken any steps, and does not currently expect to 

  

 - 10 - 

 
take any steps, to seek protection pursuant to any bankruptcy or receivership law, nor does the Company or any of its Subsidiaries have any knowledge or
reason to believe that its creditors intend to initiate involuntary bankruptcy proceedings with respect to the Company or any of its Subsidiaries. 
  
 (k) Transactions With Affiliates. Except as set forth in the Select SEC Documents, none of the officers, directors, or employees of the Company or
any of its Subsidiaries is presently a party to any transaction with the Company or any of its Subsidiaries (other than for ordinary course services solely in their capacity as officers, directors or employees), including any contract, agreement or
other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any such officer, director or employee or any corporation, partnership,
trust or other entity in which any such officer, director, or employee has an ownership interest of five percent or more or is an officer, director, trustee or partner. 
  
 (l) Absence of Litigation. Except as disclosed in the Select SEC Documents, there is no action, suit, Proceeding,
inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body (including, without limitation, the SEC) pending or, to the knowledge of the Company or any of its Subsidiaries, threatened
against or affecting the Company, any of its Subsidiaries, or any of their respective directors or officers in their capacities as such. To the Company’s knowledge, there are no facts which, if known by a potential claimant or governmental
authority, could give rise to a claim or Proceeding which, if asserted or conducted with results unfavorable to the Company or any of its Subsidiaries, could reasonably be expected to have a Material Adverse Effect. 
  
 (m) Tax Status. Except as set forth in the Select SEC Documents, the
Company and each of its Subsidiaries has made or filed all foreign, U.S. federal, state, provincial and local income and all other tax returns, reports and declarations required by any jurisdiction to which it is subject (unless and only to the
extent that the Company and each of its Subsidiaries has set aside on its books provisions reasonably adequate for the payment of all unpaid and unreported taxes) and has paid all taxes and other governmental assessments and charges, shown or
determined to be due on such returns, reports and declarations, except those being contested in good faith, and has set aside on its books provisions reasonably adequate for the payment of all taxes for periods subsequent to the periods to which
such returns, reports or declarations apply, or those where the failure to so pay would not result in a Material Adverse Effect. There are no unpaid taxes in any amount claimed to be due by the taxing authority of any jurisdiction, and the officers
of the Company know of no basis for any such claim, except where the failure to so pay would not result in a Material Adverse Effect. The Company has not executed a waiver with respect to any statute of limitations relating to the assessment or
collection of any foreign, federal, state, provincial or local tax. None of the Company’s tax returns is presently being audited by any taxing authority. 
  

(n) Environmental Matters. There is no environmental litigation or other environmental Proceeding pending or, to the knowledge of the Company or
any of its Subsidiaries, threatened by any governmental regulatory authority or others with respect to the current or any former business of the Company or any of its Subsidiaries or any partnership or 

  

 - 11 - 

 
joint venture currently or at any time affiliated with the Company or any of its Subsidiaries. No state of facts exists as to environmental matters or
Hazardous Substances (as defined below) that involves the reasonable likelihood of resulting in a capital expenditure by the Company or any of its Subsidiaries that may result in a Material Adverse Effect. No Hazardous Substances have been treated,
stored or disposed of, or otherwise deposited, in or on the properties owned or leased by the Company or any of its Subsidiaries or by any partnership or joint venture currently or at any time affiliated with the Company or any of its Subsidiaries
in violation of any applicable environmental laws. The environmental compliance programs of the Company and each of its Subsidiaries comply in all respects with all environmental laws, whether foreign, federal, state, provincial or local, currently
in effect. For purposes of this Agreement, “Hazardous Substances” means any substance, waste, contaminant, pollutant or material that has been determined by any governmental authority to be capable of posing a risk of injury to
health, safety, property or the environment. 
  
 (o)
Listing. The Common Stock is currently listed for trading on the Nasdaq SmallCap Market (the “SmallCap Market”). Except as set forth in the Company’s Current Report on Form 8-K filed on August 20, 2004, the Company is
not in violation of the listing requirements of the SmallCap Market, and neither the SEC nor the SmallCap Market has suspended or threatened to suspend trading in the Common Stock on the SmallCap Market. 
  
 (p) Form S-3 Eligibility. The Company is eligible to register the
resale of its Common Stock on a registration statement on Form S-3 under the Securities Act. There exist no facts or circumstances that would prohibit or delay the preparation and filing of a registration statement on Form S-3 with respect to the
Registrable Securities (as defined in the Registration Rights Agreement). The Company has no basis to believe that its past or present independent public auditors will withhold their consent to the inclusion, or incorporation by reference, of their
audit opinion concerning the Company’s financial statements which are to be included in the Registration Statement required to be filed pursuant to the Registration Rights Agreement. 
  
 (q) Anti-Takeover Provisions. The Company and its board of directors have taken all necessary action, if any, in
order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under its Certificate of Incorporation or the laws of the
state of its incorporation which is or could become applicable to any Purchaser as a result of the transactions contemplated by this Agreement, including, without limitation, the Company’s issuance of the Securities, Redemption Preferred Stock
and the Redemption Shares and any and all Purchaser’s ownership of the Securities, Redemption Preferred Stock or Redemption Shares, including, without limitation, § 203 of the Delaware General Corporation Law. 
  
 (r) Acknowledgment Regarding Each Purchaser’s Purchase of the
Securities. The Company acknowledges and agrees that each Purchaser is acting solely in the capacity of an arm’s length purchaser with respect to this Agreement and the other Transaction Documents and the transactions contemplated hereby
and thereby, and that no Purchaser is (i) an officer or director of the Company, or (ii) an “affiliate” of the Company (as defined in Rule 144 under the Securities Act (including any successor rule, “Rule 144”)). The
Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar 

  

 - 12 - 

 
capacity) with respect to this Agreement, the Redemption Certificates or the other Transaction Documents and the transactions contemplated hereby and
thereby, and any advice given by a Purchaser or any of its representatives or agents in connection with this Agreement, the Redemption Certificates or the other Transaction Documents and the transactions contemplated hereby and thereby is merely
incidental to such Purchaser’s purchase of the Securities. The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement, the other Transaction Documents and, if necessary, the Redemption
Certificate or Redemption Certificates, has been based solely on the independent evaluation by the Company and its representatives. 
  
 (s) No General Solicitation or Integrated Offering. Neither the Company nor any distributor participating on the Company’s behalf in the
transactions contemplated hereby (if any) nor any person acting for the Company, or any such distributor, has conducted any “general solicitation” (as such term is defined in Regulation D) with respect to any of the Securities being
offered hereby. Neither the Company nor any of its affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales of any security or solicited any offers to buy any security under circumstances that
would require registration of the Securities being offered hereby under the Securities Act or cause this offering of Securities to be integrated with any prior offering of securities of the Company for purposes of the Securities Act, which result of
such integration would require registration under the Securities Act, or any applicable stockholder approval provisions. 
  
 (t) No Brokers. The Company has taken no action that would give rise to any claim by any person for brokerage commissions, finder’s fees or
similar payments by any Purchaser relating to this Agreement or the transactions contemplated hereby. 
  
 (u) Acknowledgment Regarding Securities. The number of Conversion Shares and Redemption Shares issuable upon conversion of the Preferred Stock and
Redemption Preferred Stock, respectively, and the number of Warrant Shares issuable upon exercise of the Warrants may increase in certain circumstances. The Company’s directors and executive officers have studied and fully understand the nature
of the Securities being sold hereunder. The Company acknowledges that its obligation to issue Conversion Shares upon conversion of the Preferred Stock in accordance with the terms thereof, Redemption Shares upon conversion of Redemption Preferred
Stock in accordance with the terms thereof, and the Warrant Shares upon the exercise of the Warrants in accordance with the terms thereof is absolute and unconditional, regardless of the dilution that such issuance may have on the ownership
interests of other stockholders and the availability of remedies provided for in any of the Transaction Documents or the Redemption Certificates relating to a failure or refusal to issue Conversion Shares, Redemption Shares or Warrant Shares. Taking
the foregoing into account, as of the date hereof, the Company’s Board of Directors has determined in its good faith business judgment that the issuance of the Units hereunder and the consummation of the other transactions contemplated hereby
are in the best interests of the Company and its stockholders. 
  
 (v) Disclosure. All information relating to or concerning the Company and/or any of its Subsidiaries set forth in this Agreement or provided to the Purchasers pursuant to Section 2(d) or otherwise in connection with the
transactions contemplated hereby is true and correct in all 

  

 - 13 - 

 
respects and the Company has not omitted to state any fact necessary in order to make the statements made herein or therein, in light of the circumstances
under which they were made, not misleading, except for information relating to facts or events that will not have a Material Adverse Effect. No event or circumstance has occurred or exists with respect to the Company or its Subsidiaries or their
respective businesses, properties, prospects, operations or financial conditions, which has not been publicly disclosed but, under applicable law, rule or regulation, would be required to be disclosed by the Company in a registration statement filed
on the date hereof by the Company under the Securities Act with respect to a primary issuance of the Company’s securities. 
  
 (w) Con Ed Assets. To the Company’s knowledge, each reference to the Con Ed Assets in the Con Ed Agreement is accurate. To the best of the
Company’s knowledge, there is not issued, outstanding, pending or threatened any investigation or complaint with the FCC and Governing PUCs with respect to the Con Ed Assets, and Con Ed Holdings has filed all reports, forms, applications and
statements required to be filed with the FCC and Governing PUCs under the Regulatory Laws. 
  

	4.	COVENANTS. 

  
 (a) Best Efforts. The parties shall use their respective best efforts timely to satisfy each of the conditions described in Sections 6 and 7
of this Agreement. 
  
 (b) Form D; Blue Sky Laws. The
Company shall file with the SEC a Form D with respect to the Securities as required under Regulation D and provide a copy thereof to each Purchaser promptly after such filing. The Company shall, on or before the Closing Date, take such action as the
Company shall reasonably determine is necessary to qualify the Securities for sale to each Purchaser pursuant to this Agreement under applicable securities or “blue sky” laws of the states of the United States or obtain exemption
therefrom, and shall provide evidence of any such action so taken to each Purchaser on or prior to the Closing Date. Within four business days after the date hereof, the Company shall file a Form 8-K with the SEC concerning this Agreement and the
transactions contemplated hereby, which Form 8-K shall attach this Agreement and its Exhibits as exhibits to such Form 8-K (the “8-K Filing”). As of the date of the 8-K Filing, the Company hereby acknowledges that no Purchaser shall
be in possession of any material nonpublic information received from the Company, any of its Subsidiaries or any of its or their respective officers, directors, employees or agents, that is not disclosed in the 8-K Filing. The Company shall not, and
shall cause each of its Subsidiaries and its and each of their respective officers, directors, employees and agents not to, provide any Purchaser with any material nonpublic information regarding the Company or any of its Subsidiaries from and after
the 8-K Filing without the express written consent of such Purchaser; provided, however, that a Purchaser that exercises its rights under Section 4(i) shall be deemed to have given such express written consent. In the event of a
breach of the foregoing covenant by the Company, any of its Subsidiaries or any of its or their respective officers, directors, employees and agents, in addition to any other remedy provided herein or in the other Transaction Documents, a Purchaser
shall have the right to make a public disclosure, in the form of a press release, public advertisement or otherwise, of such material nonpublic information without the prior approval by the Company, its Subsidiaries or any of its or their respective
officers, directors, employees or agents. No 

  

 - 14 - 

 
Purchaser shall have any liability to the Company, its Subsidiaries or any of its or their respective officers, directors, employees, shareholders or agents
for any such disclosure. Subject to the foregoing, neither the Company nor any Purchaser shall issue any press releases or any other public statements with respect to the transactions contemplated hereby; provided, however, that the
Company shall be entitled, without the prior approval of any Purchaser, to make any press release or other public disclosure with respect to such transactions (i) in substantial conformity with the 8-K Filing and contemporaneously therewith and (ii)
as is required by applicable law and regulations (provided that in the case of clause (i) each Purchaser shall be consulted by the Company in connection with any such press release or other public disclosure prior to its release). 
  
 (c) Reporting Status. So long as at least 5% of the Preferred Stock or
any series of Redemption Preferred Stock remains outstanding, but in any event for at least three years following the Closing, the Company shall timely file all reports required to be filed with the SEC pursuant to the Exchange Act, and the Company
shall not terminate its status as an issuer required to file reports under the Exchange Act even if the Exchange Act or the rules and regulations thereunder would permit such termination. In addition, the Company shall take all commercially
reasonable actions necessary to meet the “registration eligibility” requirements set forth in the general instructions to Form S-3 or any successor form thereto, to continue to be eligible to register the resale of its Common Stock on a
registration statement on Form S-3 under the Securities Act. 
  
 (d) Use of Proceeds. The Company shall use the proceeds from the sale and issuance of the Units solely for the purposes set forth in Section E of the Background portion of this Agreement. 
  
 (e) Reservation of Shares. The Company currently has authorized and
reserved for the purpose of issuance 100,000,000 shares of Common Stock to provide for the full conversion of the Preferred Stock and Redemption Preferred Stock (the shares of Common Stock issuable upon conversion of Redemption Preferred Stock are
referred to herein as the “Redemption Shares”) and issuance of the Conversion Shares and Redemption Shares in connection therewith, the full exercise of the Warrants and the issuance of the Warrant Shares in connection therewith and
as otherwise required by the Preferred Stock, any series of Redemption Preferred Stock, the Warrants and the Registration Rights Agreement (collectively, the “Issuance Obligations”). In the event such number of shares becomes
insufficient to satisfy the Issuance Obligations, the Company shall take all necessary action to authorize and reserve such additional shares of Common Stock necessary to satisfy the Issuance Obligations. 
  
 (f) Listing. 
  
 (i) At least fifteen days prior to the Closing Date, the
Company shall file a Listing of Additional Shares Application (the “Shares Application”) with Nasdaq that shall include copies of the Transaction Documents, and, as of the Closing Date, the Company shall not have received notice of
a rejection of such application with respect to the listing of the Conversion Shares and the Warrant Shares on the SmallCap Market. Upon any issuance of Redemption Preferred Stock, the Company shall amend the Shares Application or file an 

  

 - 15 - 

 
additional Listing of Additional Shares Application with Nasdaq regarding the Redemption Shares applicable thereto. 
  
 (ii) So long as any Purchasers (or any of their respective
affiliates) beneficially own any of the Securities, Redemption Preferred Stock or Redemption Shares, the Company shall (i) list, and maintain the listing of, all Conversion Shares, Redemption Shares and Warrant Shares from time to time issuable upon
conversion of the Preferred Stock and Redemption Preferred Stock and upon exercise of the Warrants on the SmallCap Market, (ii) maintain the listing and trading of its Common Stock on the SmallCap Market, and (iii) shall comply in all respects with
the reporting, filing and other obligations under the bylaws or rules of the National Association of Securities Dealers, Inc. (the “NASD”). The Company shall promptly provide to each Purchaser copies of any notices it receives
regarding the continued eligibility of the Common Stock for trading on the SmallCap Market. 
  
 (g) Corporate Existence. So long as at least 5% of the Preferred Stock or any series of Redemption Preferred Stock remains outstanding, but in any event for at least three years following the Closing, the
Company shall maintain its corporate existence, and in the event of a merger, consolidation or sale of all or substantially all of the Company’s assets, the Company shall ensure that the surviving or successor entity in such transaction (i)
assumes the Company’s obligations under this Agreement, any Redemption Certificate and the other Transaction Documents and the agreements and instruments entered into in connection herewith and therewith regardless of whether or not the Company
would have had a sufficient number of shares of Common Stock authorized and available for issuance in order to effect the conversion of all the Preferred Stock and Redemption Preferred Stock and exercise in full of all Warrants outstanding as of the
date of such transaction and (ii) except in the event of a merger, consolidation of the Company into any other corporation, or the sale or conveyance of all or substantially all of the assets of the Company where the consideration consists solely of
cash, the surviving or successor entity is a publicly traded corporation whose common stock is listed for trading on the SmallCap Market, the National Market, the NYSE or the AMEX. 
  
 (h) No Integrated Offerings. The Company shall not make any offers or sales of any security (other than the
Securities) under circumstances that would require registration of the Securities being offered or sold hereunder under the Securities Act or cause this offering of the Securities to be integrated with any other offering of securities by the Company
for purposes of any stockholder approval provision applicable to the Company or its securities. 
  
 (i) Legal Compliance. The Company shall conduct its business and the business of its Subsidiaries in compliance with all statutes, rules, executive
orders, laws, ordinances or regulations (“Governmental Regulations”) of governmental entities applicable to such businesses, including the Regulatory Laws, except where the failure to do so would not have a Material Adverse Effect.

  
 (j) Redemptions, Dividends and Repayments of
Indebtedness. From the date hereof until the Closing (assuming for purposes of this Section 4(j) that the Preferred Stock was outstanding as of the date hereof), and thereafter, for so long as at least 5% of the Preferred Stock or any
series of Redemption Preferred Stock remains outstanding, the Company shall not, 

  

 - 16 - 

 
without first obtaining the written approval of the holders of a majority of the shares of Preferred Stock and Redemption Preferred Stock then outstanding
(which approval may be given or withheld by such holders in their sole and absolute discretion), repurchase, redeem or declare or pay any cash dividend or distribution on any shares of capital stock of the Company. 
  
 (k) Information. The Company shall keep at its principal executive
office a true copy of this Agreement (as at the time in effect), and cause the same to be available for inspection at such office during normal business hours by any holder of Securities, Redemption Preferred Stock or Redemption Shares or any
prospective transferee of Securities, Redemption Preferred Stock or Redemption Shares designated by a holder thereof. 
  
 (l) Inspection of Properties and Books. From the date hereof until the Closing, and thereafter, for so long as any of the Preferred Stock or
Redemption Preferred Stock remains outstanding, each Purchaser and its representatives and agents (collectively, the “Inspectors”) shall have the right, at such Purchaser’s expense, to visit and inspect any of the properties of
the Company and of its Subsidiaries, to examine the books of account and records of the Company and of its Subsidiaries, to make or be provided with copies and extracts therefrom, to discuss the affairs, finances and accounts of the Company and of
its Subsidiaries with, and to be advised as to the same by, its and their officers, employees and independent public accountants (and by this provision the Company authorizes such accountants to discuss such affairs, finances and accounts, whether
or not a representative of the Company is present) all at such reasonable times and intervals and to such reasonable extent as the Purchasers may desire; provided, however, that each Inspector shall hold in confidence and shall not
make any disclosure (except to such Purchaser) of any such information which the Company determines in good faith to be confidential, and of which determination the Inspectors are so notified, unless (i) the disclosure of such information is
necessary to avoid or correct a misstatement or omission in any Registration Statement filed pursuant to the Registration Rights Agreement, (ii) the release of such information is ordered pursuant to a subpoena or other order from a court or
government body of competent jurisdiction, or (iii) such information has been made generally available to the public other than by disclosure in violation of this or any other agreement. Each Purchaser agrees that it shall, upon learning that
disclosure of such information is sought in or by a court or governmental body of competent jurisdiction or through other means, give prompt notice to the Company and allow the Company, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, the information deemed confidential. In each case above, the Company shall be deemed to have satisfied its obligations under this Section 4(l) so long as it employs commercially reasonable
efforts to allow each Purchaser to exercise its rights set forth in this Section 4(l). 
  
 (m) Shareholders Rights Plan. No claim shall be made or enforced by the Company that any Purchaser is an “Acquiring Person” under any shareholders rights plan or similar plan or arrangement in effect
or hereafter adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities, Redemption Preferred Stock or Redemption Shares under this Agreement, a
Redemption Certificate or any other Transaction Documents or under any other agreement between the Company and the Purchasers. 
  

 - 17 - 

 (n) Pledge of Securities. The Company acknowledges and agrees that the Securities, the Redemption
Preferred Stock and the Redemption Shares may be pledged by any Purchaser in connection with a bona fide margin agreement or other loan or financing arrangement that is secured by the Securities, Redemption Preferred Stock or Redemption Shares. The
pledge of Securities, Redemption Preferred Stock or Redemption Shares shall not be deemed to be a transfer, sale or assignment of the Securities, the Redemption Preferred Stock or the Redemption Shares hereunder, and no Purchaser effecting a pledge
of Securities, Redemption Preferred Stock or Redemption Shares shall be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement, any Redemption Certificate or any other
Transaction Document. The Company shall execute and deliver such documentation as a pledgee of the Securities, Redemption Preferred Stock or Redemption Shares may reasonably request in connection with a pledge of the Securities, the Redemption
Preferred Stock or the Redemption Shares to such pledgee by a Purchaser. 
  
 (o) Variable Securities. From the date hereof until the Closing (assuming for purposes of this Section 4(o) that the Preferred Stock was outstanding as of the date hereof), and thereafter, for so long as
at least 5% of the Preferred Stock or any series of Redemption Preferred Stock remains outstanding, the Company shall not, without first obtaining the written approval of the holders of a majority of the shares of Preferred Stock and Redemption
Preferred Stock then outstanding (which approval may be given or withheld by such holders in their sole and absolute discretion), issue or sell any rights, warrants or options to subscribe for or purchase Common Stock, or any other securities
directly or indirectly convertible into or exchangeable or exercisable for Common Stock, at an effective conversion, exchange or exercise price that varies or may vary with the market price of the Common Stock. For the sake of clarity, this
paragraph shall not prohibit the Company from issuing securities that have a conversion, exchange or exercise price that is fixed and has adjustment to such price based on (i) splits, dividends or other similar corporate actions, or (ii) future
issuance antidilution protection. 
  
 (p) Expenses. Upon
the signing of this Agreement, the Company shall pay to each Purchaser or each Purchaser’s designee reimbursement for the out-of-pocket expenses reasonably incurred by such Purchaser, its affiliates and its or their advisors up through the date
hereof in connection with the negotiation, preparation, execution and delivery of this Agreement and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby, including, without limitation, each
Purchaser’s and their respective affiliates’ and advisors’ reasonable due diligence and attorneys’ fees and expenses (the “Expenses”). In addition, from time to time thereafter, upon any Purchaser’s written
request, the Company shall pay to such Purchaser such additional Expenses, if any, not covered by such payment, in each case to the extent reasonably incurred by such Purchaser, its affiliates or its or their advisors in connection with the
negotiation, preparation, execution and delivery of this Agreement, any Redemption Certificate and the other Transaction Documents and the consummation of the transactions contemplated hereby and thereby. 
  
 (q) Stockholder Approval. The Company shall call a meeting of its
stockholders (the “First Stockholder Meeting”) to be held as promptly as practicable (but in any event no later than 60 days from the date hereof) for the purpose of obtaining Stockholder Approval. The Company shall, upon filing the
applicable proxy statement with the SEC, (i) recommend to its 

  

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stockholders approval of such matters sufficient to obtain Stockholder Approval, (ii) use its best efforts to solicit from its stockholders proxies in favor
of such matters, and (iii) vote such proxies, and use its best efforts to cause all “affiliates” (as such term is defined in Rule 12b-2 promulgated under the Securities Exchange Act of 1934, as amended) of the Company to vote any shares of
Common Stock beneficially owned by such persons or entities (or cause such shares to be voted), in favor of such matters. In connection with its obtaining Stockholder Approval, the Company shall file with the SEC all statements and other documents
required to be filed by it with the SEC pursuant to the reporting requirements of the Exchange Act, and prior to each such filing, shall provide the Purchasers a reasonable period of time to review and comment on the information included therein. If
Stockholder Approval has not been obtained within 60 days of the date hereof, the Company shall immediately notify the Purchasers of such failure, and the Company and its Board of Directors shall continue to use best efforts to obtain Stockholder
Approval and shall include in the Company’s proxy materials for the next annual meeting of the Company’s stockholders (the “Second Stockholder Meeting”), and for each successive annual meeting of the Company’s
stockholders until Stockholder Approval is obtained, a request for Stockholder Approval, and, unless the Board of Directors receives an opinion of counsel advising that such recommendation would constitute a breach of the Directors’ fiduciary
duties imposed by applicable law, shall recommend without qualification that the Company’s stockholders vote in favor of such approval. All expenses related to the solicitation of proxies with respect to, or otherwise incurred in connection
with, obtaining Stockholder Approval shall be borne by the Company. If Stockholder Approval is not been obtained at the First Stockholder Meeting, the Second Stockholder Meeting shall be held as promptly as practicable (but in any event no later
than May 15, 2005). 
  
 (r) Subsequent Offerings. On or
before the Closing Date, the Purchasers shall have a right of first refusal to participate on a pro rata basis, in accordance with their respective subscriptions to the Purchase Price, in any offering (“Subsequent Offering”) by the
Company of (i) equity or equity-linked securities, or (ii) debt which is convertible into equity or in which there is an equity component (“Additional Securities”) on the same terms and conditions as offered by the Company to the
other purchasers of such Additional Securities, or, if offered solely to the Purchasers, on terms and conditions agreeable to the Company and the Purchasers. At the option of each Purchaser, such Purchaser’s subscription to purchase Units
pursuant to this Agreement shall be reduced dollar for dollar to the extent of such Purchaser’s participation in any Subsequent Offering, provided, however, in such event, the funds invested in the Subsequent Offering shall be set aside and
designated by the Company for use pursuant to Section 4(d). If the total subscription amount for Units has been reduced to zero pursuant to this Section 4(r), this Agreement shall terminate and be of no further force and effect.
Notwithstanding the foregoing, the participation rights granted in this Section 4(r) shall not be applicable to: (A) the issuance of shares of Common Stock upon the exercise or conversion of the Company’s options, warrants or other
securities outstanding as of the date hereof in accordance with the terms of such options or warrants or other securities as in effect on the date hereof; (B) the grant of options to purchase Common Stock, with exercise prices not less than the
market price of the Common Stock on the date of grant, which are issued to employees, officers, directors or consultants of the Company for the primary purpose of soliciting or retaining their employment or service pursuant to an equity compensation
plan approved by the Company’s Board of Directors, and the issuance of shares of Common Stock upon the exercise thereof; (C) the issuance of the Preferred Stock, the 

  

 - 19 - 

 
Warrants and the Amended Warrants pursuant hereto, the Conversion Shares upon conversion of the Preferred Stock and the Warrant Shares upon exercise of the
Warrants; (D) issuances of Common Stock, or warrants or options exercisable for Common Stock, in connection with a strategic arrangement or alliance to building licensors, landlords, carriers, joint venture partners, vendors, consultants, lessors or
lenders, or issued in connection with acquisitions so long as such issuances are not for the purpose of raising capital; (E) issuances of Common Stock, or warrants or options exercisable for Common Stock, in connection with strategic license
agreements so long as such issuances are not for the purpose of raising capital; (F) issuances of Common Stock, or warrants or options exercisable for Common Stock, to acquisition candidates; (G) issuances of Common Stock, or warrants or options
exercisable for Common Stock, for fees paid to an investment banker or advisor; (H) issuances of Common Stock, or warrants or options exercisable for Common Stock, in public secondary offerings; or (I) issuances or deemed issuances of Common Stock,
or warrants or options exercisable for Common Stock, in connection with a repricing or adjustment to the exercise price of any outstanding options or warrants outstanding on the Closing Date, provided, however, that the number of shares of
Common Stock issued or exercisable pursuant to subsections D through I above shall not exceed 5,000,000 in the aggregate. 
  
 (s) Future Financing. After the date hereof and on or before the Closing Date, the Company may conduct a Subsequent Offering based on market
conditions then existing, which Subsequent Offering shall (i) be of a size sufficient to permit the Purchasers to exercise their rights to participate under Section 4(r) to the full extent of the Purchase Price and (ii) be conducted on
commercially reasonable terms and conditions and include customary documentation. 
  
 (t) Con-Ed Transaction. The Company shall immediately notify the Purchasers if, in its reasonable discretion, the transaction contemplated by the Con-Ed Agreement will not be consummated. If on or prior to the
date that is eighteen (18) months from the date of the Con Ed Agreement, the transaction contemplated by the Con-Ed Agreement has not been consummated, this Agreement shall terminate on such date without any further obligation on the part of the
parties hereto, except for the obligations set forth in Section 4(p) above, which shall survive termination pursuant to this Section 4(t). 
  
 (u) Delivery of Securities. At the Closing, the Company shall deliver to such Purchaser duly executed certificates representing the Preferred Stock
and Warrants for the number of Units being purchased by such Purchaser (each in such denominations as such Purchaser shall request), registered in such Purchaser’s name. 
  
 (v) Delivery of Amended Warrants. Contemporaneously with the execution and delivery of this Agreement, the Company
shall deliver to SDS Capital Group SPC, Ltd. the Amended Warrants. 
  
 (w) Legal Opinions. At the Closing, the Company shall deliver to the Purchasers opinions of the Company’s transaction counsel and special communications counsel, dated as of the Closing Date, in the forms attached hereto as
Exhibit G, and Exhibit H, respectively. 
  

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 (x) Secretary’s Certificate. At the Closing, the Company shall provide the Purchasers with a
copy of resolutions, duly adopted by the Board of Directors of the Company, which shall then be in full force and effect, (i) authorizing the execution, delivery and performance by the Company of this Agreement, the Redemption Certificates and the
other Transaction Documents and the consummation by the Company of the transactions contemplated hereby and thereby, and (ii) determining that no “change of control” has occurred or will occur within the meaning of the Company’s
Equity Incentive Plan as a result of the execution and delivery of the Transaction Documents or the consummation of the transactions contemplated thereby, certified as such by the Secretary or Assistant Secretary of the Company, and such other
documents as the Purchasers may reasonably request in connection with the Closing. 
  
 (y) Filing of Certificate of Designation. Prior to Closing, the Company shall have filed the Certificate of Designation with the Secretary of State of the State of Delaware and provided to the Purchasers a copy
thereof certified by the Secretary of State of the State of Delaware. 
  
 (z) Waivers. On or prior to the Closing Date, the Company shall have obtained all consents necessary to waive the rights disclosed in Schedule 3(d) of the Disclosure Schedule other than (i) those set forth in paragraphs 3 and
4 thereof, and (ii) those that have been obtained by the Company prior to the date hereof and which are, and shall remain, in full force and effect through the Closing Date. 
  
 (aa) Con Ed Assets. The Con Ed Agreement shall not be amended, modified or changed without the prior written consent
of the Purchasers, and both the Company and Con Ed will perform, satisfy and comply with, in all material respects (without giving effect to any waiver, amendment or modification thereof by the Company or Con Ed without the prior written consent of
the Purchasers, which such consent may not be unreasonably withheld or delayed), all covenants, agreements and conditions required by the Con Ed Agreement to be performed, satisfied or complied with by the Company and Con Ed at or prior to closing
under the Con Ed Agreement, and the parties shall close thereunder on the business day immediately following the Closing Date. Notwithstanding anything in the foregoing to the contrary, this Section 4(aa) shall not require the prior written
consent of the Purchasers for any waiver of the requirements contained in the following sections of the Con Ed Agreement: (i) Sections 3.2, 6.10, and 6.18 (to the extent such requirements inure solely to the benefit of Con Ed), and (ii) Section 8.2
(other than those regarding the obligations set forth in Section 6.5 thereof). 
  
 (bb) Prohibited Corporate Actions. From the date hereof until the Closing, the Company shall not take any of the following corporate actions (whether by merger, consolidation or otherwise) without first
obtaining the prior written approval of SDS Capital Partners, LLC: 
  
 (i) alter or change the rights, preferences or privileges of any capital stock of the Company so as to affect adversely the Preferred Stock or any series of Redemption Preferred Stock; 
  

 - 21 - 

 (ii) issue any shares of Preferred Stock other than pursuant to this Agreement or another
agreement in the same form, and with exactly the same terms, as this Agreement, including any attachments or exhibits hereto; 
  
 (iii) increase the par value of the Common Stock; 
  
 (iv) issue any debt securities or incur any indebtedness including, but not limited to, capital lease
obligations or increases or changes to currently existing indebtedness that would have any preferences over the Preferred Stock or any series of Redemption Preferred Stock upon liquidation of the Company, unless (y) after taking into account amounts
currently outstanding, the Company would have, in the aggregate, less than $10,000,000 in capital lease obligations and $35,000,000 in other indebtedness (including, but not limited to, obligations, contingent or otherwise, under acceptance, letter
of credit or similar facilities), and (z) such debt securities are issued to, or such indebtedness is incurred with a commercial bank, a savings and loan association, a savings bank, a finance company, insurance company, traditional mezzanine fund
or other financial institution that is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course of its business (each, an “Eligible Lender”); provided, however, that this subsection (z)
shall not apply to any amendment, restatement, modification, renewal, refunding, replacement or refinancing of the Credit Agreement; 
  
 (v) create or issue any capital stock of the Company specifically ranking, by its terms, senior to the Preferred Stock or any series of
Redemption Preferred Stock; 
  
 (vi) enter into
any agreement (other than the Con Ed Agreement), commitment, understanding or other arrangement to take any of the foregoing actions; 
  
 (vii) cause or authorize any subsidiary of the Company to engage in any of the foregoing actions. 
  
 The prohibitions under this Section 4(bb) will govern as if the Preferred Stock or any
Series of Redemption Preferred Stock had been issued and was currently outstanding as of the date hereof. 
  
 (cc) Upon the occurrence of a Redemption Event under the Certificate of Designation, each Purchaser then holding Preferred Stock may elect, as an
alternative to its right to receive the Redemption Amount in accordance with Article VIII.A of the Certificate of Designation, to exchange all of the then outstanding shares of Preferred Stock held by such Purchaser (each such Purchaser is referred
to in this Section 4(cc) as an “Electing Purchaser”) for an equal number of shares of a new series of preferred stock of the Company (shares of preferred stock issued pursuant to this Section 4(cc), regardless of the
respective series of preferred stock, are referred to herein, collectively, as “Redemption Preferred Stock”), plus an additional number of shares of Redemption Preferred Stock (rounded to the nearest share in lieu of any
fractional amounts) equal to an amount determined by dividing all accrued and unpaid dividends or amounts due under the Registration Rights Agreement to such Electing Purchaser by the Face Amount of the Preferred Stock. 
  
 (i) An Electing Purchaser shall indicate its intention to
exercise its rights under this Section 4(cc) in its Redemption Notice to the Company. 
  

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 (ii) The rights, preferences and privileges of the Redemption Preferred Stock (as set
forth in the Redemption Certificate for such series of Redemption Preferred Stock) shall be identical to the rights, preferences and privileges of the Preferred Stock (as set forth in the Certificate of Designation), except that the conversion price
of such series of Redemption Preferred Stock shall be equal to the lesser of (x) the average Closing Sales Price of the Common Stock during the five trading days immediately preceding the date of the first Redemption Notice received by the Company
from an Electing Purchaser after such Redemption Event (the “Initial Redemption Notice”) and (y) the average Closing Sales Price of the Common Stock during the five trading days immediately following the Company’s public
announcement, if any, of such Redemption Event (the “Redemption Announcement Date”). Immediately following its receipt of a Redemption Notice, the Company shall determine whether, in its reasonable judgment, it is obligated under
applicable securities laws to publicly disclose, though the filing of a Form 8-K or otherwise, the occurrence of a Redemption Event. If the Company determines that such obligation exists, it shall so disclose in accordance with such laws. If the
Company determines that such disclosure is not required, the Redemption Announcement Date shall be the date of the Company’s receipt of the Initial Redemption Notice and the conversion price for the new series of Redemption Preferred Stock
shall be the average Closing Sales Price of the Common Stock during the five trading days immediately preceding such date. 
  
 (iii) Within five business days of the Redemption Announcement Date, the Company shall (y) file a Redemption Certificate with the
Secretary of State of the State of Delaware and provide to each Electing Purchaser a copy thereof certified by the Secretary of State of the State of Delaware and (z) deliver to each such Electing Purchaser duly executed certificates representing
the amount of Redemption Preferred Stock due to each such Electing Purchaser pursuant to this Section 4(cc) (each in such denominations as such Electing Purchaser shall request), registered in each such Electing Purchaser’s name.

  
 (iv) If an Electing Purchaser fails to
receive shares of Redemption Preferred Stock in accordance with this Section 4(cc), the Electing Purchaser shall be entitled to the default remedies set forth in Article VIII.C. of the Certificate of Designation as if such Electing Purchaser
had sought to redeem its shares of Preferred Stock for the Redemption Amount and had failed to receive such amount in accordance with Article VIII.C. 
  
 (v) Upon exchange of Preferred Stock for Redemption Preferred Stock in accordance with this Section4(cc), holders of
Redemption Preferred Stock shall remain entitled to the Participation Rights set forth in Section 8 below, the Exchange Rights set forth in Section 9 below and any other rights specifically granted to holders of Redemption Preferred Stock herein.

  
 (vi) For purposes of this Section
4(cc), the term “trading days” and any capitalized terms used in this Section 4(cc) that are not otherwise defined in this Agreement shall have the meanings given to such terms in the Certificate of Designation.

  

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	5.	SECURITIES TRANSFER MATTERS. 

  
 (a) Conversion and Exercise. Upon conversion of the Preferred Stock and Redemption Preferred Stock and upon exercise of the Warrants by any person,
(i) if the DTC Transfer Conditions (as defined below) are satisfied, the Company shall cause its transfer agent to electronically transmit all Conversion Shares, Redemption Shares and Warrant Shares, as applicable, by crediting the account of such
person or its nominee with the Depository Trust Company (“DTC”) through its Deposit Withdrawal Agent Commission system; or (ii) if the DTC Transfer Conditions are not satisfied, the Company shall issue and deliver, or instruct its
transfer agent to issue and deliver, certificates (subject to the legend and other applicable provisions hereof and in the Certificate of Designation, any Redemption Certificate, and the Warrants), registered in the name of such person or its
nominee, physical certificates representing the Conversion Shares, Redemption Shares and Warrant Shares, as applicable. Even if the DTC Transfer Conditions are satisfied, any person effecting a conversion of Preferred Stock or Redemption Preferred
Stock or exercising Warrants may instruct the Company to deliver to such person or its nominee physical certificates representing the Conversion Shares, Redemption Shares and Warrant Shares, as applicable, in lieu of delivering such shares by way of
DTC Transfer. For purposes of this Agreement, “DTC Transfer Conditions” means that (A) the Company’s transfer agent is participating in the DTC Fast Automated Securities Transfer program and (B) the certificates for the
Conversion Shares, Redemption Shares or Warrant Shares required to be delivered do not bear a legend and the person effecting such conversion or exercise is not then required to return such certificate for the placement of a legend thereon.

  
 (b) Transfer or Resale. Each Purchaser understands that
(i) except as provided in the Registration Rights Agreement, the sale or resale of the Securities, Redemption Preferred Stock and Redemption Shares have not been and are not being registered under the Securities Act or any state securities laws, and
the Securities, Redemption Preferred Stock and Redemption Shares may not be transferred unless (A) the transfer is made pursuant to and as set forth in an effective registration statement under the Securities Act covering the Securities, the
Redemption Preferred Stock or the Redemption Shares, as applicable; or (B) such Purchaser shall have delivered to the Company an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable
transactions) to the effect that the Securities, Redemption Preferred Stock or Redemption Shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration; or (C) sold under and in compliance with Rule 144;
or (D) sold or transferred to an affiliate of such Purchaser that agrees to sell or otherwise transfer the Securities, Redemption Preferred Stock or Redemption Shares, as applicable, only in accordance with the provisions of this Section
5(b); and (ii) neither the Company nor any other person is under any obligation to register such Securities, Redemption Preferred Stock and Redemption Shares under the Securities Act or any state securities laws (other than pursuant to the terms
of the Registration Rights Agreement). Notwithstanding the foregoing or anything else contained herein to the contrary, the Securities, Redemption Preferred Stock and Redemption Shares may be pledged as collateral in connection with a bona fide
margin account or other lending arrangement, provided such pledge is consistent with applicable laws, rules and regulations. 
  

 - 24 - 

 (c) Legends. Each Purchaser understands that the Preferred Stock, Redemption Preferred Stock and
the Warrants and, until such time as the sale of the Conversion Shares, Redemption Shares and the Warrant Shares has been registered under the Securities Act (including registration pursuant to Rule 416 thereunder) as contemplated by the
Registration Rights Agreement or until such time as the Conversion Shares, Redemption Shares and the Warrant Shares are otherwise sold by such Purchaser under Rule 144, the certificates for the Conversion Shares, Redemption Shares and the Warrant
Shares may bear a restrictive legend in substantially the following form: 
  
 THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR IN ANY OTHER JURISDICTION. THE
SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED, SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS. 
  
 The Company
shall, immediately prior to a registration statement covering the Securities or Redemption Shares (including, without limitation, the Registration Statement(s) contemplated by the Registration Rights Agreement) being declared effective, deliver to
its transfer agent an opinion letter of counsel, opining that at any time such registration statement is effective, the transfer agent shall issue, in connection with the issuance of Conversion Shares, Redemption Shares or Warrant Shares,
certificates representing such Conversion Shares, Redemption Shares or Warrant Shares without the restrictive legend above, provided such Conversion Shares, Redemption Shares or Warrant Shares are to be sold pursuant to the prospectus contained in
such registration statement. Upon receipt of such opinion, the Company shall cause the transfer agent to confirm, for the benefit of the holders, that no further opinion of counsel is required at the time of transfer in order to issue such shares
without such restrictive legend. 
  
 The legend set forth above
shall be removed and the Company shall issue a certificate without such legend to the holder of any Security, share of Redemption Preferred Stock or Redemption Share, upon which it is stamped, if, unless otherwise required by state securities laws,
(i) the sale of such Security, share of Redemption Preferred Stock or Redemption Share is registered under the Securities Act (including registration pursuant to Rule 416 thereunder); (ii) such holder provides the Company with an opinion of counsel,
in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Security, share of Redemption Preferred Stock or Redemption Share may be made without registration under
the Securities Act; or (iii) such holder provides the Company with reasonable assurances that such Security, share of Redemption Preferred Stock or Redemption Share can be sold under Rule 144. In the event the above legend is removed from any
Security, share of Redemption Preferred Stock or Redemption Share and thereafter the 

  

 - 25 - 

 
effectiveness of a registration statement covering such Security, share of Redemption Preferred Stock or Redemption Share is suspended or the Company
determines that a supplement or amendment thereto is required by applicable securities laws, then upon reasonable advance written notice to such Purchaser the Company may require that the above legend be placed on any such Security, share of
Redemption Preferred Stock or Redemption Share that cannot then be sold pursuant to an effective registration statement or under Rule 144 and such Purchaser shall cooperate in the replacement of such legend. Such legend shall thereafter be removed
when such Security, share of Redemption Preferred Stock or Redemption Share may again be sold pursuant to an effective registration statement or under Rule 144. 
  

(d) Transfer Agent Instruction. Upon compliance by any Purchaser with the provisions of this Section 5 with respect to the transfer of
any Securities, Redemption Preferred Stock or Redemption Shares, the Company shall permit the transfer of such Securities, Redemption Preferred Stock or Redemption Shares, and, in the case of the transfer of Conversion Shares, Redemption Shares or
Warrant Shares, promptly instruct its transfer agent to issue one or more certificates (or effect a DTC Transfer) in such name and in such denominations as specified by such Purchaser. The Company shall not give any instructions to its transfer
agent with respect to the Securities, Redemption Preferred Stock or Redemption Shares other than any permissible or required instructions provided in this Section 5, and the Securities, Redemption Preferred Stock and Redemption Shares shall
otherwise be freely transferable on the books and records of the Company as and to the extent provided in this Agreement. 
  

	6.	CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL. 

  
 The obligation of the Company hereunder to issue and sell the Units to each Purchaser hereunder is subject to the satisfaction, at or before the Closing,
of each of the following conditions as to such Purchaser, provided that such conditions are for the Company’s sole benefit and may be waived by the Company at any time in its sole discretion: 
  
 (a) Execution of Transaction Documents. Each Purchaser shall have
executed such Purchaser’s execution page to the Registration Rights Agreement and delivered the same to the Company. 
  
 (b) Payment of Purchase Price. Each Purchaser shall have delivered the full amount of such Purchaser’s Purchase Price to the Company by wire
transfer in accordance with the Company’s written wiring instructions. 
  
 (c) Representations and Warranties True; Covenants Performed. The representations and warranties of each Purchaser shall be true and correct as of the date hereof and true and correct in all material respects
as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of such date), and such Purchaser shall have performed,
satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by such Purchaser at or prior to Closing or on or prior to the Closing Date.

  

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 (d) No Legal Prohibition. There shall not be in effect any (i) Governmental Regulation, (ii)
temporary restraining order, preliminary or permanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition, or (iii) action or proceeding, that prevents or restricts, or could reasonably be
expected to prevent or restrict, the consummation of any of the transactions contemplated by this Agreement. 
  

	7.	CONDITIONS TO EACH PURCHASER’S OBLIGATION TO PURCHASE. 

  
 The obligation of each Purchaser hereunder to purchase the Units for which it is subscribing from the Company hereunder is subject to the satisfaction, at
or before the Closing, of each of the following conditions, provided that such conditions are for each Purchaser’s individual and sole benefit and may be waived by any Purchaser as to such Purchaser at any time in such Purchaser’s sole
discretion: 
  
 (a) Execution of Transaction Documents. The
Company shall have executed the Company’s execution pages to the Warrants, the Registration Rights Agreement and the Amended Warrants and delivered executed originals of the same to each Purchaser. 
  
 (b) Representations and Warranties True; Covenants Performed. The
representations and warranties of the Company shall be true and correct as of the date when made and as of the Closing Date as though made at that time (except for (i) representations and warranties that speak as of a specific date, which
representations and warranties shall be true and correct as of such date and (ii) any breaches of any representation or warranty as of the Closing Date as a result of events or conditions that occurred during the period between the date hereof and
the Closing Date which, individually or in the aggregate, have not had any Material Adverse Effect (provided, however, that any Material Adverse Effect, materiality or similar qualifier contained in any representation or warranty or portion thereof
shall be disregarded for purposes of determining whether such representation or warranty has been breached for purposes this clause (ii)) and the Company shall have performed, satisfied and complied with the covenants, agreements and conditions
required by this Agreement to be performed, satisfied or complied with by the Company at or prior to Closing or on or prior to the Closing Date. 
  
 (c) Officer Certificate. Such Purchaser shall have received a certificate, executed by the Chief Executive Officer of the Company after reasonable
investigation, dated as of the Closing Date: (i) certifying as to Section 7(b) above, (ii) setting forth any breaches of any representation or warranty as of the Closing Date as a result of events or conditions that occurred during the period
between the date hereof and the Closing Date, and (iii) providing such other matters as may reasonably be requested by such Purchaser. 
  
 (d) No Legal Prohibition. There shall not be in effect any (i) Governmental Regulation, (ii) temporary restraining order, preliminary or permanent
injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition, or (iii) action or proceeding, that prevents or restricts, or could reasonably be expected to prevent or restrict, the consummation of any
of the transactions contemplated by this Agreement. 
  

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 (e) Consummation of Con Ed Transaction. Both Con Ed and the Company shall have the good faith
intention to close under the Con Ed Agreement on the business day immediately following the Closing Date. For the sake of clarity, this means that, consistent with Section4(aa), (i) the Company shall be willing and able to purchase,
and Con Ed shall be willing and able to sell, the Con Ed Holdings Stock and, (ii) both Con Ed and the Company shall be willing and able to consummate all other transactions contemplated by the Con Ed Agreement to be consummated as of or prior to the
closing thereunder. The Company shall have received a certificate executed by the Chief Executive Officer of the Company after reasonable investigation, dated as of the Closing Date, to the foregoing effect. 
  

	8.	PARTICIPATION RIGHT. 

  
 (a) Subject to the terms and conditions specified in this Section 8, until the first anniversary of the Closing Date, the holders of shares of
Preferred Stock or Redemption Preferred Stock shall have a right to participate with respect to the issuance or possible issuance of any Additional Securities on the same terms and conditions as offered by the Company to the other purchasers of such
Additional Securities. 
  
 (b) Each time the Company proposes to
offer any Additional Securities, the Company shall make an offering of such Additional Securities to each holder of shares of Preferred Stock or Redemption Preferred Stock in accordance with the following provisions: 
  
 (i) The Company shall deliver a notice (the
“Issuance Notice”) to the Purchasers at least 20 days prior to any sale of Additional Securities, and such Issuance Notice shall state (a) its bona fide intention to offer such Additional Securities, (b) the number of such
Additional Securities to be offered, (c) the price (the “Offering Price”) and terms, if any, upon which it proposes to offer such Additional Securities, and (d) the anticipated closing date of the sale of such Additional Securities.

  
 (ii) By written notification received by the
Company, within 15 business days after giving of the Issuance Notice, any holder of shares of Preferred Stock or Redemption Preferred Stock may elect to purchase or obtain, at the Offering Price and on the terms specified in the Issuance Notice
(provided that if the Offering Price is to be paid in whole or in part in consideration other than cash, the holders of Preferred Stock or Redemption Preferred Stock exercising their rights hereunder shall have the option to pay such consideration
in cash equal to the fair market value of such non-cash consideration (valued in accordance with the method set forth in Article XI.E(ii) of the Certificate of Designations or such comparable provision of the Redemption Certificates, as applicable),
up to that number of such Additional Securities equal to 50% of the Purchase Price set forth in such holder’s signature page to this Agreement divided by the Offering Price. 
  
 (iii) If the total number of securities elected to be purchased by the holders of Preferred Stock or
Redemption Preferred Stock pursuant to this Section 8 is greater than the number of Additional Securities offered by the Company, the Company shall promptly, in writing, inform each holder electing to participate hereunder (a
“Participating Holder”), and each Participating Holder shall be entitled to obtain that portion of the Additional Securities 

  

 - 28 - 

 
equal to the proportion that the number of shares of Preferred Stock or Redemption Preferred Stock held by such Participating Holder bears to the total
number of shares of Preferred Stock and Redemption Preferred Stock held by all Participating Holders. 
  
 (iv) The Company shall promptly, in writing, inform each holder of shares of Preferred Stock or Redemption Preferred Stock which elects to
purchase all of the Additional Shares available to it under this Section 8 (“Fully-Exercising Holder”) of any other holder’s failure to do likewise. During the five-day period commencing after such information is given,
each Fully-Exercising Holder shall be entitled to obtain that portion of the Additional Securities for which the holders of shares of Preferred Stock or Redemption Preferred Stock were entitled to subscribe but which were not subscribed for by such
holders which is equal to the proportion that the number of shares of Preferred Stock or Redemption Preferred Stock held by such Fully-Exercising Holder bears to the total number of shares of Preferred Stock and Redemption Preferred Stock held by
all Fully-Exercising Holders who wish to purchase any of the unsubscribed shares. 
  
 (v) If all Additional Securities which the holders of shares of Preferred Stock or Redemption Preferred Stock are entitled to obtain
pursuant to this Section 8 are not elected to be obtained as provided in subparagraph (iv), the Company may, during the 75-day period following the expiration of the period provided in such subparagraph, offer the remaining unsubscribed
portion of such Additional Securities to any person or persons at a price not less than, and upon terms no more favorable to the offeree than, those specified in the Issuance Notice. If the Company does not consummate the sale of such Additional
Securities within such period, the right provided hereunder shall be deemed to be revived and such Additional Securities shall not be offered or sold unless first reoffered to the holders of shares of Preferred Stock and Redemption Preferred Stock
in accordance herewith. 
  
 (c) In addition to the rights set
forth in Section 10(g), each Purchaser may, with the written consent of the Company (which such consent may not be unreasonably withheld or delayed), assign its rights in this Section 8 separately from the other rights under this
Agreement. 
  

	9.	EXCHANGE RIGHT. 

  
 (a) Subject to the terms and conditions specified in this Section 9, the holders of shares of Preferred Stock or Redemption Preferred Stock shall
have a right to exchange shares of Preferred Stock or Redemption Preferred Stock for Additional Securities on the same terms and conditions as offered by the Company to the other purchasers of such Additional Securities. 
  
 (b) Each time the Company proposes to offer any Additional Securities, the
Company shall make an offering of such Additional Securities to each holder of shares of Preferred Stock or Redemption Preferred Stock in accordance with the following provisions: 
  
 (i) The Company shall deliver an Issuance Notice to the Purchasers as provided in Section 8(b)(i)
above. 
  
 (ii) By written notification received
by the Company, within 15 business days after giving of the Issuance Notice, any holder of shares of Preferred Stock or Redemption 

  

 - 29 - 

 
Preferred Stock may elect to exchange any of its then owned Preferred Stock or Redemption Preferred Stock for Additional Securities, at the Offering Price
and on the terms specified in the Issuance Notice (provided that if the Offering Price is to be paid in whole or in part in consideration other than cash, the holders of Preferred Stock or Redemption Preferred Stock exercising their rights hereunder
shall have the option to pay such consideration in shares of Preferred Stock or Redemption Preferred Stock (valued in accordance with the method set forth in Article XI.E(ii) of the Certificate of Designation), as if each share of Preferred Stock or
Redemption Preferred Stock was cash equal to the Face Value plus any accrued and unpaid dividends or amounts due under the Registration Rights Agreement. 
  
 (iii) If the number of securities elected to be purchased by the holders of Preferred Stock and Redemption Preferred Stock pursuant to
this Section 9 is greater than the number of Additional Securities offered by the Company, the Company shall promptly, in writing, inform each holder electing to participate hereunder (an “Exchanging Holder”), and each
Exchanging Holder shall be entitled to obtain that portion of the Additional Securities equal to the proportion that the number of shares of Preferred Stock or Redemption Preferred Stock held by such Exchanging Holder bears to the total number of
shares of Preferred Stock and Redemption Preferred Stock held by all Exchanging Holders. 
  
 (iv) The Company shall promptly, in writing, inform each holder of shares of Preferred Stock or Redemption Preferred Stock which elects to
purchase all of the Additional Shares available to it under this Section 9 (“Fully-Exchanging Holder”) of any other holder’s failure to do likewise. During the five-day period commencing after such information is given,
each Fully-Exchanging Holder shall be entitled to obtain that portion of the Additional Securities for which the holders of shares of Preferred Stock and Redemption Preferred Stock were entitled to subscribe but which were not subscribed for by such
holders which is equal to the proportion that the number of shares of Preferred Stock or Redemption Preferred Stock held by such Fully-Exchanging Holder bears to the total number of shares of Preferred Stock and Redemption Preferred Stock held by
all Fully-Fully Exchanging Holders who wish to purchase any of the unsubscribed shares. 
  
 (v) If all Additional Securities which the holders of shares of Preferred Stock or Redemption Preferred Stock are entitled to obtain
pursuant to this Section 9 are not elected to be obtained as provided in subparagraph (iv), the Company may, during the 75-day period following the expiration of the period provided in such subparagraph, offer the remaining unsubscribed
portion of such Additional Securities to any person or persons at a price not less than, and upon terms no more favorable to the offeree than, those specified in the Issuance Notice. If the Company does not consummate the sale of such Additional
Securities within such period, the right provided hereunder shall be deemed to be revived and such Additional Securities shall not be offered or sold unless first reoffered to the holders of shares of Preferred Stock and Redemption Preferred Stock
in accordance herewith. 
  
 (c) All rights under this Section
9 shall immediately terminate upon the earlier to occur of (i) the first date following the Closing Date on which the Company completes an offering of Common Stock with a purchase price of at least $1.00 per share and gross proceeds of at least
$20,000,000, or (ii) the first date that is at least 12 months after the Closing Date and 

  

 - 30 - 

 
immediately prior to which the Closing Sales Price (as defined in the Certificate of Designation) of the Common Stock has been at least $1.35 for 30
consecutive trading days. 
  
 (d) Notwithstanding anything set
forth in this Certificate of Designation or any Redemption Certificate to the contrary, if the number of securities elected to be purchased by the holders of Preferred Stock and Redemption Preferred Stock pursuant to Section 8 and this
Section 9 is greater than the number of Additional Securities offered by the Company, the rights of the Exchanging Holders provided under this Section 9 shall take precedent and such holders shall have the right to fully exchange all
of their shares of Preferred Stock or Redemption Preferred Stock before any Participating Holder shall have any rights under Section 8. 
  
 (e) In addition to the rights set forth in Section 10(g), each Purchaser may, with the written consent of the Company (which such consent may not
be unreasonably withheld or delayed), assign its rights in this Section 9 separately from the other rights under this Agreement. 
  

	10.	GOVERNING LAW; MISCELLANEOUS. 

  
 (a) Governing Law; Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware applicable
to contracts made and to be performed in the State of Delaware. The Company and each Purchaser irrevocably consent to the jurisdiction of the United States federal courts and the state courts located in the County of New Castle, State of Delaware,
in any suit or proceeding based on or arising under this Agreement and irrevocably agree that all claims in respect of such suit or proceeding may be determined in such courts. The Company irrevocably waives the defense of an inconvenient forum to
the maintenance of such suit or proceeding in such forum. The Company further agrees that service of process upon the Company mailed by first class mail shall be deemed in every respect effective service of process upon the Company in any such suit
or proceeding. Nothing herein shall affect the right of any Purchaser to serve process in any other manner permitted by law. The Company agrees that a final non-appealable judgment in any such suit or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on such judgment or in any other lawful manner. 
  
 (b) Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each
party and delivered to the other parties. This Agreement, once executed by a party, may be delivered to the other parties hereto by facsimile transmission of a copy of this Agreement bearing the signature of the party so delivering this Agreement.
In the event any signature is delivered by facsimile transmission, the party using such means of delivery shall cause the manually executed execution page(s) hereof to be physically delivered to the other party within five days of the execution
hereof, provided that the failure to so deliver any manually executed execution page shall not affect the validity or enforceability of this Agreement. 
  
 (c) Construction. Whenever the context requires, the gender of any word used in this Agreement includes the masculine, feminine or neuter, and the
number of any word includes the singular or plural. Unless the context otherwise requires, all references to articles and sections 

  

 - 31 - 

 
refer to articles and sections of this Agreement, and all references to schedules are to schedules attached hereto, each of which is made a part hereof for
all purposes. The descriptive headings of the several articles and sections of this Agreement are inserted for purposes of reference only, and shall not affect the meaning or construction of any of the provisions hereof. 
  
 (d) Severability. If any provision of this Agreement shall be invalid
or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement or the validity or enforceability of this Agreement in any other jurisdiction. 

 
 (e) Entire Agreement; Amendments. This Agreement and the other
Transaction Documents (including any schedules and exhibits hereto and thereto) contain the entire understanding of the Purchasers, the Company, their affiliates and persons acting on their behalf with respect to the matters covered herein and
therein and, except as specifically set forth herein or therein, neither the Company nor the Purchasers make any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived other than
by an instrument in writing signed by the party to be charged with enforcement, and no provision of this Agreement may be amended other than by an instrument in writing signed by the Company and each Purchaser. 
  
 (f) Notices. Any notices required or permitted to be given under the
terms of this Agreement shall be in writing and sent by certified or registered mail (return receipt requested) or delivered personally, by nationally recognized overnight carrier or by confirmed facsimile transmission, and shall be effective five
days after being placed in the mail, if mailed, or upon receipt or refusal of receipt, if delivered personally or by nationally recognized overnight carrier or confirmed facsimile transmission, in each case addressed to a party as provided herein.
The initial addresses for such communications shall be as follows, and each party shall provide notice to the other parties of any change in such party’s address: 
  
 (i) If to the Company: 
  
 FiberNet Telecom Group, Inc. 
 570 Lexington Avenue 
 New York, New York 10022 
 Attention:   President 
 Telephone: (212) 405-6200 
 Facsimile:  (212) 421-8860 
  
 with a copy simultaneously transmitted by like means (which transmittal shall not constitute notice hereunder) to:

  
 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

 Chrysler Center 
 666 Third
Avenue 
 New York, New York 10017 
 Telephone: (212) 925-3000 
 Facsimile:  (212) 983-3115 
 Attention:  Todd E. Mason, Esq. 
  

 - 32 - 

 (ii) If to any Purchaser, to the address set forth under such Purchaser’s name on
the Execution Page hereto executed by such Purchaser. 
  
 (g)
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. Except as provided herein, the Company shall not assign this Agreement or any rights or obligations
hereunder. With the prior written consent of the Company, which such consent may not be unreasonably withheld or delayed, any Purchaser may assign or transfer the Securities, Redemption Preferred Stock or Redemption Shares pursuant to the terms of
this Agreement and of such Securities, Redemption Preferred Stock or Redemption Shares or assign such Purchaser’s rights hereunder to any other person or entity; provided, that if any such assignee or transferee materially breaches any term of
this Agreement (including, for purposes of clarity, if the assignee or transferee fails to purchase the Units or any Additional Securities pursuant to Section 4(r) as and when required hereunder) then any such assignment or transfer will
expressly be deemed null and void ab initio and the Purchaser shall be obligated to perform all of its obligations under this Agreement. Each Purchaser shall also be obligated to perform all of the obligations under this Agreement, as though
no such assignment or transfer to an assignee or transferee had been made, if the assignee or transferee fails to purchase the Units or any Additional Securities pursuant to Section 4(r) as and when required hereunder, despite any such
failure being excused or otherwise affected or any enforcement action with respect to such failure being stayed or otherwise affected because such assignee or transferee is the subject of a bankruptcy, insolvency or similar action or proceeding.

  
 (h) Third Party Beneficiaries. This Agreement is
intended for the benefit of the parties hereto and their respective permitted successors and assigns and, except as expressly provided herein, is not for the benefit of, nor may any provision hereof be enforced by, any other person, including, but
not limited to, Con Ed; provided, however, that Section 4(p) may be enforced by any Purchaser’s affiliates and its or their advisors to the extent the same is entitled to reimbursement of Expenses pursuant thereto.

  
 (i) Survival. The representations and warranties of the
Company and the agreements and covenants set forth in Sections 3, 4, 5, 8, 9, and 10 shall, subject to Section 10(o) below, survive for a period of two years following the Closing notwithstanding any due diligence investigation
conducted by or on behalf of any Purchaser. Moreover, none of the representations and warranties made by the Company herein shall act as a waiver of any rights or remedies any Purchaser may have under applicable U.S. federal or state securities
laws. 
  
 (j) Publicity. The Company and each Purchaser
shall have the right to approve before issuance any press releases, SEC or, to the extent applicable, NASD filings, or any other public statements by the Company or any Purchaser (including any joint statements made by the Company or any Purchaser
with any third party) with respect to the transactions contemplated hereby; provided, however, that (i) the Company shall be entitled, without the prior approval of the Purchasers, to make any press release or SEC or, to the extent
applicable, NASD filings with 

  

 - 33 - 

 
respect to such transactions as is required by applicable law and regulations (although the Purchasers shall be consulted by the Company in connection with
any such press release and filing prior to its release and shall be provided with a copy thereof and must provide specific consent to the use of their name in connection therewith), and (ii) nothing in this Section 10(j) shall prohibit any
announcement of the Con Ed Agreement or the transactions contemplated thereby that does not, directly or indirectly, reference any Purchaser, this Agreement or any other Transactional Document, or any of the transactions contemplated hereby or
thereby. 
  
 (k) Further Assurances. Each party shall do
and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the
intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 
  
 (l) Indemnification. In consideration of each Purchaser’s execution and delivery of this Agreement and the other Transaction Documents and
purchase of the Securities hereunder, and in addition to all of the Company’s other obligations under this Agreement and the other Transaction Documents, from and after the Closing, subject to Section 10(o) below, the Company shall
defend, protect, indemnify and hold harmless each Purchaser and each other holder of the Securities and all of their stockholders, partners, members, officers, directors, employees and direct or indirect investors and any of the foregoing
persons’ agents or other representatives (including, without limitation, those retained in connection with the transactions contemplated by this Agreement, collectively, the “Indemnitees”) from and against any and all actions,
causes of action, suits, claims, losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith (irrespective of whether any such Indemnitee is a party to the action for which indemnification hereunder is sought), and
including reasonable attorneys’ fees and disbursements (the “Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of, or relating to (i) any misrepresentation or breach of any representation or
warranty made by the Company in this Agreement, any other Transaction Document or any other certificate, instrument or document contemplated hereby or thereby, (ii) any breach of any covenant, agreement or obligation of the Company contained in this
Agreement, any other Transaction Document or any other certificate, instrument or document contemplated hereby or thereby or (iii) any cause of action, suit, claim, order, proceeding or process brought or made against such Indemnitee by a third
party (including for these purposes a derivative action brought on behalf of the Company) and arising out of or resulting from (A) the execution, delivery, performance or enforcement of this Agreement, any other Transaction Document or any other
certificate, instrument or document contemplated hereby or thereby, (B) any transaction financed or to be financed in whole or in part, directly or indirectly, with the proceeds of the issuance and sale of the Securities, (C) any disclosure made by
such Purchaser pursuant to Section 4(b), or (D) the status of such Purchaser or holder of the Securities as an investor in the Company. To the extent that the foregoing undertaking by the Company may be unenforceable for any reason, the
Company shall, subject to Section 10(o) below, make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law. Except as otherwise set forth herein, the mechanics
and procedures with respect to the rights and obligations under this Section 10(l) shall be the same as those set forth in Section 7(c) of the Registration Rights Agreement. 
  

 - 34 - 

 (m) Payment Set Aside. To the extent that the Company makes a payment or payments to any Purchaser
hereunder or pursuant to any of the other Transaction Documents or any Purchaser enforces or exercises its rights hereunder or thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other person under any law
(including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and
continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred. 
  
 (n) Joint Participation in Drafting. Each party to this Agreement has participated in the negotiation and drafting of this Agreement and the other
Transaction Documents. As such, the language used herein and therein shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction will be applied against any party to this
Agreement. 
  
 (o) Remedies/Restriction on Payments.

  
 (i) Subject to the this Section 10(o),
no provision of this Agreement or any other Transaction Document providing for any remedy to a Purchaser shall limit any other remedy which would otherwise be available to such Purchaser at law, in equity or otherwise. Subject to the this Section
10(o), nothing in this Agreement or any other Transaction Document shall limit any rights any Purchaser may have under any applicable federal or state securities laws with respect to the investment contemplated hereby. The Company acknowledges
that a breach by it of its obligations hereunder will cause irreparable harm to the Purchasers by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of
its obligations hereunder (including, but not limited to, its obligations pursuant to Section 5) will be inadequate and agrees, in the event of a breach or threatened breach by the Company of the provisions of this Agreement (including, but
not limited to, its obligations pursuant to Section 5), that each Purchaser shall be entitled, in addition to all other available remedies, to an injunction restraining any breach and requiring immediate issuance and transfer of the
Securities, without the necessity of showing economic loss and without any bond or other security being required. 
  
 (ii) For purposes of this clause (ii), capitalized terms used herein that are not otherwise defined in this Agreement shall have the
meanings given to such terms in the Credit Facilities (as defined below). 
  
 (A) Until such time as the Commitments, Obligations or Letters of Credit that exist as of the Closing Date under the Credit Facilities, or that exist pursuant to any debt securities or indebtedness permitted by
Section 4(bb)(iv) hereof have been repaid or otherwise fully terminated to the satisfaction of the Lenders (the “Repayment Date”), the Company shall not make any payments in cash or other assets to any Purchaser pursuant to
this Agreement or otherwise, whether as dividends, in respect of any right of redemption, as damages 

  

 - 35 - 

 
or otherwise. Until the Repayment Date, any such amounts otherwise payable in cash or other assets shall be paid in additional shares of Preferred Stock or,
if a Purchaser has exercised its rights pursuant to Section 4(cc) above, Redemption Preferred Stock, with an aggregate liquidation preference equal to such amounts, and any such amounts otherwise payable in cash or otherwise assets which are
paid in additional shares of Preferred Stock or Redemption Preferred Stock shall be deemed to be fully paid and satisfied and shall no longer be due or payable. 
  
 (B) If any Purchaser receives any payments in cash or other assets in violation of this Section
10(o), such Purchaser shall turn over all such amounts received to the representative of the Lenders under the Credit Facilities. 
  
 (C) The Lenders under the Credit Facilities shall be third party beneficiaries of this Section 10(o) and the Lenders (either
individually or through one or more representatives) shall be entitled to enforce the provisions hereof against the Company and the Purchasers as if they were a party hereto. 
  
 (D) For purposes of this Section 10(o), in addition to the other terms defined herein, the following
terms shall have the following meanings: 
  
 i.
“Credit Agreement” means the Amended and Restated Credit Agreement dated as of February 9, 2001 among FiberNet Operations, Inc. Devnet L.L.C., the institutions party thereto from time to time as lenders, Deutsche Bank AG New York
Branch, as administrative agent, Wachovia Investors, Inc., as documentation agent, and TD Securities (USA) Inc., as syndication agent, as the same may have been amended prior to the date hereof or as may be, subject to Section 4(bb)(iv),
amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time thereafter. 
  
 ii. “Credit Facilities” means, collectively, (i) the Credit Agreement, and (ii) subject to Section 4(bb)(iv), any
of the following entered into by the Company after the date hereof: (1) debt facilities or commercial paper facilities, in each case with banks or other institutional lenders or financial institutions providing for revolving credit loans, term
loans, credit-linked deposits (or similar deposits), (2) receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against receivables), or (3) letters of
credit, in each case, as the same may be, subject to Section 4(bb)(iv), amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time. 
  
 (p) Knowledge. As used in this Agreement, the term
“knowledge” of any person or entity shall mean and include (i) actual knowledge and (ii) that knowledge which a reasonably prudent business person could have obtained in the management of his or her business affairs after making due
inquiry and exercising due diligence which a prudent business person should have made or exercised, as applicable, with respect thereto. 
  
 (q) Exculpation Among Purchasers; No “Group”. Each Purchaser acknowledges that it has independently evaluated the merits of the
transactions contemplated by this Agreement and the other Transaction Documents, that it has independently determined to enter into the 

  

 - 36 - 

 
transactions contemplated hereby and thereby, that it is not relying on any advice from or evaluation by any other Purchaser, and that it is not acting in
concert with any other Purchaser in making its purchase of securities hereunder or in monitoring its investment in the Company. The Purchasers and, to its knowledge, the Company agree that the Purchasers have not taken any actions that would deem
such Purchasers to be members of a “group” for purposes of Section 13(d) of the Exchange Act, and the Purchasers have not agreed to act together for the purpose of acquiring, holding, voting or disposing of equity securities of the
Company. Each Purchaser further acknowledges that SDS Capital Partners, LLC has retained Drinker Biddle & Reath LLP (“DB&R”) to act as its counsel in connection with the transactions contemplated by this Agreement and the
other Transaction Documents and that DB&R has not acted as counsel for any of the other Purchasers in connection therewith and none of the other Purchasers have the status of a client of DB&R for conflict of interest or other purposes as a
result thereof. 
  
 [REMAINDER OF PAGE LEFT BLANK INTENTIONALLY]

  

 - 37 - 

 IN WITNESS WHEREOF, the undersigned Purchaser and the Company have caused this Agreement to be duly
executed as of the date first above written. 
  

			
	FIBERNET TELECOM GROUP, INC.
		
	By:	 	 
	 Name:
	 	 
	 Title:
	 	 
	
	PURCHASER:
	
	SDS CAPITAL PARTNERS, LLC
		
	By:	 	 
	 Name:
	 	 
	 Title:
	 	 

  

					
			
	 RESIDENCE:
	 	 	 	 
			
	 ADDRESS:
	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 Telephone:
	 	 
	 	 	 Facsimile:
	 	 
	 	 	 Attention:
	 	 

  

			
	AGGREGATE SUBSCRIPTION AMOUNT:
		
	Number of Units:	 	 
	 Purchase Price ($             per Unit):
                            

  
 [SIGNATURE PAGE TO
SECURITIES PURCHASE AGREEMENT]

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