ZRF PARTNERS ??Hunz MU C. i0 ?53 3N November 19, 20l 7 City of Burlington 149 Church Street Burlington, VT 0540i Attention: Terry Dorman Dear Terry: It is our pleasure to submit this Letter of Intent for the purchase of all or substantially all of the assets of Burlington Telecom (??Company? or by ZRF Partners, LLC We are honored and excited that Schurz Communications, Inc. (?Schurz?) has agreed to participate as a strategic partner in proposal. Schurz is in the process of completing its acquisition of Hiawatha Broadband, inc. ZRF and Schurz/HBC are well positioned through industry knowledge, expertise and track record to continue the legacy of ET by expanding the focus on outstanding customer service and maintaining the quality of its network for the benefit of customers and the City of Burlington. As one of the Nation?s first competitive ?ber providers, HBC has long been a role model for BT and others. BT and HBC have worked together in the past as BT sought to learn from HBC to improve the efficiency and performance of its operations. We believe ZRF/Schurz ownership will provide BT a unique opportunity to partner with HBC, exchanging best practices and benefitting from proven technical expertise, customer service and community engagement, as weli as hard-learned growth strategies, from expansion beyond Winona?s borders into more than 13 additional communities. This proposal meets or exceeds the criteria laid out by the City for the selection of the Buyer and will maintain independence as well as its strong ties to the City of Burlington. Our vision is to significantly grow BT and further strengthen its bond with the local community by making BT a key enabler of new tech startups as well as providing a strong platform for local technology workforce development. This letter is not intended to, and does not, create a binding commitment, but evidences our willingness to work together in good faith to jointiy craft a transaction that is suitable and acceptable to all stakeholders. We outline general terms and conditions below and look forward to an opportunity to work together with you to refine these terms over coming weeks. Structure of the Transaction and Purchase Price ZRF wiil purchase BT at an enterprise value of $25 million, payable in cash at closing. The purchase price assumes the Company has zero working capital (current assets less current liabilities) at closing and that FY 2018 budgeted Capex of $2.5 million is invested in network growth. While ZRF is prepared to offer cash consideration to ali of the current shareholders, we would also provide an opportunity (up to a mutually decided limit and subject to proration above the agreed limit) to existing shareholders to reinvest their equity into the new entity. Any equity rollovers by existing shareholders will be subject to approval by the City of Burlington. We believe rolling over equity offers a compelling proposition for current owners. We intend to offer employment to all of the existing employees of BT and plan to create an employee option pool post-closing. Employee benefits will include a competitive health care plan and a 401K participation opportunity for all full-time employees. The definitive agreement will include terms, conditions, representations, warranties and indemnities appropriate for transactions similar to the proposed transaction, including a dispute resolution process. Substantial Value Proposition for Roll-over Equity ET is a scarce and strategic asset. With our leadership and strategy, we believe value will grow exponentially in the coming years. Our vision is to make BT one of the most admired regional ?ber companies nationwide. We believe in the growth prospects of the Company and would position BT to deepen its penetration in the Burlington market, expand its presence in small to medium size business customers and support its current plans to build out almost all (except 120 homes) of the unbuilt areas in Burlington by June 20l9. We will also opportunistically expand its network into surrounding communities in a ?scally responsible manner. Additionally, there is a unique partnership/acquisition opportunity in Tier Two and Three markets that ET is well positioned to exploit. ZRF and Schurz/HBC are hands-on partners and have a track record of growing companies in similar situations and identifying/nurturing future technology leaders. Our vision is to set the standard nationally for independent ?ber networks that are recognized for price, community engagement, digital equality and technical leadership in communities focused on providing next generation fiber infrastructure to enable economic development opportunities. We plan to enhance pro?tability 2-3x organically in the near to medium term and significantly more if successful in partnership/acquisition opportunities. We plan to reinvest entire pro?ts back into growth?related initiatives. Commitment to Burlington City Under our ownership, BT will play a critical role in the development of a technology ecosystem in Burlington by reducing major barriers (Le. access to capital and talent) in the way of formation/retention of tech start-ups. BT would work with other stakeholders (BTV ignite, universities/colleges and City) and invest $1.75 million over 7 years to establish a BTV Ignite Technology Innovation Fund (BT BTV Ignite partnership terms to be agreed) that provides mentorship and seed capital to local startups. We will maintain and expand community initiatives including Edu~Net for low income students, Lifeline for qualifying residents, and other initiatives aimed at bridging the digital divide and improving opportunities for all. BT would also start an apprenticeship/intemship program that would provide an opportunity for students to gain valuable real?world experience and skillsets. In addition, BT would contribute $350,000 over 7 years to establish a program in partnership with local resources to teach basic technical skills/competencies necessary to remain relevant and improve employment prospects in today?s work environment, to Burlington?s existing workforce/high school students. We would Page 2 of4 encourage and hope that local businesses and anchor institutions will also contribute to the BTV Ignite Technology Innovation Fund and help build this retraining program aimed at creating more and better payingjobs in Burlington. We would actively support Burlington?s smart city initiative and would make network available for any initiatives that would not limit the capabilities or commercial prospects of BT. We have no plans to increase broadband prices and will continue to seek ways to offer better values to BT customers. We will hold broadband rates steady for a minimum of 36 months and limit any price increases on video content to those passed on to ET by content providers. We also agree with the City?s concern about avoiding a monopoly situation that may be caused from any subsequent BT sale and would accept a limited sale restriction to prevent such an outcome. Additionally, we will offer a right of first refusal to the City of Burlington on any future sale of BT provided the City elects to operate BT as a wholly owned municipal entity. Additional Terms We will offer the City an ability to nominate an industry expert to Board of Directors, assuming the City decides to roll most of its equity stake. Prior to closing, we will work with the City to close open items critical to operations as an independent company, including but not limited to: ?nalizing the Municipal Contract for Telecom and Broadband infrastructure and services; (2) executing a long-term building lease for 200 Church Street together with a right of first refusal or an option to buy the building at market value, and (3) ?nalizing any other City related agreements that are important to you. We will work cooperatively with the City on the future potential need to relocate BT facilities from Memorial Auditorium and can complete such move with a minimum notice of 18 months. Exclusivity and Confirmatory Due Diligence We request an exclusivity period to conclude due diligence and to prepare closing documents. We expect to perform con?rmatory due diligence on the Company, including but not limited to review of Company ?nancial, operational, legal, regulatory and systems attributes. Please note that, as mentioned above, this letter does not and will not create any binding commitment by the Company, ZRF Partners and Schurz Communications or any of their af?liates. We believe a partnership between ZRF and Schurz/HBC allows BT and Burlington an exciting path to realize the full value of not just maximize its economic recovery and long-term returns but more importantly become a meaningfully larger business, centered in Burlington, and an engine to enable technology startups and generate/retain well?paying jobs for Burlingtonians. Burlington has one of the best ?ber networks in the nation; ripe for gaming, arti?cial intelligence, IOT, augmented/virtual reality and cutting-edge medical research startups. We intend to play a modest but important role in the development of a sustainable technology eco- system that nurtures and grows start-ups and young entrepreneurs, while developing a workforce with the skills to support that growth and ensuring a commitment to community that supports opportunities for all. We have the experience and expertise to help build a BT that is ?nancially Page 3 of 4 strong, socially aware and one that serves as the benchmark of municipal ?ber?builds. Both ZRF and Schurz are enthusiastic about this opportunity to unlock the real potential of Burlington Telecom and look forward to proceeding to the next step in this sale process. Please feel free to contact us if you have any questions about the terms of this letter. Sincerely, ZRF Partners Schurz Communications, Inc. 52:9 Faisal Nisar By Page 4 of 4 Burlington Telecom Growth Opportunity November 2017 ZRF PARTNERS BT’s Unrealized Value 1.  BT is a scarce and strategic asset - its value has the potenEal to grow exponenEally 2.  Our vision of BT: “Make BT one the most admired regional Fiber company naEonwide and contribute towards making Burlington a hot bed for tech entrepreneurs and startups in New England” 3.  –  Double EBITDA organically –  OpportunisEcally consolidate/expand in other markets –  Become enabler of local tech eco-system –  SubstanEally increase value for all stakeholders ZRF and Schurz/HBC are hands-on partners with a track record of growing companies in similar situaEons in Telecom, Media and Technology markets 2 Fiber Market Developments •  Dot com era demand-supply mismatch addressed - BT was ahead of its Eme –  At BT’s launch: there was no iPhone, YouTube or Facebook and Ne\lix was just starEng •  ExponenEal growth in bandwidth consumpEon led by cloud, video consumpEon, apps •  NaEonal compeEtors focused on buying content, securing business customers and addressing Tier-1 markets - Window of opportunity to consolidate Tier 2/3 markets •  Beginning years of a 30 year copper upgrade cycle (60% of the buildings with 20+ employees are copper connected), similar to early days of Cable and Wireless industries •  Convergence of broadband infrastructure: towers, backhaul/metro fiber and datacenters converging; FTTH is a natural/criEcal extension 3 Growth Plan for BT •  Realize opera+onal leverage of the Network business – Increase EBITDA to $X - $Y million –  ConEnue the growth in penetraEon of exisEng network from by taking customer service to the next level and focusing on sales and markeEng (several fiber players including HBC, C Spire, EPB, Next Light are approaching 60%+ market share in their local markets) –  Focus on small business customers and provide them complete “IT in a Box” soluEon (expand product offering to include services ) – own customer relaEonship/one-stop shop –  Complete buildout in Burlington. Expand network to neighboring areas, “Pre-sell” the network (South Burlington and Winooski alone can expand market by 40%, addiEonal opportunity in Essex and Williston) –  BT can achieve its organic growth goal ($X-$Y million) of EBITDA through a combinaEon of above steps and fund growth from its internal cash flow 4 Growth Plan for BT •  U+lize BT’s learning experience and opera+onal skillset –  Partner with other municipaliEes where BT becomes operator of the network and Co-ops/ municipaliEes own the physical fiber –  ~90 communiEes with publically owned FTTH networks today and many more municipaliEes embarking on some form on municipal broadband (1) –  Acquire other networks which lack scale or have excessive leverage –  Acquire non-core fiber assets from uEliEes 1- “Municipal Broadband: Background and Policy Debate” report - Congressional Research Service, April 6, 2016. 5 Development of Tech Eco-system •  Burlington Technology Fund – BT should foster alignment of public and private interests. Community strength will drive network penetra+on. First equity check is hardest to find. –  Set up a BTV Ignite Technology InnovaEon fund in partnership with exisEng resources (universiEes, local founders and City) that provides seed capital to local startups –  Remove barriers to aspiring young entrepreneurs: start at a college level, provide conducive environment, physical space and financial support, define tangible goals and help raise insEtuEonal capital –  Focus on Burlington’s strength areas, generate startups that raise successful insEtuEonal capital. ZRF is also a potenEal partner and channel to naEonal VCs –  BT would contribute $1.75 mm over seven years toward this iniEaEve, invite local foundaEons and other insEtuEons to invest as well 6 Development of Tech Eco-system •  Workforce training and internship/appren+ceship program - Lack of technical skills is a major barrier to aSract or retain tech jobs –  Digital transformaEon is similar to industrial revoluEon, similar disrupEon caused by the introducEon of steam engine, electricity and micro-processor, tech skills are no more a “Nice to have” –  BT would work with local resources and establish a program that teaches basic technical skills to exisEng workforce and high school grads –  BT would offer internship/apprenEceship opportuniEes to local students –  BT would contribute $350,000 over seven years toward this iniEaEve, invite local foundaEons and other insEtuEons to contribute as well 7 Value RealizaEon Process •  ZRF & Schurz are hands-on long term partners with a goal to significantly enhance value of BT •  Organically double the size of EBITDA within 3-5 years •  Achieve premium EBITDA valuaEon mulEple by gaining scale and sEcky business customers •  Grow business via opportunisEc acquisiEon opportuniEes •  Develop very strong Ees with community to drive network penetraEon •  Liquidity opEons include: –  Sale to an infrastructure or pension fund –  Sale to a private company including but not limited to Schurz –  Dividend recapitalizaEon 8 ZRF and Schurz/HBC Background ZRF Partners Schurz/HBC Faisal Nisar, Founder & Managing Director –  20+ years of experience of building telecom, media and technology companies –  Previously, Partner at Baker Capital and an Analyst at Merrill Lynch Gary Evans, Senior Advisor –  Fiber to the home pioneer and community acEvist –  Founder, Ex President and CEO of Hiawatha Broadband CommunicaEons, Contributor to BT’s turn-around Schurz Communica+ons –  100+ years track record of owning and growing evolving companies (Newspapers, TV staEons, Cable, Fiber) –  15,000+ Fiber to the Home addresses Hiawatha Broadband –  One of the first compeEEve fiber entrants in US, First recipient of Broadband AssociaEon’s pioneer award –  70+ % penetraEon in 13 served markets, Leader in customer service and community engagement 9