REALLOCATION AND ASSIGNMENT AGREEMENT

AGREEMENT made as of February 16, 2007 among VoIP, Inc., a Texas corporation (the “Company”), and the parties identified on Schedule A hereto (“Lenders”).

WHEREAS, commencing November 27, 2006 through January 18, 2007, several Bridge Loans were made by the Lenders to the Company in an aggregate amount of $866,667 (“Bridge Loans” or “Bridge Notes”); and

WHEREAS, in contemplation of the completion of a new financing transaction among the Company and Lenders for an aggregate of $3,462,719 of principal amount of promissory notes of the Company in exchange for cash and surrender of certain outstanding promissory notes, it is agreed that it is in the best interests of the parties to reallocate and assign among the Lenders $866,667 principal amounts of the Bridge Loans.

NOW THEREFORE, in consideration of the mutual promises and covenants set forth in this Agreement, it is agreed:

1.    Effective immediately, an aggregate $866,667 principal amount of the Bridge Loans will be reallocated and assigned in the amounts and to the Lenders as more fully described on Schedule A hereto.

2.    The undersigned consent to the reallocation and assignment of an aggregate $866,667 principal amount of the Bridge Loan comprised of funds received from Lenders in connection with the Bridge Loans, together with a portion of the cash to be received in connection with the new financing transaction, so that after such reallocation and assignment, the Bridge Notes are deemed held by the Lenders in the amounts set forth on Schedule A hereto.

3.    All other terms and conditions of the Bridge Loans shall remain in full force and effect.

 

4.    This Agreement may be executed in any number of counterparts and by different signatories hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute but one and the same instrument. This Agreement may be executed by facsimile transmission and delivered by facsimile transmission.

 

 

5.  Each of the undersigned states that he has read the foregoing Reallocation and Assignment Agreement and understands and agrees to it.

 

LENDERS	AGGREGATE BRIDGE LOAN TO BE REALLOCATED AND ASSIGNED
ALPHA CAPITAL ANSTALT Pradafant 7 9490 Furstentums Vaduz, Lichtenstein Fax: 011-42-32323196	$135,200.00
WHALEHAVEN CAPITAL FUND LIMITED 3rd Floor, 14 Par-Laville Road Hamilton, Bermuda HM08 Fax: (441) 292-1373	$124,800.00
ELLIS INTERNATIONAL LTD. 53rd Street Urbanizacion Obarrio Swiss Tower, 16th Floor, Panama Republic of Panama Fax: (516) 887-8990	$121,333.00
BRISTOL INVESTMENT FUND, LTD. c/o Caledonian Fund Services Limited 69 Dr. Roy’s Drive George Town, Grand Cayman Cayman Islands Fax: (310) 696-0334	$156,000.00
CHESTNUT RIDGE PARTNERS LP 50 Tice Boulevard Woodcliff Lake, NJ 07677 Fax: (201) 802-9450	$62,400.00
CENTURION MICROCAP, L.P. 3014 Avenue L Brooklyn, NY 11210 Fax: (718) 228-9570	$104,000.00
PLATINUM LONG TERM GROWTH II INC. 152 West 57th Street New York, New York 10019 Attn: Mark Nordlicht Fax: (212)	$52,000.00
DOUBLE U MASTER FUND L.P. P. O. Box 972 Harbour House Roadtown, Tortola, BVI Fax: (284) 494-4770	$62,400.00
DKR SOUNDSHORE OASIS HOLDING FUND LTD. C/o DKR Capital Partners, L.P. 1281 East Main Street Stamford, CT 06902 Fax: (203) 674-4737	$24,267.00
CMS CAPITAL 9612 Van Nuys Blvd., Suite 108 Panorama City, CA 91402 Fax: (818) 907-3372	$24,267.00
TOTALS	$866,667.00