FUSION TELECOMMUNICATIONS INTERNATIONAL INC (Form: 8-K, Received: 01/29/2018 07:06:43)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) January 24, 2018

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

(Exact name of registrant as specified in its charter)

Delaware	001-32421	58-2342021
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

420 Lexington Avenue, Suite 1718, New York, NY	10170
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code:

(212) 201-2400

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01

Entry into a Material Definitive Agreement.

On January 24, 2018, Fusion Telecommunications International, Inc., a Delaware corporation (“ Fusion ”), entered into a Fourth Amendment (the “ Fourth Amendment ”) to the Agreement and Plan of Merger (the “ Merger Agreement ”), dated August 26, 2017, by and between Fusion, Fusion BCHI Acquisition LLC (“ BCHI ”) and Birch Communications Holdings, Inc. (“ Birch ”). The Fourth Amendment further extended the date by which either Fusion or Birch may terminate the Merger Agreement due to an inability to secure commitments for the required financing from 120 days from the date of the Merger Agreement to 220 days from the date thereof (i.e., April 3, 2018). Under the Fourth Amendment, the parties also agreed to exclude up to 300,000 shares of common stock of Fusion (the “ Common Stock ”) to be issued in connection with the IQmax Asset Acquisition (as defined below) from the calculation of the number of shares to be issued to BCHI Holding, LLC at the closing under the Merger Agreement, as consideration in connection therewith. In addition, the Fourth Amendment also revised Exhibit D to the Merger Agreement (which exhibit described the proposed spin-off of the Birch consumer business required as a condition precedent to closing) to exclude references to the Canadian business of Birch as the parties have agreed that such assets and customers will transfer to Fusion at closing.

On January 25, 2018 , Fusion, BCHI and Birch entered into a Fifth Amendment (the “ Fifth Amendment ”) to the Merger Agreement. Under the Fifth Amendment, the parties agreed to increase the dollar amount of cash that Fusion could raise by issuing equity or debt securities in connection with capital raising activities prior to the closing of the Merger from $10.0 million to $40.0 million (net proceeds) and also agreed any shares of Common Stock issued by Fusion in such an offering in amount of up to such $40.0 million (net proceeds) would be excluded in determining the number of shares to be issued to BCHI Holding, LLC at the closing under the Merger Agreement as consideration in connection therewith.

On January 26, 2018, Fusion obtained a waiver (the “ East West Waiver ”) from the lenders under its senior secured credit facility with East West Bank, as administrative agent, and the other lenders parties thereto (the “ Credit Facility ”), that permits Fusion to sell up to approximately $30,000,000 (net proceeds) of Common Stock without having to use any of those proceeds to prepay amounts outstanding under the Credit Facility. Prior to receiving this waiver, Fusion was obligated under the Credit Facility to use any net proceeds from any sale of its equity securities that are in excess of $4.0 million to pay down outstanding borrowings thereunder.

The foregoing description of the Fourth Amendment, the Fifth Amendment, and the East West Waiver are not complete and are qualified in their entirety by reference to the full text of each such document, all of which are filed hereto as Exhibits 10.1, 10.2, and 10.3, and which are incorporated by reference herein in their entirety.

Item 2.02.

Results of Operations and Financial Condition

In connection with the Offering (defined below), Fusion is filing a preliminary prospectus supplement dated January 29, 2018 that includes current and preliminary expectations of financial results for Fusion and Birch for the fourth quarter ended December 31, 2017. Such financial results are furnished under the heading “Prospectus Supplement Summary – Recent Developments – Preliminary Fourth Quarter 2017 Financial Results” and are set forth in their entirety below.

Preliminary Fourth Quarter 2017 Financial Results

The following information reflects our current and preliminary expectations of financial results for Fusion and Birch for the fourth quarter ended December 31, 2017. These numbers remain subject to adjustment in connection with the pending audit of our financial statement and those of Birch.

For the fourth quarter of 2017, we estimate that our revenues overall and attributable to our Business Services segment will be approximately $40.2 million and $29.5 million, respectively. For the fourth quarter of 2017, we estimate that our net loss overall will be in the range of $3.6 million to $3.2 million, and our adjusted EBITDA overall will be in the range of $3.9 million to $4.3 million. Please note, however, that we have yet to calculate the extent of our derivative warrant liability or income tax liability for 2017, both of which could have a significant effect on our net losses, but neither of which will have an effect on our adjusted EBITDA. A reconciliation of net (loss) income to adjusted EBITDA for Fusion is set forth below.

We have been advised by Birch that it estimates that for the fourth quarter of 2017, business segment revenue of its North America (U.S. and Canada) nonconsumer business will be approximately $106 million. We have further been advised by Birch that it estimates that, for the fourth quarter of 2017, net loss for this business segment will be in the range of $2.3 million to $0.4 million, and adjusted EBITDA for this business segment will be in the range of $31 million to $33 million. The adjusted EBITDA for Birch consists of gross margin (i.e., total revenue less cost of goods sold) less selling, general and administrative expenses, restructuring charges, transaction charges and certain onetime legal charges. A reconciliation of net (loss) income to adjusted EBITDA for Birch is set forth below.

Fusion Telecommunications International, Inc.

Adjusted EBITDA Unaudited Reconciliation

	For the Three Months Ended December 31,2017 (in millions)

Net (loss) income	$ (3.6 ) – (3.2)
Interest expense and other financing costs	2.2
Provision (benefit) for income taxes	-
Depreciation and amortization	3.6
EBITDA	2.6
Acquisition and transaction expenses	0.7
Change in fair value of derivative liability	-
(Gain)/Loss on disposal of property and equipment, extinguishment of debt, impairment	(0.7 )
Stock based compensation expense	1.7
Adjusted EBITDA	$ 3.9 – 4.3

Birch Communications Holdings, Inc.

Adjusted EBITDA Unaudited Reconciliation

	For the Three Months Ended December 31,2017 (in millions)

Net (loss) income	$ (2.3 ) – (0.4)
Interest expense	12.6
Provision for income taxes	0.3
Depreciation and amortization	18.6
Foreign Currency Loss	0.1
Other Income	1.2
EBITDA	28.0 – 30.0
Acquisition and Transaction Expenses	1.5
Non-Recurring Employment Related Expenses	1.0
Legal Settlements	0.5
Adjusted EBITDA	$ 31.0 – 33.0

The Company believes that EBITDA (earnings before interest, taxes, depreciation and amortization) is useful to investors because it is commonly used in the cloud communications industry to evaluate companies on the basis of operating performance and leverage. Adjusted EBITDA provides an adjusted view of EBITDA that takes into account certain significant nonrecurring transactions, if any, such as impairment losses and expenses associated with pending acquisitions, which vary significantly between periods and are not recurring in nature, as well as certain recurring noncash charges such as changes in fair value of the Company’s derivative liabilities and stockbased compensation. The Company also believes that Adjusted EBITDA provides investors with a measure of the Company’s operational and financial progress that corresponds with the measurements used by management as a basis for allocating resources and making other operating decisions. Although the Company uses Adjusted EBITDA as one of several financial measures to assess its operating performance, its use is limited as it excludes certain significant operating expenses. EBITDA and Adjusted EBITDA are not intended to represent cash flows for the periods presented, nor have they been presented as an alternative to operating income or as an indicator of operating performance and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In accordance with SEC Regulation G, the nonGAAP measurements in this presentation have been reconciled to the nearest GAAP measurement.

Note Regarding Preliminary Results . The preliminary financial results presented above are subject to the completion of our and Birch’s financial closing procedures, which have not yet been completed. Our and Birch’s actual results for the fourth quarter will not be available until after this offering is completed and may differ materially from these estimates. Therefore, you should not place undue reliance upon these preliminary financial results. For instance, during the course of the preparation of the respective financial statements and related notes, additional items that would require material adjustments to be made to the preliminary estimated financial results presented above may be identified. The preliminary financial data included in this prospectus supplement relating to Fusion has been prepared by and is the responsibility of our management, and the preliminary financial data included in this prospectus supplement relating to Birch was provided to us by Birch’s management. Neither EisnerAmper LLP, Fusion’s independent registered public accounting firm, nor McNair, McLemore, Middlebrooks & Co., LLC, Birch’s independent public accounting firm, has audited, reviewed, compiled or performed any procedures with respect to the preliminary financial data set forth above. Accordingly, neither EisnerAmper LLP nor McNair, McLemore, Middlebrooks & Co., LLC expresses an opinion or any other form of assurance with respect to these financial figures. The preliminary estimated financial results were not prepared with the view to complying with published guidelines of the SEC or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of preliminary estimated results of operations.

Item 8.01

Other Events

On January 29, 2018, Fusion issued a press release announcing the launch of its underwritten public offering of Common Stock (the “Offering”). A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the securities described herein, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

On January 8, 2018, Fusion obtained the consent (the “ East West Consent ”) from the lenders under the Credit Facility that permitted Fusion to acquire substantially all of the assets of IQMax, Inc. on January 25, 2018 (the “ IQMax Asset Acquisition ”), for total consideration of $1 million, payable in Common Stock.

On January 8, 2018, Fusion obtained the consent (the “ Praesidian Consent ”) from the lenders under our loan facility with Praesidian Capital Opportunity Fund III, L.P., Praesidian Capital Opportunity Fund III-A, LP and United Insurance Company of America that permitted Fusion to consummate the IQMax Asset Acquisition on January 25, 2018.

The foregoing description of the East West Consent and the Praesidian Consent are not complete and are qualified in their entirety by reference to the full text of each such document, all of which are filed hereto as Exhibits 99.2 and 99.3, respectively, and which are incorporated by reference herein in their entirety.

Item 9.01

Financial Statements and Exhibits.

(d)

Exhibits . EXHIBIT INDEX

Exhibit No.		Description of Exhibit

10.1		Fourth Amendment dated as of January 24, 2018 to Agreement and Plan of Merger by and among Fusion Telecommunications International, Inc., Fusion BCHI Acquisition LLC and Birch Communications Holdings, Inc.

10.2		Fifth Amendment dated as of January 25, 2018 to Agreement and Plan of Merger by and among Fusion Telecommunications International, Inc., Fusion BCHI Acquisition LLC and Birch Communications Holdings, Inc.

10.3		Waiver dated January 26, 2018 to Credit Agreement, dated as of November 14, 2016, as amended, by and among Fusion NBS Acquisition Corp., Fusion Telecommunications International, Inc., Network Billing Systems, L.L.C., Fusion BVX LLC, Pingtone Communications, Inc., Fidelity Telecom, LLC, Fidelity Access Networks, Inc., Fidelity Access Networks, LLC, Fidelity Connect LLC, Fidelity Voice Services, LLC, Apptix, Inc., Fusion BCHI Acquisition LLC, East West Bank, as Administrative Agent, Swingline Lender, an Issuing Bank and a Lender and each other Lender from time to time party to the Credit Agreement.

99.1		Press Release dated January 29, 2018.

99.2		Consent dated January 8, 2018 to Credit Agreement, dated as of November 14, 2016, as amended, by and among Fusion NBS Acquisition Corp., Fusion Telecommunications International, Inc., Network Billing Systems, L.L.C., Fusion BVX LLC, Pingtone Communications, Inc., Fidelity Telecom, LLC, Fidelity Access Networks, Inc., Fidelity Access Networks, LLC, Fidelity Connect LLC, Fidelity Voice Services, LLC, Apptix, Inc., Fusion BCHI Acquisition LLC, East West Bank, as Administrative Agent, Swingline Lender, an Issuing Bank and a Lender and each other Lender from time to time party to the Credit Agreement.

99.3		Consent dated January 8, 2018 to Fifth Amended and Restated Securities Purchase Agreement and Security Agreement, dated as of November 14, 2016, as amended, by and among Fusion NBS Acquisition Corp., Fusion Telecommunications International, Inc., Network Billing Systems, L.L.C., Fusion BVX LLC, Pingtone Communications, Inc., Fidelity Telecom, LLC, Fidelity Access Networks, Inc., Fidelity Access Networks, LLC, Fidelity Connect LLC, Fidelity Voice Services, LLC, Apptix, Inc., Fusion BCHI Acquisition LLC, Praesidian Capital Opportunity Fund III, LP, Praesidian Capital Opportunity Fund III-A, LP, and United Insurance Company of America.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report on Form 8-K to be signed on its behalf by the undersigned thereunto duly authorized.

	FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

	By: /s/ James P. Prenetta, Jr.
	James P. Prenetta, Jr.
January 29, 2018	EVP and General Counsel

Exhibit 10.1

FOURTH AMENDMENT

AGREEMENT AND PLAN OF MERGER

This FOURTH AMENDMENT TO AGREEMENT AND PLAN OF MERGER , dated as of January 24, 2018 (this “ Amendment ”), is entered into by and among Fusion Telecommunications International, Inc., a Delaware corporation (the “ Company ”), Fusion BCHI Acquisition LLC, a Delaware limited liability company (“ Merger Sub ”), and Birch Communications Holdings, Inc., a Georgia corporation (“ BCHI ”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Merger Agreement.

RECITALS

The Parties previously entered into that certain Agreement and Plan of Merger, dated as of August 26, 2017, as amended by the First Amendment to Agreement and Plan of Merger, dated as of September 15, 2017, the Second Amendment to Agreement and Plan of Merger, dated as of September 29, 2017, the Third Amendment to Agreement of Plan of Merger, executed on October 24, 2017, and the Amended and Restated Third Amendment to Agreement and Plan of Merger, dated as of October 27, 2017 (collectively, the “ Merger Agreement ”).

The Parties desire to further amend the Merger Agreement as set forth herein.

The Parties hereby agree as follows:

1. Exhibit A to the Merger Agreement is hereby deleted and replaced with the Exhibit A attached hereto.

2. Section 6.7 of the Merger Agreement is hereby amended by deleting the second sentence thereof and replacing it with the following:

“To the extent necessary to comply with NASDAQ listing requirements, the Company shall submit to the holders of Company Common Stock at the Stockholders’ Meeting a proposal to approve and adopt an amendment to the Company Certificate of Incorporation to authorize the Company Board to effect, prior to the Effective Time, a reverse split of all outstanding shares of Company Common Stock at a ratio of up to 5:1, with such ratio to be determined by the Company Board after consultation with BCHI, such that each holder of shares of Company Common Stock shall receive one share of Company Common Stock for the appropriate number of shares of Company Common Stock held by such holder (the “ Reverse Split ”).”

3. The phrase “120 days after the date hereof” in Section 8.1(b)(iv) of the Merger Agreement is hereby deleted and replaced with “220 days after the date hereof”.

4. The definition of “ Fully-Diluted Company Share Total ” set forth in Section 9.15 , is hereby deleted and replaced with the following:

-1-

“ Fully-Diluted Company Share Total ” means, as of immediately prior to the Effective Time, the number of shares of Company Common Stock issued and outstanding (excluding, for this purpose, the shares of Company Common Stock to be issued by the Company in connection with its acquisition of assets of Iqmax, Inc. (not to exceed 300,000 shares) plus the number of shares of Company Common Stock issued or issuable upon the conversion of the Company Preferred Stock and any other class or series of preferred stock of the Company outstanding as of immediately prior to the Effective Time, plus the number of shares of Company Common Stock issuable upon the exercise of all In-the-Money Company Warrants (as adjusted for stock splits and calculated using the treasury stock method). For the avoidance of doubt, any shares of Company Common Stock that are (a) issued after the date hereof pursuant to Section 5.2 , or (b) issuable upon the conversion of Company Preferred Stock, any other class or series of preferred stock of the Company, or any other security or debt instrument, in each case, issued after the date hereof pursuant to Section 5.2 , will be included in the Fully-Diluted Company Share Total, unless otherwise agreed by the Parties.”

5. Section 2 of Exhibit D to the Merger Agreement is hereby deleted and replaced with the following:

“2. Assets . Prior to the Distribution Time, BCHI and the BCHI Subsidiaries will transfer to a newly created Subsidiary of BCHI or to Tempo Telecom, LLC or another current subsidiary of BCHI approved by the Company (such company being hereinafter referred to as “ Spinco ”) (i) all customer contracts and accounts relating thereto with respect to the then existing consumer business of BCHI and the BCHI Subsidiaries and all customer contracts and accounts relating thereto with respect to their single-line business services business located in the United States (collectively, the “ Consumer/SMB Business Customers ”), (ii) any assets that are used solely to support the Consumer/SMB Business Customers in the United States, and (iii) any other assets that are reasonably agreed by the Parties as necessary to support the services provided to the Consumer/SMB Business Customers. The services currently provided by BCHI and the BCHI Subsidiaries to the Consumer/SMB Business Customers include landline local voice services, associated long distance voice services, associated ancillary services such as adjunct-to-basic services that are intended to facilitate completion of calls through utilization of basic telephone service facilities including, but not limited to, call waiting, speed dialing, caller ID, call blocking, call forwarding, and voicemail, and associated carrier access services; the Tempo consumer wireless voice and data services (collectively, the “ Consumer/SMB Business ”). For avoidance of doubt, the patents set forth on Annex 1 to this Exhibit D will not be transferred to Spinco but Spinco will have a perpetual, royalty free license to use such patents in the United States.x

The parties hereto agree that Annex 2 to Exhibit D (the “ Existing Annex ”) will be amended (as amended, the “ Revised Annex ”) to remove the Canadian assets and include, as agreed by the parties, certain additional assets based on customer metrics (category and RPUs) identified by the parties. The Revised Annex will be completed using the methodologies set forth in the Existing Annex. The parties agree to cooperate to finalize the Revised Annex no later than Tuesday, February 6, 2018, and attach same to this Amendment as Exhibit B.”

6. Consent to IQmax, Inc. Asset Acquisition . BCHI hereby provides its consent to the acquisition of substantially all of the assets of Iqmax, Inc. by Network Billing Systems LLC, an indirect wholly-owned subsidiary of the Corporation.

7. Effect of Amendment . This Amendment shall not constitute a waiver, amendment or modification of any other provision of the Merger Agreement not expressly contemplated hereby. Except as specifically modified and amended hereby, the Merger Agreement shall remain unchanged and in full force and effect. From and after the date hereof, each reference in the Merger Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of similar meaning shall mean and be a reference to the Merger Agreement as amended by this Amendment. Notwithstanding the foregoing, references to the date of the Merger Agreement, and references to the “date hereof”, “the date of this Agreement” or words of similar meaning in the Merger Agreement shall continue to refer to August 26, 2017.

8. Governing Law . This Amendment will be governed by, and construed and enforced in accordance with, the internal Laws of the State of Delaware, without regard to any applicable conflict of laws principles (whether of the State of Delaware or any other jurisdiction).

9. Jurisdiction . Section 9.8 (Jurisdiction) of the Merger Agreement is incorporated herein by reference and made a part hereof as if fully set forth herein.

10. Counterparts . This Amendment may be executed in two or more counterparts, all of which will be considered one and the same agreement and will become effective when counterparts have been signed by each of the Parties and delivered to the other Parties, it being understood that each Party need not sign the same counterpart. PDF transmissions of this Amendment shall be deemed to be the same as the delivery of an executed original.

[Signatures appear on following page.]

-2-

IN WITNESS WHEREOF , the Parties have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the date first above written.

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

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

Name: James P. Prenetta, Jr.

Title: Executive Vice President and

General Counsel

FUSION BCHI ACQUISITION LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Manager

BIRCH COMMUNICATIONS HOLDINGS, INC.

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

Name: Gordon P. Williams, Jr.

Title: Senior Vice President and General Counsel

-3-

Exhibit A

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

FUSION CONNECT, INC.

FUSION CONNECT, INC. (the “ Corporation ”), a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows:

FIRST : The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of Delaware on September 17, 1997.

SECOND : This Amended and Restated Certificate of Incorporation was duly adopted by the Board of Directors of the Corporation pursuant to Section 245 of the General Corporation Law of the State of Delaware.

THIRD : The Certificate of Incorporation of the Corporation shall be amended and restated in full as follows:

ARTICLE I

The name of the Corporation is Fusion Connect, Inc. (the “ Corporation ”).

ARTICLE II

The address of the Corporation’s registered office in the State of Delaware is 2711 Centerville Road, Suite 400, County of New Castle, City of Wilmington 19808. The name of the Corporation’s registered agent at such address is Corporation Service Corporation.

ARTICLE III

The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware, as amended (the “ DGCL ”).

ARTICLE IV

Section 4.1 Authorized Capital Stock . The Corporation is authorized to issue two classes of capital stock, designated Common Stock and Preferred Stock. The total number of shares of capital stock that the Corporation is authorized to issue is 160,000,000 shares, consisting of 150,000,000 shares of Common Stock, par value $0.01 per share, and 10,000,000 shares of Preferred Stock, par value $0.01 per share.

-4-

Section 4.2 Preferred Stock . The Preferred Stock may be issued in one or more series. The Board of Directors of the Corporation (the “ Board ”) is hereby authorized to issue the shares of Preferred Stock in such series and to fix from time to time before issuance the number of shares to be included in any such series and the designation, powers, preferences and relative participating, optional or other rights, if any, and the qualifications, limitations or restrictions thereof. The authority of the Board with respect to each such series will include, without limiting the generality of the foregoing, the determination of any or all of the following:

the number of shares of any series and the designation to distinguish the shares of such series from the shares of all other series;

the voting powers, if any, and whether such voting powers are full or limited in such series;

the redemption provisions, if any, applicable to such series, including the redemption price or prices to be paid;

whether dividends, if any, will be cumulative or noncumulative, the dividend rate of such series, and the dates and preferences of dividends on such series;

the rights of such series upon the voluntary or involuntary dissolution of, or upon any distribution of the assets of, the Corporation;

the provisions, if any, pursuant to which the shares of such series are convertible into, or exchangeable for, shares of any other class or classes or of any other series of the same or any other class or classes of stock, or any other security, of the Corporation or any other corporation or other entity, and the rates or other determinants of conversion or exchange applicable thereto;

the right, if any, to subscribe for or to purchase any securities of the Corporation or any other corporation or other entity;

the provisions, if any, of a sinking fund applicable to such series; and

any other relative, participating, optional, or other special powers, preferences or rights and qualifications, limitations, or restrictions thereof;

all as may be determined from time to time by the Board and stated or expressed in the resolution or resolutions providing for the issuance of such Preferred Stock (collectively, a “ Preferred Stock Designation ”).

-5-

The provisions of that certain Certificate of Rights and Preferences of Series A-1 Cumulative Convertible Preferred Stock of Fusion Telecommunications International, Inc. , as filed with the Secretary of State of the State of Delaware on December 15, 2006, as modified by that certain Certificate Reducing the Number of Authorized Shares of Series A-1 Cumulative Convertible Preferred Stock filed with the Secretary of State of the State of Delaware on September 7, 2007, and as amended by that certain Amendment to Certificate of Rights and Preferences of Series A-1 Cumulative Convertible Preferred Stock of Fusion Telecommunications International, Inc. filed with the Secretary of State of Delaware on March 28, 2014, are attached hereto as Annex A and incorporated herein by reference.

The provisions of that certain Certificate of Rights and Preferences of Series A-2 Cumulative Convertible Preferred Stock of Fusion Telecommunications International, Inc. , as filed with the Secretary of State of the State of Delaware on May 9, 2007, as modified by that certain Certificate Reducing the Number of Authorized Shares of Series A-2 Cumulative Convertible Preferred Stock filed with the Secretary of State of the State of Delaware on September 7, 2007, and as amended by that certain Amendment to Certificate of Rights and Preferences of Series A-2 Cumulative Convertible Preferred Stock of Fusion Telecommunications International, Inc. filed with the Secretary of State of Delaware on March 28, 2014, are attached hereto as Annex B and incorporated herein by reference.

The provisions of that certain Certificate of Rights and Preferences of Series A-4 Cumulative Convertible Preferred Stock of Fusion Telecommunications International, Inc. , as filed with the Secretary of State of the State of Delaware on September 11, 2007, as amended by that certain Amendment to Certificate of Rights and Preferences of Series A-4 Convertible Preferred Stock of Fusion Telecommunications International, Inc. filed with the Secretary of State of Delaware on March 28, 2014, are attached hereto as Annex C and incorporated herein by reference.

The provisions of that certain Certificate of Designations of Preferences, Rights and Limitations of Series B-2 Senior Cumulative Convertible Preferred Stock , as filed with the Secretary of State of the State of Delaware on December 27, 2013, is attached hereto as Annex D and incorporated herein by reference.

Section 4.3 Common Stock . Subject to the rights of the holders of any series of Preferred Stock, the holders of Common Stock will be entitled to one vote on each matter submitted to a vote at a meeting of stockholders for each share of Common Stock held of record by such holder as of the record date for such meeting.

ARTICLE V

The Board may make, amend, and repeal the Bylaws of the Corporation; provided, that nothing herein will limit the power of the stockholders of the Corporation to make, amend and repeal Bylaws. Any Bylaw made by the Board under the powers conferred hereby may be amended or repealed by the Board (except as specified in any such Bylaw so made or amended) or by the stockholders in the manner provided in the Bylaws of the Corporation. The Corporation may in its Bylaws confer powers upon the Board in addition to the foregoing and in addition to the powers and authorities expressly conferred upon the Board by applicable law.

-6-

Subject to the rights of the holders of any series of Preferred Stock:

(a) any action required or permitted to be taken by the stockholders of the Corporation may be taken at a duly called annual or special meeting of stockholders of the Corporation or without a meeting by means of any consent in writing of such stockholders; and

(b) special meetings of stockholders of the Corporation may be called only (i) by the Chairman of the Board (the “ Chairman ”), (ii) by the Chief Executive Officer of the Corporation (the “ Chief Executive Officer ”), or (iii) by the Secretary of the Corporation (the “ Secretary ”) acting at the request of the Chairman, the Chief Executive Officer, a majority of the total number of Directors that the Corporation would have if there were no vacancies on the Board (the “ Whole Board ”), or stockholders of the Corporation holding at least a majority of voting power of the outstanding Voting Stock. For the purposes of this Amended and Restated Certificate of Incorporation, “ Voting Stock ” means stock of the Corporation of any class or series entitled to vote generally in the election of Directors.

At any annual meeting or special meeting of stockholders of the Corporation, only such business will be conducted or considered as has been brought before such meeting in the manner provided in the Bylaws of the Corporation.

ARTICLE VI

Section 6.1 Number, Election, and Terms of Directors . Subject to the rights, if any, of the holders of any series of Preferred Stock to elect additional Directors under circumstances specified in a Preferred Stock Designation, the number of the Directors of the Corporation will not be less than one nor more than nine and will be fixed from time to time by, or in the manner provided in, the Bylaws of the Corporation. Subject to adjustment per the Bylaws, the number of Directors as of the date of this Amended and Restated Certificate of Incorporation is fixed at nine. At each annual meeting of the stockholders of the Corporation, the successors to the Directors whose term expires at that meeting will be elected by plurality vote of all votes cast at such meeting to hold office for a term expiring at the annual meeting of stockholders held in the year following the year of their election and until their successors are elected and qualified. Election of Directors of the Corporation need not be by written ballot unless requested by the presiding officer or by the holders of a majority of the Voting Stock present in person or represented by proxy at a meeting of the stockholders at which Directors are to be elected. If authorized by the Board, such requirement of a written ballot shall be satisfied by a ballot submitted by electronic transmission, provided that any such electronic transmission must either set forth or be submitted with information from which it can be determined that the electronic transmission was authorized by the stockholder or proxy holder.

-7-

Section 6.2 Newly Created Directorships and Vacancies . Subject to the rights, if any, of the holders of any series of Preferred Stock to elect additional Directors under circumstances specified in a Preferred Stock Designation, newly created directorships resulting from any increase in the number of Directors and any vacancies on the Board resulting from death, resignation, disqualification, removal, or other cause will be filled solely by the affirmative vote of a majority of the remaining Directors then in office, even though less than a quorum of the Board, or by a sole remaining Director. Any Director elected in accordance with the preceding sentence will hold office for the remainder of the full term of the Director whose seat is being filled and until such Director’s successor has been elected and qualified. No decrease in the number of Directors constituting the Board may shorten the term of any incumbent Director.

To the full extent permitted by the DGCL and any other applicable law currently or hereafter in effect, no Director of the Corporation will be personally liable to the Corporation or its stockholders for or with respect to any breach of fiduciary duty or other act or omission as a Director of the Corporation. No repeal or modification of this Article VI will adversely affect the protection of any Director of the Corporation provided hereby in relation to any breach of fiduciary duty or other act or omission as a Director of the Corporation occurring prior to the effectiveness of such repeal or modification.

ARTICLE VII

Section 7.1 Right to Indemnification . Each person who was or is made a party or is threatened to be made a party to or is otherwise subject to or involved in any claim, demand, action, suit or proceeding, whether civil, criminal, administrative or investigative (a “ Proceeding ”), by reason of the fact that he or she is or was a director or an officer of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another Corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (an “ Indemnitee ”), whether the basis of such Proceeding is alleged action in an official capacity as a director, officer, employee or agent or in any other capacity while serving as a director, officer, employee or agent, shall be indemnified by the Corporation to the fullest extent permitted or required by the DGCL and any other applicable law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than such law permitted the Corporation to provide prior to such amendment), against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such Indemnitee in connection therewith (“ Indemnifiable Losses ”); provided, however, that, except as provided in Section 7.4 of this Article VII with respect to Proceedings to enforce rights to indemnification, the Corporation shall indemnify any such Indemnitee pursuant to this Section 7.1 in connection with a Proceeding (or part thereof) initiated by such Indemnitee only if such Proceeding (or part thereof) was authorized by the Board.

-8-

Section 7.2 Right to Advancement of Expenses. The right to indemnification conferred in Section 7.1 of this Article VII shall include the right to advancement by the Corporation of any and all expenses (including, without limitation, attorneys’ fees and expenses) incurred in defending any such Proceeding in advance of its final disposition (an “ Advancement of Expenses ”); provided, however, that, if the DGCL so requires, an Advancement of Expenses incurred by an Indemnitee in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such Indemnitee, including without limitation service to an employee benefit plan) shall be made pursuant to this Section 7.2 only upon delivery to the Corporation of an undertaking (an “ Undertaking ”), by or on behalf of such Indemnitee, to repay, without interest, all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (a “ Final Adjudication ”) that such Indemnitee is not entitled to be indemnified for such expenses under this Section 7.2. An Indemnitee’s right to an Advancement of Expenses pursuant to this Section 7.2 is not subject to the satisfaction of any standard of conduct and is not conditioned upon any prior determination that Indemnitee is entitled to indemnification under Section 7.1 of this Article VII with respect to the related Proceeding or the absence of any prior determination to the contrary.

Section 7.3 Contract Rights . The rights to indemnification and to the Advancement of Expenses conferred in Sections 7.1 and 7.2 of this Article VII shall be contract rights and such rights shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the Indemnitee’s heirs, executors and administrators.

Section 7.4 Right of Indemnitee to Bring Suit . If a claim under Section 7.1 or Section 7.2 of this Article VIII is not paid in full by the Corporation within 60 calendar days after a written claim has been received by the Corporation, except in the case of a claim for an Advancement of Expenses, in which case the applicable period shall be 20 calendar days, the Indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an Advancement of Expenses pursuant to the terms of an Undertaking, the Indemnitee shall be entitled to the fullest extent permitted or required by the DGCL, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader reimbursements of prosecution or defense expenses than such law permitted the Corporation to provide prior to such amendment), to be paid also the expense of prosecuting or defending such suit. In (i) any suit brought by the Indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the Indemnitee to enforce a right to an Advancement of Expenses) it shall be a defense that, and (ii) any suit brought by the Corporation to recover an Advancement of Expenses pursuant to the terms of an Undertaking, the Corporation shall be entitled to recover such expenses, without interest, upon a Final Adjudication that, the Indemnitee has not met any applicable standard for indemnification set forth in the DGCL. Neither the failure of the Corporation (including its Board of Directors or a committee thereof, its stockholders or independent legal counsel) to have made a determination prior to the commencement of such suit that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its Board of Directors or a committee thereof, its stockholders or independent legal counsel) that the Indemnitee has not met such applicable standard of conduct, shall create a presumption that the Indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the Indemnitee, be a defense to such suit. In any suit brought by an Indemnitee to enforce a right to indemnification or to an Advancement of Expenses hereunder, or brought by the Corporation to recover an Advancement of Expenses hereunder pursuant to the terms of an Undertaking, the burden of proving that the Indemnitee is not entitled to be indemnified, or to such Advancement of Expenses, shall be on the Corporation.

-9-

Section 7.5 Non-Exclusivity of Rights . The rights to indemnification and to the Advancement of Expenses conferred in this Article VII shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, the Corporation’s Certificate of Incorporation, By-laws, agreement, vote of stockholders or disinterested directors or otherwise. Nothing contained in this Article VII shall limit or otherwise affect any such other right or the Corporation’s power to confer any such other right.

Section 7.6 Insurance . The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

Section 7.7 No Duplication of Payments . The Corporation shall not be liable under this Article VII to make any payment to an Indemnitee in respect of any Indemnifiable Losses to the extent that the Indemnitee has otherwise actually received payment (net of any expenses incurred in connection therewith and any repayment by the Indemnitee made with respect thereto) under any insurance policy or from any other source in respect of such Indemnifiable Losses.

ARTICLE VIII

From time to time any of the provisions of this certificate of incorporation may be amended, altered, or repealed and other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted in the manner and at the time prescribed by said laws, and all rights at any time conferred upon the stockholders of the Corporation by this Amended and Restated Certificate of Incorporation are granted subject to the provisions of this Article VIII.

[remainder of this page intentionally left blank]

-10-

IN WITNESS WHEREOF , the undersigned has executed this Amended and Restated Certificate of Incorporation this __ day of __________, 2018.

	FUSION CONNECT, INC.

	By:
		Name
		Title

-11-

Exhibit 10.2

FIFTH AMENDMENT

AGREEMENT AND PLAN OF MERGER

This FIFTH AMENDMENT TO AGREEMENT AND PLAN OF MERGER , dated as of January 25, 2018 (this “ Amendment ”), is entered into by and among Fusion Telecommunications International, Inc., a Delaware corporation (the “ Company ”), Fusion BCHI Acquisition LLC, a Delaware limited liability company (“ Merger Sub ”), and Birch Communications Holdings, Inc., a Georgia corporation (“ BCHI ”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Merger Agreement.

RECITALS

The Parties previously entered into that certain Agreement and Plan of Merger, dated as of August 26, 2017, as amended by the First Amendment to Agreement and Plan of Merger, dated as of September 15, 2017, the Second Amendment to Agreement and Plan of Merger, dated as of September 29, 2017, the Third Amendment to Agreement of Plan of Merger, executed on October 24, 2017, the Amended and Restated Third Amendment to Agreement and Plan of Merger, dated as of October 27, 2017, and the Fourth Amendment to Agreement and Plan of Merger, dated January 24, 2018 (collectively, the “ Merger Agreement ”).

The Parties desire to further amend the Merger Agreement as set forth herein.

The Parties hereby agree as follows:

1. Subsection (i) of the last sentence of Section 5.2 of the Merger Agreement is hereby amended by deleting the number “$10,000,000” and replacing it with the number “$40,000,000”.

2. The definition of “ Fully-Diluted Company Share Total ” set forth in Section 9.15 , is hereby deleted and replaced with the following:

“ Fully-Diluted Company Share Total ” means, as of immediately prior to the Effective Time, the number of shares of Company Common Stock issued and outstanding (excluding, for this purpose, the shares of Company Common Stock to be issued by the Company in connection with its acquisition of assets of Iqmax, Inc. (not to exceed 300,000 shares) and any shares of Company Common Stock issued under the last paragraph of Section 5.2 in connection with any capital raise permitted thereby), plus the number of shares of Company Common Stock issued or issuable upon the conversion of the Company Preferred Stock and any other class or series of preferred stock of the Company outstanding as of immediately prior to the Effective Time, plus the number of shares of Company Common Stock issuable upon the exercise of all In-the-Money Company Warrants (as adjusted for stock splits and calculated using the treasury stock method). For avoidance of doubt, any other shares of Company Common Stock that are (a) issued after the date hereof pursuant to Section 5.2 , or (b) issuable upon the conversion of Company Preferred Stock, any other class or series of preferred stock of the Company, or any other security or debt instrument, in each case, issued after the date hereof pursuant to Section 5.2 , will be included in the Fully-Diluted Company Share Total, unless otherwise agreed by the Parties.”

-1-

3. Effect of Amendment . This Amendment shall not constitute a waiver, amendment or modification of any other provision of the Merger Agreement not expressly contemplated hereby. Except as specifically modified and amended hereby, the Merger Agreement shall remain unchanged and in full force and effect. From and after the date hereof, each reference in the Merger Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of similar meaning shall mean and be a reference to the Merger Agreement as amended by this Amendment. Notwithstanding the foregoing, references to the date of the Merger Agreement, and references to the “date hereof”, “the date of this Agreement” or words of similar meaning in the Merger Agreement shall continue to refer to August 26, 2017.

4. Governing Law . This Amendment will be governed by, and construed and enforced in accordance with, the internal Laws of the State of Delaware, without regard to any applicable conflict of laws principles (whether of the State of Delaware or any other jurisdiction).

5. Jurisdiction . Section 9.8 (Jurisdiction) of the Merger Agreement is incorporated herein by reference and made a part hereof as if fully set forth herein.

6. Counterparts . This Amendment may be executed in two or more counterparts, all of which will be considered one and the same agreement and will become effective when counterparts have been signed by each of the Parties and delivered to the other Parties, it being understood that each Party need not sign the same counterpart. PDF transmissions of this Amendment shall be deemed to be the same as the delivery of an executed original.

[Signatures appear on following page.]

-2-

IN WITNESS WHEREOF , the Parties have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the date first above written.

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

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

Name: James P. Prenetta, Jr.

Title: Executive Vice President and

General Counsel

FUSION BCHI ACQUISITION LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Manager

BIRCH COMMUNICATIONS HOLDINGS, INC.

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

Name: Gordon P. Williams, Jr.

Title: Senior Vice President and General Counsel

-3-

Exhibit 10.3

January 26, 2018

Fusion NBS Acquisition Corp.

c/o Fusion Telecommunications International, Inc.

420 Lexington Avenue, Suite 1718

New York, New York 10170

Attn: James P. Prenetta, Jr., Executive Vice President and General Counsel

Re: Consent

Ladies and Gentlemen:

Reference is hereby made to that certain Credit Agreement, dated as of November 14, 2016, as amended by that certain Consents and Amendments to Loan Documents, dated as of July 20, 2017 (as so amended, and as the same may be further amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “ Credit Agreement ”), by and among Fusion NBS Acquisition Corp., a Delaware corporation (“ Borrower ”), Fusion Telecommunications International, Inc., a Delaware corporation (“ Fusion ”), Network Billing Systems, L.L.C., a New Jersey limited liability company (“ NBS ”), Fusion BVX LLC, a Delaware limited liability company (“ BVX ”), Pingtone Communications, Inc., a Delaware corporation (“ Pingtone ”), Fidelity Telecom, LLC, an Ohio limited liability company (“ FTL ”), Fidelity Access Networks, Inc., an Ohio corporation (“ FANI ”), Fidelity Access Networks, LLC, an Ohio limited liability company (“ FANL ”), Fidelity Connect LLC, an Ohio limited liability company (“ FCL ”), Fidelity Voice Services, LLC, an Ohio limited liability company (“ FVS ”), Apptix, Inc., a Florida corporation (“ Apptix ”) and Fusion BCHI Acquisition LLC, a Delaware limited liability company (“ BCHI ”; each of Fusion, NBS, BVX, Pingtone, FTL, FANI, FANL, FCL, FVS, Apptix and BCHI are individually, a “ Guarantor ” and collectively, the “ Guarantors ”), East West Bank, as Administrative Agent, Swingline Lender, an Issuing Bank and a Lender and each other Lender from time to time party to the Credit Agreement. Capitalized terms used herein and not otherwise defined shall have the meaning assigned such terms in the Credit Agreement.

Background

Borrower has informed Administrative Agent that Fusion intends to issue Equity Securities on or about February 2, 2018 (the “ Equity Issuance ”), and in connection with such Equity Issuance, the Loan Parties shall receive approximately $30,000,000 in net proceeds therefrom (the “ Equity Issuance Proceeds ”).

-1-

Consent

Pursuant to the terms of Section 2.14(d) of the Credit Agreement, upon the receipt by any Loan Party or any of its Subsidiaries of cash proceeds from the issuance of any Equity Securities in excess of $4,000,000, Borrower is required to prepay (or cash collateralize) the Obligations with such cash proceeds. As a result of the Equity Issuance and the receipt by the Loan Parties of the Equity Issuance Proceeds, the Borrower is required to prepay the Obligations with such Equity Issuance Proceeds in excess of $4,000,000. In connection with the Equity Issuance, Borrower has requested that Administrative Agent and the Requisite Lenders consent to the Loan Parties’ retention of all Equity Issuance Proceeds, for use by the Loan Parties on Capital Expenditures and for other general corporate purposes (the “ Specified Request ”). In reliance on the representations, warranties and covenants provided herein and made by Borrower to Administrative Agent in connection with the request for such consent, Administrative Agent and the Requisite Lenders hereby consent to the Specified Request.

General

Except for the consent expressly provided by this letter agreement, the terms and provisions of the Credit Agreement and the other Loan Documents are hereby ratified and confirmed and shall continue in full force and effect. The consent provided and agreed to herein is to be effective only upon receipt by Administrative Agent of an execution counterpart of this letter agreement signed by Borrower and each Guarantor. By agreeing to this letter agreement as acknowledged below, Borrower hereby certifies and warrants to Administrative Agent and the Requisite Lenders that each of its representations and warranties contained in the Loan Documents to which it is a party are true and correct in all material respects (other than any representations or warranties qualified pursuant to their terms by materiality qualifiers, which representations and warranties shall be true and correct in all respects as written) as of the effective date of this letter agreement, including that no Default or Event of Default exists, with the same effect as though made on such effective date (after giving effect to the consent contained in this letter agreement and except to the extent any such representation or warranty is expressly stated to have been made as of a specific date, in which case such representation or warranty shall be true and correct as of such specified date). The effectiveness of the consent provided herein is conditioned upon the correctness in all material respects of all representations and warranties made by Borrower herein. The consent contained herein shall not constitute a course of dealing between Borrower and Administrative Agent and, except as expressly provided herein, shall not constitute a waiver, extension or forbearance of any Default or Event of Default, now or hereafter arising, or an amendment of any provision of the Credit Agreement or the other Loan Documents. Borrower agrees to pay to Administrative Agent, on demand, in immediately available funds, all out-of-pocket costs and expenses incurred by Administrative Agent, including, without limitation, the reasonable fees and expenses of counsel retained by Administrative Agent, in connection with the negotiation, preparation, execution and delivery of this letter agreement and all other instruments and documents contemplated hereby. This letter agreement shall be governed by, construed and enforced in accordance with all provisions of the Credit Agreement and may be executed in multiple counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same instrument. Delivery of an executed counterpart signature of this letter agreement by email transmission of a “ pdf ” or similar copy shall be equally effective as delivery of an original counterpart of this letter agreement. Any party delivering an executed counterpart signature page to this letter agreement by e-mail transmission shall also deliver an executed counterpart of this letter agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability or binding effect of this letter agreement.

-2-

Reaffirmation

By its execution hereof, each Grantor hereby consents and agrees to the terms and provisions of this letter agreement and consents and agrees that each of the Security Documents remain in full force and effect and continue to be the legal, valid and binding obligation of each such Grantor, enforceable against each such Grantor in accordance with the terms thereof.

[Signatures follow on the next page.]

-3-

Please evidence your acknowledgment and agreement to the foregoing by executing this letter agreement in the place indicated below.

EAST WEST BANK ,

as Administrative Agent

By: /s/ Richard Vian

Name: Richard Vian

Title: Senior Vice President

OPUS BANK ,

as Lender

By: /s/ Maria Ding

Name: Maria Ding

Title: Vice President

Acknowledged and agreed to:

FUSION NBS ACQUISITION CORP.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

NETWORK BILLING SYSTEMS, L.L.C.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Executive Vice President

-4-

FUSION BVX LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President

PINGTONE COMMUNICATIONS, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY ACCESS NETWORKS, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY CONNECT LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY VOICE SERVICES, LLC

By : /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY ACCESS NETWORKS, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

-5-

FIDELITY TELECOM, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

APPTIX, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FUSION BCHI ACQUISITION LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Manager

-6-

Exhibit 99.1

Fusion Announces Proposed Public Offering of Common Stock

NEW YORK, NY -- January 29, 2018 -- Fusion (NASDAQ: FSNN), a leading provider of cloud services, announced today that it intends to offer and sell approximately $30.0 million of shares of its common stock in an underwritten registered public offering. In addition, Fusion expects to grant the underwriters a 45-day option to purchase up to an additional 15% of the shares of its common stock sold in the offering to cover over-allotments, if any. All shares of common stock to be sold in the proposed offering will be offered by Fusion. The proposed offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

Pursuant to an amendment to Fusion’s Agreement and Plan of Merger with Birch Communications Holdings, Inc., dated January 25, 2018, any shares sold in this offering, if completed, will not be counted as issued and outstanding for purposes of calculating the number of shares of Fusion common stock to be issued as consideration to the Birch shareholders in connection with the closing of the merger. As a result, on a post-closing basis, the dilutive effect of this offering will be shared pro rata by current Fusion and Birch shareholders with current Fusion shareholders bearing approximately 25% of the dilution and current Birch shareholders bearing approximately 75% of the dilution from this offering.

Craig-Hallum Capital Group LLC is acting as the sole book-running manager and B. Riley FBR, Inc. is acting as a co-manager for the proposed offering.

The proposed offering is being made pursuant to a shelf registration statement on Form S-3 (File No. 333-222127) that was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on January 17, 2018. A preliminary prospectus supplement and accompanying prospectus relating to and describing the terms of the proposed offering have been filed with the SEC and may be obtained by visiting the SEC’s website at www.sec.gov or by contacting Craig-Hallum Capital Group LLC, 222 South Ninth Street, Suite 350, Minneapolis, MN 55402, by telephone at 612-334-6300 or by email at prospectus@chlm.com; or B. Riley FBR, Inc., 11100 Santa Monica Blvd., Suite 800, Los Angeles, CA 90025, by telephone at 888-295-0155 or by email at capitalmarkets@brileyco.com. The final terms of the proposed offering will be disclosed in a final prospectus supplement to be filed with the SEC.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities in this offering. Nor shall there be any sale of these securities in any state or jurisdiction in which such offering, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such state or jurisdiction.

-1-

About Fusion

Fusion, a leading provider of integrated cloud solutions to small, medium and large businesses, is the industry's single source for the cloud. Fusion's advanced, proprietary cloud service platform enables the integration of leading edge solutions in the cloud, including cloud communications, contact center, cloud connectivity and cloud computing. Fusion's innovative, yet proven cloud solutions lower our customers' cost of ownership, and deliver new levels of security, flexibility, scalability and speed of deployment. For more information, please visit www.fusionconnect.com .

Forward Looking Statements

Statements in this press release that are not purely historical facts, including statements regarding Fusion’s beliefs, expectations, intentions or strategies for the future, may be “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Such statements consist of any statement other than a recitation of historical fact and may sometimes be identified by the use of forward-looking terminology such as “may”, “expect”, “anticipate”, “intend”, “estimate” or “continue” or the negative thereof or other variations thereof or comparable terminology. The reader is cautioned that all forward-looking statements are speculative, and there are certain risks and uncertainties that could cause actual events or results to differ from those referred to in such forward-looking statements. Important risks regarding the Company’s business include the Company’s ability to raise the capital necessary to fund its acquisition of Birch Communications Holdings, Inc., its ability to obtain the required approvals necessary to close that transaction, and its ability to integrate that business following the closing; the Company’s ability to comply with covenants included in its senior debt agreements; competitors with broader product lines and greater resources; emergence into new markets; natural disasters, acts of war, terrorism or other events beyond the Company’s control; and other factors identified by Fusion from time to time in its filings with the SEC, which are available through http://www.sec.gov. However, the reader is cautioned that Fusion’s future performance could also be affected by risks and uncertainties not enumerated above.

In the event that there is any inconsistency between the information contained in this press release and the information set forth in Fusion’s Annual Report on Form 10-K or Quarterly Reports on Form 10-Q filed with the SEC, the information contained in the Annual Report on Form 10-K or Quarterly Reports on Form 10-Q governs.

Fusion Contact

Brian Coyne

212-201-2404

bcoyne@fusionconnect.com

Investor Relations

Chris Tyson

MZ North America

(949) 491-8235

FSNN@mzgroup.us

-2-

Exhibit 99.2

Fusion NBS Acquisition Corp.

c/o Fusion Telecommunications International, Inc.

420 Lexington Avenue, Suite 1718

New York, New York 10170

Attn: James P. Prenetta, Jr., Executive Vice President and General Counsel

Re: Consent

Ladies and Gentlemen:

Background

Borrower has informed Administrative Agent that NBS wishes to acquire all or substantially all of the assets (the “ Acqusition ”) of IQMax, Inc., a Delaware corporation (“ IQMax ”) pursuant to the terms of an asset purchase agreement and associated documentation, dated on or about the date hereof, by and among NBS and IQMax.

-1-

Consent

Pursuant to the terms of Section 7.01(a) of the Credit Agreement, no Loan Party is permitted to acquire all or a substantial portion of the assets of any Person, other than as permitted pursuant to Section 7.01(a) of the Credit Agreement. As a result of the Acquisition, NBS shall acquire all or substantially all of the assets of IQMax. In connection with the Acquisition, Borrower has requested that Administrative Agent and the Requisite Lenders consent to the Acquisition. In reliance on the representations, warranties and covenants provided herein and made by Borrower to Administrative Agent in connection with the request for such consent, Administrative Agent and the Requisite Lenders hereby consent to the Acquisition.

General

-2-

Reaffirmation

[Signatures follow on the next page.]

-3-

Please evidence your acknowledgment and agreement to the foregoing by executing this letter agreement in the place indicated below.

EAST WEST BANK ,

as Administrative Agent

By: /s/ David Hill

Name: David Hill

Title: First Vice President

OPUS BANK ,

as Lender

By: /s/ Maria Ding

Name: Maria Ding

Title: Vice President

Acknowledged and agreed to:

FUSION NBS ACQUISITION CORP.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

NETWORK BILLING SYSTEMS, L.L.C.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Executive Vice President

-4-

FUSION BVX LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President

PINGTONE COMMUNICATIONS, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY ACCESS NETWORKS, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY CONNECT LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY VOICE SERVICES, LLC

By : /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY ACCESS NETWORKS, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

-5-

FIDELITY TELECOM, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

APPTIX, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FUSION BCHI ACQUISITION LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Manager

-6-

Exhibit 99.3

January 8, 2018

Fusion NBS Acquisition Corp.

c/o Fusion Telecommunications International, Inc.

420 Lexington Avenue, Suite 1718

New York, New York 10170

Attn: James P. Prenetta, Jr., Executive Vice President and General Counsel

Re:

Consent

Ladies and Gentlemen:

Reference is hereby made to that certain Fifth Amended and Restated Securities Purchase Agreement and Security Agreement, dated as of November 14, 2016, as amended by that certain Consents and Amendments to Loan Documents, dated as of July 20, 2017 (as so amended, and as the same may be further amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “ Securities Purchase Agreement ”), by and among Fusion NBS Acquisition Corp., a Delaware corporation (“ Borrower ”), Fusion Telecommunications International, Inc., a Delaware corporation (“ Fusion ”), Network Billing Systems, L.L.C., a New Jersey limited liability company (“ NBS ”), Fusion BVX LLC, a Delaware limited liability company (“ BVX ”), Pingtone Communications, Inc., a Delaware corporation (“ Pingtone ”), Fidelity Telecom, LLC, an Ohio limited liability company (“ FTL ”), Fidelity Access Networks, Inc., an Ohio corporation (“ FANI ”), Fidelity Access Networks, LLC, an Ohio limited liability company (“ FANL ”), Fidelity Connect LLC, an Ohio limited liability company (“ FCL ”), Fidelity Voice Services, LLC, an Ohio limited liability company (“ FVS ”), Apptix, Inc., a Florida corporation (“ Apptix ”) and Fusion BCHI Acquisition LLC, a Delaware limited liability company (“ BCHI ”; each of Fusion, NBS, BVX, Pingtone, FTL, FANI, FANL, FCL, FVS, Apptix and BCHI are individually, a “ Guarantor ” and collectively, the “ Guarantors ”), Praesidian Capital Opportunity Fund III, LP, a Delaware limited partnership (“ Fund III ”), Praesidian Capital Opportunity Fund III-A, LP, a Delaware limited partnership (“ Fund III-A ”), United Insurance Company of America, an Illinois corporation (“ United ” and together with Fund III, Fund III-A and each of their respective successors and permitted assigns, each a “ Lender ”, and collectively, the “Lenders ”), and Fund III as agent for the Lenders (in such capacity, the “ Agent ”). Capitalized terms used herein and not otherwise defined shall have the meaning assigned such terms in the Securities Purchase Agreement.

Background

Borrower has informed the Agent that NBS wishes to acquire all or substantially all of the assets (the “ Acquisition ”) of IQMax, Inc., a Delaware corporation (“ IQMax ”), pursuant to the terms of an asset purchase agreement and associated documentation, dated on or about the date hereof, by and among NBS and IQMax.

-1-

Consent

Pursuant to the terms of Section 7.01(a) of the Securities Purchase Agreement, no Loan Party is permitted to acquire all or a substantial portion of the assets of any Person, other than as permitted pursuant to Section 7.01(a) of the Securities Purchase Agreement. As a result of the Acquisition, NBS shall acquire all or substantially all of the assets of IQMax. In connection with the Acquisition, Borrower has requested that the Agent and the Requisite Lenders consent to the Acquisition. Borrower represents, warrants, covenants and agrees to and with the Agent and Lenders that the consideration to be paid for the assets to be acquired from IQMax will not include the issue of any Indebtedness by any of the Loan Parties and is currently anticipated to consist solely of shares of common stock of Fusion, $0,01 par value per share, except to the extent of any Royalty Fee (as defined in the asset purchase agreement for the Acquisition). In reliance on the representations, warranties, covenants and agreements provided herein and made by Borrower to the Agent in connection with the request for such consent, the Agent and the Requisite Lenders hereby consent to the Acquisition.

General

Except for the consent expressly provided by this letter agreement, the terms and provisions of the Securities Purchase Agreement and the other Loan Documents are hereby ratified and confirmed and shall continue in full force and effect. The consent provided and agreed to herein is to be effective only upon receipt by the Agent of an executed counterpart of this letter agreement signed by Borrower and each Guarantor. By agreeing to this letter agreement as acknowledged below, Borrower hereby certifies and warrants to the Agent and the Requisite Lenders that each of its representations and warranties contained in the Loan Documents to which it is a party are true and correct in all material respects (other than any representations or warranties qualified pursuant to their terms by materiality qualifiers, which representations and warranties shall be true and correct in all respects as written) as of the effective date of this letter agreement, including that no Default or Event of Default exists, with the same effect as though made on such effective date (after giving effect to the consent contained in this letter agreement and except to the extent any such representation or warranty is expressly stated to have been made as of a specific date, in which case such representation or warranty shall be true and correct as of such specified date). The effectiveness of the consent provided herein is conditioned upon the correctness in all material respects of all representations and warranties made by Borrower herein. The consent contained herein shall not constitute a course of dealing between Borrower and the Agent and, except as expressly provided herein, shall not constitute a waiver, extension or forbearance of any Default or Event of Default, now or hereafter arising, or an amendment of any provision of the Securities Purchase Agreement or the other Loan Documents. Borrower agrees to pay to the Agent, on demand, in immediately available funds, all out-of-pocket costs and expenses incurred by the Agent, including, without limitation, the reasonable fees and expenses of counsel retained by the Agent, in connection with the negotiation, preparation, execution and delivery of this letter agreement and all other instruments and documents contemplated hereby. This letter agreement shall be governed by, construed and enforced in accordance with all provisions of the Securities Purchase Agreement and may be executed in multiple counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which counterparts, taken together, shall constitute but one and the same instrument. Delivery of an executed counterpart signature of this letter agreement by email transmission of a “ pdf ” or similar copy shall be equally effective as delivery of an original counterpart of this letter agreement. Any party delivering an executed counterpart signature page to this letter agreement by e-mail transmission shall also deliver an executed counterpart of this letter agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability or binding effect of this letter agreement.

Reaffirmation

[Signatures follow on the next page.]

-2-

Please evidence your acknowledgment and agreement to the foregoing by executing this letter agreement in the place indicated below.

LENDERS :

PRAESIDIAN CAPITAL OPPORTUNITY

FUND III, LP

By: Praesidian Capital Opportunity GP III, LLC,

its General Partner

By: /s/ Jason D. Drattell

Name: Jason D. Drattell

Title: Manager

PRAESIDIAN CAPITAL OPPORTUNITY FUND III-A, LP

By: Praesidian Capital Opportunity GP III-A, LLC,

its General Partner

By: /s/ Jason D. Drattell

Name: Jason D. Drattell

Title: Manager

AGENT:

PRAESIDIAN CAPITAL OPPORTUNITY FUND III, LP

By: Praesidian Capital Opportunity GP III, LLC, its General Partner

By: /s/ Jason D. Drattell

Name: Jason D. Drattell

Title: Manager

[signature page – fusion nbs acquisition corp. consent]

-3-

Acknowledged and agreed to:

FUSION NBS ACQUISITION CORP.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FUSION TELECOMMUNICATIONS INTERNATIONAL, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

NETWORK BILLING SYSTEMS, L.L.C.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Executive Vice President

FUSION BVX LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President

PINGTONE COMMUNICATIONS, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY ACCESS NETWORKS, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

[signature page – fusion nbs acquisition corp. consent]

-4-

FIDELITY CONNECT LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY VOICE SERVICES, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY ACCESS NETWORKS, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FIDELITY TELECOM, LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

APPTIX, INC.

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: President and Chief Operating Officer

FUSION BCHI ACQUISITION LLC

By: /s/ Gordon Hutchins, Jr.

Name: Gordon Hutchins, Jr.

Title: Manager

[signature page – fusion nbs acquisition corp. consent]

-5-