EXHIBIT 10.4
CONSENT, WAIVER AND ACKNOWLEDGEMENT
THIS
CONSENT, WAIVER AND ACKNOWLEDGEMENT (this "Consent"), dated as
of
August 3, 2005, is by and among VOIP, INC.
("Parent"), and CAERUS, INC.
("Caerus"), VOLO COMMUNICATIONS,
INC.("Volo"), CAERUS NETWORKS, INC., CAERUS
BILLING, INC. and the subsidiaries of Volo
that are signatories hereto
(collectively, the "Corporation"), and
CEDAR BOULEVARD LEASE FUNDING, INC. (the
"Lender").
WHEREAS,
the Corporation and Lender are parties to that certain
Subordinated Loan and Security Agreement,
dated as of June 1, 2004 (the "Credit
Agreement"), pursuant to which the
Corporation established a credit facility
with Lender;
WHEREAS,
Parent, the sole stockholder of Caerus and guarantor of the
obligations of the Corporation under the
Credit Agreement, intends to purchase
substantially all of the assets (the "Asset
Purchase") of WQN, Inc. ("WQN"),
pursuant to an Asset Purchase Agreement,
dated August 1, 2005, between Parent
and WQN (the "Asset Purchase Agreement")
and, in connection therewith, issue to
WQN a bridge note, in the principal amount
of $1 million, (the "Bridge Note"),
and, upon closing of the transactions
contemplated by the Asset Purchase
Agreement, issue a Convertible Promissory
Note, in the principal amount of $3.7
million to WQN (the "Convertible Note,"
together with the Bridge Note, the
"Notes"), which Notes shall be secured by a
junior security interest in the
assets of Parent (which assets include the
Corporation); and
WHEREAS,
it is a condition to the execution of the Asset Purchase
Agreement, the issuance of the Bridge Note
and the subsequent completion of the
Asset Purchase and issuance of the
Convertible Note, that Lender (1) acknowledge
that the Corporation is not in default of
the Credit Agreement or other Loan
Agreements (as defined in the Credit
Agreement), and (2) consent to certain
matters.
NOW,
THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby
acknowledged, the parties to this Consent hereby
agree as follows:
1.
ACKNOWLEDGEMENT. Lender hereby represents and acknowledges that, to
the
best of its knowledge, no Event of Default
(as defined in the Credit Agreement)
under the Credit Agreement or any default
under any of the other Loan Agreements
presently exists, or is continuing or will
result from the transactions
contemplated by the Asset Purchase
Agreement, except to the extent that the
Credit Agreement is concurrently being
amended to provide that it shall be an
Event of Default if Parent is obligated to
make any cash payments to WQN under
that certain Convertible Note to be issued
by Parent in favor of WQN upon
closing of the Asset Purchase (the "WQN
Note") because Parent fails to file a
Certificate of Designation establishing a
series of Preferred Stock as required
under the WQN Note (as the same may be
amended from time to time).
2. CONSENT
AND WAIVER OF RIGHTS. Lender hereby consents to the Asset
Purchase and the transactions contemplated
by the Asset Purchase Agreement,
including, but not limited to, the issuance
of the Notes and the creation of the
security interest in favor of WQN and
hereby waives Sections 7.01(b), (f) and
(j) of the Credit Agreement in connection
with the Asset Purchase.
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3. NO
FURTHER WAIVER. Lender is not waiving any rights with respect
to
Sections 7.01(b), (f) and (j) or any of the
other provisions of the Credit
Agreement with respect to any transaction
or event other than those contemplated
in connection with the Asset Purchase.
Lender reserves the right, in its
discretion, to exercise any or all of its
rights and remedies under the Credit
Agreement or any of the other Loan
Documents (as defined in the Credit
Agreement) as a result of any Events of
Default that may be continuing as of the
date hereof or any Event of Default that
may occur after the date hereof, and
Lender has not waived any of such rights or
remedies, and nothing in this
Agreement, and no delay on its part in
exercising any such rights or remedies,
should be construed as a waiver of any such
rights or remedies.
4.
NOTICES. All notices and communications to be given or otherwise
made
to any party to this Consent shall be
deemed to be sufficient if contained in a
written instrument delivered in person or
by telecopier or duly sent by first
class registered or certified mail, return
receipt requested, postage prepaid,
or by overnight courier, addressed to such
party at the address set forth below:
(a) if to the Parent, to:
VoIP, Inc.
12330 S.W. 52rd Street Suite 712
Ft. Lauderdale, FL 33330
Attention: Steven Ivester
with a copy to:
Andrews Kurth LLP
1717 Main Street Suite 3700
Dallas, Texas 75201
Attention: Ronald Brown, Esq.
(b) if to the Corporation, to:
Caerus, Inc.
151 South Wymore Road, Suite 3000
Altamonte Springs, Florida 327
