TEUM Pareteum Corporation

On September 30, 2016, Elephant Talk Communications Corp. (the “ Company ”) entered into a share purchase agreement (the “ SPA ”) with VSFT Holdings, Inc. (the “ Buyer ”), a company formed by Patrick M. Carroll, the former President of the Company and the original founder and Chief Executive Officer of ValidSoft (as defined below), and certain third party investors, pursuant to which the Company sold its wholly-owned subsidiary, ValidSoft Limited (“ ValidSoft Limited ”), including ValidSoft Limited’s wholly-owned subsidiary ValidSoft UK Limited (collectively with ValidSoft Limited, “ ValidSoft ”), to the Buyer. ValidSoft provides cloud-based authentication and voice-biometrics technology and services that are designed to combat electronic fraud and enhance cyber security across all payment channels.

Pursuant to the terms of the SPA, the Buyer purchased ValidSoft, and assumed all of its liabilities, for $2,000,000 in cash and a $1,000,000 unsecured promissory note in favor of the Company (the “ Note ”). The purchase price was determined based upon a revenue multiple that the Company believed was consistent with market rates given the nature and state of the ValidSoft business. In addition, the Company received a right of first refusal with respect to any future sale of shares (subject to certain limitations described in the SPA) or assets of ValidSoft by the Buyer. The Company has applied the cash proceeds of the ValidSoft sale towards reducing its outstanding debt obligations to its senior secured lender.

The Note, which was issued by the Buyer on September 30, 2016, bears interest at 5% per annum and matures on September 30, 2018. Upon an event of default, which may occur following any failure by the Buyer to make a payment under the Note when due, upon any other breach of the Note or the SPA by the Buyer or upon bankruptcy, liquidation, dissolution of winding up of the Buyer, all obligations under the Note will become immediately due and payable to the Company. Pursuant to the terms of the Note, the Buyer is obligated to make quarterly payments under the Note in an amount equal to 5% of quarterly gross revenue of ValidSoft. The Buyer may prepay the Note at any time without penalty. The Note is subordinated to certain outstanding indebtedness of the Buyer.

In connection with the sale of ValidSoft, on September 30, 2016, the Company entered into a license agreement (the “ License Agreement ”) with the Buyer pursuant to which the Company’s subsidiary received a worldwide, perpetual, irrevocable, non-exclusive, non-transferable (except in limited circumstances), non-sublicensable (except in limited circumstances) license to embed ValidSoft’s authentication and voice biometric technology in its cloud-based mobility platform and to certain other services as described in more detail in the License Agreement (the “ Products and Services ”). The license, which is royalty free and has been granted by the Buyer at no cost to the Company, is valid for the use of the Products & Services for authentication purposes in respect of those end-users who are: (a) employees, consultants, contractors and other personnel of the Company or (b) customers of the Company’s technology for cloud-mobility and cloud-messaging platform. The license is limited by the number of end-users that the Company may authorize to utilize the Products and Services, but the Buyer agreed to negotiate in good faith with the Company in the event that the license is needed for additional end-users. The License Agreement may be terminated by either party upon a material breach by the other party of the License Agreement or upon the institution of bankruptcy, dissolution or liquidation proceedings as described in the License Agreement. The License Agreement is subject to certain indemnification and confidentiality provisions.

The foregoing description of the sale of ValidSoft, the Note and the License Agreement do not purport to be complete and are qualified in their entirety by reference to the form of SPA, the Note and the License Agreement, a copy of which is being filed as Exhibit 10.1, 10.2 and 10.3 hereto, respectively, and are incorporated herein by reference.