SEPARATION AGREEMENT AND RELEASE
This Separation Agreement and Release (this “Agreement”) is entered into as of the 15
day of August
2008, between Wade Spooner (“Spooner”) and Xfone USA, Inc. (the “Company”).
A. Spooner was employed by the Company as President and Chief Executive Officer pursuant to
an Employment Agreement dated March 10, 2005 (the “Employment Agreement”) which expired on March 10,
2008 and Spooner was notified in writing on March 11, 2008 that the Company was not renewing the
Employment Agreement and Spooner’s employment with the Company ended at the close of business on March
11, 2008 (the “Employment Expiration Date”).
B. Spooner and the Company wish to compromise and settle all claims and issues arising from or
related to Spooner’s employment with the Company, on the terms and conditions expressed in this Agreement.
NOW, THEREFORE, based upon the foregoing recitals, in consideration of the mutual terms, covenants
and conditions hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of
which are acknowledged by each party, Spooner and the Company agree as follows:
Payments to Spooner
1.1 In full settlement of any and all claims by Spooner against the Company, the Company shall
cause to be paid to Spooner the following:
(i) Cash Payments . $210,000.00 payable in twenty four (24) bi-monthly payments of $8,750.00
on the 15
and the last day of each month or on the next business day if a payment date falls on either a
weekend or holiday beginning following the date that this Agreement is no longer revocable as provided in
Section 19 hereof. The Company agrees to direct deposit these payments to a bank account specified by
Spooner in writing to the Company.
(ii) New Warrants . 300,000 non-tradable warrants (“New Warrants”) to purchase restricted
common stock of Xfone, Inc. (“Xfone Common Stock”) which warran