EXHIBIT 10.49

SETTLEMENT AGREEMENT AND RELEASE AS OF JANUARY 26, 2005

        A. Effective Date. This Settlement Agreement and Release (hereinafter referred to as the “Agreement”) is made effective as of January 26, 2005.

        B. Parties. The parties to this Agreement are as follows:

                 a. Glowpoint, Inc., a Delaware corporation (“Glowpoint”);

                 b. Gores Technology Group, a California corporation (“Gores”);

                 c. Wire One Communications, Inc. a Delaware corporation (“Wire One”);

        The above parties are collectively referred to herein as the “Settling Parties” or the “Parties.” With the intent of being legally bound, the Settling Parties hereby agree as follows:

RECITALS

        WHEREAS, Glowpoint (then known as Wire One Technologies, Inc.) and Gores entered into an Asset Purchase Agreement (the “APA”) dated as of June 10, 2003.

        WHEREAS, Gores assigned its rights under the APA to Gores Holding Corp., a Delaware corporation, which corporation changed its name to Wire One Technology, Inc., a Delaware corporation, upon closing of the APA; and Wire One Communications, Inc. is the successor entity to Wire One Technology, Inc. by merger filed with the Delaware Secretary of State on November 19, 2004.

        WHEREAS, in connection with the closing of the transactions under the APA, Gores Holding Corp. and Glowpoint entered into a Transition Services Agreement (the “TSA”) dated as of September 23, 2003.

        WHEREAS, pursuant to Section 2.2(a) of the APA, Gores Holding Corp. executed and delivered in favor of Glowpoint that certain Promissory Note, dated September 23, 2003, in the principal amount of one million dollars ($1,000,000), with a maturity date of December 31, 2004 (the “Note”).

        WHEREAS, in connection with the closing of the transactions under the APA, Gores Holding Corp. and Glowpoint entered into an Escrow Agreement (the “Escrow Agreement”), dated as of September 23, 2003, pursuant to which Gores Holding Corp. deposited with a third party escrow agent $335,000 of the Cash Payment (as defined in Section 2.2(a) of the APA) by Gores to Glowpoint (the “Escrow Fund”) to be held pending determination of certain “Transition Cost Amounts” pursuant to Section 5.14 of the APA.

        WHEREAS, pursuant to Section 2.2(a) of the APA, Gores is to pay to Glowpoint $2,000,000 at such time certain purchase price adjustments were determined pursuant to Section 2.3 of the APA (the “Holdback Amount”).

        WHEREAS, certain disputes have arisen with respect to the Parties’ rights and obligations pursuant to the APA, the TSA, the Note and otherwise.

        WHEREAS, Glowpoint filed a lawsuit in the United States District Court for the Southern District of New York, entitled Glowpoint, Inc. v. Gores Technology Group , Civil Action No. 04-cv-09430 (S.D.N.Y.) (the “Action”), seeking to recover $5 million from Gores for alleged breaches of Section 5.9 of the APA (the “Buyer Non-Compete Provision”).

        WHEREAS, Glowpoint has made one or more written requests that Gores and/or Wire One reimburse Glowpoint for certain costs and expenses incurred by Glowpoint prior to the date hereof with respect to the business and assets sold to Gores under the APA (the “Unreimbursed Transition Costs”).

        WHEREAS, in resolution of certain disputes between the Parties under Sections 2.3 and 5.14 of the APA, on or about January 10, 2005, an arbitrator determined that the Net Assets at the Measurement Date were $9,647,171 (resulting in a “final cash adjustment” amount of approximately $4.340 million due to Gores from Glowpoint) and that the Transition Cost Amount was $1,046,350, and awarded Glowpoint certain costs of the arbitration to be paid by Gores (the “Arbitration Award”).

        WHEREAS, the Parties now desire to fully compromise and settle the disputes described herein, while leaving certain continuing rights and obligations under the APA and TSA in force.

         NOW THEREFORE, in consideration of the promises, covenants and agreements hereinafter set forth and the exchange of consideration, the sufficiency of which is hereby acknowledged, the Parties hereby agree as follows:

SETTLEMENT TERMS

        1. Payment. Upon the delivery by (a) Glowpoint to counsel of record for Gores, as identified below, of a Notice of Dismissal of the Action, as provided for in paragraph 2 hereof; and (b) each of the Parties to counsel of record for the other Parties, as identified below, a counterpart original of this Agreement executed by such Party; Gores shall then (i) immediately cause Wire One to execute an instruction (the “Escrow Release Instruction” described in Exhibit “A” attached hereto) to the Escrow Agent under the Escrow Agreement to release the Escrow Fund, together with all accrued interest thereon, to the order of Glowpoint; and (ii) as promptly as possible but in any event within three business days cause an amount in immediately available funds equal to the sum of $2.75 million (the “Settlement Monies”) to be paid to Glowpoint by making payment of the Settlement Monies by wire transfer to the Client Trust Account of Glowpoint’s counsel of record, pursuant to wire transfer instructions provided by such counsel attached hereto as Exhibit “B”.

        2. Dismissal. Glowpoint shall deliver to counsel for Gores a duplicate original Notice of Dismissal, dismissing the Action in its entirety, with prejudice, with each party to bear its own fees and costs; substantially in the form of Exhibit “C” hereto. Within one business day after counsel’s receipt of the Settlement Monies and the delivery of the Escrow Release Instruction referred to in paragraph 1 above, Glowpoint shall file the original Notice of Dismissal with the Clerk of the Court for the United States District Court for the Southern District of New York. Immediately upon the filing of the Notice of Dismissal, Glowpoint shall be entitled to receipt of the Settlement Monies from its counsel.

        3. No Admissions Regarding Liability. Although this Agreement resolves the disputes described herein between the Parties, it does not constitute an admission by either Party of any of the claims or matters alleged in the Action or otherwise, or an admission of any violation of federal, state or local law, ordinance or regulation or of any liability or wrongdoing whatsoever. Neither this Agreement nor anything in this Agreement nor any information related to the negotiation of this Agreement shall be construed to be or shall be admissible in any suit, action or other proceeding as evidence of liability or wrongdoing by any Party hereto. This Agreement may be introduced, however, in any suit or action to enforce this Agreement or the rights or obligations of any Party hereunder.

        4. Releases. In consideration hereof:

                 a. Glowpoint hereby relieves, releases and forever discharges Gores, and its respective members, partners, shareholders, employees, agents, subsidiaries, affiliates, successors, assigns, personal representatives, predecessors, affiliated organizations and attorneys including, without limitation, Wire One, and the respective heirs, executors, trustees, administrators, successors

and assigns of any such persons and entities, and each of them, of and from the following claims, causes of action, debts and liabilities: