Fusion Closes on Approximately $44.0 Million of Fi

Fusion Closes on Approximately $44.0 Million of Financing

Enables Acquisition of Cloud Services Business

NEW YORK, NY--(Marketwired - Jan 6, 2014) - Fusion (OTCQB: FSNN), an emerging leader in the cloud services market, today announced that on December 31, 2013, it closed several financing transactions aggregating to approximately $44.0 million, comprised of approximately $18.5 million in equity, and $25.5 million in term debt.

Fusion raised approximately $18.5 million through a private placement of investment units consisting of Convertible Preferred Securities and Warrants to accredited investors, including all members of Fusion's Board of Directors and members of its Advisory Board. As part of the capital raised in the offering, Matthew Rosen, Fusion's Chief Executive Officer and Marvin Rosen, Fusion's Chairman, exchanged $2.05 million of Company obligations for the investment units sold in the private placement. Fusion received net cash proceeds in the private placement, after giving effect to transaction expenses, of approximately $15.6 million.

Aegis Capital Corp. served as lead placement agent.

In addition to the equity, Fusion raised $25.5 million through the issuance of 5-year senior notes to Praesidian Capital and Plexus Capital, Fusion's existing lenders.

The Company's aggregate net proceeds from these financing transactions was $40.5 million, $32.1 million of which was used to fund its acquisition of the cloud services assets of Broadvox's business services division, with the remainder to be used for acquisition transaction expenses, to advance sales and marketing efforts, and for general corporate purposes. The Broadvox cloud services unit will be integrated into NBS, Fusion's cloud services division. NBS was acquired in October, 2012, and fully integrated by the end of the first quarter of 2013. The addition of NBS' proprietary platform and infrastructure has accelerated Fusion's organic growth and enabled the Company to effectively integrate the current acquisition of Broadvox's cloud services, as well as facilitate future accretive acquisitions.

"The strong support we received in the financing from new and existing shareholders, Directors, Advisory Board members, and from financial partners such as Praesidian Capital, Plexus Capital, and several other notable institutions and individuals, reaffirms our confidence that we have the right strategy for growth," said Matthew Rosen, Fusion's Chief Executive Officer. "This financing advances our cloud services strategy with an acquisition that will allow us to rapidly scale, accelerate our organic growth and effectively plan for additional strategic acquisitions as we emerge as a leading provider in the cloud services marketplace," continued Mr. Rosen.

Commenting on the transaction, Glenn C. Harrison, Managing Director of Praesidian, said, "Since our initial investment, we have become very familiar with the talented Fusion management team through this acquisition as well as their acquisition of NBS last year, and have found them to be both innovative and experienced. Their success at meeting key goals in 2013 confirms our confidence in what we believe to be a winning strategy and plan."

Expanding on Mr. Harrison's comments, Mike Becker, co-founder and Partner of Plexus, said, "We believe this financing strongly reflects our commitment to support Fusion in the execution of its strategy."

Further details of the equity financing are contained in Fusion's Current Report on Form 8-K filed today with the SEC.