Document:

Exhibit 10.3

 

INDIGO SECURITIES, LLC

780 THIRD AVENUE, 23RD
FLOOR

NEW YORK, NEW
YORK  10017

Telephone (212)
972-0900

Facsimile (212)
298-9933

 

	
   

  	
  February 15, 2005

  
	
   

  
	
  Vistula
  Communications Services, Inc.

  
	
  40 Portman Square, 4th Floor

  
	
  London W1H GLT

  
	
  United Kingdom

  

 

Placement Agent Agreement

 

Gentlemen:

 

The
undersigned, Vistula Communications Services, Inc. (the “Company”),
hereby agrees with IndiGo Securities, LLC (“Placement Agent”) as
follows:

 

1.  Offering

 

A.            The
Company hereby engages the Placement Agent to act as its agent in connection
with:

 

(i) the sale by the Company (the “Private Placement”
or the “Offering”) of up to $10,000,000 (the “Maximum Amount”),
face amount of the Company’s 8% Senior Convertible Debentures (the “Debentures”)
and warrants to acquire Company common stock (the “Warrants” and,
together with the Debentures, the “Securities”).  The Securities shall be offered on terms as
outlined in the Securities Purchase Agreement substantially identical to the
form attached hereto as Exhibit A (the “Securities Purchase Agreement”).  The Private Placement shall be conducted as a
private placement to be made pursuant to the exemption afforded by Section 4(2)
of the Securities Act of 1933, as amended (the “Act”) and Rule 506 of
Regulation D promulgated thereunder, as well as applicable state laws.

 

(ii) Upon the consummation of the Private Placement, the
Placement Agent will provide the Company with ongoing financial and strategic
advisory services (“Consulting Services”) including but not limited to
the following: (a) assisting in refining the Company’s business strategy, with
an eye toward investor perception, (b) assisting in and reviewing shareholder
communication strategy and execution, (c) identifying institutional
public-market investors and arrange meetings and conference calls, (d)
providing introductions to and setting up meetings between the Company’s
executives and industry analysts; and (e) assisting the Company in recruiting
potential executives, board members, customers and strategic partners by
leveraging the Placement Agent’s extensive network of personal and business
relationships.  In addition, while the
Placement Agent will not act in the role of traditional Investor
Relations/Public Relations firm for purposes of preparing and distributing
press releases, investor packages, etc., the Placement Agent will provide the
Company with recommendations of Investor Relations/Public Relations firms.

 

 

B.            The Private Placement will be
coordinated with, and conditioned upon the completion of satisfactory due
diligence by the Purchasers and the Company’s execution and delivery of this
Placement Agent Agreement and the Securities Purchase Agreement, the Debentures,
the Warrants, Placement Agent Warrant, Registration Rights Agreement and the
Escrow Agreement (the “Escrow Agreement”) substantially in the forms
attached hereto as Exhibits A, B, C, D, E and F respectively.

 

C.            The closings under the Securities Purchase Agreement will
be held at the Company’s offices, or the offices of counsel to the Company, or
as otherwise agreed by the Company and the purchasers under the Securities
Purchase Agreement (the “Purchasers”), where the proceeds of such
accepted offers will be delivered to the Company by the Escrow Agent (as
defined in the Escrow Agreement)  against
delivery by the Company of Securities to the Escrow Agent for further delivery
to the Purchasers, and payment to the Placement Agent of its expenses and other
compensation due hereunder including, without limitation, up to $30,000 for legal
fees of the Placement Agent’s counsel and reasonable disbursements of Placement
Agent’s counsel.  The initial closing for
the Private Placement (the “Initial Closing”) is anticipated to take
place on February 18, 2005.  After the Initial
Closing,  an additional closing may take
place within 30 days after the Initial Closing as provided in the Securities
Purchase Agreement.

 

D.            The Private Placement shall
terminate on the earlier of:

 

(i)            the date on which the Maximum Amount
of Securities has been sold; or

 

(ii)           the date which is thirty days after
the Initial Closing (the “Offering Termination Date”).

 

2.  Subscriptions and Disbursements of Proceeds

 

A.            From the date of this Agreement until
the Offering Termination Date (the “Offering Period”) , the Securities
will be offered by the Company, with the assistance of the Placement Agent, by
means of subscription documents which shall include the Company’s Form 10-SB as
most recently amended (the “Subscription Documents”) which shall be
delivered to each potential investor.    The Securities will be sold only to
Accredited Investors as that term is defined in Regulation D of the Act.

 

B.            The Placement Agent shall only be
obligated to assist the Company with the sale of Securities on a “best efforts”
basis as described above.

 

C.            Each of the Company and the
Placement Agent reserves the right to reject any subscriber in its respective
sole discretion, provided that the Company shall not reject any subscription
tendered by an Accredited Investor unless such investor fails to satisfy legal
requirements to which the Company is subject and is unable to satisfy such
requirement without undue hardship or disruption to the conduct of the Private
Placement.

 

D.            All funds of subscribers shall be
placed with the Escrow Agent in a non-interest bearing bank escrow account
subject to the terms of the Escrow Agreement, to comply with Rule 15c2-4 of the
Securities Exchange Act of 1934 (the “Exchange Act”).

 

3.  Further Agreements of the Company

 

The
Company agrees, at its expense and without any expense to the Placement Agent,
as follows:

 

 

A.            As soon as the Company is either
informed or becomes aware thereof, to advise the Placement Agent of any
material adverse change in the Company’s financial condition, business
prospects, or of any development materially affecting the Company or rendering
untrue or misleading any material statement in the Subscription Documents.

 

B.            To provide the Placement Agent with
a copy of all documents, reports and information as may be reasonably requested
by the Placement Agent in connection with the Subscription Documents, or the
Company’s business plans or prospects.

 

C.            To provide the Placement Agent with
a copy of a list of stockholders, as requested.

 

D.            To provide the Placement Agent with
as many copies of the Subscription Documents, and amendments thereof, as the
Placement Agent may reasonably request.

 

E.             In connection with the consummation
of the Offering, the Company agrees to execute the Securities Purchase
Agreement, Debenture, Warrant, Placement Agent Warrant, Registration Rights
Agreement and the Escrow Agreement substantially identical to the forms
attached hereto as Exhibits A, B, C, D, E and F, respectively.

 

4.  Commissions, Agreements and Expenses

 

A.            Cash Fee.

 

(i)                                                                                     At
each closing, the Placement Agent will receive a cash fee (the “Cash Fee”)
equal to 10.0% percent of the aggregate purchase price of the Securities sold
at such closing.

 

(ii)                                                                                  At the final closing of Securities, the
Company shall deliver to the Placement Agent or its designees a warrant
agreement (the “Agent Warrants”) exercisable for a number of common
shares of the Company equal to the Cash Fee attributable to the sale of
Securities divided by $1.00 in the form of Exhibit D.

 

(iii)                                                                               The Placement Agent shall receive a cash fee
of $20,000 per month (“Consulting Fee”) for Consulting Services for a
period of 12 months beginning on the first closing of the Offering, provided
that, the Company shall be entitled to review the Placement Agent’s performance
of Consulting Services after 6 months.  The
Company shall be entitled to terminate this Consulting Services agreement upon
written notice to the Placement Agent following the expiration of this
six-month period. The Placement Agent shall have a monthly option to accept 10,000
 common stock warrants exercisable at $1.00
in lieu of 1⁄2 of the cash Consulting Fee payable for that month.

 

B.            At the final closing, the Company
shall deliver to the Placement Agent or its designees Agent Warrants
exercisable for a number of common shares of the Company issuable under Section
4.A.(i)(b) above.  The Placement Agent
shall be entitled to the same registration rights with respect to the shares
underlying the Agent Warrants as the registration rights received by investors
in the Offering.

 

 

C.            The Placement Agent and its
affiliates  shall have the right to
purchase Securities in the Private Placement net of cash commissions payable to
the Placement Agent hereunder and the Placement Agent shall receive its pro
rata share of the Agent Warrants in connection with any such investment;
provided that (i) the Company’s issuance of such Agent Warrants will be the
same as and have the same economic effect to the Company as if the such Securities
were purchased by a third party investor, and (ii) the purchase of such
Securities by the Placement Agent will not cause the Company to exceed its
Maximum Amount.

 

D.            The Company will furnish at its
expense such quantities of the Subscription Documents and instruments as the
Placement Agent may reasonably request. 
In addition, the Company will pay for all Blue Sky filing fees, counsel
fees and disbursements with respect to Blue Sky qualification.  All required Blue Sky filings and federal
securities law filings shall be prepared by counsel to the Company.

 

E.             If, at any time up to and including the final closing of
a sale of Securities, or the termination of this Agreement by the Company
(whichever is earlier), or within the 12 month period after the termination of the
Offering Period, the Company or any of its affiliates conducts a private
placement of securities to any investor whom the Placement Agent introduced to
the Company during the Offering Period, the Company will pay the Placement
Agent the Section 4.A. Cash Fee and Agent Warrant with respect to such sale, calculated
in accordance with the preceding paragraphs 4.A. and B.

 

F.             A 50% discount to the Cash Fee and the Agent Warrants
shall apply to any investor in the Offering introduced to the Placement Agent or
the Company by a member of the Company’s management team (including without
limitation, Bushido Capital).

 

5.  Representations, Warranties and Covenants of
the Placement Agent

 

A.            This Agreement has been duly and
validly authorized by the Placement Agent and is a valid and binding agreement
of the Placement Agent, enforceable in accordance with its terms, except (i) as
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
other laws of general application affecting enforcement of creditors’ rights
generally, (ii) the exercise of judicial or administrative discretion in
accordance with general equitable principles or public policy, (iii) as limited
by laws relating to the availability of specific performance, injunctive relief
or other equitable remedies and (iv) insofar as indemnification and
contribution provisions may be limited by applicable laws. The Placement Agent
has the necessary power and authority to enter into this Agreement and to
consummate the transactions contemplated hereby.

 

B.            The Placement Agent is a limited
liability company duly organized and validly existing under the laws of the
State of Delaware; the execution and delivery by the Placement Agent of this
Agreement and the consummation of the transactions herein contemplated will not
result in any violation of, or be in conflict with, or constitute a default
under, any material agreement or instrument to which the Placement Agent is a
party or by which the Placement Agent or its properties are bound or any
judgment, decree, order or, to the Placement Agent’s knowledge, any material
statute, rule or regulation applicable to it.

 

C.            The information contained in the Subscription
Documents relating to the Placement Agent is complete and correct and does not
contain any untrue statement of material fact or omit to state a material fact
necessary to make the statements thereto, in light of the circumstances under
which they were made, not misleading.

 

 

D.            The Placement Agent will deliver, or
will obtain the agreement of selected dealers that they will deliver, to each
purchaser, prior to any submission by such persons of a written offer to
purchase any Securities, a copy of the Subscription Documents, as such
documents may have been most recently amended or supplemented by the Company.

 

E.             Upon receipt of executed Subscription
Documents and the payments representing subscriptions for such Securities, the
Placement Agent will promptly forward copies of the Subscription Documents to
the Company and shall forward all payments for such Securities to the Escrow
Agent.

 

F.             The Placement Agent will not
deliver the Subscription Documents to any person it does not reasonably believe
to be an Accredited Investor as defined in Regulation D.

 

G.            The Placement Agent will not take
any action that it reasonably believes would cause the Offering to violate the
provisions of Regulation D or the Act.

 

H.            The Placement Agent shall have no
obligation to insure that (a) any check, note, draft or other means of payment
for any Debentures will be honored, paid or enforceable against the subscriber
in accordance with its terms or (b) subject to the performance of the Placement
Agent’s obligations and the accuracy of the Placement Agent’s representations
and warranties hereunder, the Offering is exempt from the registration
requirements of the Act or any applicable state or foreign “blue sky” law.

 

I.              Nothing contained herein shall be
deemed to constitute a representation or warranty by the Placement Agent with
respect to the Company’s compliance with the provisions of Regulation D or the
Act.

 

J.             The Placement Agent is a member of
the National Association of Securities Dealers, Inc. (the “NASD”) and is
duly permitted under NASD rules and regulations to act in its capacity recited
herein.

 

6.  Representations, Warranties and Covenants of
the Company  

 

For
purposes of the representations warranties and covenants contained in this
Section 6, the term “Company” refers collectively to Vistula
Communications Services Inc. and its affiliates.  The Company represents, warrants and
covenants as follows:

 

A.            This Agreement has been duly and
validly authorized by the Company and is a valid and binding agreement of the
Company, enforceable in accordance with its terms, except (i) as limited by
applicable bankruptcy, insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors’ rights generally, (ii)
the exercise of judicial or administrative discretion in accordance with
general equitable principles or public policy, (iii) as limited by laws
relating to the availability of specific performance, injunctive relief or
other equitable remedies and (iv) insofar as indemnification and contribution
provisions may be limited by applicable law. 
The Agent Warrants to be issued by the Company pursuant to  this Agreement will be duly authorized and,
when the shares of common stock issuable upon exercise of the Agent Warrants (the
“Warrant Shares”) are issued and paid for in accordance with the  Agent Warrants, the Warrant Shares will be
validly issued, fully paid and non-assessable; the holders of the Warrant
Shares will not be subject to personal liability solely by reason of being such
holders; and all corporate action required to be taken for the authorization,
issuance and sale of the Warrant Shares will be duly and validly taken by the
Company.

 

 

7.  Additional Agreements

 

A.            The Placement Agent shall have the
right to send a representative (“PA Representative”) to attend and
observe (but not vote at) all meetings of the Company Board of Directors and
receive notice of such meetings and all materials distributed by the Company to
Board members in the same manner and within the same periods of time as the
members of the Board of Directors, provided, however, that the Company reserves
the right to exclude the PA Representative from access to any material or
meeting or portion thereof if the Company believes upon advice of counsel that
such exclusion is reasonably necessary to preserve the attorney-client
privilege or to protect highly confidential proprietary information or for other
similar reasons (such rights the “PA Observer Rights”).  The Placement Agent and the PA representative
shall execute the Company’s form Confidentiality Agreement attached hereto as Exhibit
G prior to the PA Representative observing meetings of the Company’s Board
of Directors or receiving any materials distributed by the Company to Board
members.   The PA Observer Rights
described in this Paragraph 7.A. shall terminate on the earlier of: (i) two (2)
years from the date hereof, or (ii) the date on which at least two-thirds (2/3)
of the Debentures have been converted.

 

8.  Indemnification

 

A.            The Company agrees to indemnify and
hold harmless the Placement Agent, its employees and representatives and each
person who controls the Placement Agent within the meaning of Section 15 of the
Act against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the Securities
Act or any other statute or at common law in connection with(i) any breach of
any representation or warranty of the Company under this Agreement or the
Subscription Documents; (ii) any untrue statement of a material fact by the
Company in the Subscription Documents; or (iii) any omission of a material fact
necessary in order to make the statements in the Subscription Documents, in
light of the circumstance under which they were made, not misleading (the “Covered
Matters”) , and to reimburse persons indemnified as above for any legal or
other expense (including the cost of any investigation and preparation)
incurred by them in connection with any litigation arising from any of the
Covered Matters whether or not resulting in any liability, provided, however,
that the indemnity agreement contained in this Section 8.A. shall not apply to
amounts paid in settlement of any such litigation if such settlement is
effected without the consent of the Company, nor shall it apply to the
Placement Agent or any person controlling the Placement Agent in respect of any
such losses, claims, damages, or liabilities arising out of, or based upon, any
such untrue statement or alleged untrue statement, or any such omission or
alleged omission, if such statement or omission was based upon information
furnished by the Placement Agent specifically for use in connection with the
preparation of documents to be provided to prospective investors or any
amendment thereof or supplement thereto or by reason of improper selling
practices (including failure to comply with, or a violation of, any law or
regulation by the Placement Agent, its officers, directors and registered
placement agents).  The Placement Agent
agrees within ten days after the receipt by it of written notice of the
commencement of any action against it or against any person controlling it as
aforesaid, in respect of which indemnity may be sought from the Company on
account of the indemnity agreement contained in this Section 8.A., to notify
the Company in writing of the commencement thereof.  The omission of the Placement Agent so to
notify the Company of any such action shall not relieve the Company from any
liability which it may have to the Placement Agent or any person controlling it
as aforesaid on account of the indemnity agreement contained in this subsection
except to the extent that such liability would not have been incurred had such
notice been given.  In case any such
action shall be brought against the Placement Agent or any such controlling
person and the Placement Agent shall notify the Company of the commencement
thereof, the Company shall be entitled to participate in (and, to the extent
that it shall

 

 

wish, to direct) the defense thereof at its
own expense but such defense shall be conducted by counsel of recognized
standing and reasonably satisfactory to the Placement Agent or such controlling
person or persons, defendant or defendants in the litigation; provided, that
the Company shall not be required to pay for more than one firm of counsel for
all indemnified parties.  The Company
agrees to notify the Placement Agent promptly of the commencement of any
litigation or proceeding against it or in connection with the issue and sale of
any of its securities and to furnish to the Placement Agent, at its request,
copies of all pleadings therein and permit the Placement Agent to be an observer
therein and apprise the Placement Agent of all developments therein, all at the
Company’s expense.

 

B.            The Placement Agent agrees, in the
same manner and to the same extent as set forth in Section 8.A. of this
Agreement, to indemnify and hold harmless the Company, its officers, directors,
employees and representatives, and each person, if any, who controls the
Company within the meaning of Section 15 of the Act, with respect to any
statement in or omission from the information provided to investors any
amendments thereto, if such statement or omission was made in reliance upon
information furnished in writing to the Company by the Placement Agent, on its
behalf, specifically for use in connection with the preparation of documents to
be provided to prospective investors or any amendment thereof or supplement
thereto or by reason of improper selling practices (including failure to comply
with, or a violation of, any law or regulation by the Placement Agent, its
officers, directors and registered placement agents). The Placement Agent shall
not be liable for amounts paid in settlement of any such litigation if such
settlement was effected without its consent. 
In case of commencement of any action, in respect of which indemnity may
be sought from the Placement Agent on account of the indemnity agreement
contained in this Section 8.B., each person agreed to be indemnified by the
Placement Agent shall have the same obligation to notify the Placement Agent as
the Placement Agent has toward the Company in Section 8.A. of this Agreement,
subject to the same potential loss or reduction of indemnity in the event such
notice is not given, and the Placement Agent shall have the same right to
participate in (and to the extent that it shall wish, to direct) the defense of
such action at its own expense, but such defense shall be conducted by one firm
of counsel of recognized standing and satisfactory to the Company.  The Placement Agent agrees to notify the
Company promptly of the commencement of any litigation or proceeding against it
or against any such controlling person, of which it may be advised, in
connection with the issue and sale of any of the securities of the Company, and
to furnish the Company at its request copies of all pleadings therein and
permit the Company to be an observer therein and apprise it of all developments
therein, all at the Placement Agent’s expense.

 

C.            The respective indemnity agreements
between the Placement Agent and the Company contained in Sections 8.A. and 8.B.
of this Agreement, and the representations and warranties of the Company set
forth elsewhere in this Agreement, shall remain operative and in full force and
effect, regardless of any investigation made by or on behalf of the Placement
Agent or by or on behalf of any controlling person of the Placement Agent or
the Company any controlling person of the Company, shall survive the delivery
of the Securities.  Any successor of the
Company and the Placement Agent or of any controlling person of the Placement
Agent, as the case may be, shall be entitled to the benefits of the respective
indemnity agreements.

 

D.            In order to provide for just and
equitable contribution under the Act in any case in which (i) any person
entitled to indemnification under this Section 8 makes claim for indemnification
pursuant hereto but it is judicially determined (by the entry of a final
judgment or decree by a court of competent jurisdiction and the expiration of
time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
this Section 8 provides for indemnification in such case, or (ii) contribution
under the Act may be required on the part of any such person in circumstances
for which indemnification is provided under this Section 8, then, and in each
such case, the Company and the Placement Agent shall contribute to the
aggregate losses, claims,

 

 

damages or liabilities to which they may be
subject (after any contribution from others) in such proportions so that the
Placement Agent is responsible for the proportion that the fees provided for
herein bear to the purchase price of the Securities, and the Company is
responsible for the remaining portion; provided, that, in any such case, no
person guilty of a fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.

 

E.             Within ten days after receipt by
any party to this Agreement of notice of the commencement of any action, suit
or proceeding, such party will, if a claim for contribution in respect thereof
is to be made against another party (the “contributing party”), notify the
contributing party, in writing, of the commencement thereof, but the omission
so to notify the contributing party will not relieve it from any liability
which it may have to any other party other than for contribution
hereunder.  In case any such action, suit
or proceeding is brought against any party, and such party so notifies a
contributing party or his or its Placement Agent of the commencement thereof
within the aforesaid ten days, the contributing party will be entitled to
participate therein with the notifying party and any other contributing party
similarly notified.  Any such
contributing party shall not be liable to any party seeking contribution on
account of any settlement of any claim, action or proceeding effected by such
party seeking contribution without the written consent of such contributing
party.  The contribution provisions
contained in Section 8 are in addition to any other rights or remedies which
either party hereto may have with respect to the other or hereunder.

 

9.  Payment of Expenses

 

The
Company hereby agrees to bear all of its expenses in connection with the Private
Placement, including, but not limited to, the following:  filing fees, bank escrow fees, printing and
duplicating costs, advertisements, postage and mailing expenses with respect to
the transmission of offering material, informational meeting costs, registrar
and transfer agent fees, the Company’s counsel and accounting fees, issue and
transfer taxes, if any, and any Blue Sky counsel fees and expenses of the
Placement Agent’s counsel.  In this
connection, Blue Sky applications for registration of the Securities or
exemption therefrom shall be made in such states and jurisdictions as shall be
reasonably requested by the Placement Agent provided that such states and
jurisdictions do not require the Company to qualify as a foreign corporation or
to file a general consent to service of process.

 

10.  Termination.

 

The
Company may terminate the Private Placement in its sole discretion prior to any
closing hereunder.  In the event that the
Company determines to terminate the Private Placement from and after the date
hereof through the end of the Offering Period for any reason other than the
Placement Agent’s material breach of the terms of this Agreement, the Company
shall immediately pay to the Placement Agent the amount due as set forth in
Section 4 hereof.

 

11.  Miscellaneous.

 

A.            All covenants, warranties and
representations herein contained shall survive the Closing Date and execution
of this Agreement, and any investigation made by the party relying upon such
warranty and/or representation.

 

B.            This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original,
but all which shall be deemed to be one and the same instrument.

 

 

C.            Any notice required or permitted to
be given hereunder shall be given in writing and shall be deemed effective when
either deposited in the United States mail, registered return receipt
requested, when received if personally delivered, or when sent by overnight
courier, addressed as follows:

 

	
  To
  the Placement Agent:

  	
   

  	
  Indigo
  Securities, LLC

  
	
   

  	
   

  	
  780
  Third Avenue

  
	
   

  	
   

  	
  Suite
  2302

  
	
   

  	
   

  	
  New
  York, NY 10017

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:
  Eric Brachfeld

  
	
   

  	
   

  	
   

  
	
  To
  the Company:

  	
   

  	
  Vistula
  Communications Services, Inc.

  
	
   

  	
   

  	
  40
  Portman Square, 4th Floor

  
	
   

  	
   

  	
  London
  W1H GLT

  
	
   

  	
   

  	
  United
  Kingdom

  
	
   

  	
   

  	
  Attention:
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with
  copy to:

  
	
   

  	
   

  	
  Foley
  Hoag LLP

  
	
   

  	
   

  	
  155
  Seaport Boulevard

  
	
   

  	
   

  	
  Boston,
  MA 02210

  
	
   

  	
   

  	
  Attention:
  Paul Bork, Esq.

  

 

or
to such other address of which written notice is given to the other party.

 

D.            This Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York without
giving effect to conflicts of laws.

 

E.             The parties hereto irrevocably submit to the
jurisdiction of any State or Federal Court sitting in the State of New York,
County of New York, over any suit, action, or proceeding arising out of or
relating to this Agreement.  Each party
hereto irrevocably waives, to the fullest extent permitted by law, any
objection which it may now or hereafter have to the laying of the venue of any
such suit, action, or proceeding brought in such a court and any claim that
suit, action, or proceeding has been brought in an inconvenient forum.  Each party hereto agrees that the service of
process upon it mailed by certified or registered mail, postage prepaid and
return receipt requested (and service so made shall be deemed complete three
days after the same has been posted as aforesaid) or by personal service shall
be deemed in every respect effective service of process upon it in any such
suit or proceeding.  Nothing herein shall
affect a party’s right to serve process in any other manner permitted by
law.  Each party 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.

 

F.             This Agreement contains the entire
understanding between the parties hereto with respect to the subject matter
hereof and may not be modified or amended except by a writing duly signed by
the party against whom enforcement of the modification or amendment is sought.

 

G.            If any provision of this Agreement
shall be held to be invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provision of this Agreement.

 

 

12.  Right of First Refusal.

 

The Placement Agent shall
have a right of first refusal to serve as (i) placement agent with respect to any
private offering or sale of the securities of the Company or successor to the
Company and (ii) financial advisor in any merger, acquisition, sale or similar
transaction by the Company (other than an underwritten public offering) for a
period of eighteen (18) months following the expiration of the Offering Period.

 

IN
WITNESS WHEREOF, the parties have hereto executed this Agreement as of the 15th
day of February, 2005.

 

	
  IndiGo
  Securities, LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   /s/
  Eric Brachfeld

  	
   

  	
   

  	
   

  
	
   

  	
  Eric
  Brachfeld, Managing Partner

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Vistula
  Communications Services Inc.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   /s/
  Rupert Galliers-Pratt

  	
   

  	
   

  	
   

  
	
   

  	
  Rupert
  Galliers-Pratt, President and Chief Executive Officer

  	
   

  

 

 

EXHIBIT A

 

SECURITIES PURCHASE AGREEMENT

 

[see Exhibit 10.1 to this current
report]

 

 

EXHIBIT B

 

DEBENTURE

 

[see Exhibit 4.1 to this current
report]

 

 

EXHIBIT C

 

WARRANT

 

[see Exhibit 4.2 to this current
report]

 

 

EXHIBIT D

PLACEMENT AGENT WARRANT

 

[see Exhibit 4.2 to this current
report]

 

 

EXHIBIT E

 

REGISTRATION RIGHTS AGREEMENT

 

[see Exhibit 10.2 to this current
report]

 

 

EXHIBIT F

 

ESCROW AGREEMENT

 

[see Exhibit 10.4 to this current
report]

 

 

EXHIBIT G

 

CONFIDENTIALITY AGREEMENT

 

Agreement dated                            ,
2005 (“Agreement”), by and among Vistula Communications Services, Inc., a
Delaware corporation (the “Company”), Indigo Securities, LLC, a Delaware
limited liability company (the “Placement Agent”) and the undersigned
individual (the “Observer”).  Each of the
Company, Placement Agent and Observer may be referred to individually as a “Party”
and collectively as the “Parties”.

 

WHEREAS, pursuant to the terms and conditions
contained in that certain Placement Agent Agreement dated as of February 15,
2005, by and between the Company and the Placement Agent (the “Placement Agent
Agreement”), the Company has granted the Placement Agent the right to send an
observer to attend meetings of the Company’s Board of Directors and the right
to receive certain information distributed by the Company to members of its
Board of Directors, which rights are conditioned, among other things, on the
Placement Agent and the Observer entering into a confidentiality agreement in
the form hereof;

 

WHEREAS, the Placement Agent has exercised its right
to send the undersigned Observer to attend one or more meetings of the Company’s
Board of Directors in accordance with the Placement Agent Agreement;

 

NOW, THEREFORE, for good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the Parties hereto
agree as follows:

 

1.             Proprietary Information.  As used in this Agreement, Proprietary
Information shall mean, by way of illustration and not limitation, all
information (whether or not patentable and whether or not copyrightable) owned,
possessed or used by the Company or any of its subsidiaries, including, without
limitation, any invention, discovery, development, vendor information, customer
information, apparatus, equipment, trade secret, process, patent application,
patent positioning, patent strategy, research, report, technical data,
know-how, computer program, software, software documentation, hardware design,
technology, marketing or business plan, forecast, unpublished financial
statement, budget, license, price, cost, employee list, all of the books and
records of the Company and its subsidiaries, contents of discussions at
meetings of the Company’s Board of Directors, confidential memoranda and lists
of participants in any projects involving the Company’s products or services or
proposed products or services, in each case, that is communicated to, learned
of, developed or otherwise acquired by the Observer or by the Placement
Agent.  In addition, the term “Proprietary
Information” shall be deemed to include any notes, analyses, compilations,
studies, interpretations, memoranda or other documents prepared by the Observer
or the Placement Agent which contain, reflect or are based upon, in whole or in
part furnished to the Observer or the Placement Agent pursuant hereto.

 

1.             Use,
and Disclosure of Proprietary Information. 
The Placement Agent and the Observer shall hold in confidence, and shall
not disclose (or, in the case of the Placement Agent, permit or suffer its
officers, employees or agents to disclose) to any person outside the Placement
Agent’s organization other than the Placement Agent’s attorneys or other
professional advisors

 

 

who owe a duty of confidentiality to the Placement Agent (“Permitted
Advisors”), any Proprietary Information. 
The Placement Agent, the Observer and the Permitted Advisors shall use
such Proprietary Information only in connection with the performance by the
Placement Agent of its obligations under the Placement Agent Agreement and its
representation of investors and shall not use or exploit such Proprietary
Information for their own benefit or the benefit of another without the prior
written consent of the Company.  The Observer
and the Placement Agent shall disclose Proprietary Information received by them
under this Agreement only to persons within the Placement Agent’s organization
and to Permitted Advisors who have a need to know such Proprietary Information
in connection with the performance by the Placement Agent of its obligations
under the Placement Agent Agreement and who agree to protect the
confidentiality of such Proprietary Information in accordance with the terms of
this Agreement.  The Placement Agent and
the Observer shall adopt and maintain programs and procedures which are
reasonably calculated to protect the confidentiality of Proprietary Information
and shall be responsible to the Company for any disclosure or misuse of
Proprietary Information which results from a failure to comply with this provision.  The Placement Agent and the Observer will
promptly report to the Company any actual or suspected violation of the terms
of this Agreement and will take all reasonable further steps requested by the
Company to prevent, control or remedy any such violation.

 

2.             Limitation
on Obligations.  The obligations of
the Placement Agent and the Observer specified in Section 2 above shall not
apply, and the Placement Agent and the Observer (solely for the purposes of
this Section 3, collectively, the “Receiving Parties”) shall have no further
obligations, with respect to any Proprietary Information to the extent the
Receiving Parties, can demonstrate, by substantial evidence, that such
Proprietary Information:

 

(a)           is
generally known to the public at the time of disclosure or becomes generally
known through no wrongful act on the part of the Receiving Parties;

 

(b)           is
in the Receiving Parties’ possession at the time of disclosure otherwise than
as a result of the Receiving Parties’ breach of any legal obligation;

 

(c)           becomes
known to the Receiving Parties through disclosure by sources other than the
Company having the legal right to disclose such Proprietary Information;

 

(d)           is
independently developed by the Receiving Parties without reference to or
reliance upon the Proprietary Information; or

 

(e)           is
required to be disclosed by the Receiving Parties to comply with applicable
laws or governmental regulations; provided  that the Receiving
Parties provide prior written notice of such disclosure to the Company and takes
reasonable and lawful actions to avoid and/or minimize the extent of such
disclosure.

 

3.             Ownership
of Proprietary Information.  The
Placement Agent and the Observer agree that the Company is and shall remain the
exclusive owner of the Proprietary Information and all patent, copyright, trade
secret, trademark and other intellectual property rights therein.  No license or conveyance of any such rights
to the Placement Agent or the Observer is granted or implied under this
Agreement.

 

2

 

4.             Return
of Proprietary Information.  The
Placement Agent and the Observer shall, upon the termination of the Placement
Agent Agreement or upon the request of the Company, return to the Company all
drawings, documents and other tangible manifestations of Proprietary
Information received by the Placement Agent or the Observer pursuant to this
Agreement (and all copies and reproductions thereof).

 

5.             Miscellaneous.

 

(a)           This
Agreement supersedes all prior agreements, written or oral, between the
Company, the Placement Agent and the Observer relating to the subject matter of
this Agreement.  This Agreement may not
be modified, amended or discharged, in whole or in part, except by an agreement
in writing signed by the Company, the Placement Agent and the Observer.

 

(b)           This
Agreement will be binding upon and inure to the benefit of the Parties hereto
and their respective heirs, successors and assigns. If the Placement Agent
wishes to replace the Observer under the Placement Agent Agreement with another
representative of the Placement Agent in accordance with the Placement Agent
Agreement, the Placement Agent and such replacement observer shall be required
to execute and deliver a confidentiality agreement in substantially the form of
this Agreement as a condition to the Placement Agent exercising its right to
appoint a replacement observer under the Placement Agent Agreement.

 

(c)           This
Agreement shall be construed and interpreted in accordance with the internal
laws of the State of Delaware, without giving effect to the principles of
conflicts of law thereof.

 

(d)           The
provisions of this Agreement are necessary for the protection of the business
and goodwill of the Company and are considered by the Placement Agent and the
Observer to be reasonable for such purpose. 
The Placement Agent and the Observer agree that any breach of this
Agreement will cause the Company substantial and irreparable damages and,
therefore, in the event of any such breach, in addition to other remedies which
may be available, the Company shall have the right to seek specific performance
and other injunctive and equitable relief.

 

(e)           For
the convenience of the Parties, this letter agreement may be executed by
facsimile and in counterparts, each of which shall be deemed to be an original,
and both of which taken together, shall constitute one agreement binding on the
Parties hereto.

 

[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK]

 

3

 

EXECUTED as a sealed instrument as of the day and year
first set forth above.

 

	
   

  	
  VISTULA
  COMMUNICATIONS SERVICES,

  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  INDIGO
  SECURITIES, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [name of
  observer]

  
							

 

4Exhibit 10.4

 

EXECUTION
COPY

 

ESCROW AGREEMENT

 

THIS ESCROW AGREEMENT (this “Agreement”) is
made as of February 18, 2005, by and among Vistula Communications Services,
Inc., a Delaware corporation (the “Company”), Indigo Securities, LLC, a
Delaware limited liability company (“Indigo”) the purchasers signatory
hereto (each a “Purchaser” and together the “Purchasers”), and
Feldman Weinstein LLP, with an address at 420 Lexington Avenue, New York, New
York 10170-0002 (the “Escrow Agent”). 
Capitalized terms used but not defined herein
shall have the meanings set forth in the Securities Purchase Agreement referred
to in the first recital.

 

W I T N E S S E T H:

 

WHEREAS, the Purchasers will be purchasing from the
Company, severally and not jointly with the other Purchasers, in the aggregate,
up to $10,000,000 in the aggregate, principal amount of 8% Senior Convertible
Debentures (the “Debentures”) on each Closing Date and Warrants as set
forth in the Securities Purchase Agreement (the “Purchase Agreement”)
dated the date hereof between the Purchasers and the Company, which securities
will be issued under the terms contained herein and in the Purchase Agreement;
and

 

WHEREAS, it is intended that the purchase of the
securities be consummated in accordance with the requirements set forth in
Regulation D promulgated under the Securities Act of 1933, as amended; and

 

WHEREAS, the Company and the Purchasers have requested
that the Escrow Agent hold the Subscription Amounts in escrow until the Escrow
Agent has received the Release Notice in the form attached hereto from the
Company and Indigo;

 

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

 

ARTICLE 1

 

TERMS OF THE ESCROW

 

1.1.                              The
parties hereby agree to establish an escrow account with the Escrow Agent
whereby the Escrow Agent shall hold the funds for the purchase of up to $10,000,000
in the aggregate of Debentures and Warrants as contemplated by the Purchase
Agreement.

 

1.2.                              Upon
the Escrow Agent’s receipt of the aggregate Subscription Amounts for each Closing
into its master escrow account, together with executed counterparts of this Agreement,
the Purchase Agreement and the Registration Rights Agreement, it shall
telephonically advise the Company, or the Company’s designated attorney or
agent and Indigo, of the amount of funds it has received into its master escrow
account.

 

1

 

1.3.                              Wire
transfers to the Escrow Agent shall be made as follows:

 

STERLING NATIONAL BANK

622 3RD AVENUE

NEW YORK, NY 10017

ACCOUNT NAME:  FELDMAN WEINSTEIN LLP

ABA ROUTING NO: 026007773

ACCT NO: 0814180101

REMARK:  VISTULA/[FUND NAME]

 

1.4                                 The
Company, promptly following being advised by the Escrow Agent that the Escrow
Agent has received the Subscription Amounts for each Closing along with
facsimile copies of counterpart signature pages of the Purchase Agreement,
Registration Rights Agreement and this Agreement from each Purchaser, shall
deliver to the Escrow Agent the certificates or instrument evidencing the
Securities to be issued to each Purchaser at each Closing together with:

 

(a)                                  the
Company’s executed counterpart of the Purchase Agreement;

 

(b)                                 the
Company’s executed counterpart of the Registration Rights Agreement;

 

(c)                                  the
executed opinion of Company Counsel, in the form of Exhibit D to the
Purchase Agreement; and

 

(d)                                 the
Company’s original executed counterpart of this Escrow Agreement.

 

1.5                                 In
the event that the foregoing items are not in the Escrow Agent’s possession
within five (5) Trading Days of the Escrow Agent notifying the Company that the
Escrow Agent has custody of the Subscription Amount for each Closing, then each
Purchaser shall have the right to demand the return of their portion of the
Subscription Amount.

 

1.6                                 Once
the Escrow Agent receives a Release Notice in the form attached hereto as Exhibit
X (the “Release Notice”) executed by the Company and Indigo it shall
wire the aggregate Subscription Amounts per the written instructions of the
Company and Indigo contained in the Release Notice.

 

1.7                                 Wire
transfers to the Company shall be made pursuant to written instructions from
the Company provided to the Escrow Agent on the date of the Purchase Agreement.

 

1.8                                 Once
the funds (as set forth above) have been sent per the Release Notice instructions,
the Escrow Agent shall then arrange to have the Purchase Agreement, the
Debentures, the Registration Rights Agreement, the Escrow Agreement, the
Warrants, and the opinion of counsel delivered to the appropriate parties.

 

2

 

ARTICLE II

 

MISCELLANEOUS

 

2.1                                 No
waiver or any breach of any covenant or provision herein contained shall be
deemed a waiver of any preceding or succeeding breach thereof, or of any other
covenant or provision herein contained. 
No extension of time for performance of any obligation or act shall be
deemed an extension of the time for performance of any other obligation or act.

 

2.2                                 All
notices or other communications required or permitted hereunder shall be in
writing, and shall be sent as set forth in the Purchase Agreement.

 

2.3                                 This
Escrow Agreement shall be binding upon and shall inure to the benefit of the
permitted successors and permitted assigns of the parties hereto.

 

2.4                                 This
Escrow Agreement is the final expression of, and contains the entire agreement
between, the parties with respect to the subject matter hereof and supersedes
all prior understandings with respect thereto. 
This Escrow Agreement may not be modified, changed, supplemented or
terminated, nor may any obligations hereunder be waived, except by written
instrument signed by the parties to be charged or by its agent duly authorized
in writing or as otherwise expressly permitted herein.

 

2.5                                 Whenever
required by the context of this Escrow Agreement, the singular shall include
the plural and masculine shall include the feminine.  This Escrow Agreement shall not be construed
as if it had been prepared by one of the parties, but rather as if all parties
had prepared the same.  Unless otherwise
indicated, all references to Articles are to this Escrow Agreement.

 

2.6                                 The
parties hereto expressly agree that this Escrow Agreement shall be governed by,
interpreted under and construed and enforced in accordance with the laws of the
State of New York.  Any action to
enforce, arising out of, or relating in any way to, any provisions of this
Escrow Agreement shall only be brought in a state or Federal court sitting in
New York City.

 

2.7                                 The
Escrow Agent’s duties hereunder may be altered, amended, modified or revoked
only by a writing signed by the Company, each Purchaser and the Escrow Agent.

 

2.8                                 The
Escrow Agent shall be obligated only for the performance of such duties as are
specifically set forth herein and may rely and shall be protected in relying or
refraining from acting on any instrument reasonably believed by the Escrow
Agent to be genuine and to have been signed or presented by the proper party or
parties.  The Escrow Agent shall not be
personally liable for any act the Escrow Agent may do or omit to do hereunder
as the Escrow Agent while acting in good faith and in the absence of gross
negligence, fraud or willful misconduct, and any act done or omitted by the
Escrow Agent pursuant to the advice of the Escrow Agent’s attorneys-at-law
shall be conclusive evidence of such good faith, in the absence of gross
negligence, fraud and willful misconduct.

 

2.9                                 The
Escrow Agent is hereby expressly authorized to disregard any and all warnings
given by any of the parties hereto or by any other person or corporation,
excepting only

 

3

 

orders or process of
courts of law and is hereby expressly authorized to comply with and obey
orders, judgments or decrees of any court. 
In case the Escrow Agent obeys or complies with any such order, judgment
or decree, the Escrow Agent shall not be liable to any of the parties hereto or
to any other person, firm or corporation by reason of such decree being
subsequently reversed, modified, annulled, set aside, vacated or found to have
been entered without jurisdiction.

 

2.10                           The
Escrow Agent shall not be liable in any respect on account of the identity,
authorization or rights of the parties executing or delivering or purporting to
execute or deliver the Purchase Agreement or any documents or papers deposited
or called for thereunder in the absence of gross negligence, fraud and willful
misconduct.

 

2.11                           The
Escrow Agent shall be entitled to employ such legal counsel and other experts
as the Escrow Agent may deem necessary properly to advise the Escrow Agent in
connection with the Escrow Agent’s duties hereunder, may rely upon the advice
of such counsel, and may pay such counsel reasonable compensation; provided
that the costs of such compensation shall be borne by the Escrow Agent.  The Escrow
Agent has acted as legal counsel for Bushido,
and may continue to act as legal counsel for Bushido from time to
time, notwithstanding its duties as the Escrow Agent hereunder.  The Company and the Purchasers consent to the
Escrow Agent serving as Escrow Agent hereunder and as legal counsel for Bushido and waives any claim that such representation
represents a conflict of interest on the part of the Escrow Agent.  The Company and the Purchasers understand
that Bushido and the Escrow
Agent are relying explicitly on the foregoing provision in entering into this
Escrow Agreement.

 

2.12                           The
Escrow Agent’s responsibilities as escrow agent hereunder shall terminate if
the Escrow Agent shall resign by giving written notice to the Company and the
Purchasers.  In the event of any such
resignation, the Purchasers and the Company shall appoint a successor Escrow
Agent and the Escrow Agent shall deliver to such successor Escrow Agent any
escrow funds and other documents held by the Escrow Agent.

 

2.13                           If
the Escrow Agent reasonably requires other or further instruments in connection
with this Escrow Agreement or obligations in respect hereto, the necessary
parties hereto shall join in furnishing such instruments.

 

2.14                           It
is understood and agreed that should any dispute arise with respect to the
delivery and/or ownership or right of possession of the documents or the escrow
funds held by the Escrow Agent hereunder, the Escrow Agent is authorized and
directed in the Escrow Agent’s sole discretion (1) to retain in the Escrow
Agent’s possession without liability to anyone all or any part of said
documents or the escrow funds until such disputes shall have been settled
either by mutual written agreement of the parties concerned or by a final
order, decree or judgment or a court of competent jurisdiction after the time
for appeal has expired and no appeal has been perfected, but the Escrow Agent
shall be under no duty whatsoever to institute or defend any such proceedings
or (2) to deliver the escrow funds and any other property and documents held by
the Escrow Agent hereunder to a state or Federal court having competent subject
matter jurisdiction and located in the City of New York in accordance with the
applicable procedure therefore

 

4

 

2.15                           The
Company and each Purchaser agree jointly and severally to indemnify and hold
harmless the Escrow Agent and its partners, employees, agents and
representatives from any and all claims, liabilities, costs or expenses in any
way arising from or relating to the duties or performance of the Escrow Agent
hereunder or the transactions contemplated hereby or by the Purchase Agreement
other than any such claim, liability, cost or expense to the extent the same
shall have been determined by final, unappealable judgment of a court of
competent jurisdiction to have resulted from the gross negligence, fraud or
willful misconduct of the Escrow Agent.

 

************************

 

5

 

IN WITNESS WHEREOF, the parties hereto have executed
this Escrow Agreement as of date first written above.

 

	
  VISTULA COMMUNICATIONS
  SERVICES, INC.

  
	
   

  
	
   

  
	
  By:

  	
   /s/ Rupert Galliers-Pratt

  	
   

  
	
   

  	
  Name:

  	
  Rupert Galliers-Pratt

  	
   

  
	
   

  	
  Title:

  	
  Chairman

  	
   

  
	
   

  
	
   

  
	
  INDIGO SECURITIES LLC

  
	
   

  
	
   

  
	
  By:

  	
   /s/ Eric Brachfeld

  	
   

  
	
   

  	
  Name:

  	
  Eric Brachfeld

  	
   

  
	
   

  	
  Title:

  	
  Managing Member

  	
   

  
	
   

  
	
  ESCROW AGENT:

  
	
   

  
	
  FELDMAN WEINSTEIN LLP

  
	
   

  
	
   

  
	
  By:

  	
   /s/ Joseph Smith

  	
   

  
	
   

  	
  Name:

  	
  Joseph Smith

  	
   

  
	
   

  	
  Title:

  	
  Authorized Signatory

  	
   

  
						

 

[REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK

SIGNATURE PAGES
FOR PURCHASERS FOLLOW]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing Entity:

  	
  Bushido Capital Master
  Fund, L.P.

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ Christopher
  Rossman

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         Christopher
  Rossman

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            Managing
  Director

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Oxford Capital
  Management LLC

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ Joel T.
  Comiteau

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         Joel
  T. Comiteau

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            President

  
						

 

 [SIGNATURE PAGE OF PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Stratford Partners,
  L.P.

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ Mark Fain

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         Mark
  Fain

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            General
  Partner

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Gryphon Master Fund,
  L.P.

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ E.B. Lyon IV

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         E.B.
  Lyon IV

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            Authorized
  Agent

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  GSSF Master Fund, LP

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ E.B. Lyon IV

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         E.B.
  Lyon IV

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            Authorized
  Agent

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Little Wing LP

  	
   

  
	
  Signature of Authorized Signatory
  of Investing Entity:

  	
   /s/ Parker L.
  Quillen

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         Parker
  L. Quillen

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            President
  of Quilcap, Quilcap as General Partner

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Gamma Opportunity
  Capital Partners, LP

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ Jonathan P.
  Knight

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         Jonathan
  P. Knight

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            President/Director

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Tradewinds Fund Ltd.

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ Parker L.
  Quillen

  	
   

  
	
  Name of Authorized
  Signatory:

  	
         Parker
  L. Quillen

  	
   

  
	
  Title of Authorized
  Signatory:

  	
            President
  of Quilcap, Quilcap as Investment Manager

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

[SIGNATURE PAGE OF
PURCHASERS TO VISTULA ESCROW AGREEMENT]

 

	
  Name of Investing
  Entity:

  	
  Professional Traders
  Fund, LLC

  	
   

  
	
  Signature of Authorized
  Signatory of Investing Entity:

  	
   /s/ [illegible]

  	
   

  
	
  Name of Authorized
  Signatory:

  	
     [illegible]

  	
   

  
	
  Title of Authorized
  Signatory:

  	
        Manager

  
						

 

[SIGNATURE PAGE OF
PURCHASERS FOLLOWS]

 

 

Exhibit X to

Escrow Agreement

RELEASE NOTICE

 

The UNDERSIGNED, pursuant to the Escrow Agreement,
dated as of February 18, 2005, among Vistula Communications Services, Inc., a Delaware
corporation, Indigo Securities, LLC, a Delaware limited liability company and the
Purchasers signatory thereto and Feldman Weinstein LLP, as Escrow Agent (the “Escrow
Agreement”; capitalized terms used herein and not defined shall have the
meaning ascribed to such terms in the Escrow Agreement), hereby notify the
Escrow Agent that each of the conditions precedent to the purchase and sale of
the Securities set forth in the Securities Purchase Agreement have been
satisfied.  The Company and Indigo (on
behalf of Purchasers) hereby confirm that all of their respective
representations and warranties contained in the Purchase Agreement remain true
and correct and authorize the release by the Escrow Agent of the funds and
documents to be released at each Closing as described in the Escrow Agreement.
This Release Notice shall not be effective until executed by the Company and Indigo.

 

This Release Notice may be signed in one or more
counterparts, each of which shall be deemed an original.

 

IN WITNESS WHEREOF, the undersigned have caused this Release
Notice to be duly executed and delivered as of this 18th day of
February, 2005.

 

 

	
   

  	
  VISTULA COMMUNICATIONS
  SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Rupert Galliers-Pratt

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Rupert Galliers-Pratt

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chairman

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  INDIGO SECURITIES, LLC,

  on behalf of Purchasers

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Eric Brachfeld

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Eric Brachfeld

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Managing Member

  	
   

  

 

[SIGNATURE PAGE OF PURCHASERS
FOLLOWS]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00078-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00078-of-00352.parquet"}]]