Document:

Exhibit 10.7

                               SECURITY AGREEMENT

      THIS SECURITY AGREEMENT (this "Agreement") is made as of May 31, 2005, by
and among VOIP, INC. a Texas corporation with a principal place of business
located at 12330 SW 53rd Street, Suite 712, Fort Lauderdale, FL 33330 ("VoIP"),
EGLOBALPHONE, INC. ("eGlobalphone"), VOIP SOLUTIONS, INC. ("Solutions"), DTNET
TECHNOLOGIES, INC. ("DTNet"), and VOIP AMERICAS, ("Americas") (VoIP,
eGlobalphone, Solutions, DTNet and Americas are each herein referred to as a
"Grantor" and collectively as the "Grantors") all Florida corporations with
principal place of business located at 12330 SW 53rd Street, Suite 712, Fort
Lauderdale, FL 33330, and CEDAR BOULEVARD LEASE FUNDING, LLC, a Delaware limited
liability company ("Lender").

      1. Capitalized Terms. Capitalized terms used without definition in this
Agreement shall have the meanings assigned to them in Exhibit A attached hereto
and incorporated herein by this reference.

      2. Grant of Security Interest. For valuable consideration, receipt and
sufficiency of which is hereby acknowledged, each Grantor hereby grants to
Lender a continuing security interest in and lien upon all of the personal
property of such Grantor including without limitation, such Grantor's right,
title and interest in the following described property of such Grantor, whether
now in existence or hereafter created or acquired and wheresoever situated, as
well as in the cash and non-cash proceeds thereof, including, without
limitation, insurance proceeds (all such property being hereinafter collectively
referred to as the "Collateral"):

            (a) all Receivables;

            (b) all Equipment;

            (c) all Fixtures;

            (d) all General Intangibles;

            (e) all Intellectual Property;

            (f) all Inventory;

            (g) all Investment Property;

            (h) all Deposit Accounts;

            (i) all Cash;

            (j) all other Goods and tangible and intangible personal property,
      whether now or hereafter owned or existing, leased, consigned by or to, or
      acquired by, Grantor and wherever located; and

            (k) all Proceeds of each of the foregoing and all accessions to,
      substitutions and replacements for, and rents, profits and products of
      each of the foregoing.

<PAGE>

      The security interest granted hereby is to secure the payment and
performance of all liabilities and obligations of Grantors to Lender of every
kind and description, whether direct or indirect, joint or several, absolute or
contingent, secured or unsecured, due or to become due, now existing or
hereafter arising, including, without limitation: (i) all liabilities and
obligations now or hereafter owing by Grantors to Lender under that certain
Guaranty of even date herewith (the "Guaranty"); and (ii) all liabilities and
obligations now or thereafter owing by Grantor to Lender under this Agreement.
All such liabilities and obligations are hereinafter jointly referred to as the
"Indebtedness".

      3. Subordination. Lender shall subordinate its Liens in the personal
property of VoIP and its subsidiaries, other than the Borrowers, to the Liens in
favor of any future Senior Creditor to the extent such Liens secure Senior Debt
.. For purposes of this Agreement (i) "Senior Creditor" shall mean a bank,
insurance company, pension fund, or accredited investor, or a syndicate of such
institutional lenders that provides Senior Debt financing to VoIP and its
subsidiaries; provided, that Senior Creditor shall not include any officer,
director, or insider of VoIP or any of its subsidiaries, or any affiliate of the
foregoing Persons except upon the express written consent of Lender, (ii)
"Senior Debt" shall mean any and all indebtedness and obligations for borrowed
money (including principal, premium (if any), interest, fees, charges, expenses,
costs, professional fees and expenses, and reimbursement obligations) at any
time owing by VoIP to Senior Creditor under the Senior Loan Documents, including
such amounts as may accrue or be incurred before or after default or workout or
the commencement of any liquidation, dissolution, bankruptcy, receivership or
reorganization by or against Borrower; provided, that Senior Debt shall not
include debt exceeding five million and No/100 Dollars ($5,000,000.00)
outstanding at any one time, and (iii) "Senior Loan Documents" means a loan
agreement between Borrower and Senior Creditor and any other agreement, security
agreement, document, promissory note, UCC financing statement, or instrument
executed by Borrower in favor of Senior Creditor pursuant to or in connection
with the Senior Debt, as the same may from time to time be amended, modified,
supplemented, extended, renewed, restated or replaced.

      4. Covenants, Representations, and Warranties of Grantor. Each Grantor
hereby represents, covenants, warrants, and agrees to and with Lender as
follows:

            (a) Grantor is a corporation duly organized, validly existing and in
      good standing under the laws of the state of its incorporation or
      formation (as the case may be), and as of the date hereof has its chief
      executive office and principal place of business indicated at the
      beginning of this Agreement.

            (b) All risk of loss with respect to the Collateral hereunder shall
      be upon Grantor, provided, however, that Lender shall bear the risk of
      loss with respect to any Collateral in its possession.

            (c) Grantor shall keep the Collateral free and clear from any and
      all security interests, unpaid charges, attachments, levies, and liens of
      every kind, except for (i) the lien and security interest granted
      hereunder to Lender hereunder, and (ii) Permitted Liens.

            (d) No Grantor shall dispose of any material item of Collateral
      except for sales of inventory in the ordinary course of business.

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<PAGE>

            (e) Grantor shall keep and maintain all tangible items of Collateral
      in saleable condition, and Grantor agrees that (i) the Collateral may be
      inspected and examined by Lender or its agents at any reasonable time,
      upon reasonable notice, and (ii) upon two (2) business days' notice and at
      any reasonable time, Lender shall have the right to inspect, audit,
      examine, check, or make copies of, or extracts from, the books, files,
      accounts, and all other records of Grantor pertaining to Grantor's
      business or any of the Collateral.

            (f) Grantor shall maintain, with financially sound and reputable
      insurers, insurance with respect to its properties and business against
      such casualties and contingencies of such type and in such amounts as is
      customary in Grantor's business. In addition, Grantor shall cause its
      insurers to deliver to Lender additional insured and lender loss payable
      endorsements for all such insurance policies, in form satisfactory to
      Lender.

            (g) Grantor will execute, or cause to be executed, and deliver to
      Lender upon Lender's request, any and all instruments or documents
      necessary or desirable to give effect to this Agreement or to perfect
      Lender's security interest in any Collateral, including specifically all
      financing statements, control agreements, motor vehicle titles with
      Lender's lien noted thereon, landlord waivers, mortgagee waivers and
      subordination agreements and the delivery to Lender of stock certificates
      evidencing any securities owned by Grantor, and Grantor shall reimburse
      Lender for the cost of filing or recording any such documents in all
      public offices deemed necessary by Lender.

            (h) No Grantor shall change its corporate name, organizational form
      or jurisdiction of formation without thirty (30) days' prior written
      notice to Lender and hereby authorizes Lender to file amended financing
      statements, in form satisfactory to Lender, to perfect or continue the
      perfection of Lender's lien and security interest hereunder.

            (i) Exhibit B is a true, correct and complete list of (a) all banks
      and other financial institutions at which Grantor maintains Deposit
      Accounts and (b) institutions at which Grantor maintains accounts holding
      Investment Property owned by Grantor, and such exhibit correctly
      identifies the name, address and telephone number of each bank or other
      institution, the name in which the account is held, a description of the
      purpose of the account, and the complete account number therefor. Grantor
      shall not maintain any Deposit Accounts or accounts holding Investment
      Property owned by Grantor except (i) accounts identified in Exhibit B and
      (ii) other accounts with respect to which Lender has a perfected security
      interest in each such account. No Grantor shall transfer or cause to be
      transferred any funds from any Deposit Account or account holding
      Investment Property of any Borrower into any Deposit Account or account
      holding Investment Property of any Grantor unless and until Lender has a
      perfected security interest in such account.

            (j) Grantor shall comply with the requirements of all applicable
      laws, rules, regulations and orders of any governmental authority, the
      noncompliance with which would materially and adversely affect its
      properties, business or credit.

                                       3
<PAGE>

            (k) Grantor promises to pay any and all reasonable attorneys' and
      other professionals' fees and expenses incurred by Lender in connection
      with or related to: (a) the administration, collection, or enforcement of
      this Agreement or the Guaranty or the Indebtedness; (b) the amendment or
      modification of this Agreement or the Guaranty or any other agreement
      evidencing the Indebtedness; (c) any waiver, consent, release, or
      termination under this Agreement or Guaranty or any other agreement
      evidencing the Indebtedness; (d) the protection, preservation, sale,
      lease, liquidation, or disposition of Collateral or the exercise of
      remedies with respect to the Collateral; (e) any legal, litigation,
      administrative, arbitration, or out of court proceeding in connection with
      or related to Grantor or the Collateral, and any appeal or review thereof,
      unless Grantor is the prevailing party; and (f) any bankruptcy,
      restructuring, reorganization, assignment for the benefit of creditors,
      workout, foreclosure, or other action related to Grantor, the Collateral,
      this Agreement or Guaranty or any other agreement evidencing the
      Indebtedness, including representing Lender in any adversary proceeding or
      contested matter commenced or continued by or on behalf of Grantor's
      estate, and any appeal or review thereof, unless Grantor is the prevailing
      party. Lender's professional fees and expenses shall include reasonable
      fees or expenses for Lender's attorneys, accountants, auctioneers,
      liquidators, appraisers, investment advisors, environmental and management
      consultants, or experts engaged by Lender in connection with the
      foregoing. Grantor's promise to pay all of Lender's reasonable
      professional fees and expenses is part of the Indebtedness under this
      Agreement. For the purposes of this Section 4(k), attorneys' fees shall
      include, without limitation, fees incurred in connection with the
      following: (i) contempt proceedings; (ii) discovery; (iii) any motion,
      proceeding or other activity of any kind in connection with an insolvency
      proceeding; (iv) garnishment, levy, and debtor and third party
      examinations; and (v) post-judgment motions and proceedings of any kind,
      including without limitation any activity taken to collect or enforce any
      judgment. All of the foregoing costs and expenses shall be payable upon
      demand by Lender, and if not paid within thirty (30) days of presentation
      of invoices shall bear interest at the Default Rate.

            (l) To the best of its knowledge after due inquiry and
      investigation, there are no actions, suits or proceedings now pending or
      threatened against any Grantor or affecting any of any Grantor's
      properties as to which there is a reasonable likelihood of an adverse
      determination and which, if adversely determined, could, individually or
      in the aggregate, reasonably be expected to materially and adversely
      affect its properties, business or credit.

            (m) Grantor's present name, former names (if any), locations, and
      other information are correctly set forth in Exhibit C.

            (n) Exhibit D is a true, correct and complete list of each of
      Grantor's Patents, Trademarks, Copyrights and Licenses, together with
      application or registration numbers, as applicable.

            (o) Exhibit E is a true and correct list identifying all
      subsidiaries, parents and affiliates of Grantor.

                                       4
<PAGE>

            (p) No Grantor shall (i) pay any dividends or make any distributions
      on its Equity Securities; (ii) purchase, redeem, retire, defease or
      otherwise acquire for value any of its Equity Securities (other than
      repurchases by cancellation of indebtedness pursuant to the terms of
      employee stock purchase plans, employee restricted stock agreements or
      similar arrangements in an aggregate amount not to exceed $100,000); (iii)
      return any capital to any holder of its Equity Securities as such; (iv)
      make any distribution of assets, Equity Securities, obligations or
      securities to any holder of its Equity Securities as such; or (v) set
      apart any sum for any such purpose.

            (q) VoIP shall provide the following to Lender, promptly as they are
      available, (i) unaudited monthly consolidated and consolidating financial
      statements (but in any event within 21 days of month end), (ii) audited
      annual consolidated and consolidating financial statements (but in any
      event within 90 days of year end), and (iii) such other financial
      information as Lender may reasonably request from time to time and upon
      reasonable advance written notice given to VoIP from Lender.

            (r) All of the information and documents heretofore, concurrently
      herewith or hereafter to be furnished to Lender pursuant to or in
      connection with this Agreement and the Lender Agreement and the Lender
      Loan Agreement are and will be true, correct, accurate and complete in all
      material respects.

      5. Events of Default. It is understood and agreed that an "Event of
Default" shall be deemed to have occurred under this Agreement, and Lender shall
be entitled to take such actions as are elsewhere provided herein, in the event
that:

            (a) Any Grantor fails to pay any of the Indebtedness to Lender on
      the payment due date and any applicable cure period under the Guaranty or
      other documentation evidencing the Indebtedness has expired; or (b) any
      Grantor fails to keep or perform any of the covenants or agreements
      contained herein or in any other existing agreement with Lender (other
      than a covenant or agreement to pay); (c) any representation or warranty
      of any Grantor herein shall prove to have been false, incorrect or
      misleading in any material respect when made or furnished or is breached,
      violated, or not complied with; (d) an event of default under the Guaranty
      has occurred; and any applicable cure period has expired (e) any
      bankruptcy petition with respect to any Grantor shall hereafter be filed
      by such Grantor or any receiver, trustee or other custodian shall be
      appointed for any Grantor or any of its properties upon such Grantor's
      request, or (f) any bankruptcy petition with respect to any Grantor shall
      hereafter be filed by a third party against such Grantor, or any receiver,
      trustee or other custodian shall be appointed for any Grantor or any of
      its properties upon a third party's request.

      6. Rights and Remedies Upon Default. Upon and after the occurrence and
during the continuation of any one or more of the Events of Default specified in
Section 5 hereof, all of the Indebtedness shall, at the option of Lender and
without any notice to or demand upon any Grantor of any kind (other than any
required by applicable law, but only to the extent the waiver of such notice by
such Grantor hereunder is not legally enforceable), become immediately due and
payable, and Lender shall thereupon have any and all rights and remedies

                                       5
<PAGE>

afforded to a secured party under the UCC, together with every right and remedy
available to Lender under any other applicable law, including, the right to
release, hold, sell, lease, liquidate, collect, realize upon, or otherwise
dispose of all or any part of the Collateral and the right to occupy, utilize,
process and commingle the Collateral. All of Lender's rights and remedies shall
be cumulative and not exclusive and may be exercised concurrently or seriatim,
and are in addition to and not in lieu of any other rights of Lender at law, in
equity, under statute or under any other agreement with any Grantor. Upon the
occurrence and during the continuance of any Event of Default, Lender may, at
any time or from time to time, apply, collect, liquidate, sell in one or more
sales, lease or otherwise dispose of, any or all of the Collateral, in its then
condition or following any commercially reasonable preparation or processing, in
such order as Lender may elect. Lender acknowledges and agrees that Grantors
shall have the right to redeem the Collateral in accordance with the provisions
of Section 9-623 of the UCC and that Lender shall give Grantors five (5)
calendar days notice of any sale or other disposition of any of the Collateral
pursuant hereto.

      7. Waivers. In addition to the other waivers contained herein and in any
other agreement between Grantors and Lender, each Grantor hereby expressly
waives, to the extent permitted by law, demand, protest, notice of protest,
notice of default or dishonor, notice of payments and nonpayments, or of any
default, release, compromise, settlement, extension or renewal of all commercial
paper, instruments or guaranties at any time held by Lender on which such
Grantor may in any way be liable, and notice of any action taken by Lender
unless expressly required by this Agreement or by law.

      8. Indulgences Not Waivers. Neither the failure nor any delay on the part
of Lender to exercise any right, remedy, power or privilege hereunder shall
operate as a waiver thereof or give rise to any estoppel, nor be construed as an
agreement to modify the terms of this Agreement, nor shall any single or partial
exercise by Lender of any right, remedy, power or privilege preclude any other
or further exercise by Lender of the same or of any other right, remedy, power,
or privilege; nor shall any waiver by Lender of any right, remedy, power or
privilege with respect to any occurrence be construed as a waiver of such right,
remedy, power or privilege with respect to any other occurrence. No waiver by a
party hereunder shall be effective unless it is in writing and signed by the
party making such waiver, and then only to the extent specifically stated in
such writing.

      9. Notices. Except as otherwise provided herein, any notice, demand,
request, consent, approval, declaration, service of process or other
communication (including the delivery of Financial Statements) that is required,
contemplated, or permitted under this Agreement or with respect to the subject
matter hereof shall be in writing, and shall be deemed to have been validly
served, given, delivered, and received upon the earlier of: (i) the first
business day after transmission by facsimile (receipt confirmed) or hand
delivery or deposit with an overnight express service or overnight mail delivery
service; or (ii) the fifth calendar day after deposit in the United States
mails, with proper first class postage prepaid, and shall be addressed to the
party to be notified as follows:

                                       6
<PAGE>

                  If to Lender:          Cedar Boulevard Lease Funding LLC
                                         Jan Haas, Managing Partner
                                         22 South Main St., Suite 1
                                         Topsfield, MA  01983
                                         Fax: (978) 887-0292
                                         Phone: (978) 887-0298

                  with copies to:
                                         Winston & Strawn LLP
                                         Attention: John D. Fredericks, Esq.
                                         101 California Street, 39th Floor
                                         San Francisco, CA 94111
                                         Fax: (415) 591-1400
                                         Phone: (415) 591-1000

                   If to Grantors:
                                         c/o Voip, Inc.
                                         12330 SW 53rd St., Suite 712
                                         Fort Lauderdale, FL  33330
                                         Fax: (954) 434-2877
                                         Phone: (954) 434-2000

                                         Andrews Kurth LLP
                                         Attn:  Ronald L. Brown
                                         1717 Main St., Suite 3700
                                         Dallas, TX 75201
                                         Fax:  (214) 659-4819
                                         Phone:  (214) 659-4469

or to such other address as each party may designate for itself by like notice.

      10. Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Illinois, excluding
conflict of laws principles that would cause the application of laws of any
other jurisdiction. In the event of any dispute concerning, or action to enforce
this Agreement, each Grantor and Lender hereby consent to the venue and
jurisdiction of the state and federal courts located in Cook County, Illinois,
and waive any right to object thereto.

      11. Entire Agreement. This Agreement constitutes and expresses the entire
understanding between the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
understandings, inducements or conditions, and the express terms hereof control
and supersede any course of performance and/or usage of the trade inconsistent
with any of the terms hereof. Neither this Agreement nor any portion or
provision hereof may be changed, altered, waived, modified, supplemented,
discharged, canceled, terminated, or amended orally or in any manner other than
by an agreement in writing signed by the parties hereto.

                                       7
<PAGE>

      12. Paragraph Headings. The paragraph headings in this Agreement are for
convenience of reference only; they form no part of this Agreement and shall not
affect its interpretation.

      13. Severability. The provisions of this Agreement are independent of and
separable from each other. If any provision hereof shall for any reason be held
invalid or unenforceable, such invalidity or unenforceability shall not affect
the validity or enforceability of any other provision hereof, but this Agreement
shall be construed as if such invalid or unenforceable provision had never been
contained herein.

      14. Successors and Assigns. The rights, remedies, powers, and privileges
of Lender hereunder shall inure to the benefit of the successors and assigns of
Lender, and the duties and obligations of Grantors hereunder shall bind the
heirs, executors, administrators, successors and assigns of Grantors. Lender may
assign, or sell participations in, its right, title and interest herein, in any
of the Indebtedness, in the Collateral, and in any agreements or instruments now
or hereafter evidencing or securing any agreements or instruments now or
hereafter evidencing or securing any of the Indebtedness at any time or times
without notice to or the consent of any Grantor. However, Grantors may rely on
Lender continuing to hold the Indebtedness and any agreements or instruments
evidencing or securing the Indebtedness until Grantors receive actual notice
from Lender of any such assignment.

      15. Mutual Waiver Of Jury Trial. Because disputes arising in connection
with complex financial transactions are most quickly and economically resolved
by an experienced and expert person and the parties wish applicable state and
federal laws to apply (rather than arbitration rules), the parties desire that
their disputes be resolved by a judge applying such applicable laws. LENDER AND
EACH GRANTOR SPECIFICALLY WAIVES ANY RIGHT IT MAY HAVE TO TRIAL BY JURY OF ANY
CAUSE OF ACTION, CLAIM, CROSS-CLAIM, COUNTERCLAIM, THIRD PARTY CLAIM OR ANY
OTHER CLAIM ARISING OUT OF THIS AGREEMENT (COLLECTIVELY, "CLAIMS") ASSERTED BY
ANY GRANTOR AGAINST LENDER OR ITS ASSIGNEE OR BY LENDER OR ITS ASSIGNEE AGAINST
ANY GRANTOR. This waiver extends to all such Claims, including Claims that
involve Persons other than Grantors and Lender.

      16. WAIVERS. EACH GRANTOR ACKNOWLEDGES THAT THE FOREGOING WAIVERS ARE A
MATERIAL INDUCEMENT TO LENDER'S ENTERING INTO THIS AGREEMENT AND THAT LENDER IS
RELYING UPON THE FOREGOING WAIVERS IN ITS FUTURE DEALINGS WITH GRANTORS. EACH
GRANTOR WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THE FOREGOING WAIVERS WITH
ITS LEGAL COUNSEL AND HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, THIS
AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

      17. Miscellaneous. Time is of the essence of this Agreement.

      18. Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of

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<PAGE>

which when so delivered shall be deemed an original, but all of which
counterparts shall constitute but one and the same instrument. Delivery of an
executed counterpart of a signature page to this Agreement by facsimile
transmission shall be effective as delivery of a manually executed counterpart
thereof.

                  [Remainder of Page Intentionally Left Blank]

                                       9
<PAGE>

SECURITY AGREEMENT SIGNATURE PAGE

      IN WITNESS WHEREOF, Lender and each Grantor have duly executed and
delivered this Agreement as of the day and year first above written.

         GRANTORS:      VOIP, INC.

                        Signature:          /s/ Steven Ivester
                                          ----------------------------------
                        Print Name:         Steven Ivester
                                          ----------------------------------
                        Title:              Chief Executive Officer
                                          ----------------------------------

                        EGLOBALPHONE, INC.

                        Signature:          /s/ Steven Ivester
                                          ----------------------------------
                        Print Name:         Steven Ivester
                                          ----------------------------------
                        Title:              Chief Executive Officer
                                          ----------------------------------

                        VOIP SOLUTIONS, INC.

                        Signature:          /s/ Steven Ivester
                                          ----------------------------------
                        Print Name:         Steven Ivester
                                          ----------------------------------
                        Title:              Chief Executive Officer
                                          ----------------------------------

                        DTNET TECHNOLOGIES, INC.

                        Signature:          /s/ Steven Ivester
                                          ----------------------------------
                        Print Name:         Steven Ivester
                                          ----------------------------------
                        Title:              Chief Executive Officer
                                          ----------------------------------

                        VOIP AMERICAS, INC.

                        Signature:          /s/ Steven Ivester
                                          ----------------------------------
                        Print Name:         Steven Ivester
                                          ----------------------------------
                        Title:              Chief Executive Officer
                                          ----------------------------------

                                       10
<PAGE>

         LENDER:        CEDAR BOULEVARD LEASE FUNDING, LLC

                        Signature:          /s/ Constantine Dakolias
                                          ----------------------------------
                        Print Name:         Constantine Dakolias
                                          ----------------------------------
                        Title:              Chief Credit Officer
                                          ----------------------------------

                                       11
<PAGE>

                                    EXHIBIT A
                                       TO
                               SECURITY AGREEMENT

                                   DEFINITIONS

"Account" means any "account," as such term is defined in the UCC, now owned or
hereafter acquired by any Grantor or in which any Grantor now holds or hereafter
acquires any interest and, in any event, shall include, without limitation, all
accounts receivable, book debts, rights to payment, and other forms of
obligations now owned or hereafter received or acquired by or belonging or owing
to any Grantor (including, without limitation, under any trade name, style or
division thereof), whether or not arising out of goods or software sold or
services rendered by any Grantor or from any other transaction (including,
without limitation, any such obligation that may be characterized as an account
or contract right under the UCC), and all of any Grantor's rights in, to and
under all purchase orders or receipts now owned or hereafter acquired by it for
goods or services, and all of any Grantor's rights to any goods represented by
any of the foregoing (including, without limitation, unpaid seller's rights of
rescission, replevin, reclamation and stoppage in transit and rights to
returned, reclaimed or repossessed goods), and all monies due or to become due
to any Grantor under all purchase orders and contracts for the sale of goods or
the performance of services or both by any Grantor or in connection with any
other transaction (whether or not yet earned by performance on the part of any
Grantor), now in existence or hereafter occurring, including, without
limitation, the right to receive the proceeds of said purchase orders and
contracts, and all collateral security and guarantees of any kind given by any
Person with respect to any of the foregoing.

"Agreement" means the Security Agreement dated as of May __, 2005, by and among
Grantors and Lender, as the same may be amended, supplemented, restated, or
otherwise modified from time to time, in accordance with the terms hereof.

"Borrowers" means the Borrowers under that certain Subordinated Loan and
Security Agreement dated as of June 1, 2004, as amended by that certain First
Amendment to Subordinated Loan and Security Agreement dated as of July 22, 2004,
and that certain Second Amendment to Subordinated Loan and Security Agreement
dated as of August 27, 2004.

"Cash" means all cash, money, currency, and liquid funds, wherever held, in
which any Grantor now or hereafter acquires any right, title, or interest.

"Claims" shall have the meaning attributed to such term in Section 15 of this
Agreement.

"Collateral" shall have the meaning attributed to such term in Section 2 of this
Agreement.

"Chattel Paper" means any "chattel paper," as such term is defined in the UCC,
now owned or hereafter acquired by any Grantor or in which any Grantor now holds
or hereafter acquires any interest.

"Copyright License" means any written agreement granting any right to use any
Copyright or Copyright registration, now owned or hereafter acquired by any
Grantor or in which any Grantor now holds or hereafter acquires any interest.

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<PAGE>

"Copyrights" means all of the following property, now owned or hereafter
acquired by any Grantor or in which any Grantor now holds or hereafter acquires
any interest: (i) all copyrights, whether registered or unregistered, held
pursuant to the laws of the United States, any State thereof, or of any other
country; (ii) all registrations, applications and recordings in the United
States Copyright Office or in any similar office or agency of the United States,
of any State thereof, or of any other country; (iii) all continuations, renewals
or extensions thereof; and (iv) all registrations to be issued under any pending
applications.

"Default Rate" means 17.5%, but such rate shall in no event be more than the
highest rate permitted by applicable law.

"Deposit Accounts" means any "deposit accounts," as such term is defined in the
UCC, and includes any checking account, savings account, or certificate of
deposit now owned or hereafter acquired by any Grantor or in which any Grantor
now holds or hereafter acquires any interest.

"Documents" means any "documents," as such term is defined in the UCC, now owned
or hereafter acquired by any Grantor or in which any Grantor now holds or
hereafter acquires any interest.

"Equipment" means any "equipment," as such term is defined in the UCC, and any
and all additions, upgrades, substitutions, and replacements of the foregoing,
together with all attachments, components, parts, accessions, and accessories
installed thereon or affixed thereto, now owned or hereafter acquired by any
Grantor or in which any Grantor now holds or hereafter acquires any interest.

"Equity Securities" of any Person shall mean (a) all common stock, preferred
stock, participations, shares, partnership interests or other equity interests
in and of such Person (regardless of how designated and whether or not voting or
non-voting) and (b) all warrants, options and other rights to acquire any of the
foregoing.

"Event of Default" shall have the meaning attributed to such term in Section 5
of this Agreement.

"Fixtures" means any "fixtures," as such term is defined in the UCC, together
with all right, title and interest of any Grantor in and to all extensions,
improvements, betterments, accessions, renewals, substitutes, and replacements
of, and all additions and appurtenances to any of the foregoing property, and
all conversions of the security constituted thereby, immediately upon any
acquisition or release thereof or any such conversion, as the case may be, now
owned or hereafter acquired by any Grantor or in which any Grantor now holds or
hereafter acquires any interest.

"General Intangibles" means any "general intangibles," as such term is defined
in the UCC, and, in any event, shall include, without limitation, all right,
title and interest which any Grantor may now or hereafter have in or under any
rights to payment; payment intangibles; software; proprietary or confidential
information; business records and materials; customer lists; interests in
partnerships, joint ventures, business associations, corporations, and limited
liability companies; permits; claims in or under insurance policies (including
unearned premiums and retrospective premium adjustments); and rights to receive

                                      A-2
<PAGE>

tax refunds and other payments and rights of indemnification now owned or
hereafter acquired by any Grantor or in which any Grantor now holds or hereafter
acquires any interest.

"Goods" means any "goods," as such term is defined in the UCC, now owned or
hereafter acquired by any Grantor or in which any Grantor now holds or hereafter
acquires any interest.

"Grantor" and "Grantors" shall have the meanings assigned thereto in the
preamble to the Agreement.

"Indebtedness" shall have the meaning attributed to such term in Section 2 of
this Agreement.

"Instruments" means any "instrument," as such term is defined in the UCC, now
owned or hereafter acquired by any Grantor or in which any Grantor now holds or
hereafter acquires any interest.

"Intellectual Property" means all Copyrights; Trademarks; Patents; Licenses;
source codes developed by any Grantor; trade secrets; inventions (whether or not
patented or patentable); technical information, procedures, processes, designs,
knowledge, and know-how; data bases; models; drawings; skill, expertise, and
experience; websites, domain names, and URL's; and applications therefor and
reissues, extensions, or renewals thereof; and goodwill associated with any of
the foregoing; together with rights to sue for past, present and future
infringement of Intellectual Property and the goodwill associated therewith.

"Inventory" means any "inventory," as such term is defined in the UCC, now owned
or hereafter acquired by any Grantor or in which any Grantor now holds or
hereafter acquires any interest, and, in any event, shall include, without
limitation, all Goods and personal property that are held by or on behalf of any
Grantor for sale or lease or are furnished or are to be furnished under a
contract of service, or that constitute raw materials, work in process or
materials used or consumed or to be used or consumed in any Grantor's business,
or the processing, packaging, promotion, delivery or shipping of the same, and
all finished goods, whether or not the same is in transit or in the
constructive, actual or exclusive possession of any Grantor or is held by others
for any Grantor's account, including, without limitation, all property covered
by purchase orders and contracts with suppliers and all Goods billed and held by
suppliers and all such property that may be in the possession or custody of any
carriers, forwarding agents, truckers, warehousemen, vendors, selling agents or
other Persons.

"Investment Property" means any "investment property," as such term is defined
in the UCC, and includes any certificated security, uncertificated security,
money market funds, bonds, mutual funds, and U.S. Treasury bills or notes, now
owned or hereafter acquired by any Grantor or in which any Grantor now holds or
hereafter acquires any interest.

"Letter of Credit Rights" means any "letter of credit rights," as such term is
defined in the UCC, now owned or hereafter acquired by any Grantor or in which
any Grantor now holds or hereafter acquires any interest, including any right to
payment or performance under any letter of credit.

"Licenses" means any Copyright License, Patent License, Trademark License or
other license of rights or interests now held or hereafter acquired by any
Grantor or in which any Grantor now holds or hereafter acquires any interest and
any renewals or extensions thereof.

                                      A-3
<PAGE>

"Lien" means any mortgage, deed of trust, pledge, hypothecation, assignment for
security, security interest, encumbrance, levy, lien or charge of any kind,
whether voluntarily incurred or arising by operation of law or otherwise,
against any property, any conditional sale or other title retention agreement,
any lease in the nature of a security interest, and the filing of any financing
statement (other than a precautionary financing statement with respect to a
lease that is not in the nature of a security interest) under the UCC or
comparable law of any jurisdiction.

"Patent License" means any written agreement granting any right with respect to
any invention on which a Patent is in existence or a Patent application is
pending, in which agreement any Grantor now holds or hereafter acquires any
interest.

"Patents" means all of the following property, now owned or hereafter acquired
by any Grantor or in which any Grantor now holds or hereafter acquires any
interest: (a) all letters patent of, or rights corresponding thereto, in the
United States or in any other country, all registrations and recordings thereof,
and all applications for letters patent of, or rights corresponding thereto, in
the United States or any other country, including, without limitation,
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country; (b) all reissues, continuations,
continuations-in-part or extensions thereof; (c) all petty patents, divisionals,
and patents of addition; and (d) all patents to be issued under any such
applications.

"Permitted Liens" means any and all of the following: (i) Liens in favor of
Lender; (ii) Liens for taxes, fees, assessments or other governmental charges or
levies, either not delinquent or being contested in good faith by appropriate
proceedings; provided, that such Liens do not have priority (or are being so
contested and any Grantor has bonded against such liens in full) over any of
Lender's Liens and any Grantor maintains adequate reserves therefor in
accordance with GAAP; (iii) Liens securing claims or demands of materialmen,
artisans, mechanics, carriers, warehousemen, landlords and other like Persons
arising in the ordinary course of any Grantor's business and imposed without
action of such parties; provided, that the payment thereof is not yet required;
(iv) Liens arising from judgments, decrees or attachments in circumstances which
do not constitute an Event of Default hereunder; (v) the following deposits, to
the extent made in the ordinary course of business: deposits under worker's
compensation, unemployment insurance, social security and other similar laws, or
to secure the performance of bids, tenders or contracts (other than for the
repayment of borrowed money) or to secure indemnity, performance or other
similar bonds for the performance of bids, tenders or contracts (other than for
the repayment of borrowed money) or to secure statutory obligations (other than
liens arising under ERISA or environmental liens) or surety or appeal bonds, or
to secure indemnity, performance or other similar bonds; and (vi) Liens on
insurance proceeds in favor of insurance companies granted solely as security
for financed premiums.

"Person" means any individual, sole proprietorship, partnership, joint venture,
trust, unincorporated organization, association, corporation, limited liability
company, institution, public benefit corporation, other entity or government
(whether federal, state, county, city, municipal, local, foreign, or otherwise,
including any instrumentality, division, agency, body or department thereof).

                                      A-4
<PAGE>

"Proceeds" means "proceeds," as such term is defined in the UCC and, in any
event, shall include, without limitation, (a) any and all Accounts, Chattel
Paper, Instruments, Cash, proceeds of letters of credit, Letter of Credit
Rights, Supporting Obligations, or other proceeds payable to any Grantor from
time to time in respect of the Collateral, (b) any and all proceeds of any
insurance, indemnity, warranty or guaranty payable to any Grantor from time to
time with respect to any of the Collateral, (c) any and all payments (in any
form whatsoever) made or due and payable to any Grantor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental authority
(or any Person acting under color of governmental authority), (d) the proceeds,
damages, or recovery based on any claim of any Grantor against third parties (i)
for past, present or future infringement of any Copyright, Copyright License,
Patent or Patent License or (ii) for past, present or future infringement or
dilution of any Trademark or Trademark License or for injury to the goodwill
associated with any Trademark, Trademark registration or Trademark licensed
under any Trademark License, and (e) any and all other amounts from time to time
paid or payable under or in connection with any of the Collateral.

"Receivables" " means (i) all of any Grantor's Accounts, Instruments, Documents,
Chattel Paper, Supporting Obligations, letters of credit, proceeds of any letter
of credit, and Letter of Credit Rights, and (ii) all customer lists, software,
and business records related thereto.

"Lender" shall have the meaning assigned thereto in the preamble to the
Agreement.

"Supporting Obligations" means any "supporting obligations," as such term is
defined in the UCC, now owned or hereafter acquired by any Grantor or in which
any Grantor now holds or hereafter acquires any interest.

"Trademark License" means any written agreement granting any right to use any
Trademark or Trademark registration, now owned or hereafter acquired by any
Grantor or in which any Grantor now holds or hereafter acquires any interest.

"Trademarks" means all of the following property, now owned or hereafter
acquired by any Grantor or in which any Grantor now holds or hereafter acquires
any interest: (a) all trademarks, trade names, corporate names, business names,
trade styles, service marks, logos, other source or business identifiers (and
all goodwill associated therewith), prints and labels on which any of the
foregoing have appeared or appear, and designs of like nature, now existing or
hereafter adopted or acquired, all registrations and recordings thereof, and any
applications in connection therewith, including, without limitation,
registrations, recordings and applications in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country or any political subdivision thereof, and (b)
all reissues, extensions or renewals thereof.

"UCC" means the Uniform Commercial Code as the same is, from time to time, in
effect in the State of Illinois; provided, that in the event that, by reason of
mandatory provisions of law, any or all of the attachment, perfection or
priority of, or remedies with respect to, Secured Party's Lien on any Collateral
is governed by the Uniform Commercial Code as the same is, from time to time, in
effect in a jurisdiction other than the State of Illinois, then the term "UCC"

                                      A-5
<PAGE>

shall mean the Uniform Commercial Code as in effect, from time to time, in such
other jurisdiction solely for purposes of the provisions thereof relating to
such attachment, perfection, priority or remedies and for purposes of
definitions related to such provisions. Unless otherwise defined herein, terms
that are defined in the UCC and used herein shall have the meanings given to
them in the UCC.

                                      A-6
<PAGE>

                                    EXHIBIT B
                                       TO
                               SECURITY AGREEMENT

               GRANTORS' DEPOSIT ACCOUNTS AND INVESTMENT ACCOUNTS

DEPOSIT ACCOUNTS:

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Institution      Description      Name of Account   Number    Bank Contact
-----------      -----------      ---------------   ------    ------------
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

INVESTMENT ACCOUNTS:

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Institution   Description   Name of Account    Number     Bank Contact
-----------   -----------   ---------------    ------     ------------
-------------------------------------------------------------------------------

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                                      B-1
<PAGE>

                                    EXHIBIT C
                                       TO
                               SECURITY AGREEMENT

               NAME, LOCATIONS, AND OTHER INFORMATION FOR GRANTORS

1.    Grantor's current name and organizational status:

      Name:

      Type of organization:

      State of organization:

      Organization file number:

2.    For five (5) years prior hereto, Grantor did not do business under any
      other name or organization or form except the following:

      Name and Dates:

3.    Grantor's fiscal year ends on:

4.    Grantor's federal employer tax identification number is:

5.    The street addresses, cities, states and postal codes of Grantor's current
      locations as of the date hereof are:

      Chief Executive Office:

      Principal Place of Business:

      Locations of Collateral:

                                      C-1
<PAGE>

                                    EXHIBIT D
                                       TO
                               SECURITY AGREEMENT

             GRANTORS' PATENTS, TRADEMARKS, COPYRIGHTS AND LICENSES

I.    PATENTS

-------------------------------------------------------------------------------
PATENTS
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
         Patent Name         Status and Date Issued          Patent Number
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
PATENT APPLICATIONS
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
         Name              Status and Date Filed      Application Number
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
PATENT LICENSES
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
         Name            Licensor       Licensee             Patent Number
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

II.   TRADEMARKS

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TRADEMARKS
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
         Name           Date Filed or Issued       Serial Number      Status
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
TRADEMARK APPLICATIONS
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
         Name               Date Filed         Serial Number        Status
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
TRADEMARK LICENSES
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
        Name             Licensor              Licensee             Number
-------------------------------------------------------------------------------

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                                      D-1
<PAGE>

III.  COPYRIGHTS

-------------------------------------------------------------------------------
COPYRIGHT REGISTRATIONS
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
    Registration No.        Title         Registration Date        V & A No.
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
APPLICATIONS FOR COPYRIGHT REGISTRATION
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
        Title                   Date Filed                     V & A No.
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
COPYRIGHT LICENSES
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
       Licensor              Licensee               Title            V & A No.
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

                                      D-2
<PAGE>

                                    EXHIBIT E
                                       TO
                               SECURITY AGREEMENT

                 GRANTORS' SUBSIDIARIES, PARENTS AND AFFILIATES

      I.    Subsidiaries

      II.   Parents

      III.  Affiliates

o                                       E-1Exhibit 10.8

                              EMPLOYMENT AGREEMENT

      This Employment Agreement is made and entered into by and between VoIP,
Inc. (the "Company") and Shawn Lewis ("Executive") as of May 27, 2005 (the
"Effective Date").

1. Position and Duties: Executive shall be employed by the Company as its Chief
Technology Officer ("CTO"), reporting only to the Company's Chief Executive
Officer (the "CEO") and Board of Directors or other designated Company Officer
as directed by the CEO if mutually acceptable to Executive. As its CTO,
Executive agrees to devote his full business time, energy and skill to his
duties at the Company, except for vacation time and absence for sickness or
similar disability. These duties shall include all those duties customarily
performed by the CTO. During the term of Executive's employment, Executive shall
be permitted to serve on boards of directors of for-profit or not-for-profit
entities provided such service does not adversely affect the performance of
Executive's duties to the Company under this Agreement.

      In addition, Executive shall be entitled to one Board Seat on the
Company's Board. Executive, or his designee shall be elected to the Board at the
next shareholder meeting of the Company, which shall be held within 20 days of
the date hereof. As a member of the Company's Board, designee shall continue to
be subject to the provisions of the Company's bylaws and all applicable general
corporation laws relative to his position on the Board. In addition to the
Company's bylaws, as a member of the Board, Executive, or his designee shall
also be subject to the statement of powers, both specific and general, set forth
in the Company's Articles of Incorporation.

      Executive will be responsible for the management, direction, and ongoing
development of all software and technical development efforts for the Company.
The current development efforts term "CNI", shall be a continuing, and required
component of the Executive's role and Company's commitment to Executive.

2. Term of Employment: This Agreement shall remain in effect for a period of two
years from the Effective Date, and thereafter will automatically renew for
successive one year periods unless either party provides ninety days' prior
notice of termination. In the event the Company elects to terminate the
Agreement, such termination shall be considered to be an Involuntary
Termination, and Executive shall be provided benefits as provided in this
Agreement. Upon the termination of Executive's employment for any reason,
neither Executive nor Company shall have any further obligation or liability
under this Agreement to the other, except as set forth below.

3. Compensation: Executive shall be compensated by the Company for his services
as follows:

      (a) Base Salary: As CTO, Executive shall be paid a monthly Base Salary of
$16,666.67 per month ($200,000 on an annualized basis), subject to applicable
withholding, in accordance with the Company's normal payroll procedures.
Executive's salary shall be reviewed on at least an annual basis and may be
adjusted as appropriate, but in no event shall it be less. In the event of such
an adjustment, that amount shall become Executive's Base Salary. Furthermore,
during the term of this Agreement, in no event shall Executive's compensation be

<PAGE>

less than any other officer or employee of the Company or any subsidiary, other
than the Chief Executive Officer

      (b) Benefits: Executive shall have the right, on the same basis as other
senior executives of the Company, to participate in and to receive benefits
under any of the Company's employee benefit plans, as such plans may be modified
from time to time, and provided that in no event shall Executive receive less
than (4) four weeks paid vacation per annum and (6) six paid sick/five paid
personal days per annum. Consecutive weeks must be approved by the CEO.
Executive may take up to 2 weeks vacation after 60 days from merger closing.

      (c) Performance Bonus: Executive shall have the opportunity to earn a
performance bonus in accordance with the Company's Performance Bonus Plan; as
such plan may be modified over time. Pursuant to the Performance Bonus Plan,
Executive will have a target bonus for meeting established objective performance
objectives. The Bonus shall consist of performance-based stock options which and
shall be included in the Company's Employee Stock Option Plan. In the event the
performance criteria and formal Bonus Plan is not established within 90 days the
Company will pay a $15,000.00 cash bonus per quarter until the Performance Bonus
Plan is in place.

      (d) Signing Bonus: Executive shall receive upon the close of Company's
equity funding but not later than three (3) weeks from the merger closing a
$40,000.00 signing bonus. In addition, pursuant to the merger agreement,
Executive will receive 350,000 VOII shares in exchange for his 1,000,000 Caerus
options.

      (e) Credited Time: For the purpose of computing vacation, personal, sick,
and other time as generally available, Executive shall be treated as earned
since January 1, 2005.

      (f) Expenses: Company shall reimburse Executive for reasonable travel,
lodging, entertainment and meal expenses incurred in connection the performance
of services within this Agreement. In addition, as customary for this position,
additional expenses related to the performance, and analysis, or use of such
technology as to promote, or enhance, or provide for the research required in
satisfying the requirements of Executive's position shall also be reimbursed.

      (g) Travel: Executive shall not be required to travel more than 5 days per
month.

      (h) Home Office: Executive shall be reimbursed for expenses associated
with maintaining a home office. (Bandwidth, VPN, etc)

4.    Effect of Termination of Employment:

      (a) Voluntary Termination, Death or Disability: In the event of
Executive's voluntary termination from employment with the Company, Executive
shall be entitled to no compensation or benefits from the Company other than
those earned under Section 3 through the date of his termination and, in the
case of each stock option, restricted stock award or other Company stock-based
award granted to Executive, the extent to which such awards are vested through
the date of his termination. In the event that Executive's employment terminates
as a result of his death or disability, Executive shall be entitled to a

                                       2
<PAGE>

pro-rata share of the Target Bonus (presuming performance meeting, but not
exceeding, target performance goals) in addition to all compensation and
benefits earned under Section 3 through the date of termination.

      (b) Termination for Cause: If Executive's employment is terminated by the
Company for Cause, Executive shall be entitled to no compensation or benefits
from the Company other than those earned under Section 3 through the date of his
termination and, in the case of each stock option, restricted stock award or
other Company stock-based award granted to Executive, the extent to which such
awards are vested through the date of his termination. In the event that the
Company terminates Executive's employment for Cause, the Company shall provide
written notice to Executive of that fact prior to, or concurrently with, the
termination of employment. Failure to provide written notice that the Company
contends that the termination is for Cause shall constitute a waiver of any
contention that the termination was for Cause, and the termination shall be
irrebuttably presumed to be an Involuntary Termination.

      (c) Involuntary Termination During Change in Control Period: If
Executive's employment with the Company terminates as a result of a Change in
Control Period Involuntary Termination, then, in addition to any other benefits
described in this Agreement, Executive shall receive the following:

            (i) all compensation and benefits earned under Section 3 through the
      date of Executive's termination of employment;

            (ii) a lump sum payment equivalent to the greater of (a) the bonus
      paid under the Performance Bonus Plan for the year immediately prior to
      the year in which the Change in Control occurred and (b) the Target Bonus
      under the Performance Bonus Plan in effect immediately prior to the year
      in which the Change in Control occurs;

            (iii) a lump sum payment equivalent to one year Base Salary (as it
      was in effect immediately prior to the Change in Control); and

            (iv) reimbursement for the cost of medical, life, disability
      insurance coverage at a level equivalent to that provided by the Company
      for a period expiring upon the earlier of: (a) one year; or (b) the time
      Executive begins alternative employment. It shall be the obligation of
      Executive to inform the Company that new employment has been obtained.

The amount payable to Executive under subsections (i) through (iii), above,
shall be paid to Executive in a lump sum within thirty (30) days following
Executive's termination of employment. The amounts payable under subsection (iv)
shall be paid monthly during the reimbursement period.

      (d) Termination Without Cause in the Absence of Change in Control: In the
event that Executive's employment terminates as a result of a Non Change in
Control Period Involuntary Termination, then Executive shall receive the
following benefits:

            (i) all compensation and benefits earned under Section 3 through the
      date of the Executive's termination of employment;

                                       3
<PAGE>

            (ii) a lump sum payment equivalent to the greater of (a) the bonus
      paid under the Performance Bonus Plan for the year immediately prior to
      the year in which the Change in Control occurred and (b) the Target Bonus
      under the Performance Bonus Plan in effect immediately prior to the year
      in which the Change in Control occurs;

            (iii) a lump sum payment equivalent to one year of Base Salary; and

            (iv) reimbursement for the cost of medical, life and disability
      insurance coverage at a level equivalent to that provided by the Company
      for a period of the earlier of: (a) one year; or (b) the time Executive
      begins alternative employment. It shall be the obligation of Executive to
      inform the Company that new employment has been obtained.

The amount payable to Executive under subsections (i) through (iii) above shall
be paid to Executive in a lump sum within thirty (30) days following Executive's
termination of employment. The amounts payable under subsection (iv) shall be
paid monthly during the reimbursement period.

      (e) Resignation with Good Reason During Change in Control Period: If
Executive resigns his employment with the Company as a result of a Change in
Control Period Good Reason, then, in addition to any other benefits described in
this Agreement, Executive shall receive the following.

            (i) all compensation and benefits earned under Section 3 through the
      date of the Executive's termination of employment;

            (ii) a lump sum payment equivalent to the greater of (a) the bonus
      paid under the Performance Bonus Plan for the year immediately prior to
      the year in which the Change in Control occurred and (b) the Target Bonus
      under the Performance Bonus Plan in effect immediately prior to the year
      in which the Change in Control occurs ;

            (iii) a lump sum payment equivalent to one year of Base Salary; and

            (iv) reimbursement for the cost of medical, life and disability
      insurance coverage at a level equivalent to that provided by the Company
      for a period of the earlier of: (a) one year; or (b) the time Executive
      begins alternative employment. It shall be the obligation of Executive to
      inform the Company that new employment has been obtained.

The amount payable to Executive under subsections (i) through (iii) above shall
be paid to Executive in a lump sum within thirty (30) days following the
Executive's termination of employment. The amounts payable under subsection (iv)
shall be paid monthly during the reimbursement period.

      (f) Resignation with Good Reason in the Absence of Change in Control: If
Executive resigns his employment with the Company as a result of a Non Change in
Control Period Good Reason, then, in addition to any other benefits described in
this Agreement, Executive shall receive the following.

                                       4
<PAGE>

            (i) all compensation and benefits earned under Section 3 through the
      date of the Executive's termination of employment;

            (ii) a lump sum payment equivalent to the greater of (a) the bonus
      paid under the Performance Bonus Plan for the year immediately prior to
      the year in which the Change in Control occurred and (b) the Target Bonus
      under the Performance Bonus Plan in effect immediately prior to the year
      in which the Change in Control occurs;

            (iii) a lump sum payment equivalent to one year of Base Salary; and

            (iv) reimbursement for the cost of medical, life and disability
      insurance coverage at a level equivalent to that provided by the Company
      for a period of the earlier of: (a) one year; or (b) the time Executive
      begins alternative employment. It shall be the obligation of Executive to
      inform the Company that new employment has been obtained.

The amount payable to Executive under subsections (i) through (iii) above shall
be paid to Executive in a lump sum within thirty (30) days following the
Executive's termination of employment. The amounts payable under subsection (iv)
shall be paid monthly during the reimbursement period.

      (g) Resignation from Positions: In the event that Executive's employment
with the Company is terminated for any reason, on the effective date of the
termination Executive shall simultaneously resign from each position he holds on
the Board and/or the Board of Directors of any of the Company's affiliated
entities and any position Executive holds as an officer of the Company or any of
the Company's affiliated entities.

5. Certain Definitions: For the purpose of this Agreement, the following
capitalized terms shall have the meanings set forth below:

      (a) "Cause" shall mean any of the following occurring on or after the date
of this Agreement :

            (i) Executive's theft, dishonesty, breach of fiduciary duty for
      personal profit, or falsification of any employment or Company record;

            (ii) Executive's willful violation of any law, rule, or regulation
      (other than traffic violations or similar offenses) or final
      cease-and-desist order, in each case that involves moral turpitude;

            (iii) Executive's intentional failure to perform stated duties,
      provided Executive has not cured such failure following 20 days prior
      written notice of such failure;

            (iv) Executive's improper disclosure of the Company's confidential
      or proprietary information;

            (v) any material breach by Executive of the Company's Code of
      Professional Conduct, which breach shall be deemed "material" if it

                                       5
<PAGE>

      results from an intentional act by Executive and has a material
      detrimental effect on the Company's reputation or business; or

            (vi) any material breach by Executive of this Agreement, which
      breach, if curable, is not cured within thirty (30) days following written
      notice of such breach from the Company.

      (b) "Change in Control" shall mean the occurrence of any of the following
events:

            (i) (X) any "person" (as such term is used in Section 13 (d) and 14
      (d) of the Securities Exchange Act of 1934, as amended) (other than
      Executive or Stephen Ivester) becomes the "beneficial owner" (as defined
      in Rule 13d-3 under said Act), directly or indirectly, of securities of
      the Company representing more than fifty percent (50%) of the total
      combined voting power represented by the Company's then outstanding voting
      securities other than the acquisition of the Company's Common Stock by a
      Company-sponsored employee benefit plan or through the issuance of shares
      sold directly by the Company to a single acquirer, or (Y) any "person" (as
      such term is used in Section 13 (d) and 14 (d) of the Securities Exchange
      Act of 1934, as amended) becomes the "beneficial owner" (as defined in
      Rule 13d-3 under said Act) directly or indirectly, of securities of the
      Company representing less than fifty percent (50%) of the total combined
      voting power represented by the Company's then outstanding voting
      securities, but in connection with the person's acquisition of securities
      the person acquires the right to terminate the employment of all or a
      portion of the Company's management team;

            (ii) the Company is party to a merger or consolidation which results
      in the holders of the voting securities of the Company outstanding
      immediately prior thereto failing to retain immediately after such merger
      or consolidation direct or indirect beneficial ownership of more than
      fifty percent (50%) of the total combined voting power of the securities
      entitled to vote generally in the election of directors of the Company or
      the surviving entity outstanding immediately after such merger of
      consolidation.

            (iii) a change in the composition of the Board occurring within a
      period of twenty-four (24) consecutive months, as a result of which fewer
      than a majority of the directors are Incumbent Directors;

            (iv) effectiveness of an agreement for the sale, lease or
      disposition by the Company of all or substantially all of the Company's
      assets; or

            (v) a liquidation or dissolution of the Company.

      (c) "Change in Control Period" shall mean the period commencing on the
date sixty (60) days prior to the date of consummation of the Change of Control
and ending sixty (60) days following of same date of consummation of the Change
of Control..

      (d) "Change in Control Period Good Reason" shall mean Executive's
resignation for any of the following conditions, first occurring during a Change
in Control Period and occurring without Executive's written consent:

                                       6
<PAGE>

            (i) a decrease in Executive's Base Salary and/or a decrease in
      Executive's Target Bonus (as a multiple of Executive's Base Salary) under
      the Performance Bonus Plan or employee benefits other than as part of any
      across-the-board reduction applying to all senior executives and not
      resulting in those senior executives receiving lesser benefits than
      similarly situated executives of an acquirer;

            (ii) a material, adverse change in Executive's title, authority,
      responsibilities, as measured against Executive's title, authority,
      responsibilities or duties immediately prior to such change.

            (iii) the relocation of Executive's principal workplace to a
      location greater than thirty (30) miles from the prior workplace;

            (iv) any material breach by the Company of any provision of this
      Agreement, which breach is not cured within thirty (30) days following
      written notice of such breach from Executive;

            (v) any failure of the Company to obtain the assumption of this
      Agreement by any of the Company's successors or assigns by purchase,
      merger, consolidation, sale of assets or otherwise.

            (vi) any purported termination of Executive's employment for
      "material breach of contract" which is purportedly effected without
      providing the "cure" period, if applicable, described in Section 6 (a)
      (iii) or (vi), above.

            (vii) any reduction, or attempt to cease any of the development
      efforts of the CNI platform unless deemed unprofitable by the Company's
      Board of Directors, not to be determined during the first year of
      executives employment.

The effective date of any Change in Control Period Involuntary Termination shall
be the date of notification to the Executive of the termination of employment by
the Company or the date of notification to the Company of the resignation from
employment by the Executive for Change in Control Period Good Reason.

      (e) "Non Change in Control Period Good Reason" shall mean the Executive's
resignation within six months of any of the following conditions first occurring
outside of a Change in Control Period and occurring without Executive's written
consent:

            (i) a decrease in Executive's total cash compensation opportunity
      (adding Base Salary and Target Bonus) of greater than ten percent (10%);

            (ii) a material, adverse change in Executive's title, authority,
      responsibilities or duties, as measured against Executive's title,
      authority, responsibilities or duties immediately prior to such change;

            (iii) any material breach by the Company of a provision of this
      Agreement, which breach is not cured within thirty (30) days following
      written notice of such breach from Executive;

                                       7
<PAGE>

            (iv) the relocation of Executive's principal workplace to a location
      greater than thirty (30) miles from the prior workplace;

            (v) any purported termination of Executive's employment for
      "material breach of contract" which is purportedly effected without
      providing the "cure" period, if applicable, described in Section 6 (a)
      (iii) or (vi), above.

            (vi) any reduction, or attempt to cease any of the development
      efforts of the CNI platform unless deemed unprofitable by the Company's
      Board of Directors, not to be determined during the first year of
      executives employment.

The effective date of any Non Change in Control Period Involuntary Termination
shall be the date of notification to the Executive of the termination of
employment by the Company or the date of notification to the Company of the
resignation from employment by the Executive for Non Change in Control Period
Good Reason.

      (f) "Incumbent Directors" shall mean members of the Board who either (a)
are members of the Board as of the date hereof, or (b) are elected, or nominated
for election, to the Board with the affirmative vote of at least a majority of
the Incumbent Directors at the time of such election or nomination (but shall
not include an individual whose election or nomination is in connection with an
actual or threatened proxy contest relating to the election of members of the
Board).

      (g) "Change in Control Period Involuntary Termination" shall mean during a
Change in Control Period the termination by the Company of Executive's
employment with the Company for any reason other than Cause, Executive's death
or Executive's Disability; or

      (h) "Non Change in Control Period Involuntary Termination" shall mean
outside a Change in Control Period the termination by the Company of Executive's
employment with the Company for any reason other than Cause, Executive's death
or Executive's disability.

6. Dispute Resolution: In the event of any dispute or claim relating to or
arising out of this Agreement (including, but not limited to, any claims of
breach of contract, wrongful termination or age, sex, race or other
discrimination), Executive and the Company agree that all such disputes shall be
fully addressed and finally resolved by (1) binding arbitration conducted by the
American Arbitration Association in Broward County, in the State of Florida in
accordance with its National Employment Dispute Resolution rules or (2) in any
federal or state court located in Seminole County, Florida. In connection with
any such arbitration, the Company shall bear all costs not otherwise born by a
plaintiff in a court proceeding.

7. Attorneys' Fees: The prevailing party shall be entitled to recover from the
losing party its attorneys' fees and costs incurred in any action brought to
enforce any right arising out of this Agreement.

8. Restrictive Covenants:

      (a) Nondisclosure. During the Term and following termination of the
Executive's employment with the Company, Executive shall not divulge,

                                       8
<PAGE>

communicate, use to the detriment of the Company or for the benefit of any other
person or persons, or misuse in any way, any Confidential Information (as
hereinafter defined) pertaining to the business of the Company. Any Confidential
Information or data now or hereafter acquired by the Executive with respect to
the business of the Company (which shall include, but not be limited to,
confidential information concerning the Company's financial condition,
prospects, technology, customers, suppliers, methods of doing business and
promotion of the Company's products and services) shall be deemed a valuable,
special and unique asset of the Company that is received by the Executive in
confidence and as a fiduciary. For purposes of this Agreement "Confidential
Information" means information disclosed to the Executive or known by the
Executive as a consequence of or through his employment by the Company
(including information conceived, originated, discovered or developed by the
Executive) prior to or after the date hereof and not generally known or in the
public domain, about the Company or its business. Notwithstanding the foregoing,
nothing herein shall be deemed to restrict the Executive from disclosing
Confidential Information to the extent required by law or by any court.

      (b) Non-Competition. The Executive shall not, while employed by the
Company and for a period of one year following the Date of Termination for
Cause, or Resignation without Good Reason, engage or participate, directly or
indirectly (whether as an officer, director, employee, partner, consultant, or
otherwise), in any business that manufactures, markets or sells products that
directly competes with any product of the Company that is significant to the
Company's business based on sales and/or profitability of any such product as of
the date of termination of Executive's employment with the Company. Nothing
herein shall prohibit Executive from being a passive owner of less than 5 %
stock of any entity directly engaged in a competing business.

      (c) Property Rights; Assignment of Inventions. With respect to
information, inventions and discoveries or any interest in any copyright and/or
other property right developed, made or conceived of by Executive, either alone
or with others, during his employment by Employer arising out of such employment
or pertinent to any field of business or research in which, during such
employment, Employer is engaged or (if such is known to or ascertainable by
Executive) is considering engaging, Executive hereby agrees:

            (i) that all such information, inventions and discoveries or any
      interest in any copyright and/or other property right, whether or not
      patented or patentable, shall be and remain the exclusive property of the
      Employer;

            (ii) to disclose promptly to an authorized representative of
      Employer all such information, inventions and discoveries or any copyright
      and/or other property right and all information in Executive's possession
      as to possible applications and uses thereof;

            (iii) not to file any patent application relating to any such
      invention or discovery except with the prior written consent of an
      authorized officer of Employer (other than Executive);

            (iv) that Executive hereby waives and releases any and all rights
      Executive may have in and to such information, inventions and discoveries,
      and hereby assigns to Executive and/or its nominees all of Executive's

                                       9
<PAGE>

      right, title and interest in them, and all Executive's right, title and
      interest in any patent, patent application, copyright or other property
      right based thereon. Executive hereby irrevocably designates and appoints
      the Company and each of its duly authorized officers and agents as his
      agent and attorney-in-fact to act for him and on his behalf and in his
      stead to execute and file any document and to do all other lawfully
      permitted acts to further the prosecution, issuance and enforcement of any
      such patent, patent application, copyright or other property right with
      the same force and effect as if executed and delivered by Executive; and

            (v) at the request of the Company, and without expense to Executive,
      to execute such documents and perform such other acts as Employer deems
      necessary or appropriate, for Employer to obtain patents on such
      inventions in a jurisdiction or jurisdictions designated by Employer, and
      to assign to Employer or its designee such inventions and any and all
      patent applications and patents relating thereto.

9. General:

      (a) Successors and Assigns: The provisions of this Agreement shall inure
to the benefit of and be binding upon the Company, Executive and each and all of
their respective heirs, legal representatives, successors and assigns. The
duties, responsibilities and obligations of Executive under this Agreement shall
be personal and not assignable or delegable by Executive in any manner
whatsoever to any person, corporation, partnership, firm, company, joint venture
or other entity. Executive may not assign, transfer, convey, mortgage, pledge or
in any other manner encumber the compensation or other benefits to be received
by him or any rights which he may have pursuant to the terms and provisions of
this Agreement.

      (b) Amendments; Waivers: No provision of this Agreement shall be modified,
waived or discharged unless the modification, waiver or discharge is agreed to
in writing and signed by Executive and by an authorized officer of the Company.
No waiver by either party of any breach of, or of compliance with, any condition
or provision of this Agreement by the other party shall be considered a waiver
of any other condition or provision or of the same condition or provision at
another time.

      (c) Notices: Any notices to be given pursuant to this Agreement by either
party may be effected by personal delivery or by overnight delivery with receipt
requested. Mailed notices shall be addressed to the parties at the addresses
stated below, but each party may change its or his/her address by written notice
to the other in accordance with this subsection (c).Mailed notices to Executive
shall be addressed as follows:

      Nicholas A. Iannuzzi, Jr.
      20 William Street, Suite 245
      Wellesely, MA 02481

      with a copy to

      Shawn M. Lewis
      1788 Redwood Grove Terrace
      Lake Mary, FL 32746

                                       10
<PAGE>

      Mailed notices to the Company shall be addressed as follows:

      Steven Ivester
      VoIP, Inc.
      12330 SW 53rd Street, Suite 712
      Cooper City, Florida  33330

      (d) Entire Agreement: This Agreement constitutes the entire employment
agreement between Executive and the Company regarding the terms and conditions
of his employment, with the exception of (a) the agreement described in Section
7 and (b) any stock option, restricted stock or other Company stock-based award
agreements between Executive and the Company to the extent not modified by this
Agreement. This Agreement (including the documents described in (a) and (b)
herein) supersedes all prior negotiations, representations or agreements between
Executive and the Company, whether written or oral, concerning Executive's
employment by the Company.

      (e) Withholding Taxes: All payments made under this Agreement shall be
subject to reduction to reflect taxes required to be withheld by law.

      (f) Counterparts: This Agreement may be executed by the Company and
Executive in counterparts, each of which shall be deemed an original and which
together shall constitute one instrument.

      (g) Headings: Each and all of the headings contained in this Agreement are
for reference purposes only and shall not in any manner whatsoever affect the
construction or interpretation of this Agreement or be deemed a part of this
Agreement for any purpose whatsoever.

      (h) Savings Provision: To the extent that any provision of this Agreement
or any paragraph, term, provision, sentence, phrase, clause or word of this
Agreement shall be found to be illegal or unenforceable for any reason, such
paragraph, term, provision, sentence, phrase, clause or word shall be modified
or deleted in such a manner as to make this Agreement, as so modified, legal and
enforceable under applicable laws. The remainder of this Agreement shall
continue in full force and effect.

      (i) Construction: The language of this Agreement and of each and every
paragraph, term and provision of this Agreement shall, in all cases, for any and
all purposes, and in any and all circumstances whatsoever be construed as a
whole, according to its fair meaning, not strictly for or against Executive or
the Company, and with no regard whatsoever to the identity or status of any
person or persons who drafted all or any portion of this Agreement.

      (j) Further Assurances: From time to time, at the Company's request and
without further consideration, Executive shall execute and deliver such
additional documents and take all such further action as reasonably requested by

                                       11
<PAGE>

the Company to be necessary or desirable to make effective, in the most
expeditious manner possible, the terms of this Agreement and to provide adequate
assurance of Executive's due performance hereunder.

      (k) Governing Law: Executive and the Company agree that this Agreement
shall be interpreted in accordance with and governed by the laws of the State of
Florida.

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

  /s/ Shawn M. Lewis                         /s/ Steven Ivester
----------------------                     ------------------------
By:  Shawn M. Lewis                        By:  Steven Ivester, CEO

  May 31, 2005                               May 31, 2005
----------------------                     ------------------
Date:                                      Date:

                                       12

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